Policy Research in Macroeconomics

Why I will vote Remain

Back in 1975 I did not just oppose membership of the EU, I actively campaigned against it. In the 1990s I strongly opposed Britain’s membership of the Exchange Rate Mechanism (ERM). My opposition to the Labour leadership’s support for ERM helped ensure that I did not get chosen as Parliamentary candidate at the time.  I won a modest6 votes at a General Committee Meeting that in 1991 selected the next MP for Dulwich and West Norwood!  (While I was to be vindicated by Britain’s eviction from the ERM in September 1992 that was no comfort as Labour, having backed the ERM, was unable to capitalize on the huge political damage caused to the Conservatives by the Black Wednesday fiasco.)

Finally, I am firmly opposed to the way in which European Treaties (signed by Labour as well as Conservative governments) have embedded market fundamentalist economic policies into quasi-constitutional law. No doubt this is because the authorities are aware that policies for austerity, privatisation and the financialisation of European economies would be fiercely resisted by the people of Europe, and so had to be buried like concrete, in Treaties.

So why then, am I voting to Remain? The reasons are threefold, and are essentially political rather than economic reasons (Please ignore George Osborne’s “facts” from the UK Treasury. That institution’s forecasting record is abysmal. According to the outgoing Permanent Secretary, Sir Nicholas McPherson, they made the “monumental collective intellectual error” of failing to forecast the biggest ever financial crisis facing Britain.)

First and foremost, the political situation in Europe has changed – and the continent is now on the brink of fracturing. 

Market fundamentalism is dividing the people of Europe, and instead of economies converging across the Eurozone, they are diverging. The situation is of course exacerbated by the EU’s ‘free’ market principles for the untrammelled and unmanaged movement of capital, trade and labour. And for the commodification of land and labour. These liberal finance principles have triggered popular resistance, and caused voters to go in search of a ‘strong man or woman’ that will protect the populations of Europe from the ravages of market fundamentalism. Hence the rise of right-wing and fascist parties in for example, France, Hungary and Greece.

Right-wing populism – a reaction to, and movement against market fundamentalism – now poses a real threat to European democracy, and to European peace and stability. If the UK votes to leave now, this will encourage those who seek the fragmentation of Europe based not on progressive economic and social policies, but on their very opposite. This is therefore not the moment for the people of Britain to trigger the break-up of the European Union. The last time European tensions spilt over into divisions, open confrontation and war, sixty million people died (including twenty million Russians). Britain could not stand aloof from that war, and it will not be able to stand aloof from any future disruption to European peace.

I am not prepared to be party to such disruption at such a tense time in European political history. I am not prepared to risk sending my children or grandchildren to another European war.

There is a second reason for voting to Remain and it is this: Britain is heavily responsible for the market fundamentalism entrenched in the European Treaties. Our politicians and civil servants had a big hand in drafting these Treaties, and in introducing European legislation for enforcing what are in effect Anglo-American policies for deregulation, privatisation and labour market ‘reforms’. It was Lord Cockfield (under the Thatcher government) who led the drive for the single market including ‘freedom’ for financial services and capital, andit was a British civil servant who presided over the creation of the Euro – even though we chose not to be a member of the Eurozone

Europe’s social welfare model has been severely strained by Anglo-American policies for de-regulation, privatisation and ‘structural’ changes to labour markets, now alas more widely shared within the EU. Our responsibility for such policies requires that we act responsibly in helping to get them reversed…We cannot now turn our backs on a European economic model that conforms so closely to British economic policies. The social democratic parties, in particular, need to change tack, to promote policies that challenge the neoliberal consensus.  This is our task in the coming years.

My third reason is domestic – with honourable exceptions, the move to Brexit is led by the most reactionary forces in Britain such as climate change denier Lord Lawson – and it is they who would reap the benefits of an “out” vote.  They stand for market fundamentalism, not for the more progressive EU we seek. The EU’s gains on social and labour standards, on environmental protection and climate change – themselves at risk – would be dismantled.  I agree with Jeremy Corbyn – we should unite to vote to Remain, but for the opposite reasons from those of David Cameron and George Osborne.

6 Responses

  1. Apart from the central fact that nomatter how divided a first past the post system means that politicians must obey the whim of the majority who votes Brexit. There should be no betrayal of this fundamental democratic principle, just as we all had to suffer from double dose of Margaret Thatcher’s, who – I remind you – took Britain to a war where men lost their health and lives because of her intuitive awareness that the British people more than any other are members of a warmongering nation. And you imagine that the British can prevent any sort of military adventures in the EU. I also remind you that the global economic system has failed all but the landowning aristicrats and their pathological admirers and copy cats, and – since a few egotistical billionaires have frightened them away from the financial markets – who have been busy putting all the profits from turning the Chinese and Japanese people into wage-slaves into new and expensive high-rise apartments overlooking the River Thames, in search of liquid asset security when the inevitable global economic crash takes place. It will then be up to the common people of all nations to refuse to take part in any warfare, begun and run – as usual – by those who pull the strings of politicians, not the ordinary people: who are waking up to the gross injustice perpetuated by economists and bankers who will gladly print money for war, rather than to feed the starving millions… which they have a choice to do, instead, right now… as all the common people around the world have been demanding and whose voice will rise up and prevent the war that your fear, knowing how the rich behave better than how the poor think, or will behave when they hear their demands being put into words in a way that they have never been blessed to hear, before. Listen to that voice, which you have heard but forgotten! Have faith in that voice, and not our corrupt parliament that would betray the people again whoever becomes its leader, without the support of the Christ, Lord Maitreya – when the BBC can no longer censor it… as the battle for sanity continues, until economists and bankers are no longer needed!

  2. Thank you for your response, Ms Pettifor. I also read Carlo’s comments with interest

    Let me elaborate my position a little.

    First, we agree that another Euoropean/ world war is not impossible. I go further. If we continue on our present path I believe it is pretty much inevitable.

    The conventional narrative is that the EU has been a major factor in preventing war for the period of its existence, and I hear that narrative used in support of remain, and as a general proposition. It is often coupled with MAD and NATO, as complementary in that respect. I reject it as posited. For me what prevented war was not the standoff of MAD, nor the EU as an institution directly. It was rather the post war consensus on economics which tended to reduce inequality and to increase prosperity . That was represented within the EU as the "social chapter" provisions

    The EU is not what it was. At the outset it had two broadly equal aims: single market and social chapter. Those are not irreconcilable within a Keynesian (again shorthand for an economic consensus about the central aim of full employment, primarily) and there was increased equality, increased growth and a recognition that our interests are not the same, but compromise is a good idea. (That is a very short outline, which I can say much more about if necessary, though I think it gives a flavour as is). Once the neoliberals abandoned consensus there was an open tension between the two strands of single market and social chapter: and the market won. The EU qua EU no longer furthers that consensus: it fractures it in proportion to its commitment to the neoliberal project. And that is increasingly its sole character.

    You are right to be concerned about the rise of authoritarian movements at present. But you seem to imagine that this is mainly a rise of the extreme right. We do well to remember that in the 1930’s both authoritarian wings rose: the left were also "populist" and were perceived as a threat by what I will call the "laissez faire" elite, which parallels our neoliberals today (again forgive the shorthand labels, which might not be entirely accurate: but you know what I mean).

    The people are not wrong. They take a long time to realise it, but ultimately they recognise when democracy is no longer functioning, It is an unfortunate fact that the alternatives they are offered tend to the view that democracy CANNOT function: thus the attraction of the "strong leader", which you note: but also the "strong system" which is the leftist counter on the authoritarian dimension. This is a consequence of TINA when the social democratic left fails in analysis, and is captured by the neoliberals supported by a corrupt media. One depressing feature of the EU debate is the narrow overton window. The kind of discussion we are having now is largely absent, rendering the campaign ( but not the issue)broadly irrelevant to someone like me. I do not think I am alone, despite the media hype.

    I am not pessimistic, in the way you describe. I absolutely agree that there is a change in the air, That should have been clear by my reference to the half cocked fight with the doctors because it is half cocked precisely because the neoliberals within the UK see that change on the horizon and are rushing to complete their project for that very reason. I agree that Corbyn and Sanders are a straw in the wind in that respect. And the opposition to TTIP within europe is a similar straw, However you are wrong to characterise a "leave" position as a walking away from a fight, and I rather resent your implicature. Once again your position is inherently contradictory. You raise the spectre of a vacuum filled by the far right: and at the same time admit this is not inevitable, and cite Roosevelt as illustration. If you are correct (and I think you are, though a far left win is a third option you do not mention) then you must ask yourself what makes a Roosevelt type option more likely. I do not think it is likely that the narrative which we broadly share will gain traction across the whole of europe, with its undemocratic and unaccountable elements, more easily than it will within the nation states.

    We might ask ourselves, using a dangerous metaphor, whether the people are more likely to win a conventional war or a guerilla war. And I think the answer is obvious. The plutocratic hegemony is easily rendered in that metaphor as an empire: and empires are not overthrown by broad uprisings, but by local ones. The tale is flawed. obviously, but I hope the point is understandable.

    Again you say that Greece would have been better to leave the EU: and I agree. It is also true that the people did not want that and so Syriza could not win. But that does not change your conclusion, nor mine. And the benefits of a Grexit were not for Greece alone: Grexit would have opened the way for real challenge to the hegemony, by widening the debate within an EU which for the first time faced a real challenge. As it happened its confidence was increased by the defeat of the Greek people. Do you honestly believe it will be shaken if the UK votes remain? I think rather they will be confirmed in their belief that all is well and TINA intact.

    You also suggest that a UK left which has exited cannot form alliances with social democrats across Europe: to my mind that is absurd. It is much more likely that a UK which has left the EU can, should the change you rely on be followed through, that it will demonstrate to those allies across europe that there is indeed an alternative and it works. A functioning social democratic country will be worth more than milllions of words, in mounting a challenge to plutocracy. This is also analogous to Greece. Alliances and support are not precluded, they are strengthened when there is a clear option on offer.

    The internationalist narrative on the left is strong, and for many years it has been informed by the outcomes in the 1930’s. I recognise it. But the fact is that few want one world government, and it sits beside another principle of "localism". To me, it is a sentimental and confused story, which bears deeper consideration: for solidarity is not the same as identity and have more chance of progress where we have the remnants of democratic control. That control exists in greater degree within the nation state than in the larger body.

    I do not wish to walk away from the fight: I want to win it. And I believe the first step in winning it is to erode the entrenched power of the plutocrat which resides par excellence in Europe as currently constituted.

    A different europe is possible and desirable: but we cannot start from here. We can change it form within? Like the lamb changes the wolf from within, maybe

  3. I have stopped long ago being surprised at the apparent ease with which some people (usually on the Remain side) can hold contradictory positions and reach illogical conclusions. Mrs. Pettifor is just the last example in a long line. She is basically saying: "I’ve always bene opposed ot the EU. The EU fixation with market fundamentalism has brought about commodification of labour, and has severely strained welfare across the Continent. As a (predictable) consequence, populism is on the rise and democracy it’s threatened (so, it’s not democracy if the people don’t agree with her ideas, but that’s by the by). So the only logical conclusion is…more EU! And that’s because if I said no more EU, I would find myself in the same camp as some people I don’t like, and God forbid that might be the case. Because those people are so despicable that even if they said that the sky is blue and the grass is green, I would be compelled to strongly assert that, in fact, the sky is green, and the grass is blue. Pandering to my petty political convenience is more important that drawing the logical consequences about a decision that will influence future generations".

    So she will choose to stay in the EU, and try to change it from within. The fact that the EU institutions have travelled in the same direction for thirty years is immaterial; she, and people like her, will eventually change the EU, sure, this time is different. In the meantime, there will be more misery, more suicides, more suffering, but hey, that’s better than agreeing with Lord Lawson.

    I am glad that she was not around during WWII. I am pretty sure she would have refused any alliance and fought alone, lest that man Stalin could crow about how he helped the Allies defeating the Nazi.

    1. Thank you for your comments Carlo. First, I am sorry you are disappointed in my contradictory positions. When the facts change, I change my mind. What do you do? For me the facts on the ground in Europe have changed. Second, I do not suggest that democracy is threatened by populism – rather that populism is a reaction against market fundamentalism…The threat to democracy comes from the extreme right wing parties in the ascendancy in parts of Europe – which I find alarming. What about you?. Finally I find your remark about being unwilling to build alliances if I had been around during World War II mildly offensive. I am critical of the social democratic parties who at the time of Hitler’s rise, refused to build alliances and bridges with and towards others. I certainly would have argued for such alliances. ..And that is why I now propose that it is important to build alliances with those progressives in Europe (including for example Yanis Varoufakis) challenging market fundamentalism. I think that the European alliance against TTIP is far stronger in its negotiations with the mighty and increasingly imperialist US, than any one country would be negotiating alone.

  4. I read your posts with interest but not much knowledge of economics. So I seldom have anything to contribute. But this one is political and since I admire your work I wished to reply.

    I agree with your first point and it is one of the reasons I reach the opposite conclusion. Indeed I cannot follow your logic. So far as I can see you accept the EU has entrenched the very economic policy which leads to the fragmentation you note. So far so good. You rightly point to the potential for a re run of the 1930’s (shorthand) and to polarisation and ultimately war. But then you do something odd. According to you the break up of the EU, should it follow Brexit, will make that more likely. Since you have already identified the EU as a cause, how does that make sense? I accept a break up may not avert it, by now. But I am convinced that continuing the policies which have produced the situation is much more likely to lead us there.

    On your second point, again I agree that the UK is a front runner in altering the essential character of the european social model of the past. The "anglo american" model is now entrenched by treaty, as you say. But again, you propose to improve this situation by doing more of the same. I see no chance whatsoever of the UK mounting a challenge to a policy prescription we have strongly and successfully imported (naturally not alone in that; again shorthand) to the EU over decades. Nor do I see a united social democratic movement ready and waiting to challenge it from within or from without. That will come, but it is not here yet, and if the remain camp win this referendum, it will be taken as an endorsement of TTIP and further entrenchment of the model you rightly identify as a dangerous casus bellus in the future. I realise that many believe we can change it from within, If the will was there, we might have some small chance of success, since there is a constituency. But it won’t be represented by the current UK government, especially since it seems to fear its days are numbered and so seeks to entrench its economic madness beyond hope of reverse, before it loses office. Thus the fight with the doctors and about the schools is premature, if you look at their strategy for such change in the past.

    You may argue that that observation implies that soon we will have an alternative government which can do as you say. But I see no sign of a coherent understanding of the root and branch folly of the current hegemony anywhere in the UK political landscape with a chance of winning the next election. A vote to remain will not further the rise of such an understanding IMO. A vote to leave just might, however, and not only in the UK.

    Your third point is partly true. Many Brexiters want to pursue the madness more freely and that is their motivation. However the argument that the EU protects us from that is not sustainable on the basis of your first two points: for those who lead the remain camp have exactly the same objectives. We do not have the luxury of siding with just good guys, no matter which way we vote. As you say, there are those who share your aims on both sides, though you’d never know from the "debate" as reported.

    Nonetheless the example of Greece demonstrates very clearly just how much protection EU membership affords. It is part of the problem, not of the solution. And those gains you mention are already being dismantled by the EU itself.

    1. Thanks Fiona…and you make many very good points. And apologies if my case is not entirely logical. It is largely based on gut instinct that Europe is fracturing, and that Brexit would make things worse not better, and its a gut feeling that another European war is not impossible. …And yes, you’re right that one cannot depend on UK governments…but I don’t quite share your pessimism. There is something afoot out there…a wave of British dissent which has carried one politician, Jeremy Corbyn into a post he never expected to occupy. (That wave is also the one that has carried Bernie Sanders much further than expected)….That wave of dissent is a rejection of both the British political class, and the media establishment…who knows what else the wave could produce? Or what direction it could take – left or right? What I do know is that at times like this it is not for progressives to walk away from battle grounds, leaving the far right to occupy vacant political space. In the 1930s, the social democrats in Germany refused to build alliances, to build bridges, and left political space open for the right to occupy…Europe moved to the right, and towards fascism. But in the US something different happened…Roosevelt appeared on the scene, more or less out of the blue, fought a Wall St. Democrat for the nomination and won….and strengthened American democracy, the very reverse of what happened in Europe.

      I have a sense that rather than withdraw into our own small island, we would do better – at this time in history – to build alliances with the many millions of Europeans who are unhappy with the current state of affairs; who are bewildered and are looking for leadership…At the moment, my fear is that the leadership is largely coming from the right…I would like to add my voice and support to those at the progressive end of the political spectrum, fighting for a more economically just and balanced Europe.

      And on Greece: I have thought long and hard about Greece, and as you know, have argued that Greece should exit the Eurozone. But that is not what the people of Greece want. They want to belong to a broader European community…they too yearn for peace. I think its illogical…but I have come to respect their view, and to believe that we should not abandon them to their "illogical’ stance, but stand alongside them and help to challenge the economic policies that inflict such grave harm.

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