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Towards a New Economic Policy Framework, Building on Labour Internationalism

11 December 2020

Meeting in London in November 2018, the TUAC Working Group on Economic Policy (WGEP) discussed the changing nature of globalisation – “a runaway train breaking the post-war social contract”, pushing people towards an inward-looking agenda, populism and general anti-political sentiment. At the time, the major risk foreseen by attending participants was the bursting of another financial bubble, which would had coincided with another wave of austerity policy measures across OECD countries. The TUAC WGEP agreed to engage in further discussions on economic alternatives to press the case for more in-depth restructuring of the global economic system, avoiding failures and shortcomings that characterised the post-2008 recovery.

What followed, in 2019, was a first discussion paper, aimed at providing the basis for a new “Trade Union Economic Narrative”, one based on the centrality of labour and aggregate demand in fostering sustainable macroeconomic growth.

In early 2020, another unexpected economic shock hit the world, triggered by the diffusion of the COVID-19 pandemic. The prompt intervention of major central banks and governments avoided a second financial meltdown in little over a decade, but was insufficient to prevent a deep recession of the real economy.

In March 2020, the meeting of the TUAC WGEP was cancelled due to the mounting health risks posed by the virus and confinement measures implemented by national governments. Still, the TUAC Secretariat started working on a “Call for a New Economic Policy built on Labour Internationalism”. Based on the logical arguments of the Trade Union Economic Narrative, the aim of the Call was to present policymakers a clear, substantial list of economic asks for a fair and labour-centred global macroeconomic framework. The Call was first presented and discussed at the virtual WGEP in October 2020.

The final document presented hereby combines the Narrative and Call in a coherent paper (“Towards a New Economic Policy Framework, Building on Labour Internationalism”) that sets the trade unions’ vision of the world economy. It highlights the actions that governments and international organisations must undertake in order to re-establish an inclusive global system, abandoning the inadequate policy tools of the past to face the challenges of the future. In doing so, it reiterates the importance of collective bargaining and trade unions, as well as their readiness to support and assist workers, institutions and governments in the enormous task of “building back better” the world we live in.