The economic crisis, austerity measures, and
resistance in Europe
PUBLISHED ON JULY 8, 2011
Governments in Europe are responding to the world economic crisis by
tightening control by the European Union and forcing an intensified
implementation of neo-liberal measures to compete with the US. Hard-hit by
these measures are the working people who are now rising up, conducting
massive strikes and protest actions.
By INA ALLECO R. SILVERIO
In recent months, the focus of the international community has been on
southern African countries because of the widespread protests against
unpopular governments and presidents strongly alleged to be backed by the
United States. These uprisings are popularly recognized as manifestations
of people’s strong disgust and discontent against deep-seated corruption
in government and their failure to stop the continuously deteriorating
quality of life.
The global economic crisis has severely affected the impoverished
countries of the south, but according to Wim De Ceukelaire of human rights
group Intal Belgium, Europe has also been hit hard and the effects have
sent economies into a tailspin.
In presentation he made to the 4th International League of Peoples’
Struggles (ILPS), De Ceukelaire said that European governments are
challenged to reinstate stability, particularly in the eurozone. He said
the gap between the strong economies under the leadership of Germany and
the weaker economies in southern and eastern Europe is increasing.
The eurozone is an economic and monetary union (EMU) of 17 European Union
(EU) member states that have adopted the euro as their common currency.
The eurozone currently consists of Austria, Belgium, Cyprus, Estonia,
Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the
Netherlands, Portugal, Slovakia, Slovenia, and Spain. Of the 10 EU member
states outside the eurozone, seven states are obliged to join, once they
fulfill the strict entrance requirements.
“How can an economic union and a common currency zone survive when
Germany’s trade surplus is breaking records while Greece and Portugal are
all but bankrupt? German capitalists do not feel like paying for a
solution to problems of the Greeks or Portuguese,” he said.
According to reports, European President Herman Van Rompuy established a
“task force” to look for solutions to the crisis, but it was German
Chancellor Angela Merkel who held the pen.
“This is how a a proposal took shape during the European Summits of 2010 —
they wanted to establish some kind of a “European Economic Government.”
The solution they were providing was supposedly simple: everyone is
supposed to follow the so-called “German model” of harsh neo-liberal
economic governance. In Germany real wages went down by five percent in
the past 20 years. Unemployment benefits are now a meager € 450 (US $644)
after one year, that is if the individual beneficiary has sold his house
at least. Poverty is also on the rise,” he said.
All over Europe, unemployment rates are increasing. According to Visual
Economics.com: Austria registered an unemployed rate of 4.5 percent,
Belgium 7.4 percent, France 8.8 percent, Germany 8.3 percent, Greece 9.1
percent, Spain 18.7 percent, Sweden 8.9 percent, Netherlands 4.4 percent
and France 8.8 percent.
De Ceukelaire said that the concept of European economic governance was
hatched and finalized all throughout the year 2010, with the Belgian
government at the head of these efforts. He explained that during the 2011
Spring European Council, an EU Economic Governance pact was signed.
“The pact puts national governments under tight European surveillance.
Instead of the European Commission making recommendations, it has been
authorized to verify the concrete commitments of member states with regard
to budgets, labor policies and pensions and to penalize them if they do
not comply,” he said.
To make a point, De Ceukelaire cited the case of his own country.
“For instance, when one Belgian negotiator was asked during the prolonged
government negotiations what his preferred coalition was, he answered that
it didn’t really matter whether there would be a left or a right
coalition. He said, and I quote: ‘There will be a government that will
implement the dictates of the European Commission.”
The difference between the way European governments are run now and how
they previously operated is stark: governments now have to submit their
plans beforehand instead of waiting for the European Council’s judgment
after the plans have been implemented.
“Plans are now evaluated by the Commission
every June, and this judgment is ratified by the European Council before
the end of the month. National governments are supposed to take these
assessments into account when drawing up their budgets for the following
year, and especially reforms of health care, labor market policy,
education and pensions. Member countries that fail to obey can be punished
with sanctions. The consequences of this kind of “economic governance” for
social policies can be tremendous, as the examples of Greece, Ireland and
Portugal are already demonstrating today,” he said.
Europe patterns economic plans after the US’
For all the new changes and arrangements in how the European governments
are operating the business aspect of their administrations, the content of
the economic programs, however, remains the same.
“The method might be new but the content is not. A general characteristic
of the European plans is that the US serves as their model. This is no
coincidence. For more than 60 years, the biggest US capitalists have ruled
the world economy and manipulated it to serve their interests. In the
meantime, the “emedies” the US adapted to stave off the crisis of
overproduction have heavily influenced economic and financial policies in
the European Union,” said De Ceukelaire.
The whole process of neo-liberal reforms in Europe accelerated in 1992
with the Maastricht Treaty. Formally known as the Treaty on European
Union, it was signed in Maastricht, the Netherlands, on February 7, 1992.
It represented a major step by its signatories toward European economic,
political, and social and most importantly monetary integration. The
treaty was signed by Belgium, Denmark, France, Germany, Greece, Ireland,
Italy, Luxembourg, the Netherlands, Portugal, Spain, and the United
In anticipation of the single currency, national economies had to be
streamlined. Issues of budget deficits and public debt were exposed and
scrutinized. In many fields of business, finance and economic
administration, the EU and its member states began copying US policies
“The EU states began implementing tax reforms that benefitted big
companies. They privatized social security, and completely deregulated the
market. There was strong reliance on the stock market and it was developed
to an excess. On the other hand, social benefits for workers and other
sectors of the working people were slashed. Since the early 1990s, the EU
has been imposing the liberalization policy in the industries of
telecommunications and railways, as well as the postal services. The
formerly public services became new fields for profit for private
capital,” De Ceukelaire said.
These policies resulted in massive lay-offs, erosion of the salaries of
government employees and their working conditions. The immediate effect on
the greater public was the deterioration of public services. In the
meantime, because of the Bolkestein directive, the services that were
provided by the private sector were further liberalized. Policies on
wages, social security and the labor market, however, were still decided
at national levels.
Proponents of the directive said that it aims to create a free market for
the services sector by removing the legal and administrative barriers that
supposedly hinder businesses from offering their services in another
country. The directive aimed to encourage cross-border competition, and it
covers a vast range of businesses such as hotels and restaurants, car
rentals, construction, advertising services and estate agencies. It also
covers advice provided by professionals such as architects, and certain
public services, such as social care and environmental services. Excluded
were a number of areas, including broadcasting, postal services,
audiovisual services, temporary employment agencies, social services,
public transport and gambling and healthcare.
Opponents insist that the directive will push down wages, lower standards
of social and environmental protection
In the meantime, the European Union has also put together its Lisbon
2000-2010 strategy. This was supposed to make Europe “the most competitive
and dynamic knowledge economy in the world.”
The rat race to the bottom
De Ceukelaire explained that the Lisbon Agenda set standards for an
overall employment rate (70 percent by 2010), and set the retirement age
higher. Member states were given good and bad points to exert moral
pressure but there was no enforcement of these policies. It was a
so-called open coordination.The goal is, by 2010, for the EU to surpass
the US in competitiveness and productivity and to confront the future
threat of positions lost to rising powers such as China, Russia and India.
To enable European companies to compete with their US counterparts, the
exploitation of the European workers had to become more intense and
comprehensive. Capitalists added new concepts to their arsenal such as
“flexicurity” (supposed job security in exchange for working extremely
flexible hours); “employability” (the availability of workers for the
labor market at any time); and “activation” (forced integration in the
labor market) of the unemployed, elderly and even handicapped people.
“This kind of competition with the US is nothing but a rat race to the
bottom as regards social rights and welfare,” said De Ceukelaire.
EU member states further reduced social
security system benefits such as pensions, health and welfare. They also
abolished collective labor agreements and replaced them with contracts for
“alternative employment.” Concretely this meant work contracts valid only
for a specified period or for part-time arrangements such as occasional
employment, “zero hour” contracts, distance employment, and piecework.
Companies were also emboldened by the new economic strategies to
deregulate dismissals on the one hand, and to strengthen the systems for
so-called “tripartite employment relations.” This meant that workers were
perpetually “for hire” and businesses no longer have the responsibility to
uphold labor laws pertaining to job security and benefits.
Rulings by national and Community courts or the Court of Justice of the
European Communities have also begun on the warpath against workers
rights, characterizing strikes as illegal and abusive. The courts argue
that strikes are in violation of “Community law” and “the Four Freedoms.”
The Four Freedoms refers to the frontier-free area the EU establishes
within which (1) people, (2) goods, (3) services and (4) money can all
move around freely.
Protests in Portugal and Greece
The international economic crisis has hit European countries hard, but
among those most severely affected are Portugal and Greece.
De Ceukelaire said that Greece suffered most from the crisis in the
eurozone. He said that the Greek government has launched a number of
austerity reforms in order to assure itself of bail-outs from the EU and
the International Monetary Fund (IMF).
In the last two years, more than € 45 billion (US$64,430 million)have
already been saved by cuts in government programs or collected in extra
taxes. Despite this, however, public debt has risen from 135 percent to
156 percent of the Gross National Product (GNP).
Within one year, unemployment increased by 40
percent. Among the youth, 42 percent are unemployed. In 2010, the Greek
economy shrank by 55 percent. There was a 21 percent increase in the
value-added tax on many basic necessities. The government agreed to
privatize assets for € 50 billion (US$71,590 billion): airports, railways,
power plants, even its tourist beaches.
“So far, the shock therapy had no effect and yet prices are skyrocketing
while the average income of the Greeks dropped by nine percent in just one
year,” he said.
In Portugal, the wages of public employees have been frozen until 2012.
The minimum wage, in the meantime was lowered to €485 (US$494) The
government raised VAT on many basic products. As a result the price of
bread increased by 10 percent and electricity by six percent. The taxes
paid by banks, however, were slashed by halved.
According to De Ceukelaire, the protests against the global economic
crisis and the crisis in Europe are strongest and most organized in
Portugal and Greece. This is no coincidence, he said, because the two are
among the countries hit exceptionally hard. “Both countries are also home
to a strong labor movement and communist parties,” he said.
The Portuguese Communist Party (PCP), with no less than 400,000 members,
is at the heart of protests. In November 24, 2010, more than three million
people took to the streets in protest of the proposed austerity measures.
The government proposed cutbacks on public spending as well as wage cuts
for public workers, and it was no surprise that and 75 percent of the
protesters were workers.
The protests including strikes, which affected the transport sector,
grounding flights and causing the cancellation of some bus and train
services. Banking services and other businesses were also affected.
Observers said that the stoppage was biggest in 20 years.
De Ceukelaire said that the PCP led the discussion at all levels, from its
local groups in factories up to its representation in the parliament. He
shared that the party also had a strong showing in the recent elections,
securing two seats in the national assembly out of a total of 16. It also
posted the highest vote total of the 21st century despite a voter turnout
of less than 60 percent nationwide.
In a message to the public, the PCP’s secretary general Jerónimo de Sousa
said that that the protests had its roots in the consolidation campaign
they built since the elections. According to him, there was widespread
awareness about the country’s real problems and about those responsible
for the crisis.
In Greece, the most visible expressions of people’s protest were the
massive rallies in the streets of Athens and other big cities and general
strikes. While protests continue, people’s committees were established in
neighborhoods and villages across Greece. Workers, farmers, independents,
women and youth organized to strengthen resistance.
The people of Greece bannered the issue of health care during the
protests. They called for free health care and higher allocations for
public hospitals. In the regions, the focus was on access to care for the
unemployed. In Larissa, a city in the center of Greece, the elderly joined
protests; they occupied the offices of the social security agency and
demanded a meeting with the director.
Topple the government colluding with the IMF
Nikos Noulas, an ILPS delegate from Greece and representing the Union of
Working People group, explains that the nationwide protests in his country
are against the “troika” comprised of the International Monetary Fund,
European Union, and the European Central Bank.
“The people of Greece will continue to hold militant but peaceful mass
demonstrations in our country’s various squares (plazas and public
gathering areas) to demand the removal of the troika. We are also
demanding that Prime Minister George Papandreou steps down immediately,”
Noulas explained than since May 24, thousands have gathered in a protest
camp in Syntagma Square in Athens. They have put up tents and makeshift
kitchens and daily hold programs and discussion groups on the economic
issues affecting Greece.
“We know the problems, we know the culprits behind them: what we want now
are solutions. The only solution we want in the immediate is for the
leaders of government colluding with the IMF, EU and the European Central
Bank to step down,” he said. He explained that among the popular symbols
in the Greek protests are that of a stylized helicopter.
“It symbolizes what we want: for all the corrupt officials in government
to get on a helicopter, leave the country and never return. The protests
that begun on May 24 continue to this day, and we don’t see them stopping
any time soon. The people of Greece are united in demanding change, and we
will not stop until we overthrow this government and ” he said.
On June 15, police lobbed teargas outside the Finance Ministry where a
mass protest while taking place. Syntagma Square was quickly enveloped in
fumes which included asphyxiant gas, which is said to severely inhibit
breathing. Stun grenades also exploded.
“The government used violence against us, but we were not cowed. We are
inspired by the protests in Southern Europe — in Portugal and in Spain; we
are inspired by what the people of northern African countries are doing —
taking history in their hands and ousting corrupt presidents. We know that
it is possible to change the situation the country is facing; and we want
to change the country’s direction. The path set by the troika is not one
we want to follow, not even for a single day; we will set a different
path, go toward a different direction where we can realize true national
independence and lay the foundations for socialism,” he said.
The economic crisis continues to sweep through Europe, but like what is
happening in Africa, the people of Europe especially the sectors of the
working people are not taking things sitting down.
At the end of his presentation, De Ceukelaire said that in discussing
people’s resistance in Europe, certain conclusions can be made.
“First, monopoly capital exploits the working class not only in its former
colonies but also in Europe, and the current economic crisis has sharpened
the class contradictions at home. Second, the strength of the labor
movement matters in these circumstances. Without solid trade unions,
popular committees and workers’ parties, the future of the resistance
movement is uncertain. It is where these organizations are taking strong
roots among the people that the resistance has the best prospects. Third,
reactionary forces are still strong in Europe while the forces of
resistance are relatively weak. As the crisis of capitalism is worsening,
its inability to solve the rising contradictions will become clearer for
the workers. The challenge is to consolidate their organizations so they
will be able to tilt the balance of forces in their advantage,” he said.
The global economic crisis has severely
affected the impoverished countries of the South, but according to Wim De
Ceukelaire of human rights group Intal Belgium, Europe has also been hit
hard and the effects have sent economies into a tailspin. (Photo by Ina
Allecco R. Silverio / bulatlat.com)
COMMISSION 2: Socio-economic Development &
World production of material wealth has gone global, bringing peoples and
nations closer together. Yet, at the same time, poverty grips a swelling
number of destitute people trying to survive on less than $2-a-day,
estimated at 1.2 billion or nearly one-third of the global labor force in
Addressing the socio-economic roots of poverty, unemployment, rising food
prices, budget cuts for public services and other social ills, an
international gathering of progressive organizations and movements
convenes in Manila, Philippines this July.
Led by the International League of Peoples’ Struggles (ILPS), hundreds of
delegates from 39 countries are set to share insights, discuss and resolve
to intensify the struggles for employment, decent incomes, better working
and living conditions, access to social services, and control over land,
water and other productive resources.
This resolution is part of the three-day event where the general call of
the ILPS to build a brighter future is bannered.
Facing financial goliaths
The ILPS assembly resolves to fight the international financial
institutions and the G-20, virtual goliaths in the world economy, for
their policy agenda of privatization, disemployment and austerity
measures. “Greater socialization” became a clarion call for the assembly.
Paul Quintos, a Filipino resource person for the event, said that “women
and men should fight for the universal right to find decent and productive
work that ensures security and human dignity. This also means work that is
engaged in meeting social needs for the present and future generations,
including access to food, education, health, housing and basic services
The ecological crisis is also confronted by calls “for the fundamental
reorientation and reorganization of production and consumption towards
meeting social needs rather than endless profit-seeking and capital
“Such a demand inspires broad-based struggle for a just, democratic,
peaceful and sustainable world,” Quintos said.
“This will help people realize that sustainability can only be made
possible by collective ownership and social-planning,” he added.
Cooperation, not competition
The assembly noted that, with demand and prices for commodities on the
rise, monopoly firms are frantically competing for and violently taking
over vast tracts of land, forests and marine resources for the extraction
and export of oil, food, minerals and other resources throughout Africa,
Asia, Latin America and the Caribbean.
Hence, the ILPS called for strengthening the people's struggles for
ownership and control of productive resources and greater cooperation
among peoples in trade. It cited the case of the Bolivarian Alternative
for Latin America and the Caribbean (ALBA) led by Venezuela and Cuba as a
regional alternative to the US-led Free Trade Area for the Americas.
Closer to home, the assembly said that “for many of the least developed
countries, Chinese or Indian trade and investments provide alternatives to
EU or US capital and markets.”
”Greater south-south cooperation objectively provides greater elbow room
for oppressed countries to collectively assert their independence and
development for their people.”
That assertion complements the greater resistance and protests on going in
the world today – to which the ILPS assembly expresses its international
COMMISSION 3: Human Rights in the Civil,
Political, Economic, Social and Cultural Fields
On February 14, 2008, Guatemalan indigenous rights leader Ramiro Choc was
arrested by six armed soldiers and sentenced to six years on trumped up
charges of aggravated robbery, land stealing, and kidnapping. On the third
year of his incarceration, three of Choc’s colleagues at Encuentro
Campesino, a peasant organization he helped form, were found dead, each
shot multiple times. Choc is one of the 592 cases of criminalization of
defenders of human rights in Guatemala between 2004 and 2009, according to
Unidad de Defensores/as de Derechos Humanos en Guatemala (UDEFGUA).
In the Philippines, peasant leader Dario Tomada survived an assassination
attempt in Kanangga, Leyte but ended up in jail on July 22, 2010. He was
charged with murder that took place almost three decades ago. Tomada is
but one of the more than 340 political prisoners languishing in 67
detention centers in the Philippines.
In Iran, prison guards are reportedly facilitating rape of young
opposition activists by giving out condoms to criminals. In its 2010
report, Amnesty International documented the rape of male and female
detainees by security officials.
In Burma, despite the release of a handful of political prisoners, many
continue to serve unduly harsh and extreme prison terms with over 200
serving 20- to 50-year sentences, 54 serving 51-to 106-year sentences, and
91 serving life sentences.
At the Guantanamo Bay detention camp, suspected terrorists undergo severe
forms of torture including sleep deprivation, exposure to hot and cold,
bright lights, and loud music during interrogations.
These tales of torture, maltreatment and imprisonment based on fabricated
charges are carried out by state security forces of governments waging
wars against their own peoples. In its May 2011 report, Amnesty
International reported that there are 98 countries who practice torture
and other ill-treatment, unlawful restrictions on freedom of expression in
89 countries, and prisoners of conscience in 48 countries.
In the case of United States, the entire world has become a war zone. With
its “targeted killing” program, the Obama administration has authorized a
program for the killing of suspected terrorists anywhere.
In its review of the 18 months of the Obama administration, the American
Civil Liberties Union (ACLU) said: “Indeed, on a range of issues including
accountability for torture, detention of terrorism suspects, and use of
lethal force against civilians, there is a very real danger that the Obama
administration will enshrine permanently within the law policies and
practices that were widely considered extreme and unlawful during the Bush
In May, Obama signed a four-year extension of the USA Patriot Act that
allows private security firms under the supervision of the government to
monitor and search American citizens' phone conversations, email
communications, medical, financial and official records to discover
“potential terrorism-related threats and foil the probable plots which can
jeopardize the country's domestic security.” Roving wiretaps,
court-ordered searches of business records and conducting surveillance of
individuals engaged in terrorism-related activities without being linked
to renowned terrorist organizations are allowed.
Since the September 11, 2001 attack, the U.S. government prodded other
countries to enact so-called anti-terrorist legislations that contain
similar draconian measures.
Since the 9/11 attacks, too, U.S. special forces have nearly doubled in
number, their budget nearly tripled, and their overseas deployments
quadrupled. The Special Operations Command's overall strength now stands
at roughly 60,000 in 79 countries. They are engaged in counterinsurgency
operations that aim, according to the head of the Central Intelligence
Agency, to “disrupt terrorist plots and training facilities, thin out the
terrorist ranks, and pre-empt insurgencies before they can escalate into
threats to U.S. security.”
The U.S. government also continues to support repressive regimes such as
Israel that has occupied Palestinian territories. Despite condemnation of
Israel’s offensive attacks such as the attack on a flotilla attempting to
break the Gaza blockade on May 31, 2010, Israel remains the largest
overall recipient of foreign aid from the United States since World War
II, receiving US$2.775 billion in military aid in 2010.
In the Philippines, the new Aquino government adopted the US
Counterinsurgency Guide. Even as the Armed Forces of the Philippines (AFP)
portrays itself to be respecting human rights with its psywar tactics, at
least 48 have been victims of extrajudicial killings, five were victims of
enforced disappearances and hundreds were victims of harassment and
threats. Like Israel, the Philippines is a recipient of US military
assistance, receiving US$32 million in fiscal year 2009-2010 under Foreign
Military Financing for procurement of US military equipment, services, and
As in the past, the US has instigated state terrorism. It provides
indoctrination, strategic direction, officer training and military
equipment to the state apparatus of repression.
The International League of Peoples’ Struggle (ILPS), in its fourth
assembly in Manila, Philippines this July, condemns all these human rights
violations perpetrated by the US and its client states.