By John Weeks.

[author of Economics of the 1%: How mainstream economics serves the rich, obscures reality and distorts policy, Anthem Press, $17)

[And how many will choose far-right parties such as the Greek Golden Dawn?]

Socialist Europe? Guess Again

Many people in the United States, and not just Republicans and similarly anti-social types, think that “Europe”, usually meaning Western Europe, is inclined to “socialism”, or at least social democracy, welfare state, cradle-to-grave, etc.  If anyone out there in Real News Land holds that view, let me enlighten you.

As much as I would love to write, “yes, socialist to the core”, Europe is not.  Since 1990 the dominant political trend in Western Europe has been much the same nasty neoliberalism that has ravaged the United States (see my new book, Chapter 9).  True, several European countries continue to have a social democratic appearance, most notably Denmark, Sweden and Germany.

This appearance is misleading.  In the United States the neoliberals had a very limited welfare state to destroy.  In Europe, especially Northern Europe, much more social support and protection existed for free market reactionaries to dismantle.  Over the last twenty-five years the anti-social forces of the Right have made considerable progress in their destructive tasks.

By any measure reactionary forces in Europe have dismantled more of the public sector than their bed-fellows (bed-gals) in the United States.  I doubt that in any country privatization of public assets has been more thorough than in Britain, where even the post office is now in the hands of predatory capital.   In Germany the legalization of a two-tiered labor market has severely reduced the social protection of the working class (not to mention the official policy of freezing real wages after 1990).  In the Southern European countries, Portugal, Spain, Italy and Greece (moving west to east), reduction of social protection qualifies as criminal.

Since the introduction of the euro in 1999 the European Union has served as a major vehicle for the implementation and consolidation of neoliberalism in the eighteen member countries using the common currency.  In the eight non-euro countries the European Union plays more of a supporting role for domestic reactionaries seeking to cut away at the public sector.

Anti-Social vs. Social Europe

In every member country the EU elections will be fought between those for and those against further economic and political integration.  On both sides we find parties the political Right and the Left.

The split on the right comes out of national chauvinism.  The pro-EU right favors greater integration as a vehicle for further consolidation of neoliberal policies, especially in fiscal policy (think “balanced budgets”).  Moving to greater economic integration  is the project of the Germany government, supported most strongly by the governments of several small countries hoping for spillover of Teutonic economic growth.  One does not have to be paranoid, nor is it anti-Germany, to see that further integration is the vehicle for control of Europe by German capital.

The anti-EU right in most of the 26 member countries is in practice as enthusiastic for neoliberal economic policies as the pro-EU right.  They oppose further integration out of fear of German domination (remember World Wars I and II?), fear of migrants from other EU countries, or an ethnic-based xenophobia (or all of these).  These troglodyte xenophobes and nationalists are likely to make the largest gains in the elections.

On the left the split comes from opposing views on the nature of EU institutions.  The pro-EU left argues that while they are flawed, existing institutions provide the only feasible route to a social democratic Europe.  This argument has at least two major strands, that in a globalized world social democracy can not be built and maintained in one country alone;  and that the European Union is what prevents the various national capitalists from providing destabilizing conflicts that could lead to economic rivalry and perhaps even open warfare.

While taking both of these arguments seriously, the anti-integration left assesses EU institutions as the major barrier to a social democratic Europe.  One of the best of these institutions is the European Central Bank and it is very bad.  Despite having a relatively enlightened president in Mario Draghi, the ECB plays a profoundly reactionary role, imposing a one-size-fits-all monetary policy.  The ECB’s charter specifies that its only macroeconomic objective is low inflation, as well as forbidding it from functioning as lender-of-last-resort.  The latter probation meant that the ECB could not take the obvious and simple step that would have prevented the euro crisis of 2010 — purchasing Greek bonds at a low, fixed interest rate.

As for proposals leading to a common fiscal policy, the ones adopted and on the table for future adoption are a progressive’s nightmare.  Existing and proposed rules would in practice prohibit counter-cyclical fiscal policy; which is their explicit purpose.  The sub-textual purpose is to squeeze national budgets, over which the European Commission would have a veto, so that social democracy becomes a relic of the pre-euro past.

The Likely Outcome

[Poster of the Austrian far-right Freedom Party, calling for a Christian Europe.]

The most likely outcome of the elections being held towards the end of May will be a dramatic increase in the number of far-right members of the European Parliament, a small increase of respectable right members and a major defeat of left parties.  As a result, the parliament will become a dysfunctional debating arena between the factions of the right.  The probability of further economic integration of any type will be close to zero.

The likely measures to come out of the new parliament will be growing attacks on migrants, reduced protection of national minorities, and weaker support for civil liberties in the EU and abroad.  While the parliament sticks to anti-social legislation, the European Commission, strongly influenced by the German government, will continue the neoliberal economic project through administrative decrees.

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John Weeks is Professor Emeritus and Senior Researcher at the Centre for Development Policy and Research, and Research on Money and Finance Group at the School of Oriental & African Studies at the University of London.