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EU: Disputes Over Jobs Presage Hollow Summit

Prague, 14 November 1997 (RFE/RL) - Six days before their special "jobs summit" in Luxembourg, European Union leaders and high EU officials are publicly arguing among themselves about how to reduce the chronic unemployment that afflicts most members of the 15-nation group.

Their disputes presage a hollow summit given over to high rhetoric and no new concrete measures seriously aimed at diminishing Western Europe's joblessness.

This is bad news for Central and East European candidate states seeking early entry into the Union. The reason is that current EU members are likely to prove reluctant to allow millions of Eastern workers to compete with their own citizens as long as the number of jobs available continues to diminish in Western Europe.

Yesterday Eurostat, the EU's own statistics office, reported that the Union-wide unemployment rate remained at 10.6 percent as of the end of September. That translates into 18 million unemployed across the Union. Eurostat said that four member-states were above average -- Spain (20 percent), Finland (13), France (12.6) and Italy (12.1) -- while Germany, with the EU's largest economy, was deemed just under the average with 10 percent.

But like national governments' reckonings of joblessness, the EU's official figures can be deceptive, as one of its senior officials now admits. In an interview with the daily "International Herald Tribune" today, EU Employment and Social-Affairs Commissioner Padraig Flynn of Ireland says he doesn't agree with "people (who) say there are 18 million unemployed. I think it is considerably more, perhaps another nine million." If Flynn is right in suggesting member governments fudge their figures to make them look less bad -- as many analysts have insisted for years -- then the EU's real jobless rate would be over 15 percent.

So would be Germany's as well. But yesterday Chancellor Helmut Kohl reiterated his opposition to any new EU collective initiative that would force his country, the EU's biggest net contributor, to pay a major part of the bill. Speaking in the Bundestag, Kohl declared that employment policy, in his words, "is mainly a national and not a European task." He rejected calls from opposition Social Democrats to set jobs quotas at next week's EU summit --a measure also advocated by France's Socialist Prime Minister Lionel Jospin.

It is actually because of Jospin that the Luxembourg meeting is being held at all. At the Union's Amsterdam summit four months ago, the leader of France's just-elected Left Government insisted the meeting be scheduled before he would agree to the German-inspired stability pact that will impose strict budgetary discipline on EU members joining the new single currency in 14 months. Ever since, high French officials have repeatedly said the summit would be productive, although they know as well as anyone else that without the support of Germany -- and several other members which have expressed opposition -- the consensus needed to put in place new substantive EU jobs policies will be impossible to achieve.

EU Executive Commissioner President Jacques Santer now knows it, too. That's why yesterday he told reporters the summit should only adopt "guidelines -- ambitious, precise and if possible quantifiable" -- on creating new jobs, and denounced what he called "vast and costly employment programs." He said he had been what he termed "misinterpreted" the day before when he angrily told the same group of reporters that "the summit must take action --we cannot permit it to fail (for) political reasons. Have not unilateral national approaches," he asked Wednesday, "sufficiently demonstrated their ineffectiveness?" But after Kohl spoke yesterday, Santer in effect ate his words of 24 hours before.

Santer's Commission had earlier proposed a series of structural reforms in members' economies to boost jobs. They included revamping social-security systems to encourage the unemployed now living off substantial government benefits to take up work, and reducing payroll taxes to make it easier for businesses to hire new staff. The Commission said these and other reforms could increase employment by up to 1.5 percent a year. Objective economic analysts have been saying for years that only such basic reforms can reverse the EU's increasing loss of jobs.

Yet for what Santer called "political reasons," governments of many EU states have rejected the Commission's advice out of hand. They know that enactment of social-security reductions alone could wreak voters' havoc on incumbent governments. So instead two of them, France and Italy, have introduced measures to cut back the work-week from 39 or 40 hours to 35 or less hours -- without any reduction in pay. And Germany's largest union, representing machinery and metal workers, is now pushing for a 32-hour week -- albeit with proportional trims in pay.

Businessmen, economists and Commission officials in Brussels have loudly denounced all such efforts. Several analysts have suggested ironically that, in the words of one of them, "the shortened work-week should be taken to its logical conclusion: cut back the hours all the way to zero and guarantee everyone a job." That black humor may turn out to be the most appropriate comment on the EU's collective impotence in creating jobs.