The European sovereign debt crisis, which was caused by member states' public debt but increased because of the actions taken to rescue the banks after the 2008 crisis, demonstrates at least three things. First, that currency does not exist without a state. Second, that capitalism cannot be managed by the market alone. And third, that the austerity measures will not bring Europe out of the crisis but will in fact continue to make it worse – until the euro crashes.
However, the most important point to emerge from the crisis is that Europe's political reinvention will depend exclusively on the social struggle against neoliberal politics. Neoliberalism, the absurd idea of economic government based solely on the market and its ability to self-regulate, is at the root of the great illusion of a leaderless Europe supposedly unified by a euro that has controlled the internal economic and social differences according to the logic of the financial markets.
And yet, neoliberalism is still the only language used by European politicians to confront the crisis and to face the social conflicts that will break out over the next few months. There exists no European government; only management of austerity measures and of repression.
The European banking stress tests were of little use – they only breathed a bit of life back into the German and French banks that had been exposed to the sovereign debt of the outlying countries of the EU. The recent economic successes of Germany – the increase in exports, in particular to areas outside the eurozone – cannot reverse the direction of the euro's crisis.
In fact, the cracks between the economically strong countries and those that are industrially weak, conditioned by the politics of the European Central Bank, can only get worse. In all likelihood, the final outcome of this crisis will be the exit of Germany from the euro – it's just a matter of time. Greece or Spain's departure from the eurozone would not heal the cracks inside the central block of the EU or the divide between Germany – which is focusing more on Asian and South American markets – and France, which has been losing economic power and political credibility for some time.
The US crisis and the slowing down of growth in countries such as China, India and Brazil will give the coup de grâce to the euro and to the political desire to preserve the European project. The drying up of methods to stimulate the economy used by the Obama government and the Federal Reserve, the slowing down of growth in China to avoid bursting the real-estate bubble, and the increase of interest rates in India in the face of rising inflation will prevent any successful attempts to relaunch the European economy by taking advantage of the weak euro and the strength of the German economy.
In this context, the austerity measures imposed on all eurozone countries will be impossible to carry out. There will be a stampede away from the plan of European stability – and very soon, as Hungary has shown us – with repercussions on economic and social policy within the member states. We are watching the de-Europeanisation of Europe.
If this is the result of making capitalism more and more focused on finance over the last few decades, then it is from its crisis that we must find a way out of neoliberalism, which is its main cause. The solution is not, at least for the moment, in writing a new European constitution. It is in starting up constitutional processes from the ground up, movements to fight against the austerity measures that are still, in the most part, to be implemented.
We must resist the reduction of salaries, oppose cuts in public services, redistribute the wealth that financial capitalism has appropriated, and convert economic growth into sustainable development. The Europe characterised by its people and its differences will only be saved if neoliberal Europe is destroyed.
Christian Marazzi, professor and director of socio-economic research at the Scuola Universitaria della Svizzera Italiana and is the author of the Violence of Financial Capitalism.