The first major test faced by a 'big' EU country in 2009 comes as France is brought to a standstill by a general strike against President Nicolas Sarkozy's proposed economic reforms.
Eight of the country's leading trade unions will participate, spurred on by high levels of support among French voters: almost 70% are sympathetic towards the protests, according to a CSA poll.
Ronald Janssen, an economist at the European Trade Union Confederation (ETUC), told EurActiv that social unrest across Europe will "intensify" and is likely to mushroom into an "explosion" as the economic crisis escalates, because "not only will job losses continue, increasing unemployment, but a lot of social advantages will be attacked by employers saying 'if you want to keep your job, you will have to accept a cut in wages or benefits'".
As Iceland goes, so goes Europe?
Icelandic Prime Minister Geir Haarde this week became the first European leader to lose his job as a direct result of the economic crisis. The collapse of Haarde's government was precipitated by weeks of angry protests in Reykjavik, including the burning of effigies of the prime minister outside parliament. Before being ousted, Haarde had expressed fears that the economic crisis would lead to a political one.
In fact, Iceland may well be the weathervane that points the way towards a troubled 2009. Marko Papic, a geopolitical analyst at Stratfor, argued that "in terms of perception, Iceland is like a canary in the mineshaft. It tells us how bad things can get in the rest of Europe".
Indeed, following last year's tumultuous riots in Greece (EurActiv 11/12/08), early 2009 has continued in the same vein, with anti-government riots having taken place in Bulgaria, Latvia and Lithuania so far as social unrest grows. Dominique Strauss-Kahn, president of the International Monetary Fund, warned in late 2008 that "social unrest may happen in many countries, including advanced economies," as a result of the crisis.
Moreover, Papic points out that "there are a number of elections coming up in Europe [in 2009]: in Slovakia, Lithuania, Bulgaria, the Ukraine, and of course - Germany. These countries will have to run their campaigns amidst economic collapse, therefore whatever social unrest there is will be highlighted and increased".
Social Europe: Coming apart at the seams?
The worst-case scenario, argues ETUC's Janssen, could see an "explosion of public unrest" and a de facto collapse of the European social model as we know it.
"There's a big scandal of which awareness is brewing: governments are now trying to save banks through injecting capital and save companies by giving credit guarantees, and this will translate into higher public deficits," he said.
This in turn, he argued, will lead to pressure from the European Commission, the OECD and economists generally. "This is not sustainable for public finances, so you have to cut social security, which will lead to an attack on social Europe," the ETUC economist said.
People will come to realise, claims Janssen, that in fact they are paying the bill for the excesses of banks and corporate CEO bonus systems.
As a result, the combined effects of mass unemployment, collapsing social security systems and heightening social unrest could herald a "major collapse": "It might be the case, I fear, that the European social model is unravelling," the economist concluded.
