The long-anticipated “hot autumn” begins as the European economy teeters on the edge of a largely self-inflicted stagflationary depression.
Last Friday (October 7), the 82-year old French writer Annie Ernaux won the Nobel Prize in Literature, for what the panel described as an “uncompromising” 50-year body of work exploring “a life marked by great disparities regarding gender, language and class”. A feminist and politically committed writer, Ernaux is the first French woman to win the award.
The news of her triumph was cause for celebrations, albeit brief, at the Élysée Palace, whose current resident, President Emmanuel Macron, tweeted:
“For 50 years, Annie Ernaux has written the novel of the collective and intimate memory of our country. Her voice is the voice of the freedom of women and forgotten figures of the century”.
Turning the “Knife” on Macron
Ernaux herself responded to the news by describing writing as a political act, a means of opening our eyes to social inequality. To that end, she uses language like “a knife”, to tear apart the veils of imagination. The next day (October 8), she turned that knife on Macron.
Ernaux’s name headed a list of 69 signatories to an open letter in the Journal du Dimanche calling for public support of an upcoming demonstration against Macron’s government, on October 16. Organisers of the demonstration accuse Macron of failing to tackle soaring prices of energy and other essentials while exploiting the ensuing crisis to obliterate what remains of the welfare state and social rights:
For many French people, fear of the end of the month is increasing. The bills are getting heavier. Receipts are skyrocketing. But salaries, pensions and welfare benefits are not rising, while the profits of some of the largest French firms are reaching new heights
This is the shock strategy: Emmanuel Macron seizes on inflation to widen the wealth gap and boost capital income, to the detriment of the rest. To let the prices of essential products and energy soar, and with them the profits of multinationals. To prevent any additional tax on those profits. While taking advantage of inflation so that real wages collapse. By refusing to compensate local authorities, the inevitable demolition of the public services they provide is guaranteed…
Neoliberals have been banging on for 40 years that there is no alternative. Do not let the heirs of Mr. Thatcher destroy hope, and liquidate our social rights. Another world is possible. Based on the satisfaction of human needs, within the limits of ecosystems. Freezing the prices of basic products and rents, increasing wages and social benefits across the board, setting the retirement age at 60, taxing superprofits, pouring massive investments into ecological bifurcation, transport and public services… Everything is only a matter of political will, and depends on our determination.
When it comes to mobilizing large numbers of people for political protests, the French can be pretty determined. Yet there was one word that was conspicuously missing from the open letter: sanctions. Which goes to show, once again, that well-meaning, left-leaning intellectuals are incapable or unwilling to confront the elephant in the room, Europe’s self-harming sanctions against Russia, even as they threaten to plunge the European economy into a deep depression.
Calls for Macron’s Resignation, NATO Withdrawal
Despite no longer having a majority in parliament, Macron is determined to push ahead with an ambitious program of reform, including highly controversial changes to both the benefits and pensions systems. This is one of the reasons for the recent upsurge in political protests, which have been steadfastly ignored in the mainstream press, both in France and abroad. Hardly a surprise given:
- The protests are still relatively small in size though growing in number. The gilets jaunes are still pretty active, it seems.
- The demands of some of the protests, including one in Paris this weekend, have included Macron’s resignation and France’s withdrawal from NATO. Given that France already left NATO’s military command structure once, back in 1966 when De Gaulle was president, this is not a totally idle threat. Needless to say, these are hardly the sorts of ideas the corporate media want circulating in their readers/viewers/listeners’ minds.
At the same time, fuel shortages are rapidly worsening across France as a nationwide strike by workers at TotalEnergies and Exxon refineries stretches into its third week. By Monday roughly a third of fuel stations in the countries were out of at least one fuel product. According to latest reports long queues are forming at gas stations in the Paris region as drivers wait for hours on end to fill up their tanks before yet more pumps run dry. The French people are quickly learning the importance of abundant energy.
This is happening because, as WSWS notes, refinery workers are calling for a 10% pay raise, pointing to inflation and the tens of billions of euros in “super-profits” generated by their employers:
Total refineries at Gonfreville-l’Orcher, La Mède, Feyzin, Donges and Grandpuits are affected, as are Exxon refineries at Notre Dame-de-Gravenchon and Fos. While strike actions at Donges and Grandpuits halted this weekend, it has continued in the other refineries.
Over 70 percent of refinery workers are participating in the strike, according to trade union figures. Striking workers at the Feyzin refinery emphasized the broad impact of the strike in their comments to the press: “There is no exit or entry of products in our entire refinery. This means 200 to 250 trucks per day, without counting barges and train cars, that are no longer entering or leaving the refinery.”’
Stagflation Beckons
The irony is that France has the third lowest inflation rate in Europe, at just 5.6%, behind Switzerland (3.3%) and Liechtenstein (3.5%). That compares to an EU average of 10% — the highest level since the single currency’s creation back in 1997. In Germany, where some of the government’s inflation subsidies recently expired, the official inflation rate surged in September to a 70-year high of 10%, from 7.8% in August.
On the European continent as a whole 27 out of 44 countries, including Russia, have inflation above 10%. In six of those (Latvia, Estonia, Lithuania, Ukraine Moldova and Turkey) it is above 20%. The three Baltic States, Estonia, Latvia and Lithuania, were the first EU Member States to cease all imports of Russian oil and gas, which they did in early April. Since then the countries’ already high inflation has more or less doubled.
Not only is inflation raging but economic activity is grinding to a standstill. Legions of small and medium sized businesses, still shouldering heavy debts after the lockdowns of 2020, are facing an existential crisis.
The UK is already in a full-year recession, says S&P, while inflation hovers just below 10%. The Euro Area is not officially in recession yet but the widely-watched European Sentix Investor Confidence index, which rates the single currency bloc’s six-month economic outlook, is signalling “a very deep recession” for the bloc. The overall index dropped to -38.3 points in October, the lowest level since May 2020, when the entire Euro Area was in lockdown. The expectations index also took a tumble to -41.0 from -37.0, hitting its lowest level since December 2008, three months after the collapse of Lehman Brothers.
Of greatest concern is the Euro Area’s largest economy, Germany, whose industrial backbone is massively dependent on cheap sources of abundant energy, which no longer exist thanks to the recent rupturing of Nordstream I and II.
“The former economic powerhouse is sinking deeper and deeper into the maelstrom of the energy-policy ghost train that the country has gotten itself into,” said Sentix CEO Manfred Hübner. “The current government, and especially the Minister of Economics, Habeck, do not seem to be up to the magnitude of the task.” As NC readers will appreciate, this is an understatement of incredible magnitude.
“Despite this miserable present,” said Hübner, expectations for the future are even worse, having hit an all-time low of -41.3 points. The punchline: “Politicians have already been relieved of their duties for less.”
Is it any wonder protests are on the rise across Europe?
Read the full article on Naked Capitalism
Nick Corbishley 