Austerity is yet again the name of the game as the deal between Cyprus and the ‘Troika’ (IMF, ECB and EU) is completed; a Cypriot with over €100,000 in their bank account can now expect to lose nearly half of that money. This leaves many in Cyprus, who were against such a move and had little or nothing to do with its origins, with a sense of confusion, frustration and even anger; which is starting to become commonplace with many Europeans.
Monday 25th March saw the European Central Bank confirm that they will not ‘pull the plug’ on Cyprus. The deal will see the two major banks of Cyprus merge into one. Those who have over €100,000 in an account with the Bank of Cyprus will be taxed 30-40% of that money. Other measures such as privatisation and tax increases shall be enforced in order to raise the €5.8bn required for a €10bn bailout from Europe.
In Cyprus the banks have been closed for days now, people cannot withdraw money to feed their families. Protests range from bank workers outside their place of ‘work’ to secondary school students (children!) outside the parliament in Nicosia. In a familiar narrative that seems to run throughout recent protests against austerity and irresponsible capitalism, the people know little of how this financial crisis happened or what to do, they only know it wasn’t their fault and therefore shouldn’t be stuck with the consequences. This is a simple and convincing logic, but not entirely fair.
The three way relationship between democracy, economics and people, is fast becoming a distant relationship. Italy has recently seen an unelected Prime Minister do some good work in meeting fiscal targets but at the price of a 6% rise in youth unemployment (up to 36% during Monti’s time in office) and a recent election where one of the main conclusions to be drawn from it is that many Italians are wary of politics and politicians. Dutch finance minister Jeroen Dijsselbloem suggested the deal struck with Cyprus was a ‘blueprint’ for further action in these situations, with some economics commentators suggesting that if €100,000 is the only amount of money safe in European bank accounts then why deposit more? Hide the rest under your mattress? Spread savings across various banks? How can banks operate if the only reason people use them is because a certain amount is protected/insured by the European Union? In this scenario it seems that banks might as well be state run, cutting out the middle man.
In all of this, the people (or those that define themselves as the 99%) cannot be left without any responsibility. It could be faith in the democratic process or blissful ignorance but there seems to be a lack of engagement in what are crucial issues in the world today. The issues are political and economic and certainly have little to do with what is happening in Eastenders or who’s poking who on Facebook. Parents who worry for the future of their children wouldn’t be far off the mark outlining the basics of ‘credit’ in the same breath as the one that says ‘if you really must, wear a condom’; an ill informed decision in either scenario could change a young life forever.
Will any form of positive change occur from apathy or a stone wall distrust of politics? Doubtfully, in fact the democratic process and the political institutions we have in Europe are the product of millions dying and even more suffering. You may not care how anymore but WHY people died and suffered is a very easy history lesson that doesn’t even go back that many years. I recommend ‘WW2 for Dummies’, it has all sorts of wonderful examples of what happens when economic and political times are hard in Europe and especially when people are angry at living with the consequences of something they believe is not their fault.