EUROPE: THE PANDEMIC AND FAILURE OF THE CAPITALIST EUROPEAN UNION

 

A recent meeting of the European Commission has laid bare all the fragilities in the structures of the European Union’s policy. That meeting was held to set up a European Recovery Plan for the EU member countries faced with the Covid19 pandemic and the crisis it generates. The leaders implicated showed their lack of interest and their lack of audacity in adopting new procedures. They gave not the slightest answer to the needs of the populations, although these have already paid the high price and continue to pay it: Tens of thousands have died, millions of jobs have been lost, entire regions are in distress. Now migrants, refugees and undocumented persons, abandoned by the thousands, are knocking desperately on the doors of the ‘rich’ European Union.

Presentation:

In each European country – the United Kingdom included – the trade unions and the working class come increasingly face to face with the same problems of loss of jobs, renters’ evictions, the rise of neofascism, poverty, growing hunger and the world military preparations of the capitalist class. As this gives rise to the same movements in every country, it becomes easier to adopt the same working-class and socialist demands on a European scale. 

7.10.2020

The pandemic has struck the European populations cruelly, especially the poorest. If the enormous difficulties  were in some way dealt with, it is thanks to the response of the health workers and the solidarity of tthe workers and masses. Many strikes broke out to impose sanitising in the non-essential companies where the bosses insisted on their right to continue producing at all costs. Workers adapted their companies’ tools to the making of respirators and masks. In the workers’ areas of the big cities, tens of thousands of persons organised the distribution of food and medicine to the less well-off. This formidable display of solidarity is set to continue in the coming struggle, to get out of the current situation.

The doctors and the health workers have suffered the worst consequences from years of destruction and cuts imposed on the public health systems created in 1945, at the end of the war, in the big European countries. For at least 30 years, funding for the public hospitals, the prevention campaigns, community medicine, care services for the elderly were directed to private industry. Whilst public medicine makes a point of giving health to people, private medicine needs people to be ill. It lives off people being sick.

Excess mortality in the retirement homes gave the brutal demonstration of this criminal unconcern. Testimonies from carers exposed the inhumane conditions, the poor hygiene, the poor nutrition and the mistreatment that  the residents suffer. The lack of adequate care allowed the rapid expansion of the virus. During the first months of the pandemic, it was in that sector that mortality took the highest toll. Let us denounce all those responsible, and have them tried for their crimes.

Protest of Health Workers in Spain
          Protest of Health Workers in Spain

The pandemic has been called the “pandemic of the poor” because the highest rates of contagion started in the working-class areas of the large cities. The cause being: bad social conditions, bad living conditions, precarious work, unemployment, cramped housing, poor nutrition. Capitalism stands exposed not just for its failure to unify Europe, but for its inability to deal with the social differences. If the bourgeoisie is “united” at the moment, it is through its need to dodge the economic and social catastrophe. If it occurs to those in the European Commission to “support” the poorest EU countries, it is to reduce the pressure of the struggle of the masses upon them.

For all its economic power, the EU has failed to make of the European Central Bank (ECB) a real banking centre to intervene in the economy, to inject money in the economy to reactivate it; a central bank to create a welfare state at European level – a strong and universal public health service aiming at a dignified life for the masses.

The European Recovery “aid” :

The recovery “aid” that the ruling classes are apportioning to each European country is clearly insufficient, and it causes important tensions and ruptures. The predictions of a 10-12% drop in GDP have been great underestimates in some countries, whilst the amount granted by the Commission barely reaches the 3-5% level of GDP. Most of this “aid” will end up in the coffers of the large companies in the “Funding to the States” column. In Belgium for instance, the State grants €350 million for the rescue of Brussels Air Lines, a subsidiary of Lufthansa, which is laying off hundreds of workers under the heading known as: “Respect for the social clauses”!

Hungary and Poland disrespect EU law and hail the US and NATO’s directives. They too are going to receive the aid, however. Their governments have been allowed to close their borders, suppress social and political protests, prosecute communist and socialist parties, imprison trade union and political leaders. Although of course, the same happens in the important States of the EU as well:  In France, President Macron repressed violently the Yellow Vests and the trade union and popular movements who fought against his Pension Reform. Indeed all the EU governments try to suppress the social protests and stop the entry of migrants on “European territory”.

The Failure of the “European” policy of capitalism:

European capitalism has not seen any growth since 1989.  Most of the Eastern European States – originally from the Warsaw Pact after World War II – are now part of the NATO’s front line to confront Russia. In fact, what these States represent, is the failure of the “European” policy of capitalism. These Workers’ States have been strongly conditioned by the policies of the post-war Stalinist bureaucracy of the USSR. But capitalism never offered them the “dignity” it talked about at the time of the Fall of the Berlin Wall (1989). Now these former Workers’ States are in thrall to the big companies in the European countries, especially Germany, and to the military aims of the United States and NATO. Their governments are led by the old Stalinist bureaucratic layers who contributed to the dismantling of their State-owned economies. They just live-off the exploitation of their countries’ subservience to the multinationals and to NATO.

The most obvious illustration of this process is in the former GDR (German Democratic Republic). In the GDR, the FRG (West Germany) acquired at very low cost the best companies and most important working-class capabilities. Never integrated, the rest of the society of the former GDR now lives in inferior conditions. The headquarters of major European companies are now in Hungary, Poland and others, where they recruit labour at low costs, well beyond trade union control, paying ridiculous taxes. The governments of these countries offer their territories as battlegrounds against Russia, although this is also happening in other EU countries like Italy, Greece, Spain and others.

Hidden rescue of the big private banks:

Since 1989, European capitalism has continued to concentrate with no growth. Little of the territory of Eastern Europe has been incorporated in any development in productive forces, markets, culture or science. Instead, the fall of the Workers’ States has been a great setback for the peoples living in them, and in the rest of Europe. Now capitalism exacerbates competition like Germany against France, against the UK, against the US. The Stimulus Funds are not included in the general balance sheet of the European Union. The contribution that each country must pay to the central rescue fund increases, the part of free support coming back as rescue decreases, and the difference becomes a loan: A loan with low interest rates, certainly, but that increases the public debt of each State towards the Banks. In reality, and just as happened after the 2008-2009 crisis, this is a hidden rescue for the big private banks.

The ECB lends to the private banks at 0% interest. The latter then lend to the States in the EU at interests between 2 and 5%, depending on the credit ratings. Due to this, Italy, Greece and Spain are charged the highest rates. In these countries, the States are now forced to borrow for the purchase of goods and services, and the repayment on previous loans. The multinationals and the big companies of the major European countries, meanwhile, spend most of their rescue on “Research and Development”. Germany and France invest up to 14% GDP in their recovery, whilst Spain and Italy only 3 to 5%. Such differentials get Europe increasingly dominated by the big German and French bourgeoisie and finance.

Finland, Belgium, Holland and Austria are set to be leading the European Recovery Plan [1], but they  keep the tax havens. In the public health services sectors, the leaders involved are committed to greater levels of privatisation to the benefit of the private insurance companies and  investment funds. Indeed, this is one of the ‘reforms’ demanded from the EU countries to qualify for the “aid”! All these measures are going to prevent the development of the various economies. They will deepen the social inequalities, lead to the total privatisation of the public services, make the less well-off even poorer. In a country that does not accept these conditions, the EU can block the aids.

The recovery agreement is transitory:

In the use of the aid which they receive, full liberty is granted to the multinationals and the large national companies. They can even give way to State-control, if they declare themselves sufficiently in crisis, temporary of course – time to get back on feet. In the current negotiations [2], all the austerity taboos have gone. There used to be “no money to make investments” but there is money now. Sovereign debt “could not exceed 30% of GDP” and now it can, without limits. State-aid used to be unthinkable, but it is allowed now.

Urgency has commandeered this intervention, but it does not, in any way, change the nature of European capitalism or the preponderance of the large electronics and military industries, automotive sectors, aeronautics, pharmaceutical & chemical industries, energy production and the services. The process of concentration and of competition is going to exacerbate, imposing new force relations inside the EU. With its Recovery Plan, the European Commission saves itself a little time while it looks for ways to lighten the effects of the crisis on the weakest capitalist sectors.

Demonstration in Brussels against the European Recovery Plan
Demonstration in Brussels against the European Recovery Plan

A secure job and a decent wage for all:

The masses must defend their rights and conquests, and make an economic development plan according to their needs. The masses can buy time too, and profit from the internal struggles of  the ruling class and   from the EU’s competition with China, Russia, the other BRICS countries and the United States. The workers and the peoples of Europe are going fight tooth and nail not to bear the brunt of this so-called Covid19 crisis. They are going to want the Recovery funds to return to them.

On a European scale, the historic experience of the Soviet Union still exists in popular memory, along with that of the great communist parties and trade unions. The masses have also in mind the more recent experiences of the left; although these did not succeed everywhere, they influenced governments as in Spain and Portugal. There is also the experience of Syriza in Greece, that of Corbyn and of the Labour left in the UK, and that of the great struggles in France where Yellow Vests and trade unions together held the Pension Reform back for quite a time.

We must defend all the rights won: no one should be evicted from their home because they cannot pay. No one must lose the job because the company fails. We need a universal minimum wage, guaranteed by the State, enough for all workers live on with dignity, and no-one to be left without an income.
The capitalist system has an interest vested in fewer workers. The process of sackings already in train before the pandemic is going to deepen. One of the reforms proposed by the EU is the development of digital technology (5G, Broadband, Digital intelligence, etc.). This leads inevitably to fewer jobs and more individual forms of employment in production. This will end up with fewer and more educated middle-class workers backed by raised technology, with the rest of the less educated workers in  trades, logistics and services.

Capitalism cannot guarantee full employment; it is not in its interests. The labour and trade union movement must demand State intervention to force the employers to keep full employment. It must call on the State to invest in the massive construction of houses, especially in the regions hit by earthquakes and floods. Invest in the protection of the natural and historical environment. Invest in training, education and culture.

A common plan to be implemented immediately must include reparations for the immense blow suffered by the elderly during this pandemic. Throughout the EU, the Pension Reforms are raising the retirement age. This must be stopped. The pension age must be universally at 60 for all those engaged in heavy work. The level of pension must start at 80% of the salary and rise with the cost of living. We must organise support committees for the elderly, and multiply these committees with the participation of the health workers and the trade unions. Those responsible for excess mortality in the retirement homes must be investigated and punished. We must call out the private interests that have wreaked havoc in the health structures.

It is important to generalize forms of co-determination, or of workers’ control, as the metallurgists have done in Germany, so that the industrial reconversions planned with State funds are under workers’ control. The workers’ movement must impose its conditions. It must determine the quality of the products and their socially useful character. The State must take charge of the companies in crisis, and the trade unions must impose workers’ participation in the planning and control of production. For a general reduction of the working hours and a sharing of all existing work.

All NATO missions in Africa, Asia and Latin America must be ended:

Migrants must be integrated into these plans with the view of linking all production plans with their countries of origin in Africa and Asia, and do away with all colonial and imperialist relations. These relations prevented the development of countries, and now they provoke the mass exodus of populations towards Europe. The EU will never be a democratic entity if it insists on its colonial relations of economic and military domination.  All NATO missions in Africa, Asia and Latin America must be ended.

We must establish a single European Tax System to seriously charge all the large fortunes, assets and financial deposits. The limits of our present European ‘Union’ could not be made clearer than when a recent judgment of the European Supreme Court of Justice ruled in favour of Apple: With its HQ in the Netherlands, this multinational – like many others besides – will be allowed to continue to profit from its tax haven in the Netherlands, the EU only managing to make it pay more in taxes.

The aim of the large companies, whether European, American or British [3], is to create “coordination centres” in countries like Belgium, for example, where they pay less taxes and benefit from lower wages. The decision of the European Supreme Court (over Apple) deprives the European common treasury of significant resources, but this is hailed in the Netherlands: Observe our beautiful community spirit!

Something similar happened when the German and French governments grabbed the surgical masks destined for Italy and Portugal. One is reminded of the outbidding of some PPE companies on prices already agreed before the pandemic, and of cases where supplies were diverted to the United States instead of to the rightful purchasers.

For a Europe that fights global warming and promotes disarmament:

The European bourgeoisies push for the complete opening the economy to competition and the dominance of the market. That is what they live from. But the workers cannot depend on the market, nor wait for their boss to gain dominance. Together they must overcome the difficulties posed by the pandemic which are now combining with those left by the previous capitalist crises; and now by the introduction of AI (artificial intelligence) in production. We demand a secure job and a decent wage for all. We must control the companies in receipt of State-funding, eliminate all the waste and all the patronage.

Businesses need to be reorganized for the protection of the environment. We must use renewable energies and eliminate the CO2 market. A significant CO2 reduction will be achieved by stopping the concreting of cities and radical trade reforms to stop consumer-goods travelling long distances in favour of local systems of production and distribution. The towns and the regions need to be re-planned, with the participation of the populations.

The Europe that we want must seek peace between its countries and put an end to their old colonialist and imperialist roles. The military industry must be converted into goods that are useful to the populations. NATO must be dismantled immediately: nearly 20% of the funds from the European Recovery Plan is bound to end up being part of the ‘military expenditure’ that the United States already demand from each of the European members of that criminal Atlantic Alliance. Unjustifiable! And weapons must stop being sold to aggressor countries like Egypt or Saudi Arabia, which use these very European weapons to massacre the Yemeni people.

NATO went on with the deployment of Operation Defender 2020 despite the dire Covid19 situation. We must impose an immediate reduction in the military budgets. We must get the Comprehensive Nuclear-Test-Ban Treaty (TPNW/UNTC) [4] signed, and stop the criminalisation of Russia, China, Cuba and Venezuela.

The communist, socialist, labour, environmental parties, as well as the more leftwards movements that pull away from their crises or from their compromises with capitalism, must act in united front with the trade unions’ movements to impose an industrial and social plan to lift Europe out of this pandemic-aggravated crisis. In this way, they must make progress in the direction of a socialist Europe. The socialist Europe is the only possible way to use all the existing economic, social, scientific and cultural capabilities, and to cooperate equitably with the rest of the world.

Posadists Today – 15 September 2020

The featured picture reproduces a photo taken by Gabrielle Lefèvre with her agreement. It was published in Belgium in an article entitled “The nurse and the Robocop”. It shows a face-to-face between police and Health protesters in Brussels during the demonstration attended by 4,000 Health Workers and their supporters on 13 September 2020. Mobilised around ‘La Santé en Lutte’, the Health workers demand more money for the Health Service, a stop to the commodification of Health, and better wages and conditions for themselves.

Notes:

[1] In the matter of distributing immediately the €750 billion stimulus throughout the EU, the leaders of Austria, Sweden, Denmark and Holland – and in part Finland – caused the European Commission to provide more in loans and less in grants to the Southern countries (mostly Italy and Spain) “to teach them to be more ‘frugal’ in future”.

[2]  On 26 May 2020, the European Commission (EC) set up its exceptional European recovery plan based on the full potential of the EU budget estimated over the next 7 years.

[3] Boris Johnson’s plans favour a “Singapore-tax-free zone” in Belfast, and the possible creation of ‘free ports’ ports on the East coast of the UK in Peterhead, Teesside and Aberdeen, where imports would no longer be subject to taxes or tariffs.

[4]  https://treaties.un.org/pages/ViewDetails.aspx?src=TREATY&mtdsg_no=XXVI-4&chapter=26