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That progressive paradise (aka the EU) does it again!

Summary:
I saw a Tweet overnight suggesting the so-called progressive British Remainers had been a little quiet in recent days following the comical display of anti-democratic, corporatism aka filling leadership positions in the EU and the Eurozone. Where are they? Why aren’t they out there in the media (social or otherwise) extolling the virtues of their much-loved European Union, where progressive policies are the norm and the peoples’ interests are held above the narrow corporate interests? The problem is that they cannot show up at present. The EU has managed to appoint a cabal of new leaders, many of whom are plagued by past scandals, allegations of nepotism, convictions for negligence in public office, and the Presidential nominee is under investigation in the Bundestag and has been

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I saw a Tweet overnight suggesting the so-called progressive British Remainers had been a little quiet in recent days following the comical display of anti-democratic, corporatism aka filling leadership positions in the EU and the Eurozone. Where are they? Why aren’t they out there in the media (social or otherwise) extolling the virtues of their much-loved European Union, where progressive policies are the norm and the peoples’ interests are held above the narrow corporate interests? The problem is that they cannot show up at present. The EU has managed to appoint a cabal of new leaders, many of whom are plagued by past scandals, allegations of nepotism, convictions for negligence in public office, and the Presidential nominee is under investigation in the Bundestag and has been acknowledged as a failure in her management of the German defense department. Come to think of it they seem perfect for the top jobs in the EU. And how was this motley lot selected? By denying even the limited sense of democracy that has been present in this process in the past. It is beyond a joke. But then this is the Europhile cosmo left’s vision for the future. One could not dream all this stuff up one they tried.

The accepted method of selecting candidates for the EU’s top administrative and political jobs was the so-called Spitzenkandidat (lead candidate) system.

It gave a semblance of democracy to the process.

The process is that voters in each Member State elect people to the European Parliament. The political parties that are represented in the European Parliament have what is called a ‘lead candidate’ for the European Commission Presidency.

Remember that the European Parliament parties are hybrids of the political parties that contest national elections. They form among elected representatives from different Member States who share similar ideological positions.

The ‘lead candidate’ is then elected from these created coalitions in the European Parliament.

The norm is that the majority European party (or coalition) would usually expect their lead candidate to be the next European Commission President.

An interaction with the European Council then follows and the Spitzenkandidat is confirmed if a majority of the European Parliament assents.

Mandred Weber from the European People’s Party (EPP), a right-leaning coalition, was the Spitzenkandidat this time around.

Under this system, the European Parliament also, nominates the other candidates for the remaining top positions – ECB President, EU Foreign Affairs head, and European Council President.

So a semblance of democracy.

But the system failed dramatically in the recent choices. The totally unelected European Council dominated the process and the semblance of democracy vanished.

Welcome to the EU 2019-style.

The cabal is firmly entrenched and is now openly scathing of any pretensions to democratic processes.

Further, the characters the cabal has assembled have been plagued by scandals, incompetence, nepotism or sheer ignorance of international affairs.

So not only do the nominations violate any sense of linkage to what people might have voted for, they are also demonstrative of a further shift towards austerity and corporatism.

They entrench the domination of the large nations in Western Europe and ignore the new accessions.

However, there has not been much said about any of this from those British remainers who just love the EU.

This Al Jazeera article (July 4, 2019) – The new rulers of Europe – provides some insight into the candidates which must now be ratified. It is somewhat incomplete but gives some guide.

This report (in German) – Wehrbeauftragter be­klagt „Über­orga­ni­sa­tion“ in der Bundes­wehr (January 29, 2019) – documents the problems that the German Defence Department had under the leadership of the new nominee for the European Union Presidency, Ursula von der Leyen.

The Report published by the Military Commissioner of the Bundestag (I am translating) assesses the peformance of the Defence ministry in Germany in 2018.

It concluded that:

1. There were daily shortages in materials and equipment faced by the German military due to under spending.

2. The department was over administrated by bean counters – a ‘bureaucratic monster’.

3. Funding was grossly wasted on cost overruns and mishandling of public money.

4. Equipment choices have been poor.

5. A lack of spare parts – lengthy delays in provisioning and gaining repairs.

6. A lack of personal safety equipment – boots, helmets etc. A lack of warm clothing for winter operations.

7. “Lamentable” state of military buildings which have been neglected for decades.

8. Growing right-wing extremism and sexual harassment in the ranks.

9. Lack of helicopters to evacuate troops in action from dangerous situations.

As the Al Jazeera article notes:

In Germany, her stewardship of the defence ministry is widely regarded as a failure and she currently faces a parliamentary investigation on consultancy scandals

She has demonstrated “nothing that qualifies her for leading an administration of 33,000 people”.

And she is “blank” when it comes to a “vision for the future … to reform the integration project in a way that responds to its citizens’ problems and interests”.

See also the Politico article (July 2, 2019) – The inconvenient truth about Ursula von der Leyen.

The article concludes that Germany’s “weakest minister” thus “has enough qualities to be Commission president”. Tongue firmly in cheek!

Welcome to that progressive paradise – EU 2019.

Madame Lagarde needs no introduction. Austerity minded. Part of the crushing of Greece.

No past experience in central banking. Not even trained in economics.

And in December 2016, she was convicted by a French court of negligence in her role as French finance minister for negligently awarding €404 million to a businessman – a rather euphemistic description (Source).

A normal person would have gone to prison for the offense which carried a year’s imprisonment and a large fine. She was let off without penalty.

So a right-winger, untrained in the job she is getting, and convicted by a court – perfect choice for the progressive paradise.

Not to mention Charles Michel, the right-wing Belgium Prime Minister who was the youngest elected premier since 1840 and with a daddy among the European elites.

Nepotism comes to the fore. EurActiv concluded that:

Michel’s career would hardly be the same if his father hadn’t been a Belgian minister and EU Commissioner.

Which is polite!

And finally, the Spaniard nominee for Foreign Affairs head – Spain’s Josep Borrell.

He dislikes any “decentralised regional authorities amassing greater autonomy”

A great team to take Europe forward into the progressive future. Britain’s progressive aspirations will be well situated if it can just get rid of that pesky democrative vote in June 2016 to leave the EU.

While the Remain camp is mostly silent in this latest demonstration of EU ‘democracy’, there are still some supporters waxing lyrical.

The UK Guardian article (July 3, 2019) – Boris Johnson’s cash splurge is totally reckless. Yet it could win an election – from Aditya Chakrabortty was tangentially promoting the EU as some sort of progressive paradise.

While his brief was to attack Boris Johnson and is fiscal announcements designed to improve his appeal as a future Tory Prime Minister, the underlying current is to situate the progressive stance as anti-Brexit.

The old canard.

First, his attacks on Johnson’s economic plans are not well established. He insinuates that Johnson is splurging money that even Theresa May knew (in her “no magic money tree”) comments was not there.

That somehow promising “pay rises for public-sector workers”, reducing “national insurance” payments, “tax cuts for the rich”, unleashing “the biggest public-works programme seen this decade”, or providing “high-speed rail and superfast broadband” is beyond the capacity of the British government as the currency issuer.

That it is madness to announce “an emergency budget in September” to stimulate the economy by October 31 “just as the government bellyflops out of the EU”.

The article then suggests that while this all suggests that “Britain is finally entering a post-austerity era” the “the contrast will be so sharp as to be painful”.

What does that mean?

That a progressive government has to softly, softly, catchee monkey in its unwinding of austerity in case people get a shock from improved wages, or better transport and health care, or whatever?

And does it mean that major public infrastructure projects which are targetted to degraded areas (for example, in water supply etc) cannot attenuate any losses in employment that might arise from a Brexit withdrawal of capital?

Apparently, the Guardian article believes:

Whatever the Conservatives spend on Sunderland will dwindle into insignificance on the day Nissan finally follows Honda and Ford and announces it will halve the size of its plant there.

Where is the evidence for the “insignificance” conclusion?

And how much of the motor vehicle disinvestment going on in areas such as Sunderland is related to “Brexit” anyway?

And how much is due to the decline in demand for diesel cars and the emissions scandal, which reflects poor forward thinking and corrupt lawbreaking on the part of the car manufacturers?

And how much is due to the credit binge promoted by lax oversight of the financial sector which lead to a boom in car sales – dominated by so-called personal contract purchases – aka ‘on the hock’?

I am not defending Boris Johnson. Or Hunt. Spare the thought. But the progressive claims that their plans to spend more government currency to stimulate the British economy is economic madness is ridiculous.

They should be arguing about the composition of the much-needed stimulus, not about whether it will shock people who have been anaesthetised by the cruel years of austerity.

I wonder if the same article would have been written if Jeremy Corbyn had have come out with the same sort of expenditure quantum and said he was for remaining? You can guess my conclusion.

The UK Guardian’s economic correspondent Richard Partington also attacked the spending announcements in this article (July 1, 2019) – Do spending plans of Boris Johnson and Jeremy Hunt add up? .

A better demonstration of neoliberal, sound finance analysis you will struggle to find.

1. It privileges the nonsensical lies of the current Chancellor when it writes “Philip Hammond has warned the two Conservative leadership candidates their tax and spending plans would be impossible under a no-deal Brexit.”

I discussed that issue in this blog post – British Chancellor and his Shadow – arm in arm promoting fiscal myths (June 24, 2019).

2. He privileges the ridiculous concept of “fiscal headroom”.

He asks: “How much “fiscal headroom” does the UK have?”

And then claims it is the “the gap between government income and spending – of 1.2% of GDP and a level of 2% of GDP, which is worth £26.6bn.”

Where does the 2 per cent come from? It is the Office of Budget Responsibilities’ estimate of the “structural budget deficit” target, which is part of the aim to get back into surplus by 2025-26.

So, first, we have a spurious ‘structural budget’ estimate from the OBR – which relies on the statisticians trying to net out cyclical impacts on the fiscal outcome – which means it must define some potential GDP (and full employment) which is flaky at best.

Second, then we have some spurious target for that flaky ‘structural budget’ estimate of 2.2 per cent of GDP by 2020-21 – along the road to the equally spurious benchmark of a balanced fiscal state (zero deficit) by 2025-26.

Third, we then come up with some £ estimate of the difference between the flaky spurious target and the actual fiscal state as representing how much the British government has at its disposal in net terms to spend.

Neoliberalism nonsense.

Why is the Guardian holding out that sort of framework as the benchmark for assessing the fiscal promises made by the Prime Ministerial contenders?

3. He talks about a rising fiscal deficit as being a “negative” event – in part, because it would “mean higher public borrowing”.

But is silent on the fact that, under current institutional arrangements, more public borrowing means greater non-government wealth and more income to allow households to reduce their precarious debt levels.

Aditya Chakrabortty concluded after all this Guardian neoliberalism that:

The left can’t expect that pointing out Johnson’s racism or his past will sway voters – those tactics didn’t stop him grabbing City Hall. Remainers can’t carry on pointing out the madness of leaving the EU to turn this country into Singapore with jumpers – that didn’t work in 2016. We need to get much more serious and imaginative, show that staying in the EU is the best way to end austerity, and come up with policies to improve living standards here and now.

There it is – Britain must stay in the EU to end austerity – despite Johnson and Hunt announcing policies that would effectively end austerity if implemented – and in total silence to the farce that has just transpired across the Channel.

Conclusion

It is hard to actually imagine all this stuff it is so bizarre and comical.

I remain with the view that Britain should get out of the EU mess asap (which means October 31, 2019 now) and then the parties can fight it out and be mediated by the democratic choice of the people of Britain.

At least then the top jobs will go to the people that the voters, in their wisdom or madness, put into office.

That is enough for today!

(c) Copyright 2019 William Mitchell. All Rights Reserved.

Bill Mitchell
Bill Mitchell is a Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at the University of Newcastle, NSW, Australia. He is also a professional musician and plays guitar with the Melbourne Reggae-Dub band – Pressure Drop. The band was popular around the live music scene in Melbourne in the late 1970s and early 1980s. The band reformed in late 2010.

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