Downloading PDF. Please wait... Issue 2493

The bosses’ EU blocks the policies that help workers

This article is over 8 years, 1 months old
‘Captains of industry’ love the European Union because it helps them profit. And a new deal has them licking their lips. Socialist Worker investigates
Issue 2493
A bunch of men in suits: The European Round Table of Industrialists
A bunch of men in suits: The European Round Table of Industrialists (Pic: Herman Van Rompuy/Flickr)

Time and again politicians use “European laws” as an excuse for why services have to be outsourced or why our railways can’t be renationalised.

Successive political leaders have wrung their hands while arguing for Britain to remain in the European Union (EU).

The pro-EU Labour and Scottish National parties, and most trade union leaders, say we need to be in the EU to fight for more “social” policies.

But the EU’s driving principle has always been about what is good for business.

It is a rich man’s club and an economic trading bloc, not a safety net for workers and the poor.

The “four freedoms” that underpin the EU are the free movement of goods, services, capital and labour. But they aren’t all equal.

All restrictions on bosses’ ability to make money, by whatever means, “shall be prohibited” a founding treaty decreed.

But these same “freedoms” don’t apply to people.

It’s true that EU citizens can move around with relative ease, especially compared to people born outside the walls of Fortress Europe, but EU states still retain the right to close their borders.

Capital faces no such restrictions. For the European Round Table of Industrialists (ERT) the key benefit of the EU is the “500,000,000 customers” it gives them access to.

The ERT is a powerful corporate lobby group, representing around 50 CEOs of European-based multinationals.

It supports David Cameron’s campaign to keep Britain in the EU, as does the bosses’ CBI, which wants to “preserve the advantages of membership” to maintain company profits.

At every opportunity appointed EU commissioners further entrench the bosses’ position using their economic clout. This is clear from the new TTIP trade deal (see below).

They also try to turn every crisis into an opportunity. When EU states bailed out financial institutions during the first three years of the economic crisis—to the tune of £3.5 trillion—they amassed huge public debt, creating the “sovereign debt crisis”.

The ERT was quick to argue that this was “an opportunity to rethink the European Union’s future course and to take decisive action”.

The EU-led regime to bail out European countries unable to cope with rising debt—combining the European Commission, the European Central Bank and the International Monetary Fund—became known as the Troika.

The Troika’s “rescue packages” demanded privatisation, cuts to social spending, wage and pensions cuts and attacks on workers’ rights.

But these caused deeper recession and huge social crisis in countries such as Greece, Ireland, Spain and Portugal.

The fire sale of public assets and austerity ordered by the Troika has become central to maintaining the profitability of European corporations, despite the social devastation it has caused.

Weakening the bosses’ club would be a boost to every anti-austerity struggle in Europe.

That’s we should vote to dump it in June.

Deal will rip up NHS­, so why won’t Labour oppose it?

On the TUC protest in defence of the NHS in Manchester in 2013

Protesting for the NHS (Pic: Guy Smallman)

The Transatlantic Trade and Investment Partnership (TTIP) is a proposed deal between the EU and the US. It could allow the privatisation of huge swathes of the public sector and make its reversal illegal.

Corporations would be able to sue a government if its laws and regulations make it difficult for them to make a profit.

This already happens under some treaties.

The German state is being sued by Vattenfall, a Swedish energy company, for over £3 billion for partially disinvesting from nuclear power.

TTIP is part of a strategy to create a cohesive trading block capable of competing with global powers such as China.

To do this, a common economic policy needs to be forged, in part through legal action and diplomatic bullying.

The European Round Table of Industrialists sees TTIP as a “unique opportunity to set the rules for trade and investment that could serve as a benchmark for the rest of the world”.

It wants to “remove all remaining market access barriers, especially in the services sector” and give unfettered “access for companies to public procurement markets”.

In Britain, the NHS is a major target for privatisation.

Labour leader Jeremy Corbyn says that, if elected, he will reverse any NHS privatisation. But TTIP will make this illegal.

Corbyn’s response to TTIP has been to declare that, “Human rights ought to be a part of that treaty, as it should be a part of all treaties.”

Given the scale of the attack, this is inadequate.

Like the Tories, the Labour right wing support EU-enforced privatisation.

Corbyn has sacrificed his opposition to the EU for the sake of party unity.

If he wants to undo privatisation he will need to challenge the EU and challenge his enemies inside Labour.

Proposed legal challenges to EU privatisation are unlikely to win—though it is possible to defy the rules.

But arguing for a left exit in the referendum can help to save public services and pull apart the bosses’ club.

Don’t forget to add on my fee

After the Tory selloff of Royal Mail in 2013 “financial advisors and asset managers” Lazard made £8 million in a week. The firm grabbed shares cheap through its priority investor status then quickly sold them on.

It then pocketed £1.5 million in fees for its adviser role.

In February 2015 the Spanish government sold a 49 percent stake in its airport authority. Lazard netted a 60 percent profit within a month in the same way.

Taking the rise out of Greeks

The Troika struck a deal last summer for Greece to sell 14 of its most profitable regional airports, near popular tourist destinations.

German firm Fraport got a 50-year deal to run them, while Lufthansa played an advisory role in the bargain selloff.

Besides Lufthansa, which did well out the deal, the German state pushed hard for Greece to privatise assets. It owns 51 percent of Fraport.

Heads they win, tails you lose

Law firms have made a killing from privatisation in the EU. Shearman and Sterling LLP boast of having been involved in over 100 privatisations in 27 countries.

Economic crisis has been good to them, and not just from drawing up the selloff documents.

They have also helped firms put in claims for huge damages, worth hundreds of millions of pounds, from states forced by the Troika to cut subsidies.

Sign up for our daily email update ‘Breakfast in Red’

Latest News

Make a donation to Socialist Worker

Help fund the resistance