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| Version 4 | Version 5 |
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| Brexit has made Labour's radicalism possible - but it could bury it too | Brexit has made Labour's radicalism possible - but it could bury it too |
| (5 days later) | |
| A misguided aversion to the single market is blinding the party leadership to the economic harm of leaving the EU | A misguided aversion to the single market is blinding the party leadership to the economic harm of leaving the EU |
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| Fri 29 Sep 2017 19.34 BST | Fri 29 Sep 2017 19.34 BST |
| Last modified on Wed 14 Feb 2018 15.31 GMT | |
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| It’s hardly thrilling, and an unlikely bestseller, but if you were to attempt to render Britain’s current politics, especially those at play in the Labour party, as a page-turning blockbuster in the style of Robert Ludlum, it could only have one title: The Brexit Paradox. | It’s hardly thrilling, and an unlikely bestseller, but if you were to attempt to render Britain’s current politics, especially those at play in the Labour party, as a page-turning blockbuster in the style of Robert Ludlum, it could only have one title: The Brexit Paradox. |
| In fact, there’s enough material for a series, given the myriad paradoxes and tensions at work when it comes to Labour and Europe. The most basic is that Labour is a party whose members, activists and MPs are overwhelmingly for remain – and yet seven in 10 Labour-held seats voted leave in last year’s referendum. What’s more, the leader of this passionately pro-EU party is one of only a handful of Labour MPs with a long record of Euroscepticism: he voted against remaining in 1975, against the Maastricht treaty in 1993, against Lisbon in 2009. And yet Jeremy Corbyn’s most devoted supporters include two groups who are clearest in seeing the benefits of the EU: young people and trade unionists. | In fact, there’s enough material for a series, given the myriad paradoxes and tensions at work when it comes to Labour and Europe. The most basic is that Labour is a party whose members, activists and MPs are overwhelmingly for remain – and yet seven in 10 Labour-held seats voted leave in last year’s referendum. What’s more, the leader of this passionately pro-EU party is one of only a handful of Labour MPs with a long record of Euroscepticism: he voted against remaining in 1975, against the Maastricht treaty in 1993, against Lisbon in 2009. And yet Jeremy Corbyn’s most devoted supporters include two groups who are clearest in seeing the benefits of the EU: young people and trade unionists. |
| Striking as all these paradoxes are, they are not the most important. The one that matters is this: Brexit has helped make the radicalism of Corbyn possible, but it also poses the greatest threat to its success. | Striking as all these paradoxes are, they are not the most important. The one that matters is this: Brexit has helped make the radicalism of Corbyn possible, but it also poses the greatest threat to its success. |
| That Brexit has opened the door to the Corbyn project was powerfully explained earlier this week by my colleague Rafael Behr. He argued that the Tories had lost the right to dismiss socialist programmes as impossibilist or utopian since the most ardent Brexiteers were engaged in an impossibilist, utopian mission of their own, one anchored in ideological faith with only the weakest tether to reality. Now that wild-eyed, revolutionary talk is the idiom of Conservative cabinet ministers, it breaks no taboo when Labour also offers to upend the status quo. Through Brexit, incautious radicalism has been legitimated by the party whose raison d’etre was once to resist such things on principle. | That Brexit has opened the door to the Corbyn project was powerfully explained earlier this week by my colleague Rafael Behr. He argued that the Tories had lost the right to dismiss socialist programmes as impossibilist or utopian since the most ardent Brexiteers were engaged in an impossibilist, utopian mission of their own, one anchored in ideological faith with only the weakest tether to reality. Now that wild-eyed, revolutionary talk is the idiom of Conservative cabinet ministers, it breaks no taboo when Labour also offers to upend the status quo. Through Brexit, incautious radicalism has been legitimated by the party whose raison d’etre was once to resist such things on principle. |
| So this week John McDonnell could promise a sweeping programme of renationalisation without looking any more bold or reckless than the government wrenching us out of a set of arrangements that has brought relative peace and prosperity for 40 years. But while Brexit opens one door for Labour, it threatens to slam a heavier one in its face. | So this week John McDonnell could promise a sweeping programme of renationalisation without looking any more bold or reckless than the government wrenching us out of a set of arrangements that has brought relative peace and prosperity for 40 years. But while Brexit opens one door for Labour, it threatens to slam a heavier one in its face. |
| I’m not referring to the obvious risk of internal division, pitting leavers against remainers. So far, the party has managed that divide quite effectively (even if it meant stifling a Brexit vote on the conference floor). No, this rift runs further, even into the inner circle of senior Labour figures wholly loyal to the leader. | I’m not referring to the obvious risk of internal division, pitting leavers against remainers. So far, the party has managed that divide quite effectively (even if it meant stifling a Brexit vote on the conference floor). No, this rift runs further, even into the inner circle of senior Labour figures wholly loyal to the leader. |
| At the root of it is the belief, particularly associated with McDonnell, that membership of the single market would tie the hands of a Corbyn government. In this view, EU rules on competition and state aid will hold Labour back from reshaping the British economy, preventing it from renationalising rail, water, energy and the postal service. | At the root of it is the belief, particularly associated with McDonnell, that membership of the single market would tie the hands of a Corbyn government. In this view, EU rules on competition and state aid will hold Labour back from reshaping the British economy, preventing it from renationalising rail, water, energy and the postal service. |
| It’s this fear, above all, that underpins the leadership’s resistance to giving an open-ended commitment to remaining inside the single market. (It took a Herculean effort by shadow Brexit secretary, Keir Starmer, to get the party to accept continued membership through a transition period of up to four years.) Corbyn believes none of this should come as a surprise: after all, he raised these worries during the 2016 referendum campaign, when his stance was “remain and reform”. If he advocated a change in, say, EU state aid rules when Britain was inside the EU, why on earth would he want to comply with them once Britain had left? The message from Labour’s high command to ardent remainers is not to get hung up on specific institutional forms – such as single market membership – but rather to focus on outcomes, such as negotiating a good deal with the EU that helps British jobs. | It’s this fear, above all, that underpins the leadership’s resistance to giving an open-ended commitment to remaining inside the single market. (It took a Herculean effort by shadow Brexit secretary, Keir Starmer, to get the party to accept continued membership through a transition period of up to four years.) Corbyn believes none of this should come as a surprise: after all, he raised these worries during the 2016 referendum campaign, when his stance was “remain and reform”. If he advocated a change in, say, EU state aid rules when Britain was inside the EU, why on earth would he want to comply with them once Britain had left? The message from Labour’s high command to ardent remainers is not to get hung up on specific institutional forms – such as single market membership – but rather to focus on outcomes, such as negotiating a good deal with the EU that helps British jobs. |
| The trouble with all this is that it rests on a false premise. Last week two scholars of EU competition law published a study of precisely this question and concluded starkly that “EU law is no barrier to Labour’s economic programme”. As anyone who has travelled on a French or German train knows, public ownership is common across the continent. True, there are EU rules against monopolies – public and private – but all that would mean is that a future British Rail 2.0 might have to allow a European freight company access to UK tracks (thereby enabling rail to compete for international freight business with environmentally unfriendly planes and trucks). | The trouble with all this is that it rests on a false premise. Last week two scholars of EU competition law published a study of precisely this question and concluded starkly that “EU law is no barrier to Labour’s economic programme”. As anyone who has travelled on a French or German train knows, public ownership is common across the continent. True, there are EU rules against monopolies – public and private – but all that would mean is that a future British Rail 2.0 might have to allow a European freight company access to UK tracks (thereby enabling rail to compete for international freight business with environmentally unfriendly planes and trucks). |
| Of course, there are rules to navigate around, but as our EU neighbours demonstrate daily, there’s plenty of wriggle room. When Gordon Brown moved to nationalise RBS during the crash, the EU posed no obstacle. And, to take one example, British governments long subsidised the plane-maker Bombardier’s Belfast operation without the EU standing in the way. | Of course, there are rules to navigate around, but as our EU neighbours demonstrate daily, there’s plenty of wriggle room. When Gordon Brown moved to nationalise RBS during the crash, the EU posed no obstacle. And, to take one example, British governments long subsidised the plane-maker Bombardier’s Belfast operation without the EU standing in the way. |
| Which brings us to a crucial point. This week the United States Department of Commerce slapped a tariff on Bombardier because of that state aid – proof that even if we made a clean break from the EU and its single market, the British government would not be an island unto itself. “Socialism in one country” is a fantasy in today’s interconnected world. We could shake off the supposed shackles of Brussels, only to find ourselves still constrained by the World Trade Organisation. | Which brings us to a crucial point. This week the United States Department of Commerce slapped a tariff on Bombardier because of that state aid – proof that even if we made a clean break from the EU and its single market, the British government would not be an island unto itself. “Socialism in one country” is a fantasy in today’s interconnected world. We could shake off the supposed shackles of Brussels, only to find ourselves still constrained by the World Trade Organisation. |
| Indeed, one senior Labour figure notes that leaving the EU will compel us to make a trading alliance with one of the other two mighty global economic blocs: either the US or China. If we think loss of sovereignty is an issue with the EU, wait till we try our luck with Washington. “Their approach to a trade negotiation is, ‘Here’s the rules: sign here.’” | Indeed, one senior Labour figure notes that leaving the EU will compel us to make a trading alliance with one of the other two mighty global economic blocs: either the US or China. If we think loss of sovereignty is an issue with the EU, wait till we try our luck with Washington. “Their approach to a trade negotiation is, ‘Here’s the rules: sign here.’” |
| Still this is not the heart of the matter. The reason why Brexit could upend Labour’s plans is more basic than that: leaving the EU will make the British economy poorer. Witness the riposte from the Institute for Fiscal Studies to Boris Johnson’s revival of the bogus £350m figure: far from bringing in money, Brexit will cost us £300m a week. Today new figures showed the weakest rate of UK economic growth since 2013. | Still this is not the heart of the matter. The reason why Brexit could upend Labour’s plans is more basic than that: leaving the EU will make the British economy poorer. Witness the riposte from the Institute for Fiscal Studies to Boris Johnson’s revival of the bogus £350m figure: far from bringing in money, Brexit will cost us £300m a week. Today new figures showed the weakest rate of UK economic growth since 2013. |
| All but the most deluded Brexiteers concede that departing from the EU will hurt the economy, for a few years at the very least. Corbyn and McDonnell have big plans that will cost big money. But, thanks to Brexit, they will find less cash in the coffers, and less market willingness to lend the country any more. They will face early the shadow that has hung over every reforming Labour government: the prospect of the money running out. | All but the most deluded Brexiteers concede that departing from the EU will hurt the economy, for a few years at the very least. Corbyn and McDonnell have big plans that will cost big money. But, thanks to Brexit, they will find less cash in the coffers, and less market willingness to lend the country any more. They will face early the shadow that has hung over every reforming Labour government: the prospect of the money running out. |
| This is what should keep Labour’s ruling circle up at night. It’s not the EU that could turn their dreams to ashes – it’s leaving the EU that could do that. | This is what should keep Labour’s ruling circle up at night. It’s not the EU that could turn their dreams to ashes – it’s leaving the EU that could do that. |
| • Jonathan Freedland is a Guardian columnist | • Jonathan Freedland is a Guardian columnist |
| Brexit | Brexit |
| Opinion | Opinion |
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| John McDonnell | John McDonnell |
| Jeremy Corbyn | Jeremy Corbyn |
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