Barroso calls for EU "federation" Europe must evolve to "a federation of nation states," said José Manuel Barroso, the European Commission president, as he pleaded for deeper political integration among the EU's 27 members and an overhaul of the bloc's treaties to bring this about. The call for a federalist Europe - even on a limited basis - marked a surprising shift for the former Portuguese prime minister, who has until now staked out a cautious approach to one of the EU's most ideological debates: how closely member states should integrate and how much national sovereignty they should cede to Brussels. Mr Barroso's plea was the cornerstone of his third annual "state-of-the-union" address, in which he attributed the euro crisis to a lack of political cohesion in the bloc that had undermined its credibility - both with citizens and financial markets. He chastised bickering leaders for undermining decisions they had taken at summit meetings in Brussels, and for conducting these gatherings like "boxing events" in which they tried to "score a knockout" over rivals. The crisis, he concluded, had revealed the need for a leap forward in political integration to complement the closer co-operation member states had already begun to embrace to harmonise their economic and fiscal policies. We will need to move towards a federation of nation states. This is what we need. This is our political horizon," said Mr Barroso. That shift could begin under the current EU treaties, he said, "but can only be completed with a new treaty." Mr Barroso promised to submit ideas for treaty change - a notoriously arduous process - before EU elections in 2014 so that they could form the basis of a proper European debate. In an effort to enliven that contest, which typically suffers from scant voter turnout, he urged the political groups to each identify a person at the top of their list who would serve as their nominee for the commission presidency. In policy terms, the most substantial proposal Mr Barroso offered was a plan for unified banking supervision in the EU under the auspices of the European Central Bank. The details of the scheme, which would govern some 6,000 banks across Europe, were broadly known before the speech. It aims to address one of the most toxic aspects of the crisis in which faltering banks have seen their obligations piled on to sovereign governments, in turn weakening public finances. "Getting the European supervisor in place is the top priority for now, because it is the precondition for the better management of banking crises, from banking resolution to deposit insurance," said Mr Barroso. On Greece, which has been ravaged by the crisis and whose membership of the eurozone has now become an open question, Mr Barroso offered a cautiously optimistic assessment. "I truly believe that we have a chance this autumn to come to the turning point," Mr Barroso said. I believe that if Greece stands by its commitments it should, as a member of the European family, stay in the euro area. The speech, delivered at the European Parliament in Strasbourg, wrapped up just moments before word came from Karlsruhe, that Germany's constitutional court had rejected legal challenges to the eurozone's €500bn rescue fund. The news brought a smile of relief to the commission president. But MEPs offered only modest applause to his remarks, and appeared to be divided over his call for a "federation of nation states." Guy Verhofstadt, leader of the Alliance of Liberal Democrats, disparaged it as insufficient. No, no, no, no federation of nation states. That's more of the same. That's more of what we have already. Mr Verhofstadt, a former Belgian prime minister, had been seen as a leading candidate for the commission presidency in 2004 but was thwarted in favour of Mr Barroso because the UK, in particular, objected to his full-throated calls for a federal Europe. Martin Callanan, the leader of the European Conservatives and Reformists, also attacked the proposal. "All we have seen is more of the same old tired approach," Mr Callanan said, calling demands for "more Europe" the "knee-jerk reflex of the European elite."