Wednesday 22 June 2016

The EU Isn't Working

Nigel Willmott writes:

On Thursday, despite a wobble over the horrible killing of Jo Cox and Ukip’s appalling poster, I shall be voting to leave the EU – the same way I voted in the 1975 referendum.

However, there is no straight line from one to the other.

I have been for many years a strong supporter of the EU and am slightly surprised to be making this choice. But an EU that is now based on mass unemployment and mass migration is not one worth supporting.

Official unemployment is 9% across the union and over 10% in the euro area.

And those figures are flattered by unemployment rates of just over 4% in the EU’s biggest country, Germany, and the UK’s rather dubious 5%, which excludes the millions on zero-hours, part-time and temporary contracts.

In Greece, 24% are unemployed and 20% in Spain. Youth unemployment (under-25s) is 51% in Greece, 45% in Spain, around 40% in Croatia and Italy, and over 30% in Portugal, with an average of 19% across the EU.

The only response in an austerity-bound EU is migration.

It was somewhat odd to hear Jeremy Corbyn, the leader of the party of which I am a member, explaining this matter-of-factly and with obvious approval, given the overtones of Norman Tebbit’s “on yer bike”.

And it needs to be remembered that this is not a temporary phenomenon at the bottom of an economic cycle. This has been the situation more or less since the financial crash in 2008.

If anything, we are probably near the top of a cycle with a downturn more likely than a new burst of economic growth.

Apart from the obvious impacts of unemployment on those immediately affected – poverty, lack of status and sense of worth – it keeps down wages generally for those sectors of the labour market affected.

It is this widespread sense of insecurity and fear that drives the growing rightwing populism across the continent, just as it did in the 1930s.

The official position of most of the UK left (Labour, unions, Greens, nationalists) is that we should remain and reform. But that seems to be more wishful thinking than practical reality.

Surely the treatment of Greece alone would serve to undermine the claims that the EU is based on cooperation and solidarity.

And it is not just Greece where democracy has just been cast aside. In Italy, an elected prime minister (albeit one held in contempt) was forced out of power for an unelected technocrat.

In Portugal, leftwing anti-EU parties were prevented from forming a government and pursuing their anti-austerity policies.

But it can change, says Europe Isn’t Working, the single currency euro regime means that Europe’s nation states can no longer devalue their currencies to deal with uncompetitiveness: they must devalue the wages and conditions of their workers instead.

At the moment, it seems that the pooled sovereignty of the EU is part of the problem, not part of the solution to growing European inequality and poverty.

There is an even bigger issue, in my view, than current policies of the EU, and that is the very survival of the postwar social democracy that provided full employment, and welfare states that lifted hundreds of millions of ordinary working people out of poverty and insecurity for the first time in history.

Next weekend, after the likely vote to remain, the Tories’ squabbling chums will be uniting the party over a kitchen supper so they can get on with their main task of privatising what is left of the welfare state – schools through multi-academy trusts and the NHS through the competitive tendering process.

This is part and parcel of the single market and open trading policies that EU supporters – of right and left – sign up to and praise.

Those who believe we can stay in the EU and scupper the Transatlantic Trade and Investment Partnership (TTIP) or exclude healthcare are almost certainly deluded.

The postwar social democracies may have been set up in a climate of internationalism after the second world war, which saw the creation of organisations such as the UN and Nato, decolonisation and international aid programmes, but social democracy was very much a creation of the nation state.

Each of the developed nations of Europe and the Americas created their own versions on their own timescales.

The essential feature of social democracy is that it imposes regulation and restraint on the power of capital and the economically powerful.

So-called globalisation – we have always had global trading, this is just the latest version – was a means of escaping those rules and constraints and reinstating winner-takes-all capitalism, by bypassing the boundaries imposed by nation states.

Along with many others, I hoped that the EU would be a gradual evolution and extension of those social democratic principles to the international arena.

But the truth is that after the Maastricht and Lisbon treaties, the EU has become the opposite and is now basically part of the free-market counter-revolution.

If we wish to maintain social democracy, we have to restore and buttress national powers. We need to step back and let the economies of Europe converge better before we can consider more integration.

The great and the good have queued up to tell us the wonders of the EU and the perils of Brexit.

But on Thursday a majority of working-class people will vote to leave what has become a sclerotic, over-centralised and undemocratic set of institutions, imposing economic austerity and unemployment to pay down the debts of an unregulated and greedy financial system.

Not for the first time, the ordinary people at the sharp end show the better political judgment, however badly articulated.

There are, of course, unknown risks to voting to leave. But the risks to remaining in the present EU are quite clear.

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