Why Eurozone countries’ debt to the ECB must be cancelled

7 December 2021 by Eric Toussaint , Sonia Mitralias , CADTM Europe , Paul Murphy , Miguel Urbán Crespo , Andrej Hunko , Cristina Quintavalla , Manon Aubry , Leïla Chaibi

Since the beginning of the coronavirus pandemic public debt in the eurozone has increased by an average of 20%.

The reason for such an increase is straightforward: instead of finding the necessary new resources by taxing the wealthiest 1% and the big corporations as the CADTM and others had been demanding, governments have preferred borrowing, thus increasing the weight of illegitimate debt.

The past 40 years of neoliberalism and its repeated crises has widened the gap between the working classes and wealthy asset Asset Something belonging to an individual or a business that has value or the power to earn money (FT). The opposite of assets are liabilities, that is the part of the balance sheet reflecting a company’s resources (the capital contributed by the partners, provisions for contingencies and charges, as well as the outstanding debts). -owners and increased the burden of public debt in the continual process of capital accumulation. The coronavirus pandemic does not affect all social classes equally. Big corporations such as the GAFAM companies (Google, Amazon, Facebook, Apple, Microsoft) have garnered huge profits thanks to the lockdowns; Big Pharma companies such as Pfizer, Moderna, AstraZeneca, Johnson & Johnson, Curevax, Merck, have had windfalls from the pandemic by selling vaccines and treatments at exorbitant prices (see Coronavirus: Global Collective Commons vs Big Pharma), major banks and investment funds Investment fund
Investment funds
Private equity investment funds (sometimes called ’mutual funds’ seek to invest in companies according to certain criteria; of which they most often are specialized: capital-risk, capital development funds, leveraged buy-out (LBO), which reflect the different levels of the company’s maturity.
have also benefited from government grants as have big energy sector corporations.

Refusing to implement a Covid tax on the wealthiest and on big corporations has not only increased inequalities but also resulted in a steep increase of the debt, as tellingly illustrated in Europe. The total public debt in the Eurozone amounts to €12 trillion. From early 2020 to July 2021, Euro zone debt rose, on average, from 86% of the GDP GDP
Gross Domestic Product
Gross Domestic Product is an aggregate measure of total production within a given territory equal to the sum of the gross values added. The measure is notoriously incomplete; for example it does not take into account any activity that does not enter into a commercial exchange. The GDP takes into account both the production of goods and the production of services. Economic growth is defined as the variation of the GDP from one period to another.
to 100%. A number of countries have a much higher debt/GDP ratio. The public debt of Belgium and France is close to 120% of their GDP; for Spain 125%; for Portugal 140%; for Italy 160%. As to the public debt of Greece it reaches 210% while at the worst time of the 2015 debt crisis it amounted to 180% and the Troika Troika Troika: IMF, European Commission and European Central Bank, which together impose austerity measures through the conditions tied to loans to countries in difficulty.

pretended it would go down.

European Central Bank
The European Central Bank is a European institution based in Frankfurt, founded in 1998, to which the countries of the Eurozone have transferred their monetary powers. Its official role is to ensure price stability by combating inflation within that Zone. Its three decision-making organs (the Executive Board, the Governing Council and the General Council) are composed of governors of the central banks of the member states and/or recognized specialists. According to its statutes, it is politically ‘independent’ but it is directly influenced by the world of finance.
holds a significant portion of the Eurozone public debt. At the moment of writing these lines, it has over €3.9 trillion in eurozone sovereign securities, i.e. over 30% of the above mentioned €12 trillion. Figures for each country are available on the ECB website. The ECB buys sovereign securities of eurozone countries through two programmes: 1. the Pandemic emergency purchase programme (PEPP) and 2. the Public sector purchase programme (PSPP).

Some examples: The ECB holds about €140 billion of the Belgian debt, €730 billion of the French debt, €360 billion of the Spanish debt and €675 billion of the Italian debt.

The ECB purchased the securities from private banks as it does not grant loans to Eurozone member States. On the other hand, States repay these bonds to the ECB.

Since 2020 many economists and social movements have demanded the cancellation of debts held by the ECB, see the call “Cancel the public debt held by the ECB and ‘take back control’ of our destiny” signed by over 150 economists published in various media in February 2021. The ECB can cancel debts held on eurozone countries. It is a mere bookkeeping operation that does not raise any difficulty, and a central bank cannot go bankrupt.

The ECB board and European governments rejected this proposal because they favour an increase in public debt. It will allow them and their institutions to quickly roll out the good old new discourse. After claiming that States could increase their debts, they will say that they must now cut expenses, reduce public investments, introduce new structural measures in old-age pensions and social security systems, restore the rules on fiscal deficit, which have been temporarily suspended but in no case cancelled. In other words, they are impatient to return to the austerity policies inscribed in the European Treaties.

This extended period of pandemic has been used to flaunt rights and liberties. The cancellation of the public debt held by the ECB must be considered an emergency measure to secure public health. If so, it would reduce the Euro zone countries’ debt by about 30%. Debt repayment would be less crushing, and as a consequence public authorities would find fresh resources to increase expenses in such fields as health care Care Le concept de « care work » (travail de soin) fait référence à un ensemble de pratiques matérielles et psychologiques destinées à apporter une réponse concrète aux besoins des autres et d’une communauté (dont des écosystèmes). On préfère le concept de care à celui de travail « domestique » ou de « reproduction » car il intègre les dimensions émotionnelles et psychologiques (charge mentale, affection, soutien), et il ne se limite pas aux aspects « privés » et gratuit en englobant également les activités rémunérées nécessaires à la reproduction de la vie humaine. , social solidarity, struggle against the ecological crisis and climate change. It is high time that the collective interest Interest An amount paid in remuneration of an investment or received by a lender. Interest is calculated on the amount of the capital invested or borrowed, the duration of the operation and the rate that has been set. of the peoples of Europe take the upper hand on the tyranny of financial markets.

What’s more, the precedent of cancelling of ECB held debts would deprive the ECB of a coercive instrument that is uses to enforce its neoliberal agenda. Indeed, as long as the ECB is the Eurozone countries’ main creditor, it threatens those who are reticent to the neo-liberal doxa, to stop buying their debts or to refuse them as collateral Collateral Transferable assets or a guarantee serving as security against the repayment of a loan, should the borrower default. , which would increase the cost of their new loans. That is exactly what happened with Greece in 2015, and what it threatened Italy with in the spring of 2019.

Taking this tool away would be a victory.

But we must not forget that besides the cancellation of debts held by the ECB there are other options. A popular government can unilaterally suspend debt repayment to the ECB, which will force it to negotiate and make concessions. This would prompt other governments to follow suit. To this end, citizens’ support of a popular movement demanding an audit of all debts as a key instrument to establish their illegitimate, illegal, odious or/and unsustainable parts that ought to be cancelled, is of the utmost importance. This is still an essential strategic move today.

The fears that in case of cancellation, the financial markets and the various private creditors would demand higher interest rates Interest rates When A lends money to B, B repays the amount lent by A (the capital) as well as a supplementary sum known as interest, so that A has an interest in agreeing to this financial operation. The interest is determined by the interest rate, which may be high or low. To take a very simple example: if A borrows 100 million dollars for 10 years at a fixed interest rate of 5%, the first year he will repay a tenth of the capital initially borrowed (10 million dollars) plus 5% of the capital owed, i.e. 5 million dollars, that is a total of 15 million dollars. In the second year, he will again repay 10% of the capital borrowed, but the 5% now only applies to the remaining 90 million dollars still due, i.e. 4.5 million dollars, or a total of 14.5 million dollars. And so on, until the tenth year when he will repay the last 10 million dollars, plus 5% of that remaining 10 million dollars, i.e. 0.5 million dollars, giving a total of 10.5 million dollars. Over 10 years, the total amount repaid will come to 127.5 million dollars. The repayment of the capital is not usually made in equal instalments. In the initial years, the repayment concerns mainly the interest, and the proportion of capital repaid increases over the years. In this case, if repayments are stopped, the capital still due is higher…

The nominal interest rate is the rate at which the loan is contracted. The real interest rate is the nominal rate reduced by the rate of inflation.
to further finance governments, is unfounded. All governments that benefited from a substantial reduction of its debt had access to less costly loans than before the cancellation. Indeed, creditors consider that a country with a low level of indebtedness is more creditworthy.

Obviously debt cancellation is not the ultimate solution, other measures are necessary: higher taxes on the wealthiest 1% and on big corporations as we have demanded from the start of the pandemic; fighting tax evasion with high fines on evaders, the suspension of the banking licence for banks that act as intermediaries for abusive tax avoidance, the elimination of European tax havens, the public ownership of key sectors of the economy,… Higher taxes on the wealthy must be combined with a reduction of taxes on the majority of people, such as a lowering of VAT on basic goods and services, such as energy. On the other hand, taxes on luxury goods must be increased.

Confronting the current social crisis inevitably means fighting inequalities. We have to fight multiple, interconnected and increasing inequalities and act on their sources such as unfair tax policies, austerity measures and the power of big corporations. In short, we have to focus on redistribution of wealth and resources as the main point of an eco-socialist programme. Because our lives are worth more than their profits, let us tear away the straitjacket of the debt.

Translated by Mike Krolikowski and Christine Pagnoulle


  • Éric Toussaint, spokesperson for CADTM International
  • Miguel Urban, MEP, member of Anticapitalistas
  • Cristina Quintavalla (ATTAC-CADTM Italy)
  • Paul Murphy, member of the Irish parliament People Before Profit Profit The positive gain yielded from a company’s activity. Net profit is profit after tax. Distributable profit is the part of the net profit which can be distributed to the shareholders.
  • Andrej Hunko (Die Linke), member of the Bundestag and the Council of Europe
  • Jean-François Tamellini, Secretary General of the trade union FGTB Wallonia
  • Catherine Samary, economist, member of the Scientific Council of ATTAC France
  • Anne-Marie Andrusyszyn, Director of CEPAG
  • Olivier Bonfond, economist CEPAG
  • Christine Mahy, General and Political Secretary of the Walloon Anti-Poverty Network (RWLP)
  • Fred Mawet, ATTAC Brussels activist
  • Maria Bolari, former Member of the Greek Parliament
  • Maja Breznik, sociologist, Slovenia
  • Christine Pagnoulle, honorary lecturer at the University of Liège, secretary of ATTAC Liège
  • Eric Coquerel (France Insoumise) deputy at the National Assembly
  • Brigitte Ponet, militant of CADTM Belgium
  • Sonia Mitralias, feminist activist, former member of the Commission for the Truth about the Greek debt
  • Peter Wahl, economist, co-founder of Attac Germany
  • Stathis Kouvelakis, philosopher, Revue Contretemps
  • Daniel Richard, regional secretary of the trade union FGTB Verviers &amp
  • German-speaking Community
  • Rastko Mocnik, sociologist, Slovenia
  • Jean-François Ramquet, regional secretary of the trade union FGTB Liège-Huy-Waremme
  • Herman Michiel, editor of Ander Europa
  • Manon Aubry, MEP, France Insoumise
  • Carlos Sánchez Mato, Professor of Applied Economics. Complutense University of Madrid. Responsible for the development of the Izquierda Unida programme
  • Manuel Garí Ramos, economist and activist of Anticapitalistas
  • Mikel Noval and Janire Landaluze (ELA Emergency Liquidity Assistance
    Emergency funds loaned to the private banks by the Eurozone central banks.
    trade union, Basque Country)
  • Fátima Martín, journalist, promoter of the digital media
  • Jaime Pastor, Viento sur magazine
  • Paul Émile Dupret, lawyer, A contre-courant
  • Christine Poupin, NPA
  • Corinne Gobin, political scientist FNRS/ Université Libre Bruxelles
  • Tijana Okić, Crvena association, Sarajevo
  • Alexis Cukier, philosopher, Attac, CGT, Let’s join
  • Angela Klein review SOZ, Germany
  • Felipe Van Keirsbilck, secretary general of the Centrale Nationale des Employés (Belgium)
  • Leïla Chaibi, MEP, France Insoumise
  • Riccardo Petrella, professor emeritus, UCL, Agora des Habitants de la Terre
  • Jan Malewski, editor of the magazine Inprecor
  • Pierre Khalfa, Copernic Foundation
  • Michael Lowy, emeritus researcher, CNRS
  • Ludo De Brabander, spokesman for Vrede vzw (Belgium)
  • Pierre Delandre, Sociologist of money, executive, associate researcher at Etopia
  • Nicolas Dufrêne, director of the Rousseau Institute
  • Gaël Giraud, director of research at the CNRS and honorary president of the Rousseau Institute
  • Noël Lechat, General Secretary of the CGT Federation of Research Companies
  • Danièle Obono, (France Insoumise) member of the National Assembly
  • Patrick Saurin, trade unionist in the banking sector, Sud Solidaires
  • Penelope Duggan, editor of the magazine International Viewpoint (France)
  • Martine Orange, journalist Mediapart
  • Anne-Sophie Bouvy, researcher in public law at the University C. Louvain
  • Stavros Tombazos, Professor of Political Economy, University of Cyprus
  • Pierre Galand, honorary senator, association activist (Belgium)
  • Raoul Hedebouw, president of the PTB, federal deputy (Belgium)
  • Ida Dequeecker, feminist activist (Belgium)
  • Willem Bos, editor of Grenzeloos
  • Costas Lapavitsas, Professor of Economics at SOAS and former member of the Greek Parliament
  • Yorgos Mitralias, journalist, former member of the Commission for the Truth about the Greek debt
  • Alda Sousa, former Member of the European Parliament, Bloco de Esquerda, Portugal
  • Ludivine Bantigny, historian (France)
  • Roseline Vachetta, former Member of the European Parliament, NPA activist
  • Mauro Gasparini, Gauche anticapitaliste (Belgium)
  • Thomas Weyts, SAP (Belgium)
  • Véronique Danet, CGT bank trade unionist (France)
  • Raquel Freire, writer and film-maker (Portugal)
  • Rui Viana Pereira, CADTM activist in Portugal
  • Eulàlia Reguant, member of the Catalan parliament
  • Ugo Palheta, sociologist, University of Lille, co-director of Contretemps
  • Franck Gaudichaud, academic, co-president of France Amérique Latine
  • Pierre Rousset, co-publisher of the website Europe solidaires sans frontières (ESSF)
  • Teresa Rodríguez, former MEP, member of the Andalusian Parliament and spokesperson for Adelante Andalucía;
  • José María Gonzalez Santos, Mayor of Cádiz;
  • María Dantas, (Esquerra Republicana de Catalunya, ERC) Member of the Spanish Parliament;
  • Alice Picard, spokesperson Attac France;
  • Raphaël Pradeau, spokesperson Attac France; Ana Podvrsic, researcher, Austria;
  • Alex Callinicos, Emeritus Professor of European Studies, King’s College London;
  • Raymonde Poncet Monge, senator, Europe Écologie Les Verts;
  • Jérôme Gleizes, economist, vice-president of the Paris Ecologist Group, Europe Écologie Les Verts;
  • Bríd Smith, member of the Irish parliament People Before Profit;
  • Richard Boyd Barrett, member of the Irish parliament People Before Profit;
  • Gino Kenny, member of the Irish parliament People Before Profit;
  • Raquel Varela, history researcher at UNL (Lisbon), president of the International Association Strikes and Social Conflicts;
  • Philippe Poutou, NPA, municipal councillor of Bordeaux, presidential candidate in France;
  • Olivier Besancenot, NPA, former presidential candidate in France;
  • Justin Turpel, former deputy dei Lénk - La Gauche, Luxembourg ;
  • Giorgos Galanis, Goldsmiths, University of London;
  • Stelios Foteinopoulos, International public policy expert and justice campaigner & former European Parliament Policy advisor on Economic and Financial Affairs and justice campaigner;
  • Tassos Anastassiadis, member of General Council of POESY (Federation of greek journalists);
  • CADTM Italy;
  • ATTAC Italy
  • José Gusmão, member of the European Parliament, The Left Bloc (Portugal)
  • Franziska Hildebrand, International solidarity: stop austerity! activist, Die Linke.SDS Hamburg, Germany;
  • Elias Gläsner, International solidarity: stop austerity! activist, Die Linke.SDS Hamburg, Germany;
  • João Camargo, climate researcher, activist in Climáximo, Portugal
  • Jorge Costa, member of Parlement, BE, Portugal
  • Luis Fazenda, member of Parlement, BE, Portugal
  • Pedro Filipe Soares, member and leader of Parlement, BE, Portugal
  • David Murgia, Actor, director, Belgium
  • Hélène Le Cacheux, co-coordinatrice du Parti de Gauche, France
  • Jean-Christophe Sellin, co-coordinateur du Parti de Gauche, France
  • Alexis Corbière, député France Insoumise à l’Assemblée Nationale, France
  • Pierre Pénet, sociologist, ENS Paris Saclay/IDHES
  • Franco Turigliatto, ex senatore Sinistra Anticapitalista;
  • Checchino Antonini, giornalista.
  • Die Linke.SDS Federal Congress

Eric Toussaint

is a historian and political scientist who completed his Ph.D. at the universities of Paris VIII and Liège, is the spokesperson of the CADTM International, and sits on the Scientific Council of ATTAC France.
He is the author of Greece 2015: there was an alternative. London: Resistance Books / IIRE / CADTM, 2020 , Debt System (Haymarket books, Chicago, 2019), Bankocracy (2015); The Life and Crimes of an Exemplary Man (2014); Glance in the Rear View Mirror. Neoliberal Ideology From its Origins to the Present, Haymarket books, Chicago, 2012, etc.
See his bibliography:
He co-authored World debt figures 2015 with Pierre Gottiniaux, Daniel Munevar and Antonio Sanabria (2015); and with Damien Millet Debt, the IMF, and the World Bank: Sixty Questions, Sixty Answers, Monthly Review Books, New York, 2010. He was the scientific coordinator of the Greek Truth Commission on Public Debt from April 2015 to November 2015.

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CADTM Europe

Le CADTM Europe (Comité pour l’abolition des dettes illégitimes) est présent en Grèce, en France, en Belgique, en Espagne, en Suisse, en Italie, en Pologne. et au Luxembourg Au niveau mondial, le réseau CADTM est implanté dans plus d’une trentaine de pays.

Miguel Urbán Crespo

Député européen pour Anticapitalistas et membre du groupe parlementaire The Left au Parlement européen.

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Andrej Hunko

député de Die Linke

Cristina Quintavalla

membre du CADTM Italie

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