Even before the pandemic hit, I realized that we were in a revolutionary moment where what would be impossible or even inconceivable in normal times had become not only possible, but probably absolutely necessary. And then came COVID-19, which has totally disrupted people’s lives and required very different behavior. It is an unprecedented event that probably has never occurred in this combination. And it really endangers the survival of our civilization.
We will not go back to where we were when the pandemic started. That is pretty certain. But that is the only thing that is certain. Everything else is up for grabs. I do not think anybody knows how capitalism will evolve.
Germany’s Federal Constitutional Court exploded a bombshell last week with its latest ruling on the European Central Bank (ECB). How seriously do you take it? The ruling poses a threat that could destroy the European Union as an institution based on the rule of law, precisely because it was delivered by the German constitutional court, which is the most highly respected institution in Germany. So you now have a conflict between the German Constitutional Court and the European Court of Justice. Which court has precedence? ...... If the German court’s verdict prevents the EU from resisting these developments, it will be the end of the EU as we know it.
it (ECB) should focus its attention on helping Europe to establish a Recovery Fund. Do you have any suggestions where these resources could come from? I have proposed that the EU should issue perpetual bonds, although I now think that they should be called “Consols,” because perpetual bonds have been successfully used under that name by Britain since 1751 and the United States since the 1870s.
You sound very pessimistic (about the EU). Far from it. I recognize that Europe is facing several existential dangers. That is not a figure of speech; it is the reality. The verdict of Germany’s Federal Constitutional Court is only the most recent challenge. Once we recognize this, we may be able to rise the occasion. We can take exceptional measures that are appropriate to the exceptional circumstances we’re in. That certainly applies to Consols, which should never be issued in normal times, but are ideal right now. As long as I can propose measures like issuing Consols, I won’t give up hope.