Andy Storey (Attac Ireland) / Working Group “Economic Governance”

A spectre is haunting Europe: the spectre of competitiveness. Our leaders regularly tell us (and will again urge us at the December EU Summit) that we must work harder and longer, and for less pay, in order to be more ‘competitive’. We must reduce or give up our hard earned social protections – pensions, unemployment benefits and other aspects of ‘Social Europe’ – in order to be more ‘competitive’. We must be more ‘flexible’, which means we must sacrifice job security for ever more precarious and demanding work practices – in order to be more ‘competitive’. Governments must observe ‘fiscal discipline’, rather than stimulate economies out of recession, because such discipline makes us more ‘competitive’. Peripheral European countries must surrender their sovereignty to the ‘troika’ in order to ‘regain competitiveness’. We must sign free trade deals, such as the Transatlantic Trade and Investment Partnership with the US, because that will make us more ‘competitive’. We must not ‘over-regulate’ the financial sector, or impose ‘excessive’ environmental restrictions on business, because to do so would be to make us less ‘competitive’.

The competitiveness dogma will not solve the current Eurozone crisis as it is downward pressure on wages (and, therefore, consumer demand) and on government spending that has locked European economies into spirals of decline. More fundamentally, this discourse is really about boosting corporate profits at the expense of the welfare of the mass of the European populations and at the expense of the environment. We have the option of distributing work and income more fairly so that everyone has access to a decent wage and fulfilling work, as well as high quality public services, but to do so requires that we redistribute income away from financial capital and corporate profits more generally – and towards the mass of the population, towards public services and towards environmental protection.

The true agenda behind this talk of ‘competitiveness’ will be evident at the European Council meeting on 19 December, which will debate a proposed new Competitiveness Pact. To help draft this Pact, German Chancellor Merkel invited French President Hollande and Commission chief Barroso to a meeting in Berlin in March 2013 with fifteen members of the European Roundtable of Industrialists (ERT), all of them chief executive officers of large corporations – two of whom were asked to chair a ‘working group on competitiveness’. The report of that group called for, amongst other things, reduced taxation, a roll-back of (limited) bank regulation, further erosion of labour protections, the streamlined facilitation of mergers and acquisitions, and privatization. As Corporate Europe Observatory has put it, “the demands of the ERT appear to amount to nothing less than putting the European Union entirely at the service of corporations”.

The Competitiveness Pact, if adopted, would constitute another contractual arrangement between Member States and the Commission – a form of ‘troika for all’ – that will see the further weakening of national labour laws, downward pressure on wages and more ERT-style ‘business-friendly’ regulation (or the lack of it). This last element will increase the likelihood of another economic crisis erupting in the future – to avert such a crisis we need more, not less, regulation, especially of the financial sector. The Pact will also feature yet more intrusive mandatory rules on the economic policies of Member States, building on the Fiscal Treaty and related measures that serve to reduce democratic control over vital areas of economic governance. (While the agenda of competitiveness is being pushed through EU Summits, Treaties and Pacts, it is with the complicity of member state governments, who can conveniently blame Brussels and claim that there is no alternative to the agenda coming from the European institutions).

The Competitiveness Pact must be rejected for three main reasons. First, it will deepen the European economic crisis by further depressing domestic demand and government spending at a time when stimulus measures are desperately needed for recovery. Second, it will drive another nail into the coffin of European democracy by taking still more economic policy tools out of the hands of national governments and transferring them to unelected technocrats. Thirdly, in line with the aggressive ‘competitiveness’ agenda long pursued, it will further degrade the conditions in which we Europeans live and work, forcing us to work longer hours for less pay in conditions of ever greater insecurity, while simultaneously cutting the public services on which we depend. This is being done in the name of ‘competitiveness’, but in reality it is about boosting corporate profits at the expense of ordinary people’s rights to decent lives.

If you oppose the Competitiveness Pact, seeing it as just one element of a long-running deification of claimed ‘competitiveness’, please sign this statement and join us in the fight for a decent life.

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