Readings — From the October 2019 issue

Left of Europe

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From an interview with Neil Davidson published in the Summer 2019 issue of New Politics. Davidson teaches at the University of Glasgow. His most recent book, We Cannot Escape History, was published by Haymarket Books in 2015. The European Union has given the United Kingdom until October 31 to reach a Brexit agreement in Parliament.

“the european union is an imperial power”

ashley smith: A lot of people, even on the left, think the European Union is progressive. What was it created to do?

neil davidson: The E.U. has developed over many decades since the end of World War II. It was set up for four reasons: First, France wanted to avoid another war with Germany—to establish rules that would separate economic competition from geopolitical and military competition. Second, the United States wanted the E.U. established as a political and economic complement to the NATO military alliance. It was part of Washington’s Cold War imperial project. Third, the E.U. was designed to avoid protectionism within Europe. So, from the very beginning, free trade and globalization were immanent dynamics within the E.U. And fourth, the E.U. took shape during the postwar boom—the greatest boom in capitalist history—when capital needed outlets for investment beyond the boundaries of individual states, at a time when decolonization meant that this was no longer possible across the Global South in the way it had been before 1945. The E.U. provided a mechanism for that to take place within Western Europe itself.

Given the illusions many on the left have about the E.U., it’s ironic that its structure corresponds quite closely to the model of “interstate federalism” devised by the economist Friedrich A. Hayek in 1939. Hayek, in many ways the intellectual forerunner of neoliberalism, proposed that economic activity in a federal Europe should be governed by a set of nonnegotiable rules presided over by a group of unelected bureaucrats, without any elected members of government and irrational voters getting in the way. That’s how the E.U. is structured. Its least democratic institutions—such as the European Commission, the European Council, the European Global Central Bank, and the European Court of Justice—have the most power, while those that are at least nomi­nally democratic—like the European Parliament—have the least. It’s a totally undemocratic institution. It’s more undemocratic than any of the nation-states that compose it, including Britain. It was designed to prevent social democrats from infringing on the logic of capital in Europe.

After the end of the Cold War, the E.U. established a highly unequal set of relations between member states. Germany stands at the top, with France, Britain, and Italy below it and in that order. These states dominate the weaker ones like Greece, Portugal, and all those in Eastern Europe. The global economic crisis exposed these structural inequalities. Germany imposed austerity measures on weaker states, throwing countries such as Greece into depressions.

The E.U. is also a deeply racist formation. Just look at how it bars refugees from entry, leaving them to drown by the thousands in the Mediterranean. And in many ways, especially in its economic relationship with the Global South, it is an imperialist power in its own right—a capitalist institution that’s neither democratic nor progressive.

capitalists vs. state capital

a.s.: What has been the majority viewpoint among the British capitalist class on membership in the E.U.?

n.d.: British capitalists on the whole have always been in favor of the E.U. They saw it as a replacement for their colonies, which they had used as key sites for investment. After they lost them, they turned to the E.U. as a new site for investment and trade. British capital remains in favor of remaining in the E.U.

a.s.: Why then did the Tory Party, the traditional party of capital in Britain, opt for Brexit?

n.d.: The Tory Party is not acting in the interests of British capital in pushing through Brexit. This dereliction of its duty is the result of how ruling-class parties have evolved in the neoliberal era.

Usually capitalist parties at least try to run states in the interests of capital as a whole. They are supposed to come up with a program not in the interests of this or that section of capital. As Adam Smith argues in The Wealth of Nations, at the very dawn of the system, capitalist parties and not capitalists should run the state, because individual capitalists tend to pursue their own selfish interests. They don’t think about capital’s collective interests.

That’s why, as Marx and many others argued, capitalist classes, their parties, and their states tend to be semiautonomous. This changed under neoliberalism in Britain. During former prime minister Margaret Thatcher’s reign, in the 1980s, the Tory Party and a particular section of capital—financial capital—became ever closer, and that began to distort the capacity of the party to represent British capital as a whole.

a.s.: So what are the dynamics behind the push for a new vote on Brexit? What are the class and social forces behind it?

n.d.: The main backers of Remain and a new vote on Brexit are the big capitalists, the professional middle class, and sections of the well-paid working class. Each has different visions of the E.U. The bourgeoisie wants to stay in the E.U. or secure a soft Brexit for their class interests and neoliberal project. They have drawn behind them sections of middle- and working-class people who have illusions of the E.U. as a progressive and anti­racist institution.

Opinion on the left is divided about a new referendum on whether to stay in the E.U. Most people on the radical left think this would be disastrous. It would simply consolidate divisions and open the whole situation to charges from the right of betrayal of the original vote. The left liberal press, like the Guardian, support a new vote and claim that there’s a majority for Remain. That may be true, but if there is, it is only a small majority. If another referendum manages only a narrow reversal, it would be catastrophic. It would not resolve anything and would only deepen the polarization and harden it on each side.

“neoliberalism is played out”

a.s.: How will the fight over Brexit affect the E.U.?

n.d.: The E.U. is of two minds on Brexit. On the one hand, it wants to punish the British to sufficiently scare anyone else away from making an exit of their own. And it is succeeding in this; even right-wing governments and parties, who are mainly opposed to migrants, have dropped plans for leaving because they do not want to suffer Britain’s fate. On the other hand, the E.U. doesn’t want to be so punitive as to force a hard, no-deal Brexit that would affect its economies. So it is trying to get Britain to accept a “Norway Plus” deal. It would prefer this result because a no-deal Brexit would cause all sorts of problems, particularly in France, where customs would hold up trucks trying to make deliveries in and out of Britain.

Ironically, the E.U. might miss Britain, which it used to enact right-wing neoliberal policies, particularly during the 1980s. Thatcher would make hard neoliberal demands, the E.U. would concede to her, implement the policies, and then turn around and blame Britain for them. But this was all a smoke screen. In reality, of course, the E.U. wanted these policies all along and used Britain as a Trojan horse to get them implemented.

a.s.: What does all this mean for the neoliberal program of free-trade globalization?

n.d.: Brexit is a sign that neoliberalism is weakening or possibly coming to an end, not just in Europe but around the world. Protectionism is beginning to revive. Some of this is just rhetorical, but the conflict between the United States and China is a harbinger of things to come.

I think we are probably in a transition to a new phase of capitalism. This transition is going to last a long time. Think about the crisis of 1929. It took until after World War II for state capitalism and embedded social democracy to emerge out of the Great Depression. Or think about the transition to neoliberalism itself. The ruling class first articulated this strategy in the late 1970s, but it took a decade or two for it to be consolidated throughout the world system. So it will take some time for a new strategy to replace neoliberalism.

I’m not sure what that new regime of accumulation will be, nor am I clear what range of options capitalism has now. We won’t know the real form of its replacement for a decade or two. At the moment, you’re seeing the ruling classes reviving old strategies from the 1930s, like tariffs.

The process of globalization, which began in 1945 and eventually led to neoliberalism, is now in retreat into regional blocs. The E.U. is one. China is trying to form another. The patterns are just beginning to emerge.

We also may see a movement toward protectionism by the economically less developed states in Europe. They may try to do this without leaving the E.U. through things like nationalization, which can be done at least temporarily. If they try to go further, they will face strong resistance from the top-­tier powers such as Germany and France.

But this is all speculative. The main point is that Brexit is a signal that neoliberalism is played out as a strategy of accumulation. Capitalists and their states will have to come up with an alternative in the coming years.

“it’s not going to happen like 1917 in russia”

a.s.: The radical left seems to have been divided, confused, and unable to affect the crisis over Brexit. Are there any signs of this changing?

n.d.: British politics is highly contradictory right now. On the one hand, there is the unending crisis around Brexit, which, frankly, the radical left has yet to figure out how to intervene in with any degree of coherence and influence. On the other hand, there are signs of hope, especially the Extinction Rebellion, a climate-change protest that closed down the centers of London and Edinburgh for days, with hundreds of young people arrested.

This action has come on the heels of massive protests and school strikes against climate change. These have been some of the biggest since the antiwar protests in the 2000s. But they are different. Young people, largely from outside the traditional parties and organizations of the left, are initiating these demonstrations. That indicates that we’re coming to an end of a particular way of building revolutionary organization and its relationship with social and labor movements. We’ve ­tested that method for half a century but have not managed to succeed. It’s clear that we have to do something different, because it’s not going to happen like 1917 in Russia.

The most interesting thing today is how these new movements are adopting working-class methods of struggle. Just look at how climate activists, the International Women’s Strike, and immigrants’-rights groups have all turned to striking as the way to advance their demands. Working-class methods of organizing are developing within the movement but not as a result of initiatives from the unions or left organizations. It’s coming up organically. People are realizing that if you want to have an impact you have to shut down institutions.

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