Portugal’s debilitating passivity

This blog post from Portugal was first published yesterday on Fundweb. Although I do not draw out the point in the piece it seems to me that the European Union, as an elitist technocratic project, has played a considerable role in inculcating the fatalist mood I describe.

 It was not originally planned that way but I was hoping that a visit to Portugal would give me some insight into the country’s economic plight. In the event it did but not quite in the way that I expected.

For the large football-loving section of the population there was a sense of national disaster but not over economics or politics. The Portuguese national team suffered a shock home defeat to Albania in its first Euro 2016 qualifying match. I cannot speak Portuguese, nor am I an expert in body language, but Paulo Bento, the team manager, looked embattled in the numerous television interviews he gave after the game. A few days later he announced his resignation.

 Beyond that I am more wary than most writers about drawing sweeping conclusions about a country on the basis of a short visit. I certainly do not believe that the standard journalistic technique of interviewing a local taxi driver is a reliable gauge of public opinion.

It would be easy to draw the misleading conclusion that the relatively large number of unoccupied shops and other buildings (although no more than in many British high streets) are a symptom of economic retrenchment. There probably is some truth in this but it is also the case that from as far back as the 1970s many shops and business have migrated to the outskirts of Portuguese cities. Although tourists tend to stick to seaside resorts and historic city centres many Portuguese prefer to spend spare time in American-style malls.

Young volunteers are a ubiquitous sight in many towns and on the transport system. Typically they travel in groups of three or more and they are set tasks such as aiding commuters or helping to keep beaches clean. No doubt this phenomenon is a reflection of the high levels of youth (16-24) unemployment. The rate of about 35 per cent is grim but down from a peak of over 40 per cent in February 2013. Presumably the young volunteers, who are evidently paid a small stipend, are not classified officially as unemployed.

High migration, particularly by the well educated, is another effect of unemployment. Some go to Portugal’s former colonies, such as Brazil and Angola, while others migrate to European destinations such as Germany. German classes at the local Goethe Institutes are reportedly full of young graduates learning the language in preparation for a working life in central Europe.

Talk to older adults and a different although parallel picture emerges. Incomes for public sector workers have been slashed while many aged 50 or over have come under pressure to retire early with a reduced pension entitlement. Whole sectors, such as construction, appear to be largely idle.

There is also much talk of privatisation of such entities as the airport operator and the insurance arm of the state-owned bank. Such initiatives appear to be a result of EU pressure to raise revenue rather than by what is sometimes derided as an ideological commitment neoliberalism.

However, the most striking feature of Portugal’s plight is the widespread fatalism of the population rather than the economic challenges themselves. People talk about “the crisis” as if it is a natural disaster. There seems to be little sense that the eurozone’s recent woes are at least partly the product of the monetary bloc’s structural flaws as well as bad economic policy.

Resigned acceptance is a poor starting point for working out how to generate a new round of prosperity.