by Keith Richmond
EUROPE’S trade union leaders have issued a hard-hitting call for government and European Union action to put an end to the uncertainty created by the “greed is good” culture at the heart of the financial world.
After another week of financial turmoil, the European Trade Union Confederation, under general secretary John Monks, issued its London Declaration on the crisis of casino capitalism.
The declaration, sent to the President of the European Commission, the President of the European Central Bank, the Commissioner for Economic Affairs and the finance minister of every member state, says: “The world financial crisis must be a turning point and cause a complete change in the way the financial world works. The dominant model of financial capitalism is close to collapse. This capitalism, liberated from long-standing restraints around 25 years ago, especially in the USA, has been used since as a role model for the rest of the world to follow.
“It has patronised the many while it exploited them for the benefit of the few, following years of privatisation, deregulation and unfettered markets. Now its excesses have brought it close to ruin – and it threatens the real economy. Indeed, Europe’s economy lives in fear of being hit by a financial tsunami speeding across the Atlantic despite the relative strength, so far, of the euro area.
“The US government is scrambling together hundreds of billions of dollars to save key banks from their own folly; the credit crunch is strangling finance for industry as banks hoard money to protect themselves. Recession looms.
“Let us be absolutely clear. This crisis was caused by greed and recklessness in Wall Street, London and other major financial centres. Senior executives permitted speculation on a huge scale on investments they ill understood. Speculators have exacerbated serious rises in the price of fuel, food and raw materials. The losers include workers, pensioners, families, firms seeking investment capital and taxpayers bailing out banks.
“The costs are huge and it will take years to recover the money, if ever we do, and our future ability to fund high-quality public services is being placed in jeopardy.”
That, says the ETUC, is why this must be a turning point. Never again should the irresponsibility of banks and hedge funds be allowed to come close to bankrupting nations. And never again should taxpayers’ money be used to prop up institutions which continue to pay enormous salaries and bonuses to their top executives.
The ETUC wants much tighter control of financial institutions’ ability to leverage their operations; effective international regulation; government action to ensure funds are available for investment in the real economy; and help for workers affected, householders threatened by eviction, and pensioners threatened with poverty in old age.
The declaration ends: “The ETUC calls on Europe to fight for workers’ rights, for fair and decent wages, for stable jobs and for strong collective bargaining practice, independent of and not subordinated to law courts and judges.”
