The European Central Bank (ECB) needs an ‘ambitious reinvention’ to cope with today’s challenges, like the energy and inflation crisis triggered by the war in Ukraine, Labour Minister Yolanda Díaz said during Wednesday’s European Parliament’s Beyond Growth conference.
Diaz (Podemos/EU Left), who announced her candidacy for prime minister with the new left-wing political platform Sumar in April, said a “reinvention” of the ECB is urgent to ensure monetary policy includes a social and climate dimension.
“Monetary policy will have to broaden its objectives, incorporating into its mandate considerations of social cohesion, climate sustainability and, why not, the search for full employment”, Diaz said.
Díaz added that monetary policy “should consider that interest rates are not the only tool, nor the best one to deal with an energy price shock”, as the “success” of the Iberian exception showcases.
“An urgent reform of the European energy market and an acceleration of the energy transition are more appropriate recipes to combat inflation than the reckless rate hikes decided in Frankfurt,” she said, referring to the ECB’s recent interest rate hikes aimed at battling inflation.
The left-wing politician further stressed that to transform Europe, we must “transform its monetary policy and institutional architecture.”
“The ECB has a mandate to maintain price stability and tools, mainly interest rates, which are very limited to meet the challenges of European economic governance,” she said.
The EU Green Deal is “an opportunity to innovate on the fiscal level using an emergency climate tax on the wealth of large fortunes, to carry out a green reform of national accounting, to commit to green industrial planning that corrects territorial inequalities within the European Union and to implement a model of energy democracy that learns from the dangers of previous dependencies and puts the interests of European citizens first”, she said.
“Social issues are not a mere appendix or adjective”, she commented, adding that in Spain, it has been demonstrated that raising the minimum wage “not only improves people’s lives but does not negatively affect employment.”
Diaz’s Sumar would obtain 10% of the vote if elections were held today in Spain, while the socialist party (PSOE/S&D) would win the race with 30% of the vote and centre-right Partido Popular (PP/EPP) would obtain 26%, a recent survey by state-owned Centro de Investigaciones Sociológicas (CIS) predicted.
(Julio Gálvez and Fernando Heller | EFE and EuroEFE.EURACTIV.es)
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