Brexit, Social Europe and the “Social Democratic Deficit”

Shayn McCallum

Brexit, the long-dreaded and/or -anticipated event that some of us believed would never actually happen, has come to pass. History has been made and we will all have to live with the consequences, whatever they may be. The image of the EU as a kind of Hotel California from which no country, having entered, could ever hope to leave has been decisively shattered. Whether we like it or not, the game of European integration has changed forever and what was once considered unthinkable may be reevaluated, with the benefit of hindsight, as having been inevitable.

The era we are living in has many parallels with the years in between the last century’s two world wars, the last great interregnum. Indeed, a quick re-read of Karl Polanyi’s investigation of the politico-economic origins of that era, The Great Transformation, reveals a number of compelling themes that directly parallel those of the era we are living in. Just as we witnessed in the decades following the end of the Cold War, the late 19^th and early 20^th centuries were characterized by the hubristic pursuit of a global, free-market economy. Just as speculative finance capitalism brought about the Great Depression of the 1930s, the same spread of uncontrolled transnational financialization of the economy in the closing decades of the 20^th Century delivered us the meltdown of 2008 and the interregnum in which we have been living since.

In the 1920s, the golden straitjacket that restrained any attempt to pursue radical solutions to the social destruction wrought by financial collapse was, quite literally, gold itself as the gold standard created an objective limit to any single country’s ability to employ monetary policy. The idea that any country could simply unilaterally toss out the gold standard altogether and pursue its own independent economic and financial policy was unthinkable across the political spectrum – right up until it suddenly became reality. Once the German Reich under Hitler had done the unthinkable, every other country rapidly followed suit, creating a new, terrifying era of militarised, economically nationalist states that would lead the world into a second world war.

The current situation is not quite as dire as that of the 1930s. Britain’s exit from the EU was undoubtedly a victory for right-wing populists but it would be quite a stretch to imply that Nigel Farage’s half-baked nativism in any way resembles the jack-booted, organized militarism of fascism or National Socialism. The 1930s were a tragedy which has much weaker echoes in the farce facing the EU today. We may not be dealing with 1930s-style full-regalia fascism just yet but the decision by just over half of the UK citizenry to turn their back on European integration needs to be understood as a major wake-up call, particularly for the social democratic parties.

Although the pro-Brexit campaign was run largely on issues of migration and a vague sense of “reclaiming national sovereignty,” at its heart it was a cry of despair from an increasingly embattled society suffering the centrifugal pressures of neo-liberalism. Neo-liberal globalisation has, directly and indirectly, created the fear and sense of insecurity that the right-wing populists have fed on. Sadly, social democrats, who ought to have seized the moment, right back when the crisis broke, to push for a new deal for European societies and a meaningful alternative to austerity and technocratic governance (a problem every bit as relevant to national governments and economies as to the institutions of the EU) have proven largely incapable of responding adequately to the very legitimate fears of ordinary people. Social democracy apparently suffers from the same popular perception of being an out-of-touch elite as the EU itself.

Social democrats have overwhelmingly been active partisans of European integration. In fact, on the whole, the PES parties may very well be the most consistently pro-EU bloc in the European parliament. Unfortunately, many of the arguments advanced by the Left in favour of the EU have fallen on deaf ears. This is not difficult to understand when the recent behavior of the EU is examined. It is hard to argue for a progressive vision of “Social Europe” when this is nowhere in evidence. Moreover, given the EU handling of Greece, it is not at all difficult to portray the EU as a heartless, technocratic organ which favours the interests of its strongest members and disrespects the democratic wishes of its weaker members. Things may, in reality, not be so simple, but politics runs as much, if not more, on emotions and perceptions than on logic and dispassionate reasoning.

The argument for Social Europe, to be meaningful at all, needs to be based on a serious democratic reform of the EU itself. The EU, as it stands, has failed a major PR test and Brexit may well be the thin edge of the wedge. One response aimed at attempting to reclaim the Spinellian dream of a federal, socially just European union has been taken up by Yannis Varoufakis and the DIEM25 movement which he founded, based on the idea of a “new deal for Europe”. Similar visions have been proposed by organisations such as Compass in the UK. Yet, it is all too painfully clear that these movements for reform remain weak and less visible than the Eurosceptic populists with their simple cry of “exit”. The lack of any meaningful support for radical reform of the EU from the social democratic parties, much less any effort at organizing on this basis, has meant that social democracy is simply following rather than leading the public debate. The arguments, which are dividing social democrats themselves, turn on whether it would be better to embrace populist euroscepticism as a rejection of neo-liberalism or defend membership on the basis that, in the long run, this strategy will eventually deliver progressive outcomes.

It is at this point that it is worth pointing out some of Thomas Fazi’s recent arguments both in criticism of Varoufakis’ federalist aspirations and, quite controversially, in favour of Brexit. Fazi wrote a compelling book in 2014 advocating democratic federalism, however, the events following the Greek “Grexit” referendum, have led him to change his position to one of euroscepticism. At the heart of Fazi’s critique is the idea that the real issue being overlooked, especially by the Left, is the need to reassert democratic sovereignty over the economy and end the hegemony of organized capital. As he points out, the arguments around Brexit have obscured this underlying element. If the Left is to have any impact on the discussion it needs to make this case, otherwise we will remain ineffectually trapped between Eurosceptic populists on one side and neo-liberal technocrats on the other.

The logic of Thomas Fazi’s conclusions, however, potentially leads to the break-up of the EU and, although the reasoning behind his article advocating Brexit is compelling, there are, in fact, very good reasons why the Left needs to double down on its efforts to defend European integration. For one thing, although globalisation is not the apolitical, inevitable, evolutionary process it has been claimed to be, it has become a reality that must be taken seriously. The idea that some kind of “social democracy in one nation” can be constructed in a world where economic processes have become so deeply integrated is an extremely improbable fantasy, as the UK is no doubt soon to discover. Although the EU as it stands is no shield against neo-liberalism, this only highlights the urgent need for a campaign from the Left to reform it. The ability of a union combining the strength of 28 (soon to be 27) nations to implement measures to restrain the power of capital is clearly much greater than that of 28 individual states, all with varying degrees of prosperity and quite different economic profiles.

What Brexit shows us quite clearly, however, is that the reform of Europe cannot be carried out half-heartedly or without addressing people’s legitimate concerns about the direction of their societies. This cannot be an elite process to be carried out on behalf of European citizens but without their involvement. The era of neo-functionalism is well and truly over. The renewal of social democracy, itself a political tradition in crisis, is strongly tied to the renewal of “Social Europe”, a concept which has been permitted to degenerate into a name without substance, fuelling the defection of many traditional social democratic communities from both social democracy and European integration to the hollow promises of nationalism.

Before social democrats can seriously talk of reforming Europe, we need also to be talking about reforming social democracy itself. Social democratic parties have shriveled into mere shadows of what were once not just electoral machines but vibrant political movements. In Britain especially, I cannot help but feel that Labour passed over a huge opportunity to reorient itself back in this direction under Ed Milliband. It is a great shame that the ideas of intellectuals such as Maurice Glasman and Jonathan Rutherford, which coalesced around the “Blue Labour” tendency, were not given their due in the party.

I believe that the Blue Labour approach was never fully understood by the party and, although aspects of it were tested (achieving quite notable successes), the experiment was half-hearted and short-lived. In fact, Maurice Glasman anticipated many of the issues that drove the argument for Brexit and understood them in a committedly anti-neo-liberal way. Had Labour taken the Blue Labour route, it would have focused on community organising and building the party’s base in British society. It is true that many of Glasman’s statements on immigration were seen as controversial although the context in which they were always set, of addressing people’s concerns with place and community, were, I feel, overlooked and misrepresented. It is, of course, speculation, but I cannot help but wonder if things might have turned out differently if Labour had campaigned the way Maurice Glasman and Arnie Graf had advocated in the run up to the previous British elections.

Brexit has shown us that you cannot direct the actions of a populace with fear, or berate them with the claim that There Is No Alternative, nor can you win their sympathy by belittling their concerns or labelling all Eurosceptics as racists and xenophobes. Certainly racism and xenophobia were deployed by the Far Right but, surely, this is the point. If we do not want to cede the field to the right-wing populists we have to be able to offer another narrative; a story that takes popular concerns seriously and deals with them sympathetically while offering a better explanation of the problems people face and better solutions to the very real concerns they have. Unfortunately, the inability of the Left to do this enabled the Right to offer up the nonsensical idea that Brexit represents some kind of reclamation of “stolen” sovereignty. Listening to UKIP, you could be forgiven for thinking the UK was the victim of some kind of imperial annexation from Brussels, whereas, in truth, most of the suffering imposed on the British working-class and poor over the last years is directly attributable to the neo-liberal politics of domestic British governments.

It must be acknowledged that people (as opposed to states) have, indeed, lost sovereignty over their economies and societies over the last thirty years but this is not due to the EU integration process alone. Most of the loss of sovereignty, especially over the economy, experienced in modern nation states has come about as a result of the willing renunciation of this sovereignty by their own national governments. Although Europeanisation has complicated this issue and provided a remote, poorly understood target for popular anger in the symbolic form of Brussels bureaucrats, the UK has been an active participant in all of the processes and treaties which have created the current sense of disconnection.

The democratic deficit is not a problem only of the EU level of governance but permeates the modern state. The problem stems from the disastrous fantasy that economics can be separated from politics and society which, as Polanyi pointed out, is impossible. Economic decisions are political and social in impact. Democracy cannot function meaningfully unless it extends also to the economy. This is, historically, the social democratic task, to extend popular sovereignty over the economy to ensure the maximum empowerment of citizens in their everyday lives. How deeply unsettling it is in the current era when, faced with the fallout of a huge, multi-level democratic deficit, we also suffer from a social democratic deficit where too many social democrats themselves have forgotten or ignored this historical mission to fight for a good society and accommodated to the bankrupt assumption that There Is No Alternative to a future dominated by a pervasive atmosphere of uncertainty, precariousness and fear.

The exit of the UK from the EU has opened up a new, and unfortunate, chapter in the history of European integration. If this is not to lead to a new period of dis-integration and a rise of illiberal democracies peddling aggressive xenophobic ideologies, the Left needs to get its house in order. The fates of the EU and social democracy are deeply intertwined, the urgent task for those of us who want to see a bright future for European societies is the thorough renewal and reform of both. At the moment, all options for the Left are hard and no course of action will be easy. The idea of a democratic federal Europe seems utopian, yet what choice do we have? We have a very small window of time before it may well be too late to save either Europe or social democracy from the atavistic winds of reactionary nationalist fear-mongering.