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Perry Anderson On Brexit, Again

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The EU is based on the idea of laissez-faire. The official website of the European Union itself says on trade:

Free trade among its members was one of the EU’s founding principles, and it is committed to opening up world trade as well.

So it was initially shocking for me in early 2016 why UK leftists were supportive of the UK remaining in the EU. But over time I have come to realise that the left is just fake and is imperialist, manufacturing consent for the ruling class. Academia is so far ahead of the media in manufacturing consent.

Nicholas Kaldor was the most vocal among economists for not joining the EU in the ’70s and I am sure he would have been vocal about leaving the EU had he been alive.

Perry Anderson wrote recently on Brexit in New Left Review and has now written again for London Review Of Books. Not one but three!

Links:

  1. The European Coup,
  2. Ever Closer Union?,
  3. The Breakaway

Now, they’re criticisms of the EU but given that Perry Anderson has a lot of respects in many circles, it could have come much earlier when it was most needed. When personal costs are high, it’s brave. At any rate, better late than never!

45,746 words over three essays! Happy reading.

Link

Perry Anderson On Brexit

The new issue of New Left Review is out and Perry Anderson has a 73-page essay on British state and society.

Some good description of Brexit:

In 2015, Cameron was returned to office without need of the Liberal Democrats, who were decimated at the polls, and in the wake of Labour’s renewed defeat, Corbyn was elected its leader in the first one-person-one-vote election in the party’s history. Within a year came the referendum, called and lost by Cameron on Britain’s membership of the EU.32 His decision to call one, product of long-standing divisions among the Tories, was designed to silence the Eurosceptic wing of his party, in a careless display of class insouciance that with united establishment support—extending from the City to the TUC, not to speak of all-party backing—victory was assured. But as in France and the Netherlands, a popular rebellion against the whole governing class led to the opposite outcome. Two thirds of the working class voted for Leave, a higher proportion than any stratum—including even the best-off—voting for Remain, on a larger turn-out than seen in years. London, beneficiary of the financial bubble and closer to Paris than Manchester by rail, voted heavily for Remain; the abandoned industrial North, hardest-hit by austerity, heavily for Leave. On the left, opinions had divided. Those in favour of Remain argued that the xenophobia of Brexiteers of the right made the EU a lesser evil, those in favour of Leave that departure would be a blow to the neo-liberal oligarchies on both sides of the Channel: each voting negatively against, rather than for, anything. But what would Brexit actually mean for the European Union, or for Ukania in parting with it? So far, all that was clear was that ‘Blairized Britain has taken a hit, as has the Hayekianized EU’ and ‘critics of the neoliberal order have no reason to regret these knocks to it’, against which the entire global establishment had inveighed.

More fine-grained analysis made clear the extent to which the Brexit result, though certainly multi-stranded in motivation, was the expression of a regional and social revolt in the North of England: Leave majorities were concentrated in former strongholds of Labour, now reduced to a hinterland of decayed industries and discarded proletarian households.33 There was hostility to immigrants in this part of the country, as elsewhere in Britain. However, that it was not the primary driver of the outcome could be deduced from Labour’s unexpected recovery in the election of 2017, once Corbyn campaigned on a platform amounting to a rejection of the whole neo-liberal order in place since the 1980s. In the face of a high Tory vote, he not only held most of the North, but swept the youth of the country by margins never previously approached by Labour, in what was now a second popular uprising against the entire British establishment. Yet Corbyn’s position remained tenuous in his own party, whose permanent apparatus and parliamentary delegation remained ferociously opposed to him.34 The small team around him lacked any preparation for government in what would be the predictable conditions of an implacable siege by capital and the media. There were no grounds for euphoria.

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Britain’s liberal market economy—read: secular eversion—generated the two-fold revolt that produced Brexit. The victory of Brexit led to Conservative capture of a majority of the working class. Working-class expectations require concessions from a suddenly altered Conservative regime that Brexit impedes. The desertion of its proletarian base leaves Labour sociologically adrift in the eddies of a protean middle class. Its share of the middle class is attached to Europe, no part of it more passionately than the liberal intelligentsia. Attracted towards Labour by its stance in the cultural war over Europe, the English intelligentsia is alienated from it by what became of its own principal habitat under it. In Scotland, alienation of all classes of society from Labour has given power to a nationalism looking to Europe. Departure from Europe has both inflamed Scottish nationalism and entrapped it. The price of departure, indexed by the EU to political not economic considerations, has left Britain’s rulers answerless politically and, in all probability, the wells of Brexit further poisoned economically. No part of the current configuration is independent of the others. Their nexus is bound to dissolve, in one way or another. When or how is anyone’s guess.

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32 Susan Watkins, ‘Casting Off?’, NLR 100, July–August 2016.

33 Tom Hazeldine, ‘Revolt of the Rustbelt’, NLR 105, May–June 2017.

34 Daniel Finn, ‘Crosscurrents’, NLR 118, July–August 2019.

New Left Review, 125

Thomas Piketty On The Winners Of Globalisation

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Thomas Piketty gets dismissed a lot: from the right-wing since they either think there’s much inequality or that it’s unimportant. From the left, he gets ridiculed for not being a Marxist or even Post-Keynesian/Keynesian enough. Whatever the criticisms, there are some things which he says which are useful and highly important in the current political climate. My view is that he is a bit late to it but some of his analysis adds more light.

Snapshot from a promotional video for Seuil.

In his book Capital And Ideology, he talks of how the dynamics of winners against losers of globalisation creates interesting politics. For example in pages 812-817:

Will the Democratic Party Become the Party of the Winners of Globalization?

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Nevertheless, other factors cast doubt on the long-term viability of a transformation of the Democratic Party into the party of the winners of globalization in all its dimensions: educational as well as patrimonial. First, the presidential debates of 2016 showed the degree to which cultural and ideological differences remain between the Brahmin and merchant elites. Whereas the intellectual elite stressed values of level-headed rationality and cultural openness, which Barack Obama and Hillary Clinton sought to project, business elites favored deal-making ability, cunning, and virility, of which Donald Trump presented himself as the embodiment.16 In other words, the system of multiple elites has not yet breathed its last because at bottom it rests on two different and complementary meritocratic ideologies. Second, the 2016 presidential election showed the risk that any political party runs if it becomes too blatantly identified as the party of the winners of globalization. It then becomes the target of anti-elitist ideologies of all kinds: in the United States in 2016, this allowed Donald Trump to deploy what one might call the nativist merchant ideology against the Democrats. I will come back to this.

Last but not least, I do not believe that this evolution of the Democratic Party is viable in the long run because it does not reflect the egalitarian values of an important part of the Democratic electorate and of the United States as a whole …

  1. Note that the recourse to overtly anti-intellectual and anti-Brahmin leaders like Donald Trump is not limited to the US Republican Party: the European right has gone in a similar direction as shown by the choice of a Silvio Berlusconi in Italy or a Nicolas Sarkozy in France.

and on the EU referendum/Brexit, page 861, Chapter Sixteen, Social Nativism: The Postcolonial Identitarian Trap:

… in all three countries [United Kingdom, United States, and France], the “classist” party systems of the period 1950–1980 gradually gave way in the period 1990–2020 to systems of multiple elites, in which a party of the highly educated (the “Brahmin left”) and a party of the wealthy and highly paid (the “merchant right”) alternated in power. The very end of the period was marked by increasing conflict over the organization of globalization and the European project, pitting the relatively well-off classes, on the whole favorable to continuation of the status quo, against the disadvantaged classes, which are increasingly opposed to the status quo and whose legitimate feelings of abandonment have been cleverly exploited by parties espousing a variety of nationalist and anti-immigrant ideologies.

Link

Jeremy Corbyn On His And Tony Benn’s Positions On The EU And Brexit

Jeremy Corbyn appeard in a recent episode of the podcast Benn Society and at around 13:31 in the audio, he is asked about his and Tony Benn’s position on Brexit since both were opposed to the EU.

Of course, as expected his answer was messed up as he never took a clear position but you can listen to what happened directly from him and how it cost Labout the election.

Image credit: Jeremy Corbyn on Twitter

Tony Benn On The EU

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The Euro Area’s response to the covid-19 crisis is austere. This might lead to more dissatisfaction with the European Union project as many are predicting.

Yanis Varoufakis has been more critical of the Euro Area and the European Union in general in recent times, although he says he is in the team which wants to reform the EU from within. In a recent interview with Unherd, he makes it clear why the UK Labour lost the recent election: the push for a second referendum wasn’t liked by the voters and vote was a backlash against them.

Anyway I found a great clip from Tony Benn, the great leader of Labour, and it’s clear how the EU was hated by the left-wing but that it’s different now, unfortunately.

Tony Benn, in Parliament, 1990 (53:00 in the full video, clipped below):

Is the Prime Minister aware that what we are really discussing is not economic management, but the whole future of relations between this country and Europe? This issue is not best expressed in 19th-century patriotic language or in emotive language about which design is on the currency. The real question is whether, when the British people vote in a general election, they will be able to change the policies of the previous Government. It is already a fact, as the House knows full well, that whatever Government are in power, our agricultural policy is controlled from Brussels, our trade policy is controlled from Brussels and our industrial policy is controlled from Brussels. If we go into EMU, our financial policy will also be controlled. It is a democratic argument, not a nationalistic argument.

However, given that the right hon. Lady is a member of the Government who took us into the European Community without consulting the British people, given that she was Prime Minister in the Government who agreed to the Single European Act without consulting the British people, and given that she has now agreed to joining the exchange rate mechanism without consulting the British people, we find it hard to believe that she is really intent on preserving democracy rather than gaining political advantage by waving some national argument around on the eve of a general election. That is why we do not trust her judgment on the matter.

click to view the clip

There are many clips of Tony Benn on the EU on YouTube, but this is my favourite.

Link

Glenn Greenwald On Red Scare

Glenn Greenwald appears in one the recent episodes on the podcast Red Scare.

He talks of various things politics especially on why Bernie Sanders lost and also Jeremy Corbyn.

This at 1:10:00 caught my attention:

Everyone knew he was in favour of Brexit, like everyone knows he hates the EU but he felt like in order to just like worm his way through the Labour party kind of Blairites, he had to pretend against Brexit and be a remainer when everyone knew he wasn’t, so it was like this kind of like complete draining of his vibrancy and passion being forced into this box where he wasn’t comfortable.

Link

BadMouse On How The Left Abandoned Opposing The EU

BadMouse, the vlogger on the EU and Brexit:

The right has been a stickler when it comes to appropriating leftist talking points, as I have spoken numerous times now. The EU used to be lot more of a conservative tradition opposed by many factions of the left including, of course, the late Tony Benn. But after sections of the right-wing discourse took it by their shoulders, all the left could seem in response was to go, “No! EU good”.

The EU is an undemocratic monolithic entity that controls large hegemony over the continent. This is something the left has always been against and now we seem to have all been been shovelled into the pro-EU corner just to own the right is baffling. How dare they! How dare we allow them to take control of this narrative, on the topic of narratives.

Anthony Thirlwall On Nicholas Kaldor On Joining The European Union

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There’s a new book, The Elgar Companion To John Maynard Keynes, edited by  Robert W. Dimand, Harald Hagemann. Chapter 76 titled Nicholas Kaldor is written by Anthony Thirlwall.

Thirlwall reminds us of Kaldor’s dislike to enter the common market in the 70s:

The Labour Party lost power in 1970 and Kaldor had more time to campaign on two main public issues which concerned him greatly. The first was the acceptance by economists and policy-makers of the doctrine of monetarism which had spread with the virulence of a plague from the University of Chicago under the influence of Milton Friedman to infect policy thinking at the highest level in the UK. The second concerned the UK’s entry into the Common Market (now the European Union). With regard to monetarism, Kaldor led the intellectual assault worldwide against the monetarist view that inflation is always and everywhere a monetary phenomenon in a causal sense caused by excessive government expenditure financed by money creation. On the contrary, argued Kaldor, because money consists largely of credit, and credit only comes into existence if it is demanded, money is endogenous to an economy not causal in the determination of output and prices. The major cause of inflation, at least in mature industrial countries, is rising wages and other costs. Kaldor could find no evidence in the UK. or across countries, of any relationship between the size of countries’ budget deficits and measures of broad money (Kaldor 1980c). Kaldor lost the battle against monetarism in the UK, but won the war because the doctrine of monetarism is now dead.

On the issue of the UK joining the Common Market. Kaldor was highly sceptical of the alleged dynamic benefits stemming from a larger market for the export of goods and services. He argued that because imports are likely to grow faster than exports, as trade barriers come down, the UK would need to deflate the economy to preserve balance of payments equilibrium, and this would slow growth. In addition to this, the budgetary contribution would be huge, the price of food would rise leading to wage increases and Britain would be letting down the Commonwealth countries which had a preferential access to the UK market. The vote in 1975 against joining the Common Market was lost, but Kaldor appears to have been correct in his predictions. The dynamic benefits of having become a member of the European Union are nowhere to be seen. If anything, productivity growth has been slower post-1975 than pre-1975 (although other factors have also been at work).

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REFERENCES

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Kaldor, N (1980c), Memorandum of Evidence on Monetary Policy submitted to the House of Commons Select Committee on the Treasury and the Civil Service, 17 July, London: HMSO.

…

Nicholas Kaldor, picture from Cambridge Journal Of Economics

Graham Gudgin On Exiting The EU

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Graham Gudgin has two recent fine articles on leaving the EU:

The Treaty Of Rome And Balanced Trade

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Policy Research in Macroeconomics (PRIME)’s blog Prime Economics reminds us of the Treaty of Rome, to establish a European Economic Community, first signed in 1957 which has a Chapter on Balance of Payments:

CHAPTER 2

BALANCE OF PAYMENTS

ARTICLE 104

Each Member State shall pursue the economic policy needed to ensure the equilibrium of its overall balance of payments and to maintain confidence in its currency, while taking care to ensure a high level of employment and a stable level of prices.

ARTICLE 105

  1. In order to facilitate attainment of the objectives set out in Article 104, Member States shall co-ordinate their economic policies. They shall for this purpose provide for co-operation between their appropriate administrative departments and between their central banks. The Commission shall submit to the Council recommendations on how to achieve such co-operation.
  2. In order to promote co-ordination of the policies of Member States in the monetary field to the full extent needed for the functioning of the common market, a Monetary Committee with advisory status is hereby set up. It shall have the following tasks:
    – to keep under review the monetary and financial situation of the Member States and of the Community and the general payments system of the Member States and to report regularly thereon to the Council and to the Commission;
    – to deliver opinions at the request of the Council or of the Commission or on its own initiative, for submission to these institutions.

The Member States and the Commission shall each appoint two members of the Monetary Committee.

I have emphasized many times in my blog that Euro Area balance of payments and international investment position imbalances are quite important for the Euro Area. Even before I started writing this blog, I had stressed before anyone else (on other Post-Keynesian blogs) that the imbalances are large and quite important in understanding the crisis.

Of course, imbalances can be corrected by deflating demand and output as has been the case in the Euro Area since the start of the crisis by policy makers. But it’s good to know that the founders of European integration thought of coordinating policies, which implies their policies would have been expansionary. Anyway, had the original ideas not been overthrown, the Euro Area would also have had a central government. Unfortunately neoliberalism became popular in the 1980s and this led to the Maastricht Treaty which forgot the original intentions of the founders.

The Treaty’s opening also has this important line:

RECOGNISING that the removal of existing obstacles calls for concerted action in order to guarantee steady expansion, balanced trade and fair competition

I should mention however that the Euro Area has this thing called the Macroeconomic Imbalance Procedure which tries to address the issue and even thinks of current account surpluses in the balance of payments as an imbalance, but it is still far away from doing anything about it, such as a coordinated fiscal policy expansion.