Guy Verhofstadt & Richard Ashworth - Members of the European Parliament HARDtalk

his mother. When he's strong enough, he'll join his father outdoors. Now

on BBC News, it's time for HARDtalk. Europe's economic crisis is pushing

its leaders further and further down the road to economic

integration than some may have imagined. This is raising questions

about what is left of individual country's powers and identity. At a

time when EU citizens say they have never trusted the EU left - what is

their goal - to become a Federal superstate or stay a monetary union

based on common economic interests. I have come to the heart of

European Brisbane to the European Parliament to speak to Richard

Ashworth, and Guy Verhofstadt, who is a former Belgium Prime Minister.

Where is the EU project going, and Richard Ashworth, and Guy

Verhofstadt, welcome to HARDtalk. The man regarded by proEuropeans as

the forefather would -- pro- Europeans as the forefather would

like to see the crisis as an initiative, and to see us go

forward. Is this crisis an EU opportunity? You can say never

waste a crisis. I think at this moment it's necessary to use this

crisis to reform the European Union. That means that instead of having a

loose consideration of nation states, what we have today, we need

to build up what I call a Federal European Union because otherwise

you can continue with the single currency. This crisis around the

single currency has shown us that we need to also build up an

economic union, a fiscal union and a political union, just as you have

a real Federal state behind the dollar, and you have a state behind

the yen. A closer union, is that the way forward? I'm picking up on

your word of opportunity. I wholeheartedly agree with that word.

It's an opportunity for Eurozone member states to address structural

issues, which they have. The architecture of it is not fit for

purpose. It needs to be changed. It's an opportunity for those

nations that do not wish to integrate further, but value the

opportunity of working with 27 like-minded states to redefine that

relationship. It's a time for change, and an opportunity for all.

You say there's choice, and we'll get on to the idea of a two-tier or

two-speed Europe. Yes. powerhouse of the European Union,

Germany, Chancellor Angela Merkel says we need monetary, fiscal, bj

etry and a political -- budgetry, and political union. She says

there's not just one way forward. One thing we share is that it is

vital thatle European union and -- that the European Union survive. To

make changes it involves closer integration, a chaise which the

Eurozone nations have to mag -- a choice which the Eurozone nations

have to make. At the same time, this is a moment where we have to

sit together intelligently, and understand the needs of the others.

There are 10 nations not in the Eurozone at the present time. We

need to understand what they want from this relationship, and how to

inform an intelligent solution. That is the point. In terms of

people lacking the will to support the European Union, it is seen as

the cause of the problems, not the solution. That is not true. If you

look to the problems today, it's clear that more euro - certainly I

agree with that that it can be a difference between countries with

another currency, but it is a solution more the crisis. What does

that mean - more Europe? Let me make a comparison. US have a public

deficit. They have 103% of that It's a world record. They paid

lower interest rates. Even when there was a bankruptcy, that

doesn't mean there was a dollar. Why the difference with us. A

little economy like Greece, where it creates chaos in Europe, while

there is a state behind the yen. A real Federal state behind the

dollar. At the moment there's no state behind the dollar. You

mingsed what the press refer to as the -- mentioned what the press

refer to as the "F" word or the F bomb. What do you ep vizage.

Winston Church -- envisage. Winston Churchill said we need a United

States of Europe not to be joined by the British. That was his idea.

He said that is the way forward for the country to create the United

States of Europe. That means in reality you have a common Treasury,

one Minister of Finance dealing with economic and fiscal policies

of the country. Also, a single bond market. A Europe bond market. Lets

be honest, the biggest bond markets in Europe is Germany, and it's 10

times smaller than the bond markets in the United States of America,

and has a lack of lick wittedity. I think the crisis -- liquidity. I

think the crisis can be sourced if we create a bond market. It's

impossible to deal with a currency if you have 70 governments, 70

Ministers of finance, and different economic strategies. More appear to

follow suit that economic union is necessary. Does one need to jump

towards that? One warned "I would take precaution in introducing

Federalism into the equation, raising the bar of the European

Union to the theoretical". I don't think it will work, a single

currency if you don't have a political union. That's what rating

agencies say. They say the lack of economic and political integration

is the reason why we are downgrading some of these countries.

We accept a lot of those points. The Eurozone nations need to

integrate more. Britain wouldn't want to join. A reason is we doubt

whether nations that have enormous disparity between economic

efficiencies and competitiveness can make comfortable bed fellows.

The other point we are wanting to make is we are talking about the

United States of America or Europe. The global situation changes on a

daily basis. We are facing challenges to economies which are

emerging, south-east Asia, Brazil, and others. They are all

challenging us today. We in Britain are conscious of that, we are

acutely conscious that competitiveness is an issue, that's

why we want an outward looking competitive D-rated economy. We

feel the integrated call of Eurozone countries will lose site

of the objective, which is global competitiveness. It may be that

some nations like Greece, Spain, Italy. It may be that they can

change, deregulate. That's for them to prove. In the meantime I have

doubts, and I'm sure the United Kingdom has doubts for the time

being. We would be unlikely to want to participate in the Eurozone at

all. If you stay on the outside, don't you risk isolation. This is a

subject of debate in the European press and the European parliament

over and over again. This is where we in this European parliament have

to talk intelligently together and work out a formula where you can. I

don't see a contradiction between an inner core group and an outer

core of people who do not wish to join the Eurozone. They have to co-

exist. The single market is too big an issue to lose. Surely the

actions of one affect another. It's been said that the Swedish

Government, who is tending towards an a la carte proposition - that

issues could be decided on 27 member states - you can't afford to

stay outside. I can't pretend that that is not the real $64,000

question - how does that impact on the interests of the City of London,

on the United Kingdom's economy. I don't think anybody could pretend

that you could sneak this in without major change. We have a

test with the backing union. I have to tell you, I'm on the line that I

think single financial supervision has to be established in the

banking union. It has to be for the 27, not the 17. I'm not in favour

of the proposal of the Commission. We are giving that task to the

European Central Bank, because I think you have to make a split

between tasks, tasks of the European Central Bank. The task has

to be given or be a merger of the three existing bodies, European

banking authorities and the others - merge them into SSA, and that is

a better way forward than to create financial supervision inside a

union that is different for the 17. I completely agree with that. That

legislation has been put in place. We have had regulations which

control the banking sector. We are indulging in opinion polls, showing

that European citizens go on. It's the elite deciding what happens

with Europe. Is there a public app fight for integration. There's

research centres, global attitudes projects in May. It shows a

resistance to the decision to grant European Union the authority to

exercise limited oversized national budget. You are talking about

service. Let's talk about the political reality on the ground.

Are you dismissing all of this. I say the last election in the

Netherlands refused the treaty in a referendum seven years ago. It is

different. We have seen a shift from that to pro-European voting.

see it in Greece, France. Sorry, I can say that, the right wing party,

and the left wing party, anti- European socialist movements have

lost the elections. Winners were pro-European forces. Why is that

hag in the Netherlands. Because the Dutch are not stupid. They --

happening in the Netherlands. Because of the Dutch are not stupid.

The euro is the engine of growth, of the range of enterprises,

logistic enterprises. They voted for pro-European political parties

because they want to maintain the euro. One of the biggest economic

engines from Europe, the newspaper, shows recently in a new poll, that

64% of French would vote against ratifying the treaty. 60% of

respondents said they were in There is a lack of politicians in

France to say to public opinion it is in the interest of France to

have a more integrated Europe. The problem in Europe or the continent

- I do not talk about Great Britain - but on the continue known there

is a fall-away. Most political leaders follow Nationalist and

populist rhetoric. Democracy as a political leader, developing

efficient say trying to convince the public oh pin Ron to follow his

vision. Not what is happening now. Nationalist and populist rhetoric

in Sweden, in Finland, in France that is gaining ground. What are

people supposed to make of it then? You say they support the single

market. 25 million people out of work cannot be that thrilled about

it. Growth stagnant across. The EU, unemployment in youth in Spain up

to 49%. The people will say we believe in the single market, we

think there is something here that can help us but actually it is

perceived by us to shall the cause of our problems, you have the turn

this into the solution. Is the challenge, the people like you and

I have. I agree. We have always to say to these people, you - the

wealth of tomorrow, the G8 of tomorrow, what is the G8 in 20, 25

years, it shall be US, Japan, India, China, Brazil, Russia, Mexico and

Indonesia. No single European country shall be part of the G8 in

2030 that is in 18 years so the new world order that - there needs to

be an integrated Europe with full power with a good internal market,

I agree, not split into two parts. Some argue with a single currency...

Its I'm sorry but time is precious. Whichever vision of Europe will

take hold in the European Union, who exactly will decide? There is a

lot has been spoken about recently about a democracy deep sit in the

EU. Do you believe it exists? depends what you mean by Democratic

deficit. It is a phrase often used but nobody ever gives me the answer.

It boils down to the fact what do you perceive the European Union to

be. Is it a country called Europe or a cooperative owned by and

worked on behalf of and for 27 independent soof yin states any see

it as the latter and toy not have a problem. We have a democratically

eelectricityed council and the Democraticly elected Parliament

which there is to hold the commission together and clearly

after the Lisbon Treaty we are not doing that well enough. We need to

do more, but we do not have that problem. Exactly the European

Parliament, if I could put this to you, it is the only directly oh

electricityed European decision- making body. The Lisbon Treaty was

supposed to give it more powers but you service the European President

Martin Shulz acknowledging "In the last two years as a result trends

towards endless series of meeting was heads of state and Government

more and more legislative decision have been taken without the

European Parliament being consulted". How can you let this

happen? We are making huge protests against it. Thin Parliament, every

time when I'm intervening I business that issue. I think it is

a bad thing what we see the last two years, the development in the

direction of an inter-Governmental Europe that means a European

Council with the heads of states, Government, deSiding for the hole

of. The EU. I think we need more real European Government -- the

whole of. Control to buy this European Parliament. We have new

powers, the Lisbon Treaty has given full powers to the European

Parliament on every toppish of the treaty. Also on in - international

teethies have to be adopted by the Parliament. The problem is that

people t political leadership for the moment in the nation state

certainly in Germany and in France think this they have to govern the

European Union and they are not cape in of doing so. Look to the

euro crisis. We have at least 20 summits of the euro crisis and

every time they produce half measures without real vision for

the future. Isn't part of the problem the way the European Union

decision making bodies are structured? Too many close order

debates at the Council of Ministers t European Parliament, nobody

really knows where it is going to vote. The commission against

closed-door meetings. Is there not a time issue as well? You mentioned

the Lisbon treaty supposed the make a. The EU more depbl catastrophic.

It took eight years -- Democratic. All meetings in the European

Parliament are open, also committee mightings. Closed meetings are when

Chancellor Angela Merkel and Mr Hollande see each other behind

closed doors You vo the International Monetary Fund again

in a report in July -- you have. Complaining or pointing out the sea

dragging going on in the EU. Is that why the European Parliament is

cut out? No we are arguing we need a fully fledged change from the

Democrat contradict union which means full powers for the European

Parliament. It is not long an inter-Governmental body can decide.

You have a two-chamber system where the European Parliament is

representing Parliament and the second chamber in which nation

states are represented. Last thing, you need a real Government, a

European Government control by the European Parliament. We are elected

directly by the people t British people that elect the different

MEPs from there so this democracy exists today in Europe. But it is

not fully used. I does exist but so long as the council - there are 27

elected Prime Ministers are the superior body. We feel true power

should rest in the nation states. Only then can you get the

Democratic reaction to what the people want. Picking up on your

earlier point - yes, there is a problem, it is far too slow the

react and respond. The reason that is the architecture of the EU is

not fit for purpose for the future. It is not solving the problems

about to come. A good example is the euro which was always a

political project not a fiscal instrument. Hit been a fiscal

instrument there would have been rules, processes an disciplines

that had to have been followed and no doubt a number of nation was

never have been allowed to join the euro had they been in place. Again,

if we can return to the people of Europe. It has long been a desired

aim by decision-makers to bring Europe closer to the people and yet

with each successive EU parliamentary election fewer and

fewer people are turning out to vote. You have another election in

2014, how will you persuade people their vote is important?

European political parties shall present a unique candidate for the

presidency of the commission so it is a step towards a direct elected

President of the European Commission and European Government.

And I'm within favour of a system where the European citizens are

financing directly. The EU. I'm always say financing you pay for

something then you are interested in something. Did nation states are

giving the... That... No it is not the same S if you pay directly a

part of your VAT on what you buy directly to the EU you shall be

interested in what is happening to you. We have a problem here. The

first two points about directly elected President or whatever else

is not relevant and is not going to make any difference to the voters.

But this is a big issue that the European budget works on a seven-

year cycle. We are on a five-year parliamentary electoral cycle and

unless and until you aHine the to so you forge a link between

democracy and expenditure it is always going to be irrelevant.

Firstly, you have to resolve that. Secondly, while I regret that not

many people turn out to vote in European elections, typically 30%,

but actually that is more than the number of people who turn out for

local tort elections in the UK and you have never - local authority

releases or indeed in the US. there is less participation than

the European Parliament so you do not say that Obama is not there in

a legitimate way? Isn't it the responsibility of members of the

European part and national politicians to explain to the

people of Europe why it count? There is a complaint that all too

often politicians use. The EU as a scapegoat for national ills or to

tie score cheap points. If I was one of those 25 million people out

of work today or one of those young people without a job I would not be

the least bit interested in watching politicians throwing

bricks at each other. I would want to see people working out solution

thanks will address their problems not ours, they are going to do

something 3. The economy I'm on the budget committee here in. The EU.

Times have changed and the budget must change to reflect it. You

cannot go out as you have before. final statement? I do not think the

complaints have forwarded the European democracy. It is far more

important he takes his responsibility and puts the