A summary of the well-known economic problems:

The economic and social development in the EU is marked by the end of the weak recovery and by falling growth rates with rising unemployment and again lower wage shares which indicate a further deepening of inequality in Europe. The negative macroeconomic picture is to a large degree influenced by the weak performance of Germany and Italy while other countries fare much better. The particularly strong redistribution from wages to profits had the effect that real domestic demand in Germany in 2005 was lower than in the year 2000. Poverty, and particularly child poverty in the EU, is on average still at unacceptably high levels, with on the one hand the exception of the Scandinavian countries and, on the other hand, particularly scandalous figures for the United Kingdom.

They critique the conventional wisdom as embedded in the economic proposals of the European Commission:

In a move of apparent modesty the European institutions are now about to adopt a new kind of European minimalism:

• Firstly, they launched a second version of the Lisbon agenda, the "new partnership for growth and jobs" which is considerably less ambitious, has less objectives and benchmarks, and concentrates almost exclusively on growth and jobs. The social quality of jobs and the ecological sustainability of growth in this agenda are pushed even more to the background than before.

• Secondly, they declare the intention to cut back on red tape and reduce the number of European rules and provisions in the interest of citizens. Welcome as such removal of bureaucracy may be in theory, in practice it includes attacks on standards for health or environmental protection.

• Thirdly, another important aspect of European minimalism is reflected in the determination to further reduce the already much too small European budget, allegedly to ease the tax burden for the citizens.

What remains after such correction of "over-ambitious visions" for Europe is the trust in open markets, deregulation, competition, and flexibility. In reality the new modesty in the current minimalist policy reflects and reinforces the core programme of neoliberalism.

What's their proposed alternative?

Against this narrowing of the perspective for European development we propose to broaden the perspective and enhance the ambitions towards a comprehensive European development strategy. This includes on the one hand a widening of the strategic scope to include with equal weight economic, social and ecological perspectives, and to establish a real - as opposed to rhetoric - balance between the economic, social, and ecological dimensions of social life and European integration. For economic policy on the other hand it means a broadening and enhancement of the range of measures and tools, which should include more intensive macroeconomic and structural intervention, stricter rules for capital, and a broader use of the public sector.

-- The objective of full employment should be maintained and instruments to achieve it should be:

• a large public investment programme, of the size of 1% of EU GDP, primarily in the areas of ecological restructuring;

• an extension of public employment in social services, education, utilities, and network services, and

• a new effort for working time reductions.

-- A more employment friendly macroeconomic framework.

• Monetary policy should be relaxed through a reduction of the central interest rate in the Eurozone by 50 basis points to 1,5%.

• Monetary policy should be embedded into a democratic process of discussion and decisions of economic priorities.

• Coordination between monetary and fiscal policies must be intensified.

-- The EU should reinforce its social policy and to this purpose:

• enhance its tools and financial resources to fight poverty and social exclusion in the Union,

• promote the adoption of - differentiated - minimum standards for social welfare throughout the Union, with strict barriers against the reduction of existing standards, and

• use the open method of coordination to promote a public Pay-as-you-go system for pensions which ensures a decent standard of living for the elderly.

-- More proactive structural policies.

• Regional policies must be reinforced to facilitate more rapid catch-up processes of weaker regions.

• A necessary strengthening of industrial policies should ensure that interests of regions and workers are taken into account in European corporate restructuring.

• A reform of the Common Agricultural Policy should give developing countries more access to EU markets while at the same time safeguarding the European basis for agricultural production.

• On the basis of a broad debate about the main orientation of innovation and technological development policies should be considerably strengthened on a European level.

-- To respond to the increasing costs for traditional energy and to contain global warming the EU should act much more pro-actively to promote a new energy regime which is primarily based on renewable (solar) energy sources.

-- To enable the EU to launch relevant initiatives for the above objectives it is necessary to considerably raise the size of the European budget, while at the same time ensuring democratic procedures and transparency. We propose to increase the European budget from its present level of a little more than 1% of European GDP by 0,5 percentage point every year until it reaches about 5% of GDP. At the same time the revenue basis should be reformed to the effect that the main source of the EU budget would be a progressive GDP-related European income tax.

So here is one alternative proposal. Some questions:

• What do ET'ers think of the general thrust of the document?
  
• Of specific proposals?
  
• Are there things we have been working on that could supplement this? (I'm thinking of Jerome's work on energy policy for example).
  
• How can we better publicize this kind of endeavor to fight back against the free-market fundamentalists?

Here are some names on the list:

Nicola Acocella, Italy
Philip Arestis, UK
Dean Baker, USA
Y. S. Brenner, Netherlands
James K. Galbraith, USA
Susan George, France
John Grieve Smith, UK
Robert Guttman, USA
Helen Ginsburg, USA
Bob Jessop, UK
Jonathan Michie, UK
Malcolm Sawyer, UK
Grahame Thompson, UK
Pascal Petit, France
Geoffrey Hodgson, UK

(No, the full list is not dominated by the UK and US, these are just people that I happen to have heard of, probably because they write in English).