It is amazing how history is revised when it is convenient. It is also amazing how the same events, that from my perspective are rather clear, can be diametrically interpreted by others, who want to run a different agenda. A good example of these phenomena can be found in a recent UK Guardian article (August 11, 2017) – Jacques Delors foresaw the perils of austerity. How we need his wisdom now. When I saw the headline I thought it must have been an article seeking to elicit some sort of deep irony. Jacques Delors – perils of austerity – wisdom – all in the same title. Ridiculous. Through the lens I view the work of Jacques Delors I can only see the abandonment of a progressive social vision, the unnecessary surrender to neoliberalism, and then, a bit later, as an inevitable consequence of these shifts – the disastrous and dysfunctional creation of the Eurozone with all its embedded and destructive austerity biases. The unfortunate fact is that the UK Guardian article was deadly serious. Oh dear!
Delors has been trying to reinvent his ‘image’ since the GFC exposed the failure of the original design of the Eurozone.
On December 2, 2011, the UK Telegraph published an interview with him – Jacques Delors interview: Euro would still be strong if it had been built to my plan.
No shrinking violet!
When the journalist asked whether he had got the Eurozone plans all wrong:
Unhesitatingly, he denies it. It is a fault in the execution, not of the architects, which he claimed to have pointed out in 1997 when the plans for introducing the euro finally came together. At the time, he says, the best of the eurosceptic economists, whom he refers to as “the Anglo-Saxons”, raised the simple objection that if you have an independent central bank, you must also have a state.
He claimed that the nations should have had a “common economic policies”, which as you will read is not what he argued in the lead up to Maastricht.
He also claimed in 2011 that:
There was also a problem of “surveillance”. The Council of Ministers should have made it its business to police the eurozone economies and make sure that the member states really were following the criteria of economic convergence.
And had they enforced the ‘rules’ that Delors and his cronies had created then the recessions in the early stages of the common currency – when France and Germany were in breach of the Stability and Growth Pact limits (2002, 2003 etc) – would have been much deeper and, in all probability, the common currency would have collapsed then and there.
It was not a problem of “surveillance”, but, rather, the rules that Delors introduced that meant the Member States were incapable of defending their economies from sharp contractions in non-government spending without their fiscal positions breaching the rules.
And then the Interview really went off the rails. He claimed that the problem that the GFC created was worsened by:
… a combination of the stubbornness of the Germanic idea of monetary control and the absence of a clear vision from all the other countries.
This “Germanic idea of monetary control” was, as I will argue, central to Delors’ embrace of austerity in 1983.
It was Delors, as French Economics, Finance, and Budget Minister who motivated the so-called ‘austerity turn’ while serving under President François Mitterrand, by seeking to impose German-type values (austerity, strong franc) onto French politics. More later on that.
And then the Interview seemed to ‘prove’ what Delors denied at the beginning.
When asked what the survival of the euro depended on, Delors replied:
… only if two conditions are met. “The first is that the firemen must put out the fire. The second is that there must be a new architecture. If you have one of these things without the other, the markets will be skeptical.
But earlier he had claimed the architecture – his plan – was fine – the problems were all in the way the Member States and Brussels had perverted his plan.
Vir: Bill Mitchell