Margot Wallström sees Europe weathering the recession thanks to social welfare systems and Eastern Europe’s growing economy.
Question: How has Europe’s social welfare system changed the recession’s impact?
Margot Wallström: It’s called a social market economy in Europe. It doesn’t mean that you are marginalized or out of everything if you lose your job. You are still part of society. You still have a social security. You still have a place in society. And this is very important, in order [for you] to be able to come back soon to a situation where you can find a new job, where you can help your family. This has always been part of our policy.
Recently, we have discussed a concept called Flex Security, meaning that there has to be flexibility on the labor market. You have to be able to adapt to where the new jobs will come [from], so you might have to change jobs maybe more often. But you should also know that you have the support of society and from your government: that you can get training so you can find a new job, or you can be equipped to take on a new job, or you get to move so that you can actually find a job somewhere else. That will help the economy also to work more smoothly. And I think those countries where they have applied such systems have been very successful also from an economical point of view. So both the social and economic elements have to complement each other.
Question: What is the European view of America’s lack of social welfare?
Margot Wallström: We’ve had an opportunity to compare them when we’ve been looking at the car manufacturers, because the crisis has hit both American car producers as well as European car producers. Somebody who works in the car factory in the United States, his or her conditions if being laid off, or if somebody in Europe loses their job. There’s a whole lot of difference. And I think, again, it’s a matter of the attitude towards taxes, and the society, and government. We diverge a lot when it comes to that.
Question: Describe Eastern Europe’s role in the EU economy.
Margot Wallström: Well they have had the highest growth figures over the recent years, and a lot of investments have taken place in the former Eastern European countries. We’ve had this historical achievement, we have now 27 member states. The ones were formerly called Eastern European countries, we [had] divided Europe into an East and the West, and today this is no longer true. We are all around the same table to take discussion, to make decisions on important issues. It’s an amazing achievement by the European Union. So I think very soon we will no longer use the concept of an Eastern and the Western Europe, but one Europe that is finally whole and free. And they have been very, very important in the European economy, because they’ve had enormous growth and potential. They also have big problems now, when we are in the crisis situation, but they have the solidarity that all new member states have to come to look for.
Recorded on: July 10, 2009