on output legitimacy : experts determine the relevant policy areas and the right policies, and a new strong independent institution enforces them afterwards. this would then lead to sound policy outcomes which would legitimise the process after the event. but this would bring us back to the functional narrative. indeed, a new convergence process cannot be a technical exercise for two reasons : first, the matters under discussion – be they labour market institutions, taxation, or the organisation of the judicial system and administrative capacity – are inherently political and much closer to the day - to - day life of citizens than, for example, monetary policy ever will be. second, an institutional architecture in a democratic system cannot be based mainly on coercion. after all, in our everyday lives we do not follow rules because we constantly fear punishment, but because we believe in the purpose of the rules and understand that they can only work if adherence to them is the norm, not the exception. we need a process that ensures the buy - in of citizens, governments and parliaments, that fosters a broad debate concerning our common understanding of what economic policies in a monetary union should look like, and that, for the most part, works based on consent to a common framework and provides fully legitimate institutions with the right instruments to intervene if the consensus is not respected. this kind of political convergence process represents an opportunity : it could lead us to the political narrative i mentioned before. but for that to emerge we would need to develop a common understanding of economic policies – it could mean that national parliaments and the european parliament need to speak to each other more, as we are doing today. if we were to commit to such a process, there would be a political cost to pay upfront as this would mean admitting to citizens that national parliaments alone cannot address all future challenges on their own anymore. but let us acknowledge that there is no such thing as a free lunch. this political cost is precisely the visible measure of collective commitment to the single currency project, which is necessary to ensure the economic and political resilience of emu in the future. european political parties could be a catalyst for such a debate – by organising more discussions than they do now, not along national lines, but according to social preferences. this could also mean that social partners would need to go beyond their national remit and adopt a european perspective. conclusion the outcome of this kind of process would certainly not be optimal from a purely economic standpoint. that is a key feature of

benoit cœure : towards a political convergence process in the euro area speech by mr benoit cœure, member of the executive board of the european central bank, at the interparliamentary conference “ towards a progressive europe ”, berlin, 16 october 2015. * * * summary the effectiveness of the ecb ’ s action rests on the “ m ” in the emu being kept free from political interference. but for this to be secured in a lasting way, we need to further develop the “ e ”, i. e. the economic union. in the past decade, intermediate solutions to save the euro area were found, but left the emu still vulnerable to future crises. therefore, we need to define a new convergence process, involving converging economic structures and more integrated markets. this should be complemented by fully legitimate institutions with the right instruments to intervene if the consensus is not respected. this new convergence process will lead to higher resilience against economic shocks on a national level and european level, via internal and euro - wide adjustment mechanisms. and it is a prerequisite before discussing a layer of fiscal stabilisation at the european level, which would protect monetary policy from bearing too much of the stabilisation burden. but such a new convergence process cannot be a technical exercise. for convergence to be lasting and to secure the buy - in of citizens and member states, such a process needs to be political in nature. this requires a revived political narrative for euro area integration, and a coherent european social contract that brings out the best in each national social contract. * * * honourable members of parliament, ladies and gentlemen, dear group vice - president carsten [ schneider ], many thanks for your kind introduction and for having me here today. i am glad to see that parliaments are at the forefront of the debate on the future of economic and monetary union or emu. you may wonder what an unelected central banker has to say about the political foundations of emu. after all, the european central bank ( ecb ) is not a political institution. indeed, for our work to be effective, the “ m ” in emu must be kept free from political interference. but to secure this in the long term, we need to develop the “ e ”, so economic union, further. i will argue today that the political dimension of economic union will be crucial. moving forward with passion and perspective almost, one hundred years ago max weber famously described politics