By Frank Noakes and Catherine Brown
LONDON — 1992 marked the closing of one chapter and the opening of another in European politics. The former, developing from the early '80s, reached its pinnacle in 1989 with the collapse of walls and east European regimes. This was when the market triumphed and we reached the "end of history", or so it was said. Thatcherism and Reaganomics were heralded as the final victory of economics over politics.
Just four years on, Europe faces its biggest political crisis since World War II and its greatest economic crisis since the 1930s. "Market economics" has demonstrably failed.
The political crisis, linked directly to the economic crisis, is characterised by the fact that no government in Europe is secure and no opposition party is capable of registering even a blip on the political Richter scale. Never in European history has there been such a simultaneous disenchantment with all the major parties.
As little as 12 months ago, German Chancellor Helmut Kohl, like George Bush, looked unassailable; today he is fighting a losing battle for his premiership. Mitterrand's Socialist Party will lose in spectacular fashion in the March elections in France.
Many observers expect the French SP to lose up to three-quarters of its seats and to be beaten in some urban areas by the extreme right-wing National Front. On the other hand, a Green alliance is expected to top 15% also.
In Spain, Gonzales' Socialist Party, after 10 years in office, is now taking back welfare programs put in place by the despised Franco dictatorship. The 1993 budget is described by the far from radical Financial Times as "draconian". With unemployment now topping 17%, social unrest is deepening. A half-day general strike in May included 140 separate mass demonstrations.
Social Democracy has moved so far to the right as to make its political project virtually indistinguishable from that of the traditional conservative parties. In many countries it is Social Democratic governments that are implementing far-reaching austerity measures. Together with its advocacy of the Maastricht Treaty, a bankers' treaty, this marks the end of Social Democracy as we've known it.
So it comes as no surprise to see a personal friendship and political alliance between German conservative Chancellor Kohl
and French President Mitterrand; or in Britain to hear Prime Minister John Major taunt the Labour leadership that parliament is an echo chamber on economic issues.
In the Netherlands, the Labour Party has been brought into the government because, according to the Financial Times, "Few governments would have dared to tackle the problem [of cutting the welfare state] while Labour was in opposition".
That smug mouthpiece of big business, the Economist, recognises the problem too:
"For the time being, market economics is the only dish on the menu. It is offered, albeit with different trimmings, by conservatives and Social Democrats alike. No wonder, when it seems to be failing — as it does during a recession — that the voters feel almost as lukewarm about the opposition as they are about the government."
In Germany, the Christian Democrats, having failed to pull off a social partnership with the union movement, business and Social Democratic SPD state governments, will quite likely form a "grand coalition" with the SPD after the next elections.
In Ireland, the conservative Fianna Fail has opted for a coalition with the Labour Party.
The political and economic crisis has impacted on the trade union movement too, whose leaderships often are wedded to governing Social Democratic parties. Severely weakened, the union movement continues to lose both membership and influence.
Employers' organisations have expressed concern at the extent of this development and the resulting spontaneous action by workers outside of a union framework, or in some cases in open defiance of union leaderships.
In France, BSN, a major food company, argues that a large enterprise needs someone to represent and articulate the needs of the work force, and to act as a "social partner to the employer".
The AXA insurance group is even offering employees a "union cheque" to pay dues to the union of their choice.
In July, the French non-unionised truckies went on strike and blockaded roads to freight for more than a week; this led employers to call for the industry to be unionised.
Often in spite of the union leaderships, there were massive strikes during 1992 in most European countries, including in the
east.
At least 18 million Europeans are without work, a number that swells by 3000 each day. Austerity budgets, introduced by governments desperate to comply with the Maastricht criteria, are slashing social welfare provisions.
However confused the economists may be at the intransigence of the recession, they nearly all admit that the tough economic convergence criteria mean the only direction unemployment will go is up.
The European Commission estimates that 10 million new jobs would be needed by the year 2000 simply to bring unemployment down to 7%. It admits this is virtually impossible with implementation of the Maastricht Treaty.
With staggering cutbacks in pensions, unemployment benefits and welfare spending, millions of Europeans are now condemned to long-term poverty. For some of the elderly it will be shortened by premature death, a result of being unable to afford to keep warm this winter.
In Britain the boast of the privatised electricity industry is "no family's power supply is cut off due to bad debts". No, instead a coin-operated meter is installed. No coins, no power. Therefore, as one charity organisation explained, poverty forces families to cut off their own power supply. In the Europe of the '90s, many families are having to return to the use of candles.
The current rationalisation and concentration of capital involve driving millions of small farmers, shopkeepers and tradespeople to the wall.
This has long been the role of the Common Agricultural Policy. CAP, contrary to popular belief, functions not to prop up small French farmers, but to drive them off the land through the further concentration of European agriculture. Over the past 20 years, farmers have fallen from 13% of France's work force to 6%, while the average size of farms has increased by 50%
It is estimated that only half the present farmers in France, and one-fifth of those in Germany, will survive the next decade. It is this that lies behind the often violent protests by French farmers and the demonstrations by European farmers around the GATT talks.
The end of this political chapter also ends the pretence of democratic process in eastern Europe. All governments there, while still politically weak, are developing more authoritarian tendencies in order to force through unpopular
social measures.
In Hungary, economic revival and growth are now of secondary importance to the consolidation of political, economic and ideological power in the hands of the new ruling elite, economist Laszlo Andor told Â鶹´«Ã½ Weekly.
The economies in the east remain overwhelmingly state owned, and the little foreign capital trickling in is generally not going into production and certainly not into competition. Much of this capital is going into internal monopoly: buying up already existing supermarket chains, for example, or establishing dealer outlets for foreign cars.
Eastern Europe is now on the periphery of European politics. The euphoria of 1989 has given way to dire crises in the west.
The Maastricht Treaty is the central issue in Europe today and the one that unites all governments and all major political parties.
European capital's main rivals, the US and Japan, don't extend to their citizens the same level of social welfare protection won by most Europeans. The project of European capital, embodied in the Maastricht Treaty, is to rid itself of the burden of welfarism in order to compete on more equal terms. In Europe only 20% of gross domestic product is invested. In Japan it is 30%.
What was achieved in Thatcher's Britain in over a decade is being attempted in Italy in a year. And these attacks will have to go further and deeper if these countries are going to achieve the targets demanded of them under the treaty — all in the midst of the deepest recession since the 1930s.
In Britain and Sweden, the fragility of the social gains won under the influence of Social Democracy's maximum program of nationalisation and welfarism, can be seen by the relative ease with which the conservatives overturned them. Under Maastricht, the market rules — by law.
The treaty is also aimed at building a European fortress to keep out "foreign" goods and "foreigners", particularly those from the Third World. Tough new anti-asylum bills are being adopted to enforce this unstated policy.
The Green group in the European Parliament voted against the treaty. Twenty-seven green parties met in mid-1992 to discuss the treaty's implications, and most were critical. Maastricht is about unlimited growth, they declared.
However, in the French referendum, the Verts (Greens), adopted no
official position because their leadership body was split; and the other green party, Generation Ecologie, said yes to the treaty, but with 36% of its members voting against.
By the last quarter of 1992, hopes that Germany would play the role of locomotive in bringing an end to the European recession were proved to be misplaced. Economists now warn that if the German economy runs into a fully fledged recession, European integration as a whole will hit a wall.
In the first elections in the "new" Germany, in December 1990, the vote tended toward endorsing the optimism, the picture of a rosy economic future, encouraged by the coalition parties and the media. Kohl promised gain without pain: higher living standards in the east, and no new taxes to finance it from the west; he promised no German would be worse off as a result of unification. Today the bubble has burst: hopes have been deflated, as has support for the ruling coalition.
"Half of Germany today", writes one observer, "sees itself sliding out of a golden age, while the other half feels cheated at never having experienced it. The mood is of jaded optimism, of lost opportunity, of identity crisis."
The economy of the former German Democratic Republic is almost completely destroyed. Despite all its defects, the GDR had been the 10th largest industrial economy in the world. Individual incomes were almost as high as in Italy or Britain, and 50% higher than in Spain.
Within a year of annexation, incomes had fallen by a half, while industrial production was slashed by a third. Almost half of the 9.7 million jobs in the east have gone. Even if there is an economic revival, another 1,5 million jobs are set to go.
Those in the east will have to get used to a future with a low employment level. The near full employment of the past is just that, the past. The state secretary for planning and the environment in Saxony, an east German state, explains why:
"The problem everyone knows, but nobody mentions, is about the proportion of active people in employment. In the GDR it was 85 to 90%. In the west it was 55 to 60%. That means 30% of people who were employed in the east are not going to work again. They are nominally unemployed, but not in the western sense."
Even if the east's economy were to grow at a 3% faster rate than the west, it would still take until 2060 for the east to catch up. With the east's economy in ruins, east Germans live by the grace and favour of the west. Two-thirds of east German GNP is made up of grants from the west.
In spring of 1990, almost 90% of east Germans were for economic union. In east Berlin today you see the slogan: "Homesick for '89". Angela Klein of the United Socialist Party told Green Left Weekly that most west German workers now say, "Put the wall back, it was all a mistake".
German academics studying the recent rise in racism foresee an ominous development in which the virtual disappearance of a credible left-wing alternative will allow the intellectual right to attempt a "conservative revolution" at the universities; they predict a "1968 movement from the right".
Already, according to opinion polls, a third of young people agree with the slogan "Germany for the Germans; foreigners out".
But Daniel Cohn-Bendit, a 1968 student leader and now a member of the German Greens, believes we may have reached "the end of the rise of the extreme right", adding "We need to de-dramatise the situation without minimising it".
Certainly it would be wrong to imagine that Germany is on the brink of fascism. The three main extreme-right parties attract only just over 5% of the vote. Anti-racist demonstrations have been huge, though without political clarity — no left party is yet influencing this popular outpouring of public outrage at the increase of intolerance.
On November 9, the anniversary of the Night of the Broken Glass (a Nazi anti-Semitic pogrom), more than 500,000 people participated in demonstrations. The biggest of these was in Berlin, where 300,000 took to the streets. However, this was not an initiative of the left, but of the ruling Christian Democrats, concerned about Germany's image abroad and how that might effect trade.
Nonetheless, the majority of banners indicated support for retention of the right to asylum.
At the Berlin rally Kohl was pelted with eggs and tomatoes by the anarchist autonomist movement. This allowed the government to change the focus from asylum to the proscription of extremist groups. According to Kohl, this means the left as well as the Nazis.
The left is already illegally discriminated against. The Party of Democratic Socialism was denied its state electoral funding of millions of deutschmarks after the December 1990 elections. PDS property owned since the 1930s is being confiscated. One PDS leader, Jakob Moneta, expressed his concern to Â鶹´«Ã½ that the party itself might be declared illegal and banned.
With the German political situation continuing to polarise, the German Greens may return to their former electoral rating of 8%; the other big winner on the progressive side of politics could be the PDS, which according to polls, could get over 30% of the vote in the east.
The people of Europe are not taking attacks on their living standards and human rights lying down. Last year brought the biggest strike wave for 20 years.
Nowhere was that more obvious than in Italy. With Italy's public debt of 100% of GNP, only the most drastic action by the government will keep the country in the running for a Maastricht guernsey.
This has been the justification for a massive austerity program, including an agreement with the union leadership to end wage indexation altogether. This agreement provoked a turning point for the union movement. The first demonstration organised against the agreement brought 100,000 workers into the streets of Rome, in a protest called by the Party for Communist Refoundation, PRC, with the slogan, "Let the workers be heard".
Over the next six weeks more than 8 million workers were involved in protests and industrial action across the country.
Newspaper headlines announced in alarm "a workers revolt" as it became clear that do-nothing union leaderships were in the firing line as well as the government. Unpopular union leaders have been forced to give their speeches from behind plastic shields of the riot police, to protect them from a barrage of rotten vegetables.
In Rome and elsewhere, union leaders have stood on platforms placed 300 metres away from their members — protected in one case by 2500 members of the security services, brought in to beef up the local police force.
The level of worker militancy, coupled with the growing authority and popularity of the PRC, is good news for progressive movements throughout Europe.
Greece too, through September, was in the grip of workers' protests against austerity measures. The scene in Athens was described to Â鶹´«Ã½ Weekly as pickets everywhere, in front of power stations, banks, post offices and company offices. In many cities, clashes with riot police were an every-day event.
The Greek prime minister in December faced his third vote of no confidence in as many months.
Spain and France have also been hit by industrial action reflecting deepening dissatisfaction with the ruling parties.
In Belgium, workers occupying a steelworks, to oppose plans to slash 3000 jobs and enforce a 10% pay cut, are selling 7000 bottles of wine, found in the manager's private cellar, to boost their strike fund.
1993 will be a big year in Europe, even a decisive one. Several countries go to the polls as the recession bites harder. Politicians are becoming so unpopular that the Germans have even invented word to describe this; and the environment continues to worsen, despite the lip service paid to it by all shades of political opinion.
The political situation is opening up, and stark political choices will begin to be posed. It is a period fraught with danger, but also alive with possibility for fundamental social change.