The battle for Europe’s future

European economic progress cannot be understood without grasping its social dimension, argues Jose Manuel Barroso, the President of the European Commission

  • 20 May 2007
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Economic and social progress are two parts of the same, European whole. Europe has always rested on an economic pillar and a social pillar.

The Coal and Steel Community was the precursor of the Social Fund. The single market had the Social Charter. The question today is what kind of social Europe a truly global Europe needs.

We need a modern social vision to accompany our drive for open markets. Open markets and social solidarity are not, and should not be, contradictory. There is no greater instrument of social cohesion than full employment. And welfare states need to be put on a firm financial footing to be sustainable for future generations. To quote the start of the Commission’s own document to the Hampton Court Summit: “Europe must reform and modernize its policies to preserve its values.”

We know that Europe’s societies are defined by their diversity. This diversity has led different member states to develop different social models to cope with different social transformations.

For example:
• The founding member states enjoyed the trentes glorieuses, only to see growth suddenly slow and unemployment become a significant problem.
• Central and eastern European member states endured communist mismanagement, followed by a traumatic period of transition in the early 1990s.
• The so-called Cohesion Four (Ireland, Spain, Portugal and Greece) saw transformation through rapid modernization, especially after joining the EU.
• The UK saw a sharp break with the post-war consensus in the early 1980s that ended economic decline, though at a social cost.
• And northern member states turned economic crisis at the end of the 1980s into outstanding growth performance and a revival of interest in the Nordic Social Model.

So there is no single, European social model, although seen from the outside, beyond Europe’s borders, it might look that way; and there are common principles underpinning our social models. Our diversity is a source of strength; it helps us to learn from one another, and to adopt and adapt ideas that have been proven to work.
No member state’s social model is perfect, but we know that countries that have been able to reform have thrived in the global marketplace and sustained high levels of social justice. Social justice and economic efficiency can be mutually supportive – indeed, it is essential that they are.

So, what can the European Union, and the European Commission, do? Not to try to centralize decisions on the future of Europe’s welfare states, but rather to promote a Europe-wide debate about them, to present facts and ideas to show the way to the future.

Global setting

We all know the backdrop to this debate: globalization. We should acknowledge the challenges it creates: the disappearance of traditional industrial jobs, and the problems the lower-skilled can have in finding new jobs; the need for a highly educated society; the risk of a new polarization for those left behind with poor literacy and inadequate qualifications; the emergence of new geographic and income inequalities; the challenges of migration and integration in our societies.

But it would be a grave mistake to demonize globalization or to exaggerate its consequences for social change. The fact is, in recent years, social change has mainly been driven by internal dynamics, shared by all our societies.
Europe’s economic transformation towards a post-industrial knowledge and service economy is changing not only the kind of jobs people do, but also the conditions of access to economic opportunity; the extent of social mobility; and the incidence of poverty and inequality.

The achievement of mass affluence and rapid economic modernization have profoundly influenced values. We can see this in new patterns of family life and the changing position of women in society, for example. But this individualization goes side by side with an increased desire for a more socially cohesive and socially responsible society.

Rise and fall

Demographic change is resulting in declining fertility and longer life expectancy. In 1950, 40% of EU citizens were under 25, by 2025 less than a quarter will be. In contrast, fewer than one in 10 were over 65 in 1950; nearly one in four will be in 2025.
The rise of the citizen as consumer is changing the way we think about issues such as housing, health and public services. It is also encouraging the emergence of new concerns like ethical consumption. I see no evidence of citizens being less concerned with public issues, but politicians have to admit that participation and trust in traditional forms of politics is in decline.

The welfare state has reshaped the quality of life for tens of millions in our societies. But it has also created new dependencies from which individuals can find it difficult to escape.

Given these shared challenges, it should come as no surprise that the European Commission proposed in May to take stock of the social situation in the European Union, and that Europe’s leaders agreed to this, “with a particular emphasis on access and opportunity”. After all, it is difficult to develop modern, forward-looking social policies based on outdated notions of the nature of our societies and their needs.

This social reality stocktaking is already underway, and is linked to a parallel review of how the single market has evolved. The stage is set for a big debate on a common vision of Europe’s social future. And the focus, I think, should be on access and opportunity, as Europe’s leaders requested.

Equal opportunities

We have to break away from debates on how to enforce equality. I don’t believe it is either just or possible for society to impose equal outcomes on its citizens. What I do believe in – and believe strongly – is the importance of equal opportunity. Every European citizen should have the possibility to fulfil his or her potential to the full. Deny that possibility, and society as a whole is diminished.

But vague support for equality of opportunity is meaningless unless it is accompanied by policies to ensure that it becomes a reality for all citizens. Therefore, as we launch the debate about access and opportunity in Europe, I think it is important to focus on some key issues:

• why one fifth of school children don’t reach the basic standards of literacy and numeracy;
• why one in six young people are still leaving school without any qualifications, when we know that fewer and fewer unskilled jobs will be available;

• why there is still a strong correlation between students achieving a place at university and the educational background of their parents – in the knowledge economy, we have to ensure higher educational standards for a broad majority;

• why some member states are so much better than others at integrating second generation migrants, enabling them to achieve more in the education system;

• why access to childcare is so patchy when the evidence is so strong that better childcare leads to higher fertility, more job opportunities for women and greater gender equality;

• why child poverty continues to blight the prospects of a fair start in life for a fifth of Europe’s children;
• why work is a strain and stress for too many, and decent family life and traditional support structures are put under too much pressure;

• why so many older people drop out of the labour force too early when in an ageing society we can ill-afford to throw their talents and contributions on the scrap heap.

Let the social debate begin.
  • 20 May 2007

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