The Denouement

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A Socialist Project e-bulletin .... No. 1143 .... July 15, 2015
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The Denouement

Leo Panitch

For many decades, the view was widespread on the left that there was a distinct European variety of capitalism which could be positively contrasted with the Anglo-American more ‘free market’ variety. The labour movements of northern Europe were usually seen as being the decisive force behind greater state economic involvement, more capitalist cooperation with unions, and more egalitarian social welfare and labour market regimes. The development of the European Union added a further attractive dimension to this, especially for internationalists. It was considered retrograde to want to stay out, let alone get out, of the European ‘project’ at each phase of its development, with many seeing participation in its institutions as the decisive terrain for the left's engagement.

The hyper-austerity... policies European states have pursued since 2009, contributing to the powerfully lingering effects of the first great global capitalist crisis of the 21st century, already shattered a good deal of the left's illusions about Europe. The denouement of the Syriza strategy in Greece appears to have written finis to it.

The writing was on the wall already as the European left searched for an exit from the global capitalist crisis of the 1970s. This was especially the case when the Programme Commun forged by the French Socialist and Communist Parties ran up against the implicit neoliberalism embedded in the Treaty of Rome's ambitions for free trade and free capital flows across Europe. With the massive capital flight that pursuing Keynesian measures led to in the face of German and American monetarism, it was the German Social Democratic leader Helmut Schmidt who forced François Mitterrand's famous U-turn by telling him capital controls were impossible unless he abandoned the European project. The roots of the arbitrary 3 per cent ceiling on fiscal deficits in today's European Stability Pact go back to the ceiling first imposed on the Mitterand government in the early 1980s.

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