Ending Austerity and the Eurozone Crisis

We will put an end to the brutal policy of austerity, providing a comprehensive plan to address the crises of public debt, private debt, trade imbalance, and regional inequality in the Eurozone.


Expanding the EU Budget

New measures to expand the EU budget while matching it with own resources

The EU budget is a vital resource of investment for all EU member-states. We will introduce new measures to expand the EU budget, while matching these spending commitments with EU own resources. We will develop several avenues for raising the revenue for this ambitious budget, including a carbon tax to curb climate change, a tax on financial transactions, and the introduction of new Eurobonds to finance infrastructure projects across the EU, among others.

Public Debt Conversion

A plan for member-states to convert their unsustainable debt

The Maastricht Treaty has put a harsh limit on member-state debt. However, since 2008, most member-states have exceeded this limit. The Eurozone needs a sustainable solution to this problem. We will offer the opportunity for member-states to convert their debt with a loan serviced by the European Central Bank at a very low rate, reducing debt burden in the short-term and — due to the low rate — in the long-term, as well. We will also ensure that the ECB is protected from losses by ensuring that its new liabilities are given priority over its other obligations, and by forcing the European Stability Mechanism to ensure their bonds, as well.

Private Debt Restructuring Organisation

A new agency to protect families and community banks from bad debt

We are proposing a new agency to protect families that are struggling with debt and to support community banks from non-performing loans. The worst of the bad debts will be moved to a Private Debt Restructuring Organisation in exchange for tax credits of an equal value. As the debt is being processed, we will introduce a moratorium on home foreclosures and auctions, allowing debtors to pay rent directly to the PDRO. Finally, when they are solvent again, debtors will have the right to buy their house back from the PDRO.

European Clearing Union

We are calling to rebalance Europe’s lop-sided trade relations

To address economic inequality in the EU, we need to think beyond the EU budget. Countries that consistently run large trade surpluses push down demand in the global economy, hurting all. Conversely, countries with consistent trade deficits can easily fall into debt crises. That is why we are calling for a European Clearing Union (ECU) that will rebalance Europe’s lop-sided trade relations. The ECU would create a common accounting unit, and it would evaluate each country on how much it exports or how much it imports. The ECU would tax countries with high levels of trade surplus, and it would use these additional funds to invest in regions that lack access to investment resources. In this way, the ECU will significantly reduce the structural inequalities between EU member-states. In addition, the ECU will incentivise countries with large trade surpluses to stop “living beneath their means” and increase wages and investment, reducing inequality within countries, as well.

Democratising the ESM

Bring the ESM under democratic jurisdiction

Europe’s most powerful economic institutions should belong to the people. We will fight for the European Stability Mechanism to be placed under EU jurisdiction, strengthening the role of the European Parliament in managing its affairs and putting an end to the “veto” powers that allow rich countries to prevent the ESM from serving poorer ones.

Democratising the ECBs

Extend the mandate toward the maintenance of low unemployment

In addition, we will reform the ECB in order to give greater voice to the needs of Europe’s citizens. In particular, we will extend the ECB’s mandate beyond price stability toward the maintenance of a low unemployment rate. The Federal Reserve of the United States already operates this “dual mandate.” It is time for the ECB to join them.

Completing the Banking Union

We will guarantee the integrity the Eurozone

We will complete the banking union in order to guarantee the integrity the Eurozone and protect it from future financial shocks. Our plan is twofold. First, we will support a European deposit insurance scheme that shares risk across the Eurozone. Second, we will extend the Bank Recovery and Resolution Directive to account for all ‘zombie’ banks currently in operation. We propose to move these banks into a Eurozone jurisdiction in order to restructure and recapitalise them.

European People’s Bank

A massive increase in fiscal capacity for EU member-states

If we wish to guarantee access to decent jobs, health, and education, we cannot rely on private finance alone. European Spring is proposing a European People’s Bank (EPB) that will cater to the needs of every neighbourhood in every municipality of the EU. Each member-state will govern the EPB in its jurisdiction, issuing national tax credits to create liquidity for each branch. The EPB will then use a Public Digital Payment Platform (PDPP) to take deposits and give out loans on the basis of those tax credits. Through this mechanism, the EPB can invest in a range of municipal services without increasing member-state deficits.

European Treasury

Expand public investment across Europe

We support the establishment of a European Treasury that will radically expand investment across Europe. The current set of policies — from the Stability and Growth Pact to the European Fiscal Compact — have created a straitjacket. European authorities lack access to fiscal resources, and Europe has suffered a crisis of under-investment as a result. The European Treasury would remove these constraints through a mix of EU taxes and bond issues. Such a Treasury could, for example, guide the Green New Deal through its bond issues, among other projects.