Europe Sticks With Socialism

The EU's new policy blueprint includes a basic income and broad worker protections.

Bernie Sanders's ideological doppelganger?

Photographer: Chip Somodevilla/Getty Images

For all the ground that traditional socialist parties have lost, the European Union remains a profoundly socialist organization that believes in strong worker rights at the expense of corporations -- at least judging from its latest mission statement.

The European Commission has presented the final version of the European Pillar of Social Rights, a document in which Commission President Jean-Claude Juncker, aware that the EU has been stumbling, seeks to define anew what the whole project is about. Europe has traditionally distinguished itself from the U.S., as well as emerging Asian and Latin American economies, in its social bent: high taxes, strong social safety nets, tightly regulated labor markets. Although this approach has been denounced as a drag on economic development, the new EU document -- meant as a set of guidelines primarily for the euro area -- seeks to enshrine it.

The declaration's 20 basic principles include protections against abrupt dismissal, parental leave and flexible work regimes for both women and men who have kids, and even a paragraph that reads like an endorsement of a universal basic income -- a scheme that is being tested in Finland and will be explored in the Netherlands starting later this year:

Everyone lacking sufficient resources has the right to adequate minimum income benefits ensuring a life in dignity at all stages of life, and effective access to enabling goods and services. For those who can work, minimum income benefits should be combined with incentives to (re)integrate into the labour market.

This is much stronger than previous recommendations to provide adequate "social assistance" to the poor, apparently thanks to the support of France and Germany. In a separate document detailing the principles for staffers, the European Commission explains: "Minimum income aims at preventing destitution of people who are not eligible for social insurance benefits, or whose entitlement to such benefits has expired, thus combating poverty and social exclusion." 

Current EU regulations allow a four-month parental leave for both mothers and fathers, and a right to flexible working arrangements upon return. The new proposal calls for paid leave even if a worker doesn't need to care for a child or, say, an ailing parent. It also proclaims workers' right to switch between full-time and part-time employment, work from home as necessary and create other flexible arrangements. This is far more generous than in the U.S., where President Donald Trump's daughter Ivanka is pushing a plan to introduce 12 weeks' parental leave for mothers only.

The document augurs ill for "gig-economy" companies such as Uber, which want to treat their workers as independent contractors rather than employees. Under the "fair working conditions" principle, all workers must be treated equally and given access to social benefits and training, regardless of their contractual status. Although is pays lip service to the importance of "emerging business models," the declaration threatens firms that create precarious jobs with punitive taxation and penalties for terminating certain classes of employees. Such penalties already exist in some EU countries: In Austria, a firm can be punished for dismissing a worker older than 50 with at least 10 years on the job.

The product of broad consultations, the Social Pillar is solely a set of recommendations, not binding rules as labor unions and activists had wanted. But it does represent the zeitgeist in core euro area nations: Even moderate right governments in Germany and Spain support a level of worker protection and social security that, in the U.S., is the preserve of extreme progressives such as Senator Bernie Sanders.

Juncker's goal was to describe a broad consensus about what living in Europe means. Some stakeholder groups -- such as the influential corporate lobby BusinessEurope -- have balked at backing some of the specific recipes, such as the expansion of care leave. But even they agree with the general ideology, which prioritizes life quality over growth. With the U.K. actively seeking a competitive advantage as it leaves the EU and the current U.S. administration less socially inclined than its predecessor, this consensus will mean a greater divergence between the continent and the English-speaking world.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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