Wednesday, July 06, 2016

On the Implications and Consequences of the Brexit
Published: 04 July 2016
By Prof. Jose Maria Sison
Chairperson, International Coordinating Committee
International League of Peoples' Struggle

The result of the June 23 referendum in the United Kingdom, in which the majority of voters chose to take their country out of the European Union, is a rejection of austerity measures, economic stagnation, and widening social inequalities in British society.

Brexit implies a repudiation of the laws of motion of monopoly capitalism, the aggravation of these by neoliberal economic policy and the political arrogance and economic greed of the monopoly bourgeoisie, especially the finance oligarchies of both the UK and EU.

Implications of Brexit

The stunning 52-48 vote in favor of “Brexit,” as the Leave-EU option has come to be known, is mainly based on the widespread nationwide sentiment that the stagnation, unemployment and austerity measures have been generated by the EU's persistent push for neoliberal policies and its overprivileged bureaucracy. In a sense, the Brexit is a spontaneous rebellion against the EU and its main UK partners.

The strongest Brexit bulwarks have been the UK's blighted industrial areas, which are the worst-hit by the economic crisis. The neoliberal regime under EU has reduced big sections of the British working people into low-paid, precariously employed, and outright unemployed workers competing among themselves for reduced social benefits.

These comprise both the proletariat and what is more widely labeled as the precariat (unemployed and underemployed, including more and more white collars from the so-called middle class). They are increasingly unable to enjoy the supposed benefits of continued EU membership such as a wider range of cheap consumer goods, unrestricted movement within Europe, and so on.

The Brexit also reflects to a secondary degree the growing influence of rightwing nationalists, populists and xenophobes, whose mass agitation campaigns have spread hatred and anger against refugees and immigrants in the wake of the inflow of millions of refugees to the EU. Ultra-nationalist and racist sentiments have been generated by the monopoly bourgeoisie to obscure the capitalist roots of the crisis, inflame a section of the masses against others and cause senseless brutal incidents against refugees and immigrants.

But even on this point, the Brexit arguments for national sovereignty and self-determination resonated widely among the British people who feel all the more dissatisfied by the growing and overprivileged EU bureaucracy. To many pro-Brexit voters, exit from EU meant better chances to gain more control over national policy-making and improve the economy.

Such current of thinking is buttressed by the fact that the UK has all along maintained fiscal and financial sovereignty and takes into account the better living conditions of several countries like Norway, Sweden and Switzerland. The British financial oligarchy also harbors such thinking as it contraposes London as the financial center of a wider scale to Frankfurt as the financial center of the EU.

While the voting seems not to have strictly followed class alignments, the polarization once again showed the great class divide between the affluent monopoly bourgeoisie and the impoverished working people. It is this underlying clash of class interests that is expressed outwardly as voting patterns in terms of economic status, educational level, age, residence and ethnicity.

The American and British mainstream media, which reflect the interests of monopoly capitalism, especially of the financial oligarchy, have concentrated only on the pros and cons for British monopoly capitalism during the debate before June 23. Since the resounding Brexit vote, they have focused mainly on the most immediate impacts of Brexit, such as steep drops in the pound and euro, other aftershocks in the financial markets, unexpected complications for the EU labor market, and the seemingly widened floodgates of racist tensions.

What is often obscured are the root causes of the worsening economic and financial crisis. In fact, the proletariat and the rest of the people in the UK are suffering class oppression and exploitation, whether there is Brexit or not. The US has openly expressed for the UK to remain in the EU for the sake of sustaining the US-NATO expansion and pressures on Russia. But the UK has its own distinct internal dynamics despite the intimate Anglo-American links.

On one hand, the UK has always been a hesitant or reluctant member of the EU even during the latter's peak years. The pound sterling has long stood outside the eurozone, symbolic of the long-standing fiscal and financial sovereignty of the British financial oligarchy. This oligarchy has zealously done everything to keep London as a major financial center of global capitalism and pivot point of Anglo-American collaboration.

On the other hand, the factors favoring Brexit have been generated by the ever worsening crisis both of British monopoly capitalism as well as of EU-wide monopoly capitalism, under the auspices of the neoliberal economic policy propagated in Europe and worldwide by the US and UK since Reagan and Thatcher.

The British Left has not been effective in explaining in revolutionary terms to the people that the worsening economic and financial crisis is rooted in the basic laws of capitalism and aggravated at an accelerated rate by neoliberal economic policy, which has been promoted by the US and UK. Racist backlash and the myopic bourgeois media have overwhelmed the obvious fact that the massive inflow of refugees into the EU has been the result of US and NATO wars of aggression, whipped up mainly by the US and UK, in the Middle East and Africa.

The US and UK have been the most vile and violent in unleashing wars of aggression together with their NATO allies and have been mainly responsible for the phenomenon of refugees in tens of millions since the repeated wars against Iraq. They have been actively involved the longrunning war in Afghanistan and the wars in the Balkans, Africa, in Libya and Syria. They are most culpable for the 65 million refugees that have resulted from the wars.

Consequences of Brexit

What happens after the referendum is still unfolding. Various political forces, still in a state of denial, are calling for a second referendum in the hope of reversing the Brexit. The British and other European oligarchs who favor UK remaining in EU are using the post-Brexit fallout to whip up a “Bregret” trend, an anti-democratic backlash that questions the democratic vote in principle while reasserting the wisdom of the EU techno-bureaucracy, and fears that Brexit could further lead to a breakup of the UK.

British Prime Minister David Cameron has chosen to remain for 90 days to try to untangle the political mess, leaving to his successor the decision whether and when to start the formal two-year separation process under Article 50 (the “exit clause”) of the EU treaties, or even to initiate the immediate legislative repeal of some EU obligations. An alternative track entails a more complex and more extended negotiations to define future UK-EU relations. At any rate, the worsening crisis of leadership in both Tory and Labour parties are reflective of a deeper economic and political crisis in the UK.

The ILPS continues to monitor the developments related to Brexit as these directly affect the working people of the UK and Europe in general. Just the same, we call on all ILPS chapters to further study and prepare for its longer-term impacts. The Brexit is among the latest manifestations of the decomposition of British monopoly capitalism and of EU monopoly capitalism. Such process of decomposition is still made less obvious by a working class previously debilitated by social democracy, modern revisionism and neoliberalism.

Considering the major role of the UK in the European economy, its exit from the EU or redefined role can trigger the beginning of further exits by other countries from the EU. Such exits will jeopardize further the floundering Trans-Atlantic Trade and Investment Partnership and further worsen the economic and financial crisis of European and global capitalism. Germany can ride on the crisis to loosen or remove US controls resulting from German defeat in World War II and can even favor a European army independent of a US-controlled NATO.

In the still relatively more prosperous countries of Europe, such as Germany, France and the Netherlands, more nationalist and anti-immigrant parties and groups will press for exit from the EU. In countries hard pressed by higher rates of unemployment, stagnation, austerity measures and foreign debt obligations, like Greece, Portugal, Spain and Italy, the people can be led by the Left parties and movements against impositions by their local rulers, monopolies and foreign creditors.

From a proletarian revolutionary viewpoint, it can be said that the tendency of the EU to decompose will result in the eventual weakening of EU and its national components as bulwarks of counterrevolution and aggression. However, proletarian revolutionary parties have yet to effectively lead the education, organization and mass mobilization of the people on the road of revolution.

In many EU countries at the moment, rightwing parties and groups have stood out far more than the Left in responding to the crisis. There are however Left formations which can strive to assert leadership in the face of the crisis conditions that continue to worsen and incite the people to rebel. The working class, youth and people in France, Spain, Greece and Portugal have been among the most determined and militant in fighting austerity measures and other neoliberal impositions by the EU and by their respective oligarchies.

In the underdeveloped Third World, the outflow of labor migration and return flow of remittances will begin to constrict as refugees from the Middle East, Africa and South Asia and migrant workers from Eastern Europe and elsewhere compete for shrinking labor markets in EU and UK. More financial bubbles are threatening to burst, aggravating slowdowns, recessions, and unemployment in all parts of the world.

At this point in time, even the IMF and the ruling circles of many countries are aware that the neoliberal economic policy has resulted in stagnation and gross inequality and that the neoconservative policy of aggressive wars have resulted in floods of refugees. But they are paralyzed by their own arrogance and greed and still deny what they perceive.

The worsening crisis of global capitalism and the unraveling of the neoliberal economic policy drives the ILPS to call for all anti-imperialist and democratic forces to move to the front lines and bring the people's struggle forward to greater freedom, democracy, social justice, all-round development and international solidarity against the forces of exploitation, oppression and aggression.

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