The paper explores the way socialists have deployed Marxist theories in analysing European integration and Britain's participation in it. The second section looks at later debates about 'varieties of capitalism' and argues that these debates have ignored the global constitution of capitalism. The third section develops this point in relation to the possibility of challenging neoliberalism within the EU.
The paper explores the way socialists have deployed Marxist theories in analysing European integration and Britain's participation in it. The second section looks at later debates about 'varieties of capitalism' and argues that these debates have ignored the global constitution of capitalism. The third section develops this point in relation to the possibility of challenging neoliberalism within the EU.
The paper explores the way socialists have deployed Marxist theories in analysing European integration and Britain's participation in it. The second section looks at later debates about 'varieties of capitalism' and argues that these debates have ignored the global constitution of capitalism. The third section develops this point in relation to the possibility of challenging neoliberalism within the EU.
Britain and Europe: Class, state and the politics of integration z;
Britain and Europe: Class,
state and the politics of integration Hugo Radice This paper explores the way socialists have deployed Marxist theories in analysing European integration and Britains participation in it. The first section shows how theories of the relationship between nation states and global capitalism opened up new perspectives on regional integration in Europe. The second section looks at later debates about varieties of capitalism, and argues that these debates have ignored the global constitution of capitalism and exaggerated the range of variation within it. The third section develops this point in relation to the possibility of challenging neoliberalism within the EU. Introduction A t the time of the 1; referendum on British membership of the ccc, the socialist left both within and outside the Labour Party was virtually unanimous in its hostility to membership. As Gamble observed (181: 18), ccc membership was seen as incompatible with the national strategy of state-led industrial modernisation that the left then espoused, and the lefts defeat on the referendum indeed led quickly to the Wilson governments abandonment of that industrial strategy in favour of an early form of monetarism. The ignominious defeat of Labour in 1; under Capital & Class z8 Callaghan ensured that the left remained steadfastly anti- Europe through the Thatcher years, but over the last twenty years that hostility has steadily diminished, both in the trade union movement (Strange, zooza) and in the extra- parliamentary context of the social forum movement. As the European political elites prepare to celebrate the fiftieth anniversary of the Treaty of Rome, it seems appropriate to consider this evolution from a historical-materialist standpoint. The argument that follows develops in three stages. The first section looks at the way Marxist theorising on class, state and the world economy has evolved in Britain in relation to European integration, drawing largely on the Open Marxism tradition developed within the csc. The second section then examines European capitalism through the lens of the varieties of capitalism literature, arguing that the left has too readily accepted a discourse that excludes socialist transformation in favour of reformist attempts to moderate the effects of global neoliberalism. The third section looks more directly at political strategy: it begins by rejecting any attempt by the left to reconstruct nationalism as progressive, and goes on to argue that the increasing entrenchment of neoliberalism in Europe has removed any possibility of the European Union moderating the anti-working-class policies of New Labour. Marxist theory and European integration: A brief history While some capitalist states in western Europe negotiated their paths to the 18 Treaty of Rome, to the east of the iron curtain, the death of Stalin was followed by a period of political uncertainty, reform and even revolution (16 in Hungary). These changes in the east, culminating in the twentieth congress of the Communist Party of the Soviet Union (cisc), helped to generate the renaissance of western Marxism which, in the 16os, yielded a substantive renewal of the Marxist critique of political economy and the first tentative critical analyses of European integration. Official Soviet ideology had prescribed for western communists the theory of state monopoly capitalism, under which the apparently inexorable expansion in the economic role of the state was seen as the ruling classes last and doomed attempt to offset the sclerosis of monopoly and the growing Britain and Europe: Class, state and the politics of integration z economic strength of labour. The novel analyses offered by the new non-communist left included (to cite English- language work only) the work of Baran (1;), Barratt Brown (16), Baran and Sweezy (166), Mandel (168), Magdoff (16), Frank (16) and Mattick (16), who sought to renew Marxs critique of political economy by analysing contemporary capitalism and imperialism in ways that departed, to varying degrees and in various respects, from the Soviet orthodoxy. The response of orthodox state-monopoly-capitalism theory (stamocap) to European integration was to see it as a further phase in the fusion of capital and the state. The roots of national state monopoly capitalism lay in the concentration and centralisation of capital, which prevented the law of value from operating effectively through competitive market-adjustment processes. This, taken together with the growing power of organised labour to resist exploitation and to challenge capitalist power politically, had led the bourgeoisie to develop complex mechanisms of state regulation and intervention that would ensure the expanded reproduction of capital and stave off the systems crisis tendencies. However, in postwar Europe the economic processes of concentration and centralisation had outgrown the confines of the national state, most notably in the crisis of overcapacity in the regions coal, iron and steel industries. While historically such tendencies had led to fusions, annexations and wars, the new postwar world of cs hegemony and Soviet threat now led western-European capitalists to seek the peaceful negotiation of a solution to these economic problems. For communists, the participation of the European powers in Na1o indicated further that the primary political drivers of European integration, reinforcing this economic motive, were subordination to cs imperialism and hostility to the cssn. In the post-16 renewal of Marxian economic analysis, there are abundant signs of continuity with the old orthodoxy: it is as if the political break with the Soviet Union was not yet matched by an analytical break with its ruling ideology. In particular, the analysis of international economic relations remained heavily circumscribed by Lenins Imperialism and the other classic contributions by Kautsky, Hilferding, Luxemburg, Trotsky and Bukharin. This is very clear from a rereading of Mandel (16;) and Picciotto & Radice (1;1) on European integration, and Rowthorn (1;1) on imperial Capital & Class o rivalries: these are fundamentally economistic analyses, in which the state is treated as an epiphenomenonan agent of class rule whose activities are designed directly for that purpose. The break with this approach came from three sources. First, the economists took note of an emerging debate on the nature of the capitalist state, which in Britain is usually remembered as the Miliband-Poulantzas debate (e.g. Miliband, 1;; Poulantzas, 1;6, reviewed in Clarke, 11: 16zz). Second, political events around the world in 168 led to a surge of interest in Marxist theory centred on the study of Marxs work in general, but especially the early Marx, the Grundrisse and Capital. Third, significant parts of the new left in western Europe and North America sought to engage with labour movements which were themselves responding to the end of the postwar boom with rank-and-file opposition to the rule of capital, most spectacularly in France in May 168. In Britain, the 1;os saw intensive debates within the inherited framework of Marxist theory over the law of value, accumulation and economic crises, class, state and imperialism, and these debates soon generated new analyses of the causes and consequences of European integration. For the understanding of imperialism and international economic relations, the new analyses led some Marxists to a radically different ontological stance in relation to class and state. While the revival of value theory had already generated new insights into the economic role of the state in relation to crisis, Clarke (1;;) and Holloway and Picciotto (1;8) (the latter drawing on contemporary German debates) argued that the state should itself be treated as a form of capitalist social relations, rather than as being in some sense relatively autonomous, or as intervening in economic relations from outside. Historically, the state was central to the constitution of capitalism, while in contemporary practice, the struggle of workers against capital took place at one and the same time in and against both the workplace and the state (London Edinburgh Weekend Return Group, 18o). The historically- contingent character of the capitalist state also encompassed the states system: there was nothing in the social relations of capitalist production as such that entailed a multiplicity of states, the existence of which had its origins in pre-capitalist territorial politics. Capital as a social relation had no inherent territoriality, and its very boundlessness implied that it was constituted immediately as global. However, the struggle to Britain and Europe: Class, state and the politics of integration 1 establish and reproduce capitalism, and workers struggle against it, took place in the inherited multiple states through national political processes. The implication of this approach for the analysis of European political integration is clear: rather than a potential fusion of intrinsically national states, it is a contingent and partial territorial reconstitution of class rule (Holloway & Picciotto, 18o). The form and content of European integration therefore develops in a specific, concrete historical context, shaped by the course of class struggle. From this perspective, the analytical frameworks offered by bourgeois social science reflect the latters ideological limitations. Belief in the real autonomy of the political and its separation from the economic lies behind the ahistorical abstractions of neofunctionalism, liberal inter-governmentalism, Europeanisation and the various forms of institutionalism and constructivism deployed to analyse the renewed drive for integrationdeeper and widerthat set in in the mid- 18os. Instead, analysis starts from those particular elements of bourgeois politics that constitute the core roles of the state as a form of the capital relation, securing the reproduction of capitalist social relations through the public administration of laws related to proper ty and labour-power. The development of European state-like institutions takes place alongside, and not in place of or in opposition to, the development of institutions and political practices at national level. It also takes place alongside the development of wider multi-regional and global institutions: political regionalisation and globalisation appear as alternative and contingent strategies for particular national ruling classes, offering a choice of sites in which the state can seek to reproduce capitalist social relations. From this perspective, the new Europe constructed in the 1os, from the Single European Act and the exchange- rate mechanism to the euro and the zoo eastward enlargement, must be analysed in conjunction with both the global rise of neoliberalism 1 and its nationally specific forms, shaped by the circumstances of each member state. As Bonefeld et al. (1: 1) put it, we are witnessing the recomposition of labour/capital relations expressed as the restructuring of relations of conflict and collaboration between national states. Since 18o, two other approaches to the analysis of global capitalism and European integration have also Capital & Class z emerged within the Marxist tradition, and in close interaction with the approach outlined above (e.g. Bieler et al., zoo6): that of the Amsterdam School (e.g. van der Pijl, 18(, 18; Overbeek, 1o, 1) and the neo- Gramscian tendency in international political economy (e.g. Bieler & Morton, zoo1; van Apeldoorn, zooz). Very briefly, the formers key contribution was to develop the analysis of the internationalisation of capital (as in e.g. Palloix, 1;) by identifying different fractions of capital based on whether their circulation took place nationally or transnationally, leading to the advocacy of different sets of institutions and policies at national, regional and global l evel s. The domi nant fracti ons of capi tal generate comprehensive concepts of control that translate their material interests into strategies and practices of class rule embracing the global, regional and national levels. Their analysis of European integration therefore centres on the identification of a nascent European capitalist class, and its contradictory relationship with cs hegemony (see e.g. Holman & van der Pijl, 16). The more recent emergence of an explicitly neo-Gramscian approach to European integration has its origins in the work of Cox (18;) and Gill (1), who have sought to apply the key concepts in Gramscis political thought, mutatis mutandis, to the analysis of international political economy. In this approach, disciplinary neoliberalism is promoted as a framework for safeguarding and intensifying the rule of capital, taking concrete forms at global, regional and national level that are shaped by struggles between opposing social forces. The renewal of European integration in the 1os is seen as a new constitutionalism (Gill, 1) in which the regional embedding of neoliberalism overcomes national social forces of resistance through its imposition as an ineluctable external constraint. The neo-Gramscian approach had already been vigorously criticised by Burnham (11), drawing on the work of Clarke and others outlined above, for its identification of the states policies and practices with the interests of specific capital fractions rather than with capital in general. It has, however, clearly provided a fruitful approach to the empirical analysis of struggles over cc accession and enlargement and its institutional evolution (e.g. Bieler, zooz; Cafruny & Ryder, zoo; Shields, zoo; McCarthy, zoo;). The next section takes up these issues. Britain and Europe: Class, state and the politics of integration What sort of Europe? From the struggle for socialism to the defense of social capitalism The previous section offered a history of Marxisms analytical strategy for understanding European integration; this section examines its normative political engagement in terms of attitudes to particular policies and directions of institutional change. The political conjuncture of the cold war in Europe in the 16os ensured that the lefts political engagement with the early process of integration divided primarily along the traditional line between reform and revolution. Social democracy, economic interventionism and the welfare state stood on the middle ground of bourgeois politics in the European democracies, as part of what Holman and van der Pijl (16: ;) term corporate liberalism. Reformism in Britain as elsewhere took an instrumental attitude towards the Common Market, up to and beyond British entry and the 1; referendum: would membership (or in member states, specific policy initiatives) promote or impede the pursuit of cherished objectives of domestic and foreign policy? For the Labour Party, the key stated domestic objectives remained full employment, economic growth, industrial modernisation and the provision of equal opportunities through investment in education, housing and health: in these areas there was a predictable tension between those who thought that market integration would yield substantial economic benefits through economies of scale, and those who feared the erosion of Keynesian capacities of fiscal and monetary management. In foreign policy, Atlanticism, anti- communism and Commonwealth neo-colonialism had formed the three pillars of Labour thinking since 1(, and included a barely-hidden strain of hostility towards continental Europe that seemed confirmed by de Gaulles veto of Britains first application for ccc membership. However, by 1;( the erosion of cs hegemony, Brandts Ostpolitik and the growing investments of ck business in Europe had reconciled most of Labours centre and right to campaigning for membership. The left of Labour and of the 1cc (the latter dominated at this time by the ostensibly left barons of the 1cwc and acc, Jones and Scanlon) predictably opposed British membership through a mixture of commitment to the old politics of British exceptionalism, and opposition to anything advocated by the Capital & Class ( Labour right. Yet there was remarkably little real interest in the ccc among either the labour Left or the revolutionary left, whether communist, Trotskyist or libertarian: the issues of The Socialist Register for 1;1(, and likewise the short-lived Trade Union Register of the period, contain no articles on the ccc or on British membership. Apart from 168s brief spark of internationalism, which scanned rapidly from Hue to Paris to Mexico City to Prague, the left was far more preoccupied with the domestic politics of industrial and social issues. After Thatchers second election victory in 18, however, Europe assumed a far greater importance for British politics and for socialists in Britain. Thatcher cleverly exploited the sclerotic processes of policy-making in the cc to rail against a largely imaginary federalism, and then return in triumph with budgetary concessions; in the end her cultivation of Euroscepticism proved instrumental in her downfall, but every British government since her departure has played the same game. However, the crude instrumentalism of the ruling stance towards Europe led the moderate left of the Labour Party, and especially the 1cc, to look more closely at the potential of the cc as a defense against Thatcherism. Beset by electoral failure, declining membership and the steady march of anti-union legislation and privatisation, they saw Jacques Delorss cc presidency, and eventually and especially his promotion of the 18 Social Charter, as offering them a potential lifeline (Strange, zooza). By the time the Blair Brown Labour leadership took over in 1, only a few isolated elements on the left still called for British withdrawal from the cc, while the great majority both within and outside the Labour Party saw the cc as part of their normal arena of political struggle. At the same time, events in the east once again, as in the mid-1os, dramatically changed the broader global context of the British lefts political engagement with the wider world. The rapid collapse of Soviet communism in 181 and the apparent triumph of global neoliberalism was a political defeat not only for diehard communists but for all democratic varieties of socialism, which were completely unable to offer a viable alternative third way. The restoration of capitalism in eastern Europe went largely unchallenged by the left, and was shaped along neoliberal lines by new political elites supported steadf astly by the whole panoply of intergovernmental institutions from the cc, Na1o and the occb to the i:r, w1o and World Bank (Shields, zoo; Radice, zoo). Britain and Europe: Class, state and the politics of integration From the ashes of the confrontation between capitalism and communism, however, arose a pale shadow that might, by a trick of the light, be mistaken for an equally historic confrontationbetween varieties of capitalism. Popularised in Britain by Hutton (16), the comparative analysis of Anglo-Saxon/neoliberal/free-market capitalism on the one hand and Rhineland/social-market/organised capitalism on the other offered a new strategy of political engagement for the British left, explicitly limited to a progressive agenda centred on the defense of the Keynesian welfare state. The varieties-of-capitalism (hereafter voc) literature embraced a positive research strategy aimed at convincing political elites that some specific variety would generate superior results in terms of desired outcomes imputed to a given society (see Albert, 1; Berger & Dore, 16; Crouch & Streeck, 1;; Hall & Soskice, zoo1; Coates, zoo). An early example of this came in the USA in the 18os, when the superior economic and technological performance of Japan led progressive scholars to advocate the adoption of Japanese- style statebusiness relations in place of the Reagan administrations militant neoliberalism (Burkett & Hart- Landsberg, 16). In Europe, there was a parallel espousal of alternatives to Anglo-Saxon neoliberalism. Given the political climate in Britain, this focused not on the statist model attributed to France and Italy, but rather the social market capitalism (s:c) attributed variously to Germany, Austria, Holland and the Scandinavian countries. The effectiveness of this advocacy depended, however, on two necessary conditions: first, the superior performance of s:c, and second, the persistence of salient differences between the two models. In the early-to- middle 1os, these conditions appeared to be fulfilled. cs and ck economic performance appeared decidedly weaker under George Bush senior and John Major respectively, while the German slowdown could plausibly be attributed to the burden of post-1o unification, and the other s:c exemplars appeared to be doing well. By the end of the decade, however, these circumstances were reversed: the csa was dramatically outstripping Japan (and the east Asian miracle was over), while the Blair government was trumpeting its success over European s:c in reducing unemployment and restoring sound finance (Radice, 1). The second condition for the effective advocacy of s:c concerned the question of convergence. The mainstream voc Capital & Class 6 literature was precisely structured around perceived divergences between countries in the institutions and practices of capitalism. Differences in national economic performance had conventionally been attributed by economists to comparative advantages in trade, based on resource endowments, capital accumulation and productivity growth. voc writers proposed a further factor, drawing on the new institutionalisms in the social sciences: the effectiveness of institutions in managing a countrys economic responses to the challenge of international competition (Hollingsworth, 1(). The new institutional economics proposed that institutions were themselves subject to a process of market selection, ensuring the survival of the fittest model; sociological institutionalism argued that the process of elimination of unfit models might be slow or incomplete because the embeddedness of institutions led to path dependency and thus inertia in the face of pressures for change; and certain forms of political institutionalism would add that culturally-rooted political and policy preferences could further slow or prevent change (Peters, 1; Radice, zoo(). Thus convergence might be slow, and alternative models could coexist and compete over significant periods of time, with international comparative success perhaps changing hands in response to exogenous factors; and in any case, at some level of observational or analytical detail, institutional differences are bound to persist. Within the terms of the voc literature, it is simply not possible to establish either the existence or otherwise of convergence, or the definitive superiority of one or another model. This, then, provides the intellectual justification for continuing to advocate forms of s:c in opposition to the global tide of neoliberalism; whether this advocacy occurs at national or cc level depends pragmatically on political and economic circumstances. However, what is clear is that the voc literature is powerfully locked into methodological nationalism (as defined by Gore, 16: 8o8), and this has led to tensions and contradictions in relation to the question of globalisation. It was argued in the previous section that while states as forms of the capital relation are national, capital itself, and thus the mode of production in general, is constituted globally. This explains why the political and economic circumstances just referred to are experienced as exogenous to the politics of institutional and policy positions contested at national or cc Britain and Europe: Class, state and the politics of integration ; level. But the neoliberal reconstitution of global capitalism is unquestionably not exogenous: it is the outcome of a complex, multilayered and often barely visible process of class struggle. Within the European Union, at any point in time and in any given country, the modalities of response to these apparently external forces will be contingent on the disposition of social forces in that country, but both state and market remain as social forms of a global capital relation. z In this context, the alternative institutions and practices debated in the voc literature, including its progressive wing, undoubtedly do represent arenas of class struggle. However, it is only an exploration of how these institutions and practices have evolved within the global relation of capital that can reveal the potential and the limits of the fight for a preferred model of capitalism. What is all too rarely appreciated is the extent to which elements of that preferred model have historically either emerged as or been transformed into purposive strategies for the containment of challenges from the working classes and the elimination of any emancipatory content. This is especially clear in relation to that most fundamental of capitalist processes: the exploitation of labour power. The class politics of Britain and the EU In workplace relations between labour and capital, the choice between the simple carrot-and-stick modalities of exploitation visible in the neoliberal model and the participation-and- consensus modalities attributed to the s:c model was understood long ago by Friedman (1;;) as a choice of managerial strategy within the capitalist firm. Attempts were made in the 1;os to turn the managerial strategy of job enlargement into a springboard for new forms of collective challenge to the rule of capital through the advocacy of workers participation, cooperatives and the conversion of production to meet social needs (e.g. Cooley, 18;; Wainwright & Elliott, 18z). At the level of state policy, all such proposals had been successfully eliminated from discussion twenty years later. A parallel story can be told about the institutions and practices surrounding the labour market, including skills and training. The highly-regulated German model was widely lauded in the progressive voc literature for generating a virtuous circle of high wages and high productivity, which would at least improve the life Capital & Class 8 circumstances of a significant part of the working class. Such regulation has persisted in the teeth of ideological disapproval from the Anglo-Saxon world because social protection aids the market by helping economic actors overcome market failures in skill formation (Estevez-Abe et al., zoo1: 1(), indicating that this is an effective strategy for some employers in the face of global competition, rather than necessarily a prefigurative strategy for the working class. The adoption of a minimum wage by New Labour, while welcome in itself, has been overshadowed by the governments refusal to act against illegal employment practices, especially in relation to migrant labour. Third, consider the condition of trade unionism in Britain and in Europe (see also Taylor & Mathers, zooz). The Blair governments, while not challenging the constitutional role of the unions in the Labour Party, have resolutely refused to restore any semblance of the policy partnership that existed at least on paper between the Labour Party and the unions prior to 1;. The recent industrial-relations literature charts the relentless advance of the business unionism model and the decline of effective collective bargaining in favour of workplace and partnership agreements; and the election of left-wing leaderships in a number of unions since 1;, while heartening, has not stemmed the tide (McIlroy, zooo). Parallel tales could be told, if space permitted, about many other policy areas in which the voc literature sets out the endurance and superiority of the s:c model (Radice, 18). None of this means that socialists should proclaim indifference to the potential for change within capitalismon the contrary. What should be expected is a degree of realism, and above all an understanding of the overarching framework of capitalist relations within which policy institutions and practices are set. Nevertheless, the approach taken so far will be interpreted by many as pessimistic and defeatist, as Strange (zoozb) argues in relation to previous contributions on globalisation by the present author. Such an interpretation depends on perceiving substantive opportunities for contestation within the framework of European governance: Taken together, Euro-Keynesianism and radical Euro- corporatism can be seen as providing a socially inclusive governance framework for a sustainable alternative compromise between European labour and European Britain and Europe: Class, state and the politics of integration capital based on negotiated involvement. In neo-Gramscian terms, such a framework can be seen as having the potential to mobilise an alternative transnational, European historic bloc in favour of a new regional social democracy appropriate to the structural constraints of globalisation. (Strange, zoozb: z) an alternative that is transforming of the system rather than merely transcending of it (ibid: 6o). This section seeks to refute that argument, suggesting instead that the renewal of socialism in Britain and in Europe as a whole requires a resolutely and consistently global political strategy guided by the objective of transcending it. Taking up the argument of the previous section, the potential for social-democratic or progressive change in capitalism at the European level is heavily constrained not by the structures of globalisation (important though they are), but by the historical experience of British nationalism. Over the past zo years, almost every political nation has experienced nationalism at some time or other as a socially- progressive political ideology. However, it takes only a moments reflection to appreciate both how paper-thin this progressive character is in most cases, and how utterly regressive nationalism has been at other times. The modern British left has relentlessly castigated itself for its inability to wrench Britishness from the extreme right: it has looked back to the Dunkirk spirit that resonated from 1(o through the postwar Labour governments, and further back to the rise of organised labour from the creation of the 1cc until the defeat of the 1z6 general strike, to Chartism, cooperatives and the Luddite resistance to the industrial revolution, and to Thomas Paine. Those Eurosceptic social democrats and socialists who have opposed European integration have, however, found their appeals to these radical British roots swamped by much uglier social forces on the political right, epitomised by the Murdoch and Rothermere presses. The same inability to effectively articulate a progressive nationalist alternative can be identified throughout the cc in recent years, whether in relation to opposition to accession, to enlargement, or to the new constitution sidelined by the French and Dutch referendum defeats. Even in the mobilisations of ethnic-minority communities within European nation states, traditionally taken to be almost naturally progressive by the left, perceived historical injustices Capital & Class (o or religious differences have provided the strongest justification for revolt, rather than any predisposition against capitalism or even social inequality. But in the British case, to argue on the basis of the last fifty years that British society is in any sense more socialist, more democratic or indeed more egalitarian than Europe is frankly ludicrous. Over little Britain rejection of European integration, then, there can surely be no disagreement: the revival of any sort of socialist or even progressive politics in Britain has to embrace a European dimensionand that means not clarion calls for a united socialist states of Europe, but politically living in actually existing Europe, recognising and celebrating our multiple identities as citizens of Europe and the world and as, historically, a blessedly mongrel nation. From that starting point, the more interesting question is posed: how is European socialism to be nurtured? Traditionally, this issue has been presented rather mechanically in terms of a strong European movement can only be built on the basis of strong national movements. Restricting the argument to the labour movement, this is not however simply a matter of choice, whether for union leaders or rank-and-file members. We live in a world in which the legislative and policy frameworks governing our spheres of political action remain very predominantly national, while the social forces shaping the challenges we face are increasingly transnational. What implications can we draw for the politics of labour from this apparent contradiction between the national and the global? For the neo-Gramscians, economic globalisation (of production, trade and finance) means that an increasing number of sectors of the economy are transnationally integrated, and in these sectors both capital and labour will seek to influence government policies in a neoliberal directionincluding that of cc accessionwhile this is resisted by both capital and labour in those sectors that remain predominantly national in orientation (Bieler, zooz). However, such a view implies that the dynamics of capitalism are merely those of competition in the marketplace. The neo- Gramscians appear to assume that sectors are independent of each other in terms of value chains; but most national business sectors are characterised by relatively small firms which are characteristically highly dependent on large, typically transnational enterprises, as Shutt & Whittington (18;) have explained. The crucial point is that, while the Britain and Europe: Class, state and the politics of integration (1 circumstances faced by workers in any given workplace are contingent on product- and labour-market factors, the overall conditions of exploitation are necessarily determined through the operation of the law of value at the level of capital in general, which is enforced by the capacity of individual capitalists to withdraw their money capital from one locus of production, and reinvest it elsewhere (or hoard it). The existence of significant differences in wages and working conditions, both between sectors and between individual workplaces, merely indicates that the law of value is mediated by the contingent circumstances of individual parts of total social capital (see Botwinnick, 1). So extensive are the transnational interrelations of investment, production and trade now for all European countries, but pre-eminently for Britain (Radice, 18(), that it no longer makes any sense to distinguish national and transnational fractions of capital in terms of alternative world-market strategies of free trade or protectionism. Instead, what is required is the charting of the historical development of the patterns of engagement between capital, labour and the state in each particular national context, on the understanding that these patterns necessarily co-evolve with those of global capitalism. In the British case, as Gifford (zoo;) has recently restated, the national forms of class struggle have over several centuries been unusually transnational in content, embodied in the predominance of mercantile and financial interests in the determination of government policies and the shaping of the institutions of governanceperiodically imposed as an external constraint (Callaghan, zooz) on social democracy. There was a brief moment in the second quarter of the twentieth century in which the intrinsically global character of British capitalism appeared to be seriously under threat; but the postwar Labour government, whatever its achievements in relation to the welfare state, rejected any real break with the past as vigorously as had the National government of 11. Neither the Labour Party nor the trade unions challenged the Atlanticimperial international economic policies of the 116( Conservative governments. The left attempted to articulate a strategy of national industrial modernisation for thirty years from the mid-16os, culminating in the alternative economic strategy (e.g. London csc group, 18o; Cowling & Sugden, 1o), but in 1;(6, at the only moment in which this could have been brought into effect, it was decisively rejected by Labour Capital & Class (z in government in favour of a monetarist retrenchment that echoed that of Snowden in 11. The turn to Europe by British unions in the 1os was entirely understandable at the time: it amounted to an attempt to expose the British business and political elites to a very different kind of external constraint, namely the imposition of social-market capitalism from Brussels. But the course of events since New Labour came to power has amply demonstrated that the BlairBrown strategy of engagement with Europe has consistently promoted the neoliberal agenda of reform, aimed especially at imposing labour-market flexibility and the mobility of capital, in historical continuity with the pattern of British engagement with global capitalism. The new social-democratic dawn of the late-1os was swept aside by Lisbon (Gifford, zoo;: (;z), and by the accession of new member states in eastern Europe whose politics appeared to offer only a choice between neoliberalism and national revanchism. What is now required is a far more arduous long march into and across the European Union, constructing a popular movement against neoliberalism based on common concerns about equality, citizenship, human rights and the environment, and engaging unions and social movements as well as the groundswell of broader opposition since zoo to European complicity in the renewed imperial adventures of the cs regime. Notes 1. It is increasingly clear that the term neoliberalism has been overused and underinvestigated almost as much as has globalisation. A succinct and helpful account can be found in Gamble (zoo1); see also Saad-Filho and Johnston (zoo) and Harvey (zoo). z. Callaghan (zooz) gives a historical analysis of the role of external constraints in explaining the limits of social democracy in Britain and Europe. References Albert, M. (1) Capitalism Against Capitalism (Whurr). van Apeldoorn, B. 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Vladimir Lenin on Democracy and Dictatorship. Illustrated: The State and Revolution, Two Tactics of Social-Democracy in the Democratic Revolution, All Power to the Soviets!, "Democracy" and Dictatorship