In Heading for a Lost Decade? roarmag.org founder Jerome Roos prepares Europe's anti-austerity activists for a longer struggle than many probably had imagined - and none certainly had hoped for - just a few years back.

Looking for historical precedents to the current economic crisis in Europe, Roos finds no comparisons with the explosive collapse of Argentina in 2001-2 that led to the establishment of popular assemblies in Buenos Aires, a large-scale movement of unemployed worker's and factory take-overs across the country. Rather, Roos finds comparisons with the drawn out debt crisis in Latin-America often referred to as the "lost decade":

A wave of defaults by the Latin debtors (...) threatened the very stability of the global financial system, while the syndicated nature of lending allowed the banks to organize a closely-knitted “creditors’ cartel”. Colluding with the US government and the IMF, the banks isolated the debtors through a case-by-case approach to debt negotiation, pitching a united creditor front against a series of helpless individual debtors.

As a result, the new financial structure allowed the big Wall Street banks to exert enormous power over their debtors, without even having to resort to lobbying or other direct forms of exercising political influence. By the 1980s, the power base of the big banks had become structural in nature: if the debtors failed to pay up, the bankers could credibly threaten that they would cut the debtors off from the global financial system altogether simply by immediately withdrawing all outstanding investments and refusing to extend any new credit.

This ability to withhold and withdraw credit — which would have had dramatic consequences for the ability of Latin American governments to import food or oil, for instance, or to continue funding basic social expenditures — gave the Wall Street banks a unique form of structural power over debtor governments. Working together closely with the US Fed, the Treasury Department and the IMF, large bailouts were organized that imposed highly punitive conditions on the debtors, while always insisting on full repayment for the banks.

In his article, Roos describes a similar situation in Europe today, because "debt concentration in the biggest and most powerful banks" has made default a near impossible option:

When the European crisis first hit in early 2010, those players who stood to lose the most were the powerful banks of the core. These banks had become so systemically important to the global financial system that a collapse of one of them would have had dramatic repercussions for the system as a whole. Ironically, this vulnerability gave the banks enormous structural power over the process of crisis management: without even exerting any direct pressure, the banks could virtually outlaw default as a realistic policy response.

In other words, Latin America’s lessons for Europe are more troubling than one would think. When sovereign lending becomes concentrated in the hands of a few systemically important and structurally powerful banks, the interests of debtor nations will tend to be undermined in dramatic fashion — with all the concomitant repercussions for living standards and democratic processes. Rather than expecting an Argentine-style default anytime soon, perhaps what we really should be expecting is another lost decade of austerity and deferred dreams.

Why Roos thinks it is still important to keep struggling, and what strategies anti-austeriy activists might take can be read in the article on roarmag.org.