Lisbon - Summit for nothing?
* European Union
-N Portugal, it was enough to avoid controversy: Cutb the mad cow crisis, continue to skirt around the difficult problem of European tax and keep up the pressure on "reform of the labour market". The two "social" summits ("against precariousness and exclusion") in Portugal were to be of a modest character.
Apart from the problems of power and preeminence among member-states, the reason was that no advance seemed possible in the morose climate of winter 1999, marked by the exacerbation of relations between Great Britain on the one hand and France and Germany around the mad cow affair; acrimonious discussions between the "tax havens" (Great Britain, Luxembourg) and the others who demanded a uniform taxation throughout the EU on the capital incomes of "foreign" residents. In October 1999 the behind the scenes establishment of a "new" BlairAznar axis, on the basis of a document of orientation, irritated other member coun tries for at least four reasons:
1. Aznar, the Christian Democrat, was thus favored while his brother party in Austria had concocted an electoral/governmental alliance with a far right party whose leader is a notorious pro-Nazi;
2. Blair "the socialist" was not being very helpful to his Spanish brother party, in opposition, at a time when this latter was preparing to face Aznar in the parliamentary elections;
3. The brutally antisocial tone of the text annoyed more than one European social-democrat: apart from Jospin who did not like this explicit language, Schröder was seeking to mollify the trade union movement in the perspective of new national collective conventions:
4. And, the last straw, Blair makes no secret of his European ambitions, whereas in Great Britain he has just toned down his campaign for monetary union (the euro) for fear of the electoral consequences.
The disorder reached its height when it came to naming the new head of the IMF (a task traditionally attributed to the EU). Germany wished to use it to flaunt its "new" economic and financial power. For several weeks, Schröder confronted both Clinton and his main EU "partners", before just about winning the day.
12 International Viewpoint #322 June 2000
THE EU's Lisbon Summit
(March 23rd-24th, 2000) was programmed as a non-event. After the Berlin Summit, which had reinvigorated an ailing EU in spectacular fashion, it was to be in France in December 2000 that the intergovernmental Conferencel would be "concluded, in an authoritative and legitimate manner.
FRANCOIS VERCAMMEN*
In such a political climate, the EU machine seized up. It can seem bizarre that in an affair as colossal as the unification of the EU, the secondary can take precedence over the essential. It should never be forgotten that the EU is fundamentally a regroupment of (some big) imperialist states. Any "external" or "peripheral" element or event influences the relationship of forces between them and this weighs immediately on the big issues. Here also "details" count for something: the content first, but also the tactics to move forward, the intergovernmental alliances to win, the terminological formulations, the final result as the media present it, down to the individual position of each of these "powers that govern us".
### Political will
The situation has "miraculously" cleared up, for the political will produced by the war in Kosovo has linked up with the underlying tendency. It has been nourished by a number of elements. An element of cohesion which impacts favorably is the project of an autonomous defence. The EU is going forward, its main military institutions have been put on the rails. But also the French, German, Italian and above all British governments have resisted, up until now, the pressure from Bill Clinton, who wants to impose a new generation of American weapons on them, and thus block the commercial, indeed structural rapprochement of the European arms firms. The aim being to impose a "transatlantic" solution under the aegis of its own
"champions" (some of whom need strengthening).
But it is without doubt the evolution of the European economy which has been the determinant factor, on the conjunctural and structural level. Certainly, the weakness of the Euro in relation to the dollar constitutes a handicap, above all to its acceptance on the international scale as a reserve currency. But it has also favored European exports, notably towards the still expanding US market.
### Upturn
This has supported the upturn in Europe, at least provisionally. Budget surpluses in most European countries have furnished a good "nest egg". The governments (social democratic in the main) have been able to make concessions on the level of social expenditure, while continuing a structural neoliberal policy (privatisation, flexibilisation, deregulation). Thus, even the Blair government has made a "social turn" (health, education) a year ahead of parliamentary elections.
Secondly, there are changes in the structure of the economies. The movement of company mergers continues to beat all records in Europe (despite stinging setbacks: the aborted merger between the Deutsche Bank and the Dresner Bank). But above all the acquisition of the German Mannesmann by the British Vodafone AirTouch (creating thus a giant of global scale) has gone through without the German government intervening
A very symbolic Rubicon has been crossed, with the abandonment of intervention by states to protect their national champions. The shareholders (in other words the markets) have won out. "A fundamental turning point for European capitalism" 2 Other transnational (interEuropean) "mega-mergers" are underway and will follow in the sectors of energy, banks and insurance, telecommunications and distribution. Hence the necessity of disposing of masses of supplementary and cheap capital.
It was following the Davos Forum that EU summits have proceeded to tactical readjustment. This assembly of "global" capitalism was needed by the dominant classes to draw up a "balance sheet and
Prodi: In the line of fire? perspectives", after the political and moral defeat in Seattle. But the United States also came there to signal their hegemony (thus Clinton in his "State of the Union" speech: "The United States have never been as strong nor Americans so prosperous"). The favourable conjuncture in the USA, which continues still (even if its bases are dangerously volatile) has undoubtedly "convinced" the EU.
Thus, the US example, which does not seem to be running out of steam, and the economic upturn in Europe remobilized the European elites around the EU. Lisbon would become the "least controversial summit since 1997" (Amsterdam), according to Blair. From the beginning of February, the preparation of the summit (planned for the end of March) would take place in other conditions. In fact, the BlairAznar text of autumn 1999 came back on the table. It had meanwhile gained important support in Italy (Amato) and Germany. Jospin, harassed at home by the social movement, was going to sacrifice some ministers. But he was already prepared to impose on France a new neoliberal measure: it was in Lisbon, on the eve of the opening of the summit, that he accepted the privatization of services he had hitherto resisted. The EU could open a new offensive.
### Summing up
The Summit could be summed up easily:
1. Complete the single market at the financial level and move towards the "new economy" with, in the short term, the necessary practical measures (see following article).
2. For the immediate, nothing is decided on the social level, except to put in place the mechanisms of functioning which allow a decision in Paris (Nice) in December 2000.
The coherence between the two is simple: integration pushes the markets and "the intensification of competition will mean that, in one way or another, the European structural rigidities [the reference here is to social rights] will be broken. The reforms adopted in Lisbon will only be the beginning" 3
It is clear: the dismantling of the welfare state underway in each country will be coordinated, "Europeanized". This is not insignificant. And to win the social-democratic apparatus (trade union and political), this will be done in the name of "full employment via the new economy" 4
The preparatory meeting of the Ministers of Social Affairs, in February, had announced the theme: if it was still
"combating precariousness and social exclusion", the "modernization of social security" is now at the centre of the discourse around one of the key ideological notions of the "Third Way": the passage from the welfare state to the "active social state"
### Confused
The notion is intentionally confused. But its practical goal is very clear: to undermine the current system of social protection through some simple rules. Social benefits are no longer automatic and universal. They no longer amount to a right but to a payment which can be imposed by the state, under the threat of losing in part or in full the enjoyment of the benefit. They are no longer general, but rather linked to the individual.
At the same time, one of the bases of solidarity in the workplace is broken. The "active individuals" are in fact made scapegoats in the eyes of society and the world of work. Blair made himself famous and odious in taking on young single mothers, immediately following his electoral victory.
The goal is certainly to radically compress social expenditure, with the perspective of its (partial) privatization. All the benefits of the system of protection are in the line of fire: unemployment, family, retirement, and health. The case of pensions is a particularly lucrative one for financial capital. But the same is true for temporary work. All the EU governments have tried to apply these rules for some time. They figure regularly in the reports
European Union of the OECD and are evoked in the meetings of the councils of ministers (above all ECOFIN, the meeting of the Finance Ministers).
But there are obstacles because social security is the fruit of 100 years of workers' conquests, which has taken on, since 1945, a global, universal and normative character. It is the result of huge struggles, the crystallization of a relation of forces between capital and labour, incarnated in the workers' organizations and in a diffuse sentiment of social justice in the working class. It has its complexities and specificities, country by country (which makes the development of an alternative which is both European and concrete a difficult task for us).
Since 1998, the Commission has tried to launch a debate on European policy (in a Communication entitled "Modernizing and Improving the System of Social Protection"). But on this level also, things are not simple: social policy is not decided at a community level. It is the province of the national states, hence the councils of ministers where decisions are in general taken by unanimous vote.
While taking no concrete measures of any importance, the Lisbon Summit - the governments meeting together - took the political decision to grasp the bull by the horns in the short term. Two points of procedure should worry the workers' and trade union movement. First, a "High Level Group" (!) is charged with making "a study on the future evolution of social protection in a long-term perspective, with particular attention to the viability of pension arrangements". Then, in an analogy with the Councils of Ministers which follow the application of the Economic Policy Guidelines, "the European Council of Prime Ministers and heads of state will meet each year in spring to debate economic and social questions"
Curiously it is not the ministers of social affairs but those of the economy and finances (the famous ECOFIN) who will supervise this "social policy". Certainly, other ministers can contribute, but, according to the text, "there is no need for new processes". The goal is to cut short any questioning of the criteria for monetary union (the Maastricht treaty and the pact of stability). Moreover, the Commission will prepare a report of synthesis (a balance sheet, in other words) to submit to the bodies mentioned, and, a real innovation, there will be, as for the Maastricht criteria at the International Viewpoint #322 June 2000 13
IT'S the story of a cabal. Almost simultaneously the critiques mounted. "Brussels" is criticized, here and there, in the press of a number of member-countries. "Brussels" is the Commission, and the Commission is its president, Romano Prodi. The critiques were disparate. Either they were banal: "Prodi doesn't care for his relationship with the media; his spokesperson is confused; he is not firm enough in meetings with his
Commissioners, and so on". Or they do not hold water: "Prodi has no vision of the future of the EU. Prodi underestimates the enlargement towards the East. Prodi neglects his administration". These criticisms are absurd for what Prodi was doing had been laid out in his inaugural speech as president of the Commission. And what he said there, he had duly negotiated with those who had made him king: Blair, Schröder,
D'Alema, and Aznar. So, if all these arguments are derisory or false, but all come to the same conclusion, there must be a good (and solid) reason to get rid of Romano
Prodi. And there is, although it is unstated: the conflict of power between the
And this is focused on two people: Prodi, losing speed, and Javier Solana, whose stock is soaring. Behind this, there is the institutional architecture of the EU. The
Commission is essentially the guardian of the Treaties, above all the implementation of the Single Market. The European Central Bank looks after monetary union. The area covered by the European Court of Justice is obvious. For the rest, it is essentially the governments of the member-states under diverse appellations (European Council,
In this arrangement, there are some vacuums and some superpositions. But as to foreign policy and defense, it is clear: it is the domain of the governments, in exclusivity.
Except that there is no single spokesperson who is both representative and political
(for example a President of the EU elect/designated for a certain period). Several people could be tempted to fill this vacuum: the president of the Council of Ministers during the time when their country "presides" over the EU (the Finnish minister thus played a significant role in the final negotiations with Milosevic); the commissioner for external relations (who is a member of the Commission), as it happens the Briton,
Since the Berlin summit, and the political turn implemented there, this incoherence can no longer continue. A strong political instrument is needed, a personality directly linked to the Council, and not to the Commission. Thus a post of "High Representative of the EU for foreign policy and Security" was created. Solana was taken from NATO, where he had been secretary general. One of his main tasks - and a very delicate one - is the implementation of a common European defence policy, autonomous in relation
Having served as head of NATO will help him. At the same time he has also been named secretary general of the Western European Union (WEU), to neutralize this US-
European military remnant. And, something which is rarely pointed out, he is also the secretary general of the Council of Ministers (that is to say of the member-states), which concentrates the essential aspects of EU legislative, executive and constitutional power in his hands. To this end, Solana disposes of an administrative apparatus pro-
Solana works hard, efficiently and skillfully. On the military level, two committees of high-ranking officers, and another of diplomats, have been set up in the service of the
European council. As for foreign policy, he delivered a sensational report (co-signed with Patten) on the weakness of EU activity in Kosovo to the Lisbon summit. This allowed it to begin to address this weakness through an unambiguous resolution adopted at the summit. This is only a beginning. There will certainly be an internal renegotiation, for the Commission currently manages trade policy (external) and multiple programmes of an aid and humanitarian nature (which involves around a hundred delega-
The cabal against Prodi has sent a message to the Commission that it is and remains a body subordinate to the Council, which is in the hands of the Franco-German-British troika. The Summit in France, at the end of December 2000 will confirm this reshap-
* European Union time, "[definition] of specific calendars for realizing the short, medium and long term objectives"; :[establishment] of quantitative and qualitative indicators and criteria of evaluation in relation to the best world performances" ; "[translation of] these European directives into national and regional policies by fixing specific objectives", and "an evaluation and examination" or a strong constraint on every EU government.
In fact, these decisions fit in perfectly with the logic and the norms established by the EU. The chapter on employment in the Amsterdam treaty declares already that "the objective is a high level of employment", but this will be done "in a manner compatible with the GOPE". These are based on "an enlargement of the scale of salaries downwards [with] a reduction by 20% to 30% of the wage costs of semi-skilled activities". This implies "an equivalent reduction of unemployment benefits and of social payments" 5
20 million jobs
The European council promises to "bring the rate of employment [currently 61% on average] to a level as close as possible to 70% between now and 2010. And to do so in such a way that the proportion of women active [currently 51% on average] rises above 60% between now and 2010". According to the calculations, this would mean 20 million jobs to create!
This "promise" irresistibly recalls the "predictions" of the Ceccaldi report of the 1980s (3 to 5 million jobs to be created by the implementation of the Single Market) and the 15 million jobs evoked in Jacques
Delors' White Book, reduced, in the course of things, to "the reduction by half of unemployment" before 2000 (of which
Kohl was for a while the champion).
Today, the talk is no longer of full time jobs, with open term contracts, a full wage and in accordance with legal social norms and recognized rights. These are jobs in the
US style, produced from the "new economy"!
The first thing to expect, linked to this transfiguration of the notion of "a job", would be the reorganization of the statistical apparatus: what is a job? Who is unemployed? For example: in the USA, to be counted as unemployed, people have to prove that they are actively seeking work in the week preceding the survey; 2 hours of work a week is enough to be left out of
14 International Viewpoint #322 June 2000
Prodi in the line of fire?
Commission and the European Council, that is the (big) member-states.
Councils of Ministers).
Chris Patten, or the president of the Commission themselves, currently Prodi.
to the United States.
vided by the Council of Ministers.
tions and missions around the world). A good part of the EU budget!
ing of power in the EU.*
the statistics! If (as is already done in several EU countries) you exclude from the statistics all those undergoing training and all those who have not accepted a job or training "offered", the road to "full employment" is open!
The implementation of *the active social state" perfectly frames with the real objective of the EU: "to reform the labour market" by getting rid of alleged "structural rigidities". This objective is in its turn linked to the new strategic objective, to engage in competitive battle in the world arena. This carries with it a mortal threat to the cohesion of the world of work in Europe. It is this which is now on the agenda and which will become a political priority for the EU. Already in part applied in all the member countries, it will have the force of an "intergovernmental coordination". The policy of full employment seeks to exploit to the maximum the whole workforce available to society, notably women and the old. That necessitates a thoroughgoing upheaval to respond to the new technologies. But this insistence on a modern training seeks also to conquer a base within society among the young, fascinated by the "American" cultural model (mobile phone, computer, video, CD, DVD).
Since the 1980s the employers (and the media who serve them) have already exploited the inter-generational conflict. They needed a young workforce, more energetic and more malleable. It was necessary to obtain the departure of the old generation without threatening social peace. The system of early retirement was the response, but it was too partial and, above all, too costly. Since then, there has been the ideological bombardment around the "demographic time bomb" (the opposite of the situation in the South) which rendered the pensions by allocation "unpayable". The old generation was thus accused of "egoism" and "corporatism". The same argument was used about wages: their growth would stop the creation of jobs, indeed lead to their suppression, to lay-offs. But from the employers' point of view, all that was "too little too late": for they came up against a class of older workers in the workplaces who also constituted the spinal column of the trade union movement and the resistance.
With the massive introduction of new machinery, "the cleansing" of the labour market could be done more rapidly, and cheaply; the progressive and gradual process of deregulation underwent a sharp acceleration. The ideologues of the bourgeoisie explained that the whole younger generation would gain; those who wanted it would have a "modern" training; each according to his capacities would find a job (certainly not in immediately perfect conditions, but all the same a job) and the most "dynamic" could make some cash. The new "heroes" of the market and the "cyber-economy" prove it.
### Increasing inequality
On several levels, the conditions employees work under have seriously deteriorated. The whole neoliberal policy increases inequalities inside the world of work. In several countries, permanent contracts are in the minority compared to temporary and part-time contracts: what was still atypical at the beginning of the 1990s has become the rule. The social laws are blithely "avoided" or else ridiculed (for example contracts of employment for a half-hour repeated over and over again!). Despite the economic upturn, the bosses continue to rein in wages. This restrictive policy becomes an argument to enlarge the system of bonuses linked to company profits and encourages save-as-you-earn schemes or worker shareholdings. Beside the division between foreigner and native, men and women, different strata of income, of social insertion, qualification, social-cultural behavior increasingly divide the world of work, in addition to a growing individualization. Tax policy plays in this aspect a very negative role. The "companies" of the "new economy" condense and reinforce the torments of this social jungle.
Social democracy is euphoric since Lisbon: "full employment is back, the economy is on the move". A new social consensus is being drawn up where the summits of the trade union bureaucracy will do their part of the job. Resistance will continue. But it will be necessary to take the measure of the new breadth of the neoliberal offensive, its popular echo and its structural impact in the workplace. * I. The Intergovernmental Conference deals with reform of institutions, enlargement towards the east and the definitive creation of an autonomous defence. 2. Editorial, Financial Times, February 5th 2000. 3. Financial Times, March 25th 2000. 4. A third aim is to return Prodi and "his" Commission to a subordinate position in relation to the Council of Ministers, with Solana at the head of the EU. See box. 5. Commission Communication "European Growth and 6. Published in 1993 under the title "Growth, Competitivity and Jobs".