Europe’s youth has opportunity to do it better
As part of the construction team that built the EU project, Ireland has to take its share of blame for this employment crisis, and it needs to do better in finding solutions to it.
Ireland shares part of its current structural problems with Spain. Both countries gorged themselves on a property boom and bust that ended up crippling their banking systems, an act which in itself has suffocated both economies.
Combine dramatic weakness in Exchequer finances with a broken banking system and a collapse in consumer confidence and — hey presto — you have a dire economy. In Spain 27% of those who can work are unemployed. If you are under 25 the rate has shot over 50%, leaving a generation bewildered and searching for solutions from those who lead them.
Because there are no daily air raid warnings, bombings and killings in Ireland or Spain, the economic war being waged in both economies has a strangeness to it. Despite horrendous levels of unemployment, a sense of normality pervades many parts of society.
Those fortunate enough to have work (guilty as charged) and not buried under a mountain of personal debt are being offered more value for many products and services. Life is actually okay too for many who have retired on funded pension schemes that provide income for households in an age cohort where mortgages and dependent children are a distant memory.
The killing-zone in this economic horror show is positioned among the youngest and they are and will continue to pay a heavy price for the institutional failures of the last five years globally. Not only are their employment prospects bludgeoned but the probability is that personal and indirect tax rates are likely to rise over the next decade as governments continue to rebuild national finances. And, oh yeah, interest rates around the world are at record lows too, so anyone planing to use debt must assume a rising cost for servicing borrowings over the next decade or so.
This cheery analysis has one fatal flaw. It assumes that younger people in a democracy have no voice. That’s just not true. Furthermore, they have energy levels, knowledge skills and health attributes that their elders never had.
Tapping in to these resources is a challenge for any politician or political party but consider the potential force that could be harnessed if a leader can detail a future that aggressively tackles austerity,divines a set of policies that can light up employment creation and radically attacks the status quo in Europe.
The prevailing employment crisis is fertile ground for such a movement. Europe’s leaders must hope it is a constructive force and does not revert to the troubled templates of the past.
It is surely time to have a more thorough review of the austerity culture that has transfixed policymakers, politicians and central bankers in Europe. It is clear that influential elements inside the IMF, which is known for its hardline stance historically, are now more concerned about the absence of growth than a quick adjustment of national finances.
One of the world’s leading bond investors, Bill Gross of PIMCO, has recently shifted his views towards advocating more growth policies in the UK and eurozone. Coupling these institutional voices with a political party that majors on radical employment creation options could unlock the unseemly mess that currently defines Europe.
* Joe Gill is a director of corporate broking with Goodbody. His views are personal
