Friday, 21 October 2011

Indignant occupiers and the EU’s ‘sink or swim’ moment

The past few weeks have witnessed a remarkable coalescence between the months-old ‘Indignados’ movement that started in Spain and spread to other European capitals with the ‘Occupy Wall Street’ movement that started in New York and spread to other American cities. Coordinated demonstrations and unrest took place this weekend in from London and Paris to Brussels and Frankfurt.

I was in Italy on Saturday when Rome saw the worst of the violence outside Greece, and the news coverage was clearly unnerved in tone. Everyone is now wondering – where is this all going?

The protests on both sides of the Atlantic are expressing the same frustration: people feel powerless and confused by a North Atlantic economic crisis where solutions seem to be dictated by the all-powerful 'markets'. It's reminiscient of how the Pope in Rome excersised ultimate authority over kings and queens in midieval Europe. Now European and American leaders follow the dictates of 'the markets'. In 2008 following the Lehman Brothers collapse, the US congress was told that it must immediately pass a rescue package for the banks or 'the markets' would panic, causing economic catastrophe. Now European leaders are being told that they must immediately inject an enormous amount of cash into the struggling Southern European economies to prevent 'the markets' from panicing.

But who are these 'markets', and why do they seem to be the only thing calling the shots these days? In truth they are all of us: it is made up of the savings in our bank accounts, the money in our retirement funds, the value of our stocks. And we've become completely dependent on this system we've created. Experts aren't lying when they tell lawmakers on either side of the Atlantic that they must throw money at the problem in order to prevent economic collapse. The 'occupy' protestors seem to understand this. But what they are protesting is the system itself. For whatever reason, this public backlash didn't materialise back in 2008 (or it did so in the confused form of the Tea Party which seemed to be defending the system rather than challening it).

The demonstrations across Europe last weekend seem to have taken more inspiration from the Occupy movement than the Indignados, so much so that the Spanish may feel a little resentful that the New Yorkers have stolen their thunder. But in the end it’s natural for the two movements to coalesce. Both are essentially leftist, and both seem to be more about expressing outrage at the current situation than about demanding specific policy goals.

Of course the big difference between the indignados/occupiers in Europe and those in America is that in Europe there is no counterpart mob on the right. In America the situation is a bit more worrying, with the organized and politically powerful ‘Tea Party’ movement on the other side. Roving bands of angry mobs on both the far left and far right bring to mind uncomfortable historical parallels. At least in Europe, the far-right mobs have yet to materialize in significant number (though far right parties have been enjoying increasing political success).

The divergent ways in which different national medias have covered the occupy protests has been interesting. It's almost like the protests have become a Rorschach Test, with media seeing in them what they want. The French and German media started covering them very early on, even before they had spread beyond New York City. They very quickly identified them as being anti-capitalist in nature and made comparisons to the Arab Spring.

The US media on the other hand almost completely ignored the protests at first, and when they did begin covering them once they spread to other cities they focused on the 'carnival-like atmosphere' and the lack of a coherent message. It's possible that Europe, and France in particular, was more accustomed to these 'occupy'-type protests - there is a long tradition in France of workers 'occupying' factories as a form of protest (and they sometimes take management hostage, most recently in 2009). In the US, the media initially seemed confused by the 'occupy' tactics being used.

In the end it will not being the indignant or the occupying that will decide the fate of the European economy in the short term – that unenviable task will fall to European leaders over the next two weeks in what is being described as the EU's 'sink or swim' moment. But it is unclear what impact the growing unrest spreading across Europe will have on the European leaders’decision making in the coming days.

Euro crisis comes to a climax

European Union leaders are heading into a series of crucial meetings over the next week that could save or destroy the union. During the European debt crisis over the past two years many EU summits have been billed as “make or break,” but this is the real deal. Even the leaders themselves have acknowledged that they must come up with a final solution for the crisis before the G20 summit in Cannes on 3 November, or risk collapse of the European economy.

The crucial meetings begin today with an emergency meeting of Eurozone finance ministers, followed tomorrow morning by a meeting of all 27 EU finance ministers. Later tomorrow foreign ministers will meet to hammer out the last details before the big meeting, the summit of the 27 EU heads of government on Sunday.

Or at least that was the plan. But yesterday the offices of French President Nicolas Sarkozy and German Chancellor Angela Merkel said they would need more time after it became clear that the Eurozone's two biggest members will not be able to bridge their differences before then. So a second summit will be held on Wednesday - and that one will really be the last chance.  It's a worrying sign, especially considering that the summit had already been delayed from its original date earlier in the week. EU leaders are looking very Hamlet-esque, and this is rattling the markets.

The disagreement centers around how to structure the massive bail-out fund. Germany and the other rich Northern European countries want banks and other private investors to take steeper losses on their Greek bonds, but France and the European Central Bank have opposed this because they think it would destabilize the banking sector.  Additionally, France wants its own banks to be able to use the bail-out fund, but Germany says only the countries in economic meltdown should be able to do that.

What will happen during these meetings over the next days is anybody’s guess. EU leaders are all claiming they have a plan and that they are in agreement, but the incessant delays betray the truth. There are still severe disagreements. The EU Executive signalled it to had a plan earlier this month, when Commission President Jose Manuel Barroso unveiled a 5-point “roadmap for stability and growth”. But though the EU executive may desperately want to be relevant during this crucial moment, the fact is it is the member states who have both the power and the responsibility here.

How much the growing unrest on Europe's streets will effect member state decision-making is anybody's guess. Right now the goveernments of Germany and France seem more preoccupied with the disagreements between themselves than with the disagreement of the public at large. And as angry as people on the street may be, they are not proposing any tangible solution short of complete revolution, which the broad swathe of the population isn't ready for yet. But what would it take for that to change?

With even the editorial pages of The Independent now openly talking about an imminent period of revolution in the West, these are very uncertain times indeed.

1 comment:

Captain Kid said...

Welcome back!