When we were organizing the ideas in order to write this text (in May 2010) the economic system of some Mediterranean countries, especially Greece, Portugal and Spain, was the target of the attack of 'financial fascism', so called by one of the most distinguished thinkers nowadays (Boaventura de Sousa Santos) in the Portuguese magazine “Visão” (no. 896 the 6th May, p.30). This new ideology, whose main representatives are the rating agencies, is far from that of the 30s; it has more devastating features and more global effects. Comfortably installed in 'Wall Street' or in the 'City', they decide the future of the countries and entire communities.

The current democracies of these countries have shaken their structures, a fact that could lead to social chaos and misery, mainly among the most disadvantaged social classes, such as pensioners. The governments of our countries have tried (with different results) to make the effects of low credit qualification of public debt rating not to drive us to social destruction with devastating effects. The three countries submitted Stability and Growth Pacts (SGP), that will result be translated in a loss of purchasing power and in a reduction of the saving potential in a few months (or maybe years?).

Specifically in Portugal, the VAT has increased in all its scales, with a disastrous influence in the economy of the families and the social classes who are already dealing with big problems. An increase of the VAT to more than 20% (it would be increased from 5% to 6%) on essential goods (bread, milk, water, transport, electricity...) is making it more and more difficult for these people to survive because they already spend an important part of their wages on these products.

Civil servants, as well as politicians, will also suffer the wage cut and a general income tax increase to 1-1.5%. The reduction of the salary bonus that has been imposed in Greece could be also applied in Portugal. This situation would not be new for the Portuguese, as we already suffered this unpleasant experience in our disposable income 30 years ago. (As imposed at that moment by the IMF, the Christmas salary bonus was applied to 'Public Treasury Securities', which were freezed for three years).

And what about pensioners? Portugal is one of the countries with the lowest per capita income in the EU. And the population undergoes this situation everyday, but pensioners suffer the most due to their social condition even more.

In general, pensioners do not have unions to represent them. Elder civil servants still have their pensions minimally updated. This happens because pensions are indexed to the securities that unions obtain for those who are on active service. In the general system, where pensions are lower, the updating is decreed by the administration. This entails that the updating does not always correspond with the value of inflation.

Therefore, Portuguese pensioners are in an even more difficult situation than their fellow citizens, the active workers. As long as they do not bring pression on rulers, the consequences of 'financial fascism' will be stronger in their daily lives and dramatic consequences are suspected to take place in a country where suicides in elderly people reach alarming numbers.

Despite these difficulties and dark perspectives, we keep a positive point of view and believe that we will overcome the crisis in the following months (or maybe years?). Also, the value of our history throughout more than 850 years of wisdom and struggle will surely drive us to a happy ending.

Candido Trabuco Vintem – ANAC – Portugal