Economic and Monetary Union: Pillar of a Federal Polity

The Masastricht Treaty commitment to the economic and monetaryunion (Emu) follows a lengthy process of building up monetaryintegration, starting with the European Monetary System (1979),then, in the 1980s, the free movement of capital and integrationof financial markets. Emu, representing the final stage of thisprocess, is seen by most federalists as a pillar in the structureof the European Union, contributing to its development by stagesinto a federal polity. With the economic and monetary union,the European Union's economic and environmental powers are becomingcomparable to those of some federations, and with institutionsthat have over time acquired substantial federal elements, furtherreforms may well make the European Union into a federal system.This article identifies the forces, interests, and methods involvedin an incremental process that may be called a new federalism.