What Next? - Part 11

For Britain (3)

The EEC was created in the post-war period, but its real growth and consolidation arose in the 1960's, as the global economy entered its Summer phase. It was during this period that Britain and other European countries applied for membership. France, under De Gaulle, opposed Britain's entry, because he recognised that Britain's role historically had been to act to frustrate the goal of European unification, so as to promote its own interests, and more latterly its own interests as a surrogate of US capital. It was only after De Gaulle was replaced by Pompidou that Britain was allowed entry.

DeGaulle was proved right. No sooner was Britain allowed entry than it began to act disruptively. The decision to create not just a common market, but a European Union, as the kind of political structure required to regulate and set the conditions for such a market, was taken in December 1972, before Britain's formal membership in 1973. Yet, despite that, Britain has continually baulked at abiding by the rules that such a union implies.

That may have been possible during the 1980's and 90's, when in any case a single market did not exist for many goods and services, including financial services across Europe, but with the EU growing from a club of 6 countries to one of 28 countries, and with the creation of a single market in all goods and services becoming increasingly vital, as part of welding the economic bloc together, as the process of concentration and centralisation of capital once more speeds up, Britain's calls for the EU to move in the opposite direction poses an existential threat to the whole project.

On the one hand the consequences of devolution in Scotland, in creating centrifugal forces, driving the parts of the economy and state apart has been witnessed, and something similar can be seen in Spain, where there is effectively a system of regional governments, with only 30% of the state budget being controlled by the central state. Similarly, Greece, and the crisis in other peripheral economies, demonstrates the problem of having a single currency, with a single exchange and bank rate, but with no single fiscal regime, and each country having to borrow in global capital markets at hugely varying rates of interest to other economies within the bloc.

The real problem of Greece leaving the Euro, besides the effects in capital markets that a Greek default may have, via the destruction of around €300 billion of bank capital – which could take around €3 trillion out of circulation, as well as the unquantifiable effects of huge numbers of credit default swaps being activated - is that it adds to the fragmentation of the market, at a time when greater solidity is required.

It is bad enough that a major economy like the UK sits outside the single currency, with all of the contradictory and fragmenting effects that has, but if instead of increasing the numbers of economies coming within the remit of the single currency, it starts to decline, then the single currency itself will start to look doomed, and soon after it, the EU itself would follow.

Certain nationalistic sections of British capital, reflected by UKIP, and the Tory Euroseptics would undoubtedly be quite happy with such an outturn. But, it would be very bad news for British workers, and would be against the interests of big industrial capital. But, whether that results in a referendum vote to stay in or stay out, cannot be determined, simply on the basis of material interest, or even who may or may not have the most clout at the moment. Actual political decisions do not materialise automatically, but have to be fought for and won, by the actions of real human beings. That is what makes history.

A "Yes" vote in the EU referendum is in the interests of workers in Britain and across Europe. It is also in the interests of social democracy, of big industrial capital. But, it will only arise on the back of an actual struggle to bring it about against all those reactionary forces opposing it. Moreover, social democrats do not have the same reasons for seeking such an outcome as do nationalists like the SNP. They have to demarcate themselves from these alien class forces, just as Labour should not have been part of a cross class formation to oppose Scottish independence.

But, socialists do not have the same reason for opposing a British withdrawal from Europe as social democrats either. Social democracy represents the interests of big industrial capital. That is progressive relative to the conservative nationalist forces based upon reactionary forms of capital, such as small capital and money-lending capital. But, social democracy is not progressive relative to socialism. Because social democracy exists to promote the interests of big industrial capital, whilst utilising the social weight of the working-class to achieve that end, it is always contradictory, and bureaucratic.

Rather than unleashing the full might of the working-class to fight for a thoroughgoing democratic solution, instead it must restrain the working-class, fearful that it would get out of its control, and press ahead with its own interests at the expense of capital itself. It proceeds via a series of bureaucratic manoeuvres, and diplomatic compromises that store up future crises. The interests of big industrial capital would themselves be best furthered, by the creation of a United States of Europe, a single fiscal as well as monetary regime, with common property laws and so on across the state, common welfare benefits and so on. But, social-democracy is unlikely even to advance these limited reforms.

Rather we see Labour responding to the nationalistic programme of UKIP and the Tories with bureaucratic, and similarly nationalistic proposals to limit the rights of EU migrants coming to Britain, which must inevitably spark a tit-for-tat response by other EU member states against British migrants to other EU countries, which in itself begins to unravel the basic right of the free movement of labour that is central to a single market.

That is why we need a Socialist Campaign For Europe, as I will be setting out in coming weeks.