Rather a systemic crisis

These European citizens remind us of a forgotten plain truth: The economy exists for the people, not the other way around. The problem which began as a debt crisis, then turned into a continental financial crisis, is in fact a crisis of the entire system. And in the terms of French philosopher Edgar Morin, a crisis of civilization. Despite this, politicians and key decision makers all over the world continue to perceive it as a simple matter of financial engineering.

The most telling example of such a state of mind is the so-called “Fiscal Compact,” or the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union. It was signed but not yet ratified by 25 European Union member countries. The essence of this ostentatious treaty is an assumption of a magic formula to solve the crisis: To cut back public spending in saturated economies of “elderly” European countries that are unable to collect sufficient taxes as there is no more growth potential, and where unemployment has become structural and is only fated to rise. In other words, in a continent where social security nets are broken, where people are being thrown out onto the streets, where the masses of unemployed are swelling and where people are compelled to do with less, the global paradigm continues to order a financial equilibrium at the expense of citizens.

And since Europe is nothing like China or Turkey, and since these displeased masses have the tradition of rising to protest, they use the last weapon they hold in their hands, the voter ballot, as much as they can and as far as it goes. If today in Europe the most “financially” successful politician could lose her position through an election, it means the problem is elsewhere. Indeed, since March 2011, Angela Merkel has lost three major elections in three Länder (German states). If elections were to be held today in Spain, newly elected Prime Minister Mariano Rajoy would have a difficult time protecting his seat. As for newly elected French President François Hollande, he has no miracle solutions in hand either -- and the elections were less about his victory than his challenger Nicolas Sarkozy’s loss.

Of course, Keynesian policies to encourage growth or neoliberal dogmas like increased productivity and structural reforms need to be tried. For example, the Greek left is requesting that the European Central Bank instead of lending only to banks -- in line with the neoliberal dogma -- lends to governments as well. It is not a foolish request. Similarly, the European Commission is proposing large projects aimed at energy saving, public infrastructure and technologies of the future. It is proposed that these large projects be funded by the European Investment Bank and other European financial institutions through a new instrument, the “project bonds.”

But leaving aside finance and economics, the essential problem is rooted in a deep existential crisis in which all economic doctrines are challenged. Within this framework, even though Greece may appear to be a marginal case, the continent’s daily agenda now consists of a constant state of opposition and uprising as well as a dangerous search for scapegoats. The lack of viable perspectives generates a continent-wide alienation and nihilism.

The very paradigm of unimpeded “progress” that has been envisioned, implemented and imposed by Europe on the rest of the world is now collapsing across the continent, and in all developed countries. And the next collapse will be that of those developing countries which have foolishly followed them. Behind the collapse is the veneration of the unlimited life of the “progress” and the blind belief in the system’s ability to renovate itself. Alas, the reality is different: As a consequence of the hedonistic consumerism which constantly feeds itself, all humane and environmental equilibriums are currently facing a permanent exhaustion.

Now would you go for the German Bund or the Spanish bono?