Continental Rift?

Continental Rift?

As the affluent Seven plus Russia gathered in Denver, American sermons on the virtuous methods to reduce unemployment worked so much on European nerves that even the Continent’s conservative pape


As the affluent Seven plus Russia gathered in Denver, American sermons on the virtuous methods to reduce unemployment worked so much on European nerves that even the Continent’s conservative papers began to argue that a society with a yawning gap between haves and have-nots, with its working poor, its inner-city slums and huge prison population, is not exactly ideal. Indeed, introducing that on the Continent might prove explosive. But there is a difference between questioning a model and putting something in its place. After the Amsterdam conference, which preceded Denver, the European Union looked too disunited to produce any pattern, though it may also be suggested that the unexpected Socialist victory in France has introduced a potentially creative period of disarray.

Originally, the Amsterdam summit was supposed to complete two years of preparations to bring the Maastricht Treaty up to date and adapt the institutions of the European Union to a wider membership. The mountain, however, barely produced a molehill. Nothing was achieved on common defense and very little on the joint shaping of foreign policy. Decisions were postponed on such practical issues as which questions will now be settled by a majority vote, or how small and big states should be represented in Brussels without the ruling commission becoming unwieldy. After all, here is an organization set up by six countries, counting fifteen members and thinking seriously of eastward expansion.

Actually, the meeting in Amsterdam was dominated by the euro, the common currency, or rather by the stability pact, dictated by the Germans and imposing financial orthodoxy and penalties for budget deficits exceeding 3 percent of G.D.P. Lionel Jospin claimed during the French electoral campaign that he was not bound by this straitjacket, but a compromise was patched up at the last moment in Amsterdam. The French obtained a vague text on growth and employment, the promise of a special conference later in the year and the claim that a counterweight will be set up to balance the E.U.’s independent central bank. The Germans clearly got the better bargain: the stability pact and no commitment for expenditure on public works. The prospect for the euro is still uncertain. Nobody knows whether next spring, when it comes to the admission of the first members of the Economic and Monetary Union on the basis of this year’s results, the 3 percent limit on budget deficits will be applied literally or “in perspective,” taking into account the trend of a country’s economy. In any case, when the French and Germans don’t drive in tandem, the European Union is not advancing.

Was the deal accepted by the French a sign that Jospin has already begun a retreat? Not necessarily. Addressing the newly elected National Assembly, the Prime Minister stuck to his program. He promised the French a “republican pact” (the word must be taken here as contrasting with monarchist, not democrat), insisting on the importance of mass secular education, on the rights of women, on the abolition of laws directed against immigrants and the restoration of the right to French citizenship for everyone born on its soil. He put the emphasis on justice as a social link and, unfashionably, defended the public–as opposed to private–sector. Yet he also admitted that his government will ultimately be judged by its ability to combine social justice and equality with the struggle against the curse of unemployment. Here, too, Jospin has clung to his Keynesian pledges to create public-sponsored jobs for the young and to reduce the working week to thirty-five hours without pay cuts. But except for the minimum wage–raised immediately by 4 percent, to about $6.80 an hour–most measures will have to wait till an economic balance sheet is drawn in mid-July and matters are discussed by the government, the labor unions and the employers in a major conference to be staged in September.

If the proof of the pudding is in the eating, its taste is partly determined by the way it is baked. The economic policy of the new government will be shaped to an important extent by the strength of the labor unions and the pressure of the movement from below. After all, without the social upheaval, without the winter of discontent of 1995, there would have been no early election and, therefore, no left-wing government. And the phenomenon is not limited to France. In March the sudden closing by Renault of its Belgian subsidiary at Vilvoorde brought thousands of European auto workers to the streets of Brussels. On the eve of the summit, some 50,000 jobless from all over Europe flocked to Amsterdam. Something is clearly stirring in Europe as a reaction to the renewed austerity drives.

The first lesson to draw–really a reminder–is that strikes, demonstrations, pressures from below, once they reach a certain level, have a political impact. Historically, the United States is , not doomed to the “American model” either: A strong shove from the labor unions would at once alter its shape. What is needed is resistance combined with imagination. The second lesson requires a more complex development and can only be hinted at here. Paradoxically, the victory of the French Socialists did not directly put socialism on the historical agenda. As you can see from America, it has raised the problem of “capitalism with a human face.” It is only while searching for this myth that the French, and others behind them, may start looking beyond the confines of existing society.

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Katrina vanden Heuvel
Editorial Director and Publisher, The Nation

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