The class struggle is back! Who would have thought. After years of being told by the likes of John Major and then Tony Blair that “the class war is over” (Blair) and the we now all live in “the classless society” (Major) the working class has fought back, albeit under the motivation of the looney, populist Right rather than a progressive left, who remain a voice for capital. Remember when we were told that the Left-Right continuum was irrelevant now in this global world where nation states had given way to grand communities (like the EU) and that, in this new post-modern world, we could all be entrepreneurs (meaning we sell our labour to a capitalist!). And now we know that class never went away. It might have been hi-jacked by the Right but it is there – and it is powerful. Planet Earth to British Labour – do something about it or wither away and make way for a progressive new organised working class movement.



Before the referendum last Thursday I wrote two blogs. One in February 2016 – If I was in Britain I would not want to be in the EU. and one last Wednesday – Britain should exit the European Union.

The first argued along economic lines, the second traced the history of the original accession and showed how the British government lied to the people about the decision to enter the EEC.

Both blogs – as the titles suggest – would have put me in the Leave camp if I was a British voter. I am not a racist nor am I uneducated.

On Friday morning (Australian time), as it became obvious that the Leave vote would win, I tweeted that it “Looks like it will be a great result for UK. Now British labour has to abandon its neoliberalism & provide people with a progressive future”.

I was met with immediate hostility by so-called progressives tweeting that I was “delusional” and that “you don’t know the UK very well, do you?” and that I was a “billy goat” (meaning stupid).

More nasty E-mails followed as the ‘progressive liberal elites’ interrupted their consumption of their cafe lattes and croissants to tell me that the hoy polloi outside of London didn’t have sufficient education to understand what they were doing or they were just mindless racists.

The Remain progressives, were by implication, full of knowledge and wisdom and non-racist.

I wonder how many of these ‘liberal elite’ types with good incomes and stable jobs had opened their well-appointed London homes to the migrants!

But, at any rate, I was told, categorically, in non-elite language, it seems, that anyone who feared for their jobs and opposed a flood of non-unionised workers who would work below minimum wages coming into their local labour markets, were despicable racists who should not be able to vote on these important issues.

Ok!

Then who should vote?

Certainly not the hoi polloi, it seems.

According to the Oxford University educated Guardian journalist and well-known supporter of Tony Blair, Martin Kettle “the verdict on referendums should be a ruthless one. Never again”.

In his ‘post vote’ article (June 23, 2016) – If referendums are the answer, we’re asking the wrong question – we read that “Referendums have insinuated themselves into our politics in the last half-century” as well as “a lot of the other unwelcome aspects of modern Britain”.

He claims that “The referendum has conferred less legitimacy on politics”.

I liked John Pilger’s view on that.

In his Counterpunch article (June 24, 2016) – A Blow for Peace and Democracy: Why the British Said No to Europe – he talks about how:

A nineteenth century contempt for countries and peoples, depending on their degree of colonial usefulness, remains a centrepiece of modern “globalisation”, with its perverse socialism for the rich and capitalism for the poor: its freedom for capital and denial of freedom to labour; its perfidious politicians and politicised civil servants. All this has now come hometo Europe, enriching the likes of Tony Blair and impoverishing and disempowering millions. On 23 June, the British said no more.

He argues that the:

The most effective propagandists of the “European ideal” have not been the far right, but an insufferably patrician class for whom metropolitan London is the United Kingdom. Its leading members see themselves as liberal, enlightened, cultivated tribunes of the 21st century zeitgeist, even “cool”. What they really are is a bourgeoisie with insatiable consumerist tastes and ancient instincts of their own superiority. In their house paper, the Guardian, they have gloated, day after day, at those who would even consider the EU profoundly undemocratic, a source of social injustice and a virulent extremism known as “neoliberalism”.

The responses of some of the Blairites in the past few days has been similar to the reaction to my initial tweet, celebrating the power of the people, no matter how educated or connected they might be to vote and upset the elites.

John Pilger writes:

On the morning after the vote, a BBC radio reporter welcomed politicians to his studio as old chums. “Well,” he said to “Lord” Peter Mandelson, the disgraced architect of Blairism, “why do these people want it so badly?” The “these people” are the majority of Britons. The wealthy war criminal Tony Blair remains a hero of the Mandelson “European” class, though few will say so these days.

If you have read Mandelson’s 1996 book (with Roger Liddle) – The Blair Revolution: can new Labour deliver? – you will know that they claimed that the economic engine of Britain was the large multinational companies, the arms industry and the “pre-eminence of the City of London”.

Liddle admitted in a retrospective on the book, published by the policy-network, that New Labour was highly successful and “built on the cumulative foundations of those which precede them and, as such, a large and significant section of the Thatcherite settlement we inherited in office was incorporated into our framework for governance.”

The cosy world of these elites, masquerading as ‘progressives’ stood back and supported a construct (the EU) that trampled over the democratic wishes of the people of Greece.

Syriza, who Pilger constructs as being the “products of an affluent, highly privileged, educated middle class, groomed in the fakery and political treachery of post-modernism” were vehicles in perpetuating the elite desire to repress the wider population.

For the progressives that tweeted and wrote to me over the last few days who claim that the “EU is not neo-liberal” in outlook, I wonder if they have read the relevant treaties that govern the EU and the attached protocols that drive the whole operations of the outfit.

The Stability and Growth Pact and the subsequent changes (two-pack, six-pack, fiscal compact) are all root-and-branch neo-liberal constructs.

These constructs dominate economic policy making within the EU (even if Britain was exempt from them). They are used to crucify Greece, and allow unemployment in Spain to persist above 20 per cent indefinitely, to name just a few examples.

I reported the other day how the latest convergence report had used the three Member States that were deflating the most (as a result of failed economies) as their benchmark “best-performing Member States”.

The locked-in austerity mindset where nations that are failing badly in economic terms are held out as the benchmark to assess the economic credentials of other states is the hallmark of the neo-liberalism nightmare that has been inflicted on the world by these ‘elites’ over the last three decades.

Please read my blog – The European Commission and ECB outdo themselves in their quest for absurdity – for more discussion on this point.

I also read several social media posts by so-called ‘progressives’ claiming that membership of the EU didn’t compromise the sovereignty of the British Parliament – a conclusion that is clearly contradicted by the facts.

The – European Court of Justice – which has jurisdiction over all EU laws with no right of appeal, compromises any claim that Britain has to sovereignty.

Under Article 258 of the Treaty on the Functioning of the European Union, the ECJ determines whether a Member State has fulfilled its obligations under EU law.

Sovereign democratic nations, in my view, have a constitution that establishes a rule of law through the parliamentary system and is enforced by a separate judiciary, such as the High Court of Australia.

However, a significant body of British law and rules (estimated to be around 62 per cent when EU regulations are included in addition to Acts and Statutory Instruments – Source) are the outcome of membership of the EU and therefore come under the ambit of the ECJ.

So to say Britain’s parliamentary sovereignty is not impinged by its EU membership is incorrect.

But let me be absolutely clear. The problem with Britain is not its membership of the EU.

Getting rid of the EU membership was a necessary but not sufficient condition in order to expunge the problem which is neo-liberalism..

Some observations I have picked up over the last few years about the UK that I think had a significant bearing on the outcome of the Referendum.

In May 2015, Eurofound (the European Foundation for the Improvement of Living and Working Conditions) released its – Recent developments in the distribution of wages in Europe – report which concluded:

1. “The UK is remarkable for its polarisation” in wages.

2. “The Gini index for wages in the EU as a whole is 0.346 (for full-time equivalent wages measured in PPS), while the comparable measure for the US is around 0.4, and in the UK, the most unequal EU country, it is 0.404.”

3. After 2008, wage inequality has increased substantially across the EU, but “was to a large extent driven by developments in the UK”.

4. “UK wage inequality grew very rapidly after 2008.”

OECD data shows that since 1985 overall income inequality (not just confined to wages) has increased dramatically in the UK and the OECD concluded that the “low wage growth” has put “lower-income households at risk of poverty”.

It shows that all the tax and benefit policy changes since 2010 have had a “negative impact on household disposable income”.

When you put the rising inequality together with the suppression of disposable income growth, you know that the burden has been pushed onto the lower income earners and benefit recipients.

These trends run contrary to the aspirations for a fair society that British people continually report in surveys.

Past British Social Attitudes surveys reveal that “95 per cent of the public agrees “in a fair society every person should have an equal opportunity to get ahead” (Source).

In 2013, the YouGov – The Anglo-US Divide on Equality – survey reported that 78 per cent of British respondents said that “Ensuring that rich and poor children have the same chances to get ahead – Should be the government’s job”.

74 per cent said that it “Should be the government’s job” to “Making sure that every family has a decent basic minimum income”.

And even 52 per cent said it “Should be the government’s job” for “Redistributing from the better-off to the less well-off, right across the income range”.

However, the report by the Social Mobility and Child Poverty Commission published on August 28, 2014 – Elitist Britain – provided a chilling reminder of ‘who runs Britain’ from the perspective of their educational backgrounds and networks and how contrary the reality is to aspiration.

It found that the “relationship between incomes of parents and children is stronger in Great Britain than in many other countries”.

Child poverty is much higher in the UK (and getting worse) than in many other EU nations.

In the “UK, those from high income backgrounds are far more likely to have high income as adults”.

The Report studied “Who has the top jobs in Britain?” by background, school etc

They concluded that the results of their research:

… found elitism so stark that it could be called ‘Social Engineering’ … 71 per cent of senior judges, 62 per cent of senior armed forces officers, 55 per cent of Permanent Secretaries, 53 per cent of senior diplomats, 50 per cent of members of the House of Lords, 45 per cent of public body chairs, 44 per cent of the Sunday Times Rich List, 43 per cent of newspaper columnists, 36 per cent of the Cabinet, 35 per cent of the national rugby team, 33 per cent of MPs, 33 per cent of the England cricket team, 26 per cent of BBC executives and 22 per cent of the Shadow Cabinet attended independent schools – compared to 7 per cent of the public as a whole.

And these elites were dominated by those who had “attended Oxbridge – compared to less than 1 per cent of the public as a whole.”

The Report concluded that the “risks are ‘group think’ and a lack of understanding of those with different backgrounds” and the “narrow elite suggests serious limits on adult social mobility” and “The sheer scale of the dominance of certain backgrounds raises questions about the degree to which the make- up of the elite reflects merit”.

The decades of neo-liberalism have thus created a growing proportion of British citizens who are divorced from any of the gains in prosperity that have been made over this period. That is what the inequality data tells us.

That is what the Leave vote tells us.

Where has British Labour been in representing a voice against this elite domination? Absent – lunching with the City!

Remember the classic 2005 – Speech – by the Gordon Brown to the Confederation of British Industry (CBI).

The better, and in my opinion the correct, modern model of regulation – the risk based approach – is based on trust in the responsible company, the engaged employee and the educated consumer, leading government to focus its attention where it should: no inspection without justification, no form filling without justification, and no information requirements without justification, not just a light touch but a limited touch. The new model of regulation can be applied not just to regulation of environment, health and safety and social standards but is being applied to other areas vital to the success of British business: to the regulation of financial services and indeed to the administration of tax. And more than that, we should not only apply the concept of risk to the enforcement of regulation, but also to the design and indeed to the decision as to whether to regulate at all.

In bed with the city elites who were busily screwing over the workers and the unemployed.

The 2015 British Social Attitudes survey – is interesting because it presents a more nuanced view of UKIP supporters and the likely influence of UKIP on the exit vote.

We learn that:

Many people in Britain can, indeed, be characterised as ‘Eurosceptic’ in that they either want Britain to leave the EU (24%) or else to see the powers of the EU reduced (38%). However, Euroscepticism has been widespread since the late 1990s and while it appears to have increased further during the early life of the Coalition it has, if anything, declined slightly since 2012 … The rise of UKIP reflects a long- standing mood on Europe rather than the development of a new one.

The rise of UKIP was associated with the decision by Britain (under John Major) to sign the disastrous Maastricht Treaty, which barely passed through the British Parliament after a major rebellion from with the Conservative ranks.

It gained political ground as the British Labour Party became more pro-Europe under John Smith and abandoned its promise to withdraw from the EU if elected.

At the 1983 national election, British Labour leader Micheal Foot promised to exit within the next 5 years if elected. They did not unseat Margaret Thatcher.

After Tony Blair took office he promised in 2004 to hold a referendum to ratify the European Constitution Treaty. He didn’t hold it. He repeated the promise in 2005 but never fulfilled it.

Blair, whose reputation is in tatters following his behaviour over Iraq, was never a champion of the workers anyway.

Remember the famous 1983-84 case – Nethermere (St Neots) Ltd v Gardiner – who other than Tony Blair “acted for the employers” against low-paid and “vulnerable” female sewing workers in an unfair dismissal case. Fortunately, the bosses lost the case! But Tony continued his elitist ways once in power as Prime Minister.

When the Treaty of Lisbon was bulldozed through by the elites in Brussels, British Labour still under the Blairite domination, claimed that the Treaty was not the same document as the EU Constitution and therefore they didn’t need to honour any promise to hold a referendum. The UK ratified the Treaty in 2008 with no referendum being held.

In 2014, failed Labour leader Ed Miliband refused to countenance a referendum on the UK’s membership of the European Union.

UKIP was busily gaining supporters (by 2013 they were running at 10 per cent support in the Opinion Polls) and the British conservatives were proposing an In/Out referendum.

UKIP were increasingly appealing to workers who felt disenfranchised by the neo-liberal machine and the elitist manner in which the EU conducts its operations.

The EU was seen as a harbinger for corporate control and excess, as a defender of the out-of-control banksters and related crooks in the financial sector, and, increasingly, an enemy of the ordinary worker.

Its treatment of Greece is stark. It has overseen elevated levels of mass unemployment now for 8 years and is deliberatey seen to be following policies that entrench that state while the elites in the financial sectors get bailed out and escape with immunity from their failures.

The latest British Social Attitudes survey concluded that:

in spite of the party’s apparent ability to attract votes from those who voted Conservative at the 2010 general election, UKIP’s support base cannot simply be characterised as ‘right wing’. It is true that UKIP supporters are both Eurosceptic and generally tough in their attitudes to immigrants. They are also relatively more socially conservative in their attitudes to crime and punishment as well as relationships – although those UKIP supporters who agree that same sex couples should have the right to marry (48%) now outnumber those who disagree (31%). But at the same time, UKIP supporters express a level of concern about the degree of economic inequality in British society that puts them on the left on that issue … Thus UKIP appears to have been successful in bringing together a group of voters who are not only anti-Europe and socially conservative in outlook (including not least in their attitudes to immigration), but who are also concerned about economic inequality and at the same time are deeply suspicious of government.

From the outside (not living in the UK), it is clear that UKIP has been providing a voice for views that British Labour would have traditionally provided before it became neo-liberal in its economic slant.

British Labour abandoned its heartland in the 1970s when it adopted austerity and deliberately used unemployment as a policy tool to fight inflation, which it made its priority.

My series – Demise of the Left – which is still being written, provides the whole sordid historical tracking of British Labour’s abandonment of its commitment to full employment and its advocacy for what we now call neo-liberalism.

That is why British Labour resoundingly lost the last national election despite the appalling economic management of the Tories and it is, in part, why the Leave vote won.

British Labour spineless reluctance to voice a progressive line not only allowed the immigration overtones to run rife in the lead up to the Referendum vote last week but also gave credibility to UKIP and other conservative forces, such that people are now calling the Leave vote a right wing coup.

So it should be clear that the EU is not the problem but part of the problem.

I liked George Monbiot’s column (April 15, 2016) – Neoliberalism – the ideology at the root of all our problems.

He notes that this orthodoxy that has infested the world over the last 3 to 4 decades “sees competition as the defining characteristic of human relations”.

Accordingly:

The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages – such as education, inheritance and class – that may have helped to secure it. The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.

A range of pathologies then accompany the disenfranchisement that occurs as the ‘train’ runs faster but leaves an increasing number of the passengers behind on the station.

Monbiot lists the “epidemics of self-harm, eating disorders, depression, loneliness, performance anxiety and social phobia”.

He notes that “neoliberal policies were imposed – often without democratic consent – on much of the world”.

Frederick von Hayek, who loathed anything to do with government intervention spawned the views of Milton Friedman. Von Hayek admitted when Pinochet trampled over democracy in Chile in 1973 that:

… my personal preference leans toward a liberal dictatorship rather than toward a democratic government devoid of liberalism

The freedom that neo-liberalism espouses is a “freedom to suppress wages … the freedom to poison rivers, endanger workers, charge iniquitous rates of interest and design exotic financial instruments … freedom from the distribution of wealth that lifts people out of poverty.”

This abandonment of concern for the interests of the majority is behind the Brexit vote.

As George Monbiot assesses:

Neoliberalism was not conceived as a self-serving racket, but it rapidly became one. Economic growth has been markedly slower in the neoliberal era … than it was in the preceding decades; but not for the very rich. Inequality in the distribution of both income and wealth, after 60 years of decline, rose rapidly in this era, due to the smashing of trade unions, tax reductions, rising rents, privatisation and deregulation. The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income. When you pay an inflated price for a train ticket, only part of the fare compensates the operators for the money they spend on fuel, wages, rolling stock and other outlays. The rest reflects the fact that they have you over a barrel.

The Brexit Referendum finally gave workers a meaningful binary choice – In or Out – whereas general elections these days are a choice between neo-liberal Tories or neo-liberal Labour, that is, no choice at all.

The rejection of neo-liberalism could thus be expressed through this binary choice for the first time in many years.

The workers have been kidded along by the neo-liberal elites including those so-called progressives who persuaded themselves that all would benefit from the deregulation and welfare attacks, when in fact, they could see in the data as they sipped their lattes that while they might be doing okay, a growing number of fellow citizens were being left behind.

The great Polish economist Michał Kalecki (1990, page 284) observed that:

There are certain ‘workers’ friends’ who try to persuade the working class to abandon the fight for wages in its own interest, of course. The usual argument used for this purpose is that the increase of wages causes unemployment, and thus is detrimental to the working class as a whole.”

That became the mantra of British Labour. It has to change.

So why did I think it was great news?

[Reference: Kalecki, M. (1990) Collected Works, Volume 1, Cambridge, Cambridge University Press.]

First, it represents a major rejection of the neo-liberal policy structures that are now commonplace. They no longer have legitimacy and the vote shows that ordinary people ultimately have more power than the elites, who are now scampering around trying to work out how their cosy world can be restored.

This doesn’t mean that the ordinary voter on the Leave side knows what the alternative is or understands Modern Monetary Theory (MMT) or anything else.

It means they have rejected the mainstream.

Second, if carried through, the exit will unambiguously restore British sovereignty and frees it from the austerity-obsessed neo-liberal European Commission and Council. It will no longer be subject to rulings from the European Court of Justice.

The constitutional validity of British legislation, motivated and introduced by an elected British government rather than the unelected technocracy that is the European Commission, will be scrutinised by British institutions (the High Court etc). Which is how a democracy with separation of powers should operate.

Third, the opportunities by the British polity to depoliticise poor decisions which harm the interests of ordinary people by appealing to the external forces beyond their control have been reduced.

British politicians of all flavours will have to take more responsibility for their legislation and policy choices, which is progress on the current state where they can avoid such responsibility by blaming things on Brussels.

Fourth, the choice will not free Britain from neo-liberalism but it does bring the debate back into focus – voter face to face with the British politicians.

There are no guarantees that the decision to leave the European Union will lead to good outcomes, by which I mean help those who have been disenfranchised by the neo-liberal system.

There are scenarios that would lead to the conclusion that exactly the opposite might occur. Indeed, UKIP has every right to claim it ‘won’ and to further pursue its racist plans.

And the right-wing Tories who have always hated Europe might push for even greater ‘competition’ and cuts to government spending and services, which would further undermine the fortunes of the weak and precarious.

Bosses might push for further cuts to wages and conditions.

So why was I happy to see the Leave vote win?

Michał Kalecki also at some point said that in a crisis there are opportunities for both the Right and the Left.

The exit campaign was dominated by those on the Right that could see the potential of giving voice to the disenfranchised outside of the London elites.

British Labour leadership was largely absent throughout – not knowing which way to turn and allowing the Pro-European (neo-liberal) Left elements within the Party to dominate its public viewpoint. It lost its traditional constituents along the way.

The point is that British Labour now has to change drastically and reject its neo-liberal leanings or face extinction.

If it doesn’t show leadership and present a truly progressive alternative to the neo-liberal orthodoxy then the anger will continue and it is possible that the right will dominate.

It is clear that further austerity will be rejected because it is a manifestation of the same sentiments that led to the anti-EU vote.

Brexit vote is a rejection of New Labour as much as it is a rejection of Tory-style neo-liberalism.

I don’t believe all the catastrophe stories that Europe will shut Britain out despite the churlish and childish responses from the likes of Jean-Claude Juncker, the European Commission president, who presumably, in between drinks, told the German ARD television news that Britain should get the f.*k out of the EU as soon as possible and that it would not be an “not an amicable divorce”.

So much for respect for democracy.

Former British Labour MP Bryan Gould wrote in his article (June 26, 2016) – Their Hysterical Reaction Tells Us Why The Remainers Lost – that:

… the Labour leadership missed the chance to place itself at the head of that majority who were fed up with the obvious, serious and growing deficiencies of the EU as a model for European integration. Instead, Jeremy Corbyn – through timidity rather than conviction – placed himself on the losing side and missed the chance to exploit the unavoidable blow to the authority of the Tory government that the Brexit decision represents.

Now British Labour has to emerge with leadership to bring back the disenfranchised into a progressive policy agenda. They have to once and for all reject the Blairite corruption of the Party and expunge those who still hold those views.

If they cannot do that then a new Party has to form.

Such a Party has to spearhead a renewed education campaign to ensure that the Leave vote frustration becomes an informed rather than visceral rejection of neo-liberalism.

It has to demonstrate, through leadership, that full employment is possible and announce a Job Guarantee, to ensure that all workers have a job and wage security.

It has to argue the case that the nation state, which issues its own currency, has all the capacity it needs to ensure a decent paying job that allows workers to be socially included is possible.

It has to prioritise first-class public education, health care, transport etc and if necessary nationalise the railway system again, the energy sector, and protect the NHS.

All these progressive policy initiatives would have been prevented while retaining membership of the European Union.

It has to eschew the neo-liberal myths that it has to impose austerity to avoid running out of money.

Every young kid in school should be taught that the British government can never run out of money, is not subject to the whims of the private bond markets if it does not choose to be, and is never unable to ensure there is enough work for all.

Conclusion

Bryan Gould notes the hysteria from the losers after the Leave victory:

It did not seem to occur to …[those who claimed it was the “equivalent of the Visigoths’ sacking of Rome”] … that the decision to leave the EU was the product of a vote in which a majority of his fellow-citizens had simply, as part of their democratic right, acted on a view, or views, on a subject of interest to the whole community, that were just as valid as, but different from, his own. The barbarians whom he castigated were not invaders from elsewhere; they were Britons like him, enjoying the same right as he had to consider the issues and express a view. It is what is called democracy.

Bryan Gould also discusses the neo-liberal Groupthink in action that promoted the Remain campaign where:

The fury and hatred aroused by the discovery that there was actually a majority that disagreed with those who thought that they alone were capable of reaching the right and proper decision – and the vitriol with which those sentiments are expressed – provides us with an insight into the mentality of many of those who simply could not believe that any view other than theirs was possible.

When I tweeted it was a ‘great outcome’ I didn’t say that good would come out of it. I also didn’t suggest that it would be a short-term recovery of prosperity or that the workers would benefit.

I was referring to the fact that class struggle now has a clearer focus within the British political debate. There is now a dynamic for a truly progressive leadership to emerge and bring the disenfranchised along with them and wipe out the neo-liberal hydra once and for all.

That is why the Brexit vote is excellent. British politics is now in chaos. How it sorts itself out will determine what the outcome leads to.

But progressive leadership now has space to challenge the orthodoxy. That is a great outcome.

It might take time to emerge and crystallise. But class struggle does not yield instant rewards.

But I see the Brexit choice as one of those monumental outcomes similar to the OPEC oil crises in the early 1970s that change the course of history. I do not need to remind anyone that the Monetarists exploited the OPEC chaos to capture undeserved credibility and pursue the neo-liberal agenda.

That is enough for today!

(c) Copyright 2016 William Mitchell. All Rights Reserved.