Why solidarity and austerity are close (and not oppositional) friends in the Euro crisis discourse
It seems that the Euro crisis is over. Greece left the bailout program in Summer 2018 and Ireland and Portugal have generated economic growth (for different reasons). Studies on the Euro crisis argued, most notably among others Mark Blyth, that austerity was the only game in town that mattered in the Euro crisis. Structural reforms, severe cuts in the social sector, strict conditionality and supervision of the national budget by the Troika/Institutions (European Commission, European Central Bank, International Monetary Bank) predominately shaped the Euro crisis politics.
These austerity politics in the Euro crisis created a strong divide between creditor and debtor states. Germany and Ireland are two examples of these different positions. Germany had a hegemonic role in the Euro crisis as biggest creditor and largest economy in the EU. Ireland, on the other hand, was well performing just before the crisis. It had a low debt rate and booming (FDI-oriented) economy, but as Jones et al (2016) summarise the Irish situation in the crisis: ‘The Irish bank bailout [in 2008] eventually shifted more than €62 billion bank liabilities onto the shoulders of Irish taxpayers, turning a state that had been a model of fiscal rectitude into a massive debtor that had to turn to the EU and IMF for a bailout’.
This constellation in the Euro crisis can be understood as a conflict about solidarity and who is showing solidarity with whom and why. In fact, previous studies demonstrate that solidarity and austerity are oppositional frames in parliamentary debates and solidarity is predominantly claimed by the parliamentary opposition and leftist parties such as Die Linke in Germany.
However, I show in a recent study that this perspective overlooks the discursive linkage of austerity and solidarity claims in the public discourse. Solidarity can be reinterpreted through the lens of austerity to justify the dominant paradigm. Based on a discourse network methodology in which actors and frames are manually coded in German and Irish quality newspapers from 2010 to 2015, I present three crucial insights into the solidarity discourse of the Euro crisis.
First, the German discourse strongly focuses on the solidarity-austerity-nexus. The demand to have a balanced national budget, reducing national debt and fulfilling the criteria of the Troika is the central nodal point in the debate, but it is accompanied by the solidarity claim. For example, the German chancellor Angela Merkel argues in her speech at the World Economic Forum in Davos in 2011 the following:
‘The level of debt is the biggest threat to the prosperity of our continent…There has been great solidarity for some countries in the last months, but this is just one side of the coin…Solidarity has to be coupled with solidity and stability’, claimed Merkel. It’s the only way to save the Euro’.
Solidarity is shown, but only if the crisis countries follow the Troika rules and reduce debt. In this context, it is crucial to note that the German word for debt, Schuld, has two meanings: ‘debt’ as financial term and the more moralistic term ‘guilt’. Hence, the crisis countries (Greece, Ireland, Portugal, Spain) should not only reduce their national debt, but also have to admit that they did something wrong. In order to receive solidarity from the creditor countries, they have to show an effort to do better. In this regard, the offer to act in solidarity becomes a crucial legitimation to demand austerity in the first place.
Second, the Irish discourse is less centred on austerity and instead emphasises responsibility as necessary action for solidarity. The claim for responsibility refers to two levels: On the first level, it is the call for responsible and solidary actions of financial managers and bankers who should act more morally and appreciate the bailout from the Irish state (Ireland saved the six biggest Irish banks with a bailout of 64 billion Euro in 2008). The following statement by former president of the European Commission José Manuel Barroso demonstrates this discursive coupling of responsibility and solidarity, arguing that the financial sector must make a fair contribution to cover the costs that financiers have shifted on to taxpayers:
‘The financial sector has benefited from a lot of solidarity, and it is time to return the favour by showing great responsibility.’ (José Manuel Barroso, Irish Times, September 2010)
On the second level, Irish politicians claim that the Troika should demonstrate responsibility by easing the financial burden of the economic adjustment program for Ireland. Irish actors argue that the Irish bailout prevented not only the collapse of the Irish banking system, but also stopped a further contagion effect for the whole European banking system. Hence, they claim that the European Commission, the European Central Bank and Germany should show solidarity with Ireland.
Third, the most central actors in the German and Irish discourse are German (conservative) politicians. While it is less surprising that German party actors dominate the German public discourse, accompanied by EU actors such as the presidents of the European Commission Barroso and Jean-Claude Juncker, the strong presence of German party actors in the Irish discourse underlines the central position of Germany in the Euro crisis. Merkel or German Federal Minister of Finance Wolfgang Schäuble are regularly quoted in Irish newspapers alongside key Irish politicians such as Irish Prime Ministers (Taoiseach) Brian Cowen and Enda Kenny.
Consequently, the austerity paradigm was and still is so dominant, because it was linked with calls to solidarity in the German discourse while the responsibility frame occupied a central position in the Irish public discourse. Moreover, any solidary policy proposal such as a transfer union or the introduction of Euro bonds failed due to the missing discursive unity of the opposition as well as the strong presence of conservative parties in national governments across the EU and in the European Council.
Coming back to Greece leaving the program, the tweet by European Council president Donald Tusk in reaction to the end of the bailout program in Greece in 2018 is prototypical for this, still valid, discursive link of austerity and solidarity: ‘You did it! Congratulations to Greece and its people on ending the programme of financial assistance. With huge efforts and European solidarity you seized the day’.
To sum up, two important lessons can be learned from this study: First, solidarity claims are not reserved for leftist (party) actors, even though solidarity is inscribed as a crucial idea in the labour movement, social democratic parties and progressive transnational social movements. Instead, solidarity is linked to other frames in the discourse and is strategically deployed by national executives to justify their political actions and mobilise the public. Second, the conflict about solidarity in times of crisis vividly demonstrates the conflict about the future of the European Union. An alternative to the austerity paradigm should not just rest on a vague idea of a ‘Social Europe’, but must articulate a policy proposal to which many actors can link their ideas in order to influence the public discourse. Considering the upcoming elections to the European parliament this week (23rd May), this task is more important than ever.