THE European Union (EU) has suffered the worst crisis since its foundation. Far from being temporary, it is its foundations that tremble.
By Felipe Alegría – International Courier 22 (special edition on Europe)
A mid the depressive wave that began in 2007/08 that is intertwined with the climate emergency, the EU is being shaken by the conflict between the US and China and displaced in the world division of labour. This affects Germany first, but after it, the whole of the European economy.
Official propaganda introduces us to the EU as the refuge of “European values”: peace, human rights, democracy and welfare state. However, all these years have clearly shown the true face of the EU: a social war machine, rigidly hierarchized, with German capitalism at the command post, in alliance with the French.
The EU has been the main protagonist of the worst plans of adjustment and labour and social counter-reforms since World War II. The devastation and looting of Greece is its most sinister feat. The EU supports the repression of the Spanish State against the Catalan people for wanting to exercise their legitimate right to selfdetermination. The EU maintains a xenophobic and racist policy towards refugees and immigrants, outsourcing dirty work to the governments of Turkey and Morocco and the Libyan mafias and turning the Mediterranean into a huge mass grave. The EU is the instrument of the foreign policy of the central European powers to conclude trade agreements, cover the sale of weapons to bloodthirsty and corrupt regimes such as the Saudi or legitimize military interventions such as those of French imperialism in Africa.
The EU in crisis
The plans that Germany and France launched in 2015 to “refound” the EU, reinforcing their powers and subjecting rigid control to the other states (mainly peripherals) remained in the refrigerator. Meanwhile, “Euroscepticism” has spread throughout the continent. Britain leaves the ship, with Trump pushing Brexit, the Scottish government fighting for a new independence referendum and the revived Irish problem.
The whole of the European institutional system set up after World War II is broken, and political instability is the norm in Europe. The great parties of the right and social democracy, which for decades sustained capitalist domination on the continent are in open decline. In some countries they hold on and in another, like France, they have become marginal forces. Meanwhile, Macron and the green parties emerge, and the extreme right arises, exploiting xenophobia and racism and relying on the popular rejection of the EU, with which, at the same time, they refuse to break.
European powers feel that the ground moves under their feet
The European imperialist powers many decades ago ceased to be the masters of the world. World War II marked its final decline and sealed its dependence on the US, the new great hegemonic power. The European reconstruction was carried out under the impulse and leadership of US imperialism, which promoted the creation of the institutions that would later lead to the EU. The US-Western Europe alliance was for decades the axis of the world division of labour. The US pact with the reborn German bourgeoisie was a centrepiece in the balance of the state system.
This pact cracked with the arrival of Donald Trump to the presidency. One of the first things Trump did was to abort the TTIP, the free trade and investment treaty that had been laboriously drafted by the EU and the Obama Administration. Trump openly favours the breakdown of the EU (starting with Brexit). He prefers to treat country by country, asserting with full force the weight of American superiority, and not with a block led by Germany. But Trump’s turn is not a simple whim of the character but responds to the deep disruptions caused in the world order by the crisis of the so-called globalization.
The “globalization” took off in the 80s, giving rise to an upward wave of capitalism that lasted for more than 20 years, until the outbreak of the financial crisis of 2007/08. Its main point of support was the restoration of capitalism in China, promoted by the Communist Party. The US-China partnership was the focus of “globalization.” That included the general liberalization of capital movement, incorporation of the Internet and new technologies (ICT) into production and distribution. And a reconfiguration of global production chains pivoting on the millions of Chinese workers who were incorporated, under conditions of semislavery, into the capitalist world market.
“Globalization” and the EU
The great European powers enthusiastically joined the “globalization”. In 1986 they launched the “Single Act” to create the “single European market”, establishing full freedom of movement of capital and accompanying it with a first neoliberal rush against the social conquests achieved since the post-war period. The next step that intended to implement the single European currency, was the Maastricht Treaty (1991), which was associated with a strong offensive of cuts and counterreforms, by social democratic governments.
“Globalization” in Europe was linked to the restoration of capitalism that led the Stalinist parties in the USSR and Eastern Europe. The great beneficiary was German capitalism, which culminated a process of semicolonization of Eastern countries serving their multinationals, particularly automobile companies. This process took place at the same time as the integration of East Germany and the imposition of the Hartz reforms (2003-2005) by the social democrat Schröeder, which led almost a quarter of the German working class to the extreme precariousness of the “minijobs”. On this basis, the German economy, which was already the leading European economic power, strengthened its hegemony in the continent. It is a powerful exporting machine, making its suppliers a good part of EU industry[i].
In this process, the single currency (with the ECB) was a basic instrument to consolidate German power.
When the financial crisis broke out in 2007/08, the main European powers, supported by the EU, avoided collapse by rescuing their banks with public money. They plundered the periphery (Greece, Portugal, Eastern countries, Ireland, Spanish State) and lashed out in general against public services, wages and pensions, with special intensity in places like Britain. At this time, Germany reinforced its hegemony while Greece and Portugal were downgraded to the level of semi-colonies in which went was placed under foreign dictates.
Through austerity plans the working class of a good number of the EU countries aresubject to a new exploitation pattern whose feature is a widespread precariousness of employment, wages and living conditions and the impoverishment of broad sectors of the middle classes.
None of this was an inevitable process. It happened because of the complicity of the big union bureaucracies and the betrayal of a ‘left’ who, like Syriza, won the support of Greek people as they saw them as a champion of the fight against austerity but then they became the successor of the PASOK and the new hitman from the Troika.
But even so, despite its antisocial offensive, European capitalism has failed to get out of the depressive wave that began in 2007/08. Not only have they not reversed the decline, they have only managed to endure by appealing to the European Central Bank, which has bought public and private debt massively and has given unlimited funds to the banks at 0% interest. A remedy that they now recognize is no longer enough. Meanwhile, German industry is currently in recession, economic stagnation exists throughout Europe and the threat of a new global recession emerges.
The crisis of European capitalism, part of the general crisis of “globalization”
The European crisis is an integral part of the general crisis of “globalization.” World capitalism entered 2007/08 in a period of stagnation without at the moment seeing a way out. No general wave of investments, associated with the increase in the rate of profit, which may lead to a new boom period is on the agenda. The general economic course, on the other hand, is marked by an increasingly monstrous parasitism and by the course of the American imperialist battle to subdue Chinese capitalism, which aspires to dispute the super-profits in key economic branches (5G etc.) and the regional control of Asia.
This global struggle alters the location of the regions and countries of the world, causing the displacement of Germany and the EU, sandwiched between two much more powerful capitalisms. Germany’s place in the world division of labour is associated with its export power, now in decline (which could be seriously aggravated if Trump carries through his threat of raising tariffs on German cars). The crisis of the great German bank (Deutsche Bank) relegates it from the first line of world financial capital. At the same time, Germany (and the EU) has lagged behind in big global technology companies that parasitize and monopolize the global profits. These globalized companies are concentrated in North American hands (followed by China).
The decline of the German economy is accompanied by the decline of French capitalism and drags all EU countries in the same direction. This process undermines German leadership, hits the German-French alliance and questions the “cohesion” of the EU.
Social and political consequences of the decline of European capitalism
European capitalisms and the EU have entered a period of decline. A decline that brings with it a new impulse to industrial relocation and generalization of garbage jobs in the service sector but also in industry, with low or very low wages, attacks on public pensions and deterioration of health and education systems. The reference of the capitalists is labour and social conditions in the countries of the East looking towards Asia. This continued capitalist offensive affects the European periphery, which is increasingly dependent, as are the central countries, as we see in the British social degradation or the current Macron offensive against the public pension system.
The other side of social degradation is the growing use of EU states for increasingly authoritarian and bonapartist measures against democratic rights, including the right of workers to collective bargaining. This is the case of the “democratic” governments of Macron, the PSOE or the new Italian cabinet formed by the Democratic Party and the M5S.
Macron’s presidency has distinguished itself by attacking labour rights, by brutal police and judicial repression against the Yellow Vests and by the adoption of new laws against the right to protest and assembly. The new Italian government maintains the “Salvini decrees” that cruelly punish those who help refugees and emigrants and allow those who occupy an empty house or block a road during a strike with long prison sentences and massive fines. In the Spanish State, we suffer the brutal condemnation of the Catalan independence leaders for promoting a referendum and the savage police repression against protest demonstrations opposing the convictions. The doctrine of the Spanish Supreme Court could be used to charge with sedition those who prevent the execution of the police. In the same way, the crime of terrorism can help prosecutors indiscriminately accuse those who face the monarchical regime. We want to underline that we are not simply talking about the reactionary “illiberal” governments of Kaczynski (Poland) and Orbán (Hungary), reviled by the “liberal” press, but about the three most important states in the euro zone after Germany.
EU defenders from the left
The European capitalist powers, with Germany in front, need to sustain the machinery of the EU to try to maintain their power in the current world confrontation as well as to continue counting on this great common weapon against the working class and the peoples of Europe. But, at the same time, its decline weakens the EU and reinforces centrifugal tendencies, fuelled by Brexit and supported by a growing social rejection that not only covers the working class of the various countries but also the vast sectors of the petty bourgeoisie impoverished and even middle sectors of the bourgeoisie mistreated by financial capital. In any case, beyond the concrete path taken by the course of European capitalism decline two things are clear: the first is that the cost, which is enormous, will fall on the backs of the working masses and the second, that the role of the EU will be central in the offensive of capital.
However, the British trade union bureaucracy and the submissive left to Labour, who are unable to confront Brexit tory with a socialist Brexit, want to make British workers and youth believe that the EU will protect workers’ and social rights. They should ask the Greek, Portuguese or Spanish workers, the yellow vests or the Catalan independence workers. Although, in reality, the arguments of the supporters of “Remain and Reform” (“Stay and Reform”) are the same as those used by Pablo Iglesias (Podemos), the leaders of the Portuguese Bloc or Melénchon (la France Insoumise). The chorus of former admirers of Tsipras.
There is in the extreme European left who, like Lutte Ouvrière in France, argues that fighting the EU makes no sense because “the fight is against capitalism.” With this, in the name of an abstraction, they emptied the concrete struggle against capitalism. Because there is no French capitalism separate from the EU. French capitalism vitally needs the EU to attack its own workers and to continue playing a role of an imperialist power in Europe and in the world. There is no fight against French capitalism other than the fight against the EU and for a socialist Europe of workers and peoples. There is also, within the so-called European extreme left, who oppose the fight for the break with the EU and the Euro, claiming that it is a “nationalist” exit that “takes the game to the extreme right.” In reality, it is a false argument that amalgamates the popular rejection of the EU with chauvinism and the xenophobia of the extreme right, grossly misrepresenting reality and giving left-wing coverage to the defenders of the EU and the Euro.
There is finally a group, formed by leaders of the “Unified Secretariat – Fourth International” (USFI), which are the last trench, the most sophisticated, in the defence of the EU. Six years ago (with the European periphery in the midst of the debt crisis) they defended a “bold refoundation of Europe” and vehemently opposed any break with the Euro and the EU. They defended “anti-austerity governments” with a “viable strategy”, to negotiate “debt restructuring”. Tsipras and his government were, also for them, the great model. That is why they supported him until a second before he committed the infamous betrayal of the July 2015 referendum.
Now, after the Greek experience, they can no longer support Tsipras and say that the EU can be “radically reformed from within.” However, in a recent manifesto[ii] They continue the desperate search for a third way to avoid calling for a break with the EU and the Euro. The manifesto, dedicated to explaining the measures of a “popular left government” in its first year, proposes an “immediate” Keynesian program of disobedience of the Treaties but remaining in the EU and the Euro, and without affecting property of the large means of production and banks. In the same way, in its medium-term scenarios it contemplates the implantation of a new currency that would, however, be complementary to the euro, in whose framework they would remain. A really elaborate and bizarre project.
There is no way out without true European unification, that is, without ending the EU and building the Socialist United States of Europe.
The EU reflects the very high degree of integration of the European economy and, at the same time, is the main obstacle to its true unification. Economic integration has not led to the formation of a European state that promotes convergence between different countries. On the contrary, the different bourgeoisies have maintained and reinforced their own state to defend the interests of their financial capital and face their working class. Formal borders have been largely diluted, but the economic and social boundaries between countries have been strongly reinforced, deepening economic and social inequality between them. This trend, far from dimming, has deepened during the past crisis and will be further accentuated in the future.
Under capitalism it is not possible to rescue Europe from decay, nor the working masses of social regression, nor to face the climate emergency. It is not possible to do it without unifying Europe under the power of the workers. The struggle to take power and expropriate capital begins with individual countries but can only culminate successfully by extending it to other countries and building the Socialist United States of Europe, understood, in turn, as part of the struggle for a socialist Federation world.
The struggle of the Catalonian people for their national rights faces not only the monarchist regime but the EU, the great support of the Spanish State. The movement against climate change not only clashes with the hypocrisy of governments but with that of the EU, which promotes and legitimizes a policy at the service of “green capitalism”, which neither wants nor can tackle climate change or environmental degradation. The solidarity movement with the Kurdish people clashes with the EU’s complacent policy towards the Turkish regime, subcontracted to close the passage to Europe of the Syrian displaced, which it maintains without rights and in destitution.
The French Yellow Vests not only face Macron, but also the EU. Macron’s plans against the public pension system are not only a requirement of French capitalism but of the EU.
There is no individual “national” salvation without unifying Europe under the power of the workers. Only in this way can we achieve true economic unification, putting all forces at the service of human progress; ending the division between first, second and third category Europeans; converting industry and commerce to face the social and climatic emergency; turning the continent into a bulwark of the struggle for world socialism.
This means, first of all, ending the EU. There is no revolutionary policy in any EU country that does not start from there and the struggle for a Socialist Europe of workers and peoples. This is the unifying axis of every revolutionary program in Europe.
Finally, we are going to quote a few words that Leon Trotsky made in the IV Congress of the Communist International almost 100 years ago, which fully retain their validity: “the slogan of the Socialist States of Europe is on the same historical level as that of ‘ workers ‘and peasants’ government; it is a transitional slogan, it indicates a way out, a perspective of salvation and it provides, at the same time, a revolutionary impulse to the labouring masses.” This is the way.
[i] The German economy represented in 2018, 28% of the EU GDP and 39% of its industrial added value. It is the third exporting country in the world and its sales abroad represent 40% of its GDP. The US and China are its main clients outside the EU (8.71% and 7.13% of the total). Its main exports are luxury vehicles and advanced machinery.
[ii] The “Manifesto for a new internationalism of the peoples in Europe” (March 2019) is headed by Eric Toussaint and signed by leaders of the SU-CI (including the historical leadership of the French NPA), together with leaders of reformist forces (France Insoumise , Attac, Spanish United Left, PCF …) and some prestigious intellectuals.
The European Union Crisis
THE European Union (EU) has suffered the worst crisis since its foundation. Far from being temporary, it is its foundations that tremble.