Krynica, 04/09/2012
(Check against delivery)
I. Opening panel
President,
I thank you for inviting me to speak at this opening ceremony.
It is important that you invited me as General Secretary of the ETUC representing 60 million workers in the European unions. Workers, and around them, their family.
"Hard times" indeed and the reference to Charles Dickens is rightly setting the theme of this session. These times are hard times for 25 million of European unemployed and the figure is rising. This is not rhetoric, this is not just a word, it is lives of people being shaken, hopes destroyed, fear of how to end the month and pay for the rent.
I think that we always need to remember this. Hard times is not hard times for bankers or CEOs, it is hard time for people who worked for years, for young people who cannot start their lives properly.
So what we need is not only a new vision but immediate action to deal with the problems of unemployed people, of precarious workers, or very low pay. A new vision is fine. But it must be accompanied by immediate action.
So what we need is not only a new vision but immediate action to deal with the problems of unemployed people, of precarious workers, or very low pay. A new vision is fine. But it must be accompanied by immediate action.
We are undergoing a long and painful crisis. Let us remember, this crisis originated in a financial crisis. It is not a crisis of the social market economy, it is not a crisis of the welfare state, it is the crisis of casino capitalism and deregulated economies.
It is indeed a crisis of the debt. But the crisis of the debt is exacerbated by financial speculation. It is not exacerbated by wages or by social protection costs. High interest rates are dictated by the markets. Whatever was done until now by the Greeks, the Italian, the Spanish, the Portuguese, or the Irish, it did not manage to satisfy speculators. It is never enough cuts for them, never enough weakening of social protection. All the austerity plans that were implemented to cool down those markets have not worked.
Workers and citizens are left with their problems, with their hard times, and they see no way out of it.
So we have to act to change this. We have to change the policies implemented until now that did not work, we have to stop the austerity programmes, and go through other paths to rebalance the accounts.
Austerity has failed to bring sustainable growth. As we predicted it only brought recession, unemployment and more poverty.
We need to change course. The new vision has to initiate a new dynamic, where taxes would be increased for the rich and wealthy, where tax evasion would no longer be tolerated, where tax fraud would be pursued. We need a financial transaction tax to contribute to the sustainable growth agenda. We also need to stop tax competition between countries by setting a minimum tax rate for companies.
What we need is also more time for countries in difficulty, for people undergoing such hard time, to find their way through this debt crisis.
Further austerity policies, further cuts in wages, further restriction in programmes for the sick or for the unemployed will only make the recession worse.
What we need is effective economic solidarity between the stronger economies and the weaker ones.
Stronger economies did benefit from easy credit in Greece, or in Spain. The debt restructuring costs for those countries would be much smaller than a full collapse of these economies.
What we need as well is to tackle the banking crisis. Deregulation of the financial sector which started in the eighties was the starting point of the disconnection between casino capitalism and the real economy. Casino capitalism was and still is a world on its own, producing money with money, without links with productive investments and jobs. Only the happy few, or perhaps the unhappy few, can claim that they understand how this sector is operating. Who is betting on what, on which basis, and on which ground. This must stop. This is a crazy situation where a handful of people hold in their hands big, but extremely fragile institutions. The worse is that these institutions cannot be led to collapse because they are so big. And therefore governments have to cover their debts, in other words tax payers have to pick up the bill for the casino capitalist.
Indeed, on that front we need a very new vision, and very determined decisions.
Our new vision must also remember very simple things.
Our economies are not there to produce wealth for a few; they have to improve the lives of the more modest. We strongly reject the ideology which leaves everything to market forces. Our conviction is that a social market economy is a good answer. A social market economy accepts that the capital is a forceful incentive and can be source of development, but at the same time we are convinced that unleashed capital and unleashed market forces are leading to an unfair and crazy society.
We know that, in the recent past, inequalities have not diminished but increased, poverty has gone up, and social protection has gone down.
Part of social market economy is social protection
That is something we should be ashamed of. Social protection and a more equal society are a good thing. We hear much too much the rhetoric that social protection cannot be sustained, that it is something of the past.
I would certainly go against this: social protection is a sign of progressive societies, of societies who care, of societies in which the objective is not to ask people to be in constant competition with each others.
I think we should be proud of the post-war achievements in this respect and exert our skills to promote the values it carried, rather than implying that social protection is something of the past.
ETUC is very concerned by the growing feeling that Europe is not working for them but against them.
ETUC is very concerned by the growing feeling that Europe is not working for them but against them.
In our vision for Europe we need to give concrete proofs that Europe is respecting their social achievements, is respecting equal pay for equal rights at the same workplace, is promoting protection. Unfortunately there is very little of this going on currently.
The ETUC vision for the future is summarised in our proposal for a social compact for Europe. This social compact would change the policy line of austerity, increase the income side of the national accounts, re-establish proper dialogue for fair solutions. A social compact for Europe would re-regulate the financial sector and would promote social and trade union rights in Europe. It would put in place minimum wages, either by law or collective agreements that would not be under the level agreed in the council of Europe.
ETUC is open to discussion with employers and governments on our proposal. I do hope that this opportunity of constructive discussion towards fair and socially acceptable solutions can be taken up. The ETUC offer is on the table.
This social compact encapsulate is our vision for Europe. In our vision the lives of individual people are our focus, our key preoccupation.
President, we need a vision for Europe for the future that would promote the post-war achievements, adapt them maybe. We need to develop our concept of what a social market economy is with strong industrial relation systems, social protection, education, health, transport as public services missions.
This vision must be accompanied by immediate action to help curve the unemployment, poverty, low wages and inequalities.
We need both the vision and the action.
I thank you for your attention.
II. Panel on Crisis of the Welfare State and Trade Unions
President, participants,
Thank you for inviting me to speak in this panel which is, of course, of crucial importance for trade unions.
Let me first start by challenging the theme of this panel: crisis of the welfare state and trade unions.
I do not think there is a crisis of the welfare state as such. The crisis we are going through is a crisis of the debt, originating largely in the deregulation of the financial sector. The crisis started in the UK with the collapse of Northern Rock in 2007 followed in 2008 by the earthquake created by the bankruptcy of Lehman Brother.
It is because Ireland had to rescue its bank that the country is now under the scrutiny of the Troïka. It is because the banking system offered unreasonable credit facilities that the Spanish people are suffering from the construction bubble. Too much credit facility was one of the reasons why Greece reached high level of public deficit and was no longer able to finance itself on the market.
In no way can the crisis be understood as a crisis of the welfare state. If there are difficulties for the welfare state it is because austerity programmes have been imposed to make it less costly. It is not the welfare fare state which did put us in this mess. But the welfare state, unfortunately, is paying for it.
And what is the welfare state? The welfare state is social security, medical coverage, it is unemployment benefits, it is state pension. The welfare state is what makes cohesive societies, societies that bound people together, societies that care. The welfare state is a society where inequalities are diminished and poverty reduced.
We should not speak of the welfare state as something of the past, as something that our societies should forget about. What is our model after all? What sort of society do we want? Do we think that reducing inequalities is a good thing? Do we think that public transport is good? That education leading to social progress is a right for all independently from family income? That one should not be left without care because he or she is poor?
What I mean to say is that the welfare state is a unique postwar European achievement and it must be looked at in a positive way. Unfortunately neoliberal ideology considers that the welfare state should be abolished, because people should manage their own affairs, struggle for life and money and permanently compete with each others. This ideology is destructive of societies and values.
And this is where I see the link between trade unions and welfare societies. Trade unions are organisations defending values and achievements of the welfare societies: securing collective rights rather than individual rights, increasing low wages, fighting against inequalities and for social justice.
And this is where I see the link between trade unions and welfare societies. Trade unions are organisations defending values and achievements of the welfare societies: securing collective rights rather than individual rights, increasing low wages, fighting against inequalities and for social justice.
What are the role and the value of trade unions in the financial and debt crisis we are going through? Our answer is rather simple: trade unions are well-structured representative bodies. Their function is to defend the right of people and to negotiate the best possible solutions when problems arise. And problems arise very often.
In a neoliberal ideology there is no place for trade unions, because there is no place for collective rights or negotiated solutions. Individualism and self-reliance are key. If you are a winner, you make it in life. If you cannot fight, you will be poor and disconsidered. Obviously there is no place for trade unions in such a society.
We strongly reject this ideology. Our conviction is that a social market economy is a good answer. A social market economy accepts that the capital is a forceful incentive and can be source of development, but at the same time we are convinced that unleashed capital and unleashed market forces are leading to an unfair and crazy society.
Unleashed financial forces and casino capitalism is leading to the crisis we experience. Who would, today argue that we should continue on the same line?
In a social market economy trade unions have their right place. Their place is to transform the values of fairness and social justice into realities. This goes through activism and through negotiation. These are the two functions of trade unions. One does not go without the other.
In a social market economy trade unions have their right place. Their place is to transform the values of fairness and social justice into realities. This goes through activism and through negotiation. These are the two functions of trade unions. One does not go without the other.
So the first step in a period of crisis is to recognise the value of organised forces, like trade unions as a means to find implement solutions. And this is possible, of course. Having sound economies and strong trade unions is not contradictory, it is complementary. We only need to look at Nordic countries, at Germany, at Austria. Stronger economies have not been built against but together with trade unions.
This fact is quite widely recognised. In many public documents, and particularly documents and speeches made by EU officials, EU politicians, the value of social partnership and social dialogue is fully recognised. And this is positive.
However reality is very different. In this period of crisis measures that are promoted are measures which weaken trade unions. Their capacity to bargain is challenged or limited. Governments overrule them or ignore them.
In Eastern countries the problem is particularly acute. Instead of supporting structures conducive to negotiations, governments accept that US style anti-trade union policies are developed. The Baltic States are massively experiencing this. In Hungary labour code has been reformed with negative consequences on trade unions.
Social partnership must be autonomous. This is the rule. Governments should step out of negotiations. Unfortunately there are very powerful pressures which currently push governments into weakening the trade union capacity to negotiate.
I would like to add something else in this context. Social partnership must be autonomous, but governments have their role to play. If governments want social partners to find right solutions, they should offer adequate platforms and conditions to negotiate. In Belgium the ‘Conseil central de l'économie’ is an example of such platform. What I want to say is that an autonomous dialogue will develop when there is a positive ground around it, when conditions for negotiations are effective, and negotiated solutions favoured.
Positive negotiations also need a favourable social climate around them. Let me take the example of Nordic countries. Governments of whatever political color would not dare to challenge the value of discussions with trade unions. Nordic societies consider that trade unions are a normal part of democratic structures. There is an atmosphere which is conducive to accepting that trade unions are part of the solution rather than part of the problem.
Indeed: we should never forget that trade unions and trade union rights are an essential element of democratic societies. There is no real democracy where trade unions are rejected or actively fought against. Free trade unions are part and parcel of free societies. There are no true democracies in countries which are denying the right of organisation and the right of negotiation.
In recent days you celebrated the 32nd anniversary of the Gdansk agreements. During those historical days, here, in Poland, trade union freedom and trade union rights were granted after a long and remarkable fight. This fight is and will be remembered. It is a clear sign that trade union rights are part and parcel of democratic rights.
Unfortunately there are still many countries, particularly in Eastern Europe, where this basic human right principle is not respected.
My conviction, the conviction of the ETUC is that in a period of crisis for the welfare state (and not of crisis of the welfare state) trade unions are an integral part of the solution.
This is why the European trade union confederation is putting on the table its proposal for a Social compact for Europe.
This social compact is setting our vision and giving a base to negotiations to overcome the crisis in a fair way, not in a destructive way. Our social compact for Europe insists on economic and social justice, industrial relations and negotiations, and sustainable growth towards employment. With these tools we could find the solution out of this crisis and save our very valuable welfare state.
I am convinced that this is the line we have to follow to secure a common sustainable future.
I thank you for your attention.