Lobbying is an integral part of democracy, but multiple scandals throughout Europe demonstrate that a select number of voices with more money and insider contacts can come to dominate political decision-making – usually for their own benefit.

In a report titled ‘Lobbying in Europe: Hidden Influence, Privileged Access’ released Apr. 15, Transparency International said that the lack of clear and enforceable rules and regulations is to blame and called for urgent lobbying reform.

The report from the global civil society coalition against corruption found that of 19 European countries assessed, only seven have some form of dedicated lobbying law or regulation, allowing for nearly unfettered influence of business interests on the daily lives of Europeans.

“In the past five years, Europe’s leaders have made difficult economic decisions that have had big consequences for citizens,” said Elena Panfilova, Vice-Chair of Transparency International. “Those citizens need to know that decision-makers were acting in the public interest, not the interest of a few select players.”

Using international standards and emerging best practice, the report examines lobbying practices as well as whether safeguards are in place to ensure transparent and ethical lobbying in Europe and three core European Union institutions – European Commission, European Parliament and Council of the European Union.

Slovenia comes out at the top with a score of 55 percent, owing to the dedicated lobbying regulation in place, which nevertheless suffers from gaps and loopholes. Cyprus and Hungary rank at the bottom with 14 percent, performing poorly in almost every area assessed, especially when it comes to access to information.

Eurozone crisis countries Italy, Portugal and Spain are among the five worst-performing countries, where lobbying practices and close relations between the public and financial sectors are deemed risky.

Noting that the three E.U. institutions on average achieve a score of 36 percent, Transparency International said that “this is particularly worrying, given that Brussels is a hub of lobbying in Europe and decisions made in the Belgian capital affect the entire region and beyond.”

According to the report, none of the European countries or E.U. institutions assessed “adequately control the revolving door between public and private sectors, and members of parliament are mostly exempt from pre- and post-employment restrictions and ‘cooling-off periods’, despite being primary targets of lobbying activities.”

“Unchecked lobbying has resulted in far-reaching consequences for the economy, the environment, human rights and public safety,” said Anne Koch, Transparency International’s Director for Europe and Central Asia. The research highlights problematic lobbying practices across a wide range of sectors and industries in Europe, including alcohol, tobacco, automobiles, energy, finance and pharmaceuticals.

“Unfair and opaque lobbying practices are one of the key corruption risks currently facing Europe,” said Panfilova. “European countries and E.U. institutions must adopt robust lobbying regulations that cover the broad range of lobbyists who influence – directly or indirectly – any political decisions, policies or legislation. Otherwise, the lack of lobby control threatens to undermine democracy across the region.”

Edited by Phil Harris    

By Roberto Savio
ROME, Mar 12 2015 (IPS)

The world is clearly splitting into two parallel worlds, with each going their own way, in what we could call the ‘Acapulco paradox’.

Take the official version of the image of Acapulco – a splendid Mexican resort, with horse riding on the beaches, a place blessed by nature and enriched by beautiful villas, gourmet restaurants, a place of bliss and relaxation.

Roberto Savio

Now take the version of the people living there – a place torn by criminal gangs with several deaths every day, where locals live in fear and total insecurity.

In the same way, there are now two ways to look at global reality.

One is the macroeconomic approach based on global data and, according to which, Greece has been doing better along with Italy, Portugal and Spain. In those countries, macroeconomic data are improving. Spain is even being touted as the example of how a country, which went through the bitter pill of austerity, now has growth at the same level as Germany.

Then, speak with young people, among whom unemployment is close to 40 percent, or with pensioners, or with those working in the hospital and education sectors, and you get a totally different picture. According to Caritas, the number of people living in misery has doubled in the last seven years.

The alternative model is the United States, which invested in growth and not in austerity like Europe. Its growth is running at 2.4 percent against an anaemic 0.1 percent for Europe. Again, the positive macro data do not coincide with the people’s data.

“Take the official version of the image of Acapulco, a place of bliss and relaxation. Now take the version of the people living there, a place torn by criminal gangs, where locals live in fear and total insecurity. In the same way, there are now two ways to look at global reality”
Let us take the latest example of economic recovery: the decision of the Walmart retail chain, one of the largest employers in the United States to increase the hourly wage from 8.9 to 10 dollars. This looks like very positive news, but the fact is that 60 percent of Walmart staff do not work sufficient hours to make a living – some work just two days a week, and with 640 dollars a month you are still into poverty.

Maybe it is just a coincidence, but the suicide rate rose from 11 per 100,000 people in 2005 to 13 seven years later. In the time it takes to read this article, six Americans will have tried to kill themselves and in another ten minutes one will have succeeded. More than 40,000 Americans took their own lives in 2012, more than died in car crashes, says the American Association of Suicidology.

If you start looking into the macro data, things become clearer. Profits from the financial sector are now over 20 percent of the total, double the level from the Second World War to the 1970s, and since 1970 productivity has grown by less than half. What this means is that the real economy has grown by half that of finance.

It is now clear that it is growth of the finance industry which is really holding back the rest of the economy, and far fewer people are employed in the financial sectors than in production and services.

These data come from nothing less than the Bank of International Settlements, the Gotha of the banking world, which also reports that brilliant people are trying to move into the financial sector, to the detriment of other sectors of the economy.

Looking into the figures opens up fascinating analyses. One of them from Hong Kong, published in the New York Times in the first week of March, deals with the personal wealth of lawmakers from China and the United States.

The NYT reported that according to the Shanghai-based Hurun Report, of the 1,271 richest people in China – a record 203 – nearly 16 percent are in the Parliament or its advisory body. Their combined net worth is 463.8 billion dollars, which is more than the annual economic output of Austria.

By comparison, American lawmakers are poorer. Eighteen of the Chinese lawmakers have a net worth greater than the 535 members of the U.S. Congress, the nine members of the U.S. Supreme Court and U.S. President Barack Obama’s cabinet.

We should pity the U.S. lawmakers, the 22 richest members of whom have only an average of 124 million dollars (70 percent of the senators are millionaires anyhow) and make up only four percent of the Senate, while four percent of the richest Chinese lawmakers are the country’s 203 billionaires.

Statistics in Europe also open the way to illuminating reflections. Take Spain, for example, where billionaires are in decline. In the Forbes list of the richest men in the world, Spain now has 21, five less than last year. Their combined wealth is 116,300 million dollars, and they increased their wealth in a year by only 500 million dollars, against the 3,200 million dollars of the richest man in the world, Bill Gates.

Yet, 500 million dollars is the equivalent of 35,714 average yearly  salaries, close to the population of the sunny town of Teruel in eastern Spain (around 36,000), and 116,300 million dollars is the equivalent of 8.3 million yearly salaries, equal to the combined population of Andalusia, the largest Spanish region, and the Balearic Islands.

The problem is that those two worlds are supposed to meet and relate through political institutions: Parliament, which represents everybody, and Government, which is supposed to regulate society for the good of every citizen.

Well, a good case study comes again from Spain, where it is possible to become a Spanish resident without going to Spain. It is sufficient to buy two millions euros’ worth of the country’s public debt, or buy one million euros’ worth of shares, or buy a house that costs at least 500,000 euros plus taxes, to become a Spanish resident. Since September 2013, 530 foreigners have obtained that right.

It is probable that the experience of obtaining a Spanish residence permit of the tens of thousands who crossed the Mediterranean at risk of their lives (it is estimated that over 20,000 have died up to now) looks very different. And many European countries have taken a similar path, including the United Kingdom, Cyprus and Portugal

In the United Kingdom, there is now a debate on a law from 1914 which excludes “non-domiciled” residents (‘non-doms’) from paying taxes on their foreign income or assets. It is enough to have a domicile abroad, usually by declaring permanent home in a tax haven. The number of ‘non-doms’ surged by 22 percent between 2000 and 2008 (year of the last available date), to reach 130,000 people.

This is part of an effort to reduce taxation on rich people, by creating loopholes and new regulations, to attract as many rich people as possible. President François Hollande in France has learnt at his expense what it means to speak of taxing the rich and had to make a quick turnaround. Obama is doing the same, and the only ‘leader’ who is speaking about taxing the rich is now Pope Francis.

However, one of the best examples of the ‘Acapulco paradox’ comes from the City in London.

After all the popular uprising about the disproportionate salaries of bankers, with public declarations from the U.K. government, the Church of England and the Bank of England, the announcement of an improvement in the U.K. economy by the European authorities has been taken at face value.

Barclays, for example, is increasing salaries by 40 percent, and an increase in salaries of 25 percent is expected all over the City this year. A young financial analyst, just out of university, at entrance salary could expect to take home the equivalent of 100,000 dollars per year.

While this will be good for statistics on average incomes, the yearly incomes of the 10 percent poorest British citizens will keep them at survival level. It is likely that their view of economic recovery will be different from those in the City. (END/IPS COLUMNIST SERVICE)

Edited by Phil Harris    

The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, IPS – Inter Press Service. 

Excerpt:

By Roberto Savio
ROME, Oct 22 2014 (IPS)

The new European Commission looks more like an experiment in balancing opposite forces than an institution that is run by some kind of governance. It will probably end up being paralysed by internal conflicts, which is the last thing it needs.

During the Commission presided over by José Manuel Barroso (2004-2014), Europe has become more and more marginal in the international arena, bogged down by the internal division between the North and the South of Europe.

Roberto Savio

We are going back to a new Thirty Years’ War – which took place nearly five centuries ago – between Catholics and Protestants. Catholics are considered profligate spenders, and there is a moral approach to economics from the Protestant side.

The Germans, for example, have transformed debt into a financial “sin”.  The large majority of Germans support the stern position of their government that fiscal sacrifice is the only way to salvation, and the looming economic slowdown will only strengthen that feeling. As a result, the handling of Europe’s internal governance crisis has largely pushed Europe to the side lines of the world.

It is a mystery why it is in the interests of Europe to push Russia into a structural alliance with China and, in such a fragile moment, inflict on itself losses of trade and investment with Russia which could reach 40 billion euro next year.“We are going back to a new Thirty Years’ War – which took place nearly five centuries ago – between Catholics and Protestants. Catholics are considered profligate spenders, and there is a moral approach to economics from the Protestant side.”

The latest issue of the prestigious Foreign Affairs magazine – the bible of the U.S. elite – carries a long and detailed article on “Why the Ukraine Crisis is the West’s Fault” by Chicago academic John J. Mearsheimer, who documents how the offer to Ukraine to join the North Atlantic Treaty Organisation (NATO) was the last of a number of hostile steps that pushed Russian President Vladimir Putin to stop a clear process of encroachment.

Mearsheimer wonders how all this was in the long term interests of the United States, beyond some small circles, and why Europe followed. But politics now has only a short-term horizon, and priorities are becoming conditioned by that approach.

A good example is how European states (with the exception of the Nordic states), have been slashing their international cooperation budgets. Not only have Spain, Italy and Portugal – and of course Greece – practically eliminated their official development assistance (ODA) budgets, but France, Belgium and Austria have also been following suit. Meanwhile China has been investing heavily in Africa, Latin America and, of course, Asia where the term ‘cooperation’ would not be the most appropriate.

But the best example of Europe’s inability to be in sync with reality is the last cut in the Erasmus programme, which sends tens of thousands of students every year to another European country. Has it been overlooked that one million babies have been born to couples who met during their Erasmus scholarships, and that this programme is being cut at a moment when anti-Europe parties are sprouting everywhere?

In fact, education – and especially culture (and medical assistance) – are under a continuous reduction in spending. As Giulio Tremonti, Finance Minister under Italian Prime Minister Silvio Berlusconi, famously said, “you don’t eat with culture”.

The per capita budget for culture in southern Europe is now one-seventh that of northern Europe. Italy, which according to UNESCO holds 50 percent of Europe’s cultural heritage, has just decided in its latest budget to open up 100 jobs in the archaeological field with a gross monthly salary of 430 euro. In today’s market, this is half what a maid receives for 20 hours of work a week.

Italian politicians do not say so explicitly, but they believe that there is already such rich heritage that there is no need for further investment and, anyhow, the tourists continue to arrive. The budget for all Italian museums is close to the budget of the New York Metropolitan Museum … in the real world, this is like somebody who wants to live by showing the mummified body of his great grandmother for the price of a ticket!

It can be said that, in a moment of crisis, the budget for culture can be frozen because there are more urgent needs. But no need is more urgent than to keep Europe running in the international competition in order to ensure a future for its citizens. And yet, the budget for research and development, which is essential for staying in the race, is also being cut year by year.

Let us look at the situation since 2009. Spain has reduced investment in R&D by 40 percent, which has led to a 40 percent cut in financing for projects and a 30 percent cut in human resources. Italian universities have witnessed a total cut of 20 percent in spending which has meant a reduction of 80 percent in hiring and 100% in projects, while 40 percent of PhD courses have disappeared.

France has cut hiring in centres of research by 25 percent and in universities by 20 percent. Less than 10 percent of demand for projects receives financing because funds are no longer available.

Greece has cut budget for centres of research and universities by 50 percent since 2011, and has frozen the hiring of any new researchers.

In the same period in Portugal, universities and research centres have suffered a cut of 50 percent, the number of scholarships for PhDs has been cut by 40 percent and post-doctoral courses by 65 percent.

It is important to recall that the Lisbon Strategy, the action programme for jobs and growth adopted in 2000,  aimed to  make the European Union “the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion” by 2010. Not only were most of its objectives not achieved in 2010, but Europe continues to slide backwards. The Lisbon Strategy had set 3 percent of GNP for R&D, but southern Europe is now below 1.5 percent.

A notable exception is the United Kingdom. The current government, which works in strong synchronicity with the City and its industrial constituency, has funded a 6 billion euro “Innovation and Research Strategy for Growth” plan to the applause of the private sector.

China is steadily increasing steadily its R&D budget, which is now 3 percent (what the Lisbon Strategy had set for Europe), but it aims to reach 6 percent of GNP by 2020 and, in just seven years, China has become the largest producer of solar energy, bankrupting several U.S. and European companies.

Is cutting Europe’s future in international competition really in the interests of Germany? Or it is that politics are losing the view of the forest while they discuss how many trees to cut, to reach a compromise between the Catholics and the Protestants?

We are now making of economics a moral science, which makes of Europe an unusual world. (END/IPS COLUMNIST SERVICE)

(Edited by Phil Harris)

Excerpt:

Pensioners protesting in the Praça do Município in Lisbon. Credit: Katalin Muharay/IPS

By Mario Queiroz
LISBON, Aug 16 2013 (IPS)

The elderly have taken to the streets in Portugal to protest drastic public sector pension cuts announced this week by the government of conservative Prime Minister Pedro Passos Coelho.

Never before had so much grey hair been seen in the frequent anti-government demonstrations. Shoulder to shoulder with employed and jobless workers and often leaning on the arms of their grandchildren, senior citizens have come out on to the streets in defence of their fragile rights.

Temporary workers, civil servants and pensioners have been hit hardest by the harsh austerity measures imposed by the International Monetary Fund, the European Union and the European Central Bank in exchange for a 110-billion-dollar bailout package in mid-2011.

Since then, the so-called “troika” has dictated the public finance policy of this crisis-stricken country of 10.6 million people.

The cuts announced by the government for this year and next in the state administration amount to 4.92 billion dollars – half the sum spent to bail out three private banks, the opposition and trade unions complain.

The additional cuts in pensions are even worse than “all the damage already done to pensioners,” said Jorge Nobre dos Santos, head of the Frente Sindical da Administração Pública (FESAP), a public employees’ union.

“The money has been and still is being managed by all sorts of agents, governments and politicians, without even asking the permission of its legitimate owners,” those who paid in to the Portuguese Social Security (SSP) system all their lives, dos Santos complained.

He pointed out that the measure is retroactive, violating the state’s commitments to its retired workers. The strategy is to engulf all pensions, “whether public or private,” he said.

“The state’s credibility is at stake; it is being undermined by the prime minister,” he maintained.

Teles Alcides, a representative of the Frente Comum dos Sindicatos da Administração Pública (FC), another public sector union, described the proposed cuts as “robbery.”

The FC has pledged to do everything possible to block the new measure. “The attempt to reduce pensions plunders those who have contributed to the system and have pension rights,” said Alcides.

The only alternative for hundreds of thousands of people in Portugal “is to express outrage over these measures, that are unprecedented in their harshness – a veritable robbery of what has been discounted from our pay throughout our working lives; this is money that is not the state’s, but our own,” said retiree Armindo Brandão, who faces a 9.5 percent cut in his SSP pension.

“For me, with my pension of 1,020 dollars, this is an enormous reduction, as well as being sheer robbery, but as the robbery is committed by the government, the thief is not arrested,” Brandão said.

The pensioners’ protests have turned violent, with almost daily verbal and even physical attacks on SSP or General Tax Directorate officials.

According to an association of pensioners and retirees, ARE, the protests are an uprising against the public authorities triggered by the continued attacks on this vulnerable sector of the population “which sees its retirement income dwindling daily due to new taxes and cuts.”

The situation “amounts to a confiscation of the assets of those who paid contributions all their lives and who now see their pensions cut in an unprecedented act of plunder,” says an Aug. 13 ARE communiqué.

The feeling among those most affected by the crisis is one of profound injustice, as shown by a letter sent to the Lisbon newspaper Público by a reader, Manuel Morato Gomes.

While cuts are being made even in widows’ pensions, no explanations are being given for “the exceptions for former judges and diplomats, or for the life pensions granted to former members of parliament, government ministers and presidents,” Morato Gomes complained.

Where, he asked, are the justice, morality, equity and common sense in this measure? He accused Passos Coelho of “acting only in accordance with his liberal theories, completely disregarding people’s needs.”

IPS consulted another retiree, Feliciano, a former soldier who fought in the colonial wars in Portugal’s former colonies in Africa (1961-1974), where he lost a leg. He receives a modest disability pension.

He asked to only be identified by his first name “for fear of reprisals.” “They might take away the little money that I get,” he said, lamenting “the lack of sensitivity and respect for those of us who went to Africa to fight for our flag in an unjust war that we did not even believe in.”

“I survived the war in Guinea Bissau, although I was severely injured, but I do not think I will survive this government. It only wants to get rid of the old people; let them die as soon as possible, so the state can balance its books,” he said.

Portuguese President Aníbal Cavaco e Silva has taken the precaution of asking the Constitutional Court to rule on the legality of the government’s proposed budget cuts bill, which includes lay-offs in the civil service.

An editorial in Público says that the conservative Cavaco e Silva does not remotely suppose that the law is unconstitutional. But “its provisions are so drastic, its coverage so wide and its potential consequences for the lives of thousands of citizens so devastating that no president would risk signing it into law without the Constitutional Court’s approval.”

The editorial concludes with the prediction that, if the Court vetoes the bill, “radical supporters of the austerity measures will say again that the constitution has become a blockading force that is dragging the country into the abyss. They may say so, as long as they do not then claim that the rule of law can coexist with violations of the constitution.”

Gay activists march on Apr. 25, the anniversary of the Carnation Revolution in Portugal. Credit: Anette Dujisin/IPS

By Mario Queiroz
LISBON, May 31 2013 (IPS)

The heated reaction to the legalisation of same-sex marriage has run counter to the widespread image of France as the cradle of the modern republic and equal rights since the 1789 revolution. In contrast, Portugal with its reputation for prudishness, has shown itself to be much more open and tolerant.

The violent backlash of wide sectors of French society against the Apr. 23 parliamentary approval of the bill allowing same-sex marriage, signed into law May 18, perplexed many observers accustomed to regarding this country as a haven of tolerance.
Clashes between police and protesters, many of them members of traditionalist Catholic organisations who view gay unions as an affront to the sanctity of the family, continued late into the night of Sunday May 26.

However, tempers cooled, and on Wednesday May 29 the first French marriage between two men took place without incident in the southern city of Montpellier, with 500 people celebrating, 140 journalists in attendance, and only five far-right protesters who were easily controlled by around 100 police officers.

Prominent figures who oppose gay marriage include Archbishop of Paris Cardinal André Vingt-Trois, and the bishop of Bayonne, Lescar and Oloron, Marc Aillet.

In contrast, in Portugal, also a Catholic country, when the law on same-sex marriage was approved in 2010, the then Patriarch of Lisbon, Cardinal José da Cruz Policarpo, maintained a respectful silence because of the separation of church and state.

And Portugal went one step further. Following a proposal by the left, supported by several rightwing members of parliament, the Portuguese legislature on May 17 approved a bill allowing “co-adoption” by a same-sex couple of the children (biological or adopted) of one of the partners.

Rui Tavares, Portuguese Member of the European Parliament for the Greens, told IPS the apparent contradiction was because “France is a conservative country, but most foreigners do not believe this because they are only familiar with historic moments like the 1789 revolution, the Liberation (resistance against German occupation 1940-1945) and (the student movement of) May 1968.”

But Tavares said those events “were exceptions to the rule,” and that since 1945, “France has only twice elected leftwing presidents, François Mitterrand (1981-1995) and François Hollande (the incumbent).

“The rest have all been conservatives: Charles de Gaulle, Georges Pompidou, Valéry Giscard d’Estaing, Jacques Chirac, and Nicolas Sarkozy.” Extreme rightwing leader Jean-Marie “Le Pen even got to the second round of voting in the 2002 presidential elections,” he said.

“What a fine example France is, as the first European republic, but paradoxically retaining many aristocratic and monarchical features, a country with structures that are more authoritarian and hierarchical than those of Portugal,” Tavares said.

“Large pockets of reactionary and retrograde Catholicism remain, that hid under cover during the Liberation, reappeared with the Algerian War and are very well organised,” he said.

In Portugal, in contrast, “there is no extreme right, nor organised Salazarist supporters,” he said, referring to António de Oliveira Salazar (1889-1970), the founder and leader of the dictatorship established in 1933 and overthrown in 1974 by the Carnation Revolution, led by leftwing army captains.

“This country has been liberalised, urbanised and modernised a great deal in the last 30 years, and the majority of the population identify with those changes that have improved their lives, and are now much more open and plural,” he said.

In spite of this, “homophobia continues to exist in Portugal, as reflected in language and attitudes, although it is more broad than deep, and many people opt for an attitude of non-interference in other people’s lives, even in aspects that might be regarded as objectionable.

“In general, Portuguese people do not tend to have absolutist views about anything,” Tavares said.

In Portugal, “family ties are strong, and have even become an argument in favour of gay marriage,” he said, describing a personal experience: “My mother, who is 80 years old, telephoned me to say that from now on she is in favour of same-sex marriage, because she heard a gay man say how much his mother would like him to get married.”

In France, “distances are greater, even between close relatives, so opposition to same-sex unions appears to be a rational or values-based issue, and is not undermined so much by experiences of family affection,” the Member of the European Parliament concluded.

For his part, Fernando Fernández, a writer and retired journalist for Agence France-Presse (AFP), said “what is striking about the protests in the country against the law legalising same-sex marriages is that they are an apparent contradiction in a society that has a world reputation for being tolerant, open and liberal.

“It’s true that French society can appear liberal from the perspective of countries that are deeply marked by the Catholic Church, like Spain or Poland,” Fernández told IPS in a telephone interview.

“But in addition to the religious influence, French society is no doubt much more determined by what it regards as its values, and will not accept homosexuals having the same rights and responsibilities” as heterosexuals, he concluded.

Emilia, a 29-year-old Portuguese lesbian, spoke to IPS on condition that her surname be withheld, “because I am one of the lucky few to have a job, in a country where there are many homophobic bosses and unemployment among young people is nearly 50 percent.

“Of course there are fundamental differences between Portugal and France, where a strong police presence is needed at a marriage of a same-sex couple, showing the level of stupidity and primitivism among some French people,” she said.

However, she said the situation in Portugal should not be idealised.

“It’s true that our laws on gay marriage and adoption are among the most advanced in the world, but it’s also true that life is not easy for us, especially when it comes to equal opportunities. We are rejected by people with very conservative morals who hold high office in companies and institutions,” she said.

Greeks protesting against austerity measures. Credit: Apostolis Fotiadis/IPS

By Mario Soares
LISBON, May 27 2013 (IPS)

The economic crisis began in the United States under the administration of then-President George W. Bush, following the collapse of the Lehman Brothers Bank. It came as a result of unregulated globalisation and a neoliberal ideology that places usurious markets, offshore bank accounts, and money for the sake of money, above state power. It is an ideology that ignores citizens, even as they starve.

At the time – between 2007 and 2009 – I wrote some books: “A Changing World”, “In Praise of Politics”, “Fighting for a Better World” and “Inside the Hurricane”, addressing in all of them my concerns about the risk of a neoliberal contagion of the euro and the European Union (EU) itself.

Mário Soares, former president and prime minister of Portugal. Credit: IPS

U.S. President Ronald Reagan and British Prime Minister Margaret Thatcher championed these disastrous neoliberal politics – which were later continued by the pseudo-labourite Tony Blair – whose negative consequences are now evident to all.

In view of the profound links between Europe and the United States, the spread of U.S. neoliberalism to the EU and particularly to the eurozone was inevitable. When the EU crisis began, chancellor Angela Merkel already headed Germany. In spite of being a Lutheran, Merkel was also a former militant of the East German Communist Party. After the fall of the Berlin Wall she stood in opposition to the German reunification to which European states contributed.

As is well known, the first victim of the crisis was Greece, the cradle of our civilization and thus a country that deserved better treatment. It got the opposite.

The German chancellor, a longtime ally of ultra-conservative liberals, heeded market demands. The situation in Greece, where German banks occupied a privileged position, deteriorated until the country was able to pay the exorbitant sum demanded by the Troika, a body comprised of Greece’s major creditors: the European Central Bank (ECB), the International Monetary Fund (IMF) and the European Commission (EC).

In the meantime, in the absence of financial assistance, the so-called peripheral states of the eurozone plunged into crisis. Ireland, Portugal, Spain, Italy (Europe’s third largest economy) and Cyprus were followed by the recent and surprising Dutch collapse. France is the latest addition to the list.

It all boils down to the criminal policy of austerity imposed by Germany, the IMF, the European Commission under the presidency of Jose Manuel Durão Barroso and, with greater discretion, Mario Draghi’s European Central Bank.

It has become more than evident that austerity favours merely usurious markets and those behind them. Austerity obliterates states and their respective populations, not only in the so-called “peripheral”, southern states, as was recklessly claimed. Take a look at the Netherlands, France and Germany. The crisis was bound to hit Germany as many economists, including Nobel Prize-winners Joseph Stiglitz and Paul Krugman, had predicted.

Currently Germany is struggling due to a policy of austerity that has shrunk many of its markets in the European states, which account for 50 percent of its exports. If austerity is maintained, Germany itself will enter a recession.

European public opinion has understood both the necessity and urgency of a break not only with current policy, but also with a political class that has proven incompetent.

The current ruling parties within the EU are mostly ultra-conservative and incapable of grasping the critical situation. Truth be told, the parties that built the EU – the socialists, the social democrats, the Labourites, and the Christian democrats, are no longer in power.

The sole exceptions are France and now Italy, where President Giorgio Napolitano was re-elected in spite of his age, and where we find a new prime minister in the figure of Enrico Letta. Both Letta and French President Francois Hollande have openly declared their opposition to austerity and their intention to restore the role of states in controlling markets, and not the other way around.

Hence, the citizens of all European countries have vociferously expressed their opposition to Troikas, the markets, pseudo-politicians and those governments committed to austerity.

It should be noted that the welfare state (a product of the postwar era), democracy as we conceived it, as well as the rule of law are all being jeopardised, creating the need for a profound and immediate political shift.

We face a straightforward dilemma: either we fight against unemployment, widespread poverty, recession and in defense of the welfare state in its broader sense, or, if we wait too long, the EU will fall into the abyss.

And not only would it be tragic for the U.S. to lose its only faithful ally, but many nations of the world would suffer: China, Russia, Japan, Brazil, India, Mexico and so on.

I am hopeful this won’t be the case. The world surely does not wish the disappearance of the European Union, the most original political project of all times and the one that brought so many benefits to its peoples. Its collapse could open the door to a global conflict. Its demise would represent an unacceptable regression of civilization, one that would set us more than a century back. May common sense and courage prevail.

(END/COPYRIGHT IPS)

Excerpt:

The huge impact of the economic crisis on male employment in Portugal has led to a sharp increase in the proportion of women who have become the main breadwinners in their families. But that has not translated into progress towards equality.

“Today there is more male unemployment than female, because the crisis has especially affected the civil construction industry,” said Anália Torres, a professor at the Technical University of Lisbon’s Higher Institute of Social and Political Sciences.

“With less economic activity in that industry, which traditionally employs men, the male unemployment rate has climbed, while in sectors that generally employ women, unemployment grew much less,” Torres said in an interview with IPS.

The European Commission expects unemployment in Portugal to reach 17.3 percent in 2013. But opposition parties and trade unions project a rate of 24 percent.

Professor Anália Torres at the Technical University of Lisbon’s Higher Institute of Social and Political Sciences. Credit: Mario Queiroz/IPS

The gap between the figures is explained by the thousands of people who have stopped registering at the government employment centres or have moved abroad, mainly to other European countries or to the former Portuguese colonies of Brazil, Angola, Mozambique or Macau.

Among those who only have a primary school education, “the woman always earns less than the man,” Torres said. “And as the educational level increases, the difference between the incomes of men and women grows. A woman with a doctorate earns much less than a man (with the same degree).”

In areas like education and health, where women earn 20 percent less than men, it is men who are most often laid off “because they are more expensive.”

Another factor that puts women in the position of bringing home the bacon “is that many remunerated activities carried out by women are in the informal economy, undeclared or unskilled work, such as cleaning or babysitting in the homes of the well-off,” the academic said.

In Portugal, the 1961-1974 colonial war in the country’s overseas territories in Africa – Angola, Guinea-Bissau and Mozambique – “led to large numbers of women replacing men (in the workplace),” Torres said.

Since then, “the idea of the working woman who helps support her family has remained in place,” she added.

During the war, Portugal maintained a permanent force of 220,000 military troops – an enormous figure compared to a population at the time of 8.8 million (10.6 million today).

In the 1960s, one million people from Portugal moved abroad for economic reasons or to avoid being sent to war in Africa. Women, Torres said, “took on a central role in a country with very few men of working age.”

Nevertheless, “the predominant sexism persisted, and men continue to make a show of unacceptable machismo today,” she said.

“By refusing to help do things around the home on the argument that ‘I am a man, I don’t do that kind of work’, which also causes serious domestic violence problems, men show that the sexist culture is still in place.”

Women are sometimes the target of violence, often with tragic results, because many men “base their masculinity on their wage-earning power, even though both men and women have been working and supporting the family for a long time now in Portugal,” Torres added.

Between January and November 2012, 30 women were killed in Portugal by their partners or ex-partners, according to UMAR, one of the largest women’s organisations in the country.

That makes Portugal the country with the largest number of femicides – gender-related murders – in the European Union, in proportion to the population.

But “working is also a kind of insurance against machismo, in the sense of women being aware that they are making a living and don’t need men,” Torres said.

Sociologist and researcher Sofia Aboim of the University of Lisbon’s Institute of Social Sciences said that in the last eight years, the proportion of couples in which the woman is the main breadwinner has risen from two to 16.5 percent.

It is “obvious” that many men “have suffered a strong blow to their self-esteem, because their masculinity is traditionally associated closely with supporting the family,” she wrote in the newspaper Público about the conclusions of a study on the subject.

Aboim said this situation was seen especially in couples with low levels of education and in older couples, especially between the ages of 51 and 65.

But Torres said discrimination against women is also deeply rooted among more educated segments of the population, even though “there are many women with excellent educations – teachers and professors, for instance.”

In general, “the highest-level posts are filled by men, even though, for example in the academic world, studies show that there is no difference in the production of research or articles. But women are not heads of institutes and are not on the boards of universities, with very few exceptions,” she said.

One big exception is the Centre for Judicial Studies, which provides training for future judges and prosecutors. Because the centre accepts lawyers on the basis of competitive examinations, “80 percent of those who have been accepted for training as magistrates in the last decade were women, because they scored higher than men.”

The problems plaguing Portugal affect everyone, “but in the crisis, women face greater difficulties, aggravated in cases in which their husbands are unemployed, because they still have to take everything on their shoulders.

“The worst thing about this government (of conservative Prime Minister Pedro Passos Coelho) is its complete insensitivity and indifference towards the plight of the people,” Torres said.

This is especially serious in Portugal and other countries where sexism is predominant, she said, because “if a woman has work and her partner does not, she continues to do the housework, unlike what occurs in other places, where men participate in the housework when they are unemployed.”

By Mario Queiroz
LISBON, Feb 19 2013 (IPS)

Thousands of people marched through the streets of cities across Portugal “against exploitation and impoverishment” caused by the government’s austerity cuts, in a protest organised by the General Confederation of Portuguese Workers (CGTP), the country’s largest trade union.

Arménio Carlos: “Hunger is back in Portugal”. Credit: Mario Quiroz/IPS

“The European Union should not be an accomplice to neoliberal economic policies that treat people as objects and attack basic social benefits, to the point of negating the United Nations Universal Declaration of Human Rights,” CGTP Secretary-General Arménio Carlos told IPS, while finalising details for the Jornada Nacional de Acçao e Luta (National Day of Action and Struggle) held Saturday.

The CGTP announced on Friday Feb. 15 that it would present a complaint against the Portuguese state before the International Labour Organisations (ILO) for violation of several conventions for the protection of collective bargaining and freedom of association.

Excerpts from the interview with Carlos follow.

Q: Are we seeing a substantive change in the system that used to guarantee what is known as “Social Europe”?

A: What is being called into question is a set of assumptions and principles upholding decent work, as defined by the ILO. One cannot play with people’s lives; they are not “guinea pigs” for neoliberal laboratories to test how far one can go, whether in Portugal, Greece, Spain or Ireland.

Our countries were viewed as of lesser importance, because of their economic and financial problems, but now it is becoming evident that the problems do not only apply to Portuguese, Greek or Irish people. They also affect Germany, the “engine” of Europe, which has entered a phase of economic stagnation. This ought to give those responsible for the EU pause for reflection.

Q: How will Portugal be able to pay its debt of 78 billion euros (equivalent to 110 billion dollars) owed to the EU-International Monetary Fund (IMF)-European Central Bank (ECB) troika?

A: Unless the loan is renegotiated, Portugal will not be able to pay and will become a financial colony.

Renegotiation does not mean evading repayment, it means negotiating suitable conditions in order to do so. But the lenders themselves are hampering the development of economic policies to allow repayment of the debt.

For example, the ECB is helping the financial sector by lending money at 0.7 percent interest and, in turn, banks are making credit available at eight percent to the state and to companies. This means the ECB is presently fomenting financial speculation.

Unemployment is still growing in Portugal and we have almost one million people without work, equivalent to a record figure of 16.9 percent, the third highest jobless rate in the EU, after Greece and Spain. The economic recession is going to continue this year. Tens of thousands of companies are going to close down or go bankrupt.

Q: Does this disheartening future mean that poverty will also increase?

A: Poverty and social exclusion are becoming generalised throughout Portugal, and we are also seeing the return of hunger in this country.

Thousands of children are hungry, and naturally that also means that their parents have also been hungry for some time, due to the neoliberal policy that is bleeding Portuguese people dry.

In addition to the widespread suffering it has caused, the country’s future is being called into question. It is a policy that does not solve problems, but exacerbates them.

Q: The two general strikes and various protest demonstrations in 2012 achieved enormous turnouts. Is that because the demands of the CGTP now go far beyond strictly trade union matters?

A: Reduction of purchasing power is affecting millions of people, and it can be seen at two levels.

First, because of inflation without adjustments in wages, on average over the last two years private sector workers have lost more than 10 percent of their purchasing power, while public sector workers have lost 25 percent or even 30 percent in some cases.

Second, the general state budget for 2013 will impose further income reductions through taxes, which will cause a fall of between six and seven percent in family incomes, so that one can only conclude that the purchasing power of workers will continue in free fall.

Meanwhile, enormous tax benefits are being granted to large economic and financial corporations, without any real effort to combat fraud and tax evasion. It is interesting to know, too, that these crimes cost about 25 percent of GDP.

That is where the problem should begin to be attacked, but it does not happen, because those economic and financial powers are practically untouchable.

The two general strikes and the big demonstrations in 2012, as well as Saturday’s protest, represent a snowballing movement, an unprecedented moment in which the vast majority of Portuguese people can express their discontent and indignation and demand an end to the policies imposed by the troika.

Q: What about labour rights?

A: The balance of labour laws between workers and employers has been further tipped in favour of the bosses, for instance, by reduction in overtime pay, easier dismissal, lower compensation payments and erosion of social protection, as well as an unprecedented attack on collective bargaining.

We are seeing deregulation of labour laws in favour of employers.

At present, miserable levels of compensation are being debated, that would put a Portuguese worker at the level of only 12 percent of an Irish or German worker and between 25 and 30 percent compared to a Spaniard. In addition to the recessionary spiral, in Portugal we have a declining spiral of civilisation.

Q: How far can this go?

A: For a government with a neoliberal viewpoint, there is no limit. They do not see people, they only see numbers and goals. At the end of the day, it is a settling of scores with the April Revolution (or Carnation Revolution, when army captains democratised Portugal in 1974), which brought in a collection of rights that gave value to work and dignity to people.

The government (of Prime Minister Pedro Passos Coelho) remains stone-hearted in the presence of parents who have lost their jobs, children who are denied their right to work, parents whose social protections are withdrawn, children who are forced to emigrate, and elderly people who cannot afford to buy the medicines they need to survive.

Q: What does the CGTP propose?

A: We think that it is not enough to talk about growth. Growth is only possible with investments, more production, better income distribution and higher spending power. To us, these components are essential to solve the fundamental problem.

(END)

Excerpt:

Poverty in Portugal has risen to levels that were unimaginable a year ago despite the bleak outlook forecasted by the harsh measures imposed by the troika of creditors in exchange for the country’s financial bailout.

An eatery in Lisbon offers cheap “troika” lunches to weather the crisis. Credit: Katalin Muharay /IPS

Unable to pay their bills or even meet basic food needs, thousands of families are facing dire times and turning increasingly to charities for assistance. Many do so secretly, however, ashamed to admit they have to resort to such means to get by.

The phenomenon has become so widespread that the impoverished middle class is starting to be known as the “embarrassed poor”.

This new poverty, caused by unemployment and the inability to repay bank loans, is also driving up the number of suicides, according to reports by Caritas, Food Bank and other social solidarity organisations.

According to figures from the National Statistics Institute, in 2012 a fifth of all Portuguese were living on less than 478 dollars a month, well under the minimum wage established by law at 644 dollars a month and 14 salaries a year.

In June 2012, a year after the troika – comprised of the European Union (EU), the International Monetary Fund (IMF) and the European Central Bank (ECB) – stepped in with a bailout package, soup kitchens have sprung up across Lisbon, bringing back the “sopa dos pobres” served out by Catholic organisations to feed the poor in the 1950s.

Today long lines of people can again be seen queuing outside charity centres waiting to receive their only hot meal of the day.

Teachers around the country report alarming cases of middle-class children coming to school on an empty stomach, dizzy and even fainting from hunger, but trying to act normal so as not to be confused with poorer children.

Middle-class Portuguese people of all ages are finding it hard to accept the fact that their dream of attaining the upper middle-class status they had been working towards for the past two decades is slipping away.

Those efforts are, in fact, having the opposite effect, experts say. Buried under a mountain of unpayable debts, the middle class is sinking closer and closer to the lower class, which at 24.4 percent has increased two percentage points since 2009, in a population of 10.6 million.

According to the National Statistics Institute anyone with an income between 768 and 2,660 dollars a month is considered middle class, in a country where half the population earns less than 932 dollars. Officially, around 60 percent of the population falls within that definition.

“In Portugal, poverty is becoming part of the scenery,” João Pedro da Fonseca, a young unemployed electrician specialising in generators, told IPS.

After a decade on his own, enjoying a high standard of living, he had to move back in with his parents and depend on their meagre pensioner income, “with little hope of finding work” in his field.

Out of a job for nearly a year now and with no unemployment insurance, this 29-year-old Lisbon native believes “this is just the beginning of a long period of poverty, a terrible crisis that I’m not responsible for, caused by the usual powerful men.”

Marina Oliveira, a 26-year-old psychologist who has been unemployed for the past 13 months, told IPS that when a crisis hits — no matter where in the world — “poverty only comes calling at the doors of the most vulnerable.”

She survives thanks to her parents, who are helping her “until I can leave the country to follow my dreams, which sadly have become impossible in my country, where poverty is only going to get worse, as new measures are imposed to pay the troika back,” Oliveira said.

The troika granted the Portuguese government a total of 110 billion dollars to service the national debt, meet administration costs and, above all and despite great criticism, provide capital for its distressed banks.

Oliveira highlighted that other countries have also suffered “these crises imposed by the promoters of the consumerist dream, who never get stuck with the bill.”

“The most outrageous example of this is the United States, where some of the leading people responsible for the 2008 crisis, which later spread across the world, were invited by (President Barack) Obama to serve as advisers and consultants for his administration,” he said.

In “Portugal we have to live under the rules dictated by this enormously powerful troika, making us bow to a global financial system that is unscrupulous and completely heartless and that forces us to surrender our country to that pack of vultures that are the large banks.”

The latest statistics available indicate that in 2011 Portugal had a gross domestic product (GDP) of 214 billion dollars and its national purchasing power stood at 77.4 percent of the average purchasing power for the EU.

Preliminary data for 2012 reveal a drop of 2.9 percentage points in Portugal’s GDP, confirming the downward trend observed since the start of the crisis. From 2009 to the end of 2013 it will have dropped by a total of 7.4 percent, according to projections released by the Bank of Portugal on Jan. 15.

For the victims of the crisis, the last straw came on Jan. 10 with the IMF’s new recommendations.

In a document addressed to the Portuguese government, the IMF called for greater austerity, which is certain to affect an already besieged middle class that in 18 months lost almost 25 percent of its purchasing power.

The IMF recommends a new package of measures, with additional cuts in pensions and wages, in particular in sectors such as education, health and law enforcement.

It also recommends raising public hospital fees, firing 14,000 teachers, placing 50,000 elementary teachers in a mandatory relocation scheme and privatising public education.

In his Jan. 22 opinion column, featured in the Público de Lisboa newspaper, analyst José Vítor Malheiros noted that this policy of drastic cuts is applied “only to social areas, never affecting the benefits of the (wealthiest) one percent”, and it is aimed at “pleasing creditors and perpetuating Portugal’s dependence on the financial system”.

Among the many waiting in line at a Lisbon Employment Centre, a man in his forties told IPS that he comes to the centre every day in the hope of finding “any job they can offer me, because I have a 12-year-old daughter and we’re both going hungry.”

He agreed to talk to IPS but asked to remain anonymous “because I’d like to speak frankly and, if I give you my name, they’ll never give me a job.”

He also refused to give his profession or trade, merely noting, “I was foolish enough to think that a university degree would guarantee a decent future. But here I am, willing to take any job.”

“Portugal has been gripped by fear, a fear that’s spreading thanks to outrageous policies. And those who are lucky to still have a job are bending over backwards to please their bosses, afraid they’ll be fired and will have to join the ranks of the new poor.”

By Ignacio Ramonet
PARIS, France, Jan 9 2013 (IPS)

Having survived the announced end of the world on Dec. 21, we can now try to foretell our immediate future, based on geopolitical principles that will help us understand the overall shifts of global powers and assess the major risks and dangers.

Ignacio Ramonet

Looking at a map of the world, we can immediately see some hotspots lit up in red. Four of them represent high levels of danger: Europe, Latin America, the Middle East and Asia.

In the European Union (EU), 2013 will be the worst year since the beginning of the crisis in 2008. Austerity is the only creed and deep cuts to the welfare state continue because Germany, which for the first time in history dominates Europe and is ruling it with an iron fist, wills it so.

In Spain, political tensions will rise as the Generalitat de Catalunya (Government of Catalonia) decides the terms of a local referendum on independence for this autonomous community (province), a process that will be watched with great interest by the separatists in Euskadi, the Basque Country.

As for the economy, already in dire straits, it all depends on what happens – in the Italian elections in February; and on how the markets react to a possible win by conservative candidate Mario Monti, who has the support of Berlin and the Vatican, or by centre-left candidate Pier Luigi Bersani, who is the frontrunner in the polls.

Social explosions could occur in any of the countries of southern Europe (Greece, Portugal, Italy or Spain), exasperated as their people are with the constant cutbacks. The EU will not emerge from the doldrums in 2013, and everything could get worse if, on top of it all, the response of the markets is brutal (as neoliberals are urging) in France under the very moderate socialist President François Hollande.

In Latin America, 2013 will also be a year of challenges. In the first place, in Venezuela, which since 1999 has been a driver of progressive changes throughout the region, the unforeseen relapse in the health of President Hugo Chávez – re-elected Oct. 7 – is creating uncertainty.

There will also be elections on Feb. 17 in Ecuador. President Rafael Correa, another key Latin American leader, is expected to be re-elected. On Nov. 10 important elections will be held in Honduras, where former president Manuel Zelaya was toppled on Jun. 28, 2009. The Electoral Tribunal has authorised the registration of the Partido Libertad y Refundación (LIBRE – Freedom and Refoundation Party), led by Zelaya.

Chileans are due to go to the polls on Nov. 17. The unpopularity of conservative President Sebastián Piñera opens the way for a possible victory by socialist candidate and former president Michelle Bachelet.

International attention will be focused on Cuba as talks continue in Havana between the Colombian government and the Armed Revolutionary Forces of Colombia (FARC) with the aim of putting an end to Latin America’s last armed conflict.

Meanwhile, there again appears to be a stalemate in the Middle East, the location of the most disturbing events in the world.

The Arab Spring uprisings toppled several dictators in the region: Zine Ben Ali in Tunisia, Hosni Mubarak in Egypt and Muammar Gaddafi in Libya.

But subsequent elections allowed reactionary Islamist parties, like the Muslim Brotherhood, to come to power. Now, as we are seeing in Egypt, they want to hold onto it at all costs, to the consternation of the secular segments of society who had been the first to rise up in protest, and are refusing to accept this new form of authoritarianism. Tunisia faces the same problem.

After following with interest the explosions of freedom in the spring of 2011, European societies have again become apathetic about what is going on in the Middle East.

For example, the inexorably deepening civil war in Syria clearly shows how the big Western powers (the United States, the United Kingdom and France), allies of Saudi Arabia, Qatar and Turkey, have decided to support – with money, arms and instructors – the Sunni Islamist insurgents. On all fronts, they are gaining ground. How long can the government of President Bashar al-Assad last?

In the face of the “Shiite Front” (Lebanon’s Hezbollah, Syria and Iran), the United States has built a broad regional “Sunni Front” (from Turkey and Saudi Arabia to Morocco, including Egypt, Libya and Tunisia). Its goal: to overthrow Bashar al-Assad and deprive Teheran of its big regional ally by next spring.

Why? Because on Jun. 14 Iran will hold presidential elections, in which incumbent President Mahmoud Ahmadinejad is not eligible to stand. In other words, for the next six months Iran will be immersed in a violent election campaign between partisans of a hard anti-Washington line and supporters of negotiations.

Given this situation in Iran, Israel will no doubt be preparing for a possible attack on Iran’s nuclear installations. The Jan. 22 elections in Israel will probably result in victory for the ultra-conservative coalition that supports Prime Minister Benjamin Netanyahu, who is all for bombing Iran as soon as possible.

Meanwhile, U.S. President Barack Obama is looking toward Asia, a priority region for Washington since it decided on a strategic redirection of its foreign policy. The United States is attempting to curb the expansion of China by surrounding that country with military bases and relying on the support of its traditional partners: Japan, South Korea and Taiwan.

China’s seas have become the areas with the greatest potential for armed conflict in the Asia Pacific region. Tensions between Beijing and Tokyo caused by the sovereignty dispute over the Senkaku/Diaoyu Islands could be heightened following the Dec. 16 electoral victory of Japan’s Liberal Democratic Party, led by the new Prime Minister, Shinzo Abe, who is a nationalist hawk.

China is moving full speed ahead with the modernisation of its navy. On Sept. 25 it launched its first aircraft carrier, the Liaoning, with the intention of intimidating its neighbours. Beijing is increasingly intolerant of the U.S. military presence in Asia. A dangerous “strategic distrust” is building between the two giants, which will doubtless leave its mark on international politics in the 21st century.

(END/COPYRIGHT IPS)

Excerpt:

A riot policeman in Greece attacks a protester during an anti-austerity rally in Athens. Credit: PIAZZA del POPOLO/CC-BY-2.0

By Julio Godoy
BERLIN, Nov 16 2012 (IPS)

The austerity programmes being rolled out in virtually every member state of the European Union (EU) – particularly in Greece, Portugal, Spain and Italy – have failed to reach their stated objective of consolidating public finances in order to solve sovereign debt crises.

Instead, these programmes – which entail massive public spending cuts in sectors such as education, health and governance – are “leading to collective folly” and even to “a social breakdown” across the continent, according to numerous economic experts.

Far from solving the debt crisis, as promised, the current fiscal consolidation plans will result in higher debt-GDP ratios in the EU in 2013, according to recent research.

Several reports have now confirmed what economists and activists warned months and even years ago: that the economic crisis, triggered by the financial collapse of 2007-2008 and the subsequent state-sponsored bailout of banks and investment funds, has resulted in higher unemployment and poverty rates in every country.

According to figures published by the official European statistics office, Eurostat, youth unemployment in Greece, Ireland, Italy, Portugal and Spain is presently above 30 percent.

The situation is particularly difficult in Greece, where youth unemployment has more than doubled since 2008, to reach 55.4 percent in 2012. In Spain, where a 37 percent youth unemployment rate was the norm in 2008, the crisis has rendered over 50 percent of the youth labour force jobless.

Further deterioration of the social climate in Greece, where unions have orchestrated a wave of general strikes against yet another bout of state budget cuts, this time worth 17 billion dollars, augurs ill for the future of the Union under the shadow of austerity.

In its newest Global Prospects Report, released on Nov. 5, the London-based Centre for Economic and Business Research (CEBR) predicts that the Eurozone recession will continue through 2013, with only “marginal growth … likely” in 2014.

According to the CEBR, the outlook is particularly calamitous in Greece, Italy, and Spain, with negative economic growth prospects. The report forecasts contractions of gross domestic product (GDP) in all three countries for 2013, of seven, 1.8, and 2.2 percent respectively.

“The economic situation in some parts of Europe is moving from bad to catastrophic,” Douglas McWilliams, chief executive of CEBR and a co‐author of the report, told IPS. “There is a danger that the economic problems will spill over into social breakdown in many areas of Europe as unemployment soars and governments run out of money.”

Yet another analysis of the economic and social situation in Europe, released Nov. 1 and authored by two leading economists at the London-based National Institute of Economic and Social Research (NIESR), goes even further, arguing that the austerity programmes across the continent are “self-defeating”.

The NIESR’s most benign scenario for 2013 forecasts a worsening of the present depression. According to their calculations, the austerity programmes will have a negative impact on the debt-growth ratios of 8.9 percent in Greece, 7.7 percent in Portugal, 4.2 percent in Spain, and 1.9 percent in Italy.

Jonathan Portes, co-author of the study, told IPS that his analysis of the present fiscal policies in Europe leads to the conclusion that “while in ‘normal times’, fiscal consolidation would lead to a fall in debt-GDP ratios, in current circumstances…fiscal consolidation is indeed likely to be ‘self-defeating’ for the EU collectively.”

Youth hit hard by austerity

In a study released late October, the European Foundation for the Improvement of Living and Working Conditions (Eurofound), an autonomous body of the EU, emphasised, “The immediate future of Europe depends upon the 94 million Europeans aged between 15 and 29.”

According to the study, the youth unemployment rate was 33.6 percent (or 19.5 million people) in 2011, “the lowest level ever recorded in the history of the European Union”.

However, there is huge variation between EU member states, with rates varying from below 7 percent in Luxembourg and the Netherlands, to above 17 percent in Bulgaria, Ireland, Italy, and Spain.

“The consequences of a lost generation are not merely economic,” the Eurofound report warns, “but are societal, with the risk of young people opting out of democratic participation in society.”

The drain of an unproductive youth force – in terms of lost output – amounts to some 153 billion euros annually, or 1.2 percent of the EU’s GDP, according to the Eurofound report.

Stefano Scarpetta, deputy director for Employment, Labour and Social Affairs at the Organisation for Economic Co-operation and Development (OECD), charged that Europe was “failing in its social contract” with the young, and warned that political disenchantment could reach levels similar to those that sparked the North African uprisings that have been dubbed the Arab Spring.

According to a report released last May by the International Labour Organisation (ILO), unemployment among young people in North Africa jumped five percentage points in 2011, to 27.9 percent.

“North Africa and the Middle East stand out in terms of their overall unemployment problem and these are the only two regions where the unemployment rate exceeded 10 percent in 2011 for the population aged 15 and above,” according to the ILO.

That situation is now true in various EU member states, where discontent has emerged in the form of ‘indignados’ in Spain and mass youth mobilisations in Portugal, Greece, and elsewhere in Southern Europe.

Peter Matjasic, president of the European Youth Forum, the representative body of more than 90 national youth councils and international youth NGOs, urged the EU to make the European “vision (of a social democratic society) a reality for a generation.”

Matjasic also demanded that expectations raised by the bestowal of the Nobel Peace Prize upon the EU this year be fulfilled. “The Nobel committee (talked) of the success of the ‘European dream’ and European leaders this week spoke about strengthening it. But without investing in youth now, it is in danger of becoming a lost dream.”

(END)

Lallmamode Mohamedally, a Mauritian fisher, points to a European vessel offloading its catch at the port near Les Salines, a fishing town close to the country’s capital Port Louis. Credit: Nasseem Ackbarally/IPS

By Nasseem Ackbarally
PORT LOUIS, Aug 9 2012 (IPS)

“Look out there, the blue one…. that is a European Union fishing vessel that is threatening our livelihood,” says Lallmamode Mohamedally, a Mauritian fisherman, as he points to a boat offloading its catch at the Les Salines port, close to the country’s capital Port Louis.

He is one of the fishers who have returned after a hard day at sea with their boats almost empty. Pollution and tourist activity have reduced the fish catch on the island’s lagoons over the past few years.

But local fishers say a February agreement between the EU and this Indian Ocean island nation, which allows European vessels to catch 5,500 tonnes of fish a year for three years at a cost of 660,000 euros annually, has made the situation worse.

While there are no official figures to confirm this, the 3,500 local fishers, who now have to compete with modern industrialised fishing boats, say that their catch has gone down by 50 to 60 percent.

And the Les Salines fishers believe that the 86 vessels from companies based in the EU, which are fishing in the area, are stealing their livelihoods.

“These big vessels are scratching the sea around Mauritius and taking away all the fish,” says Mohamedally.

While most fishers want the EU vessels to leave, Mohamedally says he would not mind them operating in Mauritian waters “only if they fish like everybody else, like the Taiwanese and the Japanese.”

“Only longliners please. No seines. Those vessels catch all types of fish, small and big alike,” he says.

Long line fishing is a commercial technique that uses hundreds or sometimes thousands of baited hooks, which hang from a single line. This type of fishing commonly targets swordfish, tuna, halibut, and sablefish. Seines use surrounding nets.

However, Mauritian authorities believe that this is the only way to exploit its vast exclusive economic zone or EEZ of 2.3 million square kilometres.

Local fishing companies here are small and do not have the ability to fish on such a large scale. The 5,500 tonnes of fish that Mauritius has allowed the EU to catch each year is in stark contrast to the few tonnes the 34 fishermen of Les Salines catch in a year.

Currently the fisheries sector in Mauritius represents only one percent of the country’s GDP, and the local fish production is only 5,100 tonnes.

Mohamedally says that in the past fish were abundant three to four nautical miles from the coast. Today, the fishers travel almost 15 nautical miles out to sea, but many still come back without a catch.

“What will happen in five years time to our jobs? They are giving us an egg and taking an ox out of our sea,” adds Mohamedally, referring to the 660,000 euros annually that Mauritius has agreed in payment by the EU in exchange for fishing rights in its EEZ.

Judex Rampol, chairman of the Syndicat des Pêcheurs, a fishers’ association, is furious about this. “This is peanuts,” he tells IPS. If local fisherfolk had the capacity to fish so far out at sea, they would earn about 15 million euros for the 5,500 tonnes of fish the EU is now allowed to catch.

However, Minister of Fisheries Nicolas Von-Mally believes Mauritius needs help to exploit its vast EEZ.

“We have no fishing vessels. Should we depend on locals, many fishes would have long died of old age,” he says.

Von-Mally adds that canning factories on the island process the tuna caught by the EU vessels. However, it is sold mainly on the European market.

He adds that tuna is migratory, and if it is not caught in the Mauritian EEZ, it will swim to the zones of the neighbouring Indian Ocean islands of Seychelles and Maldives. “We’ll thus lose revenue,” he says.

Bahim Khan Taher, manager of Taher Seafoods, a small local fishing company, tells IPS that he would like to exploit Mauritius’ fish stock, but he needs modern vessels, equipment and financial incentives to fish in the EEZ.

“If we get some help from the government in terms of fiscal incentives, we could also go out fishing there. This would boost our seafood hub exports,” Taher says.

Meanwhile, environmentalists are concerned that overfishing may deplete tuna stocks in the Indian Ocean. Mauritian oceanographer and environmental engineer Vassen Kauppaymoothoo is one of them.

“The EU vessels are here because the stocks in the other oceans have collapsed. They have been overfished by vessels from Portugal, France and Spain. The only ocean where there is still some fish is the Indian Ocean,” he tells IPS, adding that 5,500 tonnes a year was overfishing and would deplete resources.

He adds that while Mauritius does not have the capacity to fish its EEZ, this does not mean that they should allow foreigners to do so. He says Morocco decided to close its EEZ to foreigners in a decision to solely keep its fish stock for its local population.

“There is no reason to loot my house because I do not have the means to exploit its wealth,” Kauppaymoothoo argues.

But the head of the EU Delegation in Port Louis, Alessandro Mariani, tells IPS that they are helping to create jobs, not take them away.

“In Mauritius alone, 5,500 jobs benefit from the tuna that is disembarked by the EU vessels,” he says.

Mariani claims that there is no competition between the EU fleet and the local fishers because they operates very far away from each other. The EU vessels fish 15 nautical miles from the coast, and the locals at three nautical miles.

“We are also targeting different fish species,” he says.

Mariani says the EU is very sensitive about the tuna stocks in the Indian Ocean.

“Our fishing efforts are guided by scientific research. The Indian Ocean Tuna Commission Scientific Committee said in October 2011 that there is no overfishing in this region,” he says.

Von Mally adds: “We are not shooting at our own feet. We want fish to be always available in our seas for future generations.”

They both deny that the EU placed pressure on the Mauritian government to sign the agreement. “This is simply not true. Mauritius and the EU are partners and we always discuss things about the interest of both the EU and Mauritius,” says Mariani.

The flood of economic woes devastating Greece and Portugal are evidence that the German prescription imposed by a troika of multilateral creditors is not working, and that both countries are heading into a blind alley, says economics professor Mario Olivares.

“National debt and fiscal deficit problems can only be overcome by economic growth,” Olivares, a Portuguese academic, told IPS.

The harsh austerity programmes prescribed by the International Monetary Fund (IMF), the European Union and the European Central Bank (ECB) are dragging Greece and Portugal into a downward economic spiral.

In these two southern European countries, and more recently in Spain and Italy as well, “growth and investment are being sacrificed, creating an alarming increase in unemployment,” said Olivares, head of the economics department at the School of Economics and Management (ISEG) of the Technical University of Lisbon.

“There is colossal pressure on the Greek economy, which has already seen a fall in GDP far greater than forecast, due to an adjustment model that isn’t working because, in spite of wage cuts, exports are not increasing,” he said.

The crisis in Spain, Portugal and Greece, “with cuts in consumption and public spending, as well as slower growth in Germany, the Netherlands, France and Belgium, change the scenario, because the expected increase in exports is not happening,” Olivares stressed.

In the case of Portugal, public accounts are being regulated with iron discipline in order to meet the fiscal deficit goals demanded by German Chancellor Angela Merkel, whom Olivares describes as “master of the EU” in contrast with the weakness of the European Commission, the bloc’s executive arm.

Economic analysts agree that the wage cuts, longer working hours, cancellation of several public holidays and tax hikes have led people in Portugal to spend less and save more, not to create a solid foundation for stability, but to sink further into poverty.

The recession deepened in the last quarter of 2011 because of contraction in household consumption and only modest investment, factors that brought about a 2.7 percent fall in GDP that quarter, and an annual average shrinkage of 1.5 percent of GDP with respect to 2010, according to the National Institute of Statistics (INE).

The INE report predicted that “acceleration of the recession in the last three months of 2011 will set a trend that will also blight 2012, during which we expect a new fall in private consumption.”

The most recent estimates forecast a three percent drop in Portugal’s GDP this year.

A crucial factor is that Portugal’s 20 largest companies invested 23 percent less in 2011 than in 2010, which severely affected economic growth and produced drastic job losses.

In its report released Feb. 15, INE said unemployment in the fourth quarter of 2011 reached 14 percent, the highest jobless rate in Portugal since records began to be kept. Youth unemployment is even worse, at 35.4 percent.

But the situation is much worse than the official figures suggest, as INE recognises only 770,000 unemployed persons within an economically active population of nearly 5.6 million – a figure that only includes unemployed persons who were available for work, and actively seeking work, during the survey period.

It does not include those who have given up looking for a job, nor people with part-time jobs.

Thus, the real number is almost 1.3 million people out of work, which gives an estimated unemployment rate of 22.6 percent.

Given the fear of contagion of the crisis in the rest of the EU and other parts of the world, IPS consulted Professor Andrés Malamud, who holds a doctorate in social and political sciences and is a research fellow at the Institute of Social Sciences of the University of Lisbon. Like Olivares, Malamud is not at all optimistic about the future.

“In the best-case scenario, the European economy is going to stagnate for several years. The most probable outlook is simply recession, accompanied by social unrest, political radicalisation and institutional fragmentation, with some countries leaving the eurozone and even the EU itself,” said Malamud.

Asked what repercussions such a situation might have in Latin America, he said it would depend on “how far the European economy falls, and whether China has a soft or a hard landing (gentler or more abrupt deceleration of growth).”

Malamud contrasted Brazil, the largest economy in Latin America, “which is adjusting quickly and preparing itself for the shake-up, with  Argentina, which is making tardy, inept adjustments that are unacknowledged in official discourse, as the government talks of ‘fine tuning’ the economy, not ‘adjustment.'”

Olivares, for his part, told IPS that “the European economy is feeling the effects of austerity, with several countries in recession, subjected to concrete austerity plans by the troika or of their own free will, because of higher interest rates on sovereign debt bonds.”

Credit rating agencies “are continuing to lower their ratings of countries and companies, which can be interpreted as a lack of confidence in the fundamental solution for the debt problem in countries in southern Europe, but also as a sign of sluggish economies.”

The repercussions that will be felt in the global economy and particularly in Latin America “have been, so far, a contribution to increased turmoil in financial markets, which in any case have benefited by speculation on sovereign debt bonds,” he said.
Latin America “is at a unique juncture since the 2009 crisis, as the region has gradually shifted its trade towards the Asia Pacific area.”

The region has plumped “primarily for China, its top trading partner at the moment, and has also received enormous amounts of investment from the Asian giant, so that the impact of a European recession can be faced with greater peace of mind,” Olivares concluded.