Last week Gallup published a poll highlighting the broad disapproval throughout the European Union on the use of strict austerity measures to solve the economic crisis that has persisted since 2008, stating that they believe there are better alternatives. The poll of 6,177 EU citizens revealed that an average of 60 percent of Europeans want the EU to look into alternate methods of reducing the financial deficit and promote economic activity; as one would suppose, these statistics are even higher in countries that have been greatly affected by the crisis, such as Greece, Portugal, and Spain.
The Commission defines austerity as measures taken by a state to reduce spending and increase parsimony in order to deflate their growing budgetary deficit, which are often put into practice by heightening taxes as well as cutting state benefits and jobs. The strict measures that have been imposed on many countries’ budgets have contributed to some economic progress, as the Eurozone’s combined deficit as fallen from 4.2 percent in 2011 to 3.7 percent in 2012. Yet, 51 percent of European citizens still believe the austerity policies have not adequately fought the financial crisis. The persisting unpopularity of such policies since their implementation may be a sign that they have reached their “natural limits”, states Commission president José Barroso, suggesting that it may be time to apply new techniques to the situation.
The Commission is taking steps toward complementing the budget consolidation efforts with social improvements, as they adopted a Communication on strengthening the social aspect of the Economic and Monetary Union today in order to aid in the achievement of the Europe 2020 goals of smart, sustainable, and inclusive growth. Specifically, inclusive growth works to foster an economy with high employment rates that runs cohesively as a social, economic, and territorial unit; however, the EU28 average unemployment rate has risen from 10.6 to 10.9 percent in the past year.
By providing a social answer to the financial crisis, the Commission hopes to make it clear to EU citizens that there will be better economic times in the future. In November of 2012, the Commission outlined a blueprint for the Economic and Monetary Union’s next ten years, emphasizing the need for deeper integration within the EMU. Strengthening the social element of the EMU by means of stressing the important role of social dialogue surrounding the harmonization of employment and social policies between Member States is necessary for the completion of this goal. The ability to handle the social repercussions of any economic reforms is crucial to the well being of the EMU.
The Commission plans to achieve this goal by developing a scoreboard of vital employment and social signs that reflect the health of the EMU, including unemployment rates, youth unemployment and the rate of those not in education, employment, or training (NEET rate), household disposable income, the at-risk-of-poverty rate, and inequalities. By examining these factors on a regular basis, the EU will be able to closely gauge the effects of economic policies on the social level, leading to greater coordination between the two arenas. Moreover, it will enable the EU to provide unique guidance to each Member State regarding the best measures to take to address their specific employment and social challenges.
Although public dissatisfaction with the social effects of the current austerity measures was once again made apparent by the Gallup poll released last Wednesday, the Commission is taking the necessary steps to ensure that future social and economic policies complement one another as Europe moves out of the financial crisis and looks toward its 2020 goals.