SOCIALIST LEADERS:SOCIALIST leaders from Germany and France have warned that austerity measures alone will not solve the euro zone crisis. As French and German leaders met yesterday in Paris, the French socialist hoping to unseat President Sarkozy next year travelled to Berlin.
Addressing the Social Democrat (SPD) party conference, François Hollande warned that markets would not wait for European treaty change and called instead for “dynamic compromise” between French and German economic traditions.
“We are aware no country can teach another lessons and that isolation or stubbornness are the worst attitudes,” he told the SPD conference. “The Europe we want cannot be reduced to an organisation of austerity measures, with unemployment on the march and recession looming.”
SPD leader Sigmar Gabriel said a run of regional election wins in Germany, together with Mr Hollande’s poll lead in France, suggested a “new era” was looming in Europe. “The centre in Germany and the centre in Europe is once more centre-left,” he said.
“Centre-left” is Mr Gabriel’s answer to the dilemma he faces: readying his party for office by appealing to the SPD’s strong left-wing without putting off centrist floating voters. Playing to the centre and disillusioned Free Democrats (FDP), Mr Gabriel said his SPD was the true home of liberalism and wanted citizens to be “true masters of their own lives”.
“You all know Helmut Schmidt’s sentence, ‘Whoever has visions should go to a doctor’,” he said. “Well, with respect to Helmut, I don’t agree: whoever has visions should come back to us.”
To left-wingers, he said the SPD would “never again call into question the value of work” – a nod to lingering left-wing resentment at decade-old economic and welfare reforms without an explicit promise to roll them back.
Mr Gabriel promised a “market that conforms to democracy, not a democracy that conforms to the markets”, but touched on neither eurobonds nor the European Central Bank.
Not so Mr Hollande, who demanded a larger bailout fund, eurobonds and for the ECB to react better to real economic conditions – though within its existing independent statute.
He said the continued push of austerity measures and rise of bureaucratic governments risked undermining the democratic legitimacy of the EU. “I share the fear of your great philosopher Jürgen Habermas,” he said. “Wherever democracy and politics pulls back, the market moves in.”