AltAusterity Digest #115 October 10-16, 2019

The anti-austerity protests in Ecuador have resulted in President Lenin Moreno withdrawing the International Monetary Fund (IMF) backed package known as Decree 883. The main target of the protests was the proposed increase in fuel costs as the government aimed to roll-back fuel subsidies. Indigenous-led protests blocked roads, shuttered businesses and halved Ecuador’s oil production. After failed repression, Moreno has included Indigenous leaders in UN mediated talks to find alternatives to the proposed austerity package. Other demands from Indigenous leaders included higher taxes on the wealthy and the firing of the interior and defense ministers over, whose handling of the protests left seven dead.

For Project Syndicate, Isabel Ortiz and Matthew Cummins discuss how the continued use of austerity policies in the present, despite their many failures, will making it harder for governments to achieve sustainable, inclusive economic growth in the future. The authors point out that with austerity becoming the “new normal,” public investments will remain well below levels that will be necessary to promote economic growth and to alleviate economic inequality and social discontent. According to research by Ortiz and Cummins, by 2021, total government expenditures as a share of GDP will be declining across 130 countries, of which nearly three-quarters are in the developing world. Furthermore, 69 countries are set to undergo cuts in expenditure as a share of GDP to well below pre-crisis levels. This is expected to exacerbate developmental humanitarian crises in countries such as Angola, Burundi, Congo, Djibouti, Egypt, Eritrea, Ethiopia, Iraq, Jamaica, Jordan, Nigeria and Yemen.

The Chicago Teachers Union is on strike. The Chicago Teachers Union (CTU) joins the workers of Service Employees International Union (SEIU) Local 73 in the fight to win contract provisions that reduce class sizes, hire more support staff, and end the use of private for-profit contract with corporations such as Sodexo and Aramark. The unions are also pushing for a wider bargaining agenda by trying to address issues related to affordable housing in the city. In 1995, state law opened up the education sector in Illinois for neoliberal restructuring, with Chicago being a central focus. The School Reform Amendatory Act abolished local controls over finance and school boards and centralized financial and political control in a CEO (replacing the superintendent) of the Chicago Public Schools (CPS). The law also restricted what education unions were able to negotiate. Earlier this year, legislation to repeal some of these measures was sidelined right before negotiations began. Despite this, the CTU and SEIU are using their mass support and organizational leverage in an attempt to bargain to wider working-class issues.

In the leadup to the Canadian federal election, Larry Savage examines the effectiveness of union-backed strategic voting campaigns. Strategic voting campaigns in Canada, designed to prevent vote splitting among non-Conservative parties, often leads to a higher share of seats going to Liberal candidates. Savage points to the mixed results in academic literature and points out that backing Liberal candidates operates on the assumption that the Liberals will be more pro-labour or less austerity driven than the Conservatives. While this is often a fair assumption, it also overestimates the differences between parties and causes union campaigns to overlook anti-union candidates and policy positions which are counter to the labour movement’s long-term interests. Savage concludes that whether motivated by fear, instrumentalism or both, union-sponsored strategic voting campaigns ultimately undermine union’s ability to push for their own political agenda.

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