It’s time to loosen the grip of austerity

The eurozone will face another year of recession with a 0,3% drop of GDP in 2013 and a new surge in unemployment – from 11,4% to 12,2% – according to the forecasts presented today by the European Commission.

Said S&D Group leader Hannes Swoboda:

„These forecasts did not come as a surprise. Last October an independent report commissioned by the S&D Group had already rightly predicted that the Commission’s previous forecasts were over-optimistic.

„The current austerity policies are simply unrealistic, harmful and inefficient.

„They are weakening the European economy and pushing many countries that are unable to respect their reduction deficits targets into deeper recession.

„With thousands of people in the streets across Europe to protest against austerity, the time has come to loosen its grip.

„We appreciate that the European Commission is acknowledging the mistakes in its strategy and we welcome its readiness to give more time to some EU countries such as France, Portugal and Spain to reduce their debts and deficits.

„Adding a new dose of austerity in countries already in recession or facing no growth would simply make things worse.

„The new rules adopted to enhance fiscal discipline inside the eurozone could mean sanctions are triggered for these governments almost automatically.

„It is a relief that the European Commission is not rushing to punish member states. We welcome this change but what we need now are co-ordinated measures to boost public and private investment.

„The Socialists and Democrats strongly believe that all EU countries should be committed to reducing public debts and deficits. But Europe needs a better balance to stimulate growth and job creation.“

Note to editors:

On 7 March 2013, the Progressive Economy initiative will be officially launched at a major event held at the European Parliament in Brussels . This is a joint initiative from the S&D Group in the European Parliament and the Foundation for European Progressive Studies (FEPS).

A one-day conference entitled ‚Failed austerity in Europe – the way out‘ will bring together leading speakers from politics, academia, trade unions and the media.

Speakers at the conference will include French finance minister Pierre Moscovici, Luxembourg’s minister for labour Nicolas Schmit,the deputy secretary general and chief economist of the OECD, Pier Carlo Padoan, internationally renowned economists such as Professor James K. Galbraith from the USA, Professor Jean-Paul Fitoussi from Paris and Professor Dr. Gustav Horn from Germany, as well as the secretary general of the European Trade Union Confederation, Bernadette Ségol, alongside leading members of the S&D Group in the European Parliament.

S&D Group leader Hannes Swoboda will hold a debate on how progressive forces can win the current battle of ideas in the economic and social field with leading politicians, including Alfredo Pérez Rubalcaba, secretary general of the Spanish Socialist Party (PSOE) and Massimo d’Alema, president of the Foundation for European Progressive Studies (FEPS) and former Italian prime minister.

Full details on the initiative are available here: www.progressiveeconomy.eu