1. The ETUC and the Deep Recession Dublin, November 2009 rjanssen@etuc.org

2. Understanding the nature of this crisis This is not the usual downturn of the business cycle, not a ‘temporary’ phenomenon…. … it’s the economic model which has been pursued over the past decade(s) that is in deep trouble. ‘Casino capitalism’ or a model of double deregulation: –Financial market deregulation … –and labour market deregulation … –…as two sides of the same mirror

3. Share of 1% highest income earners in total income

4. Excessive household debt loads

5. The name of the game that is going on is debt deflation To summarize : ‘If we can’t increase wages, let’s increase debt’ (Greenspan). Two consequences of all of this: – We can no longer rely on (private sector) indebting itself to drive aggregate demand debt deflation –It’s even the opposite: Debt deflation is drawn out process and will drag down aggregate demand dynamics for several years to come.

6. The jobs crisis is still in front of us Huge loss of GDP (7%) Jobs losses would amount to 5% by end 2010 Lisbon Strategy put ten years back : It took more than ten years to build the knowledge sector (3 to 4% of all jobs) but only 2 years to destroy the same amount of jobs.

7. ETUC response :One central idea No return to business as usual No return to the same policies that got us into this mess Change the economic paradigm. New motors of demand instead of ‘bubble driven’ growth.

8. Promoting an understanding of the real causes of the crisis A set of ETUC ‘declarations’ –London declaration (October 2008) –Different Executive Committee resolutions –Policy demands of the European manifestations –New Social Deal proposed at the Mini Jobs Summit –Paris mid term conference and declaration

9. Proposing a different policy approach A sustained and ‘European’ relaunch of the economy : 1% of GDP over three years to invest in European projects Public and European money for public investment (Common Eurobond, backed up by the ECB). European solidarity to defend ourselves against continuing financial market irrationality (‘The IMF has no business in Europe’) (EU balance of payment fund/ EU budget). Organise distributive justice : EU adressing tax competition ( the real ‘ fiscal exit’ strategy).

10. The European Recovery Initiative in practice

11. Automatic stabilizers : Misleading

12. Proposing a different policy approach Common European principles for wages: Downwards floors in wage dynamics to prevent deflationary spirals. Strenghten the role and importance/coverage of collective bargaining. Europe for financial market reform.

13. Will wages resist (euro area level)?

14. Looking to forge a new social concensus Efforts to forge a joint ‘crisis’ declaration in the European Social Dialogue Failure to do so: –Imbalances or inequalities ? –Cutting social contributions at a moment we massively need the welfare state –‘Damaged trust’ : We can not afford not to be precise.

15. Joining up ranks Organise ourselves by mobilising the instrument of cordination of collective bargaining. Strict coordination guideline : ‘No to wage cuts or wage freezes’’ Exchange information between trade unions Going ‘public’

16. This has to end Goldman Sachs and its 20 billion bonuses: ‘We are doing Gods work’