Verhofstadt: Europe's financial crisis requires a federal solution

“At the start of the new parliamentary year after a summer of crisis, Liberals and Democrats in the European Parliament are calling on the European Commission to seize the initiative from the Member States to resolve the persistent financial crisis that is fast deteriorating and infecting the real economy.

ALDE group leader Guy VERHOFSTADT said:

"I appeal now for a bold and brave approach, particularly from the European Commission which has the right of initiative, to seize the initiative back from Member States and get on top of the crisis once and for all. We are returning from a summer of indecision and mixed messages that have only served to exacerbate the problems of the eurozone.  Time is now running out. Member States can no longer escape the hard truths of their inaction and policy weakness in the euro area.

"It is not acceptable to sit and wait for Merkel and Sarkozy to stitch up another deal between themselves. The European Institutions exist to defend the Community interest. There is no greater need for this than now when governments are too scared of public opinion to propose what really needs to be done.

"Pro-Europeans should not be afraid to speak out in defence of a federal solution since that is what is now needed to end the crisis that is doing untold damage to our growth and stability. In the past, crises in Europe were overcome by solutions based on closer integration. That should also be the response today to the present crisis."

"The Eurozone clearly needs to be bolstered by the structures and mechanisms of a fiscal federal union with strong economic governance underpinned by commonly secured bonds. There can be no more doubt about the importance of automatic sanctions for the preventive arm of the Stability Pact to ensure that no Member State in future can get away with running irresponsibly high deficits."”