Industrial policy in one country? A response to Costas Lapavitsas


By Martin Thomas

The economist Costas Lapavitsas, who has done important work on financialisation, has written a widely-cited article for the US magazine Jacobin (30 May) to argue that Labour should back Brexit after all.

Indeed, his article systematically cites the “hardest” sort of Brexit — where Britain has no arrangement with the European Union to reduce economic barriers other than that given by general World Trade Organisation rules — as preferable.

Up to now, very few pro-Brexiters, outside a few right-wing nationalist Tories, have described that “no deal” Brexit as anything other than an admittedly damaging “worst case”.

Lapavitsas was a member of Syriza, one of the left-wingers who quit after the Syriza-led government capitulated to the EU-ECB-IMF impositions to form the Popular Unity party. Popular Unity’s line of agitating for “sovereignty and independence… against the new colonialism”, rather than for explicit socialism or a Europe-wide working-class policy, has proved unproductive. Although PU started with 25 of Syriza’s 149 MPs, and other prominent Syriza figures, it lost all its MPs in the September 2015 election, now polls between 1% and 2%, and has not rallied a large part of Syriza’s former left-wing base.

The same sort of line would also be unproductive for the left in Britain.

Lapavitsas makes the valid point that the Single Market today is structured on very neoliberal lines. No wonder. Back in the 1980s, when EU leaders talked much and did a little about “Social Europe”, other leading EU governments saw Thatcher’s neoliberalism in Britain as an “Anglo-Saxon” aberration.

Since then labour movements in EU countries have suffered setbacks, and other EU governments have come nearer to catching up with Thatcherism. Neoliberal governments produce neoliberal policies. The problem is that the Single Market has become more “British”, not that Britain has become too “European”.

He also comments, validly, that Single Market rules often work on a ratchet principle. Existing social provision and public enterprise are allowed, but reverting from marketisation to social control is made difficult.

But “hard Brexit” cannot be a left-wing policy. The struggle for socialism is an affair of workers vs capitalists, not of Britain vs a “Europe” identified solely with neoliberal Brussels officials. Consider four points.

First: EU rules would not block anything in Labour’s 2017 manifesto. Domestic capitalist power would try to block some measures, and might try to draw the European Commission in on it, but by far the main obstacles to those measures lie within Britain.

Second: The frontline measures which the socialist left wants to see added to that manifesto would not be blocked either.

Restoring union rights to solidarity action, to quick responses, to picketing, would not be against EU rules. In fact, France has wider, better union rights than Britain had before Thatcher.

Restoring NHS funding would be against no EU rule. Both France and Germany spend markedly more on health care, as a percentage of national income, than Britain.

Restoring local government autonomy and funding, and thereby reviving social care and libraries, would be against no EU rule. Ditto for restoring welfare benefits.

Large measures on those lines would face domestic capitalist resistance much more than any hindrance from EU rules.

Third: the Single Market rules have become neoliberal not because they are “European” and “foreign”, but because they represent a trend of capitalist development pioneered… in London.

“Europe” in Lapavitsas’s picture, is just the neoliberal officials in the European Commission and the ECB. Workers? Labour movements? The argument proceeds as if no such things exist anywhere in Europe except in Britain and Greece.

Labour should certainly be pushed to policies which really would contradict Single Market rules. If the British labour movement rouses itself that far, then it can and must rouse labour movements elsewhere in Europe to do similar.

The reaction elsewhere in Europe to socialist mobilisation in the labour movement in Britain (if Britain happened to go first) would not just be anger from neoliberal officials in Brussels. Workers and labour movements across Europe would be inspired and energised.

The outcome would depend on the conflict between capitalists and workers right across Europe, not on legal battles between the British government and the European Commission.

Fourth: right now we face the danger of a real “hard Brexit”, not Lapavitsas’s imaginary “socialism in one (British) country”, or rather “‘industrial policy’ in one country”.

That Tory, or modified-Tory, “hard Brexit” will set us back in many ways. We should fight it, not accommodate to it by way of telling ourselves tales about it mutating into “semi-socialism in one country”.

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