This chapter presents a short historical background of each central bank, starting with the European Central Bank (ECB), followed by the pre-euro Bundesbank and the Federal Reserve System. The basic institutional structure of each central bank is presented as a prerequisite to an understanding of the issues of independence, transparency and accountability, which are discussed in Chapter 2.
The idea of creating a single European currency with a single European central bank pre-dates the Maastricht Treaty (1992), which outlined the organisation, powers and functions of the European Central Bank. In the post-war period, at The Hague Summit of December 1969, the Heads of State or Government of the six original Member States of the Community (France, Germany, Italy and the Benelux countries - Belgium, the Netherlands and Luxembourg), declared in a communiqué that the Community should work, in stages, towards the goal of achieving an Economic and Monetary Union:
They have reaffirmed their wish to carry on more rapidly with the further development necessary to reinforce the Community and its development into an economic union. They are of the opinion that the process of integration should end in a Community of stability and growth. With this object [sic] in view they have agreed that on the basis of the memorandum presented by the Commission on 12 February 1969 and in close collaboration with the Commission a plan by stages should be drawn up by the Council during 1970 with a view to the creation of an economic and monetary union … They have agreed that the possibility should be examined of setting up a European reserve fund, to which a common economic and monetary policy would lead.
(Point no. 8 of the final Communiqué of the Conference of the Heads of State or Government on 1 and 2 December 1969 at The Hague, Appendix 1 of the Werner Report 1970)