Should Labour take Britain out of Europe?

A couple of weeks ago, Labour voted with Tory rebels to pass a motion demanding a cut in Britain’s contribution to the EU budget, after David Cameron had indicated that he’d love to achieve a cut but would accept a freeze. The move drew criticism from some commentators (and naturally from ministers of the defeated government) that instinctively Europhile Labour had acted cynically and tactically in order to inflict a defeat on Cameron.

Well, it’s Labour’s job to do everything it can to oppose, impede, weaken and hasten the end of what is the most radically right-wing and ideologically ambitious government in my lifetime, outstripping even Thatcher in her zeal to dismantle the state and impose an ‘everyone for himself’ regime on this country. It’s also worth noting that, in signalling in advance what he was prepared to accept, Cameron showed himself to be a very poor negotiator – but then, he still applauds himself for his December 2011 ‘veto‘ of an EU treaty intended to shore up the Euro, which went ahead anyway. So it’s fairly obvious that, for all his posturing and tough talk, Cameron isn’t really fit for a seat at the table with the big-hitters anyway.

It’s also right when, for all its futility, British people are under the cosh of a massive austerity drive, that the level of Britain’s spending on EU funding should be cut as well. So while Labour will certainly have rubbed its collective hands at the prospect of defeating this lamentable government, it could enjoy it in the knowledge that it was also doing the right thing.

However, I believe that the whole matter has flushed out another question that is far more important, in the long term – one which I’ve heard little or no comment on in the couple of weeks since the defeat. And it’s one that might surprise many, and shock some:

Should Labour bring Britain out of the EU?

Before I probe further into that question, let me clarify that I’m an instinctive Europhile. I’ve spent most of my working life travelling to most of Europe, and I speak several European languages. I’m at home pretty much anywhere, love the variety of scenery, architecture, language, culture and outlook, and enjoy – for the most part – the various differences that typify the people of each nation. So it’s fairly momentous for me to even seriously pose the question, let alone consider that the answer might be a positive one.

A bit of history

It may seem hard to imagine now, but until the era of Kinnock as leader, Labour’s left was fairly unanimously anti-EU – or anti-EEC (European Economic Community) as it was then, because Left-wingers considered the EEC a dangerous opportunity for capitalism to take a group of nations in a vice-grip. From Kinnock onwards, the prevailing view shifted to one in which a strong Europe could act as a bulwark against the worst excesses of Thatcherism/Reaganism, and the Left became generally pro-European. But things change, and there’s nothing intrinsically left-wing or Labour about being in favour of EU-membership – it’s just the usual Labour position now.

If you want more information on this, you could do worse than to listen this episode of BBC Radio 4’s ‘Analysis’ programme, ‘Labour, the Left and Europe’.

The whys and wherefores

As well as being instinctively pro-European out of experience, I also recognise the various pros of EU-membership: tariff-free access to a wide geographical market, the right of free movement, closer co-operation among nations that have historically fought each other on a regular basis, and so on. Certainly not insubstantial positives, and recognised by the recent decision to award the Nobel Peace Prize to the EU (although this kind of involved forgetting the horrors of the Balkan conflict).

Valuable factors, and not to be given up lightly. But recent developments within the EU, surrounding but not entirely because of, the ‘Euro crisis’, have me very concerned. I’ve written on several occasions about how neo-liberals will exploit crisis in order to push through economic ‘structural’ measures that are designed to enrich the ‘elite’ while inflicting ‘planned misery’ on the many.

And not merely exploit – governments and even supposedly neutral and benevolent agencies such as the World Bank and the IMF have pretended crises and even deliberately engineered them, in order to achieve political and ideological aims that were unattainable when the populace perceived economies as being essentially stable.

Crisis as an excuse

So, be wary of assuming what you hear is true when the news channels and IMF/EU/World Bank officials describe the ‘crises’ in Greece and other nations. The crisis has primarily been in the banking system and its greed, rather than in the conduct by governments of their economies, and yet the ordinary people of Ireland, Greece, Spain, Portugal and Italy (and, so far to a lesser extent, the UK) have been hammered by austerity measures while the bankers still get fat on bonuses.

And the power-brokers are not finished yet. Europe’s political and financial leaders  – supposedly – need to address the currency and banking crisis in the Euro-zone, yet the measures that they are planning to impose mainly touch on the general populace. The OECD report ‘Going for Growth 2012‘ recommends two structural reforms for the banking sector (increasing the capital reserve requirement and enhancing regulation – alongside at least 26 reforms that target the general population, including:

– Making it easier and less expensive to sack workers
– Increasing retirement ages and pension contributions
– Reducing wages and protections for part-time workers
– Removing energy price-controls
– Removing tax exemptions for lower earners to ‘broaden the tax base’
– Reducing overtime pay rates
– Reducing unemployment benefits
– Increasing direct taxation such as VAT
– Accelerated privatisation of public assets

and many more. The report aims these measures at Greece, Spain, Portugal and Italy for now, but as Europe moves closer toward banking and fiscal union, these will become standard measures across the EU. Any right-thinking person already knows that ordinary people are paying the price for the excesses and misdeeds of bankers who continue to get richer while the rest struggle to stay afloat – but the plan is for more, not less, of the same.

Club Rules

Membership of the EU creates another long-term problem. The solution for to a shortfall in tax revenue is not to cut spending, which sucks money out of the economy, prolonging and intensifying recession and taking cash out of everyone’s pocket – including the small businesses that the Tories claim to love. No, the solution is to increase revenue – changing tax rates where necessary but primarily by improving enforcement of taxes on the big companies that can afford all the clever ways of avoiding paying their proper contribution to the societies in which they operate.

Earlier this week, senior executives of Google, Amazon and Starbucks were torn to shreds by a Parliamentary select committee over their failure to pay taxes on business transacted in the UK. Their justifications for doing so ranged from thin to pathetic – yet EU trade law does not allow one country to tax income declared for taxation in another EU country or to prevent a company from setting up its affairs to incur a lower tax rate in a different country. So, as long as these and other companies are careful to set up their tax affairs according to the relevant laws, a UK government is effectively powerless to force companies to pay tax on their earnings on business even when it involves UK goods, stored in a UK warehouse, shipped by UK staff and paid for by a UK resident.

Put together the tax situation and the prevailing acceptance that austerity is the only medicine, and it’s clear that Britain faces a situation in which, once again, the EU is transforming into a huge playground for companies to make huge profits while the ordinary populace is squeezed dry and has little freedom to elect governments that will not bow to the transnational, IMF- and World Bank-inspired consensus that ‘restructuring’ (the removal of protections and safety nets for ordinary citizens) is the only imaginable route to travel.

The Tories agree with these measures and attitudes for the most part, while perversely wishing the UK out of Europe out of jingoistic nationalism and small-mindedness. But ordinary people, without necessarily realising it, sense that the EU is becoming a vehicle for potential and actual oppression in many ways. UKIP are a joke of bombast and small-mindedness, but their relative rise in the polls can be attributed to their tapping into this sense of unease, even though the rest of their politics yearns for the kind of measures that are the reason for it. So the risk is that the Tories and UKIP win favour and credibility for holding a position for all the wrong reasons, while Labour, with better motives and a far better narrative to tell if it chooses, loses the votes of ordinary, oppressed people.

I’m now starting to believe – reluctantly – that the time has come for Labour to take a lead and seize the initiative on continued membership of the EU, and to put forward the real and justified reasons why Britain should exit: to own that position in the eyes of the electorate and to take a stance in which its recent vote for a cut in contribution makes perfect, consistent sense.

Creating a consensus for a new way of perceiving and acting in a single state is going to be tough enough – even though most UK people are desperately longing for leaders with the vision and courage to propose one. By remaining in the European Union, Britain faces being shackled to a tall, deep wall of neoliberal agreement on misguided austerity policies that will impoverish many and enrich a few, and to tax policies and rules that will impede any attempts by this country to implement creative ways to redress the injustice of corporate tax avoidance..

Outside the EU, a Labour government would have the freedom to create whatever tax laws it wishes, and to construct them so that tax on UK-transacted sales must be paid into the UK treasury, no matter which tax haven companies choose to report the income in. This would reduce or even remove any need for austerity – and would be massively popular politically as a bonus.

Europe is no longer a bulwark against the US-inspired neo-liberal policies of low taxation, no-regulation free-for-all, but is rapidly becoming a stronghold of them. Because of this, Labour needs to be bold and declare its desire – and a perfectly-justified one – to take the UK out of Europe, so that it can be held at arms-length while we construct something better. If we succeed, then we can be the example that countries behind the austerity-curtain rally around and follow, bringing an end at last to the economic oppression that is being forced on us.