Strikes a barometer of Europe's austerity tolerance

 
A worker stands at a picket line at Mitrena shipyard, south of Lisbon A picket line at a shipyard in Portugal as the country observes a strike in protest at austerity measures

Across Europe people are taking to the streets to express their anger and frustration with austerity.

There will be disruption and protests. General strikes have been called in Spain and Portugal, and there will be action in Greece, Italy, Belgium and France.

The day will serve as a barometer of the mood in Europe.

Is it increasingly angry? Or just resigned?

The question that worries many of Europe's leaders is when will patience run out? When will tolerance of high unemployment and declining living standards snap?

The eurozone's strategy still holds. Deficits must be reduced. Structural reforms - such as the opening up of labour markets - are the key to future growth.

Countries must regain their competitiveness with Germany by slashing wages and pensions.

The European Commission believes that austerity may hurt growth in the short term, but in the longer term it will revive confidence in Europe.

It remains a hugely controversial policy. There are those who say it has failed in Greece.

There, the economy has shrunk by 23% in five years. Many economists insist it is madness to continue with austerity when so many southern European countries are already in recession.

Spain has an unemployment rate of 25% and is in recession. In five of its 19 regions, unemployment stands at more than 30%.

Yet the government in Madrid is embarking on another round of spending cuts that will only further weaken demand.

The human cost of those policies has been underlined in the past two weeks by two suicides linked to the repossession of homes.

Unemployment rates

  • Spain 25.8%
  • Greece 25.4%
  • Portugal15.7%
  • Eurozone 11.6%
  • France 10.8%
  • US 7.8%
  • Belgium 7.4%
  • Germany 5.4%
  • Japan 4.2%

Eurostat

The protesters will march behind the slogan, "They are taking away our future".

The Greek prime minister, while pushing austerity measures through parliament in recent days, has also said he accepts his country is facing the equivalent of the Great Depression.

Austerity-lite

Recently, the IMF conceded it had underestimated the impact of austerity on living standards and there are signs of greater flexibility in the eurozone.

Deficit-cutting targets for Spain, Greece and Portugal have been eased.

Brussels is said to have moved towards an "austerity-lite" policy, but the fundamentals stand. Southern Europe has to reduce its deficits and debts.

The key question remains; how will growth be restored?

Without it, Europe faces a future of hardship. German Chancellor Angela Merkel has said the eurozone crisis may last five years.

She has just visited Portugal, where she praised the sacrifices being made and promised that one day the "painful" changes would be positive, but she was booed during her visit.

A youthful generation may not be prepared to accept unemployment at more than 50% for five years or longer.

In the past three months the eurozone crisis - as reflected by the markets - has eased. The economic outlook, however, has worsened.

Wednesday's day of action will be watched closely to gauge Europe's mood.

 
Gavin Hewitt, Europe editor Article written by Gavin Hewitt Gavin Hewitt Europe editor

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  • rate this
    0

    Comment number 278.

    277.
    DurstigerMann
    "that's why i hope, for the sake of Austria, that the media campaign against Frank Stronach not only fails, but that enough people vote for him that he and his party can actively participate in government"

    At the moment his chances are similar to those of the Green Party.
    While the Greens favor a coalition with the Socialists, Stronach would go the Conservative path.

  • rate this
    0

    Comment number 277.

    @276austriacus

    that's why i hope, for the sake of Austria, that the media campaign against Frank Stronach not only fails, but that enough people vote for him that he and his party can actively participate in government.

    As a German, i am sad that we don't have a sinilarly successful yet genuine and independent man going into politics in order to change things.

  • rate this
    0

    Comment number 276.

    274.
    margaret howard

    Similar in Austria. From the moment I was capable of watching Austrian domestic politics, "Verwaltungsreform" (=streamlining of administration) has been on the agenda.. But as soon as the voters of one of the 2 major reigning parties are concerned, the endeavours stop immediately.
    Suggestions of the "Rechnungshof" (=court of auditors) are ignored consequently. Embarrassing.

  • rate this
    +1

    Comment number 275.

    I still find the word "austerity" bizarre in this context. It conjures up Dickensian images of workhouses.

    In truth, it now means living within one's means. Take a drunken gambler, give him a coffee and tell him to stop frittering away borrowed money - would that be austerity? Or just common sense budgeting?

    Don't let this emotive word fool us. It means the end of partying on credit.

  • rate this
    0

    Comment number 274.

    271 austriacus

    It's just as bad here. Our new Education secretary plans to halve his department's annual expenditure of £580 million and sack 1 000 staff.

    The thing is, what where they all doing there in the first place?

    Shows that profligacy has nothing to do the the EU but everything with weak governments who daren't take on their own unions.

  • rate this
    0

    Comment number 273.

    We have 2 splitting criteria for the Council of Ministers now:

    Eurozone versus non-Euro members

    net payers versus net receivers.

    A nice 4 square matrix of possible conflicts and alliances.

  • rate this
    0

    Comment number 272.

    "If Greece reverted to the Drachma, what would change for Greece?"

    Probably nothing as a good proportion of the Greek wealth is now a long way away from Greece, the owners of which would most definitely not want to convert back to Drachmas.

  • rate this
    0

    Comment number 271.

    http://www.bbc.co.uk/news/world-europe-20338529

    "Studies show that 3,000 employees are required in Greece for local administration work carried out by 1,000 people in Germany," German Deputy Labour Minister Hans-Joachim Fuchtel said.

  • rate this
    0

    Comment number 270.

    European UNION?

    Happily married, family completed, if then to care for more, orphans say -

    Do you set-table as in Three Bears, porridge-bowl sizes according to genetic, cultural, financial endowment?

    No, all citizens must share income equality

    All must find, make, accept work; or take loss

    As a family, accepting 'economic' best-direction of capital

    Equal Partnership

    So difficult?

  • rate this
    0

    Comment number 269.

    Discarding is a symptom of all that is wrong within the EU.
    To throw away good food because of quota's while people starve on this planet is obscene.

  • rate this
    0

    Comment number 268.

    http://ec.europa.eu/fisheries/cfp/fishing_rules/discards/index_en.htm

    "Discarding is the practice of returning unwanted catches to the sea.
    In the EU, the rejected and often dead fish and shellfish that are
    thrown back do not have to be counted against quotas.
    However, this issue is high on Comm. Damanaki's agenda and the new proposal for a reformed CFP foresees provisions to end this.."

  • rate this
    0

    Comment number 267.

    It's nice to see that the UK wants to end the scandulous throwing away of good food, just for its looks. As it wants to end the scandal of throwing back into the sea hundreds of tons of fresh fish.
    MH sorry for your bad experience of lights, mine go back on the tree every year.

  • rate this
    +1

    Comment number 266.

    I found the answer to my question:

    http://www.telegraph.co.uk/news/worldnews/europe/2453204/Bent-banana-and-curved-cucumber-rules-dropped-by-EU.html

    I knew there must be a demand for non-conformist fruit and vegetables.

  • rate this
    +1

    Comment number 265.

    263.
    Dailymailreader

    EU quality standards do not come out of the blue. They are regularly created because some member countries ask for them.

    I do not know:

    Did or will Britain opt out of this standard?

    If yes, You are free to buy bananas of all shapes and sizes.

  • rate this
    0

    Comment number 264.

    263 DM

    "2257/94 regulation laid down for quality standars for banana's.
    Mentions abnormal curviture"

    Excellent news. We mustn't let standards slip.

    I wish the EU would impose strict quality standards on Chinese goods as they nearly always fall apart within days.

    My Christmas lights lasted 2 weeks. They replaced my German made ones which I bought over 30 years ago. Quality lasts.

  • rate this
    -1

    Comment number 263.

    Margaret for you,
    2257/94, regulation laid down for quality standars for banana's.
    Mentions abnormal curviture.
    Good news, the EZ might be in double dip recession, but we can eat nearly straight banana's.

  • rate this
    0

    Comment number 262.

    259.
    Chris London

    A constitutional convent is being prepared. First proposals may be on the table by end of this year. We will see.

  • rate this
    -1

    Comment number 261.

    258 dm

    "Been hearing and reading of the demise of the west since the 50's. Communism, oil producing countries, Japan and now China"

    You should add America to this list. It's past success is a flash in the pan, made possible by 2 wars in Europe and exploitation of raw materials obtained by illegal means.

    Now there are alrady 35 states that want to secede, the same as in the civil war.

  • rate this
    +1

    Comment number 260.

    Gavin

    I fear that you are off the mark with regards to Ireland. Things aren't what they may appear. I would love you to expand on this statement.......

  • rate this
    +1

    Comment number 259.

    austriacus
    Yes this will be interesting to see how the politicans and bureaucrats try to sell this one. They have snooped around the edges nibbling here and there however at some point it will need the big question to be asked. In Germany's case it will need the approval of the court. I can't see them going for it for it as it will mean the beginning of the end for them.
    sieuarlu - USA recovery

 

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