Exclusive: The European Union’s neoliberal economic orthodoxy has spread income inequality and even poverty across the Continent, spurring extremist movements to challenge this system, reports Andrew Spannaus.
By Andrew Spannaus
The rise of protest movements across Europe, with increasing support for extremist candidates and political parties, comes against the backdrop of a growing sense of insecurity for the middle and lower classes across the continent.
Less stable employment conditions and the stagnation or regression of salaries have created the fertile ground for populist movements on the right in particular, which now mix their traditional nationalist and anti-immigrant rhetoric, with criticism of the economic orthodoxy of the supranational European Union (E.U.) institutions.
In recent years the prevailing response from economists has been that many Western nations are simply unable to compete in sectors dominated by low costs and the high efficiency unleashed by globalization. This narrative, however, is used to hide a more troubling reality: government institutions have contributed directly to the economic difficulties with their own actions, driving down living standards through multiple waves of austerity and blocking attempts to break from the neoliberal principles that dominate among E.U. institutions.
The latest Economic Bulletin from the European Central Bank (ECB) presents a range of statistics that highlight the worsening of living conditions even among the wealthiest countries on the continent. First of all, the ECB admits that the official unemployment rate, high but improving, fails to account for categories such as workers who are part-time for economic reasons or who are no longer actively searching for a job. As we have known in the U.S. for years, broader measures of unemployment can make the actual rate practically double, taking into account problems that the headline statistic easily masks.
According to Prometeia, a respected Italian economic research institute, this alternative view of the weakness of the labor market may explain “why poverty levels are not following a descending path, since…