Spain: Workers resist austerity

June 19, 2010
Strike against austerity measures in Madrid, June 8. More than two million people participated across Spain. Photo: Arribalasque

Two million Spanish workers participated in a public sector strike on June 8. A general strike in the Basque country has been called for June 29. Spanish unions have called a nationwide general strike for September 29 and the European Trade Union Confederation is currently attempting to organise a Europe-wide general strike to coincide with it.

The strikes are to resist austerity measures imposed, at the urging of the European Union, in response to the “sovereign debt crisis” — a blowout in European government debt. But the cause of the crisis is the direct and indirect rescue of the banks following the 2008 global financial crisis. The banks’ debts became “sovereign debt”, to be paid by workers and the poor through austerity.

Unions throughout Europe have rejected this. In Lisbon, the Portuguese capital, 300,000 people protested during a strike of public sector workers on March 4. In Greece, the first European country to suffer an International Monetary Fund “structural adjustment”, there have been five general strikes so far this year.

Spain has become the IMF’s next target.

On June 9, the Spanish government announced €15 billion worth of cuts from pensions, public sector wages and public services. Further cuts have been forshadowed.

The austerity page includes:

• raising the GST from 16% to 18% and the reduced rate GST, charged on expenses such as running water, from 7% to 8%;

• raising the official age of eligibility for pensions from 65 to 67;

• allowing employers to cut hours by up to 70%, without employees having recourse to redundancy or unemployment benefits;

• halving the required notice for firing permanent employees from 30 to 15 days;

• cutting redundancy payments;

• cutting public sector wages by 5%;

• paying substandard “youth wages” to anyone under the age of 24.

Government and business groups have coined a new term to justify such cuts: flexisecurity.

Nonetheless the Spanish Business Council president Jose Luis Feito told El Pais on June 12 that they were disappointed that the new laws do not go far enough.

“The lower the salary per person per hour, the greater the potential for increasing employment and productive capacity”, he said.

Spain’s treasurer, Carlos Ocana, told the press on June 15 that the unions are resisting reforms that are an economic necessity.

Yet while business and government have attempted to paint striking workers as sabotaging economic growth, the debate is not really about economic growth, but who this economic growth should serve.

The EU’s strict laws against government deficits greater than 3% blocks further government borrowing and stimulus spending on the scale employed by countries like Australia and China.

Furthermore, the panic instigated by financial speculation has closed off prospects for private Spanish companies to borrow, as happened in Greece.

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