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Pension cuts - less incentives for a career in the public sector?

It is common for people to say that public sector workers' pay, perks and pensions should be cut in these times of economic austerity, and many governments have followed suite in order to cut their deficit.

This could be the right move forward given that many public sectors are bloated, there is too much duplication, and some people argue that the people are inefficient as public sectors jobs are “jobs for life”. However, by taking such measures are governments at risk of failing to attract the best and brightest talent from universities? If we get back to a situation where both the private and public sector in Europe are recruiting en-masse again, which path will a high-flying graduate choose?

Surely some of the draws of the public sector have been that although pay can be (considerably) less than in the private sector, there is job security, more reasonable working hours and a generous pension at the end of it...will we see a drop in quality of the public sector because of this? Or has the private sector always attracted the brightest and most motivated young people anyway?

Retirement is not an award

European citizens see a retirement as an award of which we dream about through our working lives. But it is not an award. For many it means lower monthly pay, decline in social contacts and lack of work routines - and eventually a decline in well-being.

As the life expectancy for our generation is already close to 100 years, why would we want to retire in our early 60s?! I believe our generation’s retirement age will eventually be raised to close to 80 years, and that’s right. In fact, we should be able to work as long as we want and the system should provide incentives for people to work longer, which could include part-time options, training and new job opportunities at an older age.

If I’m healthy, active and I can combine part-time work with wonderful free-time activities, I might not ever retire...

European Youth and the Financial Crisis (originally written by Kaz Poultney, 5 March 2009)

Originally written by Kaz Poultney, 5 March 2009.

European Ministers for Education, Youth, Culture and Communication met last week in order to discuss the impact of the current economic crisis on young people in Europe. During this meeting, ministers adopted key messages for the European Council in March, among them pushing for greater investment in human capital, through improved European cooperation in the field of education and training.

These proposals are just one part of the growing number of European policy responses to the social impacts of the economic downturn. Frustration amongst youth in Europe first hit the headlines in October 2008, as violent protests hit Greece. The €700 group, named in reference to the amount that 56 percent of Greeks under the age of 30 earn per month, rioted for seven nights, causing more than €100 million worth of damage. Although sparked by the police shooting of a teenager, the protesters were soon supported by the two largest Greek trade unions, as underlying resentment of the economic policies of the government came to the fore. In the same period, similar protests hit Spain, Italy, Denmark and Sweden, as European youth united with their elders in a show of frustration.

With European leaders beginning to worry, the winter of discontent rolled on to France. President Sarkozy was soon forced to drop contentious proposals to reorganise the high school curriculum, citing fears of another “May 1968.” As you may remember, this is the same Nicolas Sarkozy, who as Minister of Interior in 2005, notoriously referred to young rioters as “racailles” (scum) and adopted a zero-tolerance policy in the face of civil unrest. Three years later, Sarkozy had backed down in the face of a disgruntled youth.

By January, anti-government protests had also spread to the new Member States, including Bulgaria, Lithuania and Latvia. The atmosphere seemed even more heated. In Bulgaria they called on the government to step down, in Latvia and Lithuania they protested against specific economic policies of their governments, causing the Lativan Prime Minister to infact resign. Some protesters described an “us and them” polemic in the country, similar to that seen at the end of the Soviet era.

Talk of a pan-European movement may be a little ambitious, as each protest has been shaped, by and large, within a specific political and social context. However what links these protests is that they have gone on to attract support from the wide spectrum of society that the financial crisis has affected. However, as most EU governments expect unemployment to continue rising for the foreseeable future, there is real danger that that these incidents will become more common place across the EU.

So what should policy makers do? No one really seems to know. In terms of youth unemployment, one thing EU governments will have to recognise is that it will not just be early school leavers or unskilled workers who will be badly hit. The future of university graduates is also far from secure. In the UK, most graduate traineeships have been taken down, and there are 47% fewer positions available in the city (previously a hub of graduate jobs). In Greece, the unemployment rate for young graduates is 22%, compared to 8% of the population as a whole. It's clear that upon graduating this summer, young adults who believed that with the right qualifications they would reap the financial rewards are about to be let down. For them, the economic prosperity that their parents enjoyed is in danger of trickling out, instead of down.

As it stands, a generation of Europeans that is more connected and more educated than ever, feels left out in the cold. What many EU leaders fear is that their reaction to this will be to try to turn the heat up on their governments.

Here are the some proposals - what do you think?
- Expand education and training opportunities for young people
- Work to inform young people about the non-conventional work opportunities available
- Work with the private sector to increase the number of entry level positions
- Decrease the cost of higher education to encourage young people to stay in university for longer

Europe needs European populism (originally written by Waldo Vanderhaegen, 29 March 2009)

Originally written by Waldo Vanderhaegen, 29 March 2009.

What a joy it is to follow the American elections. Even here in Europe it is a front page news story, with a very high tabloid-like attractiveness. The contrast between the US and the European Union couldn’t be bigger. While the American elections figure intense debate, with a clear policy choice the European elections are stuck in a greyness with relative meaninglessness… at least for the average citizen. European democracy is sick and we urgently need to look for the cure. The economic crisis is in this respect THE opportunity for the EU to reassert its value to its citizens, so we must grab it.

In order to reassert its value for o its citizens and to turn around the slide towards meaningless, Europe needs more populism. Europe needs popular protest for or against a certain way of doing things. Europe needs some actors who put the institutional order in question and other actors who defend it. Europe needs politics, Europe needs populism. If we have no politics, the system will become an administration, a technocracy, and the political traces of social divisions will disappear. Without populism, without politics, social tensions will remain hidden untill they viciously burst open and threaten to destroy what has already been built.

Amongst eurocrats, there is a lot of astonishment and indignation directed at the poor knowledge of the ordinary citizen and the poor coverage given to the EU by the press, while there is so much information available for EU citizens and the press to consult. But we need to be honest with ourselves: do we ever read up on information on topics we consider to be uncontroversial, boring or irrelevant? Of course we don’t! People have to come up to us, to tap us on the shoulder and point out the relevance, the interesting facts or controversy (and preferably all three) before we look into it. The same goes for the EU. Populism is so often coined as bad, cheap or politically incorrect. But it is more about a way of making politics and not about how a set of ideas is formed. Populism is the framing of a set of ideas in a way to appeal to the general public. Populism needs to be that tap on the shoulder that the EU dearly lacks.

Improving how EU policy ideas are communicated to the public is not the only silver bullet. Voting is a difficult thing to do, with all the different parties, the different candidates and the different institutions it is sometimes a real maze, certainly in the EU. On top of that the few easily identifiable actors either are not electable, such as Mr Barosso, or do not seem to have a lot of power, such as your local MEP. We thus need to concentrate the democratic output to less people with more power. The people thus can have a clearer idea about who is who and who stands for what, enabling the voter to evaluate and punish actors correctly through the election process. The people in power would in their turn have the motivation to fulfil the promises and programmes for which they were elected, and also to spread populist appeal and propaganda, thus raising the interest in and democratic value of the EU.

Several solutions have been offered in the past. A possible solution could be to let the European parties each choose one candidate for the presidency of the European Commission, thus effectively limiting the consensual role of the Council, while heightening the political and populist role of the Commission. Other solutions go much further and allow the national representatives in the Council of the European Union to be chosen through an electoral process, effectively creating a sort of ‘Senate’. In this respect I would also follow Libertas chairman Declan Ganley, propagator of EU reform and a clear example of a EU populist figurehead. The key element is the creation of positions for certain people who can explain the EU to ‘Joe the Plumber’ and at the same time create incentives for politicians to advocate EU issues to the general public, in order to get votes for (re-)election.

There are many other ways to further European populism and to create easily identifiable actors, so the EU may head towards real European debate and a real EU democracy, but the vital point is that action is needed. As the EU continues to expand, both in scope, depth and width, the risk will be that it keeps expanding whilst losing its base: the people. If this continues, national populism may overtake European populism causing the European bubble to burst.

Starving in Brussels (orginally written by Waldo Vanderhaegen, 25 March 2009.)

Orginally written by Waldo Vanderhaegen, 25 March 2009.

The past months many angry workers voiced their discontent with workers from other European countries ‘stealing’ their jobs. The economic crisis is taking its toll on employment and public opinion. However understandable this opinion is, policy makers should not give in to impulsive reactions. The migrant worker is also a human being, also adds economic value and migrants have become citizens, part of, and contributing to, Europe’s societies. A report from Brussels ‘down-under’, a city flooded with European migrant workers but benefiting the most from them.

11 ‘o clock in the evening, Brussels, capital of Europe. I am in my local night shop buying some fruit when a shabby-looking man enters. He says in a loud voice that he wants to buy an apple, putting it on the counter, but that the orange in his other hand was already his. However, via the security camera, the shopkeeper had seen him taking the orange from the shop’s outside shelves. The poor man initially denied the theft, but eventually admitted: he had stolen to eat.

Brussels – migration and poverty

It is a tragic story in Europe’s capital, where this January 19,9 percent of the workforce was unemployed, 1.2 percent higher than in December. The economic crisis stings. Paradoxically, Brussels is the third richest region of the EU, with a BBP/person of €53.381, twice the European average. It is also home to one of the largest foreign born populations in Europe. About 46 percent of its one million large population is foreign-born, 55 percent of which is European.

Migration in the European Union

Looking at the more global picture, Europe’s migrating population amounts to 42 millions of which one third, or 14 millions of which are EU citizens migrating to another member state. On country level the foreign-born population thus represents between 7 and 15 per cent of the total population in most western European countries.

Although protests against migrant workers are more frequent, European migrants were very valued by the host countries up until recently. A Commission report demonstrates that migration from new to old member states has had “a clearly positive impact on economic growth” with Eastern European migrant workers hailed to boost EU GDP by 0.28%. With European economies facing a dip, some are tempted to limit the free movement of workers in the EU. However, this would be a counterproductive, destructive and immoral decision

I am a migrant, you are a migrant, we are all migrants

Let us look at European mobility in practice. In my neighbourhood a new snack bar recently opened up. Not just any snack bar, it brings something new to us: falafels. Mr Shawkat exchanged Amsterdam for Brussels as he noticed that we in Brussels barely know or eat falafels. This migrating European brought something new with him. There are many other stories like this.

Europeans on the move do not only add economic value, they have more to offer. A migrant is a human being looking for a better life, changing homes to chase his or her dreams. He can be Romanian looking for a chance to work, an electro fan from Portugal keen on Berlin dancing or a rich British hedge fund manager longing for the simple life in an Italian vineyard. Migrants also bring a lot to our societies as citizens. They compensate for demographic deficits, pay taxes,will help in subsidizing our elderly in a few years and enrich our diverse societies. It is also not a coincidence that one of the icons of our time, Barack Obama, is born from a migrant family. Our 21st century world is a new world; people are becoming nomads again on a constant quest for happiness or freedom.

But… there is a big but. In Europe we believe that success and happiness of individuals depends on an enabling society. Emile Durkheim noticed already in 1897 that the number of suicides depends on an individual’s integration in society. Europe believes in social cohesion and also has to give that to migrating Europeans. In these hard economic times, they need a hand or they will fall, and only few benefit from that.

Providing opportunities to fellow Europeans

2009 is shaping up as a year of recession and retreat of the global economy. However, not everybody will be hit as bad. Success stories are found where there is a solid social security system, proactive government policies and when an individual scores high on skills, education and relations. This last point will make 2009 hard for our migrating fellow Europeans. First of all they will lose employment faster as they work in sectors hit harder by the economic downturn, on average have lower skills and education and have less of a social network in the host country to fall back on. Secondly the growth of informal economies in times of crisis will fuel exploitation of migrants. And finally, the public perception of migrants is likely to worsen.

However, in the Brussels area f.e., 1000s of businesses still need new workers. The Transatlantic Council on Migration rightly notes that “the global economic contraction has not put a pause on the competitive pressures unleashed in an ever-more globalized world”.

Labour law

The tide of public sentiment is rising against welcoming policies. The European Trade Union Confederation (ETUC) blames Europe by saying that the principle of equal labour rights and equal pay for equal work has been damaged by European Court of Justice rulings in recent years.

Has the European social model really been damaged and, if so, is Europe to blame for it? Social policy in this field is a national competence according to the European Commission, as there is no uniform ‘European social model’. The European posted workers directive provides that European migrants have to abide by the host country’s labour laws. If Member States find that foreign European workers are working too cheaply, they should lift minimum wage and improve controls on existing labour laws.

Hey you! What do you think?

Do you think too many migrants work for too little in even worse working conditions in your country? Blame your country’s politicians. Demand more government controls of labour sites and their respect for labour law, and higher minimum wages for all workers. However, be careful in uttering slogans such as “British jobs for British workers”, because you might be hit first with higher prices for garbage collection, difficulties in planning business trips abroad or troubles in finding a job in your own country as your Romanian boss or French customers are no longer there.

Poverty will strike Europe, unemployment will rise and emotions will probably turn against migrants. Policy makers should be open to the grievances, but act rational, non-protectionist and provide sufficient social protection in these economic grim times. European migrants are here to stay, mobility in Europe is a fact and we all benefit from it. The only question that remains is how you welcome them. Do you make the life of our fellow Europeans difficult, thus increasing poverty, criminality and misery? Or do you enable their dreams, facilitating their integration as citizens, workers and human beings?

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