Let me start by congratulating the Commission for having streamlined the semester process and refocused the country specific recommendations, not least by reducing their number and concentrating their thrust.
In its report, the Commission starts by noting that “growth is returning to the EU” but says that developments leading to it are largely short term.
This reminds me of the IMF’s verdict regarding how competitiveness is being regained in Europe.
It is being done mainly through a reduction in unit labour costs that is greatly dependent on shedding of labour.
Indeed, we all are aware of how fragile the current recovery remains.
Meanwhile, the past and present reliance on so-called structural reforms to bring about so-called flexibility in labour markets has had serious social consequences.
Beyond the effects of recession, it has cut on living standards.
It has injected insecurity in to the lives of millions, young and old.
It has failed to reduce unemployment significantly, not least beacuase it has helped to depress demand.
Ultimately, the verdict about what we are doing is not given by the markets, but by voters.
Beyond the concerns about immigration, recent election results in Italy, Spain, France and Denmark show voters are less than impressed by Europe’s economic outturn.
Unfortunately, our assessments do not focus enough on the divergences that are increasing.
Many citizens are experiencing them in their daily lives: divergences between regions within the Union, such as north and south. Precarious work practices such as low pay, job insecurity, lack of access to social security and training are still a reality in many Member States.
Sometimes even in these country specific recommendations, we seem to be confusing economic policy coordination and convergence, with convergence in terms of economic performance.
Policy convergence as of now may be premature and harmful given the existing divergences.
We cannot leave people with the impression that instead of managing markets, Europe is being managed by markets.
Would the recovery have been less fragile if the current dogma about fiscal consolidation were bent sufficiently to allow for social repair in the communities that have been worst affected by the crisis and the subsequent “reforms”?

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