[DEBATE] : Callinicos: Bubble bursts for European elite
peter at aidc.org.za
Wed Apr 19 11:17:52 BST 2006
Bubble bursts for European business elite
Protesting against the CPE youth employment laws in Paris last month
(Pic: Jess Hurd/ reportdigital.co.uk)
The victory of students and workers in France against neo-liberal
labour laws is the latest in a series of setbacks for the ruling
classes across the continent, writes Alex Callinicos
It will soon be a year since the defeat of the European Union (EU)
constitution in the French referendum. That marked the beginning of a
series of defeats for the neo-liberal agenda in Europe that has sent
a paroxysm of rage through the global business establishment.
“Europe Stalls on Road to Economic Change,” intoned the New York
Times on Friday last week: “After this week’s extremely close
election in Italy, there is a strong sense in Europe that, because of
weak governments and divided publics, the continent’s big three
countries are unable to make the economic changes that most political
leaders agree are essential to restoring growth.
“At stake, in the view of many European experts, is the ability of
countries like the big three – Germany, France and Italy – to
adapt to a globalised world in which Europe’s high labour costs and
low population growth could portend long term decline, not just of
economic power but of political influence as well.”
The problem is real enough. Unlike Britain, the main continental
economies still have big manufacturing sectors. This means they are
especially vulnerable to competition from low cost producers, above
all in China.
The political, business, and media establishment across Europe is
therefore firmly committed to the so called Lisbon agenda adopted by
the EU in 2000. This is a package of free market “reforms” that
would slash welfare provision and the protections that workers won
during the 20th century.
The trouble is that there is an enormous gulf between the
establishment and the mass of the population. Before the Italian
elections an economist at Bank of America told the Financial Times:
“Italy needs a massive dose of pro-growth reforms, deregulation, and
liberalisation of products and labour markets, privatisation to
reduce the still large presence of the state and a big shake-up in
the public administration.
“The electorate prefers more social protection and social spending
than lower taxes and deep supply-side reforms.”
Italian big business had despaired of getting “reforms” under
Silvio Berlusconi’s erratic and corrupt premiership. It hoped that
Romano Prodi, who as Italy’s prime minister in 1996-8 carried out
the spending cuts required for the country to join the euro, would
provide a steadier hand. But his wafer-thin majority will leave his
new government dependent on the votes of the far left Rifondazione
Massive popular commitment to the welfare state is the rock against
which the neo-liberal agenda has broken elsewhere in Europe. Gerhard
Schröder’s centre left government in Germany started to implement
“reforms” that slashed unemployment benefits.
In last September’s federal elections millions of voters deserted
the two main parties, many to vote for the Linkspartei, a new radical
The mainstream parties were forced into a “grand coalition” under
the conservative Christian Democrat leader, Angela Merkel, that
business fears is too weak to make further inroads into the welfare
But it is in France that resistance to neo-liberalism has been most
intense. The rebellion against prime minister Dominique de
Villepin’s CPE law that would have made it easier to sack young
workers is the latest in a cycle of revolt that has lasted more than
It began with the public sector strikes of November and December
1995, which brought down president Jacques Chirac’s first premier.
Then came the massive teachers’ strikes of May and June 2003, and
the defeat of the EU constitution last year.
The defeat of the CPE left Financial Times columnist Martin Wolf
almost frothing with rage: “In France, remarkably, the population
seems to believe that everybody can – and should – be treated just
like a civil servant.
“They seek a miraculous combination of almost absolute job security
with rising prosperity. In a rapidly changing world, this is a form
of collective cognitive disorder.”
Edwy Plenel, former managing editor of the French left-liberal daily
Le Monde, raved that the victory of the no vote on the constitution
marked the rise of “a national revolution” – a reference to
France’s pro-Nazi Vichy regime.
This kind of abuse can’t mask the fact that, despite the fact that
mainstream political parties and the mass media are solidly behind
it, the establishment has completely failed to persuade the mass of
people of the necessity or desirability of neo-liberal “reform”.
“The anti-liberal clerisy [intelligentsia] has basically won the
intellectual argument in much of Europe,” whines Charles Grant of
the Centre for European Reform, a Blairite think-tank. “They’ve
fostered the view that liberal economics leads to a kind of
Dickensian vision of child labour and old women crying in the
The element of truth in this is that, since the late 1990s, the
movement against neo-liberal globalisation has emerged as a powerful
political force in continental Europe.
A systematic critique of neo-liberalism has been widely circulated by
the monthly Le Monde Diplomatique and by writers such as Pierre
Bourdieu, Noam Chomsky and Susan George.
Attac, founded in 1998 to oppose international financial speculation,
was an important force in the campaign against the EU constitution in
Its German branch has worked with the trade unions to oppose
Schröder’s “reforms” and the EU Bolkestein directive that
threatens the wages and conditions of service workers.
In Italy, the mass protests at the G8 summit in Genoa in July 2001
and the anti-war movement have made opponents of neo-liberal
globalisation an important force around Rifondazione Comunista.
But the problem for Europe’s ruling classes goes much deeper. The
mass of European workers remain committed to the project of
traditional social democracy to use the power of the state to protect
them from the worst excesses of capitalism.
The mainstream parties of the labour movement have now abandoned that
project and embraced neo-liberalism.
This opens up a space to their left. As the German elections showed,
many social democratic voters, deserted by their traditional parties,
are looking for a political alternative.
The challenge facing the radical and revolutionary left in Europe is
to prove that they can offer this alternative, as Respect is trying
to do here in Britain.
If they succeed, then the crisis of the European ruling classes will
prove to be even worse than they already think.
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Dr Peter Dwyer
129 Rochester Road,
Cape Town, 7705.
TEL: 021 447 5770
FAX: 021 447 5884
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