THE FUTURE OF MONEY Bernard A. Lietaer - library.uniteddiversity ...

Furthermore, there is a growing consensus that this unemployment
situation will not be solved through economic growth. 'Full
employment can no longer be taken for granted as the automatic
outcome of growth-creating economic policies' concludes a European
green paper. A French study showed that even the high post-war
rates of growth of 5% resulted in an annual employment increase of
just 0.2%, and that this trend for jobless growth is getting stronger
over time. The introduction of the euro will further reduce the room
of manoeuvre for participating countries to decrease their
unemployment levels in three converging ways.
1. Each government participating in the EMU is giving the levers of
control over the euro money supply to the European Central Bank.
The ECB will by definition be less responsive to the requirements of
any one country's unemployment situation.
2. The Maastricht Treaty gives the ECB a single objective: to ensure
price stability. Full employment is specifically not one of its official
priorities.
3. Finally, the only other traditional tool available - the fiscal one
has similarly been put under severe constraints. The maximum limit
of 3% of government deficit financing is supposed to be a permanent
one and most governments are adopting the euro with their spending
at or dose to this straitjacket target limit. In practice this means again
that little room for manoeuvre exists to reduce unemployment via the
fiscal tools.
To summarise, an unprecedented set of circumstances will
converge over the next decade. The shift towards an Information Age
and the budgetary constraints imposed by the Maastricht Treaty are
at this point inevitable, and have powerful and valid arguments in
their favour.