"... what we have just witnessed is truly a new stage in the construction of Europe... " (Photo: McGraw Hill)
The Bank Rescue Plan
For years, we've said - to no avail - that we lacked economic governance. Up until yesterday, Europe was the only system in which the central bank had no facing political authority. For too long, deregulation ideologues had the upper hand to such an extent the market was considered a sort of sui generis phenomenon that self-regulated, thanks to the invisible hand so dear to Adam Smith. In the period of Euro-skepticism we are living through, one might fear the worst. And the opposite took place, confirming the hypothesis of those who never stopped thinking that Europe had always created itself in the crucible of crisis. We even saw the initiative for this plan revert - not to Nicolas Sarkozy - but to Gordon Brown, the champion of Anglo-Saxon free market social neo-liberalism! Even though the term is not formally pronounced, what we have just witnessed is truly a new stage in the construction of Europe, even up to the simultaneous announcement of the refinancing plan in each European country. For Nicolas Sarkozy, "by offering the government's guarantee, we may hope to put an end to the crisis of confidence."
Even though these combined efforts had an immediate impact on the markets, some questions remain. The deepening of the debt that our children will pay. After the bounced check, the risk of the blank check. The summit makes provision for an overhaul of accounting norms and calls for another summit to rewrite international finance regulation. If that's a serious commitment, it will be necessary to destroy the dangerous "stowaways" - the tax havens that harbor the world's most opaque investment funds. But on this subject, can one limit oneself to demanding, as does Sègolëne Royal, the prohibition of tax havens - which amounts, in a way, to demanding the abolition of world hunger? Last question: It's not enough for the markets to go back up, we must concern ourselves with the "real," economy, with companies. As the president of the UIMM [Union of Metal Industries and Professions] noted yesterday, "we are experiencing a rapid drop in recourse to interim labor and an increase in pa rtial unemployment." And, of course, a strong resurgence in the number of unemployed. We are far from the end of our suffering, but a page has been turned - that of a certain despotic hyper-free-market neo-liberalism.