Turning point or stumbling block for EU?
Cardiff, Blair and the drive for EMU
As we approach the end of the British presidency of the European Union, it is necessary to take stock both of what stage the overall project of unification has reached and what Blair has achieved here in Britain.
Blair’s main concern at a European level is the success of EMU and to ensure the drive to introduce the ‘labour flexibility’ he is so proud of in Britain on a continental scale. Last year’s Luxemburg summit set this latter process in train, and Cardiff will consolidate it. Protesting against this will be key for those gathered for the counter-summits and demonstration in the Welsh capital.
At home, Blair will be pleased that recent opinion polls show that opposition to joining EMU has fallen. While there is still a majority against, New Labour has not really started its campaign for the forthcoming referendum.
This is likely to be stepped up after the Cardiff summit – and we are in store for a number of glossy stunts like Ulrike Johnson and Gordon Brown’s planned broadcast on the joys of EMU.
Activists in Britain must ensure that the momentum that is bringing thousands to Cardiff continues through to mount a vibrant and internationalist ‘No’ campaign.
Here we reproduce sections of a new Socialist Outlook pamphlet The Case Against EMU which analyses why European integration is so central for the European ruling class.
IN BRITAIN this issue has torn the Tory Party apart, reducing it to rump of feuding factions. It has divided the labour movement, with the TUC in full support of Maastricht, and thereby inhibiting the fight-back against unemployment and the defence of the welfare state.
The election of New Labour, however, has provided the dominant pro-European section of British big business with a government far more willing to do its bidding on Europe.
Despite equivocations, mostly for the consumption of the Murdoch press and the Tory right, Tony Blair and new Labour are fully committed to European integration and its flagship (EMU).
Blair’s close relationship with Clinton does not represent an alternative strategic approach to that of European integration. That relationship is based on his wish to emulate the American Democratic Party as an alternative to Labour’s social democratic past, and to follow the model of deregulation that Clinton and his predecessors have presided over.
Labour is fully prepared to go into EMU with all the consequences for the welfare state – Health, Education, pensions and benefits – which are involved. In fact preparation for EMU has been the cornerstone of Labour’s economic policy since it came to office.
This was behind Brown’s decision to hand over the control of interest rates to the Bank of England (ending such government control is a requirement of EMU) and was one of the reasons for the acceptance of Tory spending limits for Labour’s first two years of office.
These measures led Britain to qualify economically for entry into the first round of EMU. Blair has chosen, however, for political reasons, not to take up this option and attempt to enter EMU at this point.
Blair has two problems: how to win a referendum on EMU, with opinion polls currently running 60-40 against him, and how to enter it and keep Rupert Murdoch (and the Sun) on board for the next election.
They are difficult problems. Murdoch is a committed opponent of EMU from the standpoint of the Tory right. It is hard for Blair to avoid a referendum given the high profile election pledge on it – other than including it in his next election manifesto, which would give the Tories a platform.
Blair therefore holds fire but stands committed to enter EMU as soon as he judges he can surmount these problems. Big resources are already being put into changing public opinion by persuasion, and if that doesn’t work the frighteners will be brought out, and people warned of the ‘dire consequences’ of staying outside the forthcoming EMU zone.
EMU will be launched on January 1 1999. Eleven states have qualified by a combination of repeated cuts in public spending and fudging the criteria at the edges. Outside will be Greece (excluded for missing the criteria) Britain, Denmark and Sweden.
The question now is not whether to launch the EMU, or whether the technical questions can be solved, but how to launch it as a stable currency, rather than into a crisis.
This is a major problem given the turbulence in the currency markets and the crisis in the Asian economies. It would be a disaster to launch it just before a recession, which may well happen. But the huge expenditure of political willpower which has driven the project this far remains in place.
Despite the determination of the key governments, there are serious problems with EMU, beyond economic stability. Public opinion remains deeply divided in all the main countries of the EU, as can be seen once again by the relatively narrow result in the recent Danish referendum on the Amsterdam treaty.
From the point of view of its key backers however, EMU cannot be allowed to fail. It is a crucial touchstone for showing in practice the possibility of transcending the established nation-states and creating a truly European ruling class with its own institutional framework – or state. EMU therefore represents a watershed – a turning point or a stumbling block – for the future of the EU.
But there is even more than that. The European Union is an integral part of an increasingly globalised world economy which has given renewed impetus to the formation of large, competing trading blocs.
Intensified global competition between ever larger multinational companies has resulted in a desire to secure larger home markets, common currencies, and for an institutional framework for the concentration and rationalisation of capital.
If the restructuring is to be fully realised it requires federal institutions through the introduction of EMU.
Globalisation is leading to greater integration within the European Union on the one hand the emergent economic power blocs on the other.
The EU is a preparation for the more effective competition with the economies of the Pacific rim (dominated by Japan) and a North American Free Trade Area (NAFTA) dominated by the USA.
It is an integral part of a world increasingly dominated by international capitalist institutions such as the World Trade Organisation (WTO), the International Monetary Fund (IMF) and the World Bank and the Multilateral Agreement on Investment (MAI).
These institutions are the driving force of the world-wide neo-liberal offensive against the working class promoting economic and financial deregulation and labour flexibility.
This is the "internationalism" of the capitalist class: it must be challenged by a new level of working class internationalism and solidarity, glimpses of which we have begun to see in recent European strikes and campaigns such as the Euromarches.