by Ramin Mazaheri for the Saker blog

Most damning to the claim that the pan-European project is benevolent is that there was no plan to relaunch the Eurozone economy after the 2007 economic crisis, unlike in China and the United States. The reason for that became clear: chaos was fostered in order force through “reforms” which would revert postwar European Social Democracy back to Western Liberal Democracy – that is what the word “reform” truly means in modern economic journalism.

(This is the tenth chapter in a new book, France’s Yellow Vests: Western Repression of the West’s Best Values. Please click here for the article which announces this book and explains its goals.)

The French truly had something to lose from these “deforms”: France’s model combined strong social protections on a Nordic scale but without their withdrawal of public ownership via de-nationalisations and certainly without their labor market “flexibility”, i.e. poor unemployment insurance, reduced recourse to legal protections for fair conditions & pay and gutted worker protections via the proliferation of short-term work contracts.

The other critical aspect of the “French model” was its resilience to the cyclical busts in capitalism – buying low when there is blood on the streets is critical to keeping capitalism to the “200 families” with whom Socialist Prime Minister Leon Blum negotiated in 1936 because, as he said, “Who else was there for me to negotiate with?” After both the economic crisis and the coronavirus crisis top Western commentators were shocked that France’s economy was a star Western performer, but avoiding prolonged crises is entirely the point of socialist central planning, which influenced France’s postwar “Mixed Economy” model. France’s GNP grew 34% from 1998-2018, greater than the Eurozone average (33%) and alleged top performer Germany (32%). Combined with a worker productivity which is perennially leading or near the top of the Eurozone, it’s clear: There is no stagnation of the French model no matter how often that is falsely cited as a reason for “reforms”. The alleged “stagnation” is a euphemism to describe French resistance to reintroducing wholesale Liberalism for the third time since 1848.

The fall of the French model began in autumn 2010, when Nicolas Sarkozy backtracked on a promise to raise the retirement age. The French responded with seven marches in eight weeks with at least 1.5 million marchers each time. One week saw three marches with perhaps 3 million people each, but Sarkozy didn’t budge. Despite being even larger than the Yellow Vest protests, it was the first time since the re-reintroduction of Liberalism in the mid-1970s that major social protests failed to win any concessions. The reason for that was made crystal clear in the previous chapter: the Lisbon Treaty’s firm establishment of the European Union in 2009 had created supranational masters to which the French president was now solely accountable. No longer was he or she accountable to the French people, and this vital misunderstanding still afflicts French politics in 2022.

If we want to look for a start of the Yellow Vest movement it would be with this failure in 2010; if we want to see what inspired Emmanuel Macron’s autocratic style, it would be here as well.

As we wouldn’t learn until 2015, in March 2011 European Central Bank president Jean-Claude Trichet threatened Ireland’s newly elected government with a “bomb” should they follow through on promises to impose losses on the failed business decisions of the Anglo Irish Nationwide Bank, despite this being a key plank of their election campaign. That “bomb” was assumed to be expulsion of the euro. The Lisbon Treaty thus allowed Brussels to progress from negating referendums on installing the EU to negating national elections which disagreed with the policies of the EU. The most well-known example of this would be their strangulation of Greece after the anti-austerity Syriza party was elected in 2015.

In 2012 optimism in France was extremely high, probably like in 1981 and 1936: Socialist Party President Francois Hollande narrowly defeated Sarkozy, who had been the first mainstream French politician to absurdly suggest that France’s economic problem was Muslim welfare and not banker welfare. The 2+ million Muslim vote got their revenge by playing kingmaker – they voted for Hollande to the tune of 93%, and the election was decided by just 1.1 million votes. People wanted to believe in the empathy of a famously formerly-fat guy from the countryside nicknamed “Mr. Normal”. Out was the aristocratic Sarkozy, whose tenure was summarised by French media via a term from American rap music which describes the shining of jewellery: “bling bling”. Hollande openly declared that high finance was his “enemy”, the Socialists swept the legislative elections and they could undeniably boast of a genuine anti-austerity mandate. A united “Latin Front” was finally going to throw its weight around – Italy’s call for a very necessary pan-Eurozone banking union broke the mainstream taboo against honest talk on this subject. The democracies of small Ireland or Greece might get pushed around, but surely not France?

Unlike in 1983, economic crisis was not set off simply because a Socialist took power in Paris – France’s borrowing (bond) rates were always extremely low in this era of economic turmoil, as France was the world’s 5th largest economic power and perceived as a low-risk haven. However, the bond borrowing rate for Spain hit an unsustainable 7%. This was the apex of the European Sovereign Debt Crisis, when many wondered if the euro would crumble, and like in 1983 it was provoked by high finance speculators – the Bankocracy strikes again.

Speculators had perceived that the 2007 economic crisis, the ragingly neoliberal structures of the pan-European project and the anti-solidarity nature of Western capitalism all combined to make what was then the world’s second largest macro-economy also the most unstable.

Speculators began attacking poorer countries, causing bond spreads between Eurozone countries to diverge sharply in what was supposed to be a unified currency bloc. If major economies like Spain or Italy had to borrow at high rates in order to keep the streetlights on then staying in the euro would be economic suicide. They no longer had a currency to devalue, and thus no way out. The solution as demanded by Liberalism – to devalue their workforce into competitiveness – would take many years. Until that dubious capitalist goal was achieved richer northern countries could borrow euros at low rates and even purchase the assets both big and small of poorer nations. The problem as presented by the mainstream media was debt taken on by poorer Eurozone countries, not the poor decisions of richer Eurozone countries to make those foolish loans, and certainly not faults built into the Liberalist structures of a pan-European project which was rammed through despite regular democratic disapproval and amid economic chaos unseen since 1929. Indeed, the crisis birth of the Lisbon Treaty can’t be stressed enough, nor its autocratic installation by the elite Liberalist oligarchy, because both reveal how they clearly represent regression from the trend established in 1789: the move away from autocratic government and towards democratic empowerment.

In June 2012 France, Italy and Spain (the Latin bloc) forced a midnight meeting with Germany on the sidelines of a Eurozone summit – this gang of four would decide policy unilaterally for the entire eurozone, and with major consequences.

They agreed that the European Central Bank would be the supervisor of Eurozone banks – this made the ECB the most influential central bank in the world behind that of the United States. They decided to end the preferential status of governments over private investors in cases of default – the failed private banks in Spain were now as equal as the average eurozone taxpayer, with the former having just a bit more lobbying clout. Bailouts would now bypass national governments and go directly to private banks. Finally, Spain gave up trying to rescue its ailing banks alone and accepted a €100 billion bailout from Europe.

This was the deal which allowed the president of the ECB, Mario Draghi, to famously “save the euro” in July by uttering just one sentence: “Within our mandate, the ECB is ready to do whatever it takes to preserve the euro.” All high finance heard was “whatever it takes”, and that this came after a bailout of the shoddy banks of the bloc’s fourth-largest economy. Draghi had implied that the ECB would violate the “no bailout” clause in the Maastricht Treaty, and bond interest rates fell bloc-wide, ending (or rather postponing) the European Sovereign Debt Crisis.

With the gang of four’s new rules, in September the European Stability Mechanism (€500 billion in reserves to help eurozone economies) would be created to run alongside with and then replace the European Financial Stability Facility (created in 2010 with €440 billion in reserves). More no strings attached bailout money was poised to enter the system if needed.

Thus, that same month a third round of Quantitative Easing (QE3) began in the United States, and this is the unnecessary round which revealed to the world that Liberal Western Democratic financial systems were undergoing a radical transformation. QE1 bought the infamous subprime mortgage assets, what I term QE 1.5 bought debt securities in the credit market, QE2 bought longer-term US securities, but QE3 created much anger from developing countries because it became clear that Western QE was not a temporary measure designed to solve a few specific problems.

Instead, it revealed a plan to flood the entire globe with newly printed Western money to serve as an enormous debt trap; that the West could not admit that the recent three decades of failures by “neoliberalism” had crippled their “real” economies will falsely inflating their financial industries; that the West could not admit that no strings attached QE wasn’t improving the quality of (via “trickling down”) their real economies either; that Western central bankers had resorted to QE because Western private banks had lost faith in each other’s integrity; that nobody knew what would happen when private banks then lost faith in central banks; that taking away this “cheap money” would produce economic chaos in the form of long-forestalled genuine valuations re-based on economic fundamentals; that the West was adding a “subprime central bank” crisis onto their “subprime loan” and “subprime bank” crisis.

The problems caused by the Great Financial Crisis – and by the failure of Western Liberal Democracy’s implemented solutions – are obviously quite Great indeed. The collusion of governments with corporations and banks – which is one of the ideas of fascism which Western Liberal Democracy subsumed, just as they had subsumed ideas of absolute ad aristocratic monarchy earlier – makes it truly no exaggeration that Western Liberal Democracy suffers from a “subprime government” crisis.

The ECB would follow the Bank of Japan’s original lead and start with no strings attached “Quantitative Easing” in March 2015. It was supposed to end in March 2017 but QE was still continuing at the time of publication after many prolongations. Because taking away this “cheap money” was certain to produce economic chaos QE would be passed like a baton around many of the G20 economies to keep the trick going. This was obviously a very real collusion between central bankers and corporate private bankers, and why I often refer to a “Bankocracy”: this is who decides public policy in Western Liberal Democracy, especially when we consider the role of the Eurogroup.

In 2014 the ECB had pushed interest rates into negative territory, taking yet another cue from the Bank of Japan, truly the West’s central banking innovator. The main reason they can be so innovative is that their debt is almost wholly owned by Japanese people – this is not at all the situation in the Eurozone, as the sale of Greek assets shows. ZIRP (Zero Interest-Rate Policy) was an effort to keep inflation down amid the banker bailout money printing, but also a way to encourage banks to finally loan some of this taxpayer bailout money downwards. However, with no strings attached here, either, banks never did. ZIRP proved to be another fiscal policy disastrous to public finances, as it was also manipulated by elite to fuel their lifestyle and to further inflate their preferred asset classes. ZIRP, like QE, would also be passed around the G20 to keep the money conjuring going.

Yellow Vest: “Of course the movement will continue because there is so much injustice in France today. Above all, there is economic injustice.”

(Note: this book intersperses over 100 quotations taken from actual, marching Yellow Vests which were originally published in news reports on PressTV.)

But the European and Western elite wanted even more than just free money and no-risk loans – they also wanted an end to any socialist-inspired drags on their profits caused by the advances of mere Social Democracy. On November 6, 2012, Francois Hollande made a U-Turn as bad as Francois Mitterrand did in 1983 when he also backtracked on his anti-austerity promise. His unveiled 2013 budget contained basically all the neoliberal, economically-regressive measures proposed by Sarkozy during the presidential campaign. It was a total shock to the average Frenchman, who had not grasped the power of the Lisbon Treaty. France’s two-party system was officially a uni-party system: pro-Brussels.

On the very next day Hollande submitted to parliament a divisive, deflecting law to legalise gay marriage and gay adoption – it was a stunningly cynical move. November 7, 2012, is a perfect incarnation of what Western democracy has become: class-obscuring identity politics combined with far-right economics, which is then ludicrously passed off as progressive politics. Such preposterously false politics can be achieved only via forbidding socialist-inspired analyses from regular public debate: Insisting that all political analysis promote Liberalism, combined with fascism’s obsession with tribe and identity politics, allows for “left” and “right” to lose solid definitions based on class, history and consensual agreements on reality, and to create nebulous definitions which are so grounded in personal whims and individualist nonsense that they are clearly reminiscent of the illogical rule of an autocrat.

The connection between the two events was rarely uttered, and the pro-gay news widely prevailed instead of the economic backtracking which would gut the lives of countless French people regardless of sexuality. If European citizens had assumed that France would continue its tradition of bravely being a primary torch bearer for progressive politics – they were now definitively mistaken. Hundreds of thousands of people would regularly protest against the extremely minority, pro-gay measures in the “Manif pour tous” (The Protest For All) marches, which ran regularly from November 2012 until May 2013, when the law passed. The diversion and safety valve worked perfectly.

In January 2013 the European Fiscal Compact came into effect: it was the official enshrining of austerity budgets across the Eurozone, and the official death of Keynesian government spending. The French left had gone from the radical equality of 1789, to majoritarian Marxism, to compromise Keynesianism and now to aristocratic Liberalism.

The stated goal was to appease international lenders and keep long-term interest rates down. The Compact’s rule that a national budget deficit must not exceed 3% (a completely arbitrary number) of GDP would be wielded repeatedly in order to roll back Social Democracy into Liberal Democracy. Mass protests across France called for a referendum on the European Fiscal Compact – these were completely ignored, and the Compact was ratified merely by parliament, again. The anti-1789 regression back to autocratic oligarchy thus took another major step towards total normalisation.

The first budget of Hollande, elected on anti-austerity, was the strictest in 30 years.

France was not alone – when other Eurozone nations budgets unveiled their austerity turn protests broke out in many counties, and lasted for months in places like Spain and Greece. By October 2013 Hollande was the most unpopular president in French history.

Thus from the forcing in of the EU in 2009 until 2013 the economic crisis caused by Western Liberal Democracy was used to strengthen their Bankocracy more than ever. Not just France but almost all of Europe was truly restored to its usual historical state – autocratic oligarchy.

In spring 2014 a headline first appeared which would be repeated over and over: stock dividends hit a quarterly European record. In 2012 France’s CAC 30 stock index hit a low of 3000, but by 2022 it would reach 7,000 despite a lost decade of economic growth and then the coronavirus recession. This is not solely thanks to Western policies of Quantitative Easing and ZIRP: The economies of Western Liberal Democracies had clearly become totally untethered from economic fundamentals – as in Liberalist capitalism – and now clearly relied on fascism’s alliance of political power and corporate power.

The subsuming by Western Liberal Democracy of fascism’s economic policy, its obsession with identity politics and its authoritarian governance style simply cannot go unremarked upon by leftists. It’s a conclusion which is as obvious as it is never mentioned, and fully fits in with the trend of a Western political-economic history described in this book. The irony is that such conclusions are accused of being emotional and unscientific, and yet it’s repeatedly stated that it’s neoliberalism which is a “faith-based ideology” precisely because – even after a fourth decade – it lacks factual proofs of its broad success for the masses. This book shows that Liberalism also lacks such proofs for almost all of its two centuries of existence.

What is Quantitative Easing and how did it differ from this era’s new invention, Bitcoin?

Why is QE known as “free money” and what is the collateral backing QE?

The Eurozone did not discover any mines which yielded them several trillions worth of gold. What they discovered was that the Bank of Japan was correct back in 2001: modern printing presses don’t have to actually print in order to create real-life money. Digital zeroes simply need to be typed on a government computer and then copy-and-pasted into the computers of private banks. Thus, QE money was truly created out of thin air (ironically, this was the common Liberalist accusation towards Bitcoin).

The simplest breakdown of what that means is: QE has taken printed money and given it to private banks so that private banks could give it back to central banks in the form of buying national bonds, which the government then uses to pay salaries and keep the streetlights on. No value is created for anyone except for the private banks – it is the ultimate victor of the rentier, he or she who adds no value but only parasitically extracts value. Western Liberal Democracy has evolved from constitutional monarchy to oligarchic Western Liberal Democracy to a fascist Bankocracy.

Here is a more detailed explanation of what that means in practice:

On their computers the ECB creates money out of “air”, which they lend to national central banks in the Eurozone to bail out private bankers who made poor business decisions. (National central banker middlemen would be cut out via the European Stability Mechanism in 2012.) However, private banks would infamously refuse to loan this public money backed by the good name of the Eurozone’s people out to the average person/small business. Instead of making these lower-yield but socially-productive investments, the elite spent the money to inflate the asset classes which only rich people can afford to invest in – stock buybacks are the most notorious example. Worse, this refusal to loan downwards actually has the real effect of creating even more “air” money: By actually investing the ECB’s “air” in something high-yielding, such as in the stock market, this artificially boosts prices – the stock price has risen based merely on increased demand instead of due to hard-won improvements in its actual economic fundamentals. The same goes for something like real estate or jewellery or fancy art: increased demand is what raises those prices as well. This also allows stockholders and landlords, for example, to show private banks their “air”-inflated stocks or real estate as collateral to procure private bank loans (of quite real money) to further fuel their elite lifestyles. These loans of real money – despite being based on “air” – also increases the balance sheets/assets of private banks and makes them look more stable, because they are powerful enough to loan out so very much money to elite individuals and institutions. That gives them even more borrowing power. Most importantly about the ECB’s “air” money” is that it empowers private banks to loan real money to national governments – in the form of buying their bonds – in order to keep the streetlights on, and we are back to the start: the money has been fully washed. Thus it is not the ECB but the private bank which allows the Eurozone’s national governments to fund their national budgets, and thus the ECB has truly given money to private banks in order to make national governments even more indebted to private banks, even though private banks have just been bailed out by both taxpayer money and “air”. The national governments of the Eurozone thus remain solvent/avert bankruptcy/don’t disappoint investors, but they do keep on paying usurious interest fees and effectively hand control of public policy to these creditors. Marx realised that bond buying was the corrupt, phony game upon which Western Liberal Democracy is entirely based, and properly condemned Louis-Napoleon Bonaparte for perpetuating it.

This dance happened every month to the tune of €60 billion per month and still continues at the time of publication. That amount is now supposed to dwindle to zero by the autumn 2022, but they have been saying that since autumn 2017.

Yellow Vest: “The government is deaf! For three months we have been in the streets to call for social and fiscal justice, but they have done nothing. The past 10 years have seen more taxes on the average person, while the rich, corporations and shareholders get tax cuts.”

All this “air” did not produce broad economic growth precisely because there were no strings attached forcing them to do so – the rabid capitalists merely shared the money among their elite friends. The failure to loan downward kept the “real” economy profoundly depressed in a self-defeating cycle: the failure to loan bailout money downward created a lack of confidence in the economic situation, which deterred economic activity, which created poor economic results, which then created more lack of confidence in the economic situation, which created more poor results, etc.

The everyday purchases of the people is always the main economic driver, just as the government always has the most measures to influence the economy. However, Western Liberal Democracy has always been constructed to benefit an autocratic aristocracy, and the war against a Socialist Democracy – which demands strings be attached and which demands efforts at just redistribution – has always been total. The idea that Europe post-2009 did not follow this long-time trend of history is obviously a total fiction: another fiction held dear by many in France is that the French government has more influence over the French economy than the government in Brussels, post-Lisbon Treaty.

How was the “air” in which central banks created unbacked trillions different from the “air” which private bankers accused Bitcoin of being based on? Bitcoin offers many advantages over the 19th century-based banking system: transactions without the usurious fees of private banks, plus the transparency and security provided by blockchain technology. Perhaps most important is that Bitcoin’s “air” has the credibility granted by being impossible to inflate via over-printing – this is precisely the credibility which Western fiat (paper) money had lost via no-strings attached bailouts and QE. The amount of Bitcoin which can ultimately be created and used is limited to 21 million – it’s a finite, public, international, secure system.

Crucially, Bitcoin was created precisely as a populist reaction against the obvious economic disaster which was created as result of the West’s reckless and inflationary over-printing (and then the irresponsible use of this money). The first ever block of Bitcoin, known as the Genesis block, was mined in January 2009. It contained a message which referenced an article by British newspaper The Times. The message read: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” Bitcoin is thus a response to the fact that Western Liberal Democracy is autocratic and oligarchic, and that it’s fascist-influenced economy suffers from a “subprime government” crisis.

Bitcoin is thus the biggest financial weapon against capitalism with Western Liberal Democratic characteristics since the cooperative. Unfortunately, Bitcoin is rather infested with an anti-government, rabidly individualist libertarianism – they fail to see that the blockchain technology upon which Bitcoin rests contains the same virtues of Socialist Democracy: communal, consensus, decentralised, transparent, egalitarian. Another issue which must be remedied is the fact that an estimated 1,000 individuals, known as “whales”, own 40% of the market and thus leave Bitcoin open to the same valuation manipulation, collusion and monopoly upon which modern capitalism is based.

A socialist-inspired usage of cryptocurrency will undoubtedly reshape global economics. It is now drastically destabilising the Western Bankocracy, but capitalism repeatedly demonstrates it needs no help in cyclically destabilising itself.

If a ‘Lost Decade’ falls but nobody reports on it, does it make it ‘Found’?

The term “Great Recession” is commonly defined as running from December 2007 through 2009, but this is a historical analysis which comments only upon the fortunes of the rich – they got bailed out, so the recession for the 1% is alleged to have ended by the start of 2010. However, for the average Frenchman the “Great Recession” has never ended but was continued all through the “Age of Austerity”.

“Economic austerity” contains four essential ideas:

Firstly, it’s the cutting of governmental social services – Liberalism hates “big government” precisely as a monarch hated the idea of even a small parliament. In practice, this means passing the costs onto households for what used to be provided by the government. Second, it’s refusing to invest taxes in or sell bonds for public infrastructure programs which would benefit the nation regardless of economic class – government policy must focusing on favouring the needs, success and confidence of the rich class. Thirdly, it is reducing worker stability and conditions in order to reduce profit drags for owners, bosses and stockholders. Lastly, it’s increasing the tax burdens on households and individuals in order to finance cutting taxes for the rich and corporations in the hope that the latter pair will good-shepherd the economy back to strong growth. Crucially, there can be no strings attached to such tax cuts, in the form of promises to hire, invest sensibly, etc., as that would make it not capitalism but socialist central planning.

By following these policies the economic growth which will eventually be produced is promised to be vastly superior to socialist central planning, and will also even render the governmental social safety nets inspired by socialism to become so cheap that they will become unnecessary for governments to provide. This is the precise central claim of modern Western Liberal Democracy, though never openly formulated as such because it is so obviously absent, distant and preposterous.

This set of policies is on the far-right of the spectrum of economic thought because it implicitly relies on the individual, autocratic, unaccountable decisions of a member of the rich elite class. It posits that by placating/encouraging/protecting/promoting the biggest owners of capital they will then willingly engage in economic practices which benefit the nation/bloc. This anti-statist (and thus anti-people/pro-person) “voluntarism” is also espoused by many libertarian/anarchist misleaders in the nascent Bitcoin community.

Cutting social services, refusing to invest and increasing taxes are obvious to all, but what exactly is “reducing worker stability and conditions”?

In brief, Eurozone capitalists want every member nation to go through the reactionary “Hartz Reforms” of pre-crisis Germany, which promoted part-time work and subsequently, of course, shot poverty and inequality through the roof. Almost half of work contracts in the Netherlands and 30% of those in Germany are part-time, something anathema to France. The German model is: part-time work + old age poverty + low wages + lower productivity + increasing inequality + finding neo-imperial advantages (Germany has found this in the former East Germany and the ex-Eastern Bloc – this is covered up in Western media just as any profit from neo-imperialism is covered up) + less public investment + just enough of a social safety net to prevent embarrassing mass homelessness = “being fiscally responsible”. Clearly, this is not the German model but the “American model”; it is the “precarious” model which has nearly always guided Western Liberal Democracy; it is Western imperialism turned inward – gutting the resources of their nation’s own people for the benefit of an international 1%.

So how did the Age of Austerity actually perform for the Eurozone?

In January 2018 the Eurozone officially achieved a “Lost Decade”: From 2008-2017 the average annual growth rate was 0.6%, which was a worse score than either of Japan’s two Lost Decades (1991-2010).

The news went completely unnoticed, although of course PressTV and I reported on it immediately. Because the Eurozone’s annual growth rate in 2017 was 2.5% the mainstream media were amazing in their apparent conspiratorial collusion to produce headlines like that of the Financial Times, who optimistically penned, “Eurozone growth hits highest figure in a decade”.

For comparison, from 1975-1987 the US, UK, Germany and France all had between 1.8-2.5% annual average growth, and this era is universally considered a recession era. From 1945-1975 France’s growth rate dipped below 4% in less than a handful of years.

China’s growth rate from 2008-17 was 7.4%, but Western financial media ran countless propaganda variations such as this headline from Fortune: “Why China’s GDP Growth Rate Tells Us Nothing About Its Economy”. Iranian growth over this decade was five times better than the Eurozone’s, at 3%, despite an ever-strengthening blockade. Cuba, which has far less resources than either China or Iran to combat an even longer international blockade, produced 2.8% growth over this time frame. We see clearly that presenting 2.5% growth as some sort of great achievement is clearly capitalist propaganda which hides its inferiority to Socialist Democratic economics. Western Liberal Democracy is good at preserving inequality, not at producing economic growth – the Social Democracy era (1945-75), contrarily, was ok at producing solid growth.

During this era France was on the brink of a headline-blaring “triple-dip recession” several times, only to be saved by the official reporting of a quarterly growth rate of 0.2% or less. Such repeated close-call accounting was never questioned by mainstream media journalists – who are usually even worse at economics than they are at basic math – or even in the financial media, which one assumes would be more rigorous for their investor-readers.

All other capitalist metrics revealed the depth of the economic distress: Eurozone GDP per capita averaged €29,400 in 2008, and achieved only 0.1% annual growth by 2016 to reach €29,700. Considering that “austerity” also passes the buck for social services, €33 more per year was undoubtedly not enough of an increase for the average person. Nominal GDP, dropped from €14.1 trillion in 2008 down to €11.9 trillion in 2016. The bloc’s debt-to-GDP ratio, so often used as further justification for austerity measures, went from 69% to 89% over this time period – the price tag of austerity cuts to national budgets (usually a median of roughly €12 billion annually in France) were obviously dwarfed by the huge taxpayer-funded banker bailouts. It was not a “Lost Decade” for bankers, but for the Eurozone’s citizens.

Just as “national finances” referred to the king’s purse in 1788, the Western Liberal Democratic “Bankocracy” cemented by the Lisbon Treaty stopped caring about these low rates of economic growth because their preferred sectors – finance, insurance and real estate (the FIRE sector), dominated by unproductive and parasitical “rentier” usury – became completely untethered from economic fundamentals. During this decade their favourite asset classes – bonds, stocks, real estate, luxury goods, Leonardo da Vinci paintings, cases of rare wine, etc. – all hit record highs despite the undeniable tanking of the real economy.

Thus everyone living under Eurozone austerity felt and knew the reality that all of the ECB’s “free money” had gone for nothing which benefited the average citizen nor society overall. It was unproductive “bad debt” because it did not strengthen the “real” economy by building any infrastructure, which would have improved the ease of doing business and thus increased state revenue; nor funded any pension, health or education programs, which would have reduced fiscal drags and produced productive tax streams; nor gone into wage increases which would have increased consumer demand and resulted in economic growth. Any of these would have qualified as “good debt”, which would have produced multiple euros for every euro invested. This is something which socialist-inspired countries comprehend, and explains their economic resilience during this decade of global recession.

Unsurprisingly, the net effect of QE on employment in the Eurozone was negligible, as economists say that job growth does not even begin until growth rates hit 1.5%. Unemployment in France thus steadily climbed to nearly 11%, a level unseen since the mid-1990s. It should be remembered that official unemployment rates should usually be tripled, as they generally avoid including the underemployed, those whose unemployment insurance has expired and those who have given up looking for work. In this era of the West, however, part-time work became the goal of austerity “reforms”. Indeed, “underemployment” is perhaps the dominant theme in the life of the average Westerner during this era. The unemployment rate in France would only decrease in the Macron era thanks to shameless number-rigging and ignoring entire official classes of unemployed persons – the mainstream media, ever-illiterate in basic economics, played along.

The official inflation rate from 2000-19 revealed an increase of over 30% in France, though trusting official figures on inflation is certainly to accept a drastic and wilful undercounting also based on shameless number-rigging and mainstream media sycophancy.

Yellow Vest: “We pay our taxes to support public media, and we pay to help privately-owned media as well, but they both relay the exact same opinions and exclude or slander any dissenting voices. All we are asking is that the diversity of opinions be respected, and we are telling these journalists to stop their censorship and propaganda.”

Frankly, there is no limit to the number of statistics which can be used to describe the economic failures of Western Liberal Democracy during this era.

Combined with economic repression was the actual repression of the Hollande era

The autocratic demand from Brussels for austerity required the restoration of police states unseen since the era of Hapsburg domination and Metternich.

This is epitomised by the fact that from 2015 through 2021 France was in a state of emergency for 4.5 years. The final two years of Hollande’s reign a state of emergency held, and when Macron took power one of the first things he did was to legalise, and thus normalise permanently, the excessive powers granted during the state of emergency.

Given the brutality against the Yellow Vests it’s entirely too easy to forget that the Hollande era was also an era of absolutely constant protests. I estimate that at least 10,000 citizens were arrested at anti-government protests during the Hollande era, with 20,000 hurt and truly countless tear-gassed and harassed by cops. Four thousand protesters were not just arrested but actually prosecuted during the 2016 labor code rollback protests alone, so how many more were obviously arrested but never charged? How many more would have been arrested and tried had not over 600 demonstrations been banned during the terrorist-related two-year state of emergency, with countless other protests strangled in the cradle?

The banning did not really work – France averaged about 10 protests per day prior to the coronavirus – because the undemocratic installation of the EU, Hollande’s backtracking on austerity and the economic failure of austerity provoked an absolutely massive backlash.

After his backtracking on austerity anti-government sentiment immediately ballooned: a 2013 poll showed that 70% of France viewed their politicians as corrupt, marking a 30 % increase in just three years. A tone of trying to criminalise social movements and intimidate politically-active citizens was set on March 2013, when one labor union activist in a crowd of 1,000 was shockingly fined €40,000 for participating in a non-violent rail protest in 2006. The fine was upheld.

Rail workers were targeted because they are the most combative protesters in France: they led both the 1995 and the 2019/20 general strikes, and also because they were about to take to the streets over the EU’s forced breakup of national control over France’s railways. The 2014 rail strike was the biggest labor movement since 2010, inspiring other movements – such as major protests in favor of Palestine – and brutal police tactics. However, Brussels could not be stopped here nor in 2019, when similar EU orders to privatise the air industry forcibly opened French skies.

In January 2015 the Charlie Hebdo attacks saw workers at the xenophobic journal killed over needless cartoons of Prophet Mohammad. Omitted in Western media coverage was that one cartoon showed Prophet Mohammad filming a pornographic movie and another other showed him bent over with a star where his anus would be. Pro-Charlie Hebdo marches would bring several millions to the streets of Paris in the name of tolerance, and then introduce essentially perpetual Islamophobia. Gay rights could only deflect for so long – France’s Liberalists needed Islamophobia to implement fascism’s creation of fractional identity politics, which deflects from majoritarian class politics.

Many wondered how the attackers could have fought in Syria, returned, be under police surveillance (one had already been jailed on terror-related crimes) and yet were still successfully able to carry out a terror attack? Adding to these questions was why terrorists would feel the need to take their state ID on a terror attack, much less be daft enough to leave it in their getaway car?

Regardless of how: the attack occurred, and Islamophobia has ruled the media-politico waves ever since. It was one attack of many in this violent era: At that time France had 20 foreign military operations in place. In 2014 Hollande had admitted that starting in 2012 he violated the EU arms embargo to militants in Syria by sending them cannons, machine guns, rocket launchers and anti-tank missiles. This was preceded in 2011 with France’s illegally airlift of 40 tons of weapons to Al-Qaeda-linked militants in order to overthrow Ghadaffi. As widely predicted, these arms would be used to destabilise the continent, and in 2013 Hollande would send troops to Mali, and without prior UN permission. In every attack from 2012 onwards these foreign interventions would be cited by seemingly every terrorist who was not deemed mentally unfit.

In May a “French Patriot Act” had been rushed into law to put everyone under mass surveillance, legalise computer hacking by the government and end the need for a court warrant. Much like the United States in the wake of 9/11, France’s judicial branch effectively stopped deciding on anything if the word “terrorism” was attached. France’s judicial branch no longer acted as a check and balance – they were simply sectaries: they branch merely had to be informed of decisions taken by the the executive branch, its ministers and its police.

Many said the new powers weren’t even necessary because France’s executive branch was already the most powerful in the West, but executive branch power grabs were indispensable during these first formal years of the pan-European project: Because the pan-European project cannot win approval via democratic votes they must increase the power of their executive branches, who then implement the policies ordered by Brussels.

Only a week after Charlie Hebdo Hollande brought back the “49-3” – an undemocratic legislative loophole (called a “bazooka” in France) which allows for the executive to force through laws without consulting parliament. The obviously autocratic tool had been used rarely since 1993, as it would be reprimanded at the voting booth. When it was used it was only for more limited issues, whereas here Hollande used it for the economic centrepiece of his term: the Macron Law, named after the young Minister of the Economy. Ominously foreshadowing his own autocracy, Macron brushed aside accusations of 49-3 as being anti-democratic by saying, “Is it democratic to keep procrastinating? There is a moment when you have to act.”

The autocratic 49-3 was used three times to pass the legislation of the Macron Law, and it drastically shook up France: at a time when the global “Je suis Charlie” (I am Charlie Hebdo) protests had convinced France they were the world’s leading light of liberty, Frenchmen knew there was an autocratic rot in their own government.

Culturally, while Sarkozy introduced xenophobia, Hollande made it mainstream (Macron would then legalise it). Hollande persecuted the Roma worse than Sarkozy and totally ignored the 2015 European Refugee Crisis which he was a major factor in perpetrating, thanks to France’s efforts to destroy Libya and Syria. 2015 saw refugees flood the streets of the working-class areas of Paris, adding to this era’s massive economic, cultural and governmental malaise.

When the El Khomri Law, aimed to be a Hartz reform for the French labor code, was announced for 2016 many in France were well aware that major protests lay ahead.

However, in November 2015 a state of emergency was declared – for the first time since it was used to forestall Algerian independence – in response to an atrocious massacre at a rock concert in Paris and two other coordinated attacks, causing 137 deaths. Once again fighters from Syria had returned to attack Frenchmen. This was not the deadliest day in France since World War II, as is often reported – in October 1961 some 300 peacefully protesting Algerians were killed, many thrown into the Seine River. However much the Hollande administration might have hoped the bloody flag of the Bataclan concert hall would smooth the passage of the labor code rollback, they were mistaken.

All of spring 2016 was near-daily strikes: oil refinery, electricity, air traffic controllers, railroads, garbagemen, pilots and dockworkers all held multi-week strikes in the biggest labor action since 1995. Riot police inflicted violence seemingly as often as there was a protest. Furthermore, every night in Paris for months were the unprecedented “Nuit Debout” (Up All Night) protests, which were hailed as an effort to create a new form of democratic politics. Hundreds, sometimes thousands, of protesters gathered at Place de la Republique to sit and discuss the disastrous political and social situation. Every single night police forced them to dismantle their camp, and every day they rebuilt it.

In this context of a terribly hard social spring Brexit occurred (June 2016), and the link is obvious: The disastrous and despised leadership of Brussels was on display every night just across the Channel. “Remainers” chose to blame racist rural citizens while “Leavers” exhaled at escaping a continent which had been mired in chaos since 2009. It’s appalling that the context of a disastrous 2016 is pushed aside as a reason for Brexit thanks to the privileging of an absurd xenophobic narrative. Given the decade’s political, economic and social disaster it’s amazing that there was only one “-exit”. However, the coronavirus would put a 1.5-year stop to all political protests.

After almost four months of near-daily protests, France’s prime minister finally agreed to sit down with labor unions for the first time – Macron clearly neither invented rubber-bullet liberalism nor the refusal of Western Liberal Democratic politicians to autocratically rule without discussion.

Hollande did eventually make some minor concessions to the labor code rollback, which were then used by Macron as a reason for quitting his cabinet. Despite public disapproval, Hollande rammed the final version through by 49-3.

Defying the mainstream media pundits, Hollande never made an about-face on austerity even if only to win-election. Instead, he threw in the towel before the ringing of the 2017 first round bell: he refused to stand for re-election. It was a first in French history, and one with few parallels in Western Liberal Democracy. His final approval rating was just 4%. Hollande thus was never held directly accountable by voters – he ruled like an autocrat and left on his own autocratic terms.

Yellow Vest: “This is an admission of weakness. The government is using the last advantage it has to increase the repression of protesters. The military already has a job to do when they are deployed inside France – to protect us from terrorism.”

Hollande was surely thinking something like, “One day they will look back and thank me”. Mikhail Gorbachev is probably thinking the same thing, too, as will Macron. The only persons thanking these elite imploders are their fellow elite.

The fault is in not repeatedly not predicting totally predictable consequences

The Lost Decade could have been limited to just 10 years – Europe’s Quantitative Easing was originally scheduled to end September 2017. Of course, realism about how capitalism works prevailed – rather than opening the door to European Sovereign Debt Crisis II it was accepted that Quantitative Easing could not end.

What added to the alarm is that a once-risky Eurozone situation has grown even more unstable, because the Eurogroup’s policies did not correct whatsoever – economically or politically – any differences in risk among the different nations of the Eurozone.

Further adding to the alarm is that the Eurogroup did not strengthen the resilience of the “real economies” in their member nations – austerity policies and labor code rollbacks have worsened the fundamentals of the “real economy”. Should something like a pandemic hit and strain finances, the results will be… well, we will soon find out.

There’s a life-or-death question for which Western Liberal Democracy still has no answer, at the time of publication, and which they do not want to ask: when the era of free money ends, and knowing that the 1% can never be satiated, how long do the devilish speculators wait to strike the poorer members of the Eurozone?

The other existential question facing the Eurozone is: How can any sort of redistributive, equalising era of “free money” for the 99% ever start when the solidarity required for a pan-continental project clearly does not exist? For Europe there must first be a political agreement on this question, which is the only way to finally create economic growth, equality and equal growth across its regions.

In May 2016 a team of economists from the International Monetary Fund admitted that austerity doesn’t work, that rising inequality was bad for growth and that governments should use controls to cope with destabilising capital flows. It fell on deaf ears among policy makers, who – as always in Western Liberal Democracy – refuse to employ socialist-inspired ideas to prevent the next looming inevitable bust in capitalism.

In August 2016 Nobel Prize-winning economist Joseph Stiglitz released perhaps the most popular American critique of Europe’s economic choices with, The Euro: How a Common Currency Threatens the Future of Europe. Stiglitz is perhaps the most prominent left-leaning economist in the United States, and I should note that he grew up in a small city in which I lived for several years: Gary, Indiana. Gary is the home of once-mighty US Steel, but which has been reduced into a regular contender for the per-capita murder capital of the world via globalisation, offshoring, White flight and total Western Liberal Democratic neglect.

“Austerity has always and everywhere had the contractionary effects observed in Europe: the greater the austerity, the greater the economic contraction. Why the Troika would have thought that this time in Europe it would be different is mystifying,” Stiglitz wrote.

It is not “mystifying”, but “left-leaning” economists and figures continually make this claim of, essentially, “but surely they had good intentions” even though we know that the capitalist opponents of Socialist Democracy routinely aim for and perpetuate catastrophic scenarios for the average person. What happened in the Eurozone has happened all over the 3rd World during the two-plus centuries of European-led imperialism: countries were flooded with loans from Europe which they could never repay, resulting in Westerners taking over government policy with an aim of picking apart the newly-indebted economies. This is what capitalism does over and over and over, from the Bey of Tunisia in the 1860s to Greece today. Stiglitz is guilty of viewing the Eurozone as some sort of isolated case in capitalism – it is his wilful insistence on remaining “mystified” which allows his merely left-leaning ideas to maintain mainstream dissemination.

“A cynic might say that this was the intent of the law: to preserve power relations. But I am convinced that the rule in Europe was driven more by ideology and misguided economic beliefs than narrow self-interest,” wrote Stiglitz.

It is not at all cynical to say that capitalists in the Eurozone have not yet rectified a long-standing criticism by the left: that capitalism needlessly and inefficiently promotes international competition and imperialistic rivalries.To say that the bankers, the Troika and top national politicians didn’t know what they were doing is pathetically collaborative. Worse, it shows that a Nobel Prize-winning economist doesn’t even understand how the Eurozone works post-Lisbon Treaty? It also lacks sufficient contempt for a negligence which undoubtedly produces mass suffering. But lacking contempt and rigour for Western capitalism while still making obvious criticisms is how a person such as Stiglitz becomes reportedly the fifth-most most frequently cited author on college syllabi for economics courses in the US.

Yet the fundamental misconception that high finance actually wants a “high-growth” model – but just can’t figure the darn thing out – is likely to persist. The true reality is that forced recession is a tool of social war against the 99% to restore 19th century living standards and rights. From 2018-2021 the Eurozone produced a growth rate of just 0.5% – it seems inevitable that the Eurozone will achieve a “Lost Score”, just as Japan did.

Five months after Brexit Donald Trump would be elected on a platform of “draining the swamp” in Washington of its corrupt, essentially uni-party political hacks, and also of ending “this American carnage”, a reference to the social destruction caused by the Great Recession. Trump would become one of the least warmongering US presidents in history, so some carnage was indeed reduced.

Would France follow the Anglosphere’s lead of rejecting mainstream political-economic ideology in favor of populism in their 2017 elections? The mainstream parties would lose, but not mainstream ideology. Since 1789 France has often rejected the ultimately right-wing politics of the Anglosphere, as mainland France has often followed the lead of other, rather unexpected, sources.

France’s overseas colonies are repeatedly at the crest of the wave of French politics, providing innovations which later spread to the mainland. We will see this with the Yellow Vests, but in spring 2017 French Guiana burst into the news with a General Strike, which demanded an end to their colonial status and far more autonomy.

It was amusing to see how France’s mainstream media printed promises that “the strikes are over” almost daily – an effort to strangle them in the cradle – but they would last three weeks. Just as historically notable was the arrival of a people’s militia called the “500 Brothers Against Delinquency”. The first rule of any government is to provide security for its citizens, but Guiana had been allowed to become the most violent “Overseas Département” of France. The citizens’ brigade wore masks, were called absolutely necessary by locals and were expectedly denounced by Liberalists as extralegal vigilante justice.

All 11 of France’s neo-colonies are rife with atrocious inequality and French-led hypocrisy, but none more so than French Guiana. Just as colonial England prohibited colonies like Barbados, Jamaica or Monserrat to manufacture even a needle or a horseshoe, so does France and the EU treat French Guiana as economic hostages. More than 60% of their imports are from France, but by prioritising France instead of trading with their neighbors the growth of French Guiana has been incredibly retarded. The advent of the EU made this situation one of the worst neo-imperial situations on record: Goods from nearby South American nations are blocked out by EU tariffs, thus the Guyanese have to favor goods from the Netherlands and Germany instead of from Venezuela and Brazil despite the obvious higher shipping costs. This arrangement is regularly called a “paradox” in the mainstream media, who is mystified as to how capitalism works, of course.

French Guiana is thus emblematic of how the Eurozone is a system which is rigged to increase inequality in favor of the rich as long as there is such an obvious absence of political solidarity among member nations. Such solidarity is anathema in Western Liberal Democracy, of course.

Because deficits and surpluses are inevitable between two nations which trade, there must be a multi-national mechanism/parliament/executive which redistributes wealth from surplus nations in the Eurozone to deficit nations in order to ensure economic balance and social/regional harmony. In the absence of such a mechanism a multi-national project like the Eurozone will never be able to create growth or equality for perpetually poorer members like Greece or French Guiana. Such areas are doomed to permanent debtor/deficit nation status, with all the loss of real political influence to 2012’s “gang of four” that obviously entails.

What the Age of Austerity proved is that European elite are not only opposed to a redistribution of wealth among classes, but also to any redistribution of wealth among nations sharing the euro. This is not an economic question but a political one, because only a government intervention – a political agreement/decision – can create equality, growth, and equal growth across Eurozone regions. However, many in the Eurozone still believe that their national governments are in charge, despite all of this era’s evidence to the contrary.

The future of the Eurozone is so hopeless because the Bankocracy which controls it will never promote or allow political agreements which redistribute wealth and political power. The spirit of 1789 has been supplanted by a Western Liberal Democracy which takes many cues from fascism, and this would be encapsulated in France by Emmanuel Macron and then bravely opposed by the Yellow Vests.

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Upcoming chapter list of the brand-new content in France’s Yellow Vests: Western Repression of the West’s Best Values. The book will also include previous writings from 2018 through the 2022 election in order to provide the most complete historical record of the Yellow Vests anywhere. What value!

Publication date: July 1, 2022.

Pre-orders of the paperback version will be available immediately.

Pre-orders of the Kindle version may be made here.

Pre-orders of the French paperback version will be available immediately.

Pre-orders of the French Kindle version may be made here.

Chapter List of the new content

Ramin Mazaheri is the chief correspondent in Paris for PressTV and has lived in France since 2009. He has been a daily newspaper reporter in the US, and has reported from Iran, Cuba, Egypt, Tunisia, South Korea and elsewhere. He is the author of ‘Socialism’s Ignored Success: Iranian Islamic Socialism’ as well as ‘I’ll Ruin Everything You Are: Ending Western Propaganda on Red China’, which is also available in simplified and traditional Chinese.