Portugal: a case study in the politics of austerity

Portuguese workers face a bleak future but the country's weak, fragmented left has empowered the neo

A worker holds the Portuguese flag during a protest against government austerity measures last week
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Portugal had certainly geared itself up for last Thursday's general strike against the IMF/EU-imposed austerity package. Not long after landing in Lisbon a few days before, I noticed that the city was plastered with colourful banners and posters. "Reject the Pact of Aggression!" bellowed hundreds of Portuguese Communist Party posters; others called for people to "Fight the Austerity Regime." In their preparations for the greve geral, Portugal's trade unions could certainly teach their British counterparts a thing or two.

But - then again - workers in Portugal face an even bleaker future than they do here. Pedro Passos Coelho's right-wing government has extended the working day by half an hour, driven through deep cuts in health and welfare, and is cutting Christmas bonuses for civil servants. That's essentially the thirteenth payment of their annual salaries and, in a country where the minimum wage is just €450 (£386) a month, it makes a big difference. Social gains won over decades are being stripped in weeks and months.

Portugal was the third EU country to be bailed out after Greece and Ireland, and the austerity measures are justified by the terms of the €78bn package. But, as elsewhere, the policies have sucked growth out of the economy. When credit-rating agency Fitch downgraded Portugal's debt to junk status on the same day of the strike, they estimated the economy would contract by 3 per cent next year.

The thousands of strikers who gathered outside the National Assembly on Thursday certainly feel that austerity has gone too far. 'Basta' - 'Enough' - was the most common slogan inscribed on banners. Enraged workers expressed that familiar frustration of the post-Lehman era - why are we being made to pay the bill for someone else's mess? "The poor class and the middle class are being made to pay for this crisis," Maria, a media assistant, told me. "We are spending our money to give to the banks. It's not fair - they're putting it in their pockets." Protesters had a strong sense that they were facing a similar onslaught - differing only in scale - as other Europeans. But there was also deep anger expressed at the Troika enforcing austerity - the European Union, the European Central Bank and the International Monetary Fund. Across the political spectrum, there's a realisation that Portugal has lost much of its sovereignty.

Portugal will be an interesting case study as to just how possible radical neo-liberal policies are in modern democracies. Economists close to the government privately express impatience that "reforms" are not fast or far enough. But their real fear is that the democratic system is on a collision course with what they regard as necessary policies, which - they believe - will prove to be short-term pain for long-term gain.

Maria certainly doesn't expect resistance on the scale of Greece. "We're not such a radical country," she argues. "We're very, very peaceful." While Communists dominate the main trade union federation (the CGTP), union membership is even lower than Britain - running at less than a fifth of workers and, as here, overwhelmingly concentrated in the public sector. There have only been two other national strikes in the 37-year history of Portuguese democracy.

But Portugal also has a recent revolutionary tradition. When left-wing army officers toppled António Salazar's authoritarian right-wing 'New State' regime in the 1974 Carnation Revolution, radical politics flourished. "Socialism" was inserted into the constitution, and the first post-Salazar Prime Minister Vasco Gonçalves pledged a "fight to the death against capitalism." Time magazine even fretted that the revolutionary government would "transform Portugal into Western Europe's first Communist nation." It didn't pan out that way, but constitutional clauses forbidding privatisation remained in place as late as 1989.

Many of Thursday's strikers drew on this tradition. "The 25th April forever, liberation from fascism!" was one of the chants, referring to the day that left-wing officers toppled the Salazar regime.

But, as in most other European countries, the left has failed to benefit from the biggest crisis of capitalism since the 1930s. In fact, quite the reverse. The June general election was certainly marred by low turnout, suggesting widespread disengagement from the political process. But the right-of-centre social democrats won over half the vote, while the even more right-wing People's Party achieved their best result since 1983. The Socialists were kicked out of office with their worst showing since 1987; though, in any case, they were also committed to radical austerity measures. Meanwhile, the Communist vote stagnated, and the radical Left Bloc lost half their MPs.

It is this weak, fragmented left that offers the best chance of success for radical neo-liberalism in Portugal. Frustration and anger will inevitably escalate further but - unless a coherent alternative emerges to give it political focus - it is unlikely to present a real challenge to austerity. And if that's the case in Portugal, it's just as true everywhere else.

Owen Jones is a left-wing columnist, author and commentator. He is a contributing writer to the New Statesman and writes a weekly column for the Guardian. He has published two books, Chavs: the Demonisation of the Working Class and The Establishment and How They Get Away With It.

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The top 10 reasons Brexit isn't working, according to Brexiteers

We'd have got away with it, if it weren't for that pesky Mark Carney. 

Over the next few years, it is likely that the economy will shrink, that the entire government will be consumed by trade negotiations at the expense of every other priority, and that EU leaders will use their considerable negotiation advantages to theatrically screw us. As this unpretty story unfolds, those who argued confidently for Brexit, in parliament and in the press, will feel compelled to maintain that they were right, and that if it hadn’t been for some other impossible-to-foresee factor everything would be going splendidly. What follows is an attempt to anticipate the most predictable post-rationalisations; I’m sure there will be more creative efforts.

1. WHITEHALL SABOTAGE. If we’re making no progress in trade negotiations, that’s because the civil service is doing its best to scupper a successful Brexit. That power-crazed madman Jeremy Heywood will stop at nothing to ensure he is bossed by Brussels, and the snooty bastards at the Treasury are working to subvert the national will out of spite. Even as our finest ministers strive manfully to cut Britannia free of its enslaving chains, all they hear from functionaries is “It’s a bit more complicated than that”. It’s only complicated because they want it to be.
 

2. REMAINERS TALKING DOWN THE COUNTRY. God knows we tried to reach out to them, with our gently teasing admonitions for being elitist snobs who just needed to get over it. But did they concede that a glorious future is at hand, if only we all wish for it? No, my friends, they did not. Instead, they sulkily point out how the things they predicted would happen are in fact happening, as if this somehow proves they were right. And since, inexplicably, the world agrees them, the whiners’ prophecy is being fulfilled.
 

3. THE GLOBAL ECONOMY. It appears the UK economy has sunk into a recession. Now, the whiners will tell you that this has got something to do with the vast uncertainty created by taking a fundamental decision about the nation’s future without a clue about how to implement it. In reality, of course, the recession has been caused by the same global economic headwinds that had absolutely nothing to do with the 2008 financial crisis, which was all Gordon Brown's fault.
 

4. ECONOMISTS. Since they nearly all said that Britain would be worse off if it voted Out, they now feel compelled to tell us that things are indeed worse. OK, maybe they are worse. But think about it: if we hadn’t voted Out, the economy might be even more calamitously buggered than it is now. This is logically unassailable. But do economists ever point it out? Do they Brussels. Yet sadly, global businesses, investors, consumers, and lots of other people who frankly lack gumption or vision, take these so-called experts seriously.
 

5. MARK CARNEY. Let’s get this straight: the Canadian governor of the Bank of England doesn’t want Britain to succeed, because then we’d be a direct competitor to his motherland. But with his honeyed voice and perpendicular jaw and incessant references to “data”, this man has gone a long way to convincing much of the public that he is some kind of disinterested authority on Britain’s economy. In reality, of course, he is out to destroy it, and seems to be making a pretty good fist of doing so.
 

6. EU BUREAUCRATS. You know those people we spent years attacking for being interfering, self-enriching, incompetent fools? Turns out they are now keen to make our lives as difficult as possible. The way to deal with this, of course, is to mount a national campaign of vilification. Another one. Before long they will be begging for mercy.
 

7. THERESA MAY. Look, we all wanted her to succeed. We knew she wasn’t one of us, but she wasn’t exactly one of them either, so we gave her a chance. Yet perhaps it is time to admit the possibility that the Prime Minister isn’t making this work because, when it comes down to it, she just doesn’t share our blood-pumping, sap-extruding belief in Britain unbound. In short, she’s just too damn reasonable. It’s time to embrace the unreasonable man. What’s Boris doing these days?
 

8. THOSE OTHER BREXITEERS (i). Not only can we not get the Remainers to present a united front to Brussels, it seems that we can’t even rely on our fellow Brexiteers. Most of us are on the same page: take back control of our borders, blue passports, compulsory blazers, onwards and upwards to the sunlit uplands. But there are some among our own ranks who frankly don’t get it. These latte-sipping media types simper on endlessly about the importance of retaining access to the single market and seem awfully keen on Norway. Why don’t they just go and join Remain?
 

9. THOSE OTHER BREXITEERS (ii). Hey guys, the problem is this: Brexit got hijacked by the roast beef and two veg brigade, OK? For us it was always about unleashing the entrepreneurial spirit, shaking off the dead hand of Eurocrat regulation, being more human, that kind of thing. We had to go along with all that anti-immigration stuff but believe me we were biting our tongues and crossing our fingers. Some of our best friends are Turkish.
 

10. NONSENSE, IT IS WORKING.

Ian Leslie is a writer, author of CURIOUS: The Desire to Know and Why Your Future Depends On It, and writer/presenter of BBC R4's Before They Were Famous.