Merkel wants political union in EU

By Alex Veeneman on June 7, 2012

German Chancellor Angela Merkel.
(Photo courtesy of the federal government)

The German Chancellor Angela Merkel has said in remarks on television in the country there needs to be a political union within the countries of the European Union. Merkel said there also needs to be a budgetary union.

“Step by step we must from now on give up more competences to Europe, and allow Europe more powers of control,” Merkel said according to a report from the BBC, whose remarks come after a proposal from the European Commission called for a banking union, announced June 6.

Merkel reiterated in comments on television that budget growth and consolidation were “two sides of the same coin”.

Britain’s Chancellor of the Exchequer George Osborne however expressed concern. In a BBC interview, Osborne said the UK would not participate in the proposed union. “We need to make sure that the mechanisms already put in place can be activated,” Osborne said. “The banks have been one of the weak links in all of this and the euro zone have tolerated weak, under capitalized banks for too long.”

Speaking after a meeting with Merkel, British Prime Minister David Cameron expressed confidence that the union would be formed and confirmed the UK would not be participating in the union, according to a report from Britain’s Press Association. “I can understand why euro zone countries may want to look at elements of banking union. Because we are not in the single currency, we won’t take part in the profound elements of that banking union,” Cameron said. “I wouldn’t ask British taxpayers to stand behind the Greek or Spanish deposits. It is not our currency, so that would be inappropriate to do.”

“I understand why single currency countries have to look at deeper integration,” Cameron added. “I will make sure that Britain’s interests, particularly in the single market and the openness and fairness of the single market are protected. That is key for Britain.” Cameron added that his meeting with Merkel was positive but there had been no announcement in response to a solution to restore confidence in the euro.

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