Friday 27 March 2015

A look inside the EU debt prison


While the Greek government is struggling with their creditors, the European Parliament has published a study on how the crises affects fundamental rights in seven EU member states: Belgium, Cyprus, Greece, Ireland, Italy, Spain and Portugal. The study, which is done by Milieu consultancy in Brussels, cowers the right to compulsory education, right to healthcare, right to work, right to pension and the right to access justice.The freedom of assembly and freedom of expression were also loooked into.

The main conclusion seems to be that austerity undermines fundamental rights across the EU. EurActiv gives a summary of the report:

Education systematically slashed. All countries cut the number of teachers in their schools, while the number of pupils rose. Some schools in Greece are not heated, hygiene standards no longer respected in Italy. More inequality because of lack of books and other equipment.

Health costs transferred from state to citizen. The report states that "in Greece, the bail-out agreement shifted the burden of healthcare from the State to the patient, with an increase in user fees and co-payments for certain medicines", which has led to a series of damaging consequences for the population. Across the member states there is an explosion of waiting times. There is a reference to an article in The Lancet which says that "the predominant response [from the Greek government] has been denial that any serious difficulties exist, although this resonse is not unique to Greece; the Spanish Goverment has been equally reluctant to concede the harm caused by its policies". The article gives the counterexample of Iceland, which decided to maintain its existing health policies even when confronted by the IMF after the 2008 financial crises.

Critical shrinking of employment, pensions and justice. The crises cost EU around 50 million jobs whilst increasing the number of job seekers by 80 million, resulting in mass unemployment in several member states. Belgium, Greece, Spain, Italy and Portugal have all raised the pensionable age, and most countries have reduced the amount they pay out in pensions each month. Legal aid has been cut. Belgium and Greece have introduced VAT on lawyer´s fees.

Horizontal budget cuts. The report highlights that the spending cuts introduced during the crises were rarely specifically targeted at the wasteful uses of public resources. Rather, it seems that many of the imposed measures were horizontal, indiscriminate cuts across policy areas they targeted, in order to meet financial savings that were determined in advance. The abolition of Greek public television is one such horizontal measure, which is seen today as inefficient and potentially dangerous.

Looking inside the EU debt prison one can easely get the impression that austerity is punishing the poor for the mistakes of the rich.