Europe’s ‘crisis after the crisis’ poses uncertainty in 2014
14 Dec 2013
The question was asked by one of Greece’s most respected newspapers as another year of painful austerity drew to a close.
If public anger does explode on the streets, wrote Kathimerini, it will not be provoked by politicians or labour unions, but come from ordinary people who “never imagined themselves doing such a thing”.
Desperation is weighing not just on Greece, but on countries across Europe facing the same paradox: despite the end of the Great Recession, people continue to struggle with the daily reality of unemployment and poverty.
Greece, Italy and Portugal are forecast to return to growth next year, while Spain has already emerged from recession and Ireland has ended its bailout programme.
But the disconnect between economic data and quality of life is fuelling populism, rightwing extremism and anti-European sentiment — and is likely to play a big part in European Parliament elections in May.
“An improvement? We see no improvement, and will not for quite some time,” said Manuel Moreno, a 34-year-old who just lost his job at a humanitarian organisation in Madrid.
The European Union flag is seen with the statue of Irish trade union leader James Larkin in Dublin on December 11, 2013
“It took 15 years for things to improve after the 1990 economic crisis. This time round, the situation is much worse. We could see no recovery for 20 to 25 years,” he said.
Yet according to the figures, Spain is already doing better.
In 2012, its banks needed 41.3 billion euros ($56 billion) from the European Union, European Central Bank and International Monetary Fund — the so-called “troika” — to save them after the collapse of a real-estate bubble. Last November, the government announced it would exit the rescue programme at the beginning of the year.
The Spanish economy came out of recession in the third quarter of 2013, and the government is predicting 0.7-percent growth in 2014.
Nevertheless, the jobless rate in Spain, where more than one in four are officially out of work, is not expected to fall before 2015, according to the European Commission.
A woman takes part in a demonstration with the slogan “stop antisocial budgets” in Barcelona on November 24, 2013
It’s a similar story in Ireland, another of Europe’s ailing children in 2010, which entered an 85-billion-euro ($115-billion) bailout that year but announced last November it would exit the programme in December.