NewsJune14  BEF

Brussels Economic Forum 2018: refreshingly social

The 2018 edition of the Brussels Economic Forum, organized by DG ECFIN of the European Commission on the 5th of June, finally tackled many issues that are at the heart of COFACE-Families Europe’s work: social inclusion, poverty, inequalities and gender equality. More time was dedicated to key societal questions rather than very technical and technocratic topics, throwing around complex jargon from the latest decades of wild financialization of the global economic and financial system.

Womenomics

The event started with a morning session on “womenomics”, examining the gender dimension in economics. The panel kicked off by underlining the difficulty to accurately measure the economic value of work, especially work mostly carried out by women such as elderly care. Adding such value in the traditional economic indicators would greatly help in recognising the positive contribution this work has on the economy. Other indicators have also been missing, such as the notion of “public good” or “public value” which we have to re-explore. Public health, for instance, is a service that we often underestimate, in terms of its positive impact on an economy. Economics, which has gradually become a more “technical” field, needs to rekindle with the social concerns of citizens. In that respect, more women in economics can help achieve such a goal, given that women economists are more “progressive” and sensitive to social concerns then men, killing two flies with one swat: achieve greater gender equality in economics and bringing back social concerns in economics.

The future of work

Quoting EU Commission President Jean Claude Juncker, making it clear that economics should work in the interest of citizens and should incorporate social concerns: “The role of economics should be protection and progress for European citizens. “I expect further progress in the months to come on our proposals on fair and transparent working conditions and on work-life balance, as well as on our proposal for a new European Labour Authority which will improve information on rights and obligations across borders”, he said.

Several key note speeches focused on “upskilling” all EU citizens, in order to help them prepare for the transition from low skill to high skill labour. This however isn’t sufficient. As one panelist from the following panel underlined, you won’t transform all taxi drivers into application developers or experts in artificial intelligence.

While economist Robert J Gordon does not believe that automation can truly displace many jobs and that most of the productivity gains from the “third industrial revolution” have already happened, Jeremy Rifkin does see advances in key sectors and notably the sectors of energy and transportation. Decentralizing energy production and transforming the transport industry from an individual good (owning one’s car) to a service will have a major impact on our societies. He also calls on rethinking economic indicators to take account of “quality of life” and sustainability (what he called regenerability) in order to better account for a sustainable long term growth. Jeremy Rifkin also mentioned worker owned cooperatives as key to a healthy economic development for the larger benefit of society.

Panelist Sharan Burrow (ITUC) and Winnie Byanyima (Oxfam) focused on the elephant in the room: tackling inequalities, precarious jobs, low wages, and redistributing profits fairly so that people are able to afford the goods/services they produce.

Winnie Byanyima followed by further underlining key issues faced by ordinary citizens. Governments are too obsessed with growth, GDP, and not how the lives of people are improving. Businesses maximize profits for the few (shareholders) and not the many. Governments need to use public ownership as well in order to deliver key goods/services to citizens (since major companies benefited from public research). Ordinary people are carrying all the burden of taxation, we need to make sure that big companies pay their fair share.

Completing the EMU (Economic and Monetary Union)

The conference ended with the progress in achieving an Economic and Monetary Union, notably to ensure that all EU businesses and citizens enjoy similar conditions to access finance and secure funding.

As Ana Botin, Executive Chairman, Banco Santander, mentioned in her speech, businesses some Member States like Germany enjoy much better conditions in their access to finance then businesses in other Member States like Greece. If a business has to pay much higher interest rates in a country compared to another, although their activity and risk is similar, that creates market distortions and harms the economic development of some Member States, contributing to widen the “gap” between Northern Europe and Southern Europe and Western Europe and Easter Europe.

However, the road is long, as MEP Philippe Lamberts reminded the audience. 10 years after the financial crisis, we don’t have a financial restructuring mechanism. The threat of a major crisis might get some Members of the Eurozone affected to make progress. We need a banking union, but so far we don’t see it advancing. On the contrary, the current system consists of a “beggar thy neighbour” policy, social competition, mercantilism and tax competition. The change of policies at EU level has to address macro economic policies and the guiding indicator should be the level of inequalities. What needs to change is another political majority, without necessarily a lengthy and complex institutional reform.

For more information about the event, visit the official website here or contact COFACE policy and Advocacy manager Martin Schmalzried: mschmalzried@coface-eu.org