News
BackOn Tuesday, the EU Commission presented its “economic policy recommendations” to the Member States as part of the first so-called “European Semester”. The Member States are required to implement these “recommendations”, following the endorsement by the Heads of State and Government, within the next 12-18 months.
More than recommendations?
The so-called “European Semester” is the first stage of a fundamental reorientation of Europe’s economic policy. In future, the Member States will have to present their budget plans first to the Commission, which will assess them and make recommendations. At present the Commission is not yet equipped with any tools to penalise Member States that fail to comply with their recommendations. However, this is about to change. The European Parliament is currently in negations with the Commission and the Member States concerning a far-reaching legislative package, which should enable the Commission to impose hefty penalties.
Sheer ideology
AK and trade unions sharply criticise the ideological orientation of the economic and social policy recommendations of the Commission. They are formulated by technocrat experts in the apparatus of officialdom of the European Commission and predominantly orient themselves on the neoliberal textbook. A democratic debate is not taking place; deviating views are not being considered. The widespread publication of the findings of the Commission in the media generates political pressure to act, which presents Member States and social partners with a fait accompli. The true causes of the financial crisis and the budget problems of many Member States - 24 out of von 27 EU Members are not able to meet the Maastricht criteria - are not addressed: inadequate regulation of the financial markets, tax competition between the Member States, one-sided policy orientation in favour of transnational enterprises. If the EU has its way, its policy after the crisis will be the same as its policy before the crisis. For workers, austerity is the order of the day.
Recipes, which should have been mothballed ages ago: nothing has been learned from the crisis
Hence, the “recommendations” of the Commission do not come as a surprise, even though their scope in this form is unrivalled. For example, the Commission recommends that Spain put her regions on a tighter leach and Germany too has been asked to impose her national debt brake on the German federal states. The Spanish should also increase their Value Added Tax, as well as levies on electricity, gas and petrol and reduce the social security contributions of companies. The recommendation for Belgium is to reduce her unemployment benefit. France is supposed to ease her worker protection as allegedly employees with regular contracts of employment would enjoy too much protection. The French minimum wage was also too high and social security contributions would “penalise” companies. And of course, public services, being exposed to years of Commission ideology, do not get off scot-free: Germany, for instance, is supposed to liberalise her services sector and to create more competition with regard to rail transport.
Austria: reducing national debt faster
The Commission also has some “treats” in store for Austria. Hence, national debt should be reduced at double the speed decided by the government. The retirement age shall be increased, among others by reducing the number of people taking early retirement and by increasing the retirement age for women. High taxes and social security contributions for lower and medium incomes are also a thorn in the side of the Commission. However, anybody looking for criticism concerning the extremely low taxation of wealth as compared to European standards, will look in vain. According to the logic of the Commission, services such as transport or telecommunication in Austria should be liberalised even further.
On the road to confrontation
The economic and social policy recommendations of the Commission are the first chapter of a new era, a “quiet counter revolution”, as it has been described by the French daily newspaper “Libération”. They embody Europe’s capitulation before the so-called “logic of the financial markets“ in its pure form. So far, these recommendations are more or less on-binding. However, soon these “recommendations” will be supplemented by relevant penalty mechanisms. In the eyes of workers, the reputation of the historically important project ‘Europe’ will suffer a level of damage, whose extent cannot yet be estimated.
Background
The recommendations of the Commission are part of the economic policy coordination of the EU Member States within the scope of the European Semester. In April and May, the Member States had to present Stability and Convergence Programmes and National Reform Programmes in respect of which the Commission now gave the country-specific recommendations. The recommendations will now be discussed and officially adopted by the social affairs ministers, the finance ministers and the Heads of State and Government. The intention is to implement them within the next 12-18 months. Options to impose sanctions concerning the implementation are not yet available; however, they will soon be introduced as part of the economic governance package.
Appeal: Let's change Europe - MEPs warn against tightening the Stability Pact - Cross-party appeal for a social change of direction in Europe
Read the appeal here!
Further documents:
Country Specific Recommendations in the context of the European Semester - Frequently Asked Questions
Press release: Delivering on growth and jobs: Commission presents 2011 country-specific recommendations
Communication of the Commission - Concluding the first European Semester of economic policy coordination: Guidance for national policies in 2011-12
Recommendations for the 27 Member States
The so-called “European Semester” is the first stage of a fundamental reorientation of Europe’s economic policy. In future, the Member States will have to present their budget plans first to the Commission, which will assess them and make recommendations. At present the Commission is not yet equipped with any tools to penalise Member States that fail to comply with their recommendations. However, this is about to change. The European Parliament is currently in negations with the Commission and the Member States concerning a far-reaching legislative package, which should enable the Commission to impose hefty penalties.
Sheer ideology
AK and trade unions sharply criticise the ideological orientation of the economic and social policy recommendations of the Commission. They are formulated by technocrat experts in the apparatus of officialdom of the European Commission and predominantly orient themselves on the neoliberal textbook. A democratic debate is not taking place; deviating views are not being considered. The widespread publication of the findings of the Commission in the media generates political pressure to act, which presents Member States and social partners with a fait accompli. The true causes of the financial crisis and the budget problems of many Member States - 24 out of von 27 EU Members are not able to meet the Maastricht criteria - are not addressed: inadequate regulation of the financial markets, tax competition between the Member States, one-sided policy orientation in favour of transnational enterprises. If the EU has its way, its policy after the crisis will be the same as its policy before the crisis. For workers, austerity is the order of the day.
Recipes, which should have been mothballed ages ago: nothing has been learned from the crisis
Hence, the “recommendations” of the Commission do not come as a surprise, even though their scope in this form is unrivalled. For example, the Commission recommends that Spain put her regions on a tighter leach and Germany too has been asked to impose her national debt brake on the German federal states. The Spanish should also increase their Value Added Tax, as well as levies on electricity, gas and petrol and reduce the social security contributions of companies. The recommendation for Belgium is to reduce her unemployment benefit. France is supposed to ease her worker protection as allegedly employees with regular contracts of employment would enjoy too much protection. The French minimum wage was also too high and social security contributions would “penalise” companies. And of course, public services, being exposed to years of Commission ideology, do not get off scot-free: Germany, for instance, is supposed to liberalise her services sector and to create more competition with regard to rail transport.
Austria: reducing national debt faster
The Commission also has some “treats” in store for Austria. Hence, national debt should be reduced at double the speed decided by the government. The retirement age shall be increased, among others by reducing the number of people taking early retirement and by increasing the retirement age for women. High taxes and social security contributions for lower and medium incomes are also a thorn in the side of the Commission. However, anybody looking for criticism concerning the extremely low taxation of wealth as compared to European standards, will look in vain. According to the logic of the Commission, services such as transport or telecommunication in Austria should be liberalised even further.
On the road to confrontation
The economic and social policy recommendations of the Commission are the first chapter of a new era, a “quiet counter revolution”, as it has been described by the French daily newspaper “Libération”. They embody Europe’s capitulation before the so-called “logic of the financial markets“ in its pure form. So far, these recommendations are more or less on-binding. However, soon these “recommendations” will be supplemented by relevant penalty mechanisms. In the eyes of workers, the reputation of the historically important project ‘Europe’ will suffer a level of damage, whose extent cannot yet be estimated.
Background
The recommendations of the Commission are part of the economic policy coordination of the EU Member States within the scope of the European Semester. In April and May, the Member States had to present Stability and Convergence Programmes and National Reform Programmes in respect of which the Commission now gave the country-specific recommendations. The recommendations will now be discussed and officially adopted by the social affairs ministers, the finance ministers and the Heads of State and Government. The intention is to implement them within the next 12-18 months. Options to impose sanctions concerning the implementation are not yet available; however, they will soon be introduced as part of the economic governance package.
Appeal: Let's change Europe - MEPs warn against tightening the Stability Pact - Cross-party appeal for a social change of direction in Europe
Read the appeal here!
Further documents:
Country Specific Recommendations in the context of the European Semester - Frequently Asked Questions
Press release: Delivering on growth and jobs: Commission presents 2011 country-specific recommendations
Communication of the Commission - Concluding the first European Semester of economic policy coordination: Guidance for national policies in 2011-12
Recommendations for the 27 Member States