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Betraying Europe and the danger of collapsing integration

by Andreas Bieler on March 22, 2017
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Brexit demonstrated clearly what many had perceived to be impossible: European integration is reversible. The potential breakup of the European Union (EU) has been welcomed by people on the political right as well as some on the left. While the former hail the return of national sovereignty, the latter often perceive Brexit as an important blow to neo-liberal, austerity Europe. In this blog post, I will critically assess these claims and highlight the dangers implicit in current developments. What many opponents overlook is the historical achievement of the EU to overcome long-standing, historical tensions and rivalries between different countries, which had resulted in two brutal world wars in the first half of the 20th century. Why is it, that European integration, which had been so popular amongst the involved peoples in the 1950s and 1960s, has lost so much attraction now in the 21st century?

Europe exploited: transnational capital’s push for neo-liberal restructuring

The EU had always been a capitalist project. In addition to establishing peace between the different nations, creating closer economic integration in the European Coal and Steel Community in 1952 and the European Economic Community in 1958 was intended to prepare the ground for higher capitalist profits. Nonetheless, this intention had been combined first with a focus on class compromises at the national level, in which capital’s control over production was balanced with a commitment to full employment and an expansive welfare state. Second, there was a commitment to social cohesion across the EU expressed in structural and cohesion funds for less developed member states.

It was from the mid-1980s onwards that this compromise has been increasingly eroded. Against the background of global economic crisis coming out of the 1970s, European integration was revived around the Internal Market programme in 1985. The underlying purpose of this revival was clearly neo-liberal restructuring. Deregulation and liberalisation across the EU removing not only tariff but also non-tariff barriers was supposed to guarantee maximum efficiency and, as a result, maximum profits, which ultimately would also trickle down to people at the bottom of society. This was supported by Economic and Monetary Union, part of the Treaty of Maastricht in 1991, and its focus on price stability, controlled by an independent European Central Bank. Hidden behind neo-liberal rhetoric was, however, a transfer of power from labour to capital. In fact, the focus on price stability and limited fiscal sovereignty of countries within EMU left lowering wages and working conditions as the only option for countries to regain competitiveness in times of recession.

Nevertheless, transnational capital was not satisfied with transforming only the EU. Enlargement towards Central and Eastern Europe offered the unique opportunity of restructuring post-Soviet space along neo-liberal, free market lines. Payments distributed within the existing 15 member states were only partially extended to the new members in the East (Bohle 2006). Ultimately, this policy shift towards neo-liberal restructuring ended in the brutal subjugation of democratic Greece to policies of permanent austerity imposed from the outside. Transnational capital used the Eurozone crisis to shift the power balance further away from labour towards capital. Restructuring measures such as labour market deregulation and privatisation of state assets, impossible in economically good times, were now imposed on Greece and other countries in the European periphery.

The consequence of transnational capital’s neo-liberal restructuring has been dramatic.  Unemployment rates of an average between 8 and 10 per cent across the EU have become the new normal (Eurostat 2016). Inequality between EU member states as well as within countries has dramatically increased (Bonesmo 2012). It is this betrayal of the original idea of European integration by transnational capital, which has put the EU on the brink of collapse. Considering increasing levels of inequality, citizens have lost confidence in the European project.

A clear focus, but ultimately fragmented and weak: the role of the European left

The European left has been aware of this dangerous direction from early on. Already at the first European Social Forum (ESF) in Firenze/Italy in November 2002, activists from all over Europe were clear in their rejection of neo-liberal Europe. Combining this position with demands for more participatory democracy and opposition against the impending war on Iraq, the potentially dramatic implications of continuing free market policies were identified (Bieler and Morton 2004). In the end, however, the ESF process petered out towards the late 2000s without resulting in a broad-based, mass opposition movement against neo-liberal restructuring across the EU. As participants at the Firenze 10+10 meeting in 2012 acknowledged, the European left was fragmented and weak (see Firenze 10+10 – Reflections on the Left in Europe).

Two reasons can be identified for this fragmentation. First, mainstream European trade unions have oscillated between a fundamental, principled opposition to neo-liberal restructuring from within the ESF process and a ‘yes, but’ policy of participating in the policy-making process at the EU and various national levels. At times, they managed to secure important concessions, but the overall neo-liberal direction remained unchecked. Second, political parties of the left, traditionally the second arm of the labour movement, have actually been instrumental in implementing neo-liberal restructuring in the first place. Whether it was third way policies by the New Labour governments of Tony Blair in the UK or the Agenda 2010 by the social democratic-led coalition government under Chancellor Gerhard Schröder in Germany, social democratic parties had become the willing implementers of transnational capital’s agenda.

Unsurprisingly, the European left found it difficult, if not impossible to pursue a clear line of opposition to neo-liberalism, not to think about developing a viable alternative. This failure opened up space for the nationalist right.

Nationalism with a xenophobic base: the attack on integration by the right

Brexit is the clearest expression of the increasing turn to the right by people, who have lost out as a result of neo-liberal European integration. There was also some support for Brexit amongst the British left. Some had naïve illusions about regaining democracy, others dreamt of establishing a socialist economy within one country. The vast majority for Brexit, however, was motivated by anti-immigration arguments (see Brexit and the rise of the nationalist right). With their basic livelihoods threatened, large parts of the British population had become receptive to xenophobic arguments. In a situation of increasing austerity since 2010, foreigners seemed for many to be the perfect scapegoat. It was them, who stole British jobs and undermined the viability of public services including most importantly the National Health Service. The facts that immigration had actually resulted in a positive contribution to the British economy (Economist, 8 Nov 2014) and that the functioning of the National Health Service would be undermined without foreign doctors and nurses (Guardian, 26 January 2014), were brushed aside by an increasingly Europhobic, right-wing press.

Nevertheless, it is not only in the UK, where the xenophobic right has raised its ugly head. The support for Marine Le Pen in France, Geert Wilders in the Netherlands, the Alternative for Germany party in Germany or the almost success of the far-right candidate Norbert Hofer in the presidential elections in Austria in December 2016 indicates that with the European left having failed to offer an attractive alternative to neo-liberal Europe, the right moved in and has occupied the space with its divisive arguments.

What position for the progressive European left in the years ahead?

Considering the impossibility of progressive solutions at the national level and the futility of attempting to transform the existing institutions of the EU, which have been further restructured along the line of neo-liberal authoritarianism, what strategy should the European left pursue? Most importantly, in my view, the focus has to shift from questions of form of European integration over national sovereignty versus further supranational integration to questions over concrete policies, the contents of integration. Key in all these issues is a principled, internationalist perspective. A progressive left position can never be informed by anything else.

Clearly, from a progressive left perspective the position has to be against neo-liberalism and austerity. These policies are the tools of transnational capital to assert its authority over labour. In concrete policy terms, this includes opposition to these new free trade deals based on an expanded free trade agenda such as the Transatlantic Trade and Investment Partnership (TTIP) and the Comprehensive Economic and Trade Agreement (CETA).

In relation to migration and refugee crisis, an internationalist perspective can mean nothing less than international solidarity. From a left perspective, this has to include the free movement of people and open borders. Any compromise with calls for migration controls risks becoming mixed up with nationalist sentiments. For trade unions, more precisely, this implies support for foreign workers to ensure that employers do not abuse them in their attempt to undercut official wage levels and working conditions. As the Norwegian construction workers’ union has declared, ‘we are a union for workers in Norway, not a union for Norwegian workers’!

Moreover, from a progressive left perspective, the emphasis should be on social justice at the workplace and within wider society. This has to involve a strengthening of workers’ and trade union rights at all levels from the company to the industrial sector as well as national and European political decision-making arenas. Additionally, large-scale redistribution of wealth within and between countries is required to combat blatant inequality.

Additionally, a progressive left position has to be solidly anti-war, including opposition to war mongering, which has intensified security risks in Europe in view of heightened tensions with Russia. Increases in military spending, replacing the Trident nuclear weapons system in the UK or moving troops to the border with Russia cannot be policies of the progressive left.

Finally, these questions come back to issues of democratic participation in decision-making. Too many key decisions are taken behind closed doors by a selected few without any input of wider society. All areas of decision-making must be opened up to participatory democracy. In a way this agenda goes back to the ESF at Firenze in 2002. A clear anti-neoliberal economic policy course is combined with participatory democracy and a strong anti-war stance. Especially the latter had been a core component of the initial European project. Forgetting this lesson may be at our own peril.

This post was previously published on Trade Unions and Global Restructuring

Andreas Bieler

Andreas Bieler is Professor of Political Economy at the University of Nottingham and Co-Director of the Centre for the Study of Social and Global Justice (CSSGJ).

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