I look at the imposition of austerity across Europe by market ideologues and shudder at the fragmented response by the left. Where are those who already suffer from austerity to turn for alternatives? Alternatives that are credible and provide hope that encourages those who are entitled to vote to do so and set a bottom line that those who already suffer poverty do not suffer the neoliberal solution for them of poverty plus austerity. See yanisvaroufakis.eu/euro-crisis/ and www.levyinstitute.org/pubs/pn_11_03.pdf.
Weaknesses in the European Single Market/Single Currency system had been identified and analysed already when the Single Market was formed in 1992 and those member states who objected to centrally-generated reserves then are now still at a loss as to how to handle today’s crisis. The authors of the European Commission’s Green Paper on the crisis also appear to have had a bout of amnesia when producing their recent publication on stability bonds. In it they ignore the work done in 1993 by Stuart Holland as he points out in his response to the green paper: “The Green Paper opens with the claim that the concept of a European bond was first discussed in by Member States in the late 1990s. The concept of common issuance was first discussed by Member States in the late 1990s, by the Giovannini Group”.
It then refers to publication in September 2008 of a discussion paper issued by the European Primary Dealers Association (EPDA) called “A Common European Government Bond”.
To claim that there was no other discussion by Member States than of these two technical documents is not only wrong, but displaces the Commission’s own recommendation to issue common bonds – Union Bonds – in the Delors White Paper of December 1993 on Growth, Competitiveness and Employment. This then was discussed by the Essen European Council in the spring of 1994. Luxembourg and the Netherlands were in favour. Helmut Kohl, forcefully, and François Mitterrand, with reservations, were against.
But Mitterrand then changed his mind later in the year, when Michel Rocard had been briefed on the case for bonds by the economic committee of the French Socialist Party and called for a 50 billion ECU European Fund for Jobs, financed by bonds, at the autumn conference of the French Socialist Party. When questioned by the press on whether he supported this, Mitterrand replied: “I agree with him completely, and would even go so far as to say – and I have checked this with the Commission this morning – that his figure could be doubled. If 100 billion ECUs were made available to develop a European infrastructure, we could show that Europe can be a key factor in promoting growth, work and jobs.” (L’Heure de Verité, France 2, 25 October 1994)
Jacques Chirac then recommended action on the Delors proposals at his first European Council at Cannes in June 1995. Agence Europe reported him as submitting to the Council that Own Resources had been entirely absorbed by the CAP following exchange rate realignments and arguing for “expansion of the new financial instruments” (i.e. the Delors’ Union Bonds).
Bonds again were on the agenda of the June 1996 Florence European Council, when only John Major and Helmut Kohl were against a decision to issue them. Both Jacques Chirac and Romano Prodi had called for them not only to finance growth and jobs but also to underpin what at the time was the projected single currency.
All of this was before the “later 1990’s” to which the Commission Green Paper attributes the “first discussion by Member States” of the common issuance of bonds, while their discussion of the Delors proposal of Union Bonds at European Council and Ecofin level continued thereafter with high press and media coverage rather than in the at the time unnoticed Giovannini Group, or a discussion paper published by the European Primary Dealers Association.
Such as when Giulio Tremonti gained discussion of common bonds in Ecofin on the lines proposed by Delors when in the Berlusconi government from June 2001, although Germany still was opposed. As also in the call of Manuel Barroso and Tony Blair in Lisbon in February 2003 for bonds to finance a 10 year programme to create the 15 million jobs which was the employment growth target of the 1993 Delors White Paper. As well as the statement by Manuel Barroso on the relaunching of the Lisbon Agenda that:
“It’s about growth and about jobs. This is the most urgent issue facing Europe today. We must restore dynamic growth which can bring back full employment and provide a sound base for social justice and an opportunity for all”.
The above arguments were originated by the left and eventually had support from the centre right. It is to be noted that the recent call by the left in the European Parliament in its call for an Appeal for Justice and Democracy is picking up these ideas and running with them. It is doing this through the www.transform-network.net/en/links.html which has membership drawn from across the European left publications and think tanks.
At beginning of the 20th century we had founders such as Keir Hardy travelling the continent to meet with fellow socialists at international gatherings. Now we can type our publications in English and have them translated on the demand of the recipient in to their own language. But we see the Murdochs, the destroyers of pluralism, which was supposed to provide a theoretical foundation to liberal freedoms for all and not just those that fall at the feet of the press barons. We see military alliances driven by the ideas of the same elite. We even see the mafia operating internationally and basic food production in the hands of a dozen (mainly US) conglomerates.
Now more than ever we need to try to pull together on the left in an exchange of ideas such as those being promoted by the left in the European Parliament and the transform-network. If Keir Hardy could do it under steam power surely we can do it with computer power.