Free Trade and Socialism part 2 – the UK general election

Thersa May’s call for a general election has been hailed by the ‘Financial Times’ as a smart move that will give her and the pragmatic Tories some room to negotiate a trade deal with the EU that would be opposed by the zealot Brexiteers.  Today’s paper has a column by the chair of the Institute of Directors praising May while calling for some time for business to adjust to Brexit.  The rise in value of the pound after the news is seen as the smartest guys in the room welcoming the election announcement on precisely these grounds.  Whether this works or not is quite another matter and a decisive victory based on making sure Brexit happens is just as likely to strengthen the rabid demands of those clamouring for a hard Brexit as strengthen its more pragmatic supporters.

The election is therefore set to be all about Brexit and trust in May’s ‘leadership’, or rather her Tory arrogance that is sold as no-nonsense competence, seriousness and proficiency, which a certain section of workers still buy into on the basis of the everyday nationalism and class deference fed to them by the media.  However, even the newly moderated claims for Brexit are undeliverable: she says that she wants “a deep and special partnership between a strong and successful European Union and a United Kingdom that is free to chart its own way in the world”.

The relationship after Brexit can’t be “as deep and special” as the current one so it’s a loss on that one, and the UK will not be “free to chart its own way in the world” no matter how hard it fantasises.  In an issue of the same pink paper last week (and also today) its readers learn that the EU are about to freeze-out British companies’ participation in the European space programme and other EU contracts and funding.  It sounds much better to the ears of Brexiteers when they threaten to just pull the plug and leave without a deal but not quite so comforting when it is reported that the EU bureaucracy is drawing up plans to do exactly the same.

It was also reported in the FT that yet another Minister was visiting India trying to sell it something; Sir Michael Fallon being the empty-handed messenger this time.  The paper reported that ‘military experts say it is a sign of how the UK has been left behind. “If you look at the main four or five players in India, the UK is not there at this point in time”, and It reports that British arms exports fell from £966m in 2010 to £34m in 2015.

So instead of selling arms, Britain now wants to sell India its “arms procurement expertise” because the British might “help them decide what they need.”   The same (or perhaps different) British official thinks reminding the Indians that “the Indian army was created from the British army” and “we share . . an overall ethos” is good sales patter.  This ‘expertise’, the Indians have pointed out, includes ordering two aircraft carriers “that are seven years late . . . (and) are running massively over budget”, and this is without also considering that other problem arising in this British procurement exercise – ordering another aircraft carrier without aircraft for it to carry.

So, Britain is not going to find it easy to chart its own way in the world”; in fact it’s going to find it so hard it’s going to be charting not its own but other, bigger player’s ways in the world, especially as everyone knows, the US way.

Even thinking from first principles – how can you make your “own way” with trade?  Surely you need someone to trade with, someone who will want some say on the rules that govern it; someone who is very likely to be bigger and more powerful than Britain, or will have joined a trading arrangement that makes them bigger and more powerful.  A common strategy – except now for the Brits!

In other words, even if the Financial Times and the money men were correct in the short term, which generally is how long they think about, that May will minimise the impact of Brexit, Britain is going to be worse off.  As I have said before, the threats of a deregulated UK after Brexit are an acknowledgement that the Tory way of attempting to pay the price of Brexit will be to deliver the bill to the working class.  This sugar coats the Brexit pill for business but there will be no sugar coating the poison for workers.

In my last post I argued against the view that the question of trade was one that socialists could not take a side on; or that it ‘depended’ on something else and was therefore perhaps of secondary importance.  In my exchange of views on Facebook set out in that post I said that something could be learned from what Karl Marx thought of free trade.  Then at least, we may have some clue as to what ‘depends’ actually depends on.  Marx obviously thought it was an important issue, just as it is now through the issue of Brexit, and he had a clear position on it.  But I will look at this in the next post.

It is important to understand first that Brexit is bad for trade and will therefore indirectly be bad for workers.  Many workers see the link much more directly – car workers hope that the cars they build can be exported easily into the rest of Europe; university staff seek maintenance of EU grants for their research work; airline staff hope the company retains its base in the UK; farmers hope that they continue to get subsidies; finance workers hope their firms don’t up sticks to Paris or Frankfurt or Brussels or wherever; the list is a very long one.

Because any deal can only be worse and the only thing worse than a bad deal is no deal, the more far-sighted Tories either oppose Brexit or seek a ‘soft’ one.  It is these people that the markets and the ‘Financial Times’ editor and commentators hope will come to the rescue.  Having backed the Tories in the last election, even though it was only they who could deliver them the disaster of Brexit, these people still cling to them again, even while the Tories swear to god that they will deliver it no matter what.  But even with the sugar-coated promise of deregulation, the Tories are going to dash their hopes – the Tories have already promised not to give them the single market or a customs union.  The continuing support of business for the Tories is yet more evidence of their wilful ideological blindness.

Their logic is completely without merit – if the balance of power lies with the EU and the pressure of time is all on Britain, this will very quickly become apparent, in fact it already has as May’s changed tone once article 50 was triggered has shown. May now talks not only the nonsense quoted above but also about a transitional deal, “controlling” immigration not lowering it, perhaps through voluntarily allowing cheap exploitable labour into agriculture when it is needed and then chucking it out afterwards.  Or allowing entry to skilled workers for companies that lobby for it.  Payments can still be made to the EU for some sort of trade access and EU courts will still have ultimate say.  To which it might be asked – what’s the point of leaving, although the Tories think that, with an election victory, answering such a question can at least be postponed.  After all, the May strategy in this election appears to be to say as little as possible.  And there’s a logic to this as well – the same logic.

The Tories cannot promise a ‘soft’ Brexit, or the detail of what it might involve, or even a transitional deal, which has become the favoured option of some business opinion who hope it might morph into something permanent that isn’t hard-on Brexit.  The Tories can’t do these things because those are decisions that are not theirs to take.

The EU will decide whether after less than two years the UK can get lost “making its own way”.  The EU will decide whether there is a transitional deal and what it will look like.  Making any sort of promise during an election would simply invite EU leaders to point out what the real situation is – ‘you say it best when you say nothing at all’ is therefore the only sensible thing to do.  It might make you look increasingly stupid during an election campaign but May is relying on an existing poll lead and a fully undeserved reputation for competence.  And, of course, a compliant media.  How could anyone believe that only she can be trusted to be a strong negotiator with the EU when she’s even afraid to negotiate her way round a TV studio in a leaders’ debate?

If a ‘soft’ Brexit does not exist for the Tories it cannot exist for Jeremy Corbyn either.  The defence of workers’ interests that is the Labour Party’s platform cannot be implemented while leaving the EU.  For those who believe that socialism arises simply from revolution against capitalism and that the EU is a neoliberal conspiracy this is incomprehensible. It is nevertheless true because socialism will be built upon the foundations of the productive forces of capitalism and from transforming its social relations, not merely overturning them.

The more Corbyn stands up for the living standards and rights of working people the more this will conflict with a Brexit agenda, although again and again he turns away from this truth and damages his own case and the prospects for winning over the Remain voters.  The election will truly have revealed the bankruptcy of the bourgeois electoral process if May can keep her mouth shut about what Brexit actually entails and Corbyn can maintain that he will defend workers’ rights without threatening Brexit.

As for the prospects for the election itself; at the start of the campaign the press is clear that Labour is finished.  It must become clear quickly that this is not the case and even by doing this Labour will have registered a success.  Simply by standing up it can continue to fight and by continuing to stand prove the pundits wrong.  Tory arrogance can then first be halted, then challenged, and then thrown back in their faces.  The worst sort of defeat is when you don’t fight, and if you fight there’s always the possibility to win.

to be contd.

Free Trade and Socialism part 1

My last post on the potential effects of Brexit on Ireland or even worse, the effects of the Irish State leaving the EU, led to the following exchange of views on Facebook:

PF:  This piece could have been written by a not especially radical employee of whatever the Industrial Development Authority is now called. …… workers will suffer because their main trading partner is leaving the neo-liberal EU? At least the Sticky 1977(?) plan for Southern capitalism had the merit of claiming a class analysis.

Sráid Marx:  But is it true?

PF:  Depends!

Sráid Marx:  On what?

PF:  It depends on the standpoint. Our man on the Dublin omnibus views everything through the prism of Brexit. Right at the end he says the Brit ruling class is undermining itself. There is, no doubt an ongoing debate, with most of big capital (and their media) opposing BREXIT (the Economist looks forward to it being overturned) while more ‘domestic’ capital – about 90% of firms – in the main support it. Not much to do with intelligence; much more to do with class interests.

As far as the interests of workers go, he suggests that wages will fall, with the implication that if Britain remained, they wouldn’t. Real wages in Britain have fallen over the past period, well before the Referendum. So this is a bit of a dodgy argument anyway.

For the rest of the piece he speculates on tariffs, foreign direct investment, the benefits of WTO rules, migration between the 26 Counties and the UK, the value of trade between the EU, Britain and the Republic and finishes with a swipe at Corbyn, the most left wing leader of the LP – EVER.

All of the economic analysis can be seen in any broadsheet newspaper any day – but the main point is not its orthodoxy. That surely is a problem from someone whose tag line contains the word Marx? The problem is this: everything is viewed through the apparent stupidity of Brexit. He takes sides in an argument between two factions of the capitalist class and berates them for not really understanding their own interests. What’s Marxist about that?

Where does this orthodox analysis lead? To an attack on Corbyn. For not saving the British capitalist class from its apparent Brexit folly by mobilising more Labour voters to support Remain? The political conclusion is even more bizarre. Presumably, the LP should ditch Corbyn and would soar to electoral victory on the promise of the heavenly ‘single market’. Since when has ‘free trade’ been a socialist demand?

If he really wants to see where this leads he should look to ‘Open Labour’, the recent creation of O’Jones and others. In order to advance their ‘Left’ coup against Corbyn, they must shut out the Left. Jones’ diatribes against Stop the War and Stand Up to Racism are designed precisely for this purpose. If the coup from the ‘Left’ succeeds (Momentum, itself divided, has been far too timid in fighting the Right in the apparatus) the Corbyn project is a goner and we’ll be back to a soft left leadership kowtowing to the well funded Blairite right. And they’ll have the right line on Brexit, immigration controls and so on. But they’ll still lose – at least while workers remember what they were like.

Sráid Marx:  So it depends on your standpoint, does it? So barriers to trading the goods and services produced by workers won’t have any effect – is that what you are saying? Less investment won’t have any effect on employment?

In my series of posts on Europe I advance an argument that I think allows workers to take a standpoint independent of the small capital that seems mainly to want out of the EU and the big capital that doesn’t. As for the socialist standpoint on free trade, if you simply google ‘Marx and free trade’ you should get an answer to ponder.

And please don’t put words in my mouth about wanting Corbyn replaced by some soft left alternative that would inevitably pave the way for a Blairite. Some more familiarity with my blog would quickly disabuse you of that speculation. And finally, there really shouldn’t be a debate about whether Brexit will lower wages because it is already happening.

KH:  What about CETA and the Fiscal Compact – that effectively wipes out possibilities of reflation/deflation as well as ability to control inflation rates. It is a completely symbolic gesture if you cannot mandate your own Central Bank to carry out your own sovereign economic and monetary policies, which instead, will be set out entirely in the interests of German rather than Scottish economy.

Only a fool would voluntarily give away national control over fiscal and monetary policy. Six years of EU austerity policies and three structural adjustment programs brokered in a bid to save a massively dysfunctional currency as well as corporate and financial interests have probably guaranteed the election of at least two neo-fascist governments in the next few years.

Wages have been lowered to such an extent in the EU since 2008 that you are happy to accept the election of Wilders et al due entirely to the austerity policies imposed by your beloved ECB.

PF: “So barriers to trading the goods and services produced by workers won’t have any effect – is that what you are saying?” Nation states, including the South of Ireland, used such barriers to protect the economy up to about 1960’s. And the majority of the 26 County working class supported Fianna Fail for exactly the same reason. It only ended when the US ruling class decided post-War that they wanted to muscle in on the pickings of the British Empire (Commonwealth). ‘Free trade’ (one of the reasons the Democrats lost and the AFL-CIO sit on Trump’s Economic Advisory Council) is no more socialist than protectionism.

*           *          *

There are a number of obiter dicta that could be made about the objections to my post on Brexit and Ireland including exhibition of a left-wing variant of ‘Gove’s disease’; that is an aversion to ‘experts’; a reincarnation of that other pathology – ‘project fear’ – which seemed to be a Pavlovian aversion to some variant of capitalist arguments, but in this particular case capitalist arguments you don’t have a convincing response to.

The left-wing Gove’s disease consists of an ability to dismiss argument or evidence that comes from bourgeois experts or those who place some reliance on the argument and evidence they present because:

  1. You don’t like them,
  2. No one on the left should employ them and
  3. You don’t have answer to them (or not one that addresses the point).

Unfortunately, workers are often impressed, confused or frustrated by these arguments and only rarely simply dismiss them, as we have been invited to do.  Socialists therefore need to understand and respond to them, extracting what is of value from them for the benefit of our class.  By analogy – much like Marx did with all those hours in the British library, where he didn’t spend his time simply reading socialist writers.

We have, then, an allegation of bourgeois ‘orthodoxy’ and then an assertion that what we need is “reflation as well as ability to control inflation rates.”  You must be able to “mandate your own Central Bank to carry out your own sovereign economic and monetary policies, which instead, will be set out entirely in the interests of German rather than Scottish economy.”

So, what we have is not an alternative to some sort of bourgeois orthodoxy but a different sort of bourgeois orthodoxy, one that is false.  It is orthodox because what it asserts is state (‘national’) intervention – presumably on behalf of workers – which is nothing to do with socialism since socialism is based on the power of the working class, including the power to destroy and supplant the capitalist state.

The only assumption that could make the demand for different orthodox capitalist economic policies legitimate is that some capitalist policies provide better conditions upon which workers can fight for their own interests, although never forgetting that the bourgeois alternative is ultimately to the benefit of capitalist system and cannot suspend forever its contradictions.

But I am criticised for wanting to take one side in an inter-capitalist dispute (a charge I reject) while it is asserted that socialists should fight for “your own sovereign economic and monetary policies, which instead [in the EU], will be set out entirely in the interests of German rather than Scottish economy”.  Now this really is taking sides on an inter-capitalist dispute.

It is false because, if the capitalist state could, through monetary policy, control the price of money capital, it would equally be able to control the price of all commodities, and why would this not include the value of labour power?  Being able to do so, why could it not plan the operation of the capitalist system through suitable prices so that it could avoid austerity, allow ‘sovereign’ control in the interest of ‘our’ economy (Scottish, Irish, insert country of choice) and in doing so provide well-paid and secure employment, welfare and public services for everyone?

But these are digressions.  The main point is that the original post argued that the disruption to existing free trade arrangements etc. would be bad for the working class and that there is a socialist position on this development.

So what then is the socialist position on free trade and is it one of ‘depends’?

Contd.