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Austerity And Anger

  • September 30th, 2010
  • Posted by EUEditor

europ-demos-2.jpgCOMMENTARY: Thousands have come out on strike in Spain, and have joined protests in the streets of Brussels, and other cities across Europe, all opposing the impacts of austerity budgets.

TIGHTENING GRIP ON WAGES

As the squeeze takes hold, where will it lead?

The sight of 5000 police officers out on strike in Bucharest this week was bound to have a worrying effect on citizens to say the least.

Romania is not the most serene country; has a history of lawless behaviour over the decades, from the top of government down, and currently is grappling not well with organised crime –to the concern to European Union administrators.

So what is happening that police were so publicly taking their eye off the ball?

Behind it are pay cuts of 25%.  The contracting national economy, reeling after the shock of the financial crisis of 200708, has put pressure on the government to cut deeply. Wages throughout the country are suffering deep cuts; pensions down by 15%.

CUTTING ON A MAJOR SCALE

It is much the same at different levels of severity throughout the European community.

Bail-outs for the banks were funded in the heat of crisis to prevent the worst crash, but it came after periods of extended government borrowing, and so austerity budgets have followed.

The harshness of it is the extent of the cutting, unambiguous attack on incomes and long-held benefits, pensions included, as often as not thought to have been secure because under plans involving employee contributions.

ANGRY RESPONSE

europe-demos-1.jpgSo the angry response, building up in strength during this year at least, displays both desperation and a sense of betrayal.

Delayed retirements, cut pensions or family benefits, scrapping of public service jobs in the face of stubborn, continuing unemployment, inevitably must slow, or stall the “growth and jobs” campaign being piloted from Brussels.

That drive for expansion based on productivity measures has produced some returns; the European Commission recurrently produces figures showing a steady, if cautious recovery from the recession.

BALANCE SHEETS VERSUS REALITY OF DAILY GRIND

But it becomes a theoretical recovery, on paper, in an unreal economy, where job s may be created but joblessness persist; where growth does not get through to the level of family incomes.

Trade unions in Europe have watched in indignation and great alarm; mobilisation and industrial action is a tall order ion times of austerity and masses out of work, soon to go that way.

Funding the blunders of bankers with money gouged from the workforce, they say, will bring no spending and investment form the level of the community; can recovery continue with this massive sea-anchor slowing it down.

This week, they have called the day of action  (29.9.10).

“STAMPEDE TOWARDS AUSTERITY”

Protestors on the street in Madrid, supporting a general strike,  targeted the austerity in Spain, government spending on the way to reductions in the order of 8%.

Similar actions in Brussels, (where as often as not, demonstrations will become tumultuous), are targeted in part against the EU – not for its moves to regulate the financial industry or organise huge funds to head off defaults in national borrowing, but for its endorsement of budget cutting deemed necessary because of the extent of public debt.

A spokesperson for union groups from 30 countries, which converged on Brussels for the day, said: “The stampede towards austerity must be stopped and reversed.”

Crowds in the city were estimated at 100000 strong.
SAME STORY, MANY PLACES

A sampling of the state of affairs in different corners of the European Union is indicative.

Ireland this week, after a sequence of deep-cutting, and traumatic austerity plans, the government’s credit rating took a fresh cut from the agencies – making repayment more difficult, aggravating the pressure.

The Greek government has been drawing on the emergency fund provided for it by the EU, being unable to service debt without; still struggling to step up with the taxation collection an d anti-corruption measures it recognises as necessary to arrest the downward spiral.

The United Kingdom has declared its across-the-board public spending cuts in the order of  20-25% , a convulsive, hurried remedy for anxieties over gross government debt –  deficits at 11% of GNP.

The BBC reported on Wednesday demonstrations had been taking place not only in Belgium and Spain this week, but in Greeece, Italy, Ireland and Latvia.

It has published a round-up of the government austerity measures in ten of the European countries, see http://www.bbc.co.uk/news/10162176, (30.9.10).

Governments of whatever tendency have signed on for a binge of “correction” and “strong measurement”; they have been faced with a fait accompli – production under stress, and no money, or far too little, in reserve.

Again, at community level, crisis means a far different reality: no work, no money, the spectre of a hard life, no end to it in sight; balance sheets are not bread on the table; something’s got to give.

Reference

BBC News, London, “EUausterity drive, country by country”, 28.9.10.http://www.bbc.co.uk/news/10162176, (29.9.10).

Le Monde, Paris, Le Ministre de l’interieur roumain demissionne apres une manifestation de policiers, (Resignation of the Romanian Interior Minister following police demonstration), 27.9.10. www.lemomde,fr, (27.9.10).

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