see as the medium to long run outlook for the european union as a whole and for the future prospects of the integration exercise? many of us have observed that europe has faced many crisis over its five or six decades, somewhere were existential. out of all of those europe did seem to come out stronger and move forward. will that happen this time? >> i think this is happening this time already. we are moving, perhaps without being aware, towards some diagnosis of even political union. the crisis has brought about an

acceptance of government much greater coordination at eu level of national budgetary policies. since last year the so-called european semester is in place. this means that each of our governments has to submit to the european commission and european council of ministers. in the first half of the year before it goes to the national parliament, a draft budget, this is incredible if you think of it. this was asked by the european commission for years and years and always rejected by member states isn't this -- to the parliament. it's in place.

that's one aspect. then the acceptance of a much enhanced economic surveyance, there is operational influence of supervision by the eu. so the in itself slow structure of the 27 or of the 17 members of the euro area has moved, has moved considerably, thanks, one should say, to the greek -- if i say in one year time, i would imagine a euro area that would

have composition more numerous than the current one. i don't see honestly countries going out of the euro. i see some countries coming in the euro in the next few years. i believe that the permanent crisis management system, esm, which we will put in place soon will be there as an ordinary instrument for crisis management. the eu was not contracted to manage crisis, and it was a big deficiency. this crisis forced us to update the machinery. i believe that we will see a shift in the competency, functions relative to the member

states with some areas moving up. for example, there is slow process, which in my view will accelerate concerning tax cooperation, a sensitive topic but is going ahead. so tax policy will be slightly more centralized. but on the other hand some policies, which have been running for decades as if it were in an incubator are now ready to be delivered in the network, governance through network system. this the case of competition policies, which in 2004, which was largely outsourced to the national competition authorities although keeping coordination. i would imagine a europe not necessarily more cumbersome but

focusing on its core business. the core business of europe will evolve over time, but the ability to respond to crisis lucky enough is still there. the worst case scenario, of course, would be to have crisis and not be responding to them. the best case scenario would be to have an ability to modernize your structures even without crisis. we are not so virtuous yet. >> i have one more question that i want to open it up. you met with the congressional leadership this morning. you're going directly from here to the white house to meet with president obama. what can the united states, the rest of the world more broadly do to help you? is there any specific role for

the international monetary fund in coming back into the picture as it did at the out set of the crisis to help support the resumption of stability? this is a moment where the german chancellor has for two months very constructively asked me what can we do more for you. and maybe this will also be the question by president obama. in fact, it did come up in the meetings this morning with the congressional leadership. i think italy is not in a state where it needs financial supp t

support. but it needs better governance, and it wants to contribute to better governance. this has largely to be achieved within europe. for example, i think we came to a deep common understanding with germany that anything which would improve the perceptions by the markets that the eurozone is well governed, in terms of readiness to put up adequate fire walls will actually imply a very small probability that such financial resources would have to be used because they will be credible enough for the mere fact that they are there. with the u.s., i think this would be the topic of my

conversations. i don't know. i hope i'll not be late to the white house. >> we'll get you there on time. >> how, given the fact that the u.s. is struggling to have budgetary consolidation, as we would call it, and these are reentered towards growth. we are doing exactly the same in a different context how we can develop synergies in order to do this more easily. as to the imf, there is a prominent figure of the imf in this room. i would say that the imf is playing a key and constructive role. i think the imf is right when it

says concerning crisis management and financial fire walls we cannot do more vis-a-vis europe unless the europeans give proof of believing in themselves enough and doing in themselves what they can do in terms of fire walls. i think this is a correct attitude. where i perhaps should see a room for improvements also on the part of the imf would be in having a broader understanding of specific situations in which

the strict adherence to model might prevent a pragmatic solution of the problem. now, i don't have the latest details about the agreement reached with the prime minister, the agreement between him and the three political parties. it's my understanding the states on the side of caution and discipline believe that this is the moment to consider if there is a minimum of compliance with the requirements set out, this is a moment to turn the page and

to extinguish this potential greek explosion. okay. the floor is opening. we've got two standing mikes in the back. we have a couple of traveling mikes here. please identify yourself and then fire away. we've got a question in the back and one over here. >> john with the financial times. the greek program will approve a retroactive clause, a retroactive rewriting of bond contracts. won't this impose a risk for bond holders, a higher price for issuers of local law bonds such as italy and any other deficit country. isn't there a issirs aside from greece who will now have to pay more because of greece's rewriting of contract law. of course it was originally

denied by greece and ecb it hass the certification confined just to greece? in other words, isn't there a cost to the rest of the european issuers for this bond contracts. >> two things. one i think at the highest political level has been clearly said that this role given to the psi after the real meeting between germany and france has caused a lot of problems. we will not become a permanent fixture of policies. second, don't you believe -- i'm

returning the question to you, if i may. don't you believe the risk of countries rewriting contracts was already largely incorporated in the markets and therefore interest rates already? i happen to think the answer to that would be yes. so i don't expect that this would worsen the position of the italian treasury in the market. whereas i do think once this page is turned, the benefit will be considerable for every issue we are and for the markets overall themselves. >> next question over here. nancy. >> nancy -- [ inaudible ] when you responded to fred's question on the future of european integration, you didn't talk about the banking sect or issues. we now have the banking

supervisor assessing the results of the stress test and determining what they think is needed. but in terms of getting those outcomes, it's up to the individual states to try to figure out what has to be done. and i wonder in looking at the future what you see is needed in terms of greater harmonization and strength of the central banking structure. >> very important point. and i think many politicians in europe those our friend was too visionary when he was invoking real eu level supervisory structure. events approved he was visionary but highly realistic. and in fact, europe has

gradually moved towards that direction with the report and subsequent policy decisions. i think absolutely right, i should have mentioned this. the banking sector is illustrative of two things. one, when i was saying earlier there has been this affection for integration or rejection of integration, the european banking system until three, four, five years ago had undergone a very remarkable process of cross border integration than following the crisis, the wish to stay closer to father and mother has prevailed. and the states -- the treasury

being the source of rescue money has reduced banks to retrench to some extent. there has been more fragmentation in the european banking system. that is also part -- that is because two elements of the european are not pronounced enough yet. one is that there is still big room for state aid. state aid, not eu aid. secondly, there is this ambivalent situation where banking supervision is half baked between the real eu level and national level. thank you for raising this.

europe will not make a decisive forward step towards being an integrated single market with the appropriate policy instruments at the eu level until this is remedied. >> as the prime minister said, we have to be sure that he gets to the white house on time. he also has to have a bite of lunch. so we have time only for two quick questions, the two at the head of the queue, ask your questions one right after the other and the prime minister can choose how to respond to the two. >> mr. prime minister, you described germany -- [ speaking foreign language ] >> you described germany as being a social market economy. you said that the central government in europe should become bigger. don't you fear that your message may be taken in the wrong way within the republican

candidates? more seriously, how do you respond to the constant allegations we hear in thepe is socialist country and is moving in that direction? >> go ahead and ask the second question and respond. >> thank you very much. prime minister, my questermny b different. germany has grown quite rapidly but has a large current account has a current deficit, gdp. of competence lost between germany and vis-a-vis the rest of the world. does your plan beyond structural reforms, which take a long time to work, actually deal with

>> can i take the second question -- please do. >> second question first. yes, the answer is unambiguously yes. italian entrepreneurs and top managers in this room will probably confirm italy has a sizable worsening of competitiveness. and that explains, to a large extent, why italy for the last 12 or 15 years has had an average rate of growth about one-half that of the euro area not of the bricks of the euro area. structural play in the

long-term, yes and no, because coming out of the bank of italy the estimates i gave earlier, some affects of structural reform can come up quickly. i think the direction of policy has really to look at total factor productivity as you economists would call it, which means that a lot of work has been done in the field of the labor market, in order to facilitate increases in productivity there and the closer relationship between rewards and productivity. but also a lot has been -- has to be done by remedying to elements of lack of competitiveness which are outside the firm, like inadequate infrastructures, like

huge bureaucrat burdens. true, each of these can play out effects on relatively long-term. i think international investors to markets are watching very closely what each country does or does not in these areas. and i perceive a view of italy in the international business community as the view of a country which has very, very strong fundamentals in many respects, which compare very well with those of other countries, particularly in europe. i will not list them here. but they are prevented from generating actual growth because of these constraints. i believe that once the markets

will be convinced that things will change and have started changing, i think they will -- and i hope, of course, that they will accelerate this process by moving in, like on treasury bonds. i'm not here to promote them. my deputy finance minister is in new york working also towards that. but given the current levels high, 5.5% rates on medium to long-term treasury bonds in italy, if really one is perceived that greece is moving outside of the problem area and that this policy process in italy is not going to continue to exhibit results. many people tell me once we reach this conviction, there is a remarkable room out there for

capital gains on italian treasury bonds. i think something similar not that speed could happen achieving early on benefits from pro competitiveness policies. german growth the question, is this a lunch speech on germany, no, it's not. i spoke already to match in germany about germany, sorry. but the first question brings us inevitably to germany again. i'm sorry. did i describe -- if europe has the model of a social market economy, and if i say that there will be a heavier government in

brussels for europe, how will this resonate especially with the republicans and in the u.s. he is an immineeminent journali sharpening views rather than sophisticated ifs and buts, but it contains the market for many of our countries in europe as they were before the full impact of social -- of european integration. what europe really brings is a much more president obama market orientation. most of our domestic in the

industry, therefore have been achieved because of europe. so europe has been a powerful factor for liberalizing the eu economy. and so speaking about the social market economy, if, then, in the appropriate context is not underlining social effect of european -- for the government of europe, i just said, mario, some functions will have to go up two, others can be evolved to the national capitals or the regions. so no, i do not expect a heavier

government. it is true the borderline between socialism and pro market attitudes is very thin and mobile, i always remember a day in 2001, the previous day i was commissioner for competition versus the previous day i had blocked the merger and rejected a french company, so i was described as socialist in the u.s. press. as a dangerous neo-liberal in the french press. >> mr. prime minister, we could obviously go on all day. we wish you the best of luck. we are with you, we support you, we hope and pray for your

success, and we welcome you to the united states. [ applause ] this weekend on c-span's newsmakers, senator jeff bingaman from the natural resources committee he'll answer questions about the energy and environmental policy. you can watch newsmakers sunday at 10:00 a.m. and 6:00 p.m. eastern. >> when i first started the book, i thought, this must be an american story. this is about a country that worships the religion of self-reliance and individualism. this is a legacy of thorough and

emerson. it turns out we're laggards when it comes to living alone, much more common in european nations, especially scandinavia, even more common in japan. afterwards on going solo, he looks at the growing trend of american adults choosing to live alone and what that means for the country saturday night at 10:00 eastern. also this weekend on book tv sunday at 3:00, the second cousin of former secretary of state condoleezza rice, connie rice, on her work to reduce gang violence in l.a. and starting a dialogue between gang leaders and police. and at 8:15 georgetown university bonnie morris on her one-woman play and book of the same name, revenge of the study professor. book tv, every weekend on c-span 2. last weekend russia and china vetoed united states resolutions to stop the violence in syria and move toward a political transition in damascus. britain's foreign secretary

hague spoke to the path of commons about the path forward for syria. >> with permission, mr. speaker, i'll make a statement on syria. the whole house will be appalled by the blood shed and repression which continues at this very moment. over the last 11 months more than 6,000 people have been killed. the syrian regime deployed sniper, tanks, mortars against civilian population centers particularly in the city of homs and dara. thousands of syrians have endured imprisonment, torture and sexual violence including the incidence of adding rape of children. humanitarian situation is deteriorating. it is ununacceptable situation which demands a united national response. last tuesday i attended u.n. security council debate in new york with secretary clinton and french minister and other ministers, we all spoke