Further austerity imposed, democracy attacked – the third bailout of Greece in July 2015 has demonstrated the brutal face of neo-liberalism in Europe. Refugees in need at the doors of Europe and the governments of the European Union (EU) member states are squabbling over the allocation of small numbers of refugees across the EU, numbers which the comparatively wealthy EU should easily be able to accommodate. These events provided the dramatic background to this year’s EuroMemo Group’s conference Addressing Europe’s Multiple Crises: An agenda for economic transformation, solidarity and democracy, held at Roskilde University/Denmark, 24 to 26 September. In this blog post, I will make some personal observations.
An alternative economic policy for Europe
The main themes of the conference were organised in five parallel workshops. Workshop 1 dealt with macroeconomic policies. Austerity policies are clearly not working and the Stability and Growth Pact functions as an obstacle to growth. Could a significant fiscal stimulus across the European economy be a way out of crisis, perhaps partly funded through successfully combatting tax evasion by big corporations?
Workshop 2, in turn, focused more closely on Economic and Monetary Union (EMU) as well as the response by EU institutions to the crisis in Greece. Can we actually still argue that a restructured EMU would provide a possibility for more progressive policies within the EU? Is it time to discuss also the possibilities of exiting EMU and would it not be important to engage with discussions around a so-called Plan B?
Persistent high levels of unemployment and the refugee crisis provided the background for Workshop 3 on Labour markets, demographic change and migration. Here too, austerity is considered to be a dead end. How can European governments pursue widespread cuts and at the same time argue for solidarity with refugees? These discussions related closely to increasing precarious work and higher poverty levels in Europe, and especially the extremely high rate of unemployment among young people, covered in Workshop 4.
Workshop 5, finally, dealt with the EU’s external relations and here especially its free trade policy around the negotiations of the Transatlantic Trade and Investment Partnership (TTIP). The expanded free trade regime embodied in TTIP and including such elements as the investor-state-dispute-settlement mechanism and attempts at cooperating to deregulate economic sectors is clearly a significant danger to national sovereignty and democracy as well as consumer and workers’ rights. Nevertheless, what could an alternative trade regime look like?
As interesting as these discussions are, what makes this EuroMemo Group conference so important is that it does not stop at analysing developments. Its real purpose is to develop proposals for an alternative economic policy in Europe. For 20 years, the group has published an annual report and the same will happen again in January 2016 as a result of this meeting. This is clearly the most significant aspect in which the EuroMemo Group goes beyond any other academic conference.
The Economics of the European Constitution: Locking in Austerity?
In an important plenary session on the second day, Augustín José Menéndez from the Department of Public Law at the University of Léon in Spain outlined the way in which the European Union is in a process of locking in austerity into national constitutions through the incorporation of laws committing governments to balanced budgets. By doing so, the EU institutions and current governments are attacking the traditional social democratic Rechtsstaat, which did not commit governments to specific policies, but provided the framework within which a range of different policies could be pursued.
Magnus Ryner from the Department of European and International Studies at King’s College London/UK equally emphasised the change in EU structures. Analysing recent developments from a political economy perspective he emphasised the shift towards authoritarian neo-liberalism in which ‘new constitutionalism’, the shift of power to institutions outside democratic accountability, has been radicalised. The new EU asymmetrical regulation is disciplinary neo-liberal in substance and ‘new constitutionalist’ in form. Underpinned by transnational class formation and an increasingly powerful transnational capital class, he concluded, it is hardly possible to challenge the current order in Europe.
The weakness of capitalism and possibilities of resistance
And yet, although these developments are indeed taking place, it remains important not to exaggerate the power of capital and the stability of the current neo-liberal order. Capitalism is a crisis ridden system and while capital may appear to be back in control after the financial crisis of 2007/2008, we should not forget that there are currently $1.73 trillion of private finance sloshing around the system in a desperate search for profitable investment opportunities. This is to a large extent the reason for why there is this pressure on opening up public services for private investment. While the private sector offers few opportunities for profitable investment, the privatisation of public sectors is deemed to be a potential way out of the crisis of overaccumulation (see Alternatives to privatising public services). Nobody can predict the exact time of the next crisis, but it will come.
On the first day of the conference, Laura Horn from the Department of Society and Globalisation at Roskilde University outlined the current weakness of the left across Europe, unable to challenge neo-liberal restructuring successfully. The defeat of Syriza’s anti-austerity policy in Greece has put question-marks on the left’s ability to mobilise broadly. And indeed, the European left is fragmented and local groups are not well connected at the European level. Nevertheless, popular uprisings against injustice and exploitation can neither be planned nor predicted. They are always a possibility, as remote as this may currently appear.
It remains, therefore, important for forces of the progressive left such as the EuroMemo Group to continue with their work on economic alternatives. In fact, it is not only important, but absolutely essential, if we do not want to leave the field for alternatives to the fascist, populist forces of the right. If the left does not mobilise the exploited masses against the current order, the extreme right will do it. The success of various right-wing parties in Europe such as Golden Dawn in Greece or Folkeparti in Denmark are a clear warning!
Prof. Andreas Bieler
Professor of Political Economy
University of Nottingham/UK
5 October 2015