The Battle for Europe

Thomas Fazi

Description

The Battle for Europe brings into sharp focus the historical importance of the current Eurozone crisis. Thomas Fazi argues that European Union (EU) elites have seized on the financial crash to push through damaging neoliberal policies, undermining social cohesion and vital public services.



Drawing on a wealth of sources, Fazi argues that the EU's austerity policies are not simply a case of political and ideological short-sightedness, but part of a long-term project by elites to remove the last remnants of the welfare state and complete the neoliberal project.



As well as an urgent critique of the EU and monetary union as currently constituted, The Battle for Europe showcases a programme for progressive reform and outlines how citizens and workers of Europe can radically overhaul EU institutions.
List of Figures and Tables

Preface

1. The Financial Crisis

2. The Coup

3. The Real Causes of the Euro Crisis

4. From Economic Crisis to Economic Shock

5. Brave New Europe

6. Another Europe Is Possible!

Notes

Index

Sujets

• Political Science
• Political economy
• European Union

Informations

• Publié par: Pluto Press
• Date de parution: 20 février 2014
• Nombre de lectures: 0
• EAN13: 9781783710232
• Langue: English

Extrait

THE BATTLE FOR EUROPE
The Battle for Europe
How an Elite Hijacked a Continent – and How We Can Take it Back
Thomas Fazi
First published 2014 by Pluto Press
345 Archway Road, London N6 5AA
www.plutobooks.com
Distributed in the United States of America exclusively by
Palgrave Macmillan, a division of St. Martin’s Press LLC,
175 Fifth Avenue, New York, NY 10010
Copyright © Thomas Fazi 2014
The right of Thomas Fazi to be identified as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
ISBN 978 0 7453 3451 6 Hardback
ISBN 978 0 7453 3450 9 Paperback
ISBN 978 1 7837 1022 5 PDF eBook
ISBN 978 1 7837 1024 9 Kindle eBook
ISBN 978 1 7837 1023 2 EPUB eBook
Library of Congress Cataloging in Publication Data applied for
This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. Logging, pulping and manufacturing processes are expected to conform to the environmental standards of the country of origin.
10 9 8 7 6 5 4 3 2 1
Typeset by Curran Publishing Services, Norwich
Simultaneously printed digitally by CPI Antony Rowe, Chippenham, UK and Edwards Bros in the United States of America
Contents
List of figures and tables
Preface
1 The Financial Crisis
2 The Coup
3 The Real Causes of the Euro Crisis
4 From Economic Crisis to Economic Shock
5 Brave New Europe
6 Another Europe is Possible!
Notes
Index
Figures and tables
Figures
1.1 The widening wages–productivity gap in the European Union from 1970 onwards
1.2 Top income tax rates in the European Union and European Monetary Union, 1995–2013
1.3 Top corporate tax rates in the European Union and European Monetary Union, 1995–2013
1.4 Share of pre-tax income of the richest 1 per cent of the population in selected OECD countries, 1970–early 2000s
1.5 Share of pre-tax income of the richest 1 per cent of individuals in the United States, 1913–2008
2.1 Greece’s deficit-to-GDP and debt-to-GDP ratios, 1995–2009
2.2 Ireland’s deficit-to-GDP and debt-to-GDP ratios, 1995–2010
2.3 Greece’s unemployment and GDP growth rates, 2009–11
2.4 Portugal’s long-term (ten-year) government bond interest rate, 2009 to mid-2011
2.5 Private and government debt in Spain as a percentage of total debt, 2000 and 2008
2.6 Spain’s deficit-to-GDP and debt-to-GDP ratios, 1995–2012
3.1 EMU average deficit-to-GDP and debt-to-GDP ratios, 1995–2013
3.2 PIIGS debt-to-GDP ratio, 1995–2013
3.3 Debt-to-GDP ratio of G20 advanced countries, 1940–2011
3.4 Current account balance of Germany and PIIGS countries, 1999–2009
3.5 Greek arms imports, 2002–11
3.6 Countries most exposed to Greek debt (in US$ billion), mid-2010 and mid-2012
3.7 Composition of Greek public debt, end of 2012
3.8 Deficit-to-GDP ratio of the EMU, the United States, the United Kingdom and Japan, 1999–2013
3.9 Debt-to-GDP ratio of the EMU, the United States, the United Kingdom and Japan, 1999–2013
4.1 EU and EMU unemployment rates, 2000–13
4.2 Greece’s unemployment rates, 2000–13
4.3 Spain’s unemployment rates, 2000–13
4.4 Italy’s unemployment rates, 2000–13
4.5 Ireland’s unemployment rates, 2000–13
4.6 EMU GDP growth rate, 2007–13 (percentage change over the previous quarter)
4.7 EMU debt-to-GDP ratio, 2007–13
4.8 Greece’s annual growth rate and debt-to-GDP ratio, 2007–13
4.9 Spain’s quarter-on-quarter growth rate and debt-to-GDP ratio, 2007–13
4.10 Portugal’s quarter-on-quarter growth rate and debt-to-GDP ratio, 2007–13
4.11 Italy’s quarter-on-quarter growth rate and debt-to-GDP ratio, 2007–13
4.12 Ireland’s quarter-on-quarter growth rate and debt-to-GDP ratio, 2007–13
4.13 Development of the average standard VAT rate in the European Union, 2000–13
Tables
1.1 US Federal Reserve loans to financial institutions, 2007–10
3.1 Tax evasion and public finances
4.1 Average EMU government annual primary balance as a percentage of GDP (excluding interest payments)
4.2 Periphery countries: government annual primary balance as a percentage of GDP (excluding interest payments)
4.3 Average EMU government annual budget balance as a percentage of GDP (including interest payments)
4.4 EMU: primary balance versus budget balance as a percentage of GDP (2012 data)
4.5 Periphery countries: government annual budget balance as a percentage of GDP (including interest payments)
4.6 Periphery countries: primary balance versus budget balance as a percentage of GDP (2012 data)
4.7 Yearly average interest expenditure of the PIIGS, 2010–13
4.8 Total EMU government debt, 2009–13 (in € billion and as a percentage of GDP)
4.9 Periphery countries: government debt (in € billion and as a percentage of GDP)
4.10 EMU: implicit taxes on labour as a percentage of earnings
4.11 EMU: taxes on labour as a percentage of GDP
4.12 EMU: taxes on labour as a percentage of total taxation
4.13 Periphery countries: implicit taxes on labour as a percentage of earnings
4.14 Periphery countries: taxes on labour as a percentage of GDP
4.15 Periphery countries: taxes on labour as a percentage of total taxation
4.16 Periphery countries: change in VAT rate 2007–13
4.17 Development of top income tax rate and taxes on labour in the EMU and the PIIGS, 1995–2011
4.18 Implicit taxes on capital in the EMU and the PIIGS as a percentage of earnings
4.19 Taxes on capital in the EMU and the PIIGS as a percentage of GDP
4.20 Taxes on capital in the EMU and the PIIGS as a percentage of total taxation
4.21 Development of taxation on capital and labour, EMU and the PIIGS, 2007–11
4.22 Development of the top corporate tax rate in the EMU, 1995–2013
4.23 Development of the top corporate tax rate in the PIIGS, 1995–2013
4.24 Development of wages in the PIIGS, 2009–12
5.1 Banking sector assets-to-GDP ratio in the European Union, United States and Japan, 2010
5.2 Growth of the EU banking sector relative to GDP, 2001–11
The motivation that underlay the Resistance was outrage. We, the veterans of the Resistance movements … call on the younger generations to revive and carry forward the tradition of the Resistance and its ideas. We say to you: take over, keep going, get angry!
Stéphane Hessel (1917–2013), former Resistance fighter *

* from Time for Outrage! trans. Damion Searls, London: Quartet Books, 2011, p. 16.
Preface
‘Crisis’ has been one of the most-used words in the English language – if not the most used – in the five years from 2008 to the time of writing this book in 2013. Ever since the financial crash of 2008 – and of course the outbreak of the so-called ‘euro crisis’ in 2010 – ‘the crisis’ has been blamed for an almost endless variety of social and economic ills: unemployment, poverty, recession, public debt, political instability, social strife and in more recent years, austerity.
In this age of Tweet-like, lightning-fast, bite-sized information, phrases like ‘ the crisis eases up’ or ‘ the crisis intensifies’ – rather than, say, the more accurate but also more cumbersome ‘ policy makers fail to develop adequate tools to restore the flow of credit to private businesses and boost employment’ – have become commonplace. This is perhaps inevitable. In the months and years following the crash, though, this involuntary reification, or personification, of ‘the crisis’ ended up lending to it an almost god-like will of its own, and a force majeure -like sense of inevitability. The idea that the financial crisis of 2008 and subsequent First World recession, albeit triggered by the greediness of a few Wall Street bankers, actually reflected a deeper structural – economic, ecological, cultural, even spiritual – and thus inevitable – crisis, slowly sank into our collective consciousness.
There is certainly a lot of truth in this, and systemic, interdisciplinary critiques of our current socio-economic model are more needed now than ever. But the notion that the financial and economic crisis was the quasi-natural, end-of-history-style outcome of an unsustainable system – if not even the beginning of the ‘final crisis’ of capitalism – rather than a more mundane failure of policy making, overwhelmingly resulted in the opposite of radical critique: it resulted in complacency.
Like many (not all, of course) young radicals and environmentalists of my generation – I was 26 at the time of the subprime crisis – I too saw the crisis and subsequent recession as the necessary, albeit painful, slow-down and scale-down of Western consumerist turbo-capitalism that we had been advocating for so long. In a perversely naïve way, I believed that the system would self-correct itself, giving way to a better, fairer, greener world – not unlike what had happened in the United States after the Great Depression, and in Europe after the Second World War. As we all know, the exact opposite has happened, with Europe now facing its worst human, social and political crisis since the 1940s.
The left, I believe, bears a large responsibility. By contributing to the depoliticisation of ‘the crisis’, it has ingenuously helped the political-financial elites to transform it into a powerful ideology, in the Marxist sense of the word – a mystification of reality which ensures the continuous dominance of the ruling class, and one which came precisely at a time when the previous ideology of ‘permanent war on terror’ was starting to run out of steam – and to present the policy choices made since 2008 as neutral, structurally determined, inevitable (‘there is no alternative’) by-products of ‘the crisis’, rather than class-based, politically and ideologically motivated decisions.
I slowly and belatedly started to become aware of this after the outbreak of the so-called ‘euro crisis’, as I saw the blame for the crisis being shifted from the banks to the governments – and t