Our World in 2017

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ISSUE#1193 | January 2017 SOCIETY IN BLOOM NEW EUROPE: OUR WORLD IN 2017 Page-42 www.neweurope.eu by George Soros Chairman of Soros Fund Management and of the Open Society Foundations, is the author of The Tragedy of the European Union: Disintegration or Revival? USA - NEW YORK Well before Donald Trump was elected President of the United States, I sent a holiday greeting to my friends that read: “These times are not business as usual. Wishing you the best in a troubled world.” Now I feel the need to share this message with the rest of the world. But before I do, I must tell you who I am and what I stand for. I am an 86-year-old Hungarian Jew who became a US citizen after the end of World War II. I learned at an early age how important it is what kind of political regime prevails. The formative experience of my life was the occupation of Hungary by Hitler’s Germany in 1944. I probably would have perished had my father not understood the gravity of the situation. He arranged false identities for his family and for many other Jews; with his help, most survived. In 1947, I escaped from Hungary, by then under Communist rule, to England. As a student at the London School of Economics, I came under the influence of the philosopher Karl Popper, and I developed my own philosophy, built on the twin pillars of fallibility and reflexivity. I distinguished between two kinds of political regimes: those in which people elected their leaders, who were then supposed to look after the interests of the electorate, and others where the rulers sought to manipulate their subjects to serve the rulers’ interests. Under Popper’s influence, I called the first kind of society open, the second, closed. The classification is too simplistic. There are many degrees and variations throughout history, from well-functioning models to failed states, and many different levels of government in any particular situation. Even so, I find the distinction between the two regime types useful. I became an active promoter of the former and opponent of the latter. I find the current moment in history very painful. Open societies are in crisis, and various forms of closed societies – from fascist dictatorships to mafia states – are on the rise. How could this happen? The only explanation I can find is that elected leaders failed to meet voters’ legitimate expectations and aspirations and that this failure led electorates to become disenchanted with the prevailing versions of democracy and capitalism. Quite simply, many people felt that the elites had stolen their democracy. After the collapse of the Soviet Union, the US emerged as the sole remaining superpower, equally committed to the principles of democracy and free markets. The major development since then has been the globalization of financial markets, spearheaded by advocates who argued that globalization increases global wealth. After all, if the winners compensated the losers, they would still have something left over. Open society needs defending Russian President Vladimir Putin attends a State Council meeting at the Kremlin in Moscow. EPA/NATALIA KOLESNIKOVA/ POOL The argument was misleading, because it ignored the fact that the winners seldom, if ever, compensate the losers. But the potential winners spent enough money promoting the argument that it prevailed. It was a victory for believers in untrammeled free enterprise, or “market fundamentalists,” as I call them. Because financial capital is an indispensable ingredient of economic development, and few countries in the developing world could generate enough capital on their own, globalization spread like wildfire. Financial capital could move around freely and avoid taxation and regulation. Globalization has had far-reaching economic and political consequences. It brought about some economic convergence between poor and rich countries, which was beneficial; but it increased inequality within both poor and rich countries, which was harmful. In the developed world, the benefits accrued mainly to large owners of financial capital, who constitute less than 1% of the population. The lack of redistributive policies is the main source of the dissatisfaction that democracy’s opponents have exploited. But there were other contributing factors as well, particularly in Europe. I was an avid supporter of the European Union from its inception. I regarded it as the embodiment of the idea of an open society: an association of democratic states willing to sacrifice part of their sovereignty for the common good. It started out at as a bold experiment in what Popper called “piecemeal social engineering.” The leaders set an attainable objective and a fixed timeline and mobilized the political will needed to attain it, knowing full well that each step would necessitate a further step forward. That is how the European Coal and Steel Community developed into the EU. But then something went woefully wrong. After the Crash of 2008, a voluntary association of equals was transformed into a relationship between creditors and debtors, where the debtors had difficulties in meeting their obligations and the creditors set the conditions the debtors had to obey. That relationship was neither voluntary nor equal. Germany emerged as the hegemonic power in Europe, but it failed to live up to the obligations that successful hegemons must fulfill, namely looking beyond their narrow self-interest to the interests of the people who depend on them. Compare the behavior of the US after WWII with Germany’s behavior after the Crash of 2008: the US launched the Marshall Plan, which led to the development of the EU; Germany imposed an austerity program that served its narrow self-interest. Before its reunification, Germany was the main force driving European integration: it was always willing to contribute a little bit extra to accommodate those putting up resistance. Remember Germany’s contribution to meeting Margaret Thatcher’s demands regarding the EU budget? But reuniting Germany on a 1:1 basis turned out to be very expensive. When Lehman Brothers collapsed, Germany did not feel rich enough to take on any additional obligations. When European finance ministers declared that no other systemically important financial institution would be allowed to fail, German Chancellor Angela Merkel, correctly reading the wishes of her electorate, declared that each member state should look after its own institutions. That was the start of a process of disintegration. After the Crash of 2008, the EU and the eurozone became increasingly dysfunctional. Prevailing conditions became far removed from those prescribed by the Maastricht Treaty, but treaty change became progressively more difficult, and eventually impossible, because it couldn’t be ratified. The eurozone became the victim of antiquated laws. Muchneeded reforms could be enacted only by finding loopholes in them. That is how institutions became increasingly complicated, and electorates became alienated. The rise of anti-EU movements further impeded the functioning of institutions. Disintegration received a powerful boost in 2016, first from Brexit, then from the election of Trump in the US, and on December 4 from Italian voters’ rejection, by a wide margin, of constitutional reforms. Democracy is now in crisis. Even the US, the world’s leading democracy, elected a con artist and would-be dictator as its president. Although Trump has toned down his rhetoric since he was elected, he has changed neither his behavior nor his advisers. His cabinet comprises incompetent extremists and retired generals. What lies ahead? I am confident that democracy will prove resilient in the US. Its Constitution and institutions, including the fourth estate, are strong enough to resist the excesses of the executive branch, thus preventing a would-be dictator from becoming an actual one. But the US will be preoccupied with internal struggles in the near future, and targeted minorities will suffer. The US will be unable to protect and promote democracy in the rest of the world. On the contrary, Trump will have greater affinity with dictators. That will allow some of them to reach an accommodation with the US, and others to carry on without interference. Trump will prefer to make deals rather than defend principles. Unfortunately, that will be popular with his core constituency. I am particularly worried about the fate of the EU, which is in danger of coming under the influence of Russian President Vladimir Putin, whose concept of government is irreconcilable with that of open society. Putin, is not a passive beneficiary of recent developments; he worked hard to bring them about. He recognized the weakness of his regime: it can exploit natural resources but cannot generate economic growth. He felt threatened by “color revolutions” in Georgia, Ukraine, and elsewhere. At first, he tried to control social media. Then, in a brilliant move, he exploited social media companies’ business model to spread misinformation and fake news, disorienting electorates and destabilizing democracies. That is how he helped Trump get elected. The same is likely to happen in the European election season in 2017 in the Netherlands, Germany, and Italy. In France, the two leading contenders are close to Putin and eager to appease him. If either wins, Putin’s dominance of Europe will become a fait accompli. The trouble is that the method Putin has used to destabilize democracy cannot be used to restore respect for facts and a balanced view of reality. I hope that Europe’s leaders and citizens alike will realize that this endangers their way of life and the values on which the EU was founded. With economic growth lagging and the refugee crisis out of control, the EU is on the verge of breakdown. The EU is set to go through an experience similar to that of the Soviet Union in the early 1990s. Those who believe that the EU needs to be saved in order to be fundamentally reinvented must do whatever they can to bring about a better outcome. Copyright: Project Syndicate, 2016. www.project-syndicate.org
ISSUE#1193 | January 2017 SOCIETY IN BLOOM NEW EUROPE: OUR WORLD IN 2017 Page-43 www.neweurope.eu by Luk Zelderloo Secretary General of the European Association of Service providers for Persons with Disabilities (EASPD). There is no path to social inclusion, social inclusion is the path BELGIUM - BRUSSELS 2017 will mark a turning point for Europe and social inclusion is the best way forward. In my view, social inclusion is about me respecting you, you respecting me, valuing our contribution to society, empowering one another and ensuring we both live in dignity. Growing disillusion must be tackled at the source: social exclusion With elections in many European Union (EU) countries -including France, Germany, the Netherlands, the Czech Republic and most probably Italy-, 2017 offers plenty of opportunities for people and politicians to voice ideas and concerns. Extreme parties are attractive to many and it is easy to understand why. The quality of life of too many people has stalled (at best), with disillusion growing. Brexit and the US elections are clear signs of this. The exasperation has been successfully picked up by the extremes, who rightfully criticise the malfunctioning system yet offer simplistic and dangerous solutions. Today, the simple understanding that all people should have their basic human rights guaranteed is understood by many as the establishment imposing their views on people. Political correctness is now attached to a system which has failed to support too many people. We must learn from this: human rights and respect for the other can only be achieved if they are applied to all people on an equal basis. Given the increasing complexity of our world today and the problems we encounter, there is no easy solution. But there are priorities. I believe the priority should be empowering people, providing real opportunities for all and creating hope for a better future. An economic mind-set focused on social inclusion is required Social welfare systems play an essential role here, yet they are too often undermined on a constant basis; if not in words, at least in investment. The fact that this has also gone alongside a rise in precarious employment, replacing what were once secure jobs, also plays an important role in this regard. There should be no surprise that this molotov cocktail of economic and employment policies has led to distrust in the system, especially by those who have not benefitted from it. Just look at the situation of persons with disabilities. Up to 70% of disabled people of working age are either out of work or economically inactive. There is significant proof that this can change –in part- through the development of quality person-centred services, inclusive education systems and effective employment support. Most costbenefits studies demonstrate that there is also an economic return for taxpayers to Participants of the third Rehab Critical Mass wheel chair march are seen on the Chain Bridge in downtown Budapest, Hungary, 29 May 2016. The event aimed to raise people's awareness of persons with disabilities who suffer from social exclusion and diffilculties. EPA/TAMAS KOVACS Up to 70% of disabled people of working age are either out of work or economically inactive. There is significant proof that this can change –in part- through the development of quality person-centred services, inclusive education systems and effective employment support. develop such inclusive models. There is also clear evidence that EU Member States with higher numbers of workers in health and social care have higher overall life satisfaction rates. Countries with strong health and care services have –on average- responded better to the economic crisis. Yet, for decades, the political trend has been to weaken public interest in social cohesion and inclusion, resulting in real cuts to public expenditure in social care and support services; sometimes dramatically. This has clearly had a counter-productive effect on the inclusion of millions of people in Europe; placing additional strain on their ability to access quality care and support services. This has an often underestimated impact on their quality of life and opportunities to access quality education and jobs, leading to a loss of trust in the system and on their hope for a better future. Social inclusion is not an ideological issue When significant evidence points to quality of life and social inclusion being linked to a strong health and care services sector, it is not ideological to question the economic and fiscal trends of the past decade. The International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD) have also reached the conclusion that the austerity-led economic policies of the past decades have failed to effectively tackle inequalities, despite higher levels of equality being essential for economic growth. The priority should be about what works for inclusive societies and what does not. It is about ensuring that all people have the sense that society is both working towards their empowerment and providing a safety net in case something goes wrong. It is about all people having a level of control over their opportunities in life. Learning from mistakes: time to invest in people We have to be bold, we have to learn from our mistakes, we have to invest in social inclusion and we have to give people hope that the system is working … for them. This requires a change in mind-set for many leaders, putting inclusion at the highest point of our political agenda. The EU might be on the right track with the European Pillar of Social Rights. It is a great opportunity to develop an action plan for investment in social rights. Such a plan has to link the Pillar to more flexibility for social investment, a strong cohesion policy and a Juncker Investment Plan geared for social infrastructure. Whereas civil society organisations are reasonably strong at European level, this should be strengthened on the political front by structurally involving civil society on an equal basis to social partners in the development of EU policies. This would help to better inform the EU of the concerns and ideas of those fighting for social fairness and vice versa. Business as usual risks putting Europe on a dangerous path, possibly even leading to armed conflict over the next few generations. We all have a responsibility to stop this from happening. I believe a strong, united Europe, prioritising social inclusion, is the best way forward to ensure a secure and prosperous future for all.
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It’s all about connections At AT&
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