The EU and Democratic Control of Capitalism

21 Jun

I am extremely busy at the moment, finishing my book and giving talks in UK, but I just wanted to write something short in support of the UK remaining in the EU.

My view is that the essential problem of our age is a crisis of sovereignty:

Although in many countries (imperfect) democracy has been achieved at a national level, global capital runs the show at a global level.

Countries are not free to set tax rates and regulation as they choose, because multi-national corporations pit nation and against nation in a race to the bottom. Our economic sovereignty has been handed over the market. The only way to reverse this trend is international co-operation, though institutions such as the EU. The forces of aggressive international tax competition keep economically feasible tax rates artificially low. If countries were to co-operate rather than compete –what I call ‘fiscal solidarity’ – we could eliminate these forces, ensuring a vastly greater proportion of profits go to schools, hospitals, infra-structure and education.

It is true that this is not the direction the EU is currently going in, but visionary economists such as Thomas Picketty (in particular read this manifesto) and Yanis Varoufakis are campaigning for such a radical re-imagining of the EU project. We should remain in and fight for this vision.

In the aftermath of the second world war Europe and the US took small but significant steps moved towards the democratic regulation of capitalism, including (relatively) high income and business taxes and strong regulation of markets. It worked, and lead to the most rapid period of growth experienced in human history, the so-called ‘golden age of capitalism’. People got richer, society got more equal, the 60s happened.

Then came the Thatcher/Reagan ideology. The idea was that if we set capital free by cutting taxes and regulation, we’ll all get richer. The result was huge inequality, mass homelessness, and a string of financial crises culminating in the crash of 2008. The Global Financial Crisis should have been the decisive end of uncontrolled capitalism, just as the fall of the Berlin Wall signaled the end of state run communism in 1989.

But the lessons of the crash were not learned. And we are now living in scary times with people flailing wildly looking for answers outside of the mainstream, from UKIP to Golden Dawn to Donald Trump. The only solution in my view is to revert to the project of the post-war period: democratic control of capitalism. This project requires a radically re-imagined EU. A long shot, but I can’t see any other way forward.

This is why I’ll be voting remain.

One Response to “The EU and Democratic Control of Capitalism”

  1. Adrian June 23, 2016 at 8:43 pm #

    Concerning brexit, I don’t understand why you hope that a super-national structure like EU will somehow manage to control global financial interest… what would be their motivation to do that? From what I see, Brussels bureaucrats behave like some religious cult that lost contact with reality, they keep chanting the same incomprehensible mantras, they speak the same neocon language with the white collar mobsters, they drive around in luxurious cars, they stay at exclusive hotels, they are a transnational group of individuals who live the good live without having to do any actual work. As such, they are fully compatible with big business, in Romania we even have a government of such european “technocrats” who assume as a merit coming from corporate environment. Useless to say this government is a catastrophe, the president who appointed it felt the need to take a distance by declaring “this is not my government.”

    Throughout Europe they slashed workers rights, cut public spendings, they managed to blackmail the Greeks with threats like confiscation of their bank accounts. With the british referendum, the most senseless and absurd lies were propagated, like for example the definitive character of brexit, once out re-admission will not be possible any more. But how can this be when UE is obviously dying to have UK? What can happen in the future to completely change their mind about it? In the same way the Scots were threatened with being excluded, expelled, excommunicated, surrounded with barbed wire and left at the mercy of Providence. In my own country nationalism is equated with national-communism and relegated to the extreme left.

    Why are these people so afraid of national values? Could it be that their own ideology is individualism, a position that is neither right nor left but simply asocial and by that antisocial? To explain, everybody agrees political left is socially oriented, like caring for the children with education programs, providing for the sick and old with hospitals and state pensions. But the traditional right wing values can also be seen as communitarian, the positive affirmation of national identity is in fact an affirmation of group affiliation, the religious values are community driven, freedom to produce and trade goods is a collective right, historically this freedom collided with individualism and arbitrary in the form of feudal privileges. When all traditional right wing values are discarded all that remains is a sterile analogy state – private company, which will never stand for obvious reasons.

    The social character of both left and right positions can be derived from the social nature of human consciousness, from an evolutionary perspective individualism is preposterous, the harshest punishment in a tribal society was expulsion from the group which meant certain death. So why not consider movements like UKIP and Golden Dawn or people like Donald Trump as honest, constructive right wing manifestations, naturally opposed to big money interest? If you live in Budapest you should know that Victor Orban, who is seen as fascist by politically-correct propaganda, implemented some very interesting measures against the bankers and in favor of the working man.
    Who knows, maybe a future solution to the Hard Problem would expose the inner workings of human consciousness, would explain why roughly 50% of people lean towards left and right respectively, and why are the right views more susceptible to individualism, why are they easier to hijack by the white collars.

    Sorry for writing this long and for the English spelling, I’ve seen you on YT on the Greenland boat making the essential distinction between physical science and a materialistic philosophical position. The denialists didn’t liked that at all 🙂

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