A new initiative

On 26-27 April an international workshop will take place in Thessaloniki, Greece, titled “What is the Future for Europe?” Social scientists and political activists from across Europe will take part, including from Germany, France, Spain, and elsewhere. On the evening of the 27th there will be an open political meeting in the city, with the same topic, at which Oskar Lafontaine and Costas Lapavitsas will be keynote speakers.

The event marks the launch of the European Research Network on Social and Economic Policy, a new initiative based in London, with offices in Thessaloniki, and Europe-wide membership. EReNSEP has two aims. First, to produce high-level, evidence-based work that would have an impact on the policy debate in Europe. Second, to organise events and political activities in line with the work produced. In brief, to combine grounded analysis with targeted political intervention challenging the European mainstream.

There is already a search for alternative strategies in Europe, as has been shown by two recent conferences – one in Paris and another in Madrid – regarding a so-called Plan B. Among the members of EReNSEP are economists and political theorists who have been developing alternative arguments for Europe for several years.

Participants at the workshop include academics from leading universities in Spain, France, Germany and elsewhere. Participants also include members of a wide range of political organisations actively seeking a new strategy, such as the Candidatura d’Unidat Popular (CUP) in Catalonia, the Parti de Gauche in France, the Initiative for Democratic Socialism (IDS) in Slovenia, and Die Linke in Germany. There will also be a strong Greek intellectual and political presence, hardly surprising in a country ravaged by austerity and governed by SYRIZA that has promised so much and delivered so little.

EReNSEP aims to contribute to a genuine alternative strategy for Europe. Austerity has proven disastrous and fresh policies are needed for growth, employment and rising incomes. Worsening inequality has raised a strong demand for redistribution. Furthermore, the European Economic and Monetary Union has failed, making it necessary to devise new monetary arrangements for individual countries and for Europe as a whole.

Above all, the institutions of the EMU and the EU have led to a loss of sovereignty and an attendant decline of democracy across Europe. Restoring sovereign and democratic rights in Europe is vital, if political life is not to slide further downhill. The state of the continent at present gives cause for deep concern.


A continent at an impasse

More than eight years since the outbreak of the global economic crisis of 2007-9 and six years into the Eurozone crisis, Europe has still not managed to escape turmoil. There is plenty of evidence of political and social instability offered by the rise of the extreme Right, the burgeoning wave of Euroscepticism, the forthcoming referendum on Brexit, and the appalling handling of refugees and immigrants. The European Union is entering turbulent waters and its future is uncertair.

Fundamental to the turmoil has been the persistent policies of austerity as well as neoliberal reform of labour markets and the state across the EU. These policies are closely interwoven with the institutions and structures of the EMU. Far from delivering convergence, stability, and growth the common currency has been a mechanism for austerity, unemployment, inequality and lack of growth. It has entrenched profound differences among member states, encouraged national hostility and buttressed a new hierarchy of power in Europe. Last but not least, it has led to a disregard for democracy across the continent.

The clear beneficiary has been Germany, which has emerged as the largest exporter, the largest lender and the most powerful country on the continent. The biggest losers, so far, have been countries of the periphery – above all, Greece, Portugal and Spain – mired in stagnation and dependence on the core. But a great risk also exists for the countries of the core, or the semi-core, mostly France and Italy. Unable to compete with Germany, trapped in low growth, they face long-term decline and loss of political power.

The euro rests on a complex structure of institutions that have placed themselves among and often above nation-states. The most powerful institution on the continent is the European Central Bank, the absolute controller of liquidity. But there is also an array of other, formal and semi-formal, institutions that shape policy for member countries. The Eurogroup and the EuroWorking Group stand out – unelected, undemocratic, unaccountable, and enormously powerful. These mechanisms of the EMU are imbued with neoliberal ideology, and inherently favour austerity and neoliberal reform of the labour market and the state. They have gradually become the backbone of the EU itself.

The reality of power in the EU is far removed from the mealy-mouthed platitudes of the European Commission and the verbal meanderings at the European Parliament. EU power has nothing to do with serving the public good, or promoting solidarity and unity among European people. It serves primarily the interests of big banks and big business, as anyone who has been near the bureaucracy of Brussels will confirm immediately.

The mechanisms of the EU are contemptuous of democracy and openly transgress the rights of sovereign countries, as has been shown time and again in the course of the Eurozone crisis. The EU has, for instance, awarded itself augmented powers to monitor state budgets and to impose penalties on member states, buttressed by the “two-pack” and “six-pack” directives. Its mechanisms have shown little respect for electoral results in several countries. When the refugee crisis flared up in 2015-6, they did not even respect international treaties regarding the humanitarian treatment of people forced out of their homes. The EU has gradually become a “fortress”, effectively closed to persecuted people, even when their countries have been attacked by European armed forces. It is no wonder that this performance has ruined the ideology of “United Europe” as a “soft superpower”.


The rise of right-wing Euroscepticism

A remarkable aspect of the turmoil in the EU has been the inability of the political system to generate a strategy for Europe to escape the cul de sac. Led by a powerful political bloc in Germany, the prevalent message of European politicians has been that the continent needs “More Europe”. In other words, more policies that impose austerity, weaken labour rights, exacerbate inequality, transgress national sovereignty, and disregard democracy.

For the weak ruling blocs in the periphery, “More Europe” has been a bitter pill to swallow because it has caused palpable damage to peripheral economies, while reducing their international status. In Greece, the destruction has been enormous and the loss of sovereignty and geopolitical stature unprecedented. But an equally grave threat also exists for the ruling blocs of core countries that currently face the prospect of deeper austerity and “reform”. For France and Italy, “More Europe” is the path of decline and social disaster.

Nevertheless, “More Europe” has been the only policy framework that the ruling blocs of the EMU have been able to generate so far. Fundamental to it are the interests of big banks and big business across a range of European countries, which will not contemplate another path. Europe is trapped by hidebound institutions backed by business interests and German power.

In this context, the main beneficiary of the tensions and contradictions of the EU and the EMU has been the extreme Right. There is no mystery at all in this phenomenon. The Right has appropriated Euroscepticism, attempting to express the fears and worries of middle and working class, social layers crushed by “More Europe”. Fascism has reappeared on the continent, with large movements in core countries, such as France, and a powerful presence in smaller countries, such as Denmark. Authoritarian right-wing regimes that smell of fascism have emerged in Poland and Hungary. Conservative populism has made headway in Italy. Even in Britain, the mother lode of liberal democracy, whose ruling bloc has wisely avoided entering the EMU and been highly sceptical of “More Europe”, the dominant version of Euroscepticism is associated with the Right, even the far Right. The most dangerous aspect of the coming referendum on EU membership is that Brexit could prove a huge boost to the far Right.

Fundamental to the rise of right-wing Euroscepticism, needless to say, has been the relative absence of the Left from the ideological debate. Historically, Europe could always rely on the powerful voice of the Left to point out the destructive and unjust nature of the operations of big business, to defend sovereignty and democracy, to argue for an alternative path, and put itself forth as a candidate for political power. Since the fall of the Berlin Wall, however, the large part of the European Left appears to have been lost in its own fantasy of “More Europe”. The absence of a coherent and confident Left Euroscepticism has left the field open to the far Right.


Confusion on the Left

For much of the 1990s and the 2000s much of the European Left considered the EU and the EMU to be inherently “progressive”, essentially because they were integrations going beyond the nation state. For the Left, the nation state represented rampant, undemocratic, and aggressive capitalism in Europe. Hence, the transnational forms of the EU that went beyond the nation state could be considered as evidence of social progress. The discourse of “globalisation”, prevalent at the time, favoured this approach since it encouraged a view of the state as a relic of the past, unfit for the era of big, transnational capital. The EU seemed to open up new fields of struggle against capital and in favour of labour.

From this perspective, the euro, despite its manifest institutional weaknesses, could also be interpreted as a step in the right direction. The EMU would create a common bond among the people of Europe providing a path to greater integration. The strategy for Left, in this context, ought to be to free the EMU and the EU from neoliberalism. The Left should fight against austerity and for redistribution, in the process transforming the institutions of Europe. The task for the Left, apparently, was to turn the EU into a “Europe of the People”, overcoming nationalism and the nation state. That was the substance of the Left’s Plan A, its basic strategy to confront the European crisis since the late 2000s.

The absurdity and hopelessness of this approach was clearly demonstrated by the disaster of SYRIZA in Greece in 2015. Elected on a platform of rejecting bailout strategies, opposing austerity, and pushing for a “Europe of the People”, SYRIZA gradually came to realise that the European institutions were unbending, undemocratic, and ruthless. Confronted with blackmail orchestrated by German power and effected through absolute control of liquidity by the ECB, SYRIZA surrendered unconditionally. Even worse, to cling to power it signed a bailout agreement.

There can be no Plan A in Europe today. If some in the European Left think that they can have success with some variant of the SYRIZA strategy, they should rapidly think again. There can be no democratisation of the existing institutions of the EMU and the EU. The answer for the Left must include dismantling the EMU and confronting the EU head on. The Left needs a strong dose of Euroscepticism, which is the only sound basis for a coherent Plan B.


For a new direction

A genuinely alternative plan for Europe should start by rejecting “More Europe” and all policies that serve the interests of big business and big banks. There is a range of alternative proposals on which a majority could be obtained in several countries in Europe: breaking with neoliberalism, rejecting austerity, bringing banks under public ownership and control, engaging in income and wealth redistribution.

These policies are not possible ti implement without scrapping the EMU. Europe needs new monetary arrangements that should aim to control the movement of capital as well as trade in foreign exchange across the continent. These measures could only be taken if the EU was put on an entirely different footing, establishing conditions for solidarity among European people.

A genuine alternative plan, moreover, could not be formulated without re-strengthening democracy across Europe, and reasserting basic social values. Democratic rights are vital to shaping economic and social policy as well as to dealing with the immigrant and refugee wave.

The lesson from the SYRIZA debacle, furthermore, is that democratic control is impossible without restoring sovereignty at the national level. Transnational institutions across Europe not only favour big business and big banks, but help bypass democratic processes. Sovereignty is a foundation of democracy, and the only basis for equitable relations at the international level. This is the foundation for a Plan B that could truly resonate with European people helping the continent get out of its impasse.