Global Spectator, by Andrés Ortega

A social Europe, protective but not protectionist

Esta entrada también está disponible en: Spanish

A social Europe, protective but not protectionist. Photo: HajjiBaba (own work) via Wikimedia Commons (CC BY-SA 4.0). Elcano Blog

Rally of the citizen’s initiative Pulse of Europe in Frankfurt, Germany. Photo: HajjiBaba (own work) via Wikimedia Commons (CC BY-SA 4.0).

Between the two rounds of the French presidential election, in which the debate about Europe was a central issue, the European Commission added its own not entirely coincidental contribution with its Reflection Paper on the Social Dimension of Europe. It has resurrected the idea of relaunching the social dimension as a way of reacting to the attacks from various populist quarters and the discontent in various parts of a European society unsure, as the Commission points out, as to whether the EU is the solution or the origin of its problems.

This is one of the five Reflection Papers the Commission plans to produce before the end of June, making the most of the lull in events prior to the German elections. The most recent, closely connected to the social question, deals with a ‘rules-based’ version of globalisation, namely open but with controls, which is going to change a great deal in the years ahead, and which has to take into account the problem of inequality and foster inclusive growth. The Commission has thus shifted, fine-tuning its stance on globalisation without falling into the trap of protectionism. It proposes boosting the European Globalisation Adjustment Fund, set up in 2007, aimed at helping workers who have lost their jobs because of global competition to find others. Over 10 years it has distributed €600 million in co-funding and helped almost 140,000 laid-off workers and 3,000 young ‘NEETs’ (not engaged in education, employment or training). A great deal more was needed and will be needed in the future.

Social mobility in the EU, after three generations that have benefited from it, albeit with major variations between countries, is now in doubt, as a recent Eurofound study points out. It has dawned on the Commission that the people who vote most for the populists and radicals on both the left and right are the youngsters aged between 18 and 34 who are going through a crisis of expectations.

Inequality, while it has grown more in some countries than in others, has also been a spur to these initiatives; this is in keeping with the tone of the commemorative Declaration of Rome on 25 March, which reiterated the call for a social Europe as a response to the challenges it faces. While it may have the highest level of social protection in the world, this is highly uneven between the member states, just as the rates of joblessness, average income and poverty are uneven.

Europeans (and the world in general) have changed a great deal in a century. Their life expectancy has increased from an average of 43 years in 1900 to 82 in 2050. As the Commission points out, most boys and girls born between now and 2025 will live beyond the age of 100, an undoubted advance, but one that creates new challenges in terms of jobs, employment and pensions. Owing to the technological revolution many situations have changed in the EU in the last 10 years. Whereas one out of every 14 Europeans used to be employed in teleworking, now it is one out of every six; the 33 million that once worked part-time now number 44 million; meanwhile the number of casual workers has risen from 18.5 to 22 million; and those active in the labour market aged between 55 and 64 from 16 to 32 million. The EU has not yet adapted to these changes, while the gulf between the winners and the losers from the new situation following the crisis, amid globalisation and the technological revolution, widens. Hence the interest in the debate that the Commission is trying to respond to.

By setting out potential alternatives for the future, rather than settling on one option over another, the Commission is acting more like a think tank than an institution responsible for generating policy proposals. In keeping with its White Paper on the Future of Europe, the Commission sets out three scenarios from which the social dimension will have to be chosen: (1) limiting the social dimension to the free circulation of workers; (2) the countries that want to do more in this area do more; and (3) that the EU27, in other words minus the UK, which opposed the development of a social Europe, deepen the social dimension together. The analysis of the pros and cons leads to the third option, that of a social Europe for all, because, among other advantages, it is the one that enables the most benefit to be obtained from the single market. Not everyone concurs, however. Some argue that certain advantages should be limited to the eurozone countries. Others even argue for limiting to a small subset of them, for example if a common unemployment insurance scheme is set up.

The new French President, the social-liberal Emmanuel Macron, seems to be leaning towards this version of social Europe, still to be finalised but not at all revolutionary, although it does not start from scratch. Indeed, France is experimenting with an innovative system of ‘personal accounts’ of points for such protection. The German Chancellor, Angela Merkel, is no great admirer of this social Europe, which her social democrat rival Martin Schulz half-heartedly endorses. Employers’ organisations have voiced alarm at the Commission’s proposals, which for the left fall a long way short.

Is it for the immediate or more distant future? There are already new problems the EU must address post-haste, something that also applies to globalisation. Examples include the proliferation of the self-employed (not multiple employment) in the gig economy (the name comes from jazz) of Uber drivers and multiple jobs. These self-employed workers’ social protection circumstances are highly varied and lead many to be vulnerable: unemployment insurance does not exist for them in 10 member states, is compulsory in 12 and voluntary in six. In another parallel proposal the Commission seeks to ‘ensure access to social protection for people in all types of employment’.

The goal is to erect a ‘European Pillar of Social Rights’, for which the Commission opened a round of consultations with employers and trade unions in 2016. It would be a social charter, going beyond the current one, that would eventually be incorporated into the treaties in such a way that everyone in the EU would be covered by basic standards. It is another of the seeds sown for the great European debate that, following the French election, will start once the German election in September is over. It remains to be seen what will emerge from it.

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