The EU must set limits to blind economic policies
Tomorrow, all 27 commissioners will sit together to adopt their proposal for the social dimension of the Economic and Monetary Union (EMU)… and we are deeply worried.
We are worried the Commissioners will not accept that necessary preventive and corrective measures are taken when economic policies go off-road and trigger alarming social consequences – such as widening inequalities (see OECD report), increasing poverty, skyrocketing unemployment rates, plummeting household income, or increasing youth unemployment.
Triggering action when these indicators exceed certain thresholds is a minimum requirement. We cannot accept to only have social indicators as a barometer, a mere witness to the negative impact of austerity measures. This is not acceptable for a genuine social dimension of the EMU. We don’t need a toothless kitten – we need a well-trained shepherd that not only puts economic policies under surveillance but can also ensure that they respect and support social development in the EU.
This is not a theoretical discussion and it should not be left to 27 people to decide. The social dimension of the EMU should be an appropriate tool responding to the reality check of the worrying social trends in Europe. For example one of the so called “performing states” at the beginning of the crisis – the Netherlands – now foresees in 2014 an increase in unemployment, a decrease in household income and a budget deficit despite billions of euros spared through budget savings made in the last years. The United Kingdom announced yesterday another round of cuts to welfare support, with the hope of having a budget surplus in 2020….
In addition to the reality check there is a duty check. There is a political requirement for each one of the representatives of the Commission to be a guardian of the Treaties. Article 9 states that "in defining and implementing its policies and activities, the Union shall take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against poverty and social exclusion, and a high level of education, training and protection of human health". That should be sufficient to give teeth to the social dimension of the EMU.
The unfortunate reality is that even if actions are triggered when social trends exceed certain thresholds we will still not achieve a true social dimension of the EMU. The supervisory mechanism is a necessary but not sufficient tool. We also need a strong social agenda (including at least a minimum income and minimum wage schemes, and universal access to services) to give direction to the EU and to clearly outline what our economy is for.
Lets engage!
Pierre Baussand
Director
