In the 1975 referendum, one of the leading figures in the argument to reverse Britain’s membership of the EEC was Tony Benn. Benn, for those young enough not to remember him well was an ardent socialist on the Left of the Labour movement, when the Labour movement as a whole was very much more to the Left than it is today. He had renounced a peerage to sit on the green benches, (he inherited the title of Viscount Stansgate on the death of his father), and held several government posts both in the Wilson and Callaghan governments.
In 1975, in the run up to the referendum, he was the Industry minister. He had this to say about the EEC as it was then in a speech made to Cabinet:
We have confused the real issue of parliamentary democracy, for already there has been a fundamental change. The power of electors over their law-makers has gone, the power of MPs over Ministers has gone, the role of Ministers has changed. The real case for entry has never been spelled out, which is that there should be a fully federal Europe in which we become a province. It hasn’t been spelled out because people would never accept it.
We are at the moment on a federal escalator, moving as we talk, going towards a federal objective we do not wish to reach. In practice, Britain will be governed by a European coalition government that we cannot change, dedicated to a capitalist or market economy theology. This policy is to be sold to us by projecting an unjustified optimism about the Community, and an unjustified pessimism about the United Kingdom, designed to frighten us in.
Jim quoted Benjamin Franklin, so let me do the same: “He who would give up essential liberty for a little temporary security deserves neither safety nor liberty.” The Common Market will break up the UK because there will be no valid argument against an independent Scotland, with its own Ministers and Commissioner, enjoying Common Market membership. We shall be choosing between the unity of the UK and the unity of the EEC. It will impose appalling strains on the Labour movement.
What has happened to the democratic argument in Britain over the last 40 years, since Tony Benn made that speech? In the early 80’s the left of the Labour movement remained implacably opposed to continuation of EEC membership. Describing it as Union of the Bosses, very few Labour party figures during those early Thatcher years held any regard for it as an instrument of social enhancement. When in 1988, in his speech to the TUC, Jacques Delors promised a Europe where the power of the Unions would set a socialist ratchet effect, no longer allowing Conservatives to govern with any real power, the Labour movement embraced the newly forming EU.
But that has not been the panacea for the left, and for socialism, that it was expected to be. Rather than introducing a new era of socialist policy to the UK driven by the ratchet of the EU, it simply removed much of the argument for a Labour movement at a national level.
The Labour party, within a few short years, concluded that the domestic argument was lost and injected itself with blue dye in the form of Tony Blair. While there was large scale redistribution under the Labour government of Blair and Brown, the life chances of those born at the bottom of the ladder still stagnated.
Industrial loss was greater under those 13 years than even in the Thatcher era, when the large state industries were destroyed. Wages fell in relation to the cost of essentials because of our exposure to the movement of capital and people. And the Euro gave Germany a massive advantage over Britain as it became more and more depressed in comparison to a free floating potential Deutchmark, creating a mercantilist chain from Northern Europe to Southern Europe, where the only lever for the south to pay its bills was the one it no longer had the power to control – monetary policy. The answer to this was Austerity.
The devastation of the southern EU economies has had a knock on effect in the UK, because in search of work, any of those people displaced from their home markets have come to the one place with an independent monetary policy where jobs can be more easily created – the UK. And while EU immigration in itself has not been bad for Britain in headline economic terms, the rapid rate of demographic change has put increasing strain on the social settlement of the UK, some public services, and has distorted supply and demand balance in our own labour market.
While the EU has reinforced employment rights, it has only done so through the guidance of the International Labour Organisation (based in Switzerland – outside the EU). The real prize has been ignored – high value work and therefore higher wages. As the labour force expands however, it has not become largely higher skilled or higher paid. Those at the bottom are shackled to the minimum wage, simply because it is constantly underpinned by the expanding supply of low skilled labour.
Those with training and education might see less wage compression, but the gap between the haves and have nots opens wider and wider, creating a class of workers who have little stake in the modern British economy apart from their enslavement to debt. This has driven the new emerging lower middle class to protectionist political allegiances, simply put – they are now more likely not to vote Labour if it advocates socialism. Rapid change may be undermining the British spirit of altruism.
The welfare state is constantly under immense pressure. Working age benefits it is argued by the Left, are not the problem, it is pensioner benefits that drain the tank. However, that isn’t the real issue. The real issue is that they are now distorting the way employers behave, because it is no longer a necessity to pay a wage that equates to the cost of living, especially in areas of high workforce expansion. The employers are getting a free ride from government in the form of working Tax credits and housing benefit. So rather than having to compete for workers in a tightening market, they have a steady stream of new labour, subsidised due to the rules on non-discrimination by our own welfare system.
Of course, the workers themselves benefit in the short term, but overall it is the employers, especially the large corporate ones who use large numbers of cheap unskilled workers, who gain the most. These workers are mainly in the service industries, or in contractors serving big business in our cities, or working the fields and food factories in Rural England.
My kids will not be able to get the work that I had as a student, working nights in a vegetable packing plant. They are simply prevented from working due to the Working Time Directive which sets strict and infeasible limits on younger workers, like the 7pm limit. I used to work ’til 10pm, 5 nights a week. By the time I was 18 I had a car, college education and savings, and at 19 I was living independently in my own flat. My kids will have none of these things. I also had references, and real work experience, which made it easer for me to get a job and be mobile in the labour market – I could actually take a decision to quit a job for another one because of it, an almost unheard of luxury now. The bottom rung of the working ladder has been removed, at least in part, by EU legislation.
And what of Big Business? Has the EU held it in check? It would appear not. Starbucks was able to use the EU rules on free movement of capital to house large parts of its financial operations in low tax EU states, where little of its wealth was created. The UK treasury has to go cap in hand to them on ‘moral grounds’ and still recovers only a small proportion of what is really owed. Google do the same, as do most large international corporations. It is no surprise then to find that the designer of the Luxembourg tax system is one Mr Jean Claude Junker, now the president of the European Union Commission.
As the modern Left wheels out big business leaders to argue the economic case, it should stop and think again about why they are in favour of EU membership. Since when was it the cause of the socialist to argue for the rich to be able to rig the system for their own ends? There are apparently 30,000 lobbyists in Brussels alone (ten times more than the number of direct EU employees apparently). They aren’t there for the mayonnaise or the chips.
Brussels is the lobbying capital of the world – where big business gets to make its case to the bureaucrats, away from the prying eyes of the national press which only vaguely understands what happens there. Every time that a new piece of legislation goes through, the big businesses that are cheerleaders for it can absorb it as a small cost in their very large structures. The little guy at the bottom often cannot. In this way then the EU has become the last bulwark of Corporatist protection, in practice making entry to many markets more difficult for entrepreneurs.
The EU also acts as a customs union, which in some respects does insulate some sectors from under priced competition and dumping. But it takes a great deal of time to move rates of tariff and get agreement at the Commission level. As an independent nation at the WTO, the process takes 30 days.
At the same time, our trade with Africa and the way that this has repressed the growth of the developing world is also an EU issue. Africans recognise the one sided and dominant deals that we strike there, affecting fisheries and agriculture markets and opening up their fledgling markets unfairly to competition from well-developed corporations. At the same time, the Common Agricultural Policy misdirects EU funding on a large scale, which also makes it difficult for African farmers to compete fairly while raising the price to the customer here. It is in Britain’s interests for Africa to be rich, but the EU is holding back African prosperity.
What of the public/private ownership balance? The form de-nationalisation of key industries has taken place has been shaped by the European Union directives. For example, the method used for privatising the railways network was driven by First Railway Directive – the EU drive to separate ‘Wheel and Steel’. It hasn’t been a very effective policy. In postal services, the same thing has occurred, with the Third Postal Directive. This forced liberalisation of the market at an EU level was delivered to you for the benefit of DHL and TNT, threatening the national viability of a universal postal service in the UK permanently. Remember when you used to get your letters before you left for the office? Remember when you could send a letter in Truro at close of business and it would be delivered in Aberdeen before the start next day? The EU does not like state monopolies, even when they work for the benefit of the people.
At the same time, while it is possible for British industry to be nationalised, even in public hands it cannot always be run at a non-commercial loss, even for the social interest of the public themselves. The steel industry is one area where the rules on public ownership and subsidy run deeper than the general rules.
And take a moment to consider this fact: No other European Union Nation has a fully publicly owned health service on the same model and scale as the NHS.
Looking at the steel industry, and the scandal of vehicle emissions, it is clear that EU obsession with Carbon and Carbon emissions at the detriment of most other concerns has simply been wrong headed. Rather than reducing the world carbon level, it has simply exported pollution to the third world. Energy costs have driven British industrial producers abroad much more than labour costs or employment protections. The rush for gas and diesel has distorted the energy market to the detriment of the consumer, left the coal industry in the UK in ruins. It has led to diesel polluted cities, the further loss of heavy industry, unemployment and energy poverty.
The EU is now negotiating its trade agreement with the USA – TTIP. The details of it are rather sketchy as such negotiations are always carried out behind closed doors. But one area that has received public attention is the Investor State Dispute Settlement. On the face of it, this creates a court system outside that of the national structure of justice, which will hear disputes between Corporations and States over market access and contract issues. Its findings and deliberations it would appear, will not be public. This runs counter to hundreds of years of English (and British) Jurisprudence.
Civil cases are held in public in the UK (unless there is a particular reason for secrecy, and legitimate reasons are very narrow). This would be a very important principle to maintain, especially as if you have no idea what cases have been brought, how can we have any confidence in the reasons our politicians tell us of why they make decisions when it comes to industrial policy? Are they doing our democratic will, serving their own interests, or are they compelled in secret by a court with no UK oversight? It does not seem to offer transparency.
Leaving the EU will not in itself bring about Socialism or social change in Britain. But restoring democratic legitimacy to the UK will at least return the impetus to our own voters, politicians and national structures. Tony Benn was right about democracy. And so was Niall Fergusson when he called it one of the ‘killer apps’ in economic development. Surprising then that he is a keen supporter of the EU, which has a parliament that does not propose legislation, and an executive that is not elected. It is a parliament of no independents, as they cannot speak in it and cannot be elected to it under a party list system. It has none of the safeguards that our own parliament offers in terms of access by the People. It is simply not democratic. Exactly as Tony Benn told us 40 years ago.
I am not a socialist, more a pragmatist of no particular political parantage. But I am a democrat. I do not want to live in a post democratic society. I would rather see policies I opposed implemented here by the majority will of the British people than those I supported enforced by diktat of an unelected elite with whom I agreed. I would hope that Socialists will feel the same way, and be ready to fight for the right to shape the nation of Great Britain by appealing to its people, and to its people directly, through the greatest weapon of change known to man:
The ballot box.
The views expressed in this article are that of the author and do not necessarily reflect the views of Conservatives for Liberty