Campaign Against the Austerity Treaty

Vote No to the Fiscal Compact Treaty, Referendum in Ireland, May 31 2012

Archive for the ‘UNITE’ Category

UNITE MANDATE and the CPSU Call for No in the Austerity Treaty Referendum

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Three major trade unions with combined membership of more than 100,000 have issued a strong call to vote no in Thursday’s referendum on what they are calling the austerity treaty.

The Civil and Public Service Union (CPSU), Mandate and UNITE trade unions represent workers across the private and public sector and a wide range of industries from retail to transport and finance.
UNITE Regional Secretary Jimmy Kelly said:
“The Treaty is only about austerity and does not have any provisions relating to growth.”
“It has been rushed in as a panic measure. No less than ten Euro zone countries have now slipped back into recession.”
“The problem with the treaty is that it enshrines the very policies that have caused that recession to get deeper and more damaging.”
“Ireland has a chance to say No, and to pull Europe back from the brink of economic self harm it has been engaged in to disastrous effect over the past three years.”
Mandate General Secretary, John Douglas said that the Fiscal Treaty if passed will not create one job:
“On the contrary it will legally lock down Irish economic activity at its current levels, and may even shrink domestic demand further leading to mass unemployment, decades of emigration and sow the seeds for future social conflict.
“This Treaty has nothing to do with ‘good housekeeping’ or ‘managing the household budget’; it is about copper fastening into an internationally legally binding agreement, decades of austerity, social exclusion, mass long term unemployment and emigration – and a continuation of attacks on workers’ rights and the welfare system. It is not about what is good for Irish citizens, or the citizens of Europe, it is a treaty of the Right for the Right!”

CPSU General Secretary Eoin Ronayne said:

“The Treaty amounts to writing into law the failed policies of the neo liberals who got us into the mess we are in.”
“Why on earth would lower and middle income people vote to make their lives even worse than they already are”
“What the ordinary citizens of the EU need is a sustained and comprehensive growth package putting money back into their pockets so that they can spend in their local economies generating jobs and protecting existing employment”
“Nothing in this Treaty will do that and a NO vote is the only way for people to stand up and say we’ve had enough of what got us into this crisis and that it’s time for change”
Each of the three unions has been working with activists and workplace representatives to encourage debate among members and present a balance to the government messaging that there is no choice but to say yes. Read the rest of this entry »

“Oppose the erosion of social rights…reject better treatment for banks over people” – Patrick Kinsella’s Article in the Irish Times

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Writing in the May 24 2012 Irish Times Patrick Kinsella argues for rejection of the Austerity Treaty, finishing with this blunt warning for the Irish Labour Party in a coalition government with the ultra-conservative Fine Gael party:

On this issue, the Labour Party in Government has abandoned its traditional constituency, signing up to support the banks at the expense of equality, jobs and fair working conditions. It has abandoned the social pillar of the European Union in the interests of an illusory “stability”. I sense that its traditional constituency will abandon Labour at the next election

We recommend the full article, proving beyond any shadow of a doubt that the Fiscal Compact is a dangerous enemy to all shades of the left, including very moderate traditional social democracy.

A British New Statesman article entitled “The EU treaty is a disaster for the left” is just as compelling :

New Statesman – The EU treaty is a disaster for the left

The author Owen Jones, whose “Chavs: the Demonization of the Working Class” is published by Verso says bluntly :

Consider this: as Paul Mason has written, “by enshrining in national and international law the need for balanced budgets and near-zero structural deficits, the eurozone has outlawed expansionary fiscal policy”.

Read that last bit carefully. Left-wing governments of all hues will, in effect, be banned by this treaty. If the French or the German left returns to power in the near future (and both are in a good position to do so), it will be illegal for them to respond to the global economic catastrophe with anything but austerity. An economic stimulus is forbidden – because the treaty has buried Keynesianism.

To date, Four Irish Trade Unions – MANDATE, UNITE, the TEEU (Electricians) and the Civil and Public Service Union (CPSU) have logically acted, understood the Treaty threat, and called for a NO in the referendum to be held on May 31.

Many activists know of people close to the Trade Union movement and Labour Party who know these arguments are 100 per cent true, but have not spoken their minds – they should broadcast now, reject the austerity policy of Tánaiste Éamon Gilmore and his government ministers, and join the NO Campaign.

They need look no further than Patrick Kinsella’s article :

Treaty is a social, political and economic threat

Thu, May 24, 2012

OPINION: Voting No is not a rejection of the EU – it is to oppose the erosion of social rights. It is to reject better treatment for banks over people, writes PATRICK KINSELLA

FOR NEARLY 40 years it has been pretty easy to find reasons to vote Yes to the succession of European treaties.

Like the rebel plotters in Monty Python’s Life of Brian asking “What has Rome ever done for us?”, we can answer that as well as better roads, we have more jobs, agricultural prosperity, quality education, cleaner water, and the promotion of equality and human rights, all benefits that might have seemed utopian back in the 1970s.

Yes, things are grim compared to a couple of years ago, and unemployment is at crisis levels. But total incomes, personal consumption and the number of people at work are all still higher than in 2003, which was not a bad year.

Free trade has been good to Ireland. But the European project is not just about free trade, and there are two compelling reasons to vote No to the latest treaty.

The first compelling reason is economic: the fiscal stability treaty does nothing to repair damage to our banking system, and nothing to reduce unemployment. The Government is locked in to an austerity policy that both theory and practice demonstrate to be wrong. It has been abandoned by the United States, by voters in Greece and France, and earlier this month by the voters of North Rhine Westphalia, Germany’s most populous state.

The policy problem is Angela Merkel’s obsession with reducing debt. She is wrong: running a national economy is emphatically not like running a household or a business – households and businesses do not control the money supply. Governments need to borrow to invest and central banks need a stock of government bonds as a means of managing interest rates.

Obviously, excessive borrowing will lead to inflation, but excessive saving will lead to deflation – more job losses and business closures – and that is what is happening across much of Europe now.

Voting No to the fiscal treaty will not reverse current economic policy – that’s a political issue that will be resolved only after the German federal election next year. But voting Yes would make the austerity permanent, writing into national law a requirement to cut budgets or raise taxes here for as long as general government debt is more than 60 per cent of gross domestic product.

It’s no good the Government talking about a growth agenda if it means only market liberalisation and further cuts in pay. European governments need to borrow more money and invest it in worthwhile projects if unemployment is to be brought down. And large-scale, long-term borrowing to invest would be legally banned under the fiscal treaty.

The second compelling reason to vote No is purely political. The treaty upsets the historic balance that lies at the heart of the European project – the balance between labour and capital. The EEC was founded partly to prevent another war between France and Germany. But free trade, and free movement of goods, services and money were always to be limited by the protection of social rights.

Europe built on Germany’s post-war “social market economy”, which provided stability, profits, low unemployment and a welfare state. The main trade unions and most social democrats have been enthusiastic supporters of a project that promised social justice as well as prosperity; a commitment to equality as well as the right to make profits.

The fiscal treaty, by what it says and what it does not say, ends that balance. For the countries that sign it, the needs of the banks will be permanently ahead of the needs of the people. There is no social chapter here: just cut the deficit and limit government borrowing, whatever the social cost.

What kind of Ireland, what kind of Europe do we want? Competitive and flexible? Yes, but surely not at the cost of permanently low wages, poor public services, high unemployment and social insecurity. This is not a fantasy nor scaremongering, it is already under way.

Just one example from my place of work: there’s no such thing as a “job” in a university anymore. The very best we can offer new recruits is a five-year contract. Not just in the State sector but throughout the economy, on issues of job security, employment conditions and pension provision, risk is being transferred from investors and employers to employees and the unemployed.

This turns the expectation of profit as a reward for taking risk on its head, and reverses the historic consensus on which European prosperity and social cohesion has been based – and all to protect the integrity of a banking system that failed in its primary duty of prudence in lending.

The single currency scheme was flawed from the start, because the euro member states were unwilling to surrender the sovereignty needed to sustain it. Unwilling to harmonise taxes and spending policy, unwilling to borrow money as a unit, unwilling to transfer resources from one region to another in the way the US federal government does, unwilling to tax and properly regulate the financial system.

Merely limiting states’ capacity to borrow does not address these issues, and does not provide any basis for currency stability. That’s a task to be tackled by the new French president and a new German chancellor.

The Government is rigorously following the policies required by the troika of intergovernment lenders who support our current spending deficit and our bank rescue, and voting No will not change that. But the political situation in Europe is changing radically, and it is absurd to think that our partners will leave us high and dry for future loans because we reject a legal straitjacket on future policy demanded in the dying days of the Merkel regime. And don’t think the ideological rebalancing demanded by the fiscal treaty is limited to the euro zone members: the final article says “steps will be taken” to incorporate the substance of it “into the legal framework of the European Union”.

The political context for the social market economy in the 1950s and 1960s was the spectre of communism that haunted Europe. The context now includes the indignados of Spain, riots in Greece, and right-wing parties. Those of us with no great wealth other than our education worry for our children: where will they work, how will they live?

On this issue, the Labour Party in Government has abandoned its traditional constituency, signing up to support the banks at the expense of equality, jobs and fair working conditions. It has abandoned the social pillar of the European Union in the interests of an illusory “stability”. I sense that its traditional constituency will abandon Labour at the next election.

In the meantime, those of us who think that on balance the European Union has been good for Ireland, and do not want to see that balance overturned, have compelling reasons to vote No to this treaty.


Patrick Kinsella is head of the school of communications at Dublin City University and is a member of the Tasc Economists’ Network

© 2012 The Irish Times

EU Austerity Treaty = More Taxes and Cuts: Vote No! – Statement Signed by Elected Representatives, Trade Unionists, Community Activists, and Academics

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Opponents of Austerity Treaty say:

Treaty would make elections a sham!

Show us the cuts.

Campaign Against the Austerity Treaty

EU Austerity Treaty = More Taxes and Cuts: Vote No!

Cuts in services and extra taxes on ordinary people have brought nothing but unemployment and poverty – austerity has made the crisis worse.Now we face the EU Austerity Treaty, supposedly to stop governments spending more than they raise in tax.

But the deficit in Ireland is not due to public spending. It is due to the collapse of tax income, caused by closures and unemployment resulting from the collapse of construction and the bank crisis. Private investment has dried up, so the only way out is for the state to finance public works such as hospitals and schools – as well as funding our public services. This gets people back to work and can promote sustainable development.

Instead, this Treaty would force governments across Europe to cut services and increase taxes – like the household tax. This would make things even worse: more out of work, less spending, more closures, long term poverty and deepening debt. That’s what’s happening in Greece.

What happens if we say NO?

The scaremongers who say that Ireland will be pushed out of the euro if we vote no are lying. Ireland will remain in the EU and the eurozone, but will not be in the Austerity Club. Ireland will not be isolated. An Irish ‘No’ will challenge the EU’s austerity policies. It would be a vote to link up with ordinary people across Europe – putting the needs of people and the environment before the super-rich and the banks.

Blackmail

The government’s only argument to support the Treaty is the Blackmail Clause. This says that Ireland won’t get money for a second ‘bailout’ from the ESM fund if we don’t approve the Austerity Treaty. Fine Gael and Labour agreed to put this Blackmail Clause into the ESM Treaty and the Austerity Treaty. But they also have the power to get it out, because Ireland has a veto over the amendment to the Treaty on the Functioning of the European Union needed to set up the ESM Treaty. The government has said that the votes on the ESM Treaty will happen after the referendum. If they want a free and honest debate on the Austerity Treaty, the government could declare that if the Austerity Treaty is rejected they will veto the ESM Treaty unless the Blackmail Clause is removed.

What happens if we say yes? Cuts and tax increases

The rules of the Austerity Treaty would bring more cuts and tax rises: up to €5.7 billion more from 2015 to 2017 – on top of current proposals of €8.6 billion in cuts and tax up to 2015. The Treaty would also effectively deny governments the right to engage in significant public spending, such as major public works, to get people back to work. Given the collapse of private investment, strangling public investment would bring more unemployment, poverty and stagnation – especially as it would be done in Ireland and across Europe at the same time.

Article 3 of the Treaty imposes a harsh target of a structural deficit of 0.5%. In 2013, the European Commission estimates that 18 out of the 25 countries affected will be in breach of this target. Meeting the target across Europe will mean cuts and austerity of over €160 billion. This will be devastating. In Ireland, the Department of Finance estimates we will have a structural deficit of 3.7% in 2015. Closing this gap would mean extra cuts and taxes of up to €5.7 billion – yet more health cuts, education cuts and unjust taxes like the household tax.

Article 4 strengthens the existing Stability and Growth Pact requirement for states to maintain a debt-to-GDP ratio of 60%. Under this rule a state in breach of the 60% limit will have to reduce the excess portion of their debt ratio by 1/20th a year. In Ireland’s case this will strictly apply from 2018, when we are expected to have a debt-to-GDP ratio of about 120%. But from 2015 – when Ireland leaves the current austerity/bailout program – and 2018, Ireland will nevertheless have to make “progress towards compliance” with the debt-to-GDP rule. If GDP is growing in 2018, Article 4 will not necessarily require an actual reduction in the debt. However if the economy remains in recession or growth is marginal, which is the likely outcome of the cuts required by Article 3 of the treaty, then Article 4 would require additional austerity in order to reduce the debt. All this would be on top of the €9 billion a year interest payments on the national debt from 2015.

Democracy – RIP

The Austerity Treaty would turn elections into a total sham. No matter what government was elected, or however big a protest movement, austerity policies would be permanently in place. This Treaty would put the decisions on budgetary policy into the hands of the European Commission and the European Court of Justice. Merkel and Sarkozy want this Treaty because it would make the EU an enforcer for the speculation debts of their banks – no matter what policies other governments were elected upon.

Where would we get money?

The government will have a deficit of about €15.8 billion this year – €2 billion of which is going to the Anglo and IL&P bailout. Ireland also has an increasing debt because the state has taken on the gambling debts of the banks – including Anglo – at the insistence of the EU. So the first step to reducing the deficit is to stop paying bank-related debt – it’s not our debt – and write off billions in debt and interest payments. The next step is to tax wealth. There are net financial assets of €107 billion in Ireland, mostly in the hands of the richest 5%. Wealth taxes, increased capital taxes and eliminating loopholes could reduce the deficit significantly.

Life before debt

These first steps, along with major public works, are vital to stop the impoverishment of our people. Money is available: the ECB recently loaned €1000 billion at 1% interest to European banks. This could have gone to governments as low interest loans for public works – which would get hundreds of thousands back to work and slash the deficit. The Austerity Treaty would enforce the opposite: cuts and poverty – to protect bankers.

Call for a ‘NO’ vote

Stopping the Austerity Treaty is vital for stopping more cuts and taxes on ordinary people, and retaining the democratic right of governments to implement the policies on which they were elected. We call for a ‘No’ vote on the Austerity Treaty in the referendum on May 31st.

Signed:

Gerry Adams TD, Padraig MacLochlainn TD, Mary Lou McDonald TD, Peadar Toibín TD, Pearse Doherty TD, Senator Kathryn Reilly, Aengus O’Snodaigh TD, Brian Stanley TD, Caoimhghín Ó Caoláin TD, Dessie Ellis TD, Jonathan O’Brien TD, Martin Ferris TD, Michael Colreavy TD, Sandra McLellan TD, Sean Crowe TD, Senator David Cullinane, Senator Trevor O’Clocartaigh, Catherine Murphy TD, Luke ‘Ming’ Flanagan TD, Finian McGrath TD, John Halligan TD, Thomas Pringle TD, Mick Wallace TD, Joan Collins TD, Clare Daly TD, Seamus Healy TD, Richard Boyd Barrett TD, Joe Higgins TD.

Jimmy Kelly, Regional secretary, UNITE, Dr. Michael Cronin, NUI Maynooth. Dr. Sinéad Kennedy, NUI Maynooth. Professor Joe Cleary, NUI Maynooth. Professor Luke Gibbons, NUI Maynooth. Marnie Holborow, DCU. Ailbhe Smyth, Feminist Open Forum. Eddie Conlon, DIT and Executive Committee Member TUI Dr. Kieran Allen, UCD. Dr. Andy Storey, UCD. Dr. Gavin Titley, NUIM. Dr. Colin Coulter, NUIM. Andy Storey, School of Politics and International relations, UCD; Theresa Urbainczyk, School of Classics, UCD; Professor Kathleen Lynch, Centre for Equality Studies, UCD; Helena Sheehan, Professor Emerita, DCU; Cathleen O’Neill, Kilbarrack Community Development Programme; Eithne Murphy, Economics Department, NUIG; Councillor Louise Minihan (Éirigí), Dublin City Council; North Cork Anti-Austerity Campaign. Cllr Ted Tynan (WP) Cork City Council, and Cllr Davy Walsh (WP) Waterford City Council.