International

Predictions fill the air. According to some, the economic crisis has hit bottom. Others say there’s more heavy weather on the way. Some argue that the European Council summit this month showed that we don’t need to fear still more interference from Brussels in our national socio- economic policies. Others reckon we may have another think coming. Myself, I try to be realistic: optimistic economic predictions are for the most part aimed at renewing confidence, so that we start spending again. So I don’t believe them. And one European Council that could ‘only’ reach agreement on a banking union doesn’t mean that Van Rompuy and his officials aren’t continuing to work towards a federal Europe. So my slogan for 2013 is that the SP must stay alert and not allow ourselves to be lulled to sleep.

It’s true that European Central Bank boss Mario Draghi, has for the sake of his own peace of mind made sure to make clear that the Bank will do everything possible to rescue member states which find themselves in difficulties. This has established in the minds of speculators the idea that there will be less profit to be made through gambling on the bankruptcy of one or more countries in the Eurozone. At the same time Draghi has said that he is only prepared to help, for example by buying up the bonds of weaker Eurozone states and thus maintaining manageable interest rates for those countries, if the member states commit themselves to a policy of harsh austerity and harsher ‘reforms’. And it is precisely these policies which have led ever more Eurozone countries into deep recession.

When what’s needed is an investment programme, Draghi continues to insist on contraction of the state. He makes no distinction between government spending as a consumer, which has only a one-off effect, and investments in for example infrastructure or education. Such investments do not constitute money down the drain, but money with which something is built which will go on creating growth and employment for a much longer period. As long as Draghi and others refuse to hear the advice of the International Monetary Fund and others including ever increasing numbers of economists, to drop the budget fetishism and invest, the Eurozone will remain unstable. Even if the financial markets are temporarily calmed, the enormous differences between North and South within the Eurozone will only become greater, because austerity policies have led to a huge shrinking of the latter’s economies. In the end this development will push the entire Eurozone over the edge and into the abyss.

So I don’t rule out a full-blown return of the Eurocrisis in 2013. I know all the government leaders’ answers, which amount to the need for a leap forward in the direction of a political union. Member states, they say, can’t deal with this alone; they need leadership from Brussels. That’s why I’m convinced that in the weeks to come Van Rompuy’s team, together with officials from each of the member states, will be working hard to develop his ideas. And then during the European Council in June we will after all see a decision that national budgets must in the first instance be judged and amendments made to them by Brussels, before the national parliaments are brought into the game. And member states will be encouraged to draw up official contracts with Brussels regarding the ‘necessary reforms’.

Perhaps 2013 will be a fine year with economic growth, lower unemployment and less poverty. I heartily hope that turns out to be the case. But for it to happen, in many European states neoliberal governments must be replaced by more socially-minded leaders. This is true of the Netherlands, as well, because it is now clear that the Labour Party is in the grip of budget fetishism. Amongst ordinary people throughout Europe unrest is growing. They have had enough of the neoliberal grasping economy. That offers hope, because it is on the strength of these people that the question of whether 2013 will be a fine year or not hangs. I wish everyone, then, much strength in the New Year.