Eurozone meltdown!


THE European Central Bank (ECB) monthly policy meeting took place in Naples last Thursday under riot conditions.

While Europe’s financial movers and shakers met in an opulent Renaissance palace in the Italian city, over 4,000 workers and students were fighting it out with riot police who used water cannon and tear gas to disperse the anti-austerity protesters and prevent them from climbing the palace walls and physically getting their hands on the representatives of the ECB.

Similar mass protests took place throughout Italy to coincide with the meeting, with violent clashes with police reported in Milan, Rome and Turin as hundreds of thousands of workers and youth turned out demanding ‘No to the ECB, no to austerity – housing and income for all’.

With 56% youth unemployment in the region, the mood amongst workers and young people is insurrectionary – a mood that is mirrored across the whole of Europe with Spain facing similar levels of unemployment for youth between ages 16 and 25 and Greece a massive 58%.

Driving unemployment up are the savage austerity measures imposed on the working class across the eurozone by the troika of the EC, ECB and IMF under the banner of ‘structural reform’ of the economies of the zone.

The immense problem for the troika is that these structural reforms – a euphemism for mass privatisation, unemployment and welfare cuts – has run into the massive opposition of a working class refusing to accept poverty as the price for keeping European capitalism going.

Countries like France, Spain and Italy have found it increasingly impossible to implement the structural reforms demanded by the troika out of fear of the revolutionary implications.

This crisis is causing splits and divisions between the bourgeois political parties and within the ECB itself.

The biggest split to emerge at last Thursday’s meeting was between Germany and the head of the ECB, Mario Draghi, over his plans to launch a eurozone Quantitative Easing programme.

Draghi hinted months ago that the ECB would print one trillion euros worth of free money to hand to the banks in order to kick-start the eurozone economies.

This act of desperation to try and revive the hopelessly bankrupt industries of Europe was greeted with delight by the international financiers who saw it as keeping up the supply of free money at a time when the US was trying to cut back its own QE programme.

Unfortunately for Draghi, his scheme was scuttled by the Germans furious at any attempt to print worthless currency in order to stave off financial crisis.

With their long bitter memories of the 1920s and 30s where printing valueless money led to hyper-inflation and economic collapse, German economists and politicians denounced the move as ‘money debauchery’, forcing Draghi to back-peddle furiously.

The German position is that there must be no retreat from austerity, it has to be ramped up across Europe regardless of the revolutionary consequences.

This section of the capitalist class, with the benefit of historical experience, is conscious that all the financial weapons in the capitalist armoury, from zero interest rates to QE, are not going to solve the greatest crisis in the history of capitalism.

Their only solution is to make the working class in every country pay for the bankers crisis by driving them into the ground through unemployment, starvation level wages and ending all public and welfare services.

This means war against a powerful working class held back only by its rotten reformist and Stalinist leadership in the unions working night and day to keep the mass movement within the confines of protest.

Despite these betrayals and all the repressive forces of the capitalist state the mass movement of workers and youth is developing at speed.

What this mass movement requires above all else is a conscious revolutionary leadership to take it beyond protest to taking the power; to overthrowing capitalism and going forward to the united socialist states of Europe as part of the world socialist revolution.

It demands the building of sections of the Fourth International in every country.