The intervention of Michael Roberts in the event about the EU and the Radical Left

Posted: June 19, 2019 | Author: | Filed under: Uncategorized | Leave a comment

It’s been 70 years since the political leaders of European capital began the process of trying to integrate the previously warring states of Europe into a single trading bloc with a view to turning Europe into a force capable of rivalling US imperialism across the Atlantic and later, the rising powers of Japan and industrial Asia.

It started with the integration of key basic industries in the European Coal and Steel Community in 1951; then with the formation of a Common Market based on the core economies of Western Europe and then to the wider European Economic Community in 1957 with a customs union.  Finally, the political project was completed with the formation of the European Union in 1993.  Such was the early success of this project that eventually the declining imperialist power of Britain decided to join and put its future in the hands of Europe rather than with any ‘special relationship’ with America.

In the period of fast growth and high profitability of the 1950s and 1960s, the EU was a relative success.  Indeed, when the weaker capitalist economies joined, like Spain, Portugal and Greece after their revolutions to overthrow military rule, these economies made gains through more  trade and investment, even converging somewhat towards the rich core economies of Germany and France.

But, as the world capitalist economy entered the 1980s with low profitability of capital across the board, that early success in integration began to subside.  The French and Germans then took an historic decision to drive integration forward with a move to single currency area and the euro.  But convergence to the euro was based not on closing productivity, employment or income levels, but purely on monetary and fiscal convergence.  The squeezing of the weaker capitalist economies into the Eurozone’s monetary and fiscal straitjacket turned convergence into divergence and set up faultlines for future crises.

Franco-German capital took advantage of cheap labour and the single currency to invest in the weaker Eurozone economies, but not always productively and not necessarily to the benefit of weak.  Indeed, the strong got stronger and weak got weaker.  The weak were only able to expand by borrowing heavily.  Private sector credit rocketed in Spain, Greece, Portugal and Ireland.  At the same time, EU governments cut taxes on the rich and corporations and so lost revenues, while still trying to sustain welfare benefits and public services.  Then came the global financial crash and the Great Recession.

The credit crunch and the collapse in world output and trade pushed the weaker Eurozone economies into bankruptcy.  They could not pay their debts to German and French banks.  Public sector finances were trashed by the loss of revenues and the huge rise in unemployment and other welfare benefits.  And then the banks had to be bailed out  and the public sector had to pay.

Greece’s public sector debt had risen to 100% of GDP when the euro was launched, so already very high.  But in order to pay off the Franco-German banks in the Great Recession, the government had to nearly double that debt.  It only got the funds to do that by borrowing from the IMF, the ECB and the EU funds – the dreaded Troika.  In return, the Troika demanded the most vicious austerity measures since the Versailles treaty imposed on Germany after WW1.  Pensions, wages, public services and benefits were decimated; public assets were sold off for a song.  The funds saved and raised were not used to sustain the Greek people in this terrible depression.  They were used to pay off the banks and then meet the repayment schedule of the IMF and the ECB.

The Greek people fought back.  When the Syriza government reluctantly called a referendum on whether the government should accept the draconian measures demanded by the Troika, despite the international media pressure and despite the domestic big business attacks, they rejected the Troika deal by 60-40.  This was not what European capital or Syriza expected, and as we know, within days, the Syriza government broke the people’s mandate and capitulated.  Finance minister Varoufakis, having failed in his policy of trying to ‘persuade’ the German and the EU leaders to ‘see reason’, resigned and rode off into the sunset.  Syriza split but the bulk of the government party stayed behind Tsipras to keep Greece in the EU and Eurozone and impose the Troika’s austerity.

Now four years later to the very month, Greece’s public debt ratio remains unchanged at 180% of GDP.  This debt that Greece owes to the EU will remain on the books for a generation at least and so austerity has become permanent!  No wonder Greek will probably vote to oust Tsipras and return the conservative pro-business New Democracy in the July elections.

Was there an alternative to this capitulation?  And what can we learn from this tragedy for the future of the EU and the outcome of the current battle in Britain over Brexit?  Was Grexit the answer?  At the time, some on the left in Syriza and much of the revolutionary left groups outside Syriza, as well as the Greek Communists, put forward this alternative.  For example, Costas Lapavitsas, a Marxist economic professor and Syriza MP, who correctly broke with the government over its capitulation, advocated Grexit.  Lapavitsas said at the time: “the obvious solution for Greece right now, when I look at it as a political economist, the optimal solution, would be a negotiated exit. Not necessarily a contested exit, but a negotiated exit.”

But would that have worked to avoid austerity and put the Greek economy back on its feet?  Even if the Troika were to have agreed to such a ‘negotiated exit’, which is a moot point; and even if the new Greek drachma only depreciated by 20% (extremely unlikely), the Greek economy would still be on its knees, unable to restore living standards for the majority. Devaluation and rising prices would eat into any gains made from cheaper exports. Lapavitsas seemed to recognise this: “Wages must rise, but even if they rise, you’re not going to go back to where you were. It’s just not feasible at the moment. We need a growth strategy for that.” Exactly.

But Lapavitsas was opposed to a growth strategy that took away the levers of power from capital in Greece and put it the hands of the government and people.  “I don’t think that Syriza should come out with a broad and wide nationalization program right now.” Apparently, that was something for the future, the medium-term, not then in 2015. “I am very skeptical, though, about this in the context of Greece right now… These are medium-term questions. These are questions that one should knuckle down and begin to confront once the problem of debt, fiscal pressure, and the monetary union have been resolved.”

But this idea of stages: first exit and devaluation and later, socialist measures, seemed to me to be both suicidal economically and also weak politically.  The Greek people opposed austerity but the majority also wanted to remain in the EU and the single currency (and still do four years later).  They sensibly recognised that exiting the EU would put Greece overboard in the Aegean without a paddle, suffering the fate of Argentina in the early 2000s of hyperinflation and mass unemployment.

Sure, if the Syriza government had nationalised the banks, taken over the major sectors of Greek big business and introduced controls to stop the flight of capital, as well as taxing the rich and ending huge spending on NATO-style defence, the EU leaders and the ECB may well have moved to kick Greece out of the EU.  But then the government could show the Greek people and the wider European labour movement that they were not exiting out of choice but being thrown out because the government opposed austerity and was for class policies.  That seems to me a much better way of raising the consciousness of the people as well as being much more effective in taking the Greek economy forward.

For me, that lesson applies to Brexit as well.  The Brexit referendum in 2016 and the argument since was a product of a split in the British ruling class over which direction to take British capital.  The British finance sector in the City of London and the multinationals want Britain to stay in Europe as it benefits their profits most.  But there has always been a layer of the ruling class, based on old empire and imperialist ideology, particularly among smaller business where exports are less important and finance capital is remote. This layer has always opposed entry into the EU and Europe.  It still reckons that Britain could ‘go it alone’ in the world of capital and do better.

This is nonsense, of course – no capitalist economy is an island, particularly island Britain. But this old ‘empire’ view held the hearts and minds of the old petty bourgeois elements that make up the ruling Conservative party and a layer of voters.  And these elements whipped up a myth that ‘EU regulations’ and a flood of EU immigrants were the cause of the woes of many workers, particularly in those areas where austerity under the Conservative government had hurt most.  Thus the myth was created that the EU was the enemy, not capitalism or the Tories and their austerity policies.  This myth was enough to deliver such a potential loss of votes for the Conservatives to pro-Brexit forces that the Conservatives opted for a referendum to solve the issue.  Much to their amazement and chagrin, the vote went for leave, if narrowly.

In the referendum, the British population was split down the middle; split in the top 1%; in the middle-class, in the working class, between city and town, town and country; between young in the cities and the old in the small towns; between the south and the north.  The class lines within British society were totally submerged into whether to leave the EU or not.

But the reality is that the Great Recession and the ensuing Euro debt crisis in 2012-14 was not the product of the euro or EU structures as such, but the result of the global crisis in capitalism.  The British capitalist economy is already suffering from the uncertainty about Brexit as parliament bickers and drags out a way of reaching a deal with the EU on the future.

The solution to austerity in Britain and a raising of living standards is not to be found in exiting the EU but in the replacement of capitalism and implementation of socialist measures by a socialist government.  If the UK leaves the EU, then most realistic estimates are that the UK economy will end up being about 4-10% smaller in output in ten years than it otherwise would have been.  But if there is another global slump in capitalism, that will be much more damaging.  The Great Recession lost four times as much potential output from the UK economy over the last ten years than Brexit would in the next ten.  So Brexit is not vital to the future of British capital or the British people: the state of capitalism is.

That’s why I do not think that putting Brexit at the top of any left programme for socialist change in Britain is the best way to proceed.  The Brexit referendum did not unfold on class lines and Brexit is not an opportunity to promote socialist policies.  On the contrary, it is a reactionary smokescreen erected by far right nationalists and the Conservatives to shift the blame for working people’s miseries onto the remote bureaucrats of the EU and onto Polish and other Eastern European immigrants who have contributed so much to keeping the UK economy going since the Great Recession.

My approach would not be dominated by some ‘Lexit’ policy as such.  It would aim at getting a socialist government elected that would push for taking over the banks and multinationals and reversing austerity through a plan of production and investment involving workers in control.  If such a government then came into conflict with the EU leaders who threatened to expel Britain, then Brexit would become a class issue for the first time.  Unfortunately, for now, leaving the EU can only be posed as a reactionary nationalist demand.

The intervention of Nikos Kapitsinis in the event about the EU and the Radical Left

Posted: June 19, 2019 | Author: | Filed under: Uncategorized | Leave a comment

In my political life, I have learned to structure my thought in a way that it is led by the wider long-term political strategy, connecting it with the short term more specific tactics pf everyday political life. So, if our strategy is to live in a better and more just society, which implies the overthrow of capitalism we need to analyse the opponent, the decisions of capital. A strategic move of capital is its integration in economic, financial and geographical terms. A move like this, pioneer, back then, in the 1950s, in the world, is the EU.

Just a clarification here. Europe and the EU, let’s be clear, are different. So, being a European does not mean that you are in the EU, this is a significant impact of the dominant debate in the UK. Let’s be clear about terminology. Europe is a continent, defined by physical geography and geopolitics aspects, and the EU is a union of capitalist states. They have different population levels, different countries, 55 to 28 states, but the EU is expanding gradually from 6, to 15, 25, and 28 member states. Why is the EU expanding? Capital seeks new markets, fresh opportunities for deeper workers’ exploitation. How is it expanding? The candidate member states need to apply for membership and then initiate structural adjustments in their market, politics, labour market, finances, to comply with the criteria of the EU.

In the left spectrum of political thought there are three stances related to the EU:

  1. EU can be reformed
  2. The left should not deal with the EU, let’s focus on capitalism
  3. The left must fight against the EU in the wider strategy of anti-capitalist struggle

I would like to argue why the EU cannot be reformed, why fighting against the EU is important in the struggle for a better life, and why the EU is the Europe of capital.

The EU has been created by capital, by capitalist governments, in detail. All started in 1945 with the initiative of Churchill, who declared the United States of Europe and then in 1952 the European Coal and Steel Community emerged. So, the foundations are clearly based on capital and markets, since coal and steel were the two industries that were most developed, at that period. And then, late-1950s, the European Economic Community was established, regulating the customs union.

The EU is the integration of capital, capital created it in the post-war Europe to address the intra-capital competition, to open new markets, to signal a new era for the Europe of capital. Let’s see some aspects, which are either inherent in the character of the EU or are addressed in its constitution.

Financial-fiscal terms

-Fiscal stability pact: Maastricht conditionalities: 3% of GDP deficit, 60% of GDP public debt. Public debt is a very useful means for capital to impose austerity.

-These entail certainly permanent austerity within the EU

Political terms

-The whole neoliberal agenda was passed through the EU directives

-Structural adjustment programs

-Privatisations, such as rail and post: industries cannot be re-nationalised within the EU

-Several left positions in the UK argue that the EU is a defender of working rights. Let’s have a look

-The EU has been driving wages down, sometimes increases but much lower than productivity and inflation increase, just securing the profits of corporations

-Less working rights

-Flexible work

-Anti-trade union policies, just to recall the anti-trade union law in 2015, in the UK, within the EU, that regulated that in every trade union ballot, more than 50% of its members should participate, in order for the ballot to be legal.

Educational terms

-Bologna directives

-Marketisation of universities

-Privatisation

-Increase of tuition fees

-Further downgrade of degrees

-More specialised and flexible workers, with less working rights, who when the conditions of the market change, they will be in a very difficult position

-Assessment of universities according to private and economic terms, not the social needs

Migration terms

-Migration is not an opportunity; it is a necessity, since people are obliged to move. After the economies in their countries being deregulated, they are obliged to move to the core, where bosses hire them under very bad working conditions, as people are desperate, which has sometimes impact on the working conditions of people already in the core. And then some others take advantage of high paid positions, but this is not working class, this is not the majority, and they would probably move even without open borders.

-In this way, corporations shift labour around countries, drive wages down, and increase the degree of exploitation

-And let’s recall another example, in the UK, within the EU. What were the rights of the EU migrants in the UK during Cameron’s era? Everyone has an example of a migrant who could not have access to the benefits, which have an exclusionary character towards migrants.

Imperialist role – refugees

While the EU countries have stopped fighting each other, the EU has been transformed to a major imperialist power with invasions in several countries. This has entailed huge refugee flows. The concept of Europe fortress is important here, while we cannot ignore Frontex and the concentration centres. Hundred thousands of dead people in the Mediterranean Sea.

Economic terms

-Single market, customs union: free movement of capital, goods, and services, based on market forces

-De-industrialisation: weakening the social bonds and solidarity that were developed through manufacturing

-Inherent division between core and periphery

Conceptualising the EU?

EU is an integration of capital that benefits the economies (as a whole) of the core and deregulates the economies of the south. Capital is the winner with deeper exploitation of the working class and migrants. The EU benefits upper classes in both core and periphery, mainly in the core, while the big losers are the working-class people in both core and periphery. How? Apart from the previous terms, there is the following inherent and structural process of the EU.

In the open market we have foreign investments and migrant flows. The peripheral economies had structural weaknesses before the integration which expanded within the single market. Then, they saw a deregulation of the productive structure and huge unemployment, which brought migration of people from the periphery to the core. On the other hand, we saw migration of capital from the core to the periphery. Capitalists take advantage of desperate people, offering low paid jobs with weak working rights.

Eurozone was one step forward for capital. It has deepened austerity with stricter fiscal criteria, and implied lower interest rates for workers. Therefore, it has been driving down wages, increasing subprime lending, and expanding the debt of households.

In summary, the open borders, the integration, the flows, are all for the capital in the EU. This is what we should respond to the left that is afraid to speak about the EU. The EU is internationalist, yes, but it is internationalist for capital. From this perspective, we need to defend all the people who were forced to migrate, in every country. But all the migrants, we should forget neither the visas for the overseas people, nor the refugees. There is not a single convincing argument for not speaking about the EU.

So, what should we do?

The main question that needs to be addressed is what the left actually wants. Europe of capital or Europe of people? If the left wants a better society, it cannot be in favour of the EU. What has been happening in the EU till now? Unfortunately, the big dissatisfaction about the EU, which exists in all the EU member states, has been absorbed by the far-right parties which speak about national democracy. Why?

-Since the left has been afraid to lead the anti-EU struggle, due to the weaknesses of the left. Most left support the EU. Important here, is to examine whether there is an alternative within the EU. The example of SYRIZA in Greece is illustrative. People were surprised in 2015 when the Greek government decided to reverse the result of the referendum and apply austerity, but we should not forget that SYRIZA is a pro-EU party. This explains all the events after the referendum. And then people just punished them in the euro elections

-This absorption of dissatisfaction from the far right is also a strategy of the capital. We should not forget that the far right has historically been a very useful weapon for capital, a strong ally. After the 2007 capitalist crisis, the far-right parties recorded significant growth. Then, the neoliberal and ex-social-democrat forces took advantage of this and now highlight the dilemma to the working class people: Do you want the unified EU or a divided Europe based on nationalist ideas?

Regardless of the rhetoric of the far right, we know their agenda which is always serving the capital, be careful within the EU! The examples of Hungary, where Orban voted 400 hours of compulsory overtime annually, paid only after negotiations with the boss, and Austria, where the right and far right coalition regulated the 12 hours working day (within the EU, just to respond to the argument the EU supports working rights), are illustrative. This is the far right. It targets the foreign workers, it is racist against the poor, to destroy the whole working class. It seeks to renegotiate the position of the upper class of each country within the EU.

In the UK, several trade unions have opposed the EU, like RMT, however, the big unions, UNITE, Unison, have supported the it, perceiving it as an umbrella of the working rights, such as maternity and paternity pay and leave, the right to paid leave for holidays, a working week limited to on average 48 hours a week. Apart from the examples of Austria and Hungary and other compelling evidence about the negative impacts of the EU on working rights, there is the question about whether this is what we want. This is not an argument for fighting to stay in the EU, it is evidence that speaks to stronger working struggles to make it 30, 25 and 20 hours per week, not to stay in the EU.

In my opinion, the left, especially in the UK, has been afraid to speak about the EU, as they would be considered as racist. And what has been the outcome? The great weakness of left groups speaking only anti-austerity, not putting into the game the bosses and capital, not targeting the deeper scopes of capital and the EU, even to condemn them politically. In the referendum, some of them, supported the Remain, claiming that the left cannot ask now for an exit from the EU, when it does not have the power. This is a significant proof of no connection between strategy and tactics. Then we should question the participation of the left in the elections, as according to the argument, the left program and demands cannot be implemented. From this perspective, this is also an extreme lack of faith and determination. After the referendum, things got really bad. Few left voices in terms of Brexit, the discourse has been dominated by others, while on top of this, several left people support the Brexit party of Farage.

Addressing the three positions about the EU, remain, ignore, or fight against, I think that we need to demand an internationalist, working class and migrants’ friendly, overthrow of the EU.

Accounting for the connection between tactics and strategy means that believing that the EU can be reformed entails the belief that the system can be also reformed. There is an issue of wider political stance, here. The Radical Left needs to structure the strategy, to adjust the tactics and the struggles of everyday life based on this strategy, to support the working class for a better life, out of the EU, without exploitation, since there is no improved life within the EU; the latter cannot be reformed. The EU has its own structural features and rules, it is impossible to reform them. Overthrowing the EU is a crucial step in the wider anti-capitalist struggle, towards a more just, fair, equal society, but of course it does not certify it. So, it is a necessary, but not sufficient step.

From this perspective, questioning the EU should be associated with the bigger question about who owns the economy. If the Left does not ask this question, then the chances to get into the nationalist trap increase dramatically. Overthrowing the EU is not sufficient on its own. The overthrow of the EU should be associated with a wider spectrum of immediate demands that would relieve working class people, such as write off the public debt, public health and educational system, nationalisation of the banking sector and key industries under workers’ control, decent jobs, rise in wages and pensions, stable work with rights against the flexible work, against fascism, racism, and war. All these simply cannot happen within the EU.

How to do it?

We need to create anti-EU initiatives in each EU member state which will be connected with the labour movement and then be unified at a European wide level. From this perspective, we need to fight for the overthrow of the EU, not just the exit of a country. In this way, the Radical Left can highlight the wider role of the EU, weaken far right and nationalist ideas, and connect this fight with the wider struggle. Can we do it in the UK? I think that there is always time. We need more imagination, to vision another type of society and economy. We need to get stronger by the result of the referendum and change the things. This popular ‘the country is divided’ is in reality a class divide, the poor said enough with this, ‘we are fed up’, we cannot offer these people to the far right! However, we need the left to start organising and mobilising the working class, otherwise others will do it, as they already do.

Several times the Radical Left postpones discussions and actions for crucial issues, like the EU or even the social change, to the future, like they cannot happen anytime. However, this is a methodological mistake! Labour movement trajectory is not linear, its historical trajectories have been full of wild fluctuations! This is a certain weakness of the Left. Moreover, we are not at this stage at the moment. The issue of the EU is now, more topical than ever, especially after Brexit. This dilemma Remain in the EU or Brexit under Tories is fake. We just need to respond immediately. We need to act now, to mobilise the working class for an internationalist workers and migrant friendly anti-EU, European wide struggle, otherwise history, once again, will not treat both the society and the left in a good way. We can always win!

The intervention of Simon Elmer in the event about the EU and the Radical Left

Posted: June 19, 2019 | Author: | Filed under: Uncategorized | Leave a comment

Leaving the Garden: Brexit and the Housing Crisis

In the good old days – before 23 June 2016 – when barely a week passed without some new demonstration or protest against the latest round of austerity measures, cuts to benefits, Atos deaths, privatisation of the NHS, dismantling of the welfare state, erosion of civil liberties, expansion of police powers, deportation of immigrants or declaration of war, it was still widely agreed that the most pressing political issue in the UK was the crisis of housing affordability. Four years later, that issue has fallen down the hierarchy of the public’s attention. Why campaign to save something as boring as social housing when you can SAVE THE WORLD? But housing is not only an aspect of British life about which, drawing on the work of Architects for Social Housing, I can speak with some knowledge about how it has been influenced by our membership of the European Union; it is also where different strands of UK society – economic, political and social – converge.  Housing, therefore, is a prism through which to test the truth value of the claims about our membership of the EU, as well as the counter arguments for leaving. I can’t today go into the arguments for remaining, but they all imply that since 1973, when the UK belatedly joined the European Economic Community, we’ve been living through a Golden Age of economic growth and wealth creation, of unprecedented peace between the formerly warring nations of Europe, of multicultural tolerance and the rule of human rights in this best of all possible worlds. But what does housing reveal about the economic, political and social realities of the pre-Brexit Garden of Britain from which, like a modern-day Adam and Eve, we’re so rashly attempting to eject ourselves?

1. UK Housing in the European Union

Unlike, for example, the way the European Union’s 4th Railway Package has imposed the privatisation of their railway services on member states, the influence of EU legislation on housing provision is less clear cut. The line between Neo-liberalism as a late stage of capitalism since the 1970s and the EU as a legislative instrument of its implementation is blurred – or at least it is to me, as I am not an expert on EU legislation. But current UK housing policy, which I do know something about, is based on three neo-liberal principles:

  1. That attracting investment in UK residential property from the private sector, including foreign investors, overseas buyers and offshore financial jurisdictions, should be the primary source of revenue for house building;
  2. That according to the law of supply and demand, massively increasing the supply of residential properties for market sale will reduce house prices in general;
  3. That the sale of prime and super-prime residential properties for the highest possible market price will cross-subsidise the provision of the so-called ‘affordable housing’ in which UK citizens can afford to live.

Now, all three of these principles are fundamentally flawed as a model for the provision of housing need:

  1. Because private investment in the UK property market has transformed our housing into a global commodity, with investors, for example, speculating on shares in the value uplift consequent upon planning permission being granted on a piece of land they will never see and which may never even be developed;
  2. Because the law of supply and demand doesn’t describe this property market, whose financialisation by global capital has driven prices up, as it is intended to, rather than down;
  3. Because far from cross-subsidising even affordable housing, let alone homes for social rent, such investment is instead funding the estate regeneration programme that is demolishing tens of thousands of council homes to make way for the development of primarily market-sale properties.

As a result of these policies, between 2014 and 2016, around one in six new-build residential properties in London were sold to overseas investors. In 2017,  that figure rose to 30 per cent; and in the second half of 2018, overseas investors purchased 57 per cent of all homes in Central London. Although some overseas buyers might use their property as a home for a week or so during the year, most investors are either buy-to-let landlords or speculators on London’s housing market.

Partly as a result of this investment, the total value of the UK housing stock in 2018 was £7.29 trillion, having risen by a third over the last decade alone. Nobody will be surprised to hear that £1.77 trillion of that housing stock is in London, nearly a quarter of the total. Equivalent to 3.45 times the gross domestic product of the UK, and nearly 60 per cent of the UK’s entire net wealth, the UK property market now constitutes an economy in itself. And it is this that UK housing policy is being written to keep afloat – at the cost of the housing of its citizens.

58 per cent of housing demand in London is for lower-mainstream properties and homes for sub-market rent; yet only a quarter of the properties with planning permission in the five years between 2017 and 2021 will go on sale at this price. As a result, the number of unsold residential properties under construction in London reached a record high of 31,500 last month; while the total number of unsold new-build properties on sale for more than £1 million has hit a record high of 3,000 units. At the other end of the financial scale, of the 45,500 residential units  completed in London in 2016/17, only 16 per cent were even affordable housing; and of these, a mere 5 per cent were for social rent, the lowest cost and most in demand tenancy type. The remaining 84 per cent was for market sale properties.

In the decade since the financial crisis, London house prices have risen from an average of £245,000 in April 2009 to £463,000 today. That’s more than thirteen times the average London salary of £35,000. In Inner London, the average price of a new-build property is now £786,000. Meanwhile, rents on London’s private market, in which 30 per cent of London households have to find a home, have risen to an average of £1,617 per month, 73 per cent higher than the UK average of £936. The total rent paid by UK tenants last year rose to £51.6 billion, more than double the £22.6 billion they paid in 2007.

At the same time, there are 20,000 long-term empty homes in London alone, with more than ten times that number across England. Extraordinarily, half of the residential units in London’s new-build developments currently stand empty. Unsurprisingly, the likelihood of a residential property being empty rises with its market value. 39 per cent of properties worth between £1 million and £5 million are currently under-used, a figure that rises to 64 per cent for properties worth more than £5 million. Of the properties purchased by overseas investors, an appalling 42 per cent stand empty.

As a result of what the European Union would describe as this ‘liberalisation’ of UK housing provision, at the end of 2018 there were an estimated 165,000 people homeless in London, or 1 in 52 of the capital’s population, and over 300,000 homeless across the UK. These numbers, however, don’t include the hidden homeless, with an estimated 1 in 5 people under the age of 25 having couch-surfed last year – 225,000 of them in London. Roughly the same number, 244,000, are on council housing waiting lists in London. While across England, 1.16 million households are waiting for a council home.

Given the lack of response from the British public to the causes of this housing crisis, either in the polling booth or on the streets of London, my very strong suspicion is that middle-class Remainers in general care very little about the negative effects of Neo-liberalism on the working class so long as they continue to profit from it themselves, most noticeably from the rising value of their homes. Their well-mannered protests are not against the threat of these figures worsening if we leave the European Union, but expressive of their fears of becoming the victims, rather than the beneficiaries, of the Neo-liberalism responsible for them. Whether they know it or not – whether they admit it or not – those who vote to remain in the European Union are voting for more of the same if not worse.

2. UK Housing after the Referendum

In May 2016, the Sunday Times Rich List reported that 26 of the 100 wealthiest people in the UK listed property as a major source of their wealth; while among the richest 1000 there were 164 property moguls with a combined wealth of £143.7 billion. Perhaps unsurprisingly, the next month the UK Referendum returned a vote to leave the European Union by 52 per cent on a 72 per cent turnout of the UK electorate, some 17.4 million people. Since then, the value of the pound has fallen from €1.26 and $1.42 to, at the beginning of this week, €1.12 and $1.27, or 12 cents in the Euro and 15 cents in the US dollar. The immediate effect of this fall was that, by November 2016, 406,000 Britons had lost their status as dollar millionaires. More importantly, however, was the drop in investment in UK housing, and especially in London, as a safe place for global capital.

As an example and case study of this disinvestment, one of the schemes for which ASH has proposed design alternatives is the West Kensington and Gibbs Green council estates in Hammersmith and Fulham, whose residents we worked with in the 8 months leading up to the Referendum. Five years earlier, in June 2011, Capital & Counties Properties (or Capco), which also owns the adjoining Earl’s Court site, submitted a planning application to demolish and redevelop both estates. In September 2012, despite the scheme being opposed by 80 per cent of residents, Hammersmith and Fulham council granted outline planning permission; and the following April both estates were stock transferred to Capco for £90 million. This was later estimated to be less than 10 per cent of their market value at the time.

Capco’s scheme proposed demolishing the 760 homes on the existing estates and replacing them with a total of 7,500 residential properties spread across the combined sites. Over 800 of these have been built on the Lillie Square development to the south, where 2-bedroom apartments went on sale for £1.2 million. 89 percent of the additional homes were to be for market sale, with none set aside for social rent. The 760 new dwellings allocated to replace the demolished council homes on the two estateswould be a mix of affordable rent, rent-to-buy schemes and shared ownership properties far beyond the reach of most Londoners.

It was thanks to cowboy schemes like this – and there are hundreds of them across London – that in the two years before the Referendum the UK property market expanded by £400 billion. However, in the uncertainty leading up to the Referendum, share prices for Capco started to drop, falling from £4.72 in August 2015 to £3.27 in March 2016. Following a slowdown in sales for the apartments in Lillie Square, Capco’s Managing Director said he feared the market for high-value residential dwellings in London was falling. He was right.

While the West Kensington and Gibbs Green estates are still standing, the demolition of the Earls Court Exhibition Centre began in December 2014, since which time the site has lost more than half its value. In fact, Capco’s land holdings in the venture lost 10.5 per cent of their value in the first three months of 2019 alone. According to a recent valuation, Capco’s share of the site is now worth £412 million, down from a pre-Referendum peak of £803 million in 2015.

As a result, despite sitting on planning permission since 2012, not a single unit of luxury housing has been built on the former Earl’s Court site. Last year Capco began looking for buyers on which to offload at least part of the land, but nobody has yet come forward. Capco’s share price has continued to drop, falling 54 per cent since its 2015 peak. Capco has admitted that this has primarily been down to a reduction in the gross development value of the site once building work is completed. Last month, Hammersmith and Fulham council announced it would be raising the capital to compulsory purchase the land on which the two council estates stand.

When outraged liberals demand to know how I can possibly be in favour of Brexit, I point to the levelling-off of house prices in England and the drop in house prices in London since the Referendum; to the pause in London’s estate demolition programme as overseas and offshore investors pull out of the UK property market; and to the fall in land values consequent upon both. These perceived negatives in the supposedly absolute good of economic growth on which capitalism relies for its profits are in effect positive forces against the so-called liberalisation of UK housing. Removing the barriers to re-nationalising housing provision in the UK, such as the EU-enshrined prohibition on State Aid, will require far more than leaving the European Union, beginning with overthrowing half a century of neo-liberal orthodoxy. But just the threat of doing so has already removed some of the financial incentives to continue pursing UK housing policy based on the investment needs of global capital rather than the housing needs of the UK population.

However, there’s a caveat to all this. Markets recoil from uncertainty, and perhaps – when Boris Johnson is installed in No. 10, as seems likely, and the new government removes what’s left of our building and planning regulations before inventing further financial incentives for the global ruling class to invest even more of their dirty money in UK property – the market will recover, and we really will look back on the years before Brexit as the ‘good old days’. But I don’t think so. Perception is crucial to markets, and since the Referendum dropped a turd into the cocktail-glass of Europe, London has lost its reputation as the second home for Europe’s jet-setting classes. So the customer base has contracted. Just as importantly, 275 City firms and £900 billion of financial assets have relocated out of the UK. That’s a lot of bankers, hedge-fund managers, financial advisors and corporate lawyers who will no longer be living or investing in London property. Most importantly of all, the Referendum, followed by the recent European Parliament Elections, have shown that the UK can no longer be regarded as under the thumb of the Conservative-Labour monopoly that will underwrite any sudden collapse in property values if and when the housing bubble bursts, as it did the banks after the global financial crisis. Perhaps, as some have predicted, the UK will become an offshore tax jurisdiction for global capital under the umbrella of US imperialism – although some would say London has already been that for some time. But there is another possibility.

3. The UK after Brexit

I doubt any of us who have suffered from the fiscal policies of austerity over the past decade have noticed the benefits of living in a country with the fifth largest economy in the world. Despite this, one of the apparently decisive arguments for remaining in the European Union is that a smaller GDP for a post-Brexit UK will increase social inequality. Now, the Gross Domestic Product of the world in 2018 was $80 trillion US dollars, and over a quarter of that, $20.5 trillion, came from the United States of America. To test the argument that greater national wealth means wider distribution of that wealth you only have to look at the US, the richest country in the history of the world, where wages have not increased in real terms since the 1970s, which has no national health cover, the highest number and percentage of citizens in prison of any country in the world, the highest spending on the military of any country in the world, a corrupt, politicised and militarised legal system, an institutionally racist police force and a fascist game-show host for a President. If that’s what a quarter of the world’s GDP gets you, maybe we could do with a different measure of the ‘wealth’ of our society.

Most of us have lived our entire lives within one form or other of the European Union, a period co-extensive with the rise of Neo-liberalism as the dominant economic and political system in Western democracies. And after 46 years of Neo-liberal governments, Conservative, Labour, Coalition and Conservative again, there is perhaps no more ideologically hegemonic country in Europe than the UK. Until now.

Whatever its consequences for us – and that will depend on what we do after we leave the EU – the threat of Brexit has opened a wound in the hegemony of Neo-liberal capitalism. This accounts, I’d suggest, for the almost exclusively and overwhelmingly emotive character of the reactions to it, as if we’re religious fanatics who have been told our God is dead and it’s time to find a new meaning to our lives. Personally, I’m a great believer in killing gods, which is the point of departure for the self determination of the working class kept servile by their worship. The apparently firm conviction that, free from the maternal embrace of Europe’s fulsome breast, we will automatically fall into the paternal grasp of our evil fathers, whether Boris Johnson or Donald Trump, shows just how childish and subservient we’ve become as an electorate, apparently capable only of choosing which brand of Neo-liberalism our political parties spoon feed us. It’s a measure of how complete has been the defeat of the political Left in this country that the only way liberals can think to defend themselves from the Conservative Right is to cling to the skirts of the European Union. If we’d spent half the effort we’ve squandered over the past three years arguing why we should remain part of the Neo-liberal Empire instead working to create a socialist alternative, we could be on the verge of a period of genuine political and economic change in the UK. We’re not. But that work starts now.

As the example of Greece has so brutally demonstrated, the European Union will not allow the democratically-elected socialist government of a member state to govern in anything but name. Unlikely as it may seem in this most conservative of countries, if the UK is ever to have a socialist government which, unlike Syriza, is not under the yoke of the unelected troika of the European Commission, the European Central Bank and the International Monetary Fund, escaping the iron grip of the European Union is the first –  insufficient – but necessary step. Eating from the tree of knowledge always has its consequences, but how much longer do we want to live in ignorance and obedience to the God of Neo-liberalism?

 

Video of the recent ANTARSYA UK event about the EU and the Radical Left

Posted: June 17, 2019 | Author: | Filed under: Uncategorized | Leave a comment

ANTARSYA UK organised a successful event in a crowded room about the topical issue of the EU and the stance of the Radical Left. A useful and lively debate followed the presentations of the speakers (Simon Elmer, Michael Roberts, Nikos Kapitsinis). You can watch the video of the entire event here

The interventions of each speaker will follow soon.

Event: EU and the Radical Left

Posted: June 11, 2019 | Author: | Filed under: Uncategorized | Leave a comment

In the aftermath of the euro elections, the discussion around the EU and its features is deepening. New challenges rise as the wave of questioning the EU since the early 2010s, in the aftermath of the capitalist crisis, dominates the public debate. It is of great concern that this wave is directed towards the far right across the whole EU, although during the last 10 years, the working class and the youth in the EU fought from a progressive perspective so that they wouldn’t pay for the crisis that they did not cause. More recently, the yellow vests movement and the youth struggle against climate change have offered fresh hope to the radical left politics in the EU.

These movements have revealed the reactionary and anti-social structural character of the EU, which covers several dimensions. First, the political, with the EU being the ‘headquarters’ of neoliberal restructuring and reactionary policies, constituting the pillar for resolving the capitalist crisis with banks’ bailouts and huge deterioration of working class people’ living standards. Second, the economic, with the structural division of the EU between the core and periphery. Third, the migration perspective, with the EU forcing millions of poor and unemployed people from the periphery to the core, seeking deeper forms of exploitation, while acting as a fortress against the refugee flows that it caused by joining imperialist invasions. Fourth, the environment, with the EU promoting ‘environmentally friendly’ measures of small and ambiguous efficiency, while allowing the large multinationals making irreversible damage to the environment. Finally, the EU has an important role in the housing restructuring, facilitating the huge urban sprawl, the division between urban and rural areas, the spatial division of cities between poor and rich areas, the huge rise of housing prices, and thus the significant increase of homeless people.

For all these reasons, members of ANTARSYA, the Greek anticapitalist front, living in the UK, organise an event around the analysis of the EU and the response from a radical left perspective. We want to contribute to and deepen the ongoing discussion in terms of the ‘nature’ and structural features of the European capitalist integration. We invite individuals and political forces that consider the question of the political struggle in Europe a relevant cause in order to enrich the debate around the political strategies that the radical left and the labour movement must develop in order to respond.

Speakers include:
Michael Roberts, Marxist Economist
Simon Elmer, Architects for Social Housing
Eddie Dempsey, RMT Union
Nikos Kapitsinis, ANTARSYA UK

Saturday, June 15, 17.00, SOAS University, Room DLT, London

 

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