ECB Protests

Anti-Austerians at the Gate

ECB Blockupy 2 Protests 18 March 2015 Frankfurt Source Reuters
Violent protests surrounded the official opening Wednesday of the European Central Bank's new twin-tower headquarters in Frankfurt.
  • Why it matters

    Why it matters

    Protests outside the European Central Bank headquarters in Frankfurt on Wednesday underlined the increasing role played by the institution in Europe.

  • Facts

    Facts

    • One policeman was injured, 350 were detained, in sometimes violent protests outside ECB headquarters in Frankfurt on Wednesday.
    • In a statement, ECB President Draghi said protesters were targeting the wrong institution for unpopular austerity policies.
    • An internal survey showed ECB workers were unhappy with the bank’s generous use of lower-paying temporary work contracts.
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Violent protests marred the official opening on Wednesday of the European Central Bank’s new skyscraper headquarters in Frankfurt, transforming the twin glass towers into Europe’s newest lightning rod for anti-austerity protest.

One police officer was injured, and at least 350 people were detained after empty blue-and-white police cars were set afire by protesters, some of whom had traveled hundreds of kilometers to the German financial capital for a well-organized anti-capitalist event billed as “Blockupy.”

Streets in the city’s normally staid financial district were cordoned off by German police after protesters set off a series of coordinated fires around the center, and groups of demonstrators clashed with police amid rising plumes of black smoke.

The official opening of the blue twin towers, one 43 stories high, the other 45, attracted a coalition of anti-capitalist, anti-austerity demonstrators from Dublin to Vienna, some in clown facepaint, and others in headscarves.

Under the “Blockupy” banner, protesters were given access earlier this week to a nearby Frankfurt theater, the Naxos Hall, to organize their operations. The theater, according to its website, is partly financed by the city of Frankfurt and state of Hessen.

ECB Blockupy 1 Protests 18 March 2015 Frankfurt Source Reuters
Police and a protester clash near the ECB headquarters in Frankfurt. The placard says: “Social class against social class.” Source: Reuters

 

Bankers interviewed on German television channel NTV Wednesday morning described how they were told by employers to come to work in informal clothing, without ties or business attire, to avoid being targeted by protesters.

During a ceremony within the bank’s headquarters, which were guarded by 8,000 police, the ECB president, Mario Draghi, said protesters were misdirecting their anger at the central bank, which is currently in the midst of a €1.1 trillion quantitative easing plan of debt purchases designed to stimulate the economy.

Mr. Draghi said that “European unity is being strained” by the ongoing economic crisis and cautioned that the voice of the people must be heard.

“The ECB has become a focal point for those frustrated with this situation,” Mr. Draghi said. “This may not be a fair charge – our action has been aimed precisely at cushioning the shocks suffered by the economy.”

The flare-up comes at a volatile moment in Europe, with the ECB and Germany at odds over the future fiscal direction for a currency zone, which began with 11 countries but has grown to 19 including Latvia, which borders on Russia.

Germany, the largest economy in Europe and the euro zone, is a leading advocate of austerity in the zone’s battle with Greece, which may become the first country to leave the zone for failing to conform to its financial rules.


Video: Films posted on YouTube on Wednesday of the Frankfurt protests at ECB headquarters.
The unidentified person who made and posted the films simply called himself: Important TV.

Relations between Germany and Greece hit a new low this week after a video surfaced of the Greek finance minister, Yanis Varoufakis, giving the middle-finger to Germany during a speech in 2013 when he was a professor.

The official opening of the blue twin towers, one 43 stories high, the other 45, attracted a coalition of anti-capitalist, anti-austerity demonstrators from Dublin to Vienna, some in clown facepaint, and others in headscarves.

Mr. Varoufakis’ spokesman at first said the video was doctored, but after its authenticity was verified, said he had referred at the time only to the situation in Greece in 2010.

Greek Prime Minister Alexander Tsipras, whose left-wing Syriza party won elections in January on its promise to end crippling austerity, may meet in Brussels Thursday with German Chancellor Angela Merkel, according to reports out of Brussels.

The two leaders are set to meet in Berlin on Monday.

The protests in Frankfurt, which began late Tuesday night, targeted the ECB, which with the International Monetary Fund and European Commission is charged with monitoring a €240-billion international bailout to keep Greece afloat amid the crisis.

Ironically, the ECB, led by Mr. Draghi, an Italian economist, broke openly with Germany earlier this year over the bank’s decision to launch a €1.1 trillion “quantitative easing” program of debt purchases designed to revive the struggling economies of southern Europe.

The massive, unprecedented stimulus program – the opposite of fiscal austerity advocated by German – is exactly what many protesters in Frankfurt were calling for in placards.

ECB Blockupy 3 Protests 18 March 2015 Frankfurt Source Reuters
Protesters converged for the ECB protest from all corners of Europe. Source: Reuters

 

Inside the gleaming headquarters, which opened last year at a cost of €1.3 billion, some employees of the central bank are also angry over labor policies that have relegated about two-thirds of workers to short-term contracts.

The ECB is exempt from German labor laws, and use of temporary contracts, which typically pay less and offer fewer benefits than full-time positions, has become a point of contention among its predominantly German temporary workers.

The massive, unprecedented stimulus program -- the opposite of fiscal austerity -- is exactly what many protesters in Frankfurt were advocating in their placards.

Within its new corridors and offices, there is growing dissent over the policies. At first glance, it may be difficult to see what the bank’s staff are complaining about.

A job at the bank, one of the world’s most powerful financial institutions, comes with an array of benefits, not least of which is a relatively low European rate of income tax amounting to just 13.5 percent for an employee earning €60,000 per year.

Training courses and language lessons are provided and there’s a good health-care plan. Yet many staff are unhappy about working conditions, according to their union, the IPSO International and European Public Services Organisation.

The union recently unfurled a banner in the building’s lobby calling for more democracy.

“I feel completely defenseless against my bosses. Everyone knows: if you complain, they’ll kick you out,” complained one worker, who declined to be named.

ECB Blockupy 5 Protests 18 March 2015 Frankfurt Source DPA
In Frankfurt, 8,000 police guarded ECB headquarters and responded to protesters. Source: DPA

 

The bank, through a spokesman, declined to respond to the allegations of unfair labor practices.

The union said fewer than one in three of the bank’s 3,800 employees have a permanent job contract.

“Many are given successive temporary contracts. That creates uncertainty and puts staff under pressure,” Carlos Bowles, the head of the union, told Handelsblatt.

Mr. Bowles estimated that at the end of 2014, only 1,220 ECB employees had permanent contracts. The bank said it currently has 1,300 workers on permanent contract and attributes the large number of temporary staff in part to recruitment last year of 1,000 workers in its new role as watchdog for Europe’s banking industry.

Within its new corridors and offices, there is growing dissent over the ECB's hiring policies. At first glance, it may be difficult to see what the bank's staff are complaining about.

Most of those new staff don’t have permanent deals. The bank also said that at the end of 2014, the bank had 372 staff members on short-term contracts or on loan from national central banks in the euro zone.

On top of that are about 280 people recruited temporarily from local employment agencies, as well as consultants and trainees.

It’s a different story at the German central bank, the Bundesbank, where only 146 of 10,038 staff are on temporary contracts.

At the ECB, some staff complain about demands for overtime and being permanently on call. Some workers have said the bank is using temporary workers for sensitive positions in its IT department, perhaps jeopardizing security.


Video: Films posted on YouTube on Wednesday of the Frankfurt protests at ECB headquarters.
The unidentified person who made and posted the films simply called himself: Important TV.

In a survey of ECB staff conducted by the union last September, a third of workers said they were suffering from burnout or in danger of burning out. Another third said they were exhausted.

Mr. Bowles, a 42-year-old Frenchman who has headed the union for five years, said staff felt pressured by management and peers to work longer hours, and only those who bowed to the pressure advanced.

“Those who want to have a career have to give up their private and family lives,” he said. The ECB declined to comment on the allegations from the union and some of the bank’s current employees, who spoke only anonymously.

Because the bank is a European institution, workers in Frankfurt cannot invoke Germany’s more favorable labor laws in disputes.

“Basically the ECB controls itself,” said Norbert Pflüger, a German labor lawyer who represents ECB staff members in several ongoing court cases — which isn’t that easy.

ECB workers who want to pursue legal action must first go through an internal process. Only once that is over can they file suit.

“That takes a very long time,” Mr. Pflüger said.

 

Kevin O’Brien is the editor in chief of Handelsblatt Global Edition. Jan Mallien is a Handelsblatt editor in Frankfurt. Franziska Scheven and Christopher Cermak, two editors at Handelsblatt Global Edition in Berlin, contributed to this article. To reach the authors: obrien@handelsblatt.com, mallien@handelsblatt.com, scheven@handelsblatt.com and cermak@handelsblatt.com

 

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