If the ballot can’t change anything all that remains is the bullet

Even the arch-technocratic Crooked Timber is a bit distraught at the European Central Bank’s policies:

I’ve spoken to people at the European Central Bank – they are very smart, and very sincerely believe that the best path to long term prosperity is through enforced austerity. They are also – by design – nearly completely insulated from democratic pressure. And despite claiming that they are apolitical, they are in fact playing a profoundly political role, dictating the kinds of domestic institutional reforms that states need to implement if they want to continue getting ECB support.

This means that ECB decision makers are under no very great obligation to think about why they might be wrong, up to the point where complete disaster occurs. And disaster is very likely, if the lessons of the gold standard in pre-World War II Europe tell us anything at all. Enforced austerity does not produce economic growth. What it does produce is political instability.

The people at the ECB may very well be smart — or at least middleclass and polite– but you will never convince them of any facts their paychecks depend on denying. They cannot be reasoned with, they can only be forced to abandon their neoliberal economic orthodoxies and since they cannot be forced through the ballot, it will have to be by the bullet. The radical austerity policies the ECB, IMF, EU and all the other parts of the alphabet soup are enforcing on Europe are pushed through not to benefit the voters, but the banks. Simplistic? Yes, but closer through the truth than what you read in respectable newspapers or hear explained on the news.

Politics and the mainstream media together form a closed system, where only limited deviancy from the orthodoxy is accepted and which has been carefully designed to give the impression of democratic control while making sure to limit any influence ordinary voters might have. Anybody who paid attention could see this in the runup to the War on Iraq: on a single day two million people marched in London alone, millions more across the world but it didn’t stop the war, didn’t even slow it down. It wasn’t an election year and therefore it was easy to ignore the voters: let them march, let them write letter to the editor that won’t be published, let them vent their outrage on Question Time or Any Questions, the smart people know it won’t matter. Give it a month or a year and the smart people can all pretend everybody was in favour of the war; well everybody who counted anyway.

Yeah, sure, Blair had to give up being prime minister a couple of years later, when the smart money was already shifting towards the Tories anyway, but he’s got millions in the banks thanks to cushy jobs given to him by his grateful friends in the private sector and all the respectable newspapers and televion newsshows still take him seriously as peace envoy to the Middle East. Some people might spit on him in the streets, but when was the last time Tony walked anywhere anyway?

Democracy has been made safe for capitalism again; voting won’t change anything important. And if voting doesn’t work, if the ballot is powerless, then the bullet remains…

The mask slips: the real reason for insisting on budget discipline

Politicians and socalled objective media both have been pushing hard the idea that the Euro crisis can only be solved by spending cuts and spending discipline, but luckily there’s the Washington Post to spell out the real reasons behind this:

“If adopted by other nations in the union, the deal would mean drastic cuts in European budgets. It would also spell the end of three decades of overspending that helped finance a cozy social protection system envied by much of the world.”

It has nothing to do with solving the crisis, it’s needed to destroy what remains of social democracy in the EU, by attempting to take away the power to set budgets from elected national politicians through hard spending limits and fines if these are breached. There already are some such agreements in place amongst the countries who have the Euro as their currency, but in practise these turned out to be not as hard as they were supposed to be in theory, especially not when you’re called France or Germany. The proposed plan would make it difficult to “blow the budget” even for those countries, but it will of course still be the weaker countries that will suffer more under these plans. Introduction therefore would inevitably lead to more spending cuts and more structural budget cuts even in the richer countries.

But what it doesn’t do is solving the current crisis, as Alex at A Fistful of Euros explains through examining what would’ve happened had it been in place already:

It would have been much easier to sanction the decade’s violators of the Stability & Growth Pact – Germany and France. Of course they got sanctioned anyway, but perhaps they would have had to pay a fine. Let’s be charitable for a moment and assume that this would indeed have caused them to run a lower public sector deficit. This would have changed what, precisely? Had it depressed internal demand in Germany, all other things being equal, it would have caused Germany to increase its trade surplus. A bigger trade surplus implies a bigger deficit elsewhere, and it also implies that German and French banks would have lent the private sector “elsewhere” the money they needed to buy the additional exports. An additional problem might have been that, had German bonds been in shorter supply, investors would have sought other AAA-rated assets and piled up even more bubbly mortgage-backed securities, which the banks would have been delighted to sell them.


But one thing this proposal would categorically not have done is to stop Italy or Spain or Ireland running up more public debt. Public debt fell in these countries from 1995 to 2007. Even Portugal and Greece didn’t exactly explode. Ireland would still have a budget surplus if it hadn’t massacred itself to save the banks (in part because the ECB wouldn’t help). Greece, well, perhaps, but it seems to be clear that just yelling at the Greeks is insufficient to fix Greece’s problems.

What causes government debt in the four largest EU countries

Meanwhile the chart above (From ToUCstone) shows what really drove up government debt in the four largest EU economies and it ain’t “a cozy social protection system”.

Blair or Balkenende?

Really? That’s going to be our choice for president of Europe, a choice between a war criminal and a Harry Potter lookalike (and also a war criminal)? Have we lost all selfrespect in Europe, do we really think the EU is so unimportant we get to choice between those two shits? Blair is hated all over Europe for his role in enabling the War on Iraq, while Balkenende is (fortunately for him) almost unknown outside Holland other than for his uncanny resemblance to the nerdy boy wizard, but equally loathed inside the country. If we had a choice, neither would be in the running.

But then we don’t, do we? In this greater and glorious post-Lisbon non-treaty Europe, we still don’t get a vote in who gets to run the EU, instead our betters will decide for us. The choice for Blair makes sense in that context, loved by his peers, hated by everybody else. The EU gets the leader it deserves and it’s telling that this election is big in the newspapers, where all the Serious People are explaining why Blair/Balkenende is the obvious choice, but not on the streets, where other than a few snorts of disgust I haven’t heard anybody talk about it at all. It’s our current political system in a nutshell, played in the media for the political classes, with no role for the rest of us other than in the voting rituals that happen every couple of years.

The EU’s role in the British postal strike

Lenny tackles the fear, uncertainty and doubts being spread about the postal workers strike:

These myths – about union intransigence, about the economic necessity of job losses, about the superior efficiency of private competitors, etc. – are being deployed for the purposes of turning a low-cost public service provider into a marketplace of competing providers in accordance with the extraordinarily resilient neoliberal orthodoxy. This brings with it the usual problems – soaring costs, as companies seek to make a profit, duplication of capacity as they fight for market share, and poorer service as low paid, casualised and de-unionised workers are less committed to the job, and less likely to have the time and training necessary to develop their skills. Royal Mail, for all its faults, is one of the last bargains in town. Less than forty pence for a first class letter to anywhere in the UK is nothing. What else would you spend that money on? You couldn’t even buy a pint of milk or a Mars bar with that money. Additionally, as much as businesses might whine when there is a strike on, capital makes a big efficiency gain with Royal Mail, especially if they use the metered mail service which gives them a further discount. Admittedly, the Royal Mail is not as cheap as America’s socialised mail service, where a first class letter can cost as little as $0.44 (£0.27). But we can’t all be as communistic as the yanks.

And the reason why we can’t be is the European Union. The decision to end the post office’s monopoly and (part-)privatise the mail service is not something New Labour thought up on its own –though they’re obviously not against the idea– it’s been an EU directive to “liberalise” the postal markets for years. And because it is an EU directive, individual countries can’t opt out, but are “forced” to carry through these sort of unpopular or even harmful reforms. This is the role the EU was created for, the bogeyman that can force through decisions governments want, but know would be electoral suicide to pursue themselves.

And even with the European parliament there’s little to no democratic oversight about these decisions and little attention paid to them or the EU’s role in determining Europe wide economic policies, even by people and organisations who should know better. We tend to focus on our national governments and parliaments rather than on Brussels, but much of what they supposedly decide has been decided for them.

Without the EU New Labour would probably still have wanted to privatise mail deliveries, but it would’ve been much more difficult to make it seem unavoidable.

UPDATE: it seems the above has been misinterpreted as me blaming everything on the EU. But of course it’s not the case of evil eurocrats forcing privatisation of the post office on New Labour. Quite the opposite. Neoliberal governments like New Labour have used the EU as a tool, creating EU regulation and treaty obligations to be used to force their own desires through. The opening up of the postal market is one example of this, another one was the “deregulation” of public transport, which here in the Netherlands almost meant the Amsterdam city owned public transport company had to be privatised. Luckily in that case internal resistance was string enough loopholes were found to prevent this.

The EU in its current incarnation is a tool of capitalism, used by neoliberal governments to overcome opposition in their own countries. EU laws, regulation and treaties lay the framework within which the part-privatisation of the post office can be made inevitable, and often it is too late once these issues surface on a national level. One of the few unions to understand this have been the dock workers fighting against deregulation on an European scale, pressuring both their national governments as well as Brussels.

No means No, except in Europe

Last Thursday the Irish, as the sole EU inhabitants to get the option, voted to reject the Treaty of Lisbon which was to further centralise and restructure the union. Which means that after three years of navelgazing and rapackaging the quest to establish an EU constitution is once again back at square one. Then it was the French and the Dutch who rejected the constitution and who therefore this time didn’t get to vote on it. If you vote the wrong way you’ve clearly shown not to be mature enough to decide on these weighty matters. For the Irish government it was more difficult to ignore the population, as the need for a referendum on constitutional matters is enshrined in law, so they had no choice but to call for a vote and hope for the best.

but once again these hopes were dashed, and this in a country traditionally quite Europe-minded. Once again it leaves the EU project floundering and once again the immediate response of European politicians and media is to blame the voter, not the treaty. Three years ago the rejection of the constitution led to a “process of reflection” from which emerged this treaty, largely the result of copying the constitution into a new document and doing global search and replace, with some relatively minor concession and symbolic changes. As if making the EU flag the mandatory symbol of Europe was why people objected to the contitution. Doing the same again isn’t feasable, but the process has to move forward so instead we get various European bigwigs like French foreign minister Bernard Kouchner threatening the Irish for their impudence while Gordon Brown amongst others has called for ignoring the vote by going ahead with the ratification in other countries and leave the Irish government to sort out things at their end.

Because the people in charge are convinced of the essential rightness of the constitreaty we don’t get any serious attempt to understand why first the French and the Dutch and then the Irish voted against it, but instead we get whisper campaigns to delegitimise the results of these referenda. For the Irish result the talking point being pushed is that it’s quite undemocratic for one million Irish to decide for 250 million other Europeans (one example). I agree with that, but it wasn’t the no-voters who decide the rest of Europe shouldn’t have a vote. The other way to delegitimise the Irish vote, and one much in evidence three years ago as well, is to disparage the motives of the voters. If you look at this Crooked Timber thread for example you see arguments that the Irish voted no because of their ignorance, their fear of foreigners, because the yes campaign wasn’t good enough, that it was just too complex for ordinary people to understand, and so on.

The common thread in all of this is that yet another no vote should not intefere with the orderly transition to the EU the European political elites want, but their voters are at best lukewarm about. It is brought as a matter of survival, as if the very functioning of the EU is under threat if these changes aren’t made, but we’ve seen how true that is in the three years since the rejection of the original constitution. Yet somehow the EU muddled through. It’s no wonder people are skeptical when all these grand plans are made without their input, their vote is only taken seriously if they vote yes and when they do vote against them their leaders don’t listen and they’re portrayed as xenophobic ignorami.