European workers defend the welfare state

By William Pomeroy, People's Weekly World, 26 October 1996

Trade unions across Europe have pledged a hot autumn of strikes and demonstrations for governments out to slash welfare state spending and for employers taking advantage of such policies to drive down workers' wages and benefits.

Precipitating the present class battles in Europe is the decision by European Union members, formalized in the Maastricht Treaty, to launch a single European currency, to be known as the euro, on January 1, 1999. To qualify for participation in the single currency, however, a member state is required by the Treaty to bring budget deficits down to 3 percent or less of annual gross domestic product. Almost all EU members, especially the larger countries, have run deficits far above this.

To meet the European Monetary Union (single currency) deadline, with only two budgets to go, EU governments are engaging in a near-desperate rush to cut public spending. The axes are being swung not upon bloated military spending but upon the budgetary items of social welfare, benefit payments to the needy, and income support for the unemployed which those of wealth and property have long hated to contribute to and have wanted to eliminate. The EMU looks increasingly like an excuse for restoring the good old days of unrestrained, unreformed capitalism.

Last November 1995 the Chirac government in France sought to rush through cuts in this year's budget by hitting public sector workers with a wage freeze, social security cuts and pruning of jobs. It brought widespread strikes by rail workers, teachers and civil service employees, causing near- chaos, which forced the government to retreat.

This year the Chirac government has returned to its drive for cuts in disregard of the warnings of struggle that have been building up among workers for months. It is occurring at a time when the French economy is on a downward slide, with growth at a standstill and unemployment at a record rate of 12.6 percent (over 3.4 million).

Gradual unveiling of the 1997 budget has shown public sector jobs to be a principal target for reducing the deficit. Over 6,000 jobs are set to be cut, chiefly in the education system. On Sept. 30 the five main teaching unions, representing 900,000 staff and disunited in the past, coordinated with a national walkout, demanding an end to austerity measures; they were backed by students, who joined them.

On Sept. 23 the seven main public sector unions, speaking for four million public employees, called for a 24-hour general strike on Oct. 17, demanding wage rises instead of wage freezes and spending on job creation instead of job cuts (see story, previous page).

Extensive as it is, French resistance to the price in jobs, wages and social security being exacted for entry to the European Monetary Union is being exceeded in Germany, where the trade unions are up in arms against even more savage cuts by the government of Chancellor Helmut Kohl.

The Kohl regime rammed through the lower house of the Bundestag on Sept. 13 a set of laws that tear large holes in the welfare state gains made over decades by German workers. Mass opposition caused the upper house of the Bundestag to veto the legislation; the lower house approved it but only through desperate steps by Kohl to drag MPs from hospital beds and trips abroad to get his majority vote.

Most contentious at the moment is the reduction of sick pay. In 1957 the huge engineering and metal workers union, IG Metall, in a 16-week strike, had won the general right for sick workers to receive 100 percent of their wages in sick pay. Kohl's new law cuts this to 80 percent. The unions refuse to abide by it.

The situation was inflamed by the unilateral action of major engineering and chemical companies, headed by Daimler-Benz and Siemens along with some of the car companies including the subsidiaries of Ford and General Motors (Opel), which hurried within days to impose the sick pay cut. It brought an immediate strike by 100,000 workers, shutting down most of the car industry. Said Klaus Zwickel, the president of IG Metall which called the strike, The employers have stepped on a land mine on the sick pay question.