Public debt cancellations by the ECB: let's start the debate.

Summary In a previous note, we put forward some proposals to ensure that the management of the health crisis does not bury the imperative of ecological conversion of our economies, that the short-term emergency does not destroy the desire to preserve a planet that is liveable for the human race in the longer term. One of the measures envisaged, the cancellation of public debts by the ECB, conditional on investments in the ecological transition, may seem iconoclastic, given that questions relating to money sometimes seem to be a matter of religious belief, and the dogma of the non-monetization of public deficits by the central bank is so deeply rooted. This paper proposes to show that not only is this proposal economically efficient, but that it is legally feasible and makes up for the institutional shortcomings of the euro zone, i.e. the absence of a federal budget. Moreover, the conditionality linked to the ecological conversion of economies could even breathe new life into the European project, which is currently undermined by blockages at the intergovernmental level, as to the level of solidarity required to deal with the financial consequences of the health crisis. For European citizens, the ecological project transcends borders and allows them to regain control over a common future. The proposed conditionality supports the project to fight global warming, announced as a priority of the new Commission.