Consortium News, The Euro-Establishment’s Fear of Populism

Yellow Vests, Italian Budget Battles & Silent Labor Unions

 

"While organized labor restrains itself, both right- and left-wing populists take the helm on EU on economic issues, many claiming they are not anti-European as such, but merely determined to stop the austerity policies that have done so much harm to the population."

Excerpts:

"Since mid-September, the European Commission, the EU’s executive body, has been battling with Italy over its budget. The populist government in Rome—led by the Five-Star Movement, orM5S, and the League—have decided to stimulate the economy by giving money to the poor, lowering taxes and increasing public investment.

With an assist from financial markets that are penalizing Italian government bonds, the Commission has been threatening an “excessive deficit procedure” if Italy doesn’t reduce spending and resume measures to balance its budget. In theory this austerity policy will make the country more stable and efficient. But the last 10 years have demonstrated that cutting the budget and raising taxes have depressed economic activity, with the effect of making people poorer. Italy’s new political leaders are determined to show they can break through the resistance to public stimulus of the economy.

The French Yellow Vest protests came just in time to alleviate some of the pressure on the Italians, allowing the M5S and League leaders to point out the hypocrisy of letting France run a budget deficit of over 3 percent while pushing Italy to go below 1.5 percent. “If the deficit/GDP rules apply to Italy, I expect they should apply to Macron as well,” Italian Deputy Prime Minister Luigi Di Maio said on Dec. 11, Reuters .

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Where are the unions?

In France, union membership is very low, but the unions there still have considerable power in collective bargaining and have demonstrated the ability to paralyze the country, at times more so than in Italy, where membership is much higher.  France’s unions, however, do not seem to be identifying in any major way with the discontent, although there have been some sightings. The SocialistWorker.org reports that “France’s biggest union coalition, the General Confederation of Workers, called for a day of general mobilization on December 14, and in some regions, like Ile-de-France, this garnered support from other unions and federations.” 

But given the EU’s embrace of austerity policies and “labor flexibility”— meaning the ability to fire people more easily and keep wages low—organized labor isn’t taking the central position against the effects of globalization that might be expected. Unions have been mostly absent from the spontaneous protests in France and the rising populist movements in Italy and elsewhere around Europe.

Protecting Institutions

The dilemma for some unions is that while they aim to defend workers by battling wage and benefit cuts that are justified by the need to compete on global markets they fear feeding populist movements that might challenge the legitimacy of European institutions and the politicians who back them.

An example of this contradiction comes from Italian labor leader Susanna Camusso, head of the Italian General Confederation of Labour, or CGIL, the country’s largest union, dating to 1906.

In an interview with foreign journalists in Milan on Nov. 19, Camusso focused on unstable working conditions that force workers to accept multiple short-term contracts that offer no job security. She also raised some broad demographic inequities; between young and old, men and women, and different geographic areas.

But when asked if organized labor was wrong to have supported the EU economic policies from the start—by not opposing the budget rules at the root of current demands for spending cuts—Camusso denied any culpability. “We are pro-European and continue to be convinced supporters of Europe,” she said. “Our country made sacrifices affecting workers, but joining the monetary union and the Euro was the right choice. Not only because we are a founding country, but because Europe has meant peace for many years.”"

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