european union

Portugal and austerity: what European model?

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In today’s blog post, Roberto Falanga and Simone Tulumello describe the trajectory of Portuguese austerity politics, from the post-crash bailout. Portugal is often held up as an example of anti-austerity politics, especially by the left in other countries. Roberto and Simone argue while it is correct that the left coalition is reverting austerity policies, it does so under contradictory conditions that call for a broader rethinking of the European model if the approach taken until now is to be sustainable.

The Memorandum of Understanding for the 3-year economic adjustment programme in Portugal was signed in May 2011 under the supervision of the International Monetary Fund, European Commission, and European Central Bank (the so-called Troika). The bailout package of 78€ million provided to the country was agreed by the three mainstream parties – the majority made up of the Social Democratic and Popular parties, and the Socialist party in the minority – to consolidate domestic finances and improve international competitiveness against the increasing vulnerability of the country to the effects of the global crisis.

Preceded by preliminary rounds of austerity (the Programmes of Stability and Growth, Programas de Estabilidade e Crescimento) imposed by the European Union to the socialist government led by José Socrates, the intervention of the Troika between 2011 and 2014 imposed significant pro-cyclical fiscal consolidation measures (like in Ireland, Greece, Cyprus, and Spain, where similar Memoranda were signed in the same period). At the local level, for instance, fiscal retrenchment entailed a reduction of administrative units, state grants (about 60% of local revenue), municipal staff, municipally-owned enterprises, while decreasing local debt and enhancing new mechanisms for risk management control, reporting and monitoring (Teles, 2016).

Against the negative effects of the austerity measures on social, economic and political life (economic recession, increasing unemployment, impoverishment of large sectors of civil society, emigration of young and high-skill generation, private housing speculation, etc.), protests and social mobilisation erupted in the peak of the crisis between 2011 and 2012. Labour unions and political parties at the end of the left spectrum tended to support movements (e.g. ‘Indignados’, ‘Que se lixe a Troika’, etc.) and civic networks (e.g. the ‘Congresso Democrático das Alternativas’ composed of people from trade unions, left-wing parties, academics and social movements). In this period, public interest over large payroll tax increases – and more broadly austerity measures – grew and key institutional actors like the Constitutional Court directly challenged the government and pushed the suspension of austerity measures, like Labour Code amendments.

Portuguese mobilisation spread after decades of low participation in political life and within a global scenario in motion, with the ‘Arab Spring’ and the Spanish occupations in Madrid rising interest and concern worldwide. This notwithstanding, when compared to countries like Spain and Greece, protests, occupations and strikes in Portugal attracted less public than expected and did not produce new ‘anti-system’ groups. According to Caldas (2012), this was due to an increasing alienation from politics and representatives, perceived as corrupt and dishonest, which exacerbated historical trends of disaffection with political institutions and representatives (De Sousa et al., 2014). Moury and Standring (2017) explain that alienation of grassroots movements and self-organised groups was the result of the government attitude against social partners and professional bodies, placed before austerity as a fait accompli.

The reasons behind the growing mistrust towards the political class, as well as towards protests at occasion perceived as controlled by labour unions and political parties (Observatory for the Quality of Democracy report 2012), should be searched in the way the adjustment programme was implemented. Disaffection in civil society was coupled by discontent among business sectors (for instance, due to the rise of the valued added tax), and within party ranks of both government coalition and opposition. The major mainstream party at the opposition, the Socialist party, decided to stop supporting the government in 2012 by voting against amendments to the 2012 budget and the 2013 budget, in a time when pools on voting intentions gave it an edge over the centre-right coalition (De Giorgi et al., 2015).

Despite the attempts to persuade society on the need of austerity through the TINA (‘There Is No Alternative’) rhetoric and blame shifting communication strategy on previous administrations (Fonseca and Ferreira, 2015), confidence on government dropped-off. Alienation from the political sphere reached the highest abstention rates since 1979 in the 2013 local elections (47.4 %; preceded by 41.9% in 2011 and followed by 44.1% of abstention in 2015 in legislative elections). Noticeably, abstention resulted positively associated to lower socioeconomic resources and educational skills, furthering the exclusion of the most vulnerable groups from public decision (OECD, 2015).

It is worth noting that the blurring borders between institutional and non-institutional spheres have always characterised political life in the country. If compared to neighbouring countries social mobilisation was weaker, this may have been compensated by easier transfer of ideas and instances between movements and parties, as the same actors often played multiple roles. As a result, in contrast to the growth of anti-system groups, like in Spain and Greece, political parties tended to incorporate social claims, taking ahead political strategies that eventually prepared the field for the ‘Geringonça’ to be in power from 2015.

The term Geringonça means something with an unstable structure (and few chances to be durable in time), and is informally used to describe the coalition between the Socialist, the Communist, and the Left Block parties that is currently governing the country. The coalition, emerged from the initial impasse for the formation of the national government after the legislative elections in 2015, has a peculiar character: the left-wing parties do not take part in the government, but form, together with the governing Socialist party, the parliamentary majority. This situation has brought the parliament back into the core of political action, in that every governmental proposal needs to go through the negotiation with the Communist and Left Block parties – and in some cases with the centre-right parties, in the name of ‘large agreements’ and ‘stability’.

Amid the deep recessionary effects of the austerity policies, the dismantling of the welfare regime, the crisis of corporatist traditions and the interruption of secular trends of greater equality and inclusion, the new majority declared its intention to reverse the austerity agenda implemented between 2011 and 2014 – though with significant contradictions. The priority has been restoring the purchasing power of workers and civil servants – for instance, by reversing the tax increases and the extension of the work week from 35 to 40 hours put in place by the previous government. Though some economists and experts have been criticising these measures,[1] 2016 and 2017 have seen a fast economic growth, giving the government the possibility to keep up with the expansionary agenda as well as maintaining good financial fundamentals.[2]

However, some fundamental contradictions persist. On the one hand, the economic growth is based on exportations and, expressively, the boom of tourism, and doubts persist on its sustainability in the long run. On the other hand, amid the Socialist will to not break up with European conditionality, the investment in purchasing power has meant that virtually no action has been put in place so far to revert the dismantling of the welfare state of the previous years – the national health system, housing policy and public transport are possibly the fields where austerity hit the hardest. While ongoing discussions for the 2018 budget seem to signal a renewed attention to the welfare state, particularly in the field of health[3] and housing (a ‘New Generation of Housing Policies is ongoing public discussion), it seems to us that the potential for consolidating a different path to development lies exactly in the engagement with the contradictions we highlighted, which is quite unlikely in absence of a more general rethinking of European institutions and mainstreams.

While many in Europe are pointing at Portugal as the evidence that the austerity (and neoliberal) hegemony may start their path to decline, we believe Portuguese successes and contradictions point toward the need for a deeper questioning of the European model of development.

Roberto Falanga and Simone Tulumello, are Postdoctoral Research Fellows, at the Instituto de Ciências Sociais, Universidade de Lisboa

[1] The Post-Programme of Surveillance initiated in May 2014 in order to monitor economic, fiscal and financial policies in Portugal stress spread weakness in labour market, public administration, and judicial system inter alia. The programme also critically observes the reverse of some previous reforms, as the return to the 35 hours working week in civil service; the increase of public employment via new hiring policies; the reduction of VAT for food at restaurants; backtracking in reforming state-owned enterprises and concessions negatively affecting the capacity to attract foreign direct investment.

[2] The Ministry of Finances, Mario Centeno, has even been included among the potential leaders of the Eurogroup.

[3] See http://expresso.sapo.pt/sociedade/2017-10-14-Orcamento-para-a-saude-aumenta-44.

Austerity Diasporas – Households in Crisis: Austerity, Migration and Family in Portuguese London

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In today’s post Lisa Rodan introduces a series of publications on her ongoing PhD research into how Portuguese migrants understand their lives and experiences in relation to the political and social changes wrought by the 2008 financial crisis and the austerity measures that followed. For the past 12 months Lisa has been carrying out ethnographic interviews with university educated, Portuguese people in their 20s, 30s and early 40s in London, supplemented by time spent in Portugal where she has been lucky to meet some of their families. In a series of posts Lisa will share her initial analysis of some key themes arising from her fieldwork data, which she began to collect in June 2016 just after the Brexit vote. These encounters have ranged from one-off interviews to valued friendships and time spent with each other’s families. The content of the series will be a very close reading of  fieldwork notes in their raw form. Lisa welcomes any input and suggestions from interested parties.

Today’s blog, the first in a four-part series, will focus on social changes in Portugal leading up to the 2011 austerity measures. I will continue next month by reviewing how migration has shaped Portuguese history and what makes this latest wave different. Part three will look at London and how Portuguese migrants exist within it as a changing, global city in a time of European-wide austerity. Finally, I will discuss predictions for life after Brexit and how my research participants view recent positive changes in Portugal in terms of their own futures.

The following blog post is the first in the series on austerity and family – on the theme of “the changing role of the family / state in Portugal”.

“Things were going well, there was so much to do in Portugal, people were positive about their lives, their futures and then the crisis happened.” Carlos, 45

Carlos, 45, Lisbon, teacher turned IT consultant. Cecilia, 26, Vila Real, nurse. Sofia, 35, Porto, scientist[1]. Different worlds and stories but there is one thing they can all agree on- that they are a product of a ‘golden age’ of social and economic expansion in Portugal throughout the 1980s and 90s that no longer exists. These are the children of Europe, making their way in a very different world from the one their parents aspired to on their behalf. This was a world defined by prosperity, with education- via a proliferation of new universities all over the country- at its centre. The graduates of this expanded educational system form the backbone of a new middle class who found themselves with no place in the Portugal during the first decade of the 21st century.

Changing expectations is the key concept here. Values had transformed from the days of the Salazar dictatorship (1926-1974), and in the years following Portugal’s 1986 admission to the EU. Education was the key to an exciting new world where, for the first time, a ‘good life’ was accessible within Portugal, as long as one worked and studied hard for it. A long tradition of migration in search of a better standard of living, albeit through low paying jobs, was being turned on its head in favour of a prosperous future at home.

This new middle class, many of them the children of migrants who had returned to Portugal during the ‘golden years’, saw their expectations for a life different to that of their parents diminish before their eyes when austerity measures crippled the Portuguese economy in 2011. The industries worst hit were represented by thousands of unemployed graduates in nursing, teaching and construction- graduates who would now join the traditionally less educated migrant groups in seeking their fortune elsewhere.

The older ones I’ve spoken to are still angry. They remember what life was like before, although their anger has significantly diminished in the six years since the hardest repercussions of austerity were felt. However, it is the under 40s who have crossed my path more, and they define their experience as fleeing the prospect rather than experience of unemployment or stagnant careers. Expectations have once again changed in the ten years following the financial crash and again and again I am confronted by stoicism, a confidence in their ability as Europeans to find a way around the challenges of Brexit, but most of all a hope for the future rooted in trust in the same educational capital that prompted them to seek a world away from family and friends back home.

These graduates in their 20s and 30s encompass the values of a generation raised with Erasmus exchanges, travel opportunities and an affinity for the English language that, they explain, contrasts them to their parents, whose clinging to job security above all else is alien to what they have been brought up to believe. Nevertheless, the two sets of values are inexorably linked, not just through the obvious affective family bonds but through ongoing support networks. These networks are both financial, allowing young people to undertake internships, language classes or simply the space to save and figure out what to do next, and emotional, communication technology offering an opportunity for transnational connectivity in a way hitherto unexperienced by previous generations of migrants.

But what are the main differences between the EU generation in London and their parents, the children of the dictatorship? The former overwhelmingly present their experience as providing hope, meaning and pride through success (or the potential to succeed) in a career which is both internationally transferable and offers recognition of the individual’s talents. The irony at work here is the root of such hopes in the earlier prosperity wrought by neoliberal expansion which could only temporarily mask the inability of the economic and political framework of periphery countries to support the excesses of global finance and failures of the monetary union. What we are seeing now are the social repercussions of expectations of access to global consumerist comforts and existential fulfilment without the need to migrate. For many, this is now only attainable through planning a future outside Portugal.

Those Portuguese who recall pre-EU days defined by lack of both consumerism and the welfare state claim the younger generation don’t know the truth of how hard life can be and undervalue security. Those who have migrated and remained abroad describe their home country lovingly but as being devoid of opportunities befitting their qualifications and experience- a country mired in a system based on nepotism that undermined ‘EU values’ of efficiency, prosperity and merit. The young people I have spoken to refer to a favours system based on pre-revolution mentalities where contacts, rather than ability, are the key to getting ahead and have led to a country stuck in the past, where aspirational and intelligent young people migrate, leaving the same old names in charge.

Lisa Rodan is a third year PhD student in Social Anthropology at the University of Kent where she is working with three colleagues on an ESRC funded project entitled Household Survival in Crisis: Austerity and Relatedness in Greece and Portugal.

[1] All names have been changed

Democracy vs Sovereignty? Reflections on the Brexit Debate

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27323547984_9ef3a4456a_bIn today’s post Prof. Jonathan Davies argues that the left has no option but to support the triggering of article 50, because the arguments employed against doing so are not credible and cannot presently command any sort of democratic mandate.  The left should instead harness the ‘boomerang effect’ of anti-Trump sentiment in order to build an alternative politics fighting for substantive equality, defending the free movement of labour and opposing the Thatcherite economics of the “single market”.

As Theresa May’s March deadline for triggering Article 50 approaches (this is the EU clause setting Brexit in train), “Remain” forces have been arguing that MPs should vote against it.  They effectively want Parliament to stop the Brexit bandwagon in its tracks. And, when Article 50 is triggered they believe the UK must remain part of the EU “single market”.  I voted “Remain” in the June 2016 referendum. I did so not because I like the EU but because I feared the racist backlash, which followed.  Had I voted “Leave”, I would have had to take my share of the political responsibility for that. Moreover, I share the fears and anxieties among pro-EU friends and colleagues about the rise of racism and nationalism in the UK, the US and parts of Europe. Undoubtedly, these are frightening times. Nevertheless, I believe that Remain perspectives are reckless, if not downright dangerous.  And there are far better political options.

A colleague recently made a memorable comment that attacking institutions on entirely legitimate grounds may have dire consequences, if the assailants cannot control what happens next. Remainers used arguments like this before the Referendum. The one about letting the racist genie out of the bottle convinced me.  Yet those now arguing that Article 50 must not be triggered seem to have forgotten their own rules.

After the Referendum, the pro-EU camp disinterred the constitutional principle of Parliamentary Sovereignty.  This principle holds that no authority can countermand the will of Parliament. The Supreme Court judgment on 24th January 2017 upheld that principle in forcing the government, against its will, to hold a House of Commons vote on whether it should be permitted to trigger Article 50.  MPs in the main English parties are divided, but it appears that with Labour support the government will win the final trigger vote on 8th February.  Jeremy Corbyn’s “three line whip” ordering his MPs to vote for Article 50 has led to a renewed chorus of condemnation for the beleaguered leader, not least from the left remain camp, which wants Labour to follow the principle of Parliamentary Sovereignty and strike down the referendum to save Britain from self-inflicted economic and political catastrophe.  This position is justified by the assertion of expert privilege in combination with consequentialist logics. The rationale is that even if striking down the referendum is undemocratic (a moot point) it is justified because it will prevent disaster.  So obsessed with stopping Brexit are some left-leaning academics that they have abandoned Labour and joined the Liberal Democrats.

I believe there is a lot wrong with this thinking.  As a socialist, I have never been much of an enthusiast for either Parliamentary Sovereignty, or referenda – I would prefer to extend and deepen participatory forms of democracy in all walks of life.  The politics of the referendum campaign were dreadful.  The Remain side ran a dismally uninspiring pro-business campaign.  The Leave campaigns were much worse, replete with lies about NHS funding and naked racism. Yet, both Labour and the Tories committed to abide by the result long before the Referendum was held.  And, at present, there seems to be very little public appetite for reversing it. If anything, the contrary is true. Arguably, then, if Parliament refused to trigger Article 50, it would be striking down the referendum in the face not only of the result itself but widespread and enduring public opposition. In these circumstances, the justification for stopping Brexit would seemingly boil down to the claim that “we know better than you”.

There is nothing wrong with expertise.  We need it very badly if we are to flourish as a species.  The racist right has cynically exploited growing public skepticism about expertise, but skepticism itself is far from unreasonable.  For example, the field of economics not only failed to predict the 2008 crisis it refused to acknowledge even the possibility that such an event might happen. It colluded in making the crisis by aligning itself, conspicuously and unapologetically, with neoliberal ideology. Economics departments in leading universities have long since been cleansed of anti-neoliberal (heterodox) economists. Where real scientific expertise depends on openness, plurality, modesty and healthy skepticism, economics relied on institutional power, arrogance, dogma and intellectual closure.  Of course, not all economists are guilty of this kind of behavior – far from it.  Nevertheless, it is untenable to think that invoking economic expertise will work as a justification for striking down the referendum.

At the same time, the UK is going through a growing crisis of democratic representation, a condition Colin Crouch calls “post-democracy”.  The institutions of the state, repeatedly exposed as seedy and corrupt, are held in diminishing public esteem. If, in some ideal world, it could be argued that the British State works for the rights and freedoms of all, the majority might just be convinced to put our collective sovereignty in the hands of an institution like Parliament. But today, our decaying institutions could not possibly carry the people without naked political repression. Presently, there is no justification for demanding that MPs overturn Brexit. On the contrary: it would not be democratic and alternative appeals to sovereignty, backed by claims to expert knowledge, are not politically credible.

For these reasons, it is now the turn of Remain supporters to heed warnings about unleashing forces they cannot possibly control.  Striking down the referendum would be politically catastrophic, not least in triggering a further racist backlash. Three line whip or not, Jeremy Corbyn’s position on Article 50 is correct in my opinion. And, it provides some basis for opposing a reactionary Brexit thereafter.

The other Remain demand is that once Article 50 is triggered, the UK should try to stay within the EU “single market”.  This is generally what people mean by a “Soft Brexit”. The PM has ruled this out, because it would mean having to accept “free movement” of EU citizens.  Mrs May therefore proposes a nationalist and anti-immigration “Hard Brexit”.  I deplore that and seek to defend the principles of “free movement” for people and the right of refugees to sanctuary in the UK.  Is the “single market” really the way to do that?  Some time before the EU was founded, the right wing Mont Pèlerin Society envisioned a single market. These founding fathers of neoliberalism later influenced Margaret Thatcher, who celebrated Britain’s accession to the single market:

“It’s your job, the job of business, to gear yourselves up to take the opportunities which a single market of nearly 320 million people will offer. Just think for a moment what a prospect that is. A single market without barriers—visible or invisible—giving you direct and unhindered access to the purchasing power of over 300 million of the world’s wealthiest and most prosperous people …

As Mrs Thatcher recognized, the EU single market promotes free market capitalism, competition and corporate profitability. No-one on the left thought it was a good idea in 1988. It certainly isn’t now.  The single market and other pro-market institutions are antithetical to equality, solidarity and democracy. Even the IMF now concedes that “instead of delivering growth, some neoliberal policies have increased inequality, in turn jeopardizing durable expansion”.  Markets – single or otherwise – polarize. And they crash. To regain our credibility, the left must surely fight for more worthwhile and tangible goals. If so, the real challenge is to both defend free movement and fight for an entirely different economics rooted in socioeconomic equality and solidarity.

The inspirational global response to Donald Trump’s racist edicts shows that this combination of demands is entirely pragmatic. Protests against Trump’s impending visit to the UK could be among the biggest ever held in this country. The Stand up to Racism demonstration on 18th March will also be very big.  Defending migrants and refugees will be among the key demands.  Most importantly, it is possible even now to see how the wave of giant protests across the UK and US can incubate an entirely different politics of hope and solidarity. The boomerang effect of anti-Trump protests in the UK is already plain to see, as Mrs May’s humiliating encounter at the White House exposes the absurdity of racist claims about reclaiming UK sovereignty.  Barricading ourselves behind discredited political and economic institutions is wrong and it will not work.

Jonathan Davies is Professor of Critical Policy Studies and Director of the Centre for Urban Research on Austerity at De Montfort University.

Post-Brexit Devolution: What Should it Look Like?

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brexitIn this post Paul O’Brien argues that after Brexit devolution should  empower local government to deliver a localised industrial strategy.

Councils could be forgiven for wondering if Government remains as committed to devolution and decentralisation of power, post Brexit, as it appeared to be before June’s vote.

What started well and seemed to have support at the highest level of Government, with George Osborne’s zealot like enthusiasm, doesn’t appear to have the same prominence with new cabinet figures, indeed some fear that the agenda could simply fizzle out.

It would be a major policy U-turn to cancel next year’s mayoral elections for the big three combined authority areas of Greater Manchester, Liverpool City Region and the West Midlands, however it doesn’t appear that many other deals are close to completion with almost daily stories of negotiations collapsing.

Whilst some find the idea of having an elected mayor forced upon them objectionable, others have concerns over whether you are really going to get what you signed up for in terms of funding for projects or powers, given the economic uncertainty that exists post Brexit.

Given the financial crisis local services face, decentralisation is exactly what is needed. It’s clear the public feel that they are not getting their fair share of resources. APSE’s recent opinion poll, with Survation, found 77% of the public want more of their taxes spent locally, rather than elsewhere.

There now appears to be a consensus amongst Government that the UK needs a new industrial strategy with national infrastructure projects at the heart of it. However, what is really needed is for local government to be recognised as the key to driving a localised industrial strategy, and given the powers and funding to deliver it. One that can draw in investment and stimulate local growth, which will have an immediate impact now, rather than in fifteen years time.

Devolution to date has been about individual authorities combining and going to Government asking for funding to undertake initiatives that are ‘unique’ to their area but in reality when you examine many of the Combined Authority Orders there are common themes running throughout. So is it really necessary to painstakingly go through the process of putting these together and then spend months negotiating back and forth with civil servants on the detail? Is it not time for the sector to get together, as a whole, and ask Government for a devolution package around local industrial strategies, including borrowing powers for housing, transport and roads infrastructure, employability and skills development?

In the current climate of uncertainty we may just find a Government that is willing to listen to creative solutions to problems, which they are struggling to find answers for.

Paul O’Brien is Chief Executive of APSE (the Association for Public Service Excellence) and a member of the Centre for Urban Research on Austerity

Restricting immigration won’t pay for working people

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In today’s blog, guest bloggers from the New Economics Foundation (NEF) – Olivier Vardakoulias (Economist) and Marc Stears (CEO) – argue that restricting immigration  will not benefit workers in areas that voted in favour of Brexit. This post was originally published on NEF’s website – see here.

If we have learnt anything so far from party conference season, it is that free movement from the European Union has fewer and fewer supporters in mainstream politics.

When it comes to immigration, Brexit is becoming hard Brexit before our eyes.Politicians of all sides appear to believe the communities that voted to Leave the EU have legitimate concerns about immigration’s impact on their living standards.Immigration restrictions, it is suggested, will benefit working people, especially by significantly increasing their pay.

But this is not true. An increase in immigration restrictions would, in fact, do very little to benefit workers in these communities.

If you look at data from the counties of the UK, you see that there is no correlation between increases in immigration and decreases in real wages of less skilled occupations. And there’s no correlation either between increases in immigration and local unemployment rates.

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Source: CEP election analysis

In fact, we might go even further. Restrictions on free movement may actually reduce wages and workers’ standards.

Because we know from history that immigration doesn’t stop when it becomes harder. Just look at Mexico and the United States. If more EU nationals enter the UK undocumented, they will be working outside official channels, labour laws and the official minimum wage.

And workers who are granted a visa by their employer (the current process for migrants from outside the EU) will be at the mercy of that employer.

Companies will have the power to hire and fire migrants and withdraw their working permit at will, leaving migrant workers with an even weaker bargaining power over their wages and working conditions.

So ending free movement may in reality put domestic workers in a more unfavourable situation than they are in now.

Restricting immigration from the EU is a false panacea for communities who have struggled over the last decades.

Politicians of all parties would do well to avoid selling this snake oil of a solution to the working people of Britain.

The EU Referendum and the ailings of contemporary democracy

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In this post Adrian Bua argues that Brexit highlights fundamental failures in contemporary British democracy.

Democracy was a key element of the debate around whether the UK should exit or remain in the EU. One of the main criticisms of the EU from both right and left is the distant and unaccountable nature of its institutions. And now, calls for the referendum to be repeated by those shocked by the actual and potential future consequences of ‘Brexit’ are increasingly popular. This move is condemned by Brexiteers as an affront to democracy. On the face of it, they make a valid point. The referendum result gave a clear, if narrow, mandate to leave. Ignoring it would further underline the reality of a pro-EU elite that has lost touch with those ‘ordinary people’ that politicians such as Farage argue have been oppressed by migration.

However, contemporary democratic theory places serious doubts on plebiscitary forms of decision making. In deliberative models it is not only the process of aggregating votes that matters, but also the processes of opinion formation preceding the vote. Leaving aside the widely debated, complex and unresolved issue of whether, and when, direct democratic processes are appropriate to make complex decisions – the phenomenon of the EU referendum highlighted clear deficits and inconsistencies in our representative democracy. In characteristically opportunistic fashion, David Cameron called a referendum to avoid a Tory split that could have been fatal for his 2015 election ambitions.  Martin Lodge and Will Jennings argue that this reflects a broader phenomenon whereby referenda are used not to advance democracy but for political leaders to control divisions in their own parties.

These inconsistencies reflect deep rooted problems in our political system. During the post-war consensus, the institutional landscape of British democracy was enriched by collective mass-membership organisations that had close relationships with political parties and kept them grounded in people’s lives. However, the current turmoil is arguably symptomatic of what Colin Crouch termed the UK’s condition of ‘post-democracy’.  The institutions of the social democratic consensus remain, but have been hollowed out by the de-politicising consequences of neo-liberalism and the dominance of politics by privileged individuals and big business. For citizens, elections have become a spectator sport, managed by experts and reported on by private media monopolies. The rise of single-issue politics has been a salutary development, but in no way has it matched the capacity for the institutions of collective action that heralded the social democratic era to channel demands into the political system.

I would argue that the vote in favour of Brexit is a symptom of Britain’s ‘post-democratic’ condition. It is no secret that it is the constituency that suffered the most from the economic re-structuring over the past few decades that favoured ‘Brexit’. The faith that neoliberal policy makers had for entrepreneurial private sector activity to replace the gutting on manufacturing and heavy industry never materialised in peripheral regions. Instead, what Colin Hay has termed an “anglo-liberal growth model” emerged – based on a service industry concentrated in London and consumption fuelled by private credit and a housing boom in the South East. Gordon Brown’s infamous declaration that boom and bust had been abolished revealed the institutionalisation what Colin Crouch termed an “unacknowledged policy regime”. The election-winning machine that was New Labour contributed to the post-democratic condition. Its obsession with “scientific” approaches to evidence based policy making cohered with Fukuyama’s “end of history” thesis – politics becomes a managerial and technical endeavour. Citizen participation becomes limited to focus group and survey research designed to optimise the party’s chances to reflect public opinion and thus win elections. Importantly, this left behind the concerns of those working class constituencies that “have nowhere else to go”, as New Labour architect Peter Mandelson put it.

But the chickens have come home to roost. The financial crash, and ensuing recession, deepened the economic woes of peripheral regions. Public sector employment and redistribution from the proceeds of the economy in the South East reduced through austerity. This was compounded by the deepening of the, already established, ‘beggar thy neighbour’ politics that generated contempt for a dependency culture. The Brexit campaign deepened a discourse which was already well developed and increasingly propagated by corporate media empires, that blamed immigrants for economic woes – as well as a lack of ‘control’ over our borders and burdensome EU regulation. At the time of writing, the Labour Party which had given hope to so many people that this situation might change with the election of Jeremy Corbyn, is ripping itself apart with internal struggles between its left and right. It is unclear what the outcome will be, that is a debate for another day, but – regardless of whether Brexit materialises – it will certainly be of great importance in the struggle to shape a fairer, more inclusive and democratic Britain. Should the right win, we can expect even more tea mugs and headstones promising to control immigration than in the campaign ran by Ed Milliband.

Inside and outside the Labour Party, the left should counter this discourse by finding improved ways of communicating the message that the difficulties faced by many supporters of Brexit are not due to immigration, EU regulation of lax border controls, but by a deliberate, and by no means irreversible, re-shaping of the UK political economy since the late 1970’s.  An integral part of this is to articulate a left politics based on democratic participation, empowerment and investment in social services. As Adam Przeworski pithily stated “to discuss democracy without considering the economy in which that democracy must operate is an endeavour worthy of an ostrich”. The left needs to develop a coherent and convincing vision for an alternative political economy that delivers genuine equality of opportunity, and meaningfully redistributes wealth and power. In this vein, Jonathan Davies has called for the UK and European nations to develop a “Marshall Plan for the 21st Century”. It is imperative to put flesh on the bones of this idea, and organise for its fulfilment. Social democracy should end its flirtation with neo-liberalism and regain the necessary confidence to regenerate itself on its own grounds. There is a rich legacy of thinking on participatory forms of socialism to draw on here. EU elites seem keen to make an example of Britain through a painful divorce, and the disposition of the likely UK post-Brexit leadership will be to turn the UK (or what remains of it) into some sort of libertarian utopia and international tax haven – “a free-wheeling island nation” as put by one article outlining a terrifying blueprint for a post Brexit Britain. This “scorched earth plan” is the way we are currently headed, and it is not pretty.

Dr Adrian Bua researches for the Centre for Urban Research on Austerity and the New Economics Foundation.

A European in Leicester: a poem on Brexit

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In this post Hulya Oztel shares a poem she wrote after the Brexit vote, capturing how she feels as a French citizen working and living in the UK.

Channel

I did not know I cared for the Channel that much,
I did not know I cared at all.
I now realise she was sheltering me.

Britain thinks she has left Europe
United she has – with the worst of the continent.

The gangrene has spread,
Spilling out of foul mouths – aloud.

The gangrene has spread,
Its stench pushing us apart.

The gangrene has spread,
polluting our children’s future

Hulya’s feelings mirror those expressed by P.J. Harvey in her song “England” (listen here). They reflect the sadness that stems from the rise of the far right – in France over the last 20 years, and now in the UK.

Hulya Oztel is Principal Lecturer at the Leicester Business School in De Montfort University

Two-tier Europe: the UK and associate membership

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Carol Weaver argues that Brexit should lead to a redesign of EU membership, leading to the formalisation of a ‘two-tier Europe’ composed of full members and ‘associate members’ that agree to the same rules.

Václav Havel once talked of the ‘power of the powerless’ and whilst that may well have been a very good thing with regard to the Velvet Revolution unfortunately it does not seem to have been a very good thing last week in the EU referendum here in the UK.

I’ve always told UKIP (in debates with them) that they can never have an ‘independent UK of Great Britain and Northern Ireland’. In attempting to achieve this they would inevitably destroy the very union they say they want to protect. I also told Nick Clegg some years back that he was wrong in supporting an in-out referendum with the hope the people would vote to stay.

But we are where we are so why not make the most of it. The EU has become problematic and we have discussed and debated ‘widening v deepening’, ‘two-tier Europe’, ‘multi-speed Europe’ and ‘variable geometry’ for many years now. What we have accidentally achieved, in the usual EU way of compromise, is some kind of mélange of all of these.

Now it might be time to deliberately redesign Europe with a choice of:

  1. ‘Full membership’ including Schengen and a Eurozone with deepening and more fiscal unity
  2. ‘Associate membership’ with all associates agreeing to the same rules rather than having, for example, a ‘Norway model’, a ‘Swiss model’ and a possible ‘British model’. This should not be so attractive that Eurozone countries would want to join.
  3. No membership at all.

The associate membership would not be ‘all but institutions’. It would mean limited membership of appropriate institutions with no say in the core workings of the Eurozone and possibly limited freedom of movement without full citizenship. It would apply to countries such as the UK and others that do not want to join the euro. It could also apply to countries such as Turkey once it has completed all relevant chapters. Widening of full membership is currently not feasible.

Former MEP Andrew Duff, a lifelong committed federalist and EU constitution supporter, realised this was necessary in 2013, saying ‘So the Convention in 2015 needs to craft something other than privileged partnership outside the Union, something more than the EEA, yet something less than full membership. The European Union has proved itself over the years capable of great constitutional ingenuity, and it is reasonable to assume that, given the political will to work together for the good of all Europe, it can continue to do so.’

David Cameron has in the past discussed this idea with other EU members .

The new design would mean a new treaty which could trigger more referendums including here in the UK where we have a ‘referendum lock’. This might be better than in-out referendums across Europe backed by right wing parties such as the Front National often themselves backed by Russian money.

At the time of writing Article 50 has not been invoked. There is time to consider the possibility of a new treaty outlining formal Associate Membership. It will take some time but so would any other option.

Dr Carol Weaver is Lecturer in International Relations at De Montfort University.

Brexit: the Need for a “21st Century Marshall Plan”

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2000px-marshall_plan-svgProfessor Jonathan Davies argues for a new “Marshall Plan” to fix the broken political economy of the UK, and of Europe.

There are long decades when history barely moves.  And there are times when decades or even centuries fly by in weeks.  Political history in the UK is suddenly moving at breakneck speed.  Our relationship with the EU is sundered, the UK itself fractured along a bewildering tangle of lines.  The possibility of Scottish secession looms once more.  Friends are at each other’s throats.  Terrified remain supporters – and a good few remorseful leave supporters – call for the government to set aside or ignore the referendum.  The Parliamentary Labour Party has turned all its fire on Jeremy Corbyn, while the Liberal Democrats court redemption by making a play for enraged middle class progressives.  The Conservative Party is in turmoil as is the repentant architect of Brexit, Boris Johnson.

In this febrile atmosphere, the battered, embittered and disenfranchised working classes forming the backbone of Brexit has been chosen as the chief villain of the piece – although almost half of them did not vote at all.  Stuck between the rock of racism and the hard place of “progressive” middle class contempt there is, as always, nothing on the table for them.  We must be clear that the grind, hectoring, dispossession and punishment of austerity and several decades of neoliberalism before that lie at the root of these fractures, themselves symptoms of the long durée of economic decline.  The exuberant junketing of our elites cannot disguise the feebleness of British economic growth, the illusion of shared prosperity sustained through astronomical levels of personal and private debt. The costs of this model have been imposed – quite ruthlessly – on those least able to bear them.  The realities of UK PLC for millions of people are, structural unemployment, zero hours contracts, sweat-shop labour, benefit cuts and sanctions and food banks. Brexit is the blowback.  Even so, conditions are far worse in Greece and Spain.

If Britain and Europe’s elites were serious about keeping the ship afloat, they would recognise the appalling vista they have created, abandon neoliberal ideology and austerity wholesale and embark on a massive programme of redistribution and investment in working class towns and cities. Britain and Europe would move to initiate a 21st century Marshall Plan – the post-war reconstruction programme led by the USA after WW2.  We live in very rich societies, but with ever-greater concentrations of wealth and poverty.  The very existence of the United Kingdom and European Union could now depend on the political will to reverse that trend.  Enormous ideological and political resources have been expended on neoliberalism, and such a step looks vanishingly unlikely.  It is much more likely that the reverse will happen and an even heavier price will be exacted from the working class.  Moreover, it is a moot point whether such a programme would be enough reverse the decline of late Western capitalism.  Either way, Britain and Europe can certainly afford it.  If they want the genie back in its bottle, they will have to pay the price.

Jonathan Davies is Professor of Critical Policy Studies and Director of the Centre for Urban Research on Austerity at De Montfort University

Brexit – A Nation Divided

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CURAs Jonathan Payne reflects on Brexit its causes and its consequences for UK progressives

The people of Britain woke up this morning to a Brexit vote and a country deeply divided and ill at ease with itself and its place in the world.  Democracy, the will of the people, had spoken, but no one was quite sure what the consequences would be.

Cameron’s decision to put the question of Britain’s membership of the EU to the people was less about democracy, however, and more about appeasing the right-wing Euro-sceptic elements within his own party, that have been festering for decades, and heading-off splits in the Conservative vote from UKIP. The people, albeit by a slender majority, have now given their decision, rejecting the views of the  ‘experts’, such as the OECD and IMF, who said this would be bad for the economy and jobs. It was Michael Gove who said, ‘People in this country have had enough of experts’, and it would seem, on that score at least, he was more than half right. Like so much of politics, this has been about feeling and sentiment as much as facts and argument.

There is no doubt that some in the Leave campaign, with immigration its strongest suit, played on many people’s fears and anxieties. Right-wing populism thrives by blaming the ‘outsider’ for problems, the roots of which lie elsewhere: in the lack of investment in housing and public services wrought by austerity and in a neo-liberal growth model that generates profound social inequalities and deprivation. Such populism is a cancer that tears at the very heart of an open, tolerant society, one which history teaches us we should all be deeply afraid of.

Perhaps this is why many are so worried about the visceral tone of the debate and what has been unleashed in the process. And what has been unleashed? If the Brexit vote illustrates anything, it is perhaps the deep sense of alienation and abandonment felt among the most deprived and marginalised sections of the white working class, abandoned for decades by the Conservative and New Labour projects. Some deprived neighbourhoods were, it would seem, literally no-go areas for Labour campaigners for Remain. The argument had been lost a long time ago. Many were fed up with ‘establishment politics’, and who could blame them?

And so a process of healing a divided nation begins. How will such anger and despair, unleashed by this referendum, be dealt with? If one question remains, when all the dust has settled, it is this: can Britain, outside of the European Union, forge a progressive growth model that can reduce inequality and work for all its people, in particular those who feel their voice has been marginalised for too long?  We can only hope that such anger can be channelled into progressive politics and there is the intellectual capacity, will and optimism to do so.

Jonathan Payne is Reader in Employment Studies at De Montfort University and a member of CURA (Centre for Urban Research on Austerity) as well as CROWE (Contemporary Research on Organisations, Work and Employment.