European Intellectuals Speak Out AGAINST AUSTERITY–and provide an alternative

Editor’s Note:  Tikkun author Ulrich Duchrow, a professor of systematic theology at the University of Heidelberg, Germany, and cofounder and moderator of Kairos Euope, an ecumenical network striving for economic justice (see his article A European Revival of Liberation Theology in Tikkun’s Winter 2011 issue) presents us with a statement of European intellectuals speaking out against the neo-liberal austerity economic programs that are the weapon-of-choice by the 1% in its class war against the 99%. 

Stop the neo-liberal crisis politics – dispossess the beneficiaries!

We are experiencing the deepest crisis of capitalism since the great depression of the 30s – and the European governments continue to pour oil on the fires! From the very beginning, some governments have prevented a solidarity-based solution to the crisis in Europe and are significantly responsible for its exacerbation. This refers particularly to the German government, which, in August 2008, blocked a substantial economic stimulus package for Europe. Hardly had the recession reached its lowest point in Germany in 2009, when the German government preached the necessity for hard austerity policies. The “debt brake” was anchored in the constitution: politics disempowered itself, shaped by neo-liberal ideology. The austerity measures taken in various EU states affected above all wage-earners, pensioners, the unemployed and the self-employed, while the wealthy, the banks and the corporations were spared. In spring 2010 the German government blocked aid for Greece, causing a rise in the Greek national debt and making a solution of the crisis more difficult and expensive. The loan commitments for Greece and other countries in crisis came with obligatory and ridiculous demands which would only make the crisis worse. For example, the reduction in the Greek minimum wage did not contribute to an increase in “competitiveness”, as the country hardly has any internationally competitive industries. Instead, the reduction of the minimum wage destroyed the internal market further. This example makes clear that the current crisis politics redistributes wealth from wage-earners to those who possess the capital, regardless of the macro-economic and societal consequences. Greek salaries have already dropped by 20-30%, hundreds of thousands of people are losing their jobs, over 10,000 schools are closed, hospitals are running out of medication, children are starving. Similar developments are also looming in Portugal and in other European countries.

Neo-liberal politics, whose failure has become obvious in this crisis, is being radicalised once more. The aim of the “fiscal pact”, for example, which was agreed by the heads of state and heads of government of 24 EU states on 2nd March 2012, is to make neo-liberal austerity policies legally binding for all time. A “debt brake” in line with the German model should be anchored across the whole of Europe.  National budget deficits should, in future, be capped at 0.5% of GDP. This plan overlooks the fact that already in the 1990s the “Stability and Growth Pact” agreed by the European Economic and Currency Union, which had allowed a budget deficit of 3% of GDP, could not withstand the reality of a capitalist society dogged by crises. The 3% deficit was frequently exceeded. The “Treaty on Stability, Coordination and Governance in the Economic and Monetary Union”, as the Fiscal Pact is officially called, is more than the result of unrealistic plotting by neo-liberal economists and politicians.  Further waves of privatisation, destruction of jobs, restriction of public services, social degradation, and wage reduction, are pre-programmed across the whole of Europe; and all to protect the profits of a small group of rich capitalists. The destructive policies which have been pushed  ahead mainly by the  German and French governments have been accepted and put into practice by nearly all EU governments, because in every state there is a dominant wealthy clique who profit from the increasing pressure on the wage-earning population.

The European crisis policies lead to an increased undermining and devaluing of democracy. Not least through international pressure were the governments in Greece and Italy removed from office and replaced by a government of “technocrats” in order to calm “the markets”. These governments make far-reaching decisions without having the legitimacy of being elected. A proposed referendum on the austerity measures in Greece was quickly quashed after pressure from the ruling powers. Elections become meaningless when the large parties represent more or less the same policies, as recently in Portugal and Spain. Responsibilities are moved from the national level to the EU-level without an adequate democratic control of the activities of the EU institutions such as the European Commissions, the European Central Bank, or the European Court of Justice. We note with great concern the increased nationalist, racist and fascist movements in various European countries.

And yet the prevailing policies are not without an alternative. A significant alternative, however, is only possible when the roots of the crisis are correctly identified. National debt crises form only one aspect of the current European crisis, in which the tensions of European integration (unequal development, common financial policies without common policies on wages, taxation and industry) collide with a structural over-accumulation of capital. There is too much capital, measured by the possibilities which remain to exploit work and the environment.

An alternative strategy for attacking the crisis needs to include the following elements:

- No ratification of the Fiscal Pact

The Fiscal Pact means further loss of democracy, commits nations to neo-liberal policies, and increases the crisis.

- Cancellation of national debts

A public debt audit must clarify how the debts were incurred and who is in possession of the government bonds. One person’s debts are another person’s wealth. The savings and pension entitlements of the broad mass of the population must be secured, while the interest and repayment entitlements of the wealthy, the banks, the hedge funds and the corporations must be cancelled.

- Nationalisation of the banks

Banks which have been saved by public funds must be nationalised. Banks which are “too big to fail” must be divided up.

- Radical redistribution of income and wealth

We need a tax on financial transactions, an increase in taxation on capital returns, a re-introduction of wealth tax and a much stronger progression in income tax, in order to  achieve a lasting financing of state spending and increase in benefits, and to enable social and environmentally necessary investments, as well as to combat world poverty.

- Overcoming of mass unemployment

Mass unemployment, low wages and wage reduction are important reasons for decreasing wage rates and the creation of surplus capital which inflates the financial sector. There must be an end to the manipulation of unemployment statistics. Mass unemployment can only be overcome by a radical reduction in working hours.

- Democratising democracy

Democracy must be strengthened at all levels, especially at the European level, and must also include the economic sector.  It cannot be possible that democracy comes to a stop at the gates of the factories and the banks, and that a small group has the means of production at its disposal, when human survival depends on it.

The “Arab Spring”, the movement of the “indignant ones” in Spain, the numerous strikes and demonstrations in Greece and the worldwide “Occupy” movement which started in the USA, are all a source of encouragement. It is high time to strengthen the protests and to take them to the place where the European crisis policies are apparently decided. This is why we are announcing the world-wide decentralised protest demonstrations on 12th May as well as the European protest demonstrations which will take place in Frankfurt am Main on 17th-19th May 2012.

Organisations / Networks

  • Attac Portugal
  • Attac Wallonia
  • CADTM Europe
  • Commission on Globalisation and Environment of the Protestant Federation, Italy
  • Kairos Europe, Belgium
  • Legambiente Ecopolis Torino, Italy
  • Specialist Advisory Council of Attac Germany
  • Specialist Advisory Council of Attac Spain

Individuals

  • Prof Elmar Altvater, Freie Universität Berlin
  • Prof Jens Christopher Andvig, Norwegian Institute of International Affairs
  • Cristina Asensi, Board of Attac Spain
  • Prof Amit Bharudi, Pavia University, Italy
  • Prof Adelheid Biesecker, University of Bremen
  • Prof Ulrich Brand, University of Vienna
  • Franco Carminati, Attac Wallonia-Brussels
  • Thomas Coutrot, Co-President of Attac France
  • Carlos Cuesta, Board of Attac Spain
  • Dr Rolf Czeskleba-Dupont, Roskilde University Denmark
  • Yiannis Dragasakis, SYRIZA, Greece
  • Prof Ulrich Duchrow, University of Heidelberg, Germany
  • Prof Hans Ebbing, University of Bergen, Norway
  • Prof Trevor Evans, Berlin School of Economics and Law
  • Prof Marica Frangakis, Nicos Poulantzas Institute, Athens
  • Prof Alan Freeman, Metropolitan University, London
  • Prof Cees J. Hamelink, Vrije University Amsterdam
  • Prof Wolfgang Fritz Haug, Institute for Critical Theory
  • Prof Peter Herrmann, University of Cork
  • Prof Rudolf Hickel, University of Bremen
  • Dr Anne Karrass, scientific assistant in the German Parliament
  • Prof Pierre Khalfa, Scientific Council of Attac France
  • Prof Jeremy Leaman, Loughborough University, UK
  • Prof Ingrid Lohmann, University of Hamburg
  • Dr Kathleen Lynch, University College Dublin
  • Prof Birgit Mahnkopf, Berlin School of Economics and Law
  • Prof Mohssen Massarrat, University of Osnabrück
  • Prof John P. Neelsen, University of Tübingen
  • Dr Miguel Otero-Iglesias, University of Oxford
  • Prof Norman Paech, HWP Hamburg, em.
  • Christine Pagnoulle, University of Liege
  • Prof Mario Pianta, University of Urbino, Italy
  • Frederico Pinheiro, SOL, Portugal
  • Dr Ralf Ptak, University of Cologne
  • Prof Rainer Rilling, Philipps-University Marburg
  • Prof Roland Roth, Magdeburg-Stendal University of Applied Sciences
  • Carlos Ruiz, Co President of Attac Spain
  • Dr Thomas Sablowski, Justus-Liebig-University, Gießen
  • Prof Anwar Shaikh, New School for Social Research, New York
  • Prof Rune Skarstein, Norwegian University of Science and Technology, Trondheim
  • Roland Süß, Board of Attac Germany
  • Prof Gerd Steffens, University of Kassel
  • Steffen Stierle, Board of Attac Germany
  • Eric Toussaint, President of CADTM Belgium
  • Aurelié Trouvé, President of Attac France
  • Prof Isidor Wallimann, University of Applied Sciences and Arts Northwestern Switzerland
  • Prof Frieder Otto Wolf, Freie Universität Berlin
 
tags: Global Capitalism   
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