by Jerome a Paris
Mon Mar 6th, 2006 at 07:39:05 AM EST
This is the first installment (well, the second if you count this comment) in what I expect to be a long running series whereby I will take one press article and flag a number of hidden assumptions that have their base in ideology and not in facts.
The underlying rationale for this exercise is explained in this story: Our Words vs Their Words. Feel free to do your own (ideally in comments below) if you see other articles worth it. Also, I think we need a catchy title for that series, so all suggestions welcome.
Today's article: Ghost of August 1914 spooks EU from the Observer/the Guardian.
During the decades before Britain finally joined the Common Market we were the driving force behind the formation of the European Free Trade Association, or EFTA, as it was generally referred to. The Common Market, or European Economic Community, was known as The Six, and the EFTA members (principally Britain and Scandinavia) as the Seven. Yes, many a time when Europe seemed to be in disarray, there were jokes about it being 'at Sixes and Sevens'.
EFTA was seen by some of the British as a free-trading alternative to the very political EEC. There were those who thought we should never have to join the EEC, but in the end it was felt that although the EEC was at heart a political project, it was doing a lot better economically than we were, and if we couldn't beat them we had better join them.
I find that casual acknowledgement that the EEC was "at heart a political project" amazing, as it has been systematic UK policy to deny that the EEC or the EU ever had any political content.
Note how the "political project" is opposed to the "free trade alternative", despite the EEC being built specifically as a free trade zone. Of course, it was not only a free trade zone...
Nevertheless, successive British governments remained dubious about the politics of what became the European Union (EU). Our support for broadening or widening the EU - 'enlargement' - was rightly seen by many of our continental neighbours as part of a Trojan-horse operation to undermine the long-term aim of 'ever closer [political] union'.
Note the even more casual note that UK policy was indeed to sabotage the project, and that enlargement was a great way to do that.
That point is still denied officially. Is it nevertheless common wisdom for everybody in the UK?
What had prompted Mrs Thatcher to support the single market was the hope that Thatcherism could be exported to mainland Europe. The possibility that a free-trading single market would involve a single currency simply hadn't occurred to her and was a nasty shock.
To judge from the experience of recent years, the broadening of the EU has indeed contributed to the undermining of the political project. In a sense, the EU is the embodiment of Robert Louis Stevenson's observation that 'To travel hopefully is a better thing than to arrive'.
So there's the answer: despite the euro "scare", it is mission accomplished. Thatcherism has conquered the continent; the inconvenient inconsistency that monetary sovereignty is just another form of protectionism was conveniently swept under the carpet, and the other Europeans could safely be accused of being "nationalists" and "protectionists" when they refused other features of the free markets mantra...
Spain, Portugal and Greece all shook off the malign shackles of fascist dictators en route to membership of the EU. Aspiring members have to behave. Once they are in the club, they can squabble and quibble like the rest.
Enlargement has certainly complicated matters. One of the main purposes of the ill-fated constitutional treaty last year was to streamline the workings of the EU to enable it to cope with enlargement.
Unfortunately the referendums coincided with the surfacing of a huge sense of insecurity on the part of the electors of France and Holland - an insecurity resulting from the high unemployment and associated fears of the threat to jobs brought by 'globalisation', and immigration from eastern Europe - the latter epitomised by the supposed threat to jobs from 'the Polish plumber'.
Why is it "unfortunate" that the referendum failed if the treaty was "ill-fated"?
Note also how Holland is tarred with high unemployment en passant (the Economist has it at 6.2%, down from 6.6% a year ago).
Note also how UK hostility to the treaty was based on national pride or refusal of needless bureaucracy, whereas the French or Dutch kind is "insecurity"...
and the usual insecurity/unemployment/France vs globalisation/immigration...
This threat is linked with the extension of the single market from 'goods' to 'services'. And, ironically, we can see the latest outburst of protectionism in the European energy sector as a consequence of moves towards a 'single market' for energy.
Suddenly, there is a vogue in France and Spain for 'national champions', in response to threatened cross-border takeovers from corporations or public utilities in other EU countries.
"Suddenly, there is a vogue in the business press for the word protectionism." France has ALWAYS explicitly favored national champions (or French-controlled European ones), and Spain has also de facto done the same for a long time.
What's new is not that fact, it's the reaction to it. That "suddenly" speaks volumes about the fact that we have a recent campaign launched on this topic, which I personally date to the European Parliament vote on the service directive, which is seen as a massive failure by the Mandelson/Barroso/etc camp - and that's why it makes sense to fight it now as well.
Protectionism in the energy sector arises primarily out of uncertainty about the security of supply. Paradoxically, the bureaucrats and an earlier generation of politicians had aimed at 'European' solutions to the putative threat from 'globalisation'. But along comes a revival of fundamental concerns about security and survival, and nationalism rears its ugly head - the very nationalism it is the political purpose of the EU to eradicate. As Germany's Angela Merkel asked rhetorically: 'Why are senior Chinese ministers travelling only to countries with oil and gas?' And the Italian deputy PM Giulio Tremonti says, rather dramatically: 'The tendency of European states to build protective barriers must be stopped...If not we risk an August 1914 effect.'
The political purpose of the EU is dead! You killed it, as you wrote above... Those politicians that were willing to subsume the national interest into a higher Europeen entity/identity cannot do so anymore, and fall back to what remains to create effective political control over corporations: the nation State.
That's the enemy, isn't it? Political oversight over corporations. It's been fought off successfully at the European level, and now the fight is brought once again at the national level, this time with the help of the Brussels bureaucracy. Just as Bush is twisting the federal US bureaucracy for the narrow purposes of his class, thus the neoliberals are trying to do the same in the EU.
Thus the need to tar national governments with "nationalism", "1914" (they will cause war! they are betraying Europe!), "protectionism" against waht is only a "putative" threat...
As to the Italian comments (in that I mean from a senior member of the Berlusconi government), it tells us more on those who take them seriously...
Is this inevitable? Is there nothing that economic policy can do to alleviate the prevailing sense of insecurity? Feelings of insecurity about supplies of energy will be assuaged only by determined efforts at the national and international level. Plainly, invading Iraq has not achieved the purpose of making energy supplies more secure. (A Canadian in Davos recently joked that his country was lucky US vice-president Dick Cheney did not invade Alberta, where the high price of oil has made extraction from the tar sands economic).
The prevailing sense of insecurity is the MAIN GOAL of current policies. Why should they alleviate it? They create it and thrive on it. So the goal must be to make those feelings of insecurity invisible, isn't it? Then they can be ignored and victory and prosperity officially declared...
And note the small dig at Cheney critics (who see oil&gas conspiracies everywhere).
But one area where the policymakers of the eurozone could make people feel more secure is by gearing their economic policies towards expansion and low unemployment, rather than towards fighting non-existent Weimar inflation. With only the most tentative signs of buoyancy in the eurozone economy, the European Central Bank went ahead last week with its well-advertised plan to raise interest rates. A central concern of the ECB's is the growth of the money supply - a concern which even Professor Milton Friedman, the godfather of monetarism, has now abandoned.
Again the complaint that the ECB is rigid and focused on inflation. Totally untrue, and a convenient way to explain away the consequences of the kleptocratic policies: it's the fault of the evil central bankers (and the terribly rigid Germans, with their misguided focus on the horrors - their horrors, a subtle reminder - of the last century), not of the said policies.
And of course, focus on money growth should now be abandoned, as it would of course show that the current policies are based on one giant bubble made from cheap money, thanks to God (sorry, Greenspan).
The ECB, and other eurozone policymakers, seems determined to knock economic growth on the head before it can bring unemployment down to more tolerable levels. They are obsessed with the 'sustainable' rate of growth, or productive potential, which they put on the low side. But all experience suggests that if there is high unemployment and 'slack' in an economy, a period of above long-term average growth is required.
"Sustainable growth"? What a crazy concept, which prevents companies form making more profits now! It must be eradicated as stupid, "rigid", and the cause of unemployment. It's time to party and to give nice fees to investment bankers and other city professionals instead of plodding along!
Such a policy seems ruled out by definition in the eurozone. This could turn into a calamity, and compound Europe's sense of insecurity.
Europe = the eurozone = calamity = unsecure.
A fitting conclusion.