De Jong: EU crisis measures lack any prospect of promoting recovery

19 May 2010

De Jong: EU crisis measures lack any prospect of promoting recovery

EU Finance Ministers met yesterday to work out what measures could be taken at European level to deal with the crisis. Their plans consist primarily of spending cuts and budget discipline. According to Dennis de Jong, Chair of the SP group in the European Parliament, these plans lack any vision of structural economic recovery and will undermine Europe's social character.

Dennis de Jong"I only hear the ministers talking about budget discipline and the stability pact," says De Jong, "but never about the quality of public services or the fight against poverty. This could and must become more even-handed. In the case of Greece, the only realistic way to attainable, solidarity-based crisis measures is via a partial write-off of state debt. This would kill two birds with one stone: it would prevent economic recovery in Greece from being economised to death, and at the same time we would be sending the bill for the crisis to the banks whose speculation brought it about."'

In the SP's view, only a partial relief of state debt can offer Greece the necessary starting point for recovery, via lower interest charges. De Jong warns that if we do not do this, we will be confronted in a short space of time with a new crisis. "What we are now asking of Greece is not realistic. A stable point of departure is needed, because combating corruption and bringing about fundamental reforms can't be achieved in a couple of years, however necessary such reforms may be. In the last two years we in the Netherlands have already had to find an additional €2.4 billion in interest charges, because we had to save the banks. With the new rescue package following on the eurocrisis, the taxpayer is once again coming to the aid of the speculators. You might then feel that it would be best to ask them to make a sacrifice. Leave the money where it is and let the speculators pay the price of their reckless behaviour, instead of expecting us to reward it."

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