Sunday, February 1, 2009

Buckling Europe fears protests may spark a new revolution

Buckling Europe fears protests may spark a new revolution

Adrian Michaels

Go To Original


THE French are revolting. Teachers, television employees, postal workers, students and masses of other public-sector workers will today be united in a hugely popular strike with car workers, supermarket staff, journalists and thousands of others in the private sector.

One poll said that 75 per cent of the public supported the action, which has the backing of the large union groups and opposition socialists. It will be a big test for President Nicolas Sarkozy but, more importantly, the strike will mark the biggest protest so far in one of the world's largest economies against the grief and distress being caused by the catastrophic global downturn.

A depression triggered in America is being played out in Europe with increasing violence, and other forms of social unrest are spreading. In Iceland, a government has fallen. Workers have marched in Zaragoza, as Spanish unemployment heads towards 20 per cent. There have been riots and bloodshed in Greece, protests in Latvia, Lithuania, Hungary and Bulgaria. The police have suppressed public discontent in Russia, and will be challenged again at large gatherings this weekend.

This is turning into Europe's winter of discontent. Protests are widespread and gathering pace. It seems to be about national interests superseding the common cause that has united countries for decades.

Parallels between the 1930s have tended to focus on the numbers — a lack of growth and waning consumer confidence, an increase in business failures and job losses, collapsing sharemarkets and currencies, and panicky runs on banks.

But the 1930s were so much more than that. Economic hardship spawned demonstrations. It allowed extremists to gather support after a loss of faith in mainstream political movements. Economic catastrophe bred Franco, Mussolini and Hitler.

Do the protesters across Europe sense once again that their governments do not know what to do? Or is it melodramatic to worry about such a parallel?

Politicians are being assailed for their lack of competence. Mainstream parties — the left in France and Germany, for example — are bickering and in crisis. France's mainstream unions have, in some cases, been following the actions of more radical groups such as SUD-Rail, which called a wildcat strike at a Paris rail station and stranded thousands of commuters. In Italy, traditional scapegoats such as immigrants are being expelled by populist politicians.

The Continent has been turned upside down as governments struggle to cope. Whatever was bad — state aid, bigger budget deficits, mass bail-outs — is now good. "Governments are making it up as they go along," says Alan Ahearne, an economist at the Bruegel think tank in Brussels. "They are doing it on the fly."

Worse is that the institutions created to keep the peace after the Second World War are being over-ridden. The European Union, formed in the 1950s mainly as a way to stop the citizens of France and Germany from killing each other, is having its rules ignored as countries take unilateral action to safeguard jobs and businesses.

Brussels has made token noises about the rules of the single market being respected again some day, but its guidelines on bail-outs merely follow actions by member states.

Another reason for discontent is that this is the euro's first recession. Euro zone countries can no longer devalue and boost exports, assuming anyone still had the money to buy goods.

And while Germany and France can boost domestic spending, Portugal and Greece do not have the money. In smaller countries, people are protesting because all they see in their future are cuts in wages, reductions in living standards, spending cuts and tax increases as their governments struggle to restore order.

In April, the G20 group of developed and developing nations will gather in London and have another chance to set the right strategy. US President Barack Obama has started telling Americans that they will have to take a share of the pain, and that a fix will be a long time in the making.

In contrast, Europe's leaders are struggling to convince their people to do the same. Instead, disgruntled voters sense chaos and a lack of purpose.

No comments: