Book Reviews | Gordon Campbell | News Flashes | Scoop Features | Scoop Video | Strange & Bizarre | Search


The European Elections: The Assault on Austerity

The European Elections: The Assault on Austerity

By Binoy Kampmark
May 7, 2012

The answer, even though they see over and over again that austerity leads to collapse of the economy, the answer over and over [from politicians] is more austerity.’
Joseph Stiglitz, Asian Financial Forum, Jan 17, 2012

It has been a busy weekend. France finds itself with a new president, its first socialist leader since François Mitterand left office in 1995. Greek voters flocked to the parties of the anti-bailout movement with indignant enthusiasm. The liberals seem to be holding on, narrowly, in Serbia.

The true effigy in burning after the elections is austerity itself, a doctrine that has assumed the form of biblical doctrine in the hands of German Chancellor Angela Merkel. Sarkozy was its co-progenitor, though his failings were far more profound than his dalliance with the German leader.

And that doctrine has shown itself to be flawed. Le Monde (May 4), prior to the election on Sunday, suggested that embracing austerity was dangerous and poisonous, the sure guarantee of electoral suicide. The mood in Europe was changing towards those ‘drastic cuts in state expenditures, raising taxes, reforming the labour market and so on’. ‘More growth will bring higher tax revenues that are necessary to service the public debt.’

Whether François Hollande actually makes the difference is questionable. Sarkozy, for one, can hardly be said to have suffered a comprehensive defeat. The National Front candidate Marine Le Pen refused to endorse either two of the frontrunners. Hollande was in the end fortunate that the centrist François Bayrou endorsed him on Friday. Promises have been made to raise taxes with an acknowledgment that economic growth is essential.

The austerity doctrine took its predictable hammering in the Greek elections, with both New Democracy and the main socialist party Pasok getting respective pastings. Austerity has been made a condition of EU-IMF assistance, not to mention the country remaining in the eurozone. The voters felt otherwise. Yiorgos Vrassidis, a voter who directed his ballot to Syriza, the grouping of the Radical Left, made his intentions clear. ‘The politicians who got us in to this mess continue to mock us. Neither of them will do anything, all they are interested in is pulling the wool over our eyes so they can get into power again’ (Guardian, May 6). The bailout has been termed everything from being ‘barbaric’ to a constituted ‘economic Fourth Reich’.

Alex Tsipras, Syriza’s leader, has vowed to do something that will shake Brussels to the core – suspend the servicing of Greece’s debt altogether and add a ‘pro-growth’ clause to the repayment arrangements. But the options presented to voters, according to the Greek left-liberal newspaper To Vima (May 4) have merely suggested that the country’s politicians have run out of ideas. Lies are in ample supply, even if the money is not. ‘The only thing they don’t talk about is reality.’ Greece has two options: abide by the wishes of the creditors (the austerity credo), which will reduce it to a rump state economically on par with Romania or Bulgaria; or abandon the program altogether, which would lead to ‘an even greater shock’. The German magazine Der Spiegel (May 6) is steadfast in its glumness. ‘It’s clear that there is no alternative to austerity.’

There is little need to speculate too much about where things will go with such notions as the fiscal pact Merkel has endorsed, or the technocratic gospel that holds sway over budgets. The tight pocket is not necessarily the most feasible one and constrained spending has shown itself to be disastrous. The institutional arrangements for the euro, for one, were not sound to begin with, and fracturing is inevitable. Cutting something that is shrinking has the tag of suicide written all over it, but it is a suicide that European governments have been propelled towards for some time now.

The electoral reality has shown that austerity has been willed a slow death, but so have the victors who have profited from voter dissatisfaction. They are only bound to disappoint. As the Nobel Prize-winner Joseph Stiglitz notes, ‘Politics is at the root of the problem.’


Binoy Kampmark was a Commonwealth Scholar at Selwyn College, Cambridge. He lectures at RMIT University, Melbourne.

© Scoop Media

Top Scoops Headlines


Moving On: Tributes To Scoop's Editor And Co-Founder Alastair Thompson

Jeremy Rose: I've been trying to recall when I first met Al: Was it before or after Bob Jones punched him? I remember bumping into a senior Dominion journalist, just after the pugnacious millionaire had added Alastair to the list of journalists he had lashed out at, and asking: What happened? "I don't know," he replied, "but he probably deserved it the cheeky little bastard." More>>

Werewolf: In A New York Groove

Right now, there’s a thing about downtown Manhattan in the 1970s and ‘80s, a lot of talk about an era that still resonates powerfully. Plenty of people in this city, still walking around and breathing in and out, were very involved in the world below 14th Street. More>>


Keith Ng On Public Address: Why The Police And The PM Are Wrong About Rawshark

On 2 October 2014, the Police raided Nicky Hager’s home... During the search, they found a piece of paper... “We considered [the document] was of interest to the investigation because of information we had already obtained”. That piece of paper was seized and designated NH025... More>>


Gordon Campbell: On Islam And The Paris Attacks

Presidential contender Ben Carson for instance, wants it to be made illegal for a Muslim to be elected as President of the USA. For the Republican Party at least, freedom of religion in America extends only to tolerating many ways of accepting Jesus Christ as your personal saviour. In reality of course, treating Islamic State as the essence of Islam makes about as much sense as treating the Ku Klux Klan as the essence of Christianity... More>>


Get More From Scoop

Top Scoops
Search Scoop  
Powered by Vodafone
NZ independent news