Money at the centre of the EU. Photo: Creative Commons Money at the centre of the EU. Photo: Creative Commons

The gathering crisis in European Union should make it clear the EU provides no haven from racism or austerity

The European Union is in crisis. That’s not just because of Brexit. Brexit is a symptom of problems with the European Union’s own structures.

We are beginning to see ever more countries bedevilled with major problems in the European Union. That cannot be an accident, it must point to a common set of causes.

Bad headlines

Let’s just run through some recent headlines related to the EU to illustrate its problems.

Europe’s South is still in trouble. Italy has a new, Eurosceptic government, which is already challenging EU migration policies. It refuses to accept new migrants.

Meanwhile, Spain’s long unstable centre-right minority government collapsed, to be replaced by a new unstable centre-left minority government.

How to deal with Catalonia’s declaration of independence remains a problem for Madrid and Brussels. The EU has largely stood by as Madrid crushed Catalonia’s (long-planned) referendum. The episode puts the EU at odds with its claim to be a bastion of democracy.

Meanwhile, the EU is entering a tariff and trade war with the increasingly protectionist US. This is a time of fledgling economic recovery following a decade of stagnation. Corporate debt levels remain high, though, suggesting an end to the long recession is nowhere in sight.

On top of all this, news has emerged of a major conflict in the core of the EU. The German government could implode in a row over migration. Interior Minister Horst Seehofer is seeking a more intransigent anti-immigrant policy from Chancellor Angela Merkel.

Germany’s ruling coalition just managed to survive a bad performance at the polls last year, in which the anti-immigrant AFD party became the third largest party in Germany’s parliament. That result put Merkel on notice and made any reform of the EU likely to be dominated by the right.

Almost two thirds of Germans disagree with Merkel. There is speculation that Seehofer could bring down the government, and seek what is being called a ‘coalition of the willing’ led by Germany and the right wing governments of Italy and Austria to reform the EU’s migration rules.

That would likely draw support from many existing right wing governments in Central and Eastern Europe, primarily Poland, the Czech Republic and Hungary. It may seem that this is the kind of European Union that the Daily Mail may reconsider its stance on – which may be why a ‘Remainer’ has come to head that right wing paper.

But it is surely not the kind of European Union anyone progressive wants to be part of, let alone associated with. And that is if the European Union as such survives the fallout from the deepening crisis it finds itself in.

The deeper roots of the crisis

The apparent rightward drift in, and crisis of, the EU is of course not an isolated trend. The US, Russia and China are now headed by authoritarian figures with a penchant for neoliberal economics.

Clearly, the shift towards neoliberal globalisation has had world-wide effects. Responding to falling profit rates following several decades of growth after the Second World War, Western countries responded by a wholesale attack on unions and the welfare state.

While wages have since remained stagnant across the developed world for decades, we have seen finance capital unchained in search of profits and often at the expense of real production.

The credit bonanza survived as long as the developing countries invested their profits in the first world, especially the US.

And this continued for longer than most could have predicted, as the collapse of the West’s main competitor – the Soviet bloc – added to the sensation that no alternative existed.

Politics across the world began to be emptied of ideas and became a competition between two or three management teams vying to be the most adept at running neoliberal capitalism.

The so-called Washington Consensus in economics was therefore accompanied by the development of what Tariq Ali has called the ‘extreme centre’ in politics.

But this permanent debt economy could only go on for so long: until there was a bust and someone had to pay. That bust came in 2007-8, and we have been living with the results.

Stagnation and austerity have characterised most parts of the world, as publics have been forced to pay for the crisis, especially the crisis of the American, British, French and German banks.

Has the establishment lost control?

While people had for decades endured longer working times, less secure employment and tougher managerial styles, now they were forced to start giving up their living standards and drown further in debt.

It is no accident that people around the world are deserting the ‘extreme centre’ in droves and accepting ‘anti-establishment’ narratives.

There is nothing preordained about these sentiments going to the right and we have universally seen polarisation across the board, as argued by Chris Nineham in his book How the Establishment Lost Control.

Sadly, in many places, it is marginalised parts of the establishment that have successfully – but falsely – represented themselves as figures of change.

Their current success is in part down to their ability to marshal resources not available to the left. Despite this, there have been concerted efforts by the left in different parts of Europe to channel popular anger. So far these failed to break through, or in various cases, most notably Greece in 2015, they have capitulated to neoliberalism. In Britain of course the game is very much on. In many places left setbacks have opened the space for at least temporary surges on the part of the right.

The latter’s agenda has been to restructure ruling class power around stronger national states, that are able to better protect domestic business interests and channel popular discontent against outsiders, in order to restore the ability of the ruling class to manage increasingly restive populations. The main target of this are ruined middle classes, but it is undeniable that sections of the working class have also been targeted.

This is a kind of pre-emptive soft coup by the elites to forestall the crisis, after soft coups by more establishment bodies like the Monti government in Italy or the Troika (the European Commission, the European Bank and the International Monetary Fund) in Greece failed.

Can the European Union be reformed?

While the crisis of the EU and its rightward drift are not unique, there is something deeper about them than the crises of other states.

The EU is a complex body involving many layers of governance and a major democratic deficit. It is ruled by the Council of Ministers, run by an opaque European Commission and crowned by a toothless European Parliament.

This means that major changes to Treaties signed by states need consensus to change. It is difficult to imagine that the clock can be turned back of decades of neoliberal economic institutions, which came on top of an already very undemocratic set-up.

Indeed, rather than establishing itself as a social-democratic alternative to the US and the USSR in the Cold War, as proponents of a ‘Social Europe’ like Jacques Delors might have liked, the EU in fact accepted neoliberalism in the Maastricht Treaty (1992) and cemented this in the Lisbon Treaty (2007).

Worse, the EU has a common currency, but no common fiscal policy, making it difficult for it to react to shocks. The Euro has also had the effect of helping more productive economies who can easily outcompete less productive economies that have few policy options to defend themselves.

This has strengthened a core-periphery dynamic, with the likes of Germany and the Netherlands dominating and southern Europe falling behind and relying on eternal debt to survive. It becomes difficult to imagine these countries giving up privileges their businesses enjoy easily, and therefore it becomes difficult to see what material interests might bring about progressive change.

Any notion that a social democratic reworking of the EU could occur is further discredited when surveying the state of the social democratic left across the continent. Some kind of soft left remains strong in the countries on the extreme fringes of Europe, like the Iberian Peninsula and Greece, while it has dramatically weakened in many core countries like Italy, France and Germany. In the countries of the former Soviet bloc, the left is almost completely discredited, with right wing parties dominating most of the former East. No hope of a workable reformist centre left coalition winning across the board is on the horizon.

What way forward for the radical left?

Where the left has bucked the trend is where it has refused to back the status quo. Corbyn’s Labour is the only social democratic party in Western Europe that has seen a dramatic increase in its vote.

This has to be associated with Corbyn’s radical image and his refusal to back the Remain cause. Unfortunately, many Labour MPs appear not to understand this and keep obstructing Corbyn’s radical message.

However, the left can only win back support if it is resolutely takes on the establishment. The task will not be an easy one across the continent but radical left forces arguing for a Plan B for Europe are doing better than the left that has championed the cause of the European Union.

The idea that the left should refuse to respect the Treaties of the EU and in fact work in contravention of them would almost certainly lead to punishment and ejection of countries with radical left governments – if these even stuck to their programme.

As was evident in Syriza’s rise and fall as a radical left in Greece, policies that try to challenge the neoliberal consensus – from curbing the power of finance capital, to radically redistributing power and wealth in society – will meet with the full wrath of the world’s rich and powerful.

Labour will face a similar situation if it takes power and it is already clear that many sections of the Parliamentary Labour Party will rather do a deal with the Tories than allow a Corbyn government to succeed.

This is why it is important to construct popular movements with the working class at their centre which are prepared to go beyond the structures of the establishment. That has to mean being ready to break with the Parliamentary Labour Party and challenge state power – but also to withdraw from the EU on a popular programme of a People’s Brexit.

Such a move would encourage radical movements to coordinate their activities on a global basis, and point to domestic restructuring as a transition phase towards a truly global and truly new deal in which it would not just be consumption but also production that would be socialised.

And that would require challenging the power of the ruling class, its ownership and control over key economic assets, and combating its many institutions that reproduce its ideas and instil fear in the population – above all the state.

Vladimir Unkovski-Korica

Vladimir Unkovski-Korica is a member of Marks21 in Serbia and a supporter of Counterfire. He is on the editorial board of LeftEast and teaches at the University of Glasgow.