SCAEF Bulletin

January 2009

 

The EU did not cause the current economic crisis.  But it has certainly worsened it - and could make it very much worse still.

A founding principal of the EU is that the market should be supreme and that state intervention should be kept to the minimum.

Over the past decade this has meant pushing public debt, politically negotiated and controlled by the state, into the private sector - where it became a source of great profit to financial institutions that could borrow cheap in wholesale money markets.

This was so for pensions – with steady pressure on governments under the Lisbon programme to promote private sector pensions.

It was so for the rush to privatisation and the private finance initiative – driven by the EU’s Growth and Stability Pact limits on public spending.

It was certainly so for the unsustainable housing boom in countries like Britain, Spain and Ireland – a direct consequence of the ending of public sector housing.

All this undoubtedly worsened the intensity of the financial crisis which erupted when the banks could no longer fund the private sector debt. 

It also ensured that the crisis was worst in Britain where such neo-liberal measures have been taken furthest – and where the freeing of capital movement has been most far-reaching.

Recession is today morphing into longer-term depression. What can stop it ?  Certainly not the market.  Only public intervention will rescue employment and living standards.

Only public sector house building can save the construction industry.  Only careful strategic government support can save what is left of manufacturing.  Only an expansion of public services can maintain purchasing power.

But all such actions are in direct contravention of EU market and competition rules.  The European Central Bank has already made it clear it opposes any significant Keynesian-type fiscal stimulus – and over most of Europe it has the power to enforce it. 

This is why the current battle over the Lisbon Treaty is not past history, of no importance to the trade union and labour movement, but absolutely central if we want to avoid further economic disasters and start to manage our economy democratically.

The Lisbon Treaty would conclusively deprive us of that democratic right.  Every support should be given to the Irish people in their rejection of the Treaty. We should demand the same of our own government. 

First Lead

IRISH TOLD: REVERSE ‘NO’ TO LISBON TREATY

 

EU instructs Ireland to hold second referendum

 

 

The Irish people will be required to vote in a second referendum on the Lisbon Treaty before 31 October 2009.  This was the decision of the EU Council at the Paris summit on 12 December 2008.

 

The Irish rejected the Lisbon Treaty in the first referendum held on 12 June 2008.  The voting was decisive: 53 per cent to 46 per cent.

Council will ‘take note’

In the communiqué issued after the 12 December summit the EU Council committed itself to ‘take note of the concerns of the Irish people as set out by the Irish Taoiseach in Appendix 1’. This appendix was based on a survey undertaken by the Irish government and demonstrates, contrary to claims by the pro-Lisbon lobby, that the NO vote was founded a very firm understanding of the issues.

These are listed as concerns that the treaty gave the EU power to interfere in tax policy, that it would compromise Irish neutrality, that it would undermine public service provision in health and education and that Treaty’s overriding commitment to free market principles provided the legal basis for restricting trade union rights.

No revision of text

Under the terms of the communiqué there will be no revision of the text of the treaty.

 

Instead the communiqué states that the Council will give ‘legal guarantees’ on the three issues: that there will be no changes in tax policy without the approval of the Irish government; that the treaty will have no implications for Ireland’s traditional policy of neutrality and that the rights set out in the EU constitution would no be used in any way contrary to the rights to ‘life, education and family’ set out in the Irish Constitution.  In addition, every member state will continue to have the right to a national as a member of the EU Commission.

 There is, however, no ‘legal guarantee’ on workers rights.  There is simply a statement that ‘the high importance which the Council attaches to questions mentioned in Appendix 1 concerning the rights of workers will be confirmed’.           

There is also a preliminary sentence that could be used to minimise any obligations.  ‘The concerns expressed [in Appendix 1] will be treated in a satisfactory manner as regards Ireland and the other member states’.  In other words, the concerns of the Irish people will have to be balanced against those of other states – none of which were given the opportunity of a referendum.

“Guarantees are worthless”

 

Frank Keoghan, Secretary of the Irish People’s Movement, commented that the ‘guarantees are worthless. The EU is rapidly moving towards a post democratic stage’.  Leader of the Irish Labour Party, Eamon Gilmore, expressed his concern at the vagueness of commitments on workers rights and sought greater clarification.

The Paris Summit set a timetable for the full and final implementation of the Treaty for 1 January 2010.  There had originally been pressure for the Irish to vote before the EU elections in June.  This was opposed by the Irish government on the grounds that it would take longer to create a climate of opinion in favour of the Treaty.

Treaty ‘exacerbates attacks on trade union rights’

Britain’s TUC in September passed a resolution calling for continued campaigning against the Lisbon Treaty and expressing its concern ‘that the Treaty would exacerbate attacks on trade union rights by handing the misnamed EU court huge new powers in order to act like a supreme court’.

In October Secretary of the ETUC, John Monks, has stressed his great concern at the imbalance between fundamental rights and ‘the freedoms of the single market’ as indicated by recent ECJ decisions limiting the right to strike.  He called for a new ‘social progress’ protocol to be included in future treaties. 

Need for “social progress” protocol now

Brian Denny, Convener of Trade Unionists against the EU Constitution, argues that the situation is too urgent to wait for a new treaty in five or six years time and such a ‘social progress’ protocol must be attached to the Lisbon Treaty.  He urges that trade unionists in Britain to take this proposal forward to the TUC in September.

 

 

 

 

 

 

 

 

 

 

 

Second Lead

EU Central Bank President defends tough monetary policy

 

 

In an interview with the Financial Times on 18 December EU Central Bank President Jean Claude Trichet defended the maintenance of interest rates at a higher level than those in Britain and the US and its tough controls on government borrowing.

 

“We would destroy confidence if we tampered with the Growth and Stability Pact”.  This pact limits annual government borrowing in member states to 3 per cent of GDP.

 

Trichet attacked the ‘reckless policy’ of the US Federal Reserve and said the economic situation was now ‘very, very grave’.  The rules of the ECB effectively commit it to using increased unemployment as the main lever to restore profits in economic crises.

Local Tesco, Asda, Morrison, Lidl and Aldi are places where you will meet a lot of people and workers. The Banking crisis and employment was top of the subjects raised. A lot of people are concerned about, to use our Prime Ministers words, 'British Jobs for British Workers'.

 

As far as the Banking crisis the British sense of humour still prevails. Remarks like 'what is Tesco's response to the Banking crisis?' Answer 'All relief cashiers to the check outs.'  Or what is the collective name for a number of Bankers? Answer: A Wunch. I swear that I saw this one in a proposed EEC Directive. However there is more worrying questions when people refer to the problems of unemployment created by the crisis.

 

Questions like ' My sons work in the building trade and they can't get a job for Polish or other foreign workers.' 'What about a points system for them and us?'.  When you advise that the point system only applies to workers from outwith the EU, the response you get is that ' its not fair.' The people who are raising these issues are decent Scottish/ UK citizens, which the BNP and others will feed.  What is lacking is a response from Labour to this. Where are the politicians that could really rise to this challenge?

 

In 1906 the Parliamentary Labour Party was formed. 29 members they consisted of Miners, Railway workers, Building Tradesmen, Printers and a couple of 'intellectuals'.  They were drawn from the ranks of trade unionists, people who had experienced real life and had the vision and will to change the society they lived in. Over the years, under the influence of the Westminster club, some drifted away but, until recent time, the majority wished to continue that vision of a better society. In this they received ground rooted support from ordinary hard working families. Such support was reflected in the votes for Labour. In 1983 Labour fought the election on an Alternative Economic Strategy. This included ensuring the banks were made more accountable to the people and democrats for their actions. Over 8 million citizens of the UK voted for the AES, more than voted for New Labour in the last election. It was called the longest suicide note in history. But it has been proven right.

 

The last 11 years of New Labour could properly be described as the longest suicide note for a political party in history. New Labour's' reliance on the rich and wealthy, on private debt, rather than good collective prudence has resulted in the chaos that now surrounds the people and the confusion among their previous reliable supporters.

 

Senior Labour Politicians lunches with the very rich in our society. They lecture the rest of us on openness and transparency, yet they dine in a club, that has a code, which ensures that anything said within the club remains within the Club. This is why there was such a fallout from the Labour proposed Commissioner Mandelson, the wealthy Nathanial Rothschild and the Tory George Osborne affair. The Club which met in a villa and a Russian billionaire’s yacht.

 

When Farepak’s owners went bust the poor folk who relied on it at Xmas for their kids and families received nothing from  the government whilst banks receive billions. The dispossessed people of the Chagos Islands in the Indian Ocean, thrown out of their home by the UK government, await the outcome of the Law Lords on whether they can return to their home, which flies the Union Jack and serves as a US base for the 'war on terror'. The injustice served to the poor, the dispossessed and those who did not have access to justice are the very people the 29 Labour MP's were sent to Westminster to serve. We have come a long way back to the return of that period.

 

This is not a rant against Labour but against a system which all the major parties in Britain and Scotland support: a free market that is based on capital’s greed rather than peoples need.