João Paulo Batalha – Austerity hardwired into the EU: Mired in strikes, is Portugal’s anti-austerity oasis nothing but a mirage?

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Portugal has been hailed as proof that anti-austertiy state finances are possible in the EU. As João Paulo Batalha writes, three years on, Portugal’s left wing Government, billed across Europe as the antidote against the spread of populism and the far-right, seems to be stuck on the same austerity dead end that’s been unravelling establishment politics across the continent.

You can also read João’s earlier article, describing how the Portuguese government’s  “anti-austerity” financial policy contained a great deal of sleight of hand here

João Paulo Batalha is a social activist and founding member of Transparency International Portugal

Doctors and nurses drive wave of strikes set to hit Portugal

‘Tis the season to be striking. December is turning out to be a cold month for António Costa, the centre-left Portuguese prime minister who governs with support from a parliamentary coalition with the orthodox Communist Party and the Left Bloc, a party cobbled together in the late 1990’s from a mix of Maoist and Trotskyist movements. A wave of strikes has contributed to pushing Costa’s approval numbers below 50% for the first time since he took office in late 2015. Perhaps more bitter for a prime minister who will be fighting to secure an absolute majority for his party in parliamentary elections taking place in 10 months, the only party leaders with higher approval ratings are his “frenemies” at the Communist and Left Bloc parties.

According to the Government’s own numbers, 518 strikes had been called in the first ten months of 2018. Train strikes have become routine, with commuters and their employers losing count of productivity costs due to delays or absences caused by seemingly permanent conflict over a crumbling railway infrastructure. Just this month, the head of the public train company’s equipment division was sacked after protesting against the company’s decision to delay much needed maintenance on train locomotives and carriages due to budget constraints – a decision he claims endangers the safety of passengers. Aside from railway workers, in December alone strikes in supermarkets, school cafeterias, call centres and public registry offices, among others, contributed to a steady wave of protest. Even workers at the State owned TV and radio service went on strike last week, demanding permanent contracts to staffers working on temporary status, often for years. Teachers, tax inspectors, prison guards have been striking. Investigative officers in the Judicial Police and public prosecutors have also called for strikes early next year, concerned with chronic budget cuts and pushes to limit the autonomy of the judiciary in its fight against political corruption.

But the two most eloquent protests in this late-2018 came from public hospital nurses and from the workers in the port of Setúbal, 50 kilometres south of Lisbon. And both strikes signal something important about the true conditions in supposedly “post-austerity Portugal” – and where they are going.

In Setúbal, dock workers went on strike for over a month, demanding permanent contracts with port managers. Shocking as it was, 90% of the employees in that crucial infrastructure were hired for the duration of their shift each day and fired when the shift was over. Some lived in this precarious situation for over 20 years. The daily contract means no steady job, no guarantee of employment from one day to the next, which in turn means no access to a loan to buy a house, to a credit card, to be able to start a family. The dispute, which was finally settled two weeks ago by offering a permanent contract to 56 of about 90 precarious workers, displays the huge imbalances of power between employers and employees in Portugal. But its most interesting lesson was about politics and Government priorities. Setúbal is the port through which a nearby Volkswagen factory – Portugal’s largest exporter – ships the cars it makes. The long strike posed a real risk of forcing Volkswagen to suspend production, with huge economic costs. Immediately, a public discourse narrative emerged blaming the strikers for the potential damage to Portuguese exports – without considering that a port that employs 90% of its workers on daily contracts and refuses to address that issue for years is certainly not blameless in the labour dispute. The centre-left self-proclaimed anti-austerity government was accused of siding with the company, especially after police escorted the entrance of a bus into the port carrying strike breakers to take up the tasks of the strikers – a move of highly questionable legality.

The surgical strike

An even more interesting, still unresolved conflict is pitting the Government against public sector nurses. In what they are literally calling a “surgical strike”, nursing staff in five of Portugal’s biggest public hospitals are refusing to assist with scheduled non-emergency surgeries, leading to the cancellation of an estimated 7,500 operations since late November. This is a relatively low-cost, high impact protest: since it centres on surgical nursing staff, it only takes a relatively low number of strikers to paralyse operation rooms. Nurses are demanding wage increases and the effective implementation of a career advancement scheme that’s been agreed to but, they argue, is not being carried out. Of greatest political significance, though, is the fact that the surgical strike was planned and executed not by large traditional public sector unions but by nurses organising themselves through Facebook and WhatsApp, with the support of two smaller unions, established only last year. A crowdfunding campaign – the most successful ever in Portugal – surpassed the requested 350.000 EUR needed to cover the wages of striking nurses, thanks to thousands of donations averaging around 25 EUR for the strike fund. A second campaign, with the goal of reaching 400.000 EUR, is currently online to fund a further 45 strike days already called for early next year. The larger, more established nurses’ union does not support the strike, which it denounces as a “populist strike”. This is an important development, as it tells us the more politically aligned labour unions are losing ground to outsiders.

It’s worth noting that, unlike most Western European countries where labour unions gave birth to centre-left and leftist political parties, in Portugal it was the political parties who created the unions, not the other way round. Stifled under a right-wing dictatorship for nearly 50 years, and without a big industrial base before that, Portugal established its modern democracy without a sizeable urban proletariat. It was the political parties, which quickly rose after the 1974 revolution who created and organised unions – the principal ones aligned with the centre-left Socialist Party or the Communist Party. This means the current government, led by the Socialist Party with parliamentary support from the communists, should have been more successful in containing unrest. Domesticated unions would toe the line, or limit themselves to short, low-impact strikes to make their points and protect their ground, however without posing a real challenge to the government.

The nurses’ strike is flipping this script. Tactically surgical (in every sense of the word), well organised and mobilised in clear opposition to the existing bigger unions and the political parties that pull their strings, the “populist strike” signals a loss of power by an establishment which doesn’t really know how to respond. In a hearing last week in parliament, the Finance Minister Mário Centeno tried to assert that there is no social unrest in Portugal – quite the contrary. “It’s because the nations economy is growing, incomes are increasing, and unemployment is falling that people are becoming more demanding. It’s perfectly “normal”, he argued quite bizarrely, as if people were striking because of some wave of optimism and hope for the future taking hold of the nation.

The anti-austerity mirage

What is really happening is simpler: since it took power in 2015, Portugal’s leftist Government has been keen to present itself as the anti-austerity genius that squared the circle of fiscal discipline, economic growth and social development. Instead, they have been taking advantage of an international economic climate that’s a little more forgiving than it was in the worst years of the crisis and bailout of 2011-2015. Whenever choices need to be made, however, austerity reigned. In the health sector, critical spending freezes have hampered the provision of basic services – not unrelated to the nurses dissatisfaction – and investment in infrastructure maintenance is sorely missing. It’s not just trains running without crucial servicing. On 19 November of this year, a road running alongside a deep marble quarry in Alentejo, southern Portugal, was washed away after persistent rain, hurtling two passing cars into a deep quarry pit and killing all five occupants. It was later revealed that there were technical documents going back years advising the road be closed for security concerns, without national or local authorities following up or putting the resources on the ground to monitor conditions. This after over 110 people were killed last year in deadly forest fires that also left big questions about preparedness and response by emergency authorities. Last week, a medical emergency helicopter crashed under storm conditions, killing all four crew members, and it somehow took rescue authorities two hours to even start a search for the aircraft, with miss-communication between under-resourced institutions seemingly having played a big part in the fiasco – fire brigades, by the way, have also been striking. The Portuguese President admitted that “the state failed” and those failures “are not good for peoples’ trust in institutions”. A polite understatement, given the circumstances.

Centeno the Finance Minister may be claiming that the right-wing era of austerity is over, but Centeno the current president of the Eurogroup is singing a different tune in Brussels. In early December, the Eurogroup meeting chaired by the Portuguese minister called for “additional measures” to be put in place in Portugal (along with Belgium, France, Spain and Slovenia) to ensure it meets its budgetary discipline commitments. The Portuguese Government has been lining up public sector unions since 2015 and negotiating small concessions to keep some semblance of social peace, all the while asking them to be patient and stay in line for larger rewards in the future. After the 2019 budget was passed in Parliament – the last budget before general elections next year, maintaining tight spending restraints – those who found themselves without those promised rewards are now taking to the streets. The anti-austerity oasis was nothing more than a compelling mirage.

It’s not just strikes taking their toll. Just last Friday, 22 December, a group of anonymous citizens organized on social media called for massive nationwide “yellow vest” protests, hoping to create a movement of social unrest similar to the one that rocked Emmanuel Macron’s presidency in France. The Portuguese yellow vest uprising attempt was a massive failure, with no more than a thousand people joining all across the country – in the capital, Lisbon, little more than 100 showed up. In the days before the protest, however, the Government called off any vacation time and days off for the police force, mobilizing as many as 20,000 officers to make sure any uprising could be quelled. What turned out to be a massive overreaction given the low number of actual protesters served to illustrate how much the political establishment fears a tipping of the scales of public perceptions regarding not just the merits of the current government’s policy, but the sustainability of the political establishment. In Portugal, as elsewhere in Europe, politicians are increasingly afraid of their own citizens – not a healthy state of affairs in any democracy.

If European governments are to uphold and strengthen European democracy, they must be clear about where we need a commitment to continuity – in strong institutions, in free speech, in affirming the rule of law – and where we need radical changes – in rethinking our economic system, in developing new mechanisms of accountability, and civic engagement, in fighting corruption and state capture. The alternative to this lack of clarity and leadership is the development of a siege mentality of the political class, of mistrust in the relationship between citizens and politicians, a sort of civil cold war that is pushing us slowly and blindly towards the breaking point – or maybe, by some miracle, somehow towards a solution to the current political crisis.

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