In the light of debates about how the left should relate to Brexit, Joseph Choonara discusses a new book examining the structural problems of the EU.
The People’s Vote march in London on Saturday 20 October, which, whatever the exact numbers, was one of the largest protests since the start of the new millennium, marked a strange fusion of social forces. On the one hand, many of the speakers at the march, along with those bankrolling the publicity and transport, were firmly part of the establishment.
They included Liberal Democrats, pro-Remain Tories, such as the MP Anna Soubry, along with representatives of the Labour right such as MP Chuka Umunna — for whom the march was, at least in part, a challenge to Jeremy Corbyn’s leadership of the Labour Party. Above all, though, these forces were motivated by a desire to reverse the vote to leave the European Union (EU), a vote seen by the most powerful sections of the capitalist class as damaging to their interests.
Nonetheless, many of those who joined the march were motivated by genuine revulsion at the Tory Brexiters’ conception of exit from the EU, fear and insecurity reflecting the chaotic process of the withdrawal negotiations, and, in some cases, support for the three million or so EU citizens whose future has been plunged into uncertainty. For this group, which includes large numbers of working class people, students and sections of the radical left, the EU increasingly appears as a shield against what is seen as a relentless drive towards racism, nationalism and neoliberalism.
However, that conception of the EU would surprise many of those whose politics was formed in an earlier period. For instance, during the 1975 referendum to join the European Economic Community, forerunner to the EU, the bulk of the Labour left, along with major trade unions and most revolutionary socialists opposed membership.
The repositioning of much of the social democratic left away from their hostility to what was seen as a “bosses club” and towards support for the EU came as the 1992 Maastricht Treaty was being crafted and adopted. This treaty, argues Costas Lapavitsas in The Left Case Against the EU, paved the way for the launch of the Euro and enshrined anti-democratic, neoliberal norms at the heart of the EU.
Yet the assault of Thatcherism on workers in Britain, combined with the abject failure of the social democratic government of Francois Mitterrand in France to win serious reforms, led sections of the left to identify the EU as a defender of workers’ rights. Indeed, Jacques Delors, who had been Mitterrand’s finance minister and led the European Commission during Maastricht, promised during a famous speech to the TUC that the EU would “improve workers’ living and working conditions” and extend “collective bargaining”, while maintaining “existing social protection”.
Both tendencies — neoliberal brutality and support from sections of the left — have only intensified in recent years.
Lapavitsas, a Marxist economist, draws on his prior work on the Eurozone crisis to show how capitalist interests, particularly those of German capital, were implicated in the structural problems that accompanied the formation of the Euro. The suppression of German workers’ wages to increase productivity, along with the monetary policy adopted by the European Central Bank (ECB), allowed capitalists in the country to expand their exports.
The huge profits made were then channelled into flows of credit into countries such as Spain and Greece — and prior to the crisis this borrowing took place at interest rates similar to those in Germany. The weaker economies of Europe accumulated unsustainable levels of private debt. As flows of capital into these economies reversed during the global recession of 2008-9, they faced a debt crisis mirroring those experienced by many economies in the Global South since the 1980s.
The response from the EU would also have been familiar to those who have witnessed structural adjustment programmes imposed on African and Latin American countries in the past. The Troika — the IMF, ECB and European Commission — imposed “fiscal austerity and wage reductions, along with deregulation and privatisation,” writes Lapavitsas.
The Troika was “unelected and largely unaccountable…democracy would be deliberately side-lined” in order to protect the largely German and French banks that were exposed to the debt crisis. As Lapvitsas argues, “Not a single economic or social decision could be made by the Greek state without the agreement of the Troika.” The result: the Greek economy contracted by one quarter from 2008 to 2016.
So harsh were the measures imposed that even the IMF increasingly advocated debt relief for Greece, a call rejected by the two EU bodies within the Troika.
Lapavitsas is unsparing in his criticism of the leadership of the Greek party Syriza — in particular the prime minister Alexis Tsipras and his first finance minister Yanis Varoufakis — who led the government during its negotiations with the Troika. Tsipras and Varoufakis, for all their criticisms of the bailout plan, simply could not countenance a radical break with the EU or the Euro.
Faced with the incontrovertible evidence of the EU’s complicity in the Greek social crisis, some on the left, for example the Diem25 movement founded by Varoufakis once he left office, have challenged the EU’s neoliberalism and disregard for democracy. Yet they argue that it can, indeed must, be reformed.
Lapavitsas rejects this. The EU is not structured like a national government which can be pressured from below to introduce reforms. He argues against both the “inter-governmentalist” theorists, who see the EU as simply a collection of independent nation states, and the “neo-functionalistists”, who view it as consisting of supranational institutions with an autonomous interest in ever-increasing levels of integration.
There are indeed powerful bureaucracies associated with the European Commission, ECB and European Court of Justice, and these cannot be reduced to a collection of national interests. But they are subject to the pressure of the dominant capitalist powers — both states and large firms — present in the region.
The solution, for Lapavitsas, is not to try to reform this “transnational juggernaut haphazardly thrown together and rolling in a neoliberal direction”, but to break with the EU in order to accelerate its disintegration and restore “sovereignty”.
This latter term, however, is a contentious one, which requires careful handling. “Sovereignty” has, after all, become a rallying cry of the pro-Brexit right in Britain. For them, restoring sovereignty is an exclusionary, nationalist project. It means a hostile environment for EU migrants, refugees and Muslims — along with advocacy of a utopian free-market project in which Britain doubles down on its role as a hub for global finance.
Lapavitsas means something quite different. He is certainly no racist. For instance, he writes of the refugee crisis of 2015:
“Waves of desperate people, mostly from war-torn Syria, crossed the Aegean Sea from Turkey to Greece seeking passage primarily to Germany, Sweden and Denmark. Their numbers were not dramatic but their plight certainly was. If any of the highfalutin notions about the EU were actually true, the refugees ought to have been treated in accordance with EU law, consensus and institutional solidarity. Reality proved vastly different.”
As EU states scrambled to prevent refugees reaching the core of Europe, the dignity of the continent was rescued only by “a vibrant grassroots movement that actively supported refugees and migrants”. It was this movement that helped to forge organisations such as Stand Up to Racism.
Lapavitsas is right to challenge the idea that there is an emergent pan-European sovereignty, in which European institutions are somehow analogous with traditional national political institutions, and in which a pan-European working class faces off against a pan-European capitalist class. As I wrote during the British referendum:
“A break with racism and neoliberalism can only start…through a challenge to the power of the ruling class in the various…states, with movements building their own networks of international solidarity across borders. If the left in Greece were able to smash austerity…it would be an inspiration to radical forces across Europe and beyond… Yet it would be, in the first instance, a movement of Greek workers…rather than a uniform pan-European movement focused on the structures of the EU. Making a break with austerity conditional on agreement at the EU level, as the Syriza leadership has, threatens to strangle the real process of struggle through which change can come.”
From this perspective, Lapavitsas is also able to see more clearly than most what lay behind the British vote to leave the EU. Divisions in the British ruling class, he argues, created a space in which working class people could vote against the dominant establishment Remain position. “It was a vote by proxy against austerity, poor jobs and the decline in welfare provision,” he argues.
This is why the call to re-run the referendum taken up by some in the Labour Party is so misguided. As Neal Lawson, a pro-Remain commentator, observed in a recent article:
“I can’t bear to think what a second vote would do to the hearts and hopes of the people who voted for Brexit, who for once trusted the system, who had a democratic outlet for once in their life — only to find that they didn’t. Politics and democracy has already failed them, closed their industries, marginalised and humiliated them — and then offered a huge scream button to hit in the shape of the referendum, which they duly pressed. Could they now have even that last bit of power taken away?”
This scenario would be a gift to the radical right, who seek to drag discontent with the establishment in a racist and nationalist direction.
Lapavitsas instead advocates the kind of progressive economic change offered by Jeremy Corbyn and John McDonnell, which is far easier to achieve outside the framework of the EU. However, I take issue with two elements of Lapavitsas’s argument. The first is his emphasis on the ushering in of a new industrial policy on the basis of a reformist politics oriented on the state. I would, of course, love to see Corbyn in Downing Street as soon as possible.
However, unless this project of transformation becomes embedded in far more powerful extra-parliamentary struggles, I see little prospect of Corbyn, faced with the might of the British and European ruling classes, not to mention the quislings within his own party, winning the kind of change that both Lapavitsas and I would like to see.
In this sense, Lapavitsas is following the logic of the left wing Popular Unity party that broke from Syriza in 2015 during the first Tsipras administration. Their logic was to revive Syriza’s advocacy of a combination of parliamentary and extra-parliamentary struggles, while rejecting its support for the EU and Euro. Certainly this was a step forward, but it neglects the extent to which an orientation on electoral success and the capture of state institutions tends to subordinate workers’ struggles to an auxiliary role.
Second, I think it is a mistake to write that the left “should argue in favour of controls on the movement of goods, services, capital and people, in the absence of which it would be impossible to apply a radical programme in the direction of socialism”. While I have no problem with states imposing capital controls, and I consider imposing restrictions on goods and services to be a question of tactics rather than principle, the free movement of people should be defended.
I see no reason why the radical left has to disavow the existing freedom of movement within the EU, limited though it is to EU citizens, in order to strengthen democratic control and a move towards socialism. Indeed, to me it seems to make concessions to the reactionary arguments that identify migration with the parlous state of wages and public services that many workers encounter, an argument that simply emboldens the radical right.
Indeed, working with organisations such as Stand Up to Racism, the radical left must redouble its efforts to protect and advance the rights of EU citizens. Failure to do so would be to surrender this ground to EU migrants’ unreliable allies on the Labour right, and worse, who would happily sell them down the river once they cease to be useful in making pro-Remain propaganda.
Despite these two caveats, Lapavitsas’s new book provides important resources and insights for a left argument in defence of internationalism and radical change, and in opposition to the neoliberal monster that is the EU.
Costas Lapavitsas, The Left Case Against the EU (Polity, 2018), £14.99