SocialismToday           Socialist Party magazine

Issue 230 July-August 2019

What now for Brexit?


Three years on from the referendum over the UK’s membership of the European Union the ruling classes of Britain and Europe have still not found a way to deal with the seismic consequences of the June 2016 vote to leave the bosses’ club.

The overwhelming majority of Britain’s capitalists wanted to remain within what is the largest common regulatory market in the global economy (in GDP terms), integrated into European supply chains and with a place at the rule-setting table. The ruling classes of the 27 other EU members also wanted Britain to remain, not least from the fear that the process of renegotiating economic and legal-political relations established over 46 years with a country responsible for 16% of EU GDP would encourage new clashes of interests to emerge between the club’s different capitalist nation states.

Their expectations, however, of a remain victory to ‘put the EU question to bed’ were thwarted by what was, at its core, a working-class revolt against the capitalist establishment and the age of austerity ushered in by the 2007-08 financial crash. A new equilibrium is far from being achieved as a new global economic slowdown, and new crises for the EU project, loom.

Meanwhile, a second Tory leader has been toppled by the 2016 reverberations and the mercurial Boris Johnson now seems set to become prime minister. He has pledged that Britain will leave the EU by the new Brexit day of 31 October ‘with or without a deal’. Equally likely, if not more so, is a continued fragmentation of the Tory party and a deepening parliamentary paralysis. A general election by the autumn is inherent in the situation, against the backdrop of global and domestic turbulence – and the possibility, then, of a Corbyn-led government.

Heading for no deal?

If there is not a withdrawal treaty agreed by 31 October the default position is that the mutual obligations between Britain and the remaining EU27 countries codified in the current EU treaties will no longer apply at that point, a ‘no-deal’ Brexit. To obtain a further extension – the October deadline is a re-set of the original 29 March date decreed by the EU’s Article 50 rules – the UK government needs to request one, and an EU summit agree to it and its terms unanimously.

Undoubtedly, there is scaremongering involved in some depictions of what a no-deal Brexit could entail, but Johnson’s breezy insouciance severely underplays the consequences for British capitalism of an acrimonious breakdown. His assurance during the BBC Tory candidates’ debate that he would “get a standstill in our current arrangements under GATT 24, or whatever it happens to be (sic)”, was contradicted the next day by the Bank of England governor Mark Carney. He pointed out that this World Trade Organisation authorised procedure only “applies if you have an agreement” for a proposed trade deal, “not if you’ve decided not to have an agreement or have been unable to come to an agreement”.

More accurate in terms of the likely economic consequences was the 1,477-page schedule of provisional tariffs in the event of no deal published by the government in March. This would see levies applied to nearly one-fifth of imports from the EU (from zero at present). It was denounced by Confederation of British Industry director Carolyn Fairburn as “the biggest change in terms of trade this country has faced since the mid-19th century”. She complained, moreover, that it had been drafted “with no consultation with business”.

Other no-deal planning by the UK government, for which over 16,000 civil servants have been recruited or redeployed, includes the establishment of 43 Local Resilience Forums, some led by senior police officers, to deal with disruption to transport, healthcare services and food and water supplies, and ‘public disorder’. On the other side, a leaked diplomatic note from March showed EU27 ambassadors – anticipating that the British government would seek emergency ad-hoc arrangements within days of a no-deal crash-out “to ensure the vital lines and procedures needed for the UK economy to survive” – setting out the conditions they would insist on in return.

These included the demand that Britain must pay the £39 billion divorce bill even without a withdrawal agreement, a sum Johnson has demagogically threatened to withhold. While the working class takes no responsibility for ‘commitments’ to the EU bosses’ club made by capitalist politicians, from the standpoint of British capitalism, not fulfilling treaty obligations would damage its reputation internationally – if they can renege once they can renege again. It would have severe consequences, not only in the immediate period after Brexit, but for future treaty negotiations, trade agreements, and the cost of government borrowing.

The reality is that an acrimonious exit would see the position of British capitalism much diminished, at a time when global economic tensions are heightening and world relations strain. All this points to the pressures on a Johnson premiership to avoid an October crash-out. But that is easier to prescribe than to achieve.

Boris the Brief?

As Johnson and the present foreign secretary Jeremy Hunt were announced as the final Tory leadership contenders, Irish prime minister Leo Varadkar pointed out that “both of the two people that are now going forward to the members of the British Conservative party actually voted for [Theresa May’s] withdrawal agreement and they did so only a few weeks ago. I think that is something worth bearing in mind”.

Rumours swirled during the MPs’ part of the leadership contest that Johnson supporters had voted tactically to eliminate, firstly, the hard Brexiteer Dominic Raab, then Johnson’s fellow 2016 Vote Leave campaigner Michael Gove. This was to make it easier for him to take a more evasive line on Brexit in the hustings against a remain supporter like Hunt. The hope, expressed by remainers-for-Boris supporters, is that Johnson could deliver a version of the current ‘Brexit-in-name-only’ withdrawal agreement, with suitable cosmetic amendments. The historical analogy is with Charles de Gaulle, who seized power with the backing of French Algerian colonialists in 1958 only to preside over Algerian independence in 1962.

The EU27 countries have, so far, maintained a unified position that the 585-page legal withdrawal treaty is not up for renegotiation but that the more ambiguous, non-binding political declaration could be recast. They do not wish for a disorderly Brexit or for ‘Brussels’ to be blamed if the whole process collapses. Changes of little substance, however, are unlikely to satisfy the hard Brexiteer European Research Group (ERG) of Tory MPs. De Gaulle faced assassination plots from the abandoned colonialists which, of course, are not in prospect here. But asked what would happen to Johnson if his commitment to the October exit date wavered, one Brexiteer told The Guardian: “The same thing that happened to Theresa May, only a lot quicker”. (20 June)

In this the ERG is only reflecting how dysfunctional the modern Tory party has become from the point of view of the capitalist class. In the 1950s, the Tories had over two million members, showing the social reserves this vehicle of capitalist political representation rested on. Even into the early 1990s, it had a membership of over 400,000.

Membership has increased by 30,000 or so since the last figure of 124,000 members released by Conservative Central Office in March 2018, but they do not represent the majority of Britain’s ruling class or even a broad social base. One-fifth live in the South East and nearly 40% are aged over 66. A recent YouGov survey found that 61% would prefer “significant damage to the UK economy” to Brexit not taking place. A similar percentage would see Scotland leaving the UK as less important than achieving Brexit, while 54% would rather “their own party destroyed” than Brexit abandoned.

On the other hand, Tory remainer MPs have threatened to support a parliamentary no-confidence vote against a Johnson premiership if a no-deal Brexit is pursued. Defeated leadership candidate Rory Stewart has argued that the “short-term pain” of splitting the Tory party would be a price worth paying to prevent a crash-out. The present Tory chancellor, Philip Hammond, demob-happy as he faces the axe in the new regime, pledged at the Mansion House banquet to “fight, and fight again”. He raised the need for “other democratic mechanisms”, including an election, “to break the impasse”.

Johnson may be tempted to go for an early snap election to try for a ‘personal mandate’ to pre-empt the inevitable implosion. In any event, he could end up beating the record – 119 days for George Canning’s 1827 Tory administration – for the shortest premiership in British history.

The Corbyn factor

Responding to Stewart’s comments, the recent chair of the Tory backbench 1922 committee, Sir Graham Brady, warned against “a catastrophic split in the Conservative Party at a time when the opposition is led by dangerous extremists”. (The Telegraph, 6 May) The prospect of a Corbyn-led government is almost the only glue holding the Tories together.

Historically, even when Labour was a ‘capitalist-workers’ party’ – with pro-capitalist leaders but channels for the working class to fight the leadership, particularly through the trade unions – the ruling class was prepared to rest on a Labour government as its ‘second eleven’. A right wing-led Labour government could act as a shield for the capitalists, providing them with a means by which they could attempt to secure workers’ acquiescence to their vital interests.

Nonetheless, the dual character of the Labour Party then meant that it always presented a latent danger for the capitalists, a potentially unreliable tool. That is why, prior to Tony Blair’s transmutation of the party into the completely capitalist New Labour, previous Labour governments – in 1924 and 1929-31, and 1974-79 – were tolerated but simultaneously undermined and eventually brought down by the capitalists. Under Blair the attitude was different, with New Labour effectively the first eleven. Even though Jeremy Corbyn has failed to complete the overturn of the ideological and organisational legacy of Blairism to transform Labour into a mass socialist workers’ party, the ruling class looks on a Corbyn-led government with profound trepidation.

Not only in a general sense: because a Corbyn victory would give enormous confidence to the working class, whetting its appetite for a broader struggle including support for clearer socialist ideas. Also specifically: because he is not a reliable defender of capitalist interests on the EU and Brexit.

Jeremy Corbyn campaigned in the 1975 referendum against the European Economic Community (before it was renamed the EU) and voted as a backbencher against neoliberal European treaties. Although he made a significant retreat in his first concession to the Blairites on his election as leader in September 2015 – when he committed to support a remain vote in the then forthcoming EU referendum in all circumstances – he has not capitulated to their demand to overturn the referendum result.

Even when he has spoken of the possibility of a second referendum he has ruled out a repeat of that vote. In Dublin in May, he said: “We don’t back a rerun of 2016. That happened. That is gone”. He added that he could reach a better withdrawal agreement with the EU which could then be put to a vote, “if parliament wishes it”. As The Guardian commented, this position leaves it open for Labour to “campaign in favour of a Brexit deal in any second referendum, rather than for the option of remaining in the EU” (31 May), or at least Corbyn and his supporters, in the same way Labour cabinet ministers stood on different sides in 1975.

It is to avert this possibility that the clamour is growing from the Blairites and the establishment media – “obsessed with defining everybody by how they voted three years ago”, as Corbyn said to the BBC’s Andrew Marr (19 May) – for a so-called ‘people’s vote’, not a general election but a second referendum.

The people’s vote clamour

Some Blairites want to stop Brexit and see a second referendum as the means to do so. This was the policy of Owen Smith, while claiming to be “as socialist as Jeremy”, in his leadership coup attempt against Corbyn in 2016. That some lefts like the journalist Paul Mason have now adopted the same stop Brexit position is a reflection of the broader evolution of such figures away from socialist ideas in a complex political conjuncture (see the article by Peter Taaffe reviewing Paul Mason’s latest book on page 15).

Other exponents of a people’s vote, however, do not necessarily see this any longer as a realistic proposition. Reversal referendums have been used to overturn results where the vote had gone ‘the wrong way’, from the capitalists’ point of view, notably in Denmark to agree the 1992 Maastricht treaty, and Ireland (the 2001 Nice and 2008 Lisbon treaties). But these are different times, over ten years into the age of austerity.

There has been no unambiguous shift in opinion since 2016. May’s European elections were presented as a victory for remainers, with the combined 6.14 million votes for parties committed to revoking Article 50 – the Lib Dems, Greens, Change UK, Scottish National Party, and Plaid Cymru – marginally ahead of Nigel Farage’s Brexit Party and UKIP. To put this into proportion, 6.14 million represents only a slight increase in support on the 5.78 million who signed the parliamentary petition in March to revoke Brexit. Most fundamentally, two-thirds of voters, over 30 million people, didn’t turnout at all.

Another measure came in the Britain Thinks poll in April showing that 83% of people are “sick of seeing Brexit on the news every day”, and that 64% believe “the attendant anxiety is bad for people’s mental health”. It also showed that, while 39% backed cancelling Brexit as a way to end the agony, 46% backed leaving with no deal to achieve the same end. A rerun referendum – the capitalist establishment telling working-class leave voters they were wrong – would not be guaranteed to result in a Brexit reversal.

Nonetheless, the people’s vote propaganda still has its purpose, above all within the Labour Party. It provides an allegedly ‘progressive’ cover for the right wing – deputy leader Tom Watson claims to “support the EU because I’m a socialist” – to build its base to move against Corbyn’s leadership when the time is right, either to sabotage a Corbyn-led government or form a new party. Combating these agents of capitalism within the workers’ movement is the duty of every socialist.

These are volatile times. The Euro-polls were followed by the Peterborough by-election in which Labour held off the Brexit Party in a leave-voting city that, significantly, had seen average pay shrink by 13% in real terms since the crash. Class issues cannot be so easily buried. The Tories’ Brexit travails are creating new opportunities for the workers’ movement and must be met with a clear programme for a socialist and internationalist opposition to the EU bosses’ club.

Editorial duties

Socialism Today’s founding editor, Lynn Walsh, has stepped down after a period of declining health. Lynn was appointed by the Socialist Party’s executive committee as the editor of Socialism Today from its inaugural edition, published in September 1995, to issue No.228, produced in May this year.

Regular readers will recall, especially, Lynn’s outstanding contribution to developing a Marxist analysis of the world capitalist economy, within the wide-ranging spread of articles he wrote on geopolitics in the post-Stalinist era – in particular, the foresight shown in the period preceding the crash of 2007-08. But all the articles on every subject in the magazine benefited from the input they received under the keen eye of its editor. Sadly, however, it is precisely the aggravation of long-standing problems with Lynn’s eyesight that means he is no longer able to participate in the editorial work.

Lynn was also the editor from 1989 of Militant International Review, Socialism Today’s predecessor magazine, although published less frequently than the ten issues a year monthly schedule (excepting January and August) that Socialism Today has maintained now for 24 years.

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