The Dilemma of European Industry: A Crisis of Value and Structural Constraints

Volkswagen plans to cut 100,000 jobs by 2030. Its Osnabrück plant will be sold to an Israeli arms manufacturer and converted to military production. In France, Renault and Thales have agreed to develop combat drones. Is rearmament replacing civilian industry? And who decides on questions like that? 

For years, the promise was that Europe would lead a green industrial transformation, securing prosperity and good jobs through technological innovation. For many workers, the present looks very different. More often than not, the promises of “transformation” have materialised in layoffs or plant closures. And those that are most affected – the workers themselves – have no say in that at all.  

Now, the debate has changed: Green industrial transformation seems almost forgotten. Now, politics and industry talk about saving industrial employment through military production. For those whose livelihoods are at stake, this is no abstract discussion. The pressure to accept whatever keeps a factory open is immense. But how did the range of possible futures become so narrow? What happened to the ambition of a European industry that is compatible with its social and ecological needs?

In her speech on the State of the Union, Ursula von der Leyen emphasized that increasing the EU’s competitiveness was top priorities. The language is familiar. In the name of competitiveness, wages are being cut and capacities reduced. But competitiveness alone is not an argument: The questions of what should change, who should pay and what the outcome should be remain unanswered in this debate.

In The Dilemma of European Industry: A Crisis of Value and Structural Constraints, our colleague Federico Tomasone examines the debate through the lens of monetary circuit theory. The paper connects the pressures felt on the factory floor with the decisions and motivations of financial and institutional powers across Europe. 

Europe’s considerable wealth, accumulated knowledge and productive capabilities clash with the reality of the enormous unmet needs of people in Europe and beyond. This is not simply a question of individual company strategies or the policies of certain institutions, but of the conditions under which investment takes place and power is exercised.

Tomasone’s perspective includes wider political consequences: A factory is not just a workplace, but the crystallisation of knowledge and expertise. It is part of a wider social fabric. Decisions about its future reach into housing, public services, local businesses and the economy of an entire region. Yet the people who will live with those consequences are rarely even considered as active participants of the debate and decision-making.

For trade unions, social movements and the European left, the challenge is huge. Immediate struggles to defend employment cannot wait for a different European economic order. At the same time, there is a need for a strategy that unites the struggles in defence of industrial workplaces into a broader political project, capable of influencing the direction in which European industry develops.

The paper contributes to that discussion by investigating the deeper roots of the crisis and exploring feasible alternatives worth fighting for. It offers a basis for debate among those confronting industrial transformation in different workplaces, countries and political traditions.

Who decides what Europe produces, where and for whom? Read the paper and join the debate on a democratic future for European industry.