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What’s Going On In Europe?

by Joe Friday, Nov. 26, 2010 at 9:49 AM

"The attack on education is an international phenomenon. In the UK on Wednesday, tens of thousands of students walked out of classes over tripled tuition fees. Thousands participated in a demonstration in London, where more than 1,000 were penned in and contained by police for hours. Police used batons to beat back students attempting to reach parliament. The demonstrations in Britain came two weeks after more than 55,000 took to the streets throughout the UK. A crackdown by the government has included the arrest of dozens of students. In the US, there have been mass protests and, in some cases, occupations in the state of California against tuition fee increases of more than 30 per cent. The education cuts in Italy and the UK are part of a wave of austerity measures throughout Europe aimed at forcing workers and young people to pay for an ongoing economic crisis."

What’s Going On In Europe?

-----

General strike brings Portugal to a halt

By Paul Mitchell ?25 November 2010

Yesterday’s general strike in Portugal brought the country to a halt. Millions of workers from the public and private sector stayed away from work to protest ahead of a vote in Congress on the Socialist Party (PS) government’s budget and austerity measures.

The opposition Social Democratic Party said it would not vote against the budget, ensuring its adoption Friday.

The government claims its austerity measures are needed to cut the deficit from 9.3 percent of gross domestic product (GDP) in 2009 to 7.3 percent this year and then to 3 percent in 2012. They include an increase in the goods and services (VAT) tax, a freeze on pensions, cuts in wages, the minimum wage and family allowances, slashing budgets for health care, education and local council services and privatising more state-owned assets.

Portugal’s public debt stands at €165 billion (3 billion), about the same as its GDP. Portugal’s stock and bond markets have come under extreme pressure in recent days in the wake of the Irish crisis and speculation has soared that Portugal will be the next country to go to the European Union and International Monetary Fund for assistance.

Yesterday’s general strike was called by the Communist Party-led General Confederation of Portuguese Workers (CGTP) and the PS-aligned General Union of Workers (UGT), the first time both unions have called out their members for nearly three decades.

“We consider it to be the biggest strike ever,” declared UGT head Joao Proenca. CGTP general secretary Manuel Carvalho da Silva added, “I’ve never seen so many people support and identify so closely with the causes of a strike before.”

CGTP officials said 75 percent of all workers in the country took part in the strike. Labour Minister Maria Helena Andre revealed, “We are facing a very reduced participation in the private sector of the economy.”

This is a new development—up to now strike action has largely been confined to the public sector.

Portugal’s largest exporter, Volkswagen's Autoeuropa plant, which produces 500 cars a day, came to a standstill. Trains and buses in the capital Lisbon came to a halt. Many shops were shut. Almost all workers employed by city and town municipalities stopped work. No flights took off or landed at the country’s airports. Ports were also closed. Other public services—health care, education, the post office and banking—operated minimal services.

Yesterday’s strike was a sign that workers want to fight. However, they face not only the PS government but also the opposition right-wing Social Democratic Party, the US and European governments, the International Monetary Fund, the bond markets and other global financial institutions and the media—who are all applying maximum pressure on the PS to make sure it does not waver in its attacks on the Portuguese working class. Borrowing costs for the government yesterday rose close to the record high reached earlier this month.

The current cuts are just a prelude to more next year and the years after, until all remnants of social welfare have been destroyed and the working class has been driven further into poverty.

Lisbon University political science professor Antonio Costa Pinto commented, “The strike is going to be important in symbolic terms, but there will be no major impact on the government, or the budget or the economic policy of this government.”

Labour Minister Andre stated that there was no turning back for the government.

The forces lined up openly against the working class are aided and abetted by the CGTP and UGT union federations, which called yesterday’s action only in order to dissipate the nationwide opposition to the austerity measures while they collude with the PS government and employers to smuggle them in.

Significantly, there was an absence of any visible mass mobilisations of those on strike. While making a protest, the trade unions are determined to ensure there is no focus for mounting social anger. The CGTP and UGT are not opposed to austerity per se. Their plea is that the ruling elite demonstrate for public consumption that they are seen to shoulder some of the burden. The strike was “a cry,” Carvalho da Silva said.

“It’s indisputable that today we need to fight the deficit, or face the penalty of having the IMF around, but it can’t be only the workers that pay the bill,” declared Proenca. “If we fight the deficit by sinking the country, then we aren’t going anywhere.”

---

European markets fall as Ireland reveals further austerity plan

By Jordan Shilton ?25 November 2010

Ireland’s government unveiled its four-year “recovery plan” yesterday, which will aim to reduce its budget deficit to 3 percent of GDP by 2014. The plan, the imposition of which was demanded by the European Union and the International Monetary Fund in order to secure a bailout, will see the budget cut by €15 billion—€10 billion in spending cuts and €5 billion in tax hikes.

The measures did not have their desired impact, as markets fell sharply across Europe. Government bonds for the most indebted countries rose once again, and bank shares fell steeply. Ireland’s 10-year bond yield rose to near 8.8 percent yesterday afternoon, with Greece also suffering badly.

The fears were driven by news that Ireland would likely be forced to nationalise two more banks, Allied Irish Bank and Bank of Ireland. At the same time, it expressed the conclusion of the markets that even the savage measures contained in the plan would not be able to save the state from default. The financial parasites that have speculated away billions upon billions want far more.

The National Recovery Plan 2011-2014 outlines one of the most severe austerity programmes ever in post-war Europe. The €10 billion in spending cuts over the coming four years will see government expenditure fall from 49 percent of GNP in 2010 to just 36 percent in 2014, which is the equivalent of a decline in budgets by more than a quarter, on top of a €14.5 billion package already implemented.

The plan calls for a €2.8 billion cut in the social welfare bill, even as official unemployment is above 13 percent. €780 million of this will be cut next year, the details of which will be contained in the budget on December 7.

Cuts across the health, education, justice and agriculture departments will amount to €3 billion. The health budget, which presently stands at €6 billion, will be reduced by €1.5 billion, including a cut of 6,000 jobs.

Education spending cuts will include a 5 percent reduction in funding for schools, and fees charged for students attending college and university will rise from €1,600 to €2,000.

The government will launch an assault on workers’ pay, with the minimum wage being slashed by 12 percent or €1 per hour. The public sector pay bill will drop by €1.2 billion, and there will be 13,200 job losses across the public sector between now and 2014. Twelve thousand jobs have already gone in this area since 2008, meaning that the final total will be 25,000 job losses. For new entrants to the public sector, a 10 percent pay cut across the board will be imposed.

In terms of the tax bill, the poor and low paid will suffer most. Income tax will be increased to raise a total of €1.9 billion, which translates into a 1 percent increase from 2012. The wage threshold at which income tax is payable will also drop from around €18,000 to €15,000. VAT will rise from its current high level of 21 percent to 22 percent in 2013, and 23 percent in 2014. A new charge for water will be introduced, while a number of tax reliefs targeting low-paid workers will be removed.

Pensioners will also come under attack, with a reduction of public pensions of over €800 million proposed. The retirement age will see a phased increase between now and 2028, reaching 68 years by that time. Worse still, Finance Minister Brian Lenihan has said that the state’s pension fund is on stand-by to support the banks if needed.

In estimating these figures, one must always keep in mind the fact that Ireland’s population is just 4.5 million. The cuts double a previous €14.5 billion cuts package that saw Ireland’s government slash public sector spending by 7.5 percent of GDP, public sector pay by 15 percent, child benefit by 10 percent, and unemployment benefit by 4.1 percent. If this had been done in Britain, for example, it would be equivalent to £150 billion. Now that figure is being doubled.

Meanwhile, the business elite will continue to enjoy a 12.5 percent corporation tax rate. The document stated, “A low rate of corporation tax on export-oriented activity has been a cornerstone of our industrial policy since the 1950s, and the 12.5 percent rate is now part of our international ‘brand’.” The document affirmed that corporation tax would “not be increased under any circumstances.”

Despite the wide range of targeted areas and the depth of the cuts, the measures are a fraction of what will be required to prevent state bankruptcy. The estimation of the total cost of the bank bailout continues to rise, with one commentator noting on Wednesday that as much as €120 billion would be needed from the EU/IMF.

Standard & Poor’s downgraded its credit rating for Ireland overnight on Tuesday, and illustrated its lack of confidence in any government plan by maintaining a negative outlook for the future.

Market concerns also saw shares in Irish banks fall. AIB and Bank of Ireland shares both fell by around 20 percent, as reports confirmed that the state would be compelled to take a majority share in both institutions and assume responsibility for yet more gambling debts. The plan only refers in passing to the cost of the bank bailout. This figure will certainly rise in the coming period and will demand a corresponding increase in savings from the government.

As well as the pressure of the markets for even deeper cuts, the projections contained within the plan were based on government assumptions that are seen as extremely optimistic. According to the Financial Times, a number of economists felt that growth figures of 1.75 percent in 2011, 3.25 percent in 2012, 3.00 percent in 2013 and 2.75 percent in 2014 were unlikely to be reached.

The response of the political opposition was muted, with few complaints raised with the main thrust of the plan. Kieran O’Donnell, the deputy enterprise spokesman for Fine Gael, told RTE radio that his party would not rewrite the plan but rather amend certain “specifics”, which he did not outline. Finance spokesman Michael Noonan confirmed that Fine Gael would still be committed to the 2014 target of 3 percent of GDP, while party leader Enda Kenny claimed that specific measures could be “renegotiated” with the EU commission. This will do nothing to alter the savage measures being imposed.

The trade unions are tasked with policing the opposition this will inevitably provoke within the working class. David Begg, head of the Irish Congress of Trade Unions, gave his pledge to do so in the form of a rebuttal of the earlier comment by the general secretary of the Technical Engineering and Electrical Union (TEEU), Eamon Devoy, who warned that “we are on the brink of significant civil unrest in this country, the like of which has not been witnessed in this jurisdiction for decades”.

Begg disputed this, stating that while “There is no suggestion” that workers “don’t want to go out onto the street, what they don’t necessarily want to do is wreck buildings and burn cars.”

“It’s not the case that people think the whole thing is inevitable, it’s simply that they’re much more law abiding people who don’t want a revolution,” he told Reuters Insider television.

It is Begg’s particular responsibility to prevent the emergence of a revolutionary challenge to the government and the capitalist class. But he faces an uphill struggle. The trade unions too have been massively discredited by years of collaboration with the employers and various governments that culminated in their responding to the onset of the crisis by signing the Croke Park Agreement with the Fianna-Fail/Green Party coalition. The agreement promised a no-strike deal and collaboration with the previous round of cuts, in return for a supposed guarantee not to cut pay further or to introduce compulsory redundancies.

Lenihan insisted the Croke Park deal would stand, but would be subject to a review in 12 months. In reality, it is honoured only in the breach, given that pay is being cut and mass redundancies are inevitable. All it now signifies is the continued desire of the government and the unions to collude against the working class. There will be a “whole new ball game” for the Croke Park Agreement in the New Year due to the economic crisis, according to one of the architects of the agreement.

Labour Relations Commission Chief Executive Kieran Mulvey, speaking at the Oireachtas Committee on Enterprise, Trade and Innovation, said that without the agreement, the 5,000 job reductions demanded in the Health Service Executive could not have been secured without “open warfare”. But the agreement would face a “whole new ballgame” in six months time, given that the agencies it covers in health, education, the civil service and local authorities will face a significant level of potential expenditure reductions.

The Irish Small and Medium Enterprises Association said the decision to maintain the Croke Park Agreement “is a nonsense”. It was, they complained, “a missed opportunity” to address “once and for all” the costs of running the public sector.

---

Student protests in Italy against education cuts

By Marc Wells ?25 November 2010

Tens of thousands of students marched in Italian cities Wednesday to protest education cuts implemented by Silvio Berlusconi’s government. The protests came the same day as further mass demonstrations of students in Britain against budget cutting.

In Italy, students mobilized in more than 50 cities and occupied 44 out of the 66 public universities, picketing, suspending classes and climbing on top of faculty buildings. Some of the occupations continued through the night.

The largest demonstrations took place in Rome. A group of students protested in front of the Deputies’ Chamber, while another attempted to break into the Senate, although they were prevented from doing so by riot police (See Youtube video).

Students shouted slogans like “Ridateci il nostro futuro!” (Give our future back!), “No ai tagli!” (No cuts!), “Dimissioni!” (Resignations!) and “I veri terroristi siete voi!” (You are the real terrorists!).

Stones and eggs were thrown against the state buildings. Light injuries were reported by a dozen students, a police official and eight Carabinieri (military police). Two students were arrested, and complaints were filed against 27 demonstrators.

Demonstrations took place in Padova, where police charged students; Pisa, where students blocked several bridges; and Siena, where 100 students occupied the railway. There were also protests in Florence, Turin, Naples, Pavia, Perugia, Palermo and Salerno. Teachers and researchers joined the demonstrators.

The Unione degli Universitari (a federation of syndicalist students groups) has stated that it has “no intention to stop. We have every intention to intensify the struggle if this government continues to ignore the demands coming from the entire academic world.”

The Gelmini Reforms (named after Mariastella Gelmini, Minister of Education) are the main target of the protests. They are a series of laws and executive decrees that, along with the 2010 budget law approved last December, are part of a massive attack on public education. In 2008, the initial law triggered a string of mass protests and strikes in the fall of that year (See, “Italy: Protests and strikes against Belusconi education cuts”)

These “reforms” amount to a drastic decrease in funds allocated to public education, resulting in mass layoffs and reduced programs.

The attack on education is an international phenomenon. In the UK on Wednesday, tens of thousands of students walked out of classes over tripled tuition fees. Thousands participated in a demonstration in London, where more than 1,000 were penned in and contained by police for hours. Police used batons to beat back students attempting to reach parliament.

The demonstrations in Britain came two weeks after more than 55,000 took to the streets throughout the UK. A crackdown by the government has included the arrest of dozens of students.

In the US, there have been mass protests and, in some cases, occupations in the state of California against tuition fee increases of more than 30 per cent.

The education cuts in Italy and the UK are part of a wave of austerity measures throughout Europe aimed at forcing workers and young people to pay for an ongoing economic crisis.

This past week, market speculation in Irish debt built up pressure for a new multibillion-euro bailout of the banks, which will be paid for by further austerity measures directed at the Irish working class. Amidst talk of “contagion,” Portugal and Spain are being watched carefully. A default of Spain would put into serious question the viability of the euro currency as well as the European Union as a whole.

After Spain, Italy is next in line, with a teetering economy, a large sovereign debt, a massive political crisis and high unemployment.

As in Britain, the response of the Italian ruling class is to pledge repression. Neo-fascist Gianfranco Fini, president of the Deputies’ Chamber, referring to the student protests, declared that he “firmly condemns this unacceptable incident of violence and intolerance.” Two weeks ago, Fini left Berlusconi’s government, opening up a political crisis that will lead to a confidence vote on December 14. This is the day after another austerity measure—the 2011 budget law (now called the “Stability Law”)—is scheduled for a vote.

The Senate president, Renato Schifani, a member of Berlusconi’s Popolo della Libertà (PdL—People of Freedom) was even more explicit in threatening violence against students. He remarked that the government has made many “appeals to the sense of responsibility in order to lower the tones and avoid a situation where the increase in violence and intolerance turns into acts of incivility that could trigger deaths.”

This is a clear warning that the ruling class is ready and willing to utilize all the force necessary to repress any protest or dissent. The threat follows years of increased attacks against the living standards and democratic rights of Italians by both center-left and center-right governments.

The so-called opposition also supports the education cuts. Democratic Party Secretary Pierluigi Bersani pulled a stunt when he joined students and teachers on the roof of the architecture faculty building in Rome. While posing as a supporter of the protest, his presence is intended as a sign to the bourgeoisie that the Democrats are ready to take control of the situation and reroute opposition into safe channels.

Bersani’s statement gives an idea of how a Democratic government would resolve the education crisis. According to him, “Even in Greece they are implementing social and educational reforms. Sooner or later we will also get there.”

Just as in Greece, where the working class has seen wage cuts of 30 percent and unprecedented attacks on pensions, Bersani is offering his services for the implementation of harsh austerity measures in Italy.

-----

Would it not be great to some day actually make the rich work? Just imagine their fear. How wonderful would that be? Please share this document widely. Joe

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What’s Going On In Europe?

By Joe and Friends

"The attack on education is an international phenomenon. In the UK on Wednesday, tens of thousands of students walked out of classes over tripled tuition fees. Thousands participated in a demonstration in London, where more than 1,000 were penned in and contained by police for hours. Police used batons to beat back students attempting to reach parliament.

The demonstrations in Britain came two weeks after more than 55,000 took to the streets throughout the UK. A crackdown by the government has included the arrest of dozens of students.

In the US, there have been mass protests and, in some cases, occupations in the state of California against tuition fee increases of more than 30 per cent.

The education cuts in Italy and the UK are part of a wave of austerity measures throughout Europe aimed at forcing workers and young people to pay for an ongoing economic crisis."







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