Throughout 2011 and in 2012 to date, positive steps have been taken. Several countries have launched ambitious fiscal adjustment programmes and undertaken banking system recapitalisation and restructuring processes. And structural reforms in the labour market and in the services sectors have been approved. Also, on a Europe-wide scale, debt-ceiling monitoring mechanisms have been reinforced, as have the procedures to sanction non-compliance. Further, under the new Treaty on Stability, Coordination and Governance, there have been moves to promote the explicit recognition of the commitment to budgetary stability in national legislations. Along with this progress in the fiscal realm, a new framework has been established to prevent and correct macroeconomic imbalances. This Excessive Imbalance Procedure, as it is known, should be instrumental in the early detection of vulnerability and in setting in place the necessary corrective measures. With the establishment of the European Stability Mechanism, there has likewise been headway in creating a permanent crisis-management mechanism. In sum, there has been significant progress. But frequently these changes have, as the markets say, been “behind the curve”; their implementation has been excessively slow and they have been subject to too many frictions, which has fuelled investor doubts over the ability of European governments to move forward and forge consensus on matters pivotal for governance in the area. Under these conditions, ECB action has been decisive in preserving stability in the area. When debt market tensions reared again in the second half of 2011, the ECB reacted with various measures.

Internationally, it is currently accepted that governments have very important tasks to perform in the financial field. These may include designing restructuring strategies, determining resolution instruments, deciding on the use of public funds, etc. But there is also broad consensus that such tasks should be implemented by independent regulators and supervisors. By assigning the regulatory and supervisory remit to independent institutions that act using sound technical criteria, the danger of decisions being subject to the vagaries of politics or to lobby group interests is removed to some extent. Reasons of technical capability also come into play. Independent and professional supervisors have the time and resources to build up enormously rich knowledge which, given the particular characteristics of financial activity, is essential for tackling problems in this sector, minimising errors and unwanted side-effects at the same time. Having independent regulatory and supervisory institutions by no means guarantees that mistakes are not made. But their presence ensures that decisions are not tainted by momentary political considerations. I cannot say that the Banco de España, in its supervisory mission, has not occasionally been mistaken. But I can assure you that the decisions of the Banco de España have always been based on exclusively professional criteria. This is an important facet of independence. Independence is not something innate. It is not a label or badge conferred by anyone. Independence is demonstrated, and it is exercised or not exercised. Nobody is independent for what they are, but rather for what they do.