May 25, 2013
Spain’s EuroVegas, or the art of being free
Financial crisis leading to total deregulation?
A shot of cortisone for the eurozone. This is the way the markets understood the bespectacled head of the European Central Bank’s big remedy, unveiled to great fanfare and adulation last week as the last flourish of an Olympic summer. But ECB chief Mario Draghi also made it clear that the injection comes with strings. Once the pleasing sedatives of bottomless money supply have drained from the blood, the tired old bodies of Spain, Ireland, Portugal or Greece will still face the task of raising themselves from their beds and lurching to the workfloor.
When they get there, they may well find the landscape rather different from the one seen five years ago. Gone and going are the multiple contractual clauses, the protection against summary dismissal, limits on when to work or for how many hours, the bonuses, perks and coffee breaks. The infamous European troika, which patrols the finances of the three countries in bailout (excluding the half-way case of Spain), demanded last week that the Greeks extend the working week to six days across the entire labour force. In a televised address to the nation on Friday evening, the Portuguese Prime Minister Pedro Passos Coelho solemnly announced a universal hike in social security payments, which will, in one fell swoop, cut wages by seven percent.
The public’s “ouch” is audible. But what, the Keynesian sceptic may ask, will be the payback for all this slicing to the bone? Fortunately, the return from summer holidays has also gifted Europeans with snapshots of a more glorious, job-rich future. The continent’s largest gambling and leisure centre, comprising according to current plans a complex of 12 hotels, six casinos, three golf courses and a concert hall with capacity for 15,000 people, is now slated to be built on the dirt-dry terrain of suburban Madrid. EuroVegas, the brainchild of Sheldon Anderson, US casino mogul and Tea Party fetishist, will spill like a Xanadu of cash-tills over the plains, while an estimated 260,000 people will find employ in service of the pleasure dome.
Critics of this surrender to vice should beware. It is a brave investor who currently ventures into Spain, and the most forthright voice on the subject of how to tempt new business is that of Madrid’s arch-Thatcherite leader, Esperanza Aguirre. At her behest, the region recently ruled that shops can open at any time, on any day. To tempt EuroVegas, it has apparently made further extraordinary concessions: restrictions on smoking and ten years of taxes will be waived.
It may appear that the tide toward total business deregulation is only high in the teetering countries of the Mediterranean, where attracting jobs is a national emergency. Northern Europe, on the other hand, still claws onto its labour privileges, as shown in the victory of François Hollande in France and the likely centre-left outcome to Dutch elections this week. Britain’s Tory government, however, shares the liberating ideology, and is now reconsidering whether to lay down a third runway in Europe’s busiest airport, Heathrow. Prime Minister David Cameron’s Cabinet reshuffle last week also came with the pledge that he would “cut through the dither that holds this country back.” His call for sinew, robustness and valour was duly followed a few days later with the only growth policy of note that has been seen out of Britain for over a year: homeowners and businesses now have 12 months to make any extensions or alterations to their properties without asking for planning permission, thereby replacing dither with a nice new conservatory, or maybe a Mock Tudor façade.
In this way, the newborn workers of Britain, the Mediterranean, and possibly at some future stage the rest of Europe, will march toward a new world, where they may be endlessly available, utterly dispensable, and manically productive. And should the workers of the future have any spare time on their hands, they will have many different ways of spending it: falling off the roof, losing one’s life savings in roulette, or chain-smoking like it was 1970. It may not resemble the giant programmes of industrial expansion and urban growth now under way in China, nor the pre-salt oil fields and soya baskets enjoyed by Brazil, but at least it keeps the money circling.
Such are the joys of the sole growth policy in town at the moment: freedom, which, as the Bush administration in the United States regarded it, is not just a word, but an agenda. Whereas Draghi and his peers in Europe’s financial and banking elite devise ever more complex mechanisms of administration and intervention, conditioning every national spending decision on the approval of multiple viceroys and minders, lower down in the food chain the general public is being advised to shed as many legal inhibitions as possible.
Of course, freedom comes in many sizes. The philosopher Isaiah Berlin, the recent subject of a column in this paper by Robert Cox, identified two broad sorts. Yet why stop at two? Travelling to the top of Maslow’s pyramid of human needs, we might describe each layer as that of new freedom: freedom from hunger, freedom from insecurity, and eventually, at the pinnacle, freedom to find oneself. Indeed, it sometimes seems virtually any desirable act of thing can be packaged as an extension of one’s liberty to do whatsoever one pleases, even if this involves 16 hours a day hunched over a luminescent screen with a scrap of bio-salami for nourishment.
In fact, the most curious thing about today’s freedom is that in crawling to its maximum ascendance in the deregulated, tax-free, 24/7 pleasure parks of the future, it will depend on the support of Mario Draghi and victory of his system.