Democrat Editorial - August-September 2009 (Number 116)
The EU is not working
According to unemployment statistics compiled by Eurostat*, published on 3 June, the European Union unemployment rate rose to 9.2 percent, its highest since September 1999, with 3.1 million jobs lost in April 2009, an increase of 556,000 from March. In the Eurozone, 396,000 jobs were shed and almost 15 million became unemployed. The lowest unemployment figures were in the Netherlands at 3.0 percent and Austria at 4.2 percent. The highest figures were in Spain at 18.1 percent, Latvia 17.4 percent, and Lithuania 16.8 percent. Germany had 8.3% of the workforce unemployed with 3.5 million people.
At the end of July a staggering 21.5 million were out of work across the EU.
In Britain the unemployment rate in August was 7.8% after 750,000 jobs were lost over the previous year. Nearly 2.5 million people are out of work. The under 25’s have been hit hardest with 928,000 out of work. For 16-17 year olds, those leaving school, the employment rate is 28.6% leaving nearly three out of four without a job.
Clearly the EU’s much trumpeted and enforced Growth and Stability Pact is, in general across the single market, not working as the opposite is taking place. It does not matter whether a Member State is in the eurozone or outside like Britain.
However it is clear that part of Germany's tentative 'recovery' has been achieved at the expense of eurozone nations such as Italy, Ireland and Spain. Germany has used the downturn and classic measures to make its industries more competitive, with real reductions in wages. Germany has been riding on the system of fixed exchange rates, which makes its own economy ever more competitive against its enfeebled, debt-fuelled neighbours.
Big capital will take advantage of the desperation of people seeking work by gobbling up smaller concerns and pressing wages down. The use of labour from across the EU has already featured in industrial disputes in Britain and elsewhere. Shifting capital is par for the course with no concern for the impact on the workforce laid off, the local or national economy.
Two recent examples of this include the Vestas wind turbine plant on the Isle of Wight with the loss of 600 jobs. The work force occupied the factory as a protest and campaigned to save their jobs. The Danish firm which owns much of the land which fronts the sea is now going for grants to set a research and development unit instead of producing wind turbines. Vestas has declined to sell the seafront land.
Linked to the campaign to save and nationalise the Vestas factory is the local South East England Development Agency with the EU in the background to which it reports. SEEDA with the Government has said they can do nothing to save the jobs despite ‘green’ policies.
Beleaguered Holyhead smelting plant Anglesey Aluminium is set to close in September with the loss of 450 jobs. This is despite offers of a £48m rescue package. However the main reason for the closure turns out to be EU policies which forbid subsidising factories because it “distorts the market”. The power plant they used for electrical supply has been nationalised and the special deal for purchasing electricity has been deemed illegal by the EU.
In Northumberland what would have been the last aluminium plant in Britain is due to be axed. The electricity used is generated by a coal fired power station and offends the EU’s Large Combustion Plants directive. That would be another 600 jobs and the end of aluminium production in Britain.
The real nub of the problem is that Britain’s membership of the EU has undermined the powers of the nation state. It will be even worse if the Lisbon Treaty were put into place turning the EU into one Euro-federalist state with centralised powers further weakening the ability of the Member States to do anything on behalf of their peoples.
The nation-state is the only institution which can control big capital. The sooner these powers are moved back from Brussels to London the sooner a government can carry out legislation and control economic matters, protect industries, jobs and rational development of Britain.
* Eurostat is the Statistical Office of the European Communities.