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European Central Bank President Mario Draghi underscored Europe’s commitment to its union Wednesday in a speech at the John F. Kennedy Jr. Forum at Harvard Kennedy School (HKS).
Draghi, a 2001 IOP Fellow, was appointed to lead the European Central Bank in 2011, as the continent was plunged into a sovereign-debt crisis that some believed threatened the very idea of a single European currency. But Draghi said those critics misunderstood the depth of political commitment to European integration.
“Many commentators on this side of the Atlantic looked at the euro area and were convinced it would fail,” Draghi said. “They mistook the euro for a fixed exchange-rate regime, when in fact it is an irreversible single currency. It is irreversible because it is born out of the commitment of European nations to closer integration.”
Draghi’s pledge at the height of the crisis, in the summer of 2012, to do “whatever it takes” to save the euro was seen by many as a turning point.
"The agenda facing Europe is not adequately captured by the phrase 'ever closer union,’” Draghi said. “It is better encapsulated by wording borrowed from the U.S. Constitution: the establishment of a ‘more perfect union’. By this, I mean that we are perfecting something that has already begun."
That union will also include closer integration of the euro zone’s banking system. Draghi said a mechanism to deal with failing lenders should come into force in 2015.
Draghi made his remarks as part of the 2013 Malcolm Wiener Lecture in International Economy.
Beside his time spent at the Kennedy School in 2001 as an IOP Fellow, Draghi was a PhD student at MIT in the 1970s. He said he was delighted to return to a place “where I spent probably the happiest time of my life.”