ABSTRACT
With the Green Book and the decisions of the Madrid summit, European governments and the Commission had hoped to re-establish EMU’s fragile credibility. However, the real test was convergence to the Maastricht criteria. As this proved to be economically painful, public opinion became increasingly hostile. Even mainstream political parties were tempted to capitalize on the fears and doubts of euro-sceptical voters. The populist EMU critique had some parallels with the populist movement that emerged in North America when the US single market was created in the 1890s; both shared anti-liberal rhetoric, irresponsible economic promises, and a latent xenophobia. In some countries, especially Germany, there was a real risk that EMU could fail because of a lack of political support from the population and among the Members of Parliament. The German government, therefore, hardened the conditions for EMU membership and also for fiscal policy making in EMU, although in other countries serious and painful convergence efforts were under way. The most spectacular example is Italy, where the price of convergence was high in terms of growth losses and unemployment, but also France. As public opinion and political rhetoric deteriorated in the climate of economic recession and political distrust, the AMUE focused on explaining the reasons for EMU, especially in Germany. Its communication strategy tried to overcome populist EMU criticism by rational arguments; providing new evidence for the need for a single currency. This has contributed to an environment that allowed governments to pursue their objectives in achieving EMU and achieve convergence.
