After the social and political Greek crisis, shall we build another Europe?

European Social Forum, Thursday 1 July 2010

Contribution of Francine Mestrum

(www.globalsocialjustice.com)

First of all, let me briefly refer to the US Social Forum of last week in Detroit. This grassroots forum
was really excellent.

But what I want to refer to here, is the city of Detroit, because I want to use this example for what I
fear might be awaiting us in Europe.

Detroit has slowly been abandoned, starting in the 60s. Detroit was the city of the car industry with
very activist, strong trade unions and hence, well paid qualified workers. Because of this, many
factories left Detroit and went to surrounding cities in order to benefit from lower wages. In the 80s
nevertheless, these factories (General Motors, Ford, Chrysler …) lost the competition race with Japan
and other Asian countries. Other factories in Detroit, (steel and chemical industry, refineries …) had
to cut down as well.

Detroit had 2 million inhabitants in 1980, but today has only about 800.000, 80 % of them blacks. The
center of Detroit is empty. Houses and office buildings are abandoned. In the end, they are torn
down and leave ‘holes’ in the streets and the city. There are no shops, no supermarkets. There are
three casinos and two sports stadiums that are meant to keep the city ‘alive’.

What is left of Detroit are the six office towers of General Motors and a conference center. The city is
surrounded by a very polluting industry (waste management, steel, chemical industry, refineries (tar
sands) and a very poor population with 50 % of unemployment, much lung and brain cancer and a
majority of children with asthma.

Why do I tell you this?

Because I fear that this might also be the de-industrialized future of Europe. The countries of Eastern
Europe and the former East Germany, already know what it means to lose industries and
employment, to see how cities are abandoned and how people are impoverished.

Western Europe has been, up till now, the last wealthy island with social protection and public
services in a neoliberal world. This neoliberalization, with the development of poverty and inequality,
the development of an informal economy and the dismantling of social protection and public services
has started in Latin America and Africa, it then hit the US and the UK, it hit the former socialist world
after 1989 and it hit the Asian countries in the 90s. Now is the turn for the European Union.

Our elites and the financial markets have decided that public expenditures have to be cut down,
welfare states and pensions have to be reformed, public services already are being privatized.

The question then is, how can we react?

Let me say one thing: it is not enough to say ‘no’. It is not enough to resist. We urgently need
alternatives.

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I do not want to be pessimistic, but I do not believe that we will be able to stop policies and a
development that have already conquered the rest of the world. Europe will not be able to survive as
a wealthy island in an impoverished world. If we want another Europe and another world, we will
necessarily have to organize at a European and at a global level.

European ‘social’ policies

We should not expect the European Union to come spontaneously with any ‘social’ solutions.

In the first place because, for many years , there has hardly been any social legislation. European
policies aim, rhetorically, at growth, more jobs for more people, but without any concrete policies.
Employment policies are a ‘matter of common interest’ but they have to be put into place by the
member states. There are no proposals for improving social protection, on the contrary. There is a
green paper on labour law, there are proposals on flexicurity and we have the judgments of the
Court of Justice putting economic freedoms before social rights. Since the strategy of Lisbon in 2000,
public services are being dismantled.

In the second place you will have noticed that, today, we live in the European Year for fighting
poverty. What does it mean? Almost 100 million people in the EU live at a ‘risk of poverty’. There is
no real, concrete strategy to help them. In fact, if you analyze the European documents on poverty,
you can see that a couple of recurrent points are always mentioned. They are:

- The need for growth, budget restraint and the financial sustainability of social protection,
which are all characteristic for a neoliberal agenda
- The modernization of social protection, without ever specifying what it means, but which can
easily be translated into the cutting down of allowances
- The activation of unemployed people, called ‘active inclusion’.

Furthermore, it is easy to see that from the end of the 80s, the objectives of social policies have been
changed. Where the old documents talk of guaranteeing incomes and even of the need to harmonize
social security in Europe, they now focus on avoiding their negative impact on the single market and
of ‘making work pay’, implying that unemployed people are willingly unemployed and should be
stimulated to find a job. But they seem to forget one thing: the lack of decent jobs.

In this way, we can see that the poverty focus of the European Union is perfectly compatible with its
neoliberal policies and may in fact hide the dismantling of national social protection. This is precisely
the strategy that the World Bank has used in the third world. They prioritize ‘poverty reduction’ while
in fact saying that social security should be abandoned altogether or being left to the private market.

Thirdly, this strategy is now even weakened in the new 2020 strategy. Again, it contains the recurrent
points of fiscal restraint and growth. Social protection is not even mentioned any more, only the
reform of pension systems. We know what it means.

Poverty is mentioned in the last point of the Council conclusions of June 2010 where it says that the
new strategy wants to promote social inclusion, aiming ‘to lift at least 20 million people out of the

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risk of poverty’. But how? We do not know. A footnote says that member-states can choose their
own indicators. This is certainly not an ambitious programme!

Neoliberalism and the re-scaling of policies

This state of affairs should not surprise us. The European Union has no competences for social
security and there are some doubts on its possibility to really tackle poverty. The treaties do not
mention poverty, only labour markets and social exclusion.

We should also understand that what the European Union is doing at the European level, would be
much harder to achieve at the national level. Our national governments know this very well and that
is why they come together in Brussels and talk to themselves and say to themselves what they have
to do. They then go back home and say that ‘Europe’ decided they should do this or that. But
‘Europe’ is nothing else than the reflection of what national governments do and want to do.

Decision-making at the European level has two advantages:

- It can hide the will of national governments who prefer to blame ‘Europe’
- It can avoid the existing power of social movements and trade unions at the national level.
National states, the level where democracy takes place and where resistance can be organized, are
being disempowered. This is what neoliberal policies are all about. What is happening at the
European level is the construction of a policy space with minimal democracy and maximum
repressive power. It is not only the Commission we have to blame, but also and maybe most of all
our own national governments. They decide that markets should be allowed to function as they want
to function. This is neoliberalism as it was intended to be.

In most of our member states then we see, at the social level, a shift from public social insurances
towards a ‘floor’ protection, or in other words: from social security to poverty reduction. We should
not let it happen.

What can we do?

We have no time to lose. Financial markets have decided that this last island of wealth, with social
protection, public services and labour rights, has to disappear. Deregulated capital is at our
doorsteps. Let us be serious about taking this crisis as an opportunity. And let us be clear about one
thing: the major crisis we are faced with is at the level of people, at the level of you and me, at the
level of workers, at the level of the unemployed, at the level of migrants, at the level of the
homeless…

A first thing we need is more empirical studies to show that countries with strong social protection
were best in withstanding the economic crisis. Social protection does not hinder growth or
competition , for those who want it. Moreover, public services contribute to social stability. The
arguments of our opponents are not valid and we need evidence to show the importance of social
protection and labour rights.

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We also need more evidence to show that the best way to fight poverty is a strong social protection.
At the European level, poverty falls from 26 to 17 % after social transfers. The correlation between
social transfers and the reduction of poverty is particularly strong for children. A shift from social
security to poverty reduction is particularly bad for the poor.

We also urgently need alternatives, concrete and attractive economic and social alternatives. We
need an alternative growth model, a new development paradigm. Here, I think we have all the
elements, but we have not succeeded yet in aggregating them in a broad and new programme that
can seduce people, that can convince people that they are a real solution. Because we have to
change, we cannot just denounce neoliberalism and defend some kind of socialism that people do
not want. We should analyse the reasons why European workers are turning to the right and the
extreme-right. Vulnerable people want protection and we have to offer that protection in a new and
attractive way.

In the meantime, we should ask the European Commission and our national governments for
European legislation on three points:

Firstly, rules on a minimum income for all in the European Union, defined according to the national
income of each country, so that no one has to live with an income below the poverty line of his/her
country. This legislation was promised beginning of the 90s in a recommendation of the Council and
was repeated by the Commission in its last social agenda.

Secondly, legislation with minimum criteria on services of general interest (or public services). Too
many services have already been liberalized and privatized and many others are threatened. We
need transversal rules that have to be respected in all cases so that people everywhere have access
to affordable services.

Thirdly, we need social convergence criteria in the same way as the Treaty of Maastricht introduced
economic convergence criteria. Social convergence can apply to social protection, labour law and
wages. Competition at the level of workers is the most negative consequence of this lack of
convergence.

And finally, why not declare poverty as being illegal? As one of the wealthiest regions of the world,
why should we accept the existence of poverty?

Let me conclude. We probably all like to be radical and make strong declarations and proposals. But
maybe, in these urgent circumstances, the priority should be to make compromises in order to make
broad alliances with other partners. We need an alliance with the trade unions and with all social
movements who want social change and social justice. We need to work at the national, the
European and at the global level. I know it is not easy, but we have no choice. We have to do it and
we should start now. Five million jobs have been lost in 2008-2009 throughout the EU. More than
100 million people live near the poverty line. This is unacceptable. It is also our responsibility, the
responsibility of all of us. In different countries, extreme rightwing parties are gaining power:
Hungary and Slovakia, even Holland and Belgium. Nationalism is on the rise. We cannot risk a revival
of the strategy of the 30s of last century. We have to act. Not only by resisting but by working hard
with others to try and offer a new utopia.

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So, my answer to the question of this seminar is: yes, we have to build another Europe. Urgently. And
this urgency implies that, in my view, the shortest way to another Europe is this existing Europe. We
do not have time to start afresh, to think of new institutions, to make tabula rasa of what exists now.
Let us join with others, the trade unions in the first place, to change this existing Europe, to make it
more democratic and more social. And let us build a strong counter hegemony for making another
Europe in another world. Because another Europe is possible.