Brussels, 30/08/2007 (Agence Europe) - A week before the meeting of the board of governors at the European Central Bank in Frankfurt, the European Confederation of Trade Unions (ETUC) called for the ECB to take into account the extent of the current turbulence on the European financial markets when they reach a decision on monetary policy and set interest rates. The ETUC insisted that the ECB did not increase rates and even reduce them if necessary. In a press release, Rainer Hoffmann ETUC Deputy Secretary General explained, “Three- month interest rates are now as high as 4.75%, exactly the same level which managed to throw the European economy into a five-year slump back in 2000. To maintain robust growth and job prospects, the ECB needs to consider a timely cut in interest rates." On top of this immediate action, the ETUC calls on all economic policy- makers to rethink and adapt the global and European model of economic and financial policy-making. 1) The present policy model is based on limiting the role of the public sector by pursuing zero public deficits and debts while outsourcing the management of the real economy to central bankers and financial markets; 2) by providing liquidity in an indiscriminate way to whatever (private) actor for whatever reason, this model of 'casino capitalism' has produced four to five major crises in 15 years (Savings and Loans in the US at the beginning of the 1990s, Long Term Capital Management (LTCM) hedge fund crisis and Asian financial crisis in 1998,
ICT bubble bursting with over-indebted firms in 2001-2003, sub-prime mortgage debts 2007, ETUC recalls in its press release). It concludes with a warning: “Casino capitalism” will continue to do so unless the role of the public sector as an economic actor and regulator is re-introduced.