Jeremy Corbyn’s Victory Is a Reinvigoration of Left-Wing Politics and Economics in Europe

Recently, the UK Labour Party has announced that the left-wing Jeremy Corbyn became Labour leader with 59.5% of the vote (Mason 2015). This is a candidate, who had very low odds of winning. He only came on the ballot because 15 MPs submitted his name for the Labour leadership ballot at the very last minute, seeking to expand the debate, and push the party somewhat further to the left. They never expected that Corbyn’s anti-austerity message would resonate so quickly and widely in the Labour electorate, resulting in his victory. Corbyn’s election was certainly favored by his predecessor Ed Miliband’s decision to allow not just Labour Party members, but also supporters, who paid a nominal 3 pound fee, to participate in the electoral contest. This decision encouraged many, especially younger and progressive voters, to cast their ballot in favor of Corbyn.

The reaction of the party establishment is predictably quite negative. Tony Blair (2015) has denounced Corbyn as living in Alice in Wonderland, who wants all these things that sound nice, but will never get the Labour Party elected to power. He claims that Labour lost the last elections, not because voters were critical of Ed Miliband’s right-ward austerity-lite campaign, but because he was too left. The electoral mandate was much more in favor of the “realistic” economic policies of David Cameron and the Conservatives, who have implemented enormous austerity in the name of “responsible” governing. Blair sees himself vindicated because he was Labour leader and prime minister for 10 years, so this guy must know what he is talking about.

Except he is wrong this time around. The rise of Corbyn does not reflect the rise of left-wing dreamers, who always wanted to seize opportunities for radical social change and revolution. No, the rise of Corbyn comes amid the brutal austerity policies of the Tory government, and the lack of alternative by the Labour Party. Blair’s war in Iraq and Afghanistan, proliferation of private- finance initiatives, including the health services and public infrastructure projects, favoritism toward the financial sector, decline of secure economic opportunities for the working class indicate that Blair’s Labour Party was too far to the right.

For someone like Corbyn to stand up, oppose brutal austerity policies, oppose cuts to the welfare state, favor public investments in the infrastructure, oppose the growth of inequality, protect health and school services from cuts, and oppose wars means that the people in Britain finally have an alternative to the self-defeating policies of the neoliberals.

British dissatisfaction with the status quo is not unique to the country, but is also reflected in rising voter disgust across all advanced capitalist countries, who are struggling from the same issues of low economic growth and the rise of economic insecurity among the ‘precariat’ (Standing 2011). At the beginning of this year, Greece was in the front line of the neoliberal assault on the living standards of the working class. Electing a left-wing government (Syriza) was too much “risk” for the elites of other European countries, who thought that forcing a dying patient to pay the full bill of the debt and soothing creditors is more important than establishing a more humane and rational economic strategy toward recovery and debt repayment.

The Greek Left was defeated. The most charismatic spokesperson, Alexis Tsipras, bowed down to the external economic and political pressure building up against him and his government. He declared snap elections, and his legacy is in shambles, while his party is now internally divided. The “responsible” (read: centrist, neoliberal, pro-finance) leaders in Europe breathed a sigh of relief, but they were mistaken to believe that that was the end of the line for radical left politics.

The strategic chessboard is merely shifting into other locations. In Spain, Podemos still has some voter support, though the defeat in Greece set them back in the polls. In France, Marine Le Pen’s right-wing populist party carries more and more voter support, and she advocates an expansionist welfare state (at least for citizens), and the same drift to the right (with populist left economic policy) can be observed in Austria too. A genuine left has now come to power in the UK, at least in the opposition, again reflecting the desire among the EU electorate for an end to austerity. The next target is the US, where Bernie Sanders needs to win the Democratic primaries and the general elections to become president.

The naysayers are in the media and the political establishment, but ironically these forms of public discourse are no longer the only way for ordinary people to receive their political information. The wide dissemination of internet blogs and social media websites has allowed people to receive a somewhat greater variety of viewpoints, though it is true that social media tends to restrict the posts to the political opinions that one favors (I get lots of news on Corbyn and Sanders, for example, on my newsfeed).

I do not wish to answer the question whether or not left-wing forces can reach power, because the results will obviously have to speak for themselves. The populist sentiment is certainly stronger than ever, because of the failure of austerity to result in restored investor confidence, economic growth and sustainable job creation, while the establishment voices offer no escape to their misery.

The more important question will be whether a left-wing government can lead to a restoration of economic growth, which is the only outcome permissible in a capitalist economic system in order to satisfy all factions- from investors to workers- in a society. The answer in the case of Greece is obviously ‘no’. But Greece was laboring under constraints which the bigger and more powerful countries did not face. Real test cases would be the core powers, especially  in Germany, France and the UK.

Those on the Keynesian left have long argued that if we stopped with the bloodletting austerity policies, and would promote pro-poor redistribution and public investments, we could recreate the old economic growth model, which would be correct if we establish the fact that much of the economy is currently paid as rents toward the oligarchy, while not enough income is trickling down to the masses, who want to consume and stimulate the economy, but can’t because of their low incomes.

I am, of course, more of a pessimist, and have argued repeatedly that any hope to restore high rates of economic growth in the very developed countries need to be buried, because of demand saturation and the undesirability of more growth amid resource scarcity and climate change. The political left has to offer a very different vision from the ones that we have seen so far. They have to show that low rates of economic growth can be squared with greater economic egalitarianism (a similar point made in Galbraith 2014). But to articulate such targets, we will require a greater and not a smaller public sector. One of the crucial insights in Claus Offe’s analysis of the welfare states is that state activity is trapped in a contradictory situation of simultaneously enhancing and undermining the social basis of capitalism, because the state has to operate within the confines of a capitalist economy driven by private property and private accumulation of capital (argument developed in Liu 2015).

By expanding public investments, public employment and spheres of activity of the state, the sphere of the private sector will thus become more restricted, and allow the decommodified sphere of human life expand. (By decommodification, I mean the lack of reliance on the market to survive, e.g. a worker not having to sell his labor to survive because he collects unemployment insurance, see definition in Esping-Andersen 1990: 21-22.) So far, the state has made itself a subservient force to the private-sector, and can not transcend the capital accumulation model.

Libertarian socialists believe that private actors should work on achieving socialism if that is what they desire. It would be much better than state-directed socialism, because if an arrangement is produced voluntarily and with the consent of all actors, it will lead to more legitimacy, durability and system stability. The latter point is certainly true, but it does not make libertarian socialism any more feasible, because private-sector actors face a collective action problem, which intrinsically benefits those interests that place self-interest ahead of common interest. That is why the state socialists have preferred the “commanding heights” approach, where the state takes over the most important industries, while leaving a few residual sectors like agriculture or retail to the private-sector.

Interestingly enough, Jeremy Corbyn is an advocate of the state-centric approach of regulating the economy. However, whether he will push the renationalization agenda really far is still quite questionable, because he faces significant opposition from other Labour leaders and more centric backbenchers, who have grown very accustomed to the the centrist strategy of Blair and Brown, which have gotten them quite cushy government jobs around Westminster. But if he could convince the party to embrace a platform of stopping further privatization of the health services or tuition increases in the universities (which works just like privatization because rising tuition privatizes costs and strengthens the hand of the private university administrators), he would have significantly changed the course of debate. Ironically, it is the austerity-mania of the Tory government, which make Corbyn’s positions more palatable to the more centrist middle class voters, who have thus far backed the Tories.

In the US, Bernie Sanders does not advocate nationalization, and it would currently be quite foolish to demand that to be part of his agenda. The US has a much deeper history of anti-state activity than in the UK, where Labour governments since Clement Attlee have demanded more welfare state intervention to protect the most vulnerable people from misery (and cover the electoral basis for the Labour Party). What Sanders needs to do is to effect a more limited goal of expanding the welfare state and bringing it up to the level of the European countries. Given that the aggregate US tax take is between 5-10 percentage points of GDP lower than other developed countries, and the rich are able to dodge many taxes, there is still significant room for welfare state expansion. It is a very gradual approach known to theoreticians like Eduard Bernstein (1899), who believed in evolutionary socialism- the gradual achievement of socialism with bourgeois-democratic means. But strategically, this road is the most viable one to take in the US.

The other European countries naturally have a greater understanding of socialist history, but it would be wrong to assume that they are travelling quickly in that direction at the moment. We know that the neoliberal EU elites are offering no alternative vision to austerity, and push it as a permanent policy to discipline the workforce in this more globalizing economy. Ironically, now that globalization is so important, it is more important than ever to have functioning European institutions to handle the challenges that the continent faces on a European level. But whether it is the refugee crisis, where the Europeans can’t agree on a common refugee intake policy, or whether it is the Eurozone crisis, which resulted from a flaw in the design of the Eurozone itself and shows no signs of resolution, there is less political unity than ever.

This unfortunate political dynamic implies that the national left-wing movements and parties need to first consolidate their own base via strong electoral performances in national elections afforded by an anti-austerity, pro-poor agenda, and secondly, to use their stronger voting base to coordinate more activities across borders. Currently, the problem is that most European left social-democratic parties are not really on the left, because they are helpless in front of the neoliberal assault. Yes, inequality is growing, the middle class is collapsing, the good jobs are disappearing, austerity is pushing more people into poverty, but the social-democratic leaders think these measures are “responsible” and “necessary”. The Blairs, Jospins and Schroders have had their day, and the rise of Corbyn points to real-world alternatives that challenge neoliberal dogma.

As Polanyi (1944) noted a long time ago, any move toward commodification of labor results in the counter-movement toward decommodification. Likewise, any political swing in one extreme direction triggers a political response going in the other direction. For our humanizing mission of the world and making it a better place, we can afford no other outcome.

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