AltAusterity Digest #53 June 21-27, 2018

A general strike in Argentina has brought the country to a standstill as unions protest a $50bn IMF loan taken by the government. The General Confederation of Workers has blockaded roads and stopped trains, buses, and the subway in Buenos Aires to protest the expected austerity measures that will accompany the IMF package. Argentina’s relationship with the IMF is fraught with tension, as many blame the international lender for intentionally imposing tough economic conditions on the country when it defaulted on its debt 17 years ago.

A new report from the Roosevelt Institute has found that the Republican Tax Cut and Jobs Act are likely to make structural racism in the U.S. economy much worse. The report’s authors Darrick Hamilton and Michael Lindon concluded that the Republican tax cuts not only left certain racial disadvantages unaddressed, but actually strengthened racist outcomes and created new ones. While part of the growing racial inequality is due to the distribution of wealth along racial lines in the U.S., other factors, such as a greater reliance on fines and fees to make up for lost revenues, and a squeeze on the more equity-oriented hiring of the public sector will also disproportionately effect communities of colour.

After 8 years of crushing austerity, Greece has been cleared to borrow from markets again. While European Finance Commissioner Pierre Moscovici has claimed an end to the “Greek crisis,” it must still repay its first loan before 2033, after being bailed out by the Troika in 2010. The service its debt, Greece has committed to set aside 3.5% of its GDP until 2022, at which time the commitment will drop to 2.2% of GDP. Furthermore, Greece will not be entirely free to make its own spending decisions as it will be required to submit supervised budgets until 2059, when it is expected to pay off its loan to the European Stability Mechanism.

The U.S. Supreme Court has struck a major blow to public sector unions, ruling 5-4 that non-union workers will no longer be required to pay fees that go to servicing activities. The overturning of the 1977 law that required employees to pay “fair-share” fees has dramatic implications for public sector unions financial viability. The 1977 Abood v. Detroit Board of Education decision found that while non-union members cannot be required to pay fees for public sector union political activities, they are still required to pay fees pertaining to collective bargaining, grievances, and other union activities from which they directly or indirectly benefit. This overturning of the “fair-share” ruling follows Trump’s nomination of Justice Neil Gorsuch which has cemented the conservative majority within the Supreme Court.

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