“The conclusions of the 2020 economic forecast are no surprise, they confirm what we know already: We are facing the threat of an unprecedented fast-track to economic recession and unemployment.
An unprecedented effort is therefore needed by the EU to support Member States to keep the downturn at bay as much as possible. The last crisis, which also started abruptly with a sudden implosion of financial systems, resulted in an economic and then social crisis whose consequences we still feel today. The policy reaction throughout Europe was austerity and budget cuts. It is clear that this made the economy and societies vulnerable, as cuts in public services reduced the resilience of the state and the society to face crises. It is tragic and ironic that the budget cuts from the last crisis have aggravated the current pandemic crisis in many Member States. Spain or Italy would have fared better -and in the end saved money!- and have had fewer deaths if their health systems had not been drained through cuts in facilities, equipment and staff. Expenditure in quality public services is no cost, it is an investment that will more than pay off in the long term.
What we need now is an EU that shows a clear commitment to performing public services and to an investment agenda of unprecedented scope. We must patch up past mistakes and make our states more resilient again, and at the same time we must take measures for job creation, consumption demand and a socially friendly ecological transition of our economies.
Investing now in resilient societies and public services will not come cheap. But it is clear that under-investing as during the last 10 years and risking high unemployment will be more expensive. The EU’s recovery plan should reflect this, and the EU should streamline its fiscal and economic governance system to encourage more necessary public investments in the Member States.”