Employment, Wages, Public Services and Public Debt in Spain and the EU, 2000-2010: the Negative Impact of Unfair Competition and Industrial Decline

Resumen

We analyse the causes and consequences of industrial decline of Spain and EU countries during the period 2005-2010, particularly in relation with their negative effects on employment, wages and public services, as well as on the increase of public debt. We agree with prestigious authors who recommend development policies, instead of austerity policies, to diminish public debt and at the same time to increase the rate of employment and real wages. Industrial policies should be improved both in Spain and in the EU countries with current account deficits in order to reach a more even current account balance and to foster development in other sectors, favouring a diminution of public deficit. Improvement of industrial policies in the EU require support to European industry, as it has been suggested by several trade unions, business organizations, economists and other experts, in order to avoid unfair competition with goods produced in countries with clearly lower taxes and other charges, particularly when the unfair competition causes high deficits in current account balance. Globalization should lead to EU contribution to arise the quality of life both of their citizens and of those of other countries, but not to lower the wellbeing levels of European to the level of poorest countries. This is the general wish of European society and that should be the main goal of EU authorities. To reach a higher level of agreement between EU policies and citizens it is of uppermost importance to get real improvements in EU institutions making them more democratic and more efficient in solving problems.