Maastricht Treaty
Joseph Winn
Suzanne May
Redrafting the Maastricht Treaty
The May-Winn Act
The Maastricht Treaty was signed on February 7, 1992 in Maastricht Netherlands. The treaty led to the creation of the euro, and created what is commonly referred to as the pillar structure of the European Union. The treaty established the three pillars of the European Union: European Community, Common Foreign and Security Policy, and the Justice and Home Affairs. The convergence criterion that member states would have to fulfill to show they were eligible to join the single currency area had four basic elements. First, prospective Eurozone members had to keep a tight lid on inflation; specifically no more than 1.5% points higher than the average of the three best performing (lowest inflation) members of the EU. Secondly, there were strict rules on the annual deficits and overall debt; the ratio of the annual government deficit to GDP must not exceed 3% at the end of the preceding fiscal year and the ratio of gross government debt to GDP must not exceed 60% at the end of the preceding fiscal year. The third criterion states: members have to join the exchange rate mechanism for at least two years, and they were prohibited from devaluing their currency. Finally, long-term nominal interest rates had to be held down; nominal long-term interest rate must not be more than 2 percentage points higher than in the three lowest inflation member states. The May-Winn Act will be a treaty revision that holds of the formation of the European Monetary Union until the EU is fully integrated, will put systems in place that redesign the way member countries are audited to ensure fiscal discipline, and will revise the convergence criterion for when Europe is truly integrated and ready to form a common currency. The May-Winn Act revision of the Maastricht Treaty will eliminate premature plans for a common currency (the Euro), until the European Union is fully integrated. This revision is invoked
Suzanne May
Redrafting the Maastricht Treaty
The May-Winn Act
The Maastricht Treaty was signed on February 7, 1992 in Maastricht Netherlands. The treaty led to the creation of the euro, and created what is commonly referred to as the pillar structure of the European Union. The treaty established the three pillars of the European Union: European Community, Common Foreign and Security Policy, and the Justice and Home Affairs. The convergence criterion that member states would have to fulfill to show they were eligible to join the single currency area had four basic elements. First, prospective Eurozone members had to keep a tight lid on inflation; specifically no more than 1.5% points higher than the average of the three best performing (lowest inflation) members of the EU. Secondly, there were strict rules on the annual deficits and overall debt; the ratio of the annual government deficit to GDP must not exceed 3% at the end of the preceding fiscal year and the ratio of gross government debt to GDP must not exceed 60% at the end of the preceding fiscal year. The third criterion states: members have to join the exchange rate mechanism for at least two years, and they were prohibited from devaluing their currency. Finally, long-term nominal interest rates had to be held down; nominal long-term interest rate must not be more than 2 percentage points higher than in the three lowest inflation member states. The May-Winn Act will be a treaty revision that holds of the formation of the European Monetary Union until the EU is fully integrated, will put systems in place that redesign the way member countries are audited to ensure fiscal discipline, and will revise the convergence criterion for when Europe is truly integrated and ready to form a common currency. The May-Winn Act revision of the Maastricht Treaty will eliminate premature plans for a common currency (the Euro), until the European Union is fully integrated. This revision is invoked