29 jul




No doubt that this, our crisis, is generated outside European borders. Hence, it is only by placing it within the proper historical and geographical coordinates that we can grasp its true extent. It appears equally clear that it is the European Union where the decades-long crisis of global capitalism has now reached its unparalleled peak. Ergo: the crisis that is tearing the old continent apart reveals the general problematic of the current phase of neo-capitalism.

The Neck of The Goose That Laid the Golden Eggs

The current regime of accumulation driven by finance is unsustainable. It represents the desperate attempt of the systemic cycle of accumulation driven by the hegemony of the U.S. to extend its declining fortune. After the gradual exhaustion of the Fordist model of regulation, we are in fact witnessing the financial restart of the economy in the hope of recovering the profit rates eroded by the intensity and the extent of the struggles of the ‘60s and ‘70s. Such an attempt is (also) brought forward through the distorted metabolization of some instances at the core of the protest movements; however, nowadays, this does not matter. What matters the most is how this combination of countermoves has led to a radical transformation of classical liberal democracies – which appear, at any rate, unable to provide a safe haven to the needs of unlimited expansion of capital itself. This disturbing configuration manifests itself in the European Union through the paradoxical features of the historical deadlock where everything degenerates continuously so that nothing can really changes.

The European project – built to compete against American imperialism (Mandel) or, according to other scholars (Poulantzas), to better deal with the political institutions in the new economic framework – bears, in its own matrix, the principles of German ordo-liberalism[2]. From the Treaty of Maastricht to the recent Treaty on Stability, Coordination and Governance (TSCG), via Lisbon, each political step of the gradual European integration implies a subtraction of democratic discretion by implementing mechanisms for (alleged) (re-)structural adjustment. The notorious “external constraints” to the management of currency and interest rates, as well as the strict budget parameters recently incorporated in the constitutions of various countries, set the narrow space for manoeuvre within which it is no longer legally possible to make any progressive political and economic choice: the unconstitutionalisation of Keynesian social democracy. Articles 7 and 8 of the TSCG not only oblige the “contracting parties” to support the European Commission whenever it imposes certain “proposals or recommendations” (sic!) to the state “that has violated the deficit criterion”, but they also establish the possibility of denunciation between Member States[3]. Result: if someone (a country in trouble) does not conform to the parameters, the initiative of a single member state (who knows which one?) will suffice to compel the Court of Justice to impose a remedy.

The straitjacket of these golden rules, therefore, not only prevents de jure from acting on the structural causes of insecurity and inequality, but also prescribes the unbridled rivalry and competition as optimal solutions for the social pathologies caused by themselves. In short, in this constellation, the unique currency is the most effective vehicle for a strategy aiming to ensure universal competitiveness. The euro, as it is, equates countries with radically different forces of production, labour markets, education systems and social security, favouring the explosion of asymmetries, rather than a virtuous upward convergence. Preventing any other type of compensation through monetary policy, the euro de facto validates the wage deflation as the main way to equilibrate the financial and commercial imbalances within the Eurozone. Even worse, the unique currency not only condemns to a programmatic exploitation of work – both at the centre and in the periphery of the EU – it also leads to a model of accumulation increasingly mercantilist and parasitic at the same time.

In such a rigidly disciplined context, the best strategy for a national economy to survive is attacking its neighbouring economies, conquering ever-larger slices of the foreign market through the reduction of internal costs of labour and of its reproduction. In this perspective, labour is the only still available flexible factor on which the costs of social restructuring can be burdened. Through this strategy, Euro opens fertile lands for the capital of the North, which can invade the Mediterranean economies by taking advantage of the benefits accumulated over the previous years with blows of insecurity and wage compression[4]. However, there is more. Marginalised by the increasing international competition, deprived of any monetary weapon of self-defence and subjected to repeated waves of speculation, the peripheral countries are forced to sell out their public utilities and collective patrimonies in order to try to keep afloat, providing the dominant countries a double position of rent in terms of new business opportunities and of granting themselves a pioneering position in key areas.

Because of space limitations we will not discuss the issue of the economic need for an unique currency in constitutively different economies[5], we will rather focus on how such an escalating massacre is producing an indecent pantomime. If we consider how neoliberalism corresponds to a fierce class struggle conducted top-down via diktat and financial blackmail[6], it is then clear that neither the propertied Mediterranean classes (whose social rights, achieved thanks to the struggles of the twentieth-century, can be dismantled through privatization, austerity and liberalization), nor those in northern Europe, are willing to slacken off. This does not mean, however, that they are not willing to grant exceptions (under post-democratic regulations) to the rigid rules, because a zero tolerance policy would result in the collapse of their own expropriation project. Just like the United States of America’s history, the experience of monarchist Italy and the reunification of Germany have taught us, currency unions cannot be made overnight. Without a continuous loosening of governments’ arrangements in the Treaties, the European Monetary Union would have imploded long ago. In this sense, the apparent miracles as the BCE’s Outright Monetary Transactions program, sponsored by Mario Draghi’s presidency, constitutes one among the many stratagems deployed to prevent (delay?) Europe’s final collapse. Similarly, more cracks are slowly undermining the dogmas dear to the Troika, the Große Koalition and the Bundesbank: without such cracks, the EU austerity steel cage would have exploded. National economic policies, in this context of reduced sovereignty, are therefore orchestrated according to seemingly neutral parameters who find their ultimate justification in the a-democratic rationality, a distinctive feature of triumphant neoliberalism. This transcendental principle is nothing but a partisan technocratic construct promoted in order to safeguard the interests of the international ruling élite.

The Aporias of Abstract Europeanism

In the European integration process what is most striking, and revolting, is not the profound democratic deficit within which a political-economic cybernetic is pursued and perfected, it is rather the brash and cynical paternalism through which the representatives of the continental élite supervise the normal functioning of the integrative process. Crisis after crisis, the permanent state of exception and the good of the whole community – being these latter two higher-level instances – force national petty politicians to approve “blood, sweat and tears” measures who would be difficult to justify otherwise.

No government or political leader, in fact, would ever have the necessary support to validate such antisocial policies. Moreover, whenever European desiderata have undergone citizens’ scrutiny the verdict seemed unequivocally clear: from the Danish rejection of the Maastricht Treaty to the threat of the Greek referendum concerning the umpteenth economic drain for its rescue. On the other hand, we might think of the public debate who led Sweden to choose not to adopt the Euro or the negative outcomes of the French and Dutch referendums about the approval of the Constitutional Treaty (in Ireland it was necessary to repeat the experiment several times before getting the correct result…). In short, there is widespread social awareness that something is rotten within Europe but, nonetheless, we still observe a perseverance on an odious – and dangerous – inclined plane!

In addition to the loyal militant base among the ranks of the (former) centre-left, even the progressive wishful thinking, in an intransitive request for “more Europe”, risks to play the role of “useful idiot” in the process of dismantling the social and civil rights obtained over the last two centuries. This is mere strategic myopia. The controversy, however, does not consist in the background ethical ​​or political values (who on the left wing can be against the free movement of ideas, languages, experiences, people, cultures, etc..?) and neither in the long term potential viability of such political and cultural ideals. It rather concerns, on the one hand, the calculation of the current disparity of forces and a reasonable timing in order to hope to change substantially the power imbalance; on the other hand, the consideration of the dramatic situation endured by millions of southern European citizens. Of course, the wounds caused by the premature monetary unification are justifiable a posteriori: radically progressive tax policies, massive increases in the EU budget, strong redistribution from the centre to the periphery, etc. However, in order to do more than just a sterile statement of principles, the demand for a ‘”political Europe” aiming to compensate the rampant economism must urgently explain – the clock is ticking! – who, and how, can succeed in this task. Which subjectivity and what means may act as the Archimedean point (enforcement, English speakers would say) to demolish as soon as possible the neo-liberal Europe without going through a breakup of the monetary union. Two considerations (taken from the caustic pamphlet of Lordon mentioned in footnote) seem to frustrate from the beginning all efforts aimed to reform the euro in a social sense.

First, a reluctant (to say the least) Germany must be persuaded. If we consider how the complexity of the European institutional structure and its constitutive impermeability to grassroots requests regularly counter every good intention, the fetishist German hysteria against the inviolable threshold (2% inflation, the 3% ratio of deficit / GDP, 60 % of public debt) is tenaciously interrelated with a national novel that Germany keeps telling herself since sixty years.

Leaving aside the (doubtful) theoretical and historical consistency of such narrative[7], we must take into account the decisive role played by the German monetary obsession in the making of the FRG that followed the defeats in both World Wars: a strong Mark, source of stability, social cohesion and prosperity. Now, the absolute independence of the Central Bank, the indefatigable budgetary rigor, the unquestionability of anti-inflationary plans, etc. are certainly not inherent to some alleged Germanic immutable essence. Nevertheless, it is at least naive to underestimate the inertial weight of these axioms that, for a long time now, permeate the spirit of German institutions so deeply that they inform the meta-political frame validated (more or less a-critically) by a significant portion of the political spectrum. By the way, such founding myth, over time, has become a “cultural fact”, a “symbolic invariant”; consequently, it will not endure serious consequences when times will change. In this regard, it is a legitimate belief that even a drastic deterioration of the socio-economic conditions of a large part of the German population could have a minor influence. In fact, due to the geo-economic position held by Germany within the international division of labour, it may be among the last nations to suffer from the direct consequences of the economic crisis.

Furthermore, we must remember that, in the first place, the European “edifice” has proved being a deadly war machine in the service of the financial capital and, secondly, that the Euro “as it is” (that is, where ECB is not a lender of last resort and within the existing communitarian parameters) serves as the spearhead of this institutional monster. The risk lies therefore in the discrepancy between the speed of speculative attacks and the time required to set up a considerable change that would diminish the power of finance. It is in fact implausible to imagine that financial markets will stay quiet when a plan to counter their interests is being developed. They would most likely trigger immediate disciplinary waves of panic resulting in either the cover-up of all reformist ambitions or in an uncontrolled rush of the crisis leading both to the collapse of the current monetary order and to the return of national currencies. In both cases, it is not a rosy scenario. Hence, what has to be done to overcome the current stalemate?

Beyond Unique Currency

First, we must recognize how monetary facts accelerate social transformations – for good or for bad. Secondly, it must be emphasized how the unique currency is not necessarily a synonymous of “Europe” or “European Community”. It is not just about the “economistic international”: the free movement of goods, services and, most importantly, capitals is not confined to the space of imagination/ experimentation or to the perimeter of the feasibility of “Another Europe”, to use an expression rejuvenated in the last electoral campaign.

Meanwhile, the tools developed by heterodox economic theory gradually become richer, although it is not likely that social movements will have an impact in [?] using them. Leaving aside production policies: refusal of debt, harnessing finance (taxation of transactions and income and limitations to the movement of capital), a multilateral clearing-house for the balance of international trade (or a common currency), fiscal integration, Eurobonds, cohabitation of national currencies and Euro, etc.. All of these solutions, more than anything else, contribute to the articulation of a socialist governance that, as such, should be welcomed especially in these dark times. They presuppose, however, a delegation to trusted representatives or the support of a political body that still has to come.

So, what should we rely upon in order to begin to improve immediately the existing state of affairs, avoiding at the same time any kind of complicity with the dominant economic logic? As mentioned, the monetary phenomena are a priority in the economic sphere. This is due to the holistic nature of currency, a “total social fact” by definition. Designing and implementing alternative monetary circuits to facilitate economic exchanges, establishing autonomous savings banks to finance a socialization of investments and support the production of man by means of the man: such practices would constitute an optimal solution to circumvent the yoke of capitalist finance, giving formal and material independence back to participants in the initiatives.

Such a monetary proliferation, according to the principle of the common[8], requires the support of technicians and experts as well as a direct implication of activists and citizens. It could definitely serve a democratization of economics and, therefore, bring in positive contents to the intransigent opposition to the increasingly extreme tendencies of capitalism that are ravaging the European Union (which, so far, has proved to be a perverse mix of necessity, domination and chimera or, better: domination through the chimera of necessity). Fighting monetary standardization does not mean fighting capitalism tout court or tackling the ecological crisis. This path, however, could be one of the most profitable ways to circumvent the practical and theoretical traps that so often pollute the majority of discourses related to “Euro, Europe and the crisis”. A fierce criticism of the euro articulated with concrete monetary alternatives might constitute, also in terms of mobilization, a wiser bet.

[2] For the analysis of Ernest Mandel and Nicos Poulantzas, cf. C. Durand, Pour en finir avec l'Europe, La fabrique, 2013, p. 13-19; about the influence of German ordo-liberalism, in addition to the classic study of Michel Foucault on the birth of biopolitics, cf. Dardot P., C. Laval, The new way of the world, Verso, 2013, Chapters 7:11.

[3] “The Contracting Party that, on the basis of its own assessment or evaluation of the European Commission considers that another Contracting Party has not taken the necessary measures to comply with the judgment of the Court of Justice may appeal to the Court of Justice and ask the ‘imposition of financial sanctions” http://www.european-council.europa.eu/media/639226/10_-_tscg.it.12.pdf. For a discussion of the TSCG, cf. F. Lordon, The malfaçon, Les liens here libèrent, 2014, p. 45-50.

[4] For a demystification of the alleged Germanic exploits cf. V. Giacché, Anschluss, Imprimatur, 2013.

[5] In order to establish a socially sustainable unique currency in radically different economies, large-scale changes must be implemented (unification of education systems, harmonization of labor markets, standardization of welfare systems, coordination of macroeconomic policies, fiscal integration to finance these processes and to compensate for residual imbalances between countries, etc..). More than a compelling economic necessity, therefore, the process of establishment of a single currency should be interpreted as an indication of the route: a desirable goal, but certainly not an indispensable prerequisite. In this regard, cf. A. Bagnai, ll tramonto dell’euro (The sunset of the euro), Imprimatur, 2012, in particular p. 129-134.

[6] For a thorough analysis of the recent turn of financial capitalism since the ‘70s focused on the class struggle from top to bottom, cf. D. Harvey, The Enigma of Capital, Oxford University Press, 2010; Duménil G., D. Lévy, The crisis of neoliberalism, Harvard University Press, 2011; L. Gallino, The class struggle after the class struggle, Yale University Press, 2012.

[7] Germany, being the largest creditor in the euro zone, has a material interest in promoting deflationary policies.
Regarding the balances of Target2 cf. http://www.eurocrisismonitor.com/img/EuroCrisisMonitor.jpg; for a quick comment cf. http://thewalkingdebt.wordpress.com/tag/eurostat-bilancia-dei-pagamenti/.

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