Nigel Farage launches a pamphlet on a trade exit from the EU, June, 2015. Demotix/ Guy Corbishley. All rights reserved.Expect an invitation from Nigel Farage soon. If you are on the British left and support democracy, the UKIP leader, no doubt full of mock-pathos, will ask you to join him in opposing the European Union. Arguing that the EU has crushed the democratic hopes of tiny Greece, he will say it is better to be outside altogether. But although the European Union in its present neoliberal form depends on the single currency to enforce its brutal political logic, the problems of the EU and the euro are not the same. Different policies will be required to answer the challenges of two different problems. Farage's solution - rejection of all internationalism in favour of pure national sovereignty - is no more equitable a solution than remaining in an unreformed EU.
The British left is deafeningly silent on European Union membership because decades of Blairite social liberalism have silenced its national-democratic instincts. Moreover the radical right, in the form of UKIP and much of the ruling Conservative Party, dominates the debate on Europe. Many on the left prefer to believe that the EU is a simple blank slate that reflects the predominant ideologies of whoever happens to be in charge, instead of accepting that it has an institutional and socio-economic logic of its own.
There is a clear line out of this confusion. The research of Alan W. Cafruny and Magnus Ryner, especially in the book they edited, A Ruined Fortress?:Neoliberal Hegemony and Transformation in Europe (2003) helps us grasp the current impasse. These unorthodox historical materialists present an overwhelming amount of evidence that the Europe of social welfare and corporatist labour relations is dead and buried. The tipping point was the 1999 launch of the single currency, since when "a novel and qualitative transformation in the nature of the Union" (4) has taken place. Which is to say, the euro did not simply supplement a pre-existing institutional mix, but was rather introduced as the means of securing radically new directions of policy.
At the high point of europhilia, during the 2000s, when European intellectuals and academics lined up to praise the transnational model of "social Europe" (if not always the war-mongering aspects of its foreign policy), the political logic behind the euro was trashing that postwar legacy. Through the 2000 Lisbon Agenda, European institutions and European national leaders, whose overlapping but often complementary jurisdictions drove integration forward, proved they were unanimously ‘pro-market.’ The model of combating stagnation and low employment across the EU was to smash up social protections and introduce market-based ‘competitiveness’ into inflexible or heavily-regulated industrial sectors. In other words, it was neoliberalism incarnate. Today its failure is widely acknowledged, even among European leaders. However, the institutional legacy and the political logic remain very much in place.
The European Monetary Union (EMU), offspring of neoliberal European integration, is a mechanism for enforcing the political will of European elites. The agonising destruction of the Greek economy since the first bailout in 2010 attests to this. Ever more onerous austerity has been heaped onto the people of Europe since 2010. The no vote in Greece's recent referendum was widely described as a simple no to austerity, though not to Europe. But that is not quite true. The no was a vote against the neoliberal politics of the eurozone. Once again, this characteristic of the eurozone is not down to the various ideologies of its leaders. Austerity is imposed by the single currency as such, or rather by the political logic that is embedded in the single currency.
The euro is the primary weapon of enforcing "competitive adjustments" and "internal deflation" on member states in imitation of the German model. It is also increasingly used to cow members into dismantling their welfare states and labour market protections. Exit from the euro or sustained social collapse are the only choices now facing Greece. The Greek economist and Syriza MP Costas Lapavitsas recently spoke of the way in which the euro "crystallizes the class logic of the European elites." Lapavitsas is, along with others including the Keynesian economist Heiner Flassbeck, responsible for originating the definitive critique of the euro as a weapon of neoliberal financialisation. In his analysis, the monetary union imposes a deliberate political logic, one which has repeatedly failed to create equitable growth. Instead it has worked to Germany's advantage while crushing less competitive peripheral states. It is inevitable, then, that any convincing progressive movement in Europe will have to challenge the EU's most grievous mechanism of enforcing neoliberalism, the euro.
The European Union, in its current form, depends on the European Monetary Union and its harrowing neoliberal political logic. But that does not mean that the European Union and the euro are reducible to the same political problem. Indeed, in cases like Britain, which is not a member of the eurozone and probably never will be, this distinction can be brought into quite sharp relief. Britain is not subject to the mechanism of the single currency. It has the means of imposing austerity all by itself - and has ably demonstrated it. British elites do not need Brussels to do their dirty work for them. They remain very much powerful enough to do it all by themselves. This is the manifest deception in leaving the European Union. Britons will be trading one balance of forces within the European power bloc for another at least as dangerous, if more distinctly Anglocentric.
Farage likes to neatly divide power into simple geographic or ethnic polarities: Brussels vs. Britain. The immigrants vs. the British. The metropolitan elites vs. the Middle Englander family. However, power usually comes from ‘overlapping’ institutional and constitutional arrangements. In the case of the European Union, the supranational body has often operated as a semi-autonomous, relatively disinterested enforcer of legislation that is unpalatable to local elites. This might take the form of basic health and safety legislation or it might take the form of introducing labour market flexibility. While the national state exercises a degree of ‘relative autonomy’ from the national capitalist class, the EU ideally operates with a degree of autonomy not only from states but also from transnational capitalists. This does not, of course, mean that it is anti-capitalist. The EU is simply in a position to take unpopular decisions on behalf of European capitalism as a whole. This has historically been key to driving European integration: the aspects of national sovereignty surrendered by states have invariably been those least useful to ruling elites. Thus the power bloc is enlarged and new balances which reinforce class rule are created. All of which makes the distinction between an anti-sovereign EU and a sovereign nation much harder to create in political practice.
Thus the left is stuck between two competing conceptions of how power should be wielded over the lives of the British working class. The most despicable and reactionary layers of the British ruling class are quite amenable to Brexit, especially those who believe that in Europe the right kind of turbo-capitalist financialisation is not taking root in the right ways. Unless there is a significant change in the balance of political and social forces within Britain in the coming year (which seems unlikely), the answer is bleak but resounding: Britain must remain in the EU. However, with the euro threatening rupture or even implosion, the Union that Britain remains a part of may be changed significantly all the same.