It is for this reason that May’s only threat to try to maintain Britain’s economic growth is to make it what is called by the media and the Tories a ‘tax haven’. But this conceals the reality, a ‘tax haven’, a country without an adequate tax base, is one in which social protection and social services would be slashed. The economic path May proposes outside the European Single Market is actually one of a low wage, low job security country with massively reduced social protection.
These economic forces are so powerful they would overwhelm in their effect of living standards measures which are desirable in themselves proposed by Labour such as a National Investment Bank, and rational industrial policy etc. There must therefore be no illusion – if Britain leaves the European Single market, living standards will fall and substantial job losses will occur. Labour, therefore, cannot really defending working class living standards without maintaining membership of the Single Market.
It is because of this economic reality that there are significant divisions even within the Tory Party on the Single Market. For the time being Theresa May can unite her party by making the reduction of immigration the priority. But not merely is such a course to be rejected because it is racist but because it cannot solve the negative economic effects on living standards and jobs of leaving the Single Market.
These objective economic realities mean that Labour needs to unite around membership of the EU Single Market.
Labour has tabled seven amendments to the parliamentary Bill authorising Article 50 to be triggered (and is supporting two others on workers’ rights). They should all be supported and the first two are particularly important. They give parliament a vote on the terms of the Brexit deal that the Tory government agrees with the EU. Secondly, they “establish a number of key principles the Government must seek to negotiate during the process, including protecting workers’ rights, securing full tariff and impediment free access to the Single Market.” This corresponds to the actual requirements of the British economy and would protect jobs and living standards. Labour’s priorities are the correct ones.
But the political process has been mishandled and the major effect could be to undermine Jeremy Corbyn’s leadership of the Labour Party. Corbyn’s leadership is decisive in maintaining the Labour Party’s opposition to war, austerity and racism, and its policies in favour of peace, investment and equality.
The imposition of a three-line whip on the Article Bill is a blunder. It is widely understood that Labour MPs have strongly-held views on opposite sides of the Brexit debate. The imposition of any three-line whip was always going to cause divisions, splits and resignations. It stands in contrast to the free votes on Trident and on bombing Syria, which was in the most literal sense a matter of life and death. It also does not correspond to the views of Labour’s members, as 90 per cent of them voted to Remain or to the views of Labour voters, as 63 per cent also voted Remain.
It is the imposition of a minority position that has provoked the splits. Corbyn’s enemies within Labour have now been handed a cause celebre to rally around. This was totally unnecessary and self-inflicted. Because of Labour splits and the Tories’ temporary unity, Labour’s vote was never going to be decisive on this issue. Article 50 will pass whatever Labour does.
Instead, Labour should fight for its amendments, attempting to get the other opposition parties to support them and trying to draw in pro-EU Tories. For Labour, the paramount issue must be jobs and living standards.
It is becoming increasingly public that leaving the Single Market will be deeply damaging. A large number of international businesses announced they would be seeking to relocate jobs after Theresa May’s clearly ‘Hard Brexit’ speech as she confirmed she would be looking to leave the Single Market. The chair of Toyota said the car-maker would have to ‘examine how it would survive’, if the UK leaves the Single Market. Many other businesses will be doing the same.
Derby and Deeside, the locations for the big Toyota plants both voted to Leave, as did Sunderland. But they did not vote for unemployment. Labour can unite and build a majority by opposing the devastation caused by leaving the Single Market. The same point applies in numerous sectors and locales.
The fantasies swirling around the referendum campaign are being blown away. The vote is already lowering living standards and cutting investment. The sole realistic prospect for the economy outside the Single Market is not a free trade land of plenty, but a trade deal with Trump. This would destroy the NHS, abolish environmental protections, devastate farming and remove food safety standards. Most sectors of the economy would face severe disruption. The sole major sector where the UK is arguably more competitive than the US is finance.
This is not a perspective Labour can accept or embrace. It has to fight for the interests of the majority, which for the foreseeable future must mean remaining in the Single Market.
There will be two parliamentary by-elections on Thursday 23rd February. To assist Labour's campaigns activists are encouraged to participate in the events in Copeland here and Stoke here. Also Momentum are organising carpools for activists (see the Facebook groups: Carpool to Copeland and Carpool to Stoke).