Another day, another goddammed newspaper editorial that attempts to drive home the inevitable: that there is no alternative to austerity and bank bailouts, and that Ireland must bow its head and collaborate with the neo-colonialism of the European Union, just as Greek parliamentarians have done this week. But it is nothing new for the Irish Independent to align with reactionary anti-democratic forces.
As the Greek demonstrations have shown, austerity programmes mean no expense spared when it comes to repressing the population with batons and tear gas should the need arise. And to add humiliation to injury, it’s fairly clear from this afternoon’s events that ‘bailouts’ demand that even the bare bones of state sovereignty get gnawed away.
The coast guard in Athens is preventing the US boat The Audacity of Hope from sailing on its humanitarian mission to Gaza to highlight the evil blockade of the Palestinian people there. One cannot be but horrified in observing how venal and spineless the Greek government now is, how much of a slave it is to the whims of the main centres of power, that having applauded itself for plunging its people into decades of misery mid-week, it would now turn itself into an obedient agent of the racist apartheid Israeli state and its imperial master, so as to stop letters from Americans reaching Gaza.
Not that the Irish government has done much better. The fact it has adopted a more pro-Israeli stance by comparison with its predecessor last year is to some extent on account of its capitulation to EU-IMF diktats on the one hand, but also through the association maintained by the main ruling party with some of the most rancid reactionary right-wing parties in Europe (not including its junior partner), whose support for Israel draws on both a history of antisemitism and anything varying from a flirtation to a deep commitment to fascist politics.
Let’s not be too hasty to dissociate the question of crumbling democracy in Europe from the Gaza blockade. EU governments have been sucking up to Israel for years, doing a spot of hand-wringing here and there over Israel’s brutality towards the Palestinians, whilst simultaneously treating Israeli governments as partners in Western civilisation. Avi Shlaim wrote in 2009 that:
Israel likes to portray itself as an island of democracy in a sea of authoritarianism. Yet Israel has never in its entire history done anything to promote democracy on the Arab side and a great deal to undermine it. Israel has a long history of secret collaboration with reactionary Arab regimes to suppress Palestinian nationalism.
Despite all the handicaps, the Palestinian people succeeded in building the only genuine democracy in the Arab world (with the possible exception of Lebanon). In January 2006 free and fair elections for the legislative council of the Palestinian Authority brought to power a Hamas-led government. Israel, however, refused to recognise the democratically-elected government, claiming that Hamas is purely and simply a terrorist organisation.
America and the European Union shamelessly joined Israel in ostracising and demonising the Hamas government and in trying to bring it down by withholding tax revenues and foreign aid. A surreal situation thus developed – where a significant part of the international community imposed economic sanctions not against the occupier but against the occupied, not against the oppressor but against the oppressed.
Why should we be surprised then, that having colluded with the US and Israel in the destruction of Palestinian democracy -the Gaza blockade is a principal tool in this destruction- European Union power elites should then turn their attention to the destruction of democracy in Europe itself?
The abyss is coming into view. European nation-states, under the umbrella of the European Union, are stripping away any pretension to even basic principles of representative democracy, gradually turning into Herrenvolk dictatorships as their functionaries administer policies of repression and expropriation on behalf of power and wealth, congratulating themselves for their tough decisions, and murdering while they smile.
If a reversal is to come, it won’t come through a nip here and a tuck there to the same political systems and processes that engendered this crisis in the first instance and are now serving to deepen it. It will come through the reinvention of democracy, through ordinary people coming together in towns and cities across Europe to work out and recognise their common interests, and then to adopt radical actions to protect these interests, in places of work and on the streets and squares.
The following piece is by Juan Torres López. Titled Outraged Europe, It explains how austerity policies are nothing but a chimera and a lie, a flight in the face of empirical knowledge, designed to turn the broad mass of European citizens into impoverished peons of financial institutions. The solutions he proposes are moderate, conservative even, but such is the grim determination of Europe’s anti-democratic power elites to oppose any sort of resistance to austerity from the European citizenry, the implementation of these proposals are scarcely imaginable outside the context of a revolutionary turn.
By putting the European project ever more clearly in the service of the interests of large economic and financial corporations, the leaders of the European Union are going to ensure that the majority of the European population turns its back on Europe and, outraged, severs links with the horizons and the sacrifices that they wish to impose on it.
To try and save the passengers in first class when the plane risks crashing is a chimera. But instead of understanding that it is all of Europe that needs to be saved, its leaders give way to pressure and opt to save solely Franco-German banks and after that, the nationals of each country. In order to achieve this, they are about to plunge Europe into a depression and an unprecedented crisis and may end up transforming it, in order to save the furniture of the big financiers, into the biggest corporate dictatorship of the planet because all this is being carried out, moreover, without any social deliberation and through the cutting of rights and the imposition very high social costs without the slightest consultation of the population.
And if that were not enough, it can be said that the economic measures being imposed are tantamount to swindle because they insist on basing economic policy on the moderation of wages and public spending, arguing that this is the way competitiveness and employment will be increased when today it is known for certain that it does not work this way and that cutting wages does not create jobs but the opposite.
Researchers Jesus Felipe and Utsav Kuma have recently shown (Unit Labor Costs in the Eurozone: The Competitiveness Debate Again, Working Paper of Levy Institute, 2011) that the thesis employed by European authorities to justify their policies –that to raise production and employment there should be lower wage growth- is totally unproven. And if unit labour costs have risen in years or in countries with poorest employment levels, which the argument used by the neoliberals in order to impose their measures, it is not because wages have gone up, but because prices have gone up, as a consequence of the enormous power enjoyed by the big firms, which they never confront.
Sylvain Broyer and Costa Brunner showed a little while ago (L’évolution récente des parts de marché intra-UE n’a rien à voir avec la compétitivité coûts, Flash Economie, Natixis, N° 193, 2010) that the evolution of intra-European market shares of different countries has nothing to do with competitiveness costs. In order for market shares of different countries to correspond to their different cost levels, that is, in order for the desired effect sought from the wage setting measures imposed by the Euro Plus Pact, all Eurozone countries would have to export the same products, which would have to be perfectly substitutable, and this is precisely the opposite of the case in Europe, where the actual observed trend is one of progressive specialisation.
Also a little while ago, James Galbraith y Deepshikha Chowdhury (The European Wage Structure, 1980- 2005: How much flexibility. LBJ School of Public Affairs. Austin, Texas 78713, UTIP Working Paper Number 41, 2007) showed that it cannot be deduced from the data on wages and employment in Europe between 1980 and 2005 that wages should be lowered in order for employment to rise, because what is actually the case is that the variations in wages and employment have gone hand in hand: when wages have gone up employment has gone up and when they have reduced it has gone down.
And since the end of the 90s there have been numerous studies by authors such as Dean Baker, Laurence Ball or Thomas I. Palley that show that the evolution of unemployment in Europe does not depend of variables that have to do with “rigid” institutions in the labour market but with the dominant macroeconomic policies of austerity and wage moderation.
Even the OECD itself, one of the strongholds from which neoliberal policies are designed, had to recognise in its 2006 Employment Outlook (p.190) that different countries had been able to achieve good results with regard to employment by applying “extremely different” policies, and the French economist Jean Paul Fitoussi claimed in 2003 (Comments on Frydman, R., Stiglitz, J., Woodford, Expectations in Modern Macroeconomics, University Press, Princeton, p.434) that “until now there has been no evidence that labour market institutions are responsible for the high level of unemployment in the European Union”.
It is not true, then, that the wage cutting measures contemplated in the Euro Pact are going to allow jobs to be created. There is a far greater empirical basis to be sure that the austerity that is being imposed is going to weaken the capacity to create jobs and is going to bring Europe into a stagnation that will have very serious social consequences for years.
And what is dangerous is that it is preferred to produce these dramatic effects solely to ensure that the earnings of financial institutions go up, so that the banks that have produced a colossal financial disaster recover their profits and power as soon as possible, and so that big firms consolidate their position of privilege in the markets.
Europe needs a different political and economic direction. The Euro has already stopped just short of generating an unsolvable systemic problem in Europe that will sooner or later spread to the rest of the world. Who really believes that the solution is to go around condemning one nation after another to the same road imposed on Greece, leaving them without the resources to lift their heads for the next one or two decades?
Europe needs a new monetary and economic regime that does not constantly widen the deep asymmetries that today exist, but rather helps to narrow them through policies of welfare and equality.
The problem of debt must be decisively addressed, so that the people who bear its burden are the ones who have caused, and so that it can no longer be used as a source of business for financial speculators. This requires a different central bank and a different monetary policy, committed to full employment, sustainability and equality. It is essential to have a proper European budget and treasury to produce fiscal harmony, rebalancing policies, and the dismantling of mechanisms that presently favour the extraction of revenue for financial institutions at the expense of wealth creation. There should be continent-wide labour norms, with pan-European standards of protection, and, above all, with a Europe-wide working time policy that leads to wider employment and not its impoverishing distribution via unemployment or precarity at work. A European strategy for equality must be established, among other ways, by imposing codes of responsibility for the environment, working practices, and against discrimination. Europe must modify its position within the structure of international commerce by giving up the cynical principle of free trade demanded of poor countries, but with which neither rich countries nor Europe itself comply, and adopting co-operation and restitution as the ordering principles of international exchanges. The financial markets must be taken on and every effort must be made to repress speculation.
The European leaders can persist and keep proclaiming, as Barroso has just done, that “there is no alternative” but by doing this they are only going to bring about an irreparable outrage among the citizens. The citizens, sooner or later, will take to the streets to kick them out and avoid disaster, by peacefully imposing a different economic policy in the service of people and based on a genuine democracy.