Policy Research in Macroeconomics

No alternative in Europe to a long, hard struggle

This article is from the latest e-publication “Remain for Change: Building European solidarity for a democratic economic alternative” from EREP, the network of Economists for Rational Economic Policies.  

Don’t be conned by those determined to free Britain from EU “red tape” – their catch-all term for employment rights, consumer protection and environmental regulation.

There is indeed a strong “progressive” case against the EU, such as that recently argued by Enrico Tortolano of ‘Trade Unionists against the EU’ in Open Democracy (7 April 2016). We are not only confronted by extreme neoliberal strategies but by the attempt to perpetuate these strategies and to give them quasi-constitutional status through a complex of treaties, directives and policies imposed by creditors on crisis-struck debtor countries. If these violations of democracy are not reversed then the electoral process and the alternation of parties in office will lose a great deal of their meaning.

More questionable is his assessment of the politics of departure from the EU in general, and of Brexit in particular. Dismantling the EU, or radically reducing its powers in favour of those of member states, is an objective of a few left-wing groupings and a small minority of trade unions across Europe.

It is also the objective of right-wing forces, xenophobic or even fascist, across the continent: Fidesz and Jobbik in Hungary, the Kaczynski regime in Poland, Golden Dawn in Greece, the Front National in France, Alternativ für Deutschland – which recently made big advances in Germany – and right-wing “populists” in Scandinavia, Austria and elsewhere.

A break-up of the EU, given the present balance of forces, would represent a move to the right in many countries. It would immediately compromise the position of migrant workers (both from inside and outside the EU), permit a thoroughgoing elimination of workers’ rights, and further undermine human rights and the rule of law across much of eastern Europe in particular, but also in western Europe. The recent reassertion of an absolute ban on abortion in Poland is a token of what women might have to expect in a break-up carried out from the right.

Of course, it is the policies and structures of the EU which have brought about this situation. Anger and frustration with austerity and neoliberalism may in some cases lead to a search for rational alternatives on the radical left, but in many others to an embittered nationalism. Nevertheless we have to take this difference into account. The social discontents behind both choices may be very similar but their outcomes are completely opposite. If the forces which are hostile to the existing EU were united around socialist values and an internationalist agenda then a break-up of the EU might not be such an alarming prospect. But in such conditions a progressive re-foundation of the EU would also be possible. That is not where we are.

Real opportunity to say no?

Similar considerations apply to Britain. Enrico Tortolano writes, 

“The opportunity of the referendum on continuing EU membership offers a real opportunity to say no to austerity and the domination of the banks and to escape the clutches of the most anti-democratic super-state in the world.” 

This would require that a majority for Brexit were seen as a triumph for the labour movement. In reality it would represent the victory of the two reactionary forces which dominate the Leave campaign: on the one hand the anti-immigrant populists of UKIP; and on the other the radical Thatcherite wing of the Tory party – those, such as Michael Gove, John Redwood or Iain Duncan Smith who regard the Thatcherite revolution as incomplete and are determined to free Britain from EU “red tape” – their catch-all term for employment rights, consumer protection and environmental regulation.

These two forces would find a compromise in an attack on immigrant labour (a disaster for the British labour movement) combined with radical deregulation and an economic strategy centred on globalisation and attracting MNC investment with tax reductions and a bonfire of regulations.

It would be good if the British unions were united and strong enough to block such an outcome. But if they are not united or strong enough, then it is simply wishful thinking to base a political strategy on what might be achieved in an imaginary world.

The fact is that the left in Britain, very correctly, is opposing Brexit to avoid the dangers discussed above: the position of the Labour Party, now articulated, perhaps reluctantly, by Jeremy Corbyn will be influential; Scottish and Welsh national parties are taking a pro-EU position, as are the Greens and most of the non-Labour left. This is not going to change between now and June 23.  In any case all of these forces are pretty marginal in the present debate which is dominated by a clash of right-wing groups and, in the first instance, it will be the realignment of right-wing forces after the referendum which impacts on policy.

Sovereignty hot air

When I voted for British withdrawal in the referendum of 1975, it was in the context of a clear political project which commanded very significant support – including Tony Benn who was one of the most important figures associated with the radical programme formulated at that time. In the event that programme was never implemented – it fell by the wayside after Labour’s defeat in 1983. I do not know whether the programme would have been successful, but even if it had failed it would have been much better than Thatcherism. There is no such programme today. A Corbyn-led Labour government could achieve a great deal – but the structures and policies of the EU would not be the first or the most important challenge it would face in an attempt at tax justice or in the introduction of civilised welfare policies.

Democracy implies popular sovereignty, but how much sovereignty is available to even medium-sized countries today? Can issues such as international tax evasion, or financial reform or global warming be effectively addressed by individual countries? It is true that there is no democracy in the EU, but can meaningful popular sovereignty be restored at the level of an individual state such as Britain? The radical right pushing for Brexit can talk about sovereignty but that is because they do not regard social control over economic life as a state function. For the left that issue of social control is primary and it is hard to imagine how it could be exercised without strong supranational institutions.

Is there a clear progressive project which we could associate with the rejection of Brexit? The difficulties are immense because of the stubborn way in which social democratic parties are clinging to neoliberal strategies.

It would be a herculean task either to change that orientation or to replace those parties with radical ones. But is there an alternative alternative? The departure of one or more of the crisis-bound southern member states might not imperil the EU, but could reinforce the position of Germany and its Mitteleuropa neighbours.

The situation in the EU, however, is not static. The erosion of its already weak legitimacy both to the right and to the left is preparing an institutional crisis; the increasing popular awareness of inequality and economic failure is undermining acceptance of current strategies. Clearly the battle for a reconstructed EU will be long and hard and offers no guarantee of success. But to turn aside from that struggle in the hope of a rapid escape might be to pursue a mirage.   

John Grahl is Professor of European Integration, Middlesex University.  This is an amended version of an article first published in OpenDemocracy on 25th April 2016

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