Conjoining Crises
Preparations for the WSF are currently ongoing in Europe also thanks to the efforts of the Labor and Globalization network and other
Social/Solidarity/Alternative economy networks concerned with the
current crises. The GEAN is coordinating and establishing synergies with them.
Draft document of the European Cross Networking-WSF preparatory Meeting on the Global Crisis to be held in Paris on 10 and 11 January, 2009.
The financial crisis now affects the «real economy». The United
States and most of the members of the European Union have entered into recession, unemployment has increased and emerging countries have started to be hit. Without a doubt, the poor countries in Africa, Asia and Latin America will be violently affected and the most fragile, in
the North as well as in the South, might fall into extreme poverty of a
kind unbearable to human beings.
This crisis is not only the result of the cynical behaviour of a small
number of financial operators. The 'financiarization' of the economy
finds its origin in a continual decrease of the share of the producted
wealth granted to wage earners: ten points in 25 years in the OECD
countries. The boom of financial profits gained by corporations and of
dividends payed to shareholders, while investments were slacking due to lack of solvent demand, created the conditions for the financiarization of the economy.
Deregulation of financial markets, complete freedom of capital
movements and the growth of the number of tax havens, are at the origin of the crisis. With the absence of real public controls, banking
marketing practices bordering on hoaxes and the implementation of
financial techniques that target maximum profitability in the shortest
possible time, have hastened the current crisis.
The political liability for this state of affairs lies simultaneously
with financial institutions and the national governments which
encouraged the financiarization of their economies. This crisis is
getting connected with other crisis that were pre-existing. The social,
ecological and food crisis are now combining with the financial one to
mark the contours of a fully fledged systemic and global crisis.
Governments have gone about shoring up such breaches in the economy by socializing the losses of private banks. Trillions of public dollars have been poured into this attempt worldwide and without any major political hurdle or condition. At the same time, the positions of the very same governments are on record as holding that it was supposedly impossible to fulfill the social needs of ordinary people because of lack of public resources and while public development aid for southern countries went drastically reduced.
Even worse, the current crisis doesn't protect from attacks against
social rights: the European Central Bank advocates a freeze on wages
and the General Council of Economic and Financial Affairs pushes for an
increased flexibility of labour and to hold on to the criteria of the
Stability Pact. The economic recovery plan developed by the EU, which
isn't more than the simple addition of the various national plans, will
unlikely address the gravity of the situation. The first meeting of the
G20 hasn't led to any concrete measure at the global scale, and those
countries' governements haven't showed any real willingness for a deep shift toward a new economic course.
Economic and political choices must be opened to a real democratic
debate. Citizens must be able to exert their right to participate in the
decision making process at all levels. They must not be asked to pay for a crisis that is not of their own making. It is now necessary to assert
measures which will end the domination of market-oriented finance on the economy, and measures of social emergency, which will shield ordinary people from the effects of this crisis. More to the point, we have to build a new economy based on real distribution of the produced wealth, centered on the fulfilment of social needs, the lasting reduction of inequalities and a long-term response to the ecological imperatives.
In the very short term, it is crucial to hold out against official views
and political choices which keep on legitimating the deregulation and
financiarization of the economy. It is also urgent to engage, in Europe
and with our colleagues worldwide, in the joint work of formulating the
alternatives that we will assert vis-a-vis the EU and the G20 governments.
Large social mobilizations have already been initiated in a few
countries like Greece. The next G20 meeting will take place in London in early April. We, the Europe-based organizations/networks gathered in Paris, call for broad popular mobilizations around the world and
will carry these demands at the World Social Forum in Belem.
Links to several preparatory documents produced by different
European groups:
European Attac Network: "The Time has come. Lets shut down the financial casino."
http://www.attac.fi/european-network/shut-down-the-casino
BankTrack Network: On the role and responsibilities of the private banks in the current crisis
http://www.banktrack.org/show/focus/banking_crisis
CRBM: "short guide to understand the financial crisis"
http://osservatorio.webhat.it/italian/inchieste.php idnews=588&start=0
Eurodad, CBRM, WEED, Bretton Woods Project: Addressing development´s black hole: regulatinig capital flight.
http://www.eurodad.org/uploadedFiles/Whats_New/Reports/Capital_flight_re...
SOMO/Myriam van der Stichele: "Strategic mapping of EU influence on
global financial regulation" (document enclosed)
Tax Justice Network website (www.taxjustice.net)