Labour has to reject a Tory Brexit deal

Tory Prime Minister - negotiating exit treaty with EU

By Robin Jackson

If Theresa May manages to negotiate a draft withdrawal treaty between her government and the EU 27 one thing is already very clear – it will be a proposal that damages the economy and as a result would harm people’s living standards. Socialists will need to ensure such a deal is rejected.

Currently the Tory cabinet is arguing over what wording to accept for a ‘backstop’ agreement that will meet the EU’s requirement of no ‘hard border’ within the island of Ireland and whether to extend the transition period after December 2020. The government’s negotiations with the EU27 look likely to go down to the wire, with the date of any special EU summit, to wrap up a draft deal, still unknown.

What however has been known for some time is that the government is seeking a treaty whose terms will be harmful to the economy. It is not negotiating with the aim of maintaining in full the current free movement of goods and services between the UK and its European neighbours. Its priority that the UK leave, not only the EU but also, the Single Market and Customs Union, would lead to key economic relations being damaged, which in turn would negatively impact on people’s incomes and jobs. Any treaty based on this agenda would result in the intensification, not the reduction, of attacks on living standards and of austerity. In addition the Tories aim to rip up environmental standards, workers’ rights and consumer protections if they are allowed to pursue a deal on their terms.

Labour’s position on the other hand, set out in its six tests, is that any exit treaty must ‘deliver the “exact same benefits” as we currently have as members of the Single Market and Customs Union’. This is important because in any modern economy large scale production necessarily needs an international market both for efficient production and sales and the Single Market accounts for about half of UK exports and is vital for the imports that supply many industries. If the UK erects barriers between itself and the rest of Europe it will be the greatest loser, as it damages its export markets, its supply chains and sources of inward investment.

Since the June 2016 EU referendum economic developments in the UK have been negative. Growth has slowed down – the latest figures (2nd quarter 2018) showed that year on year gross domestic product (GDP) growth has slowed to 1.2 per cent, just over a half of its rate prior to 2016. In addition the latest ONS figures (August 2018) for sterling’s effective exchange rate indicate it has fallen by nine per cent since then too, leading to the hike in prices significantly negatively affecting people’s living standards. People are already worse off even though the main changes that would result from a Tory Brexit deal, or worse a no deal departure, have yet to begin.

The pressure Brexit will put on living standards is increasingly being understood, particularly within trade unions. Less understood is the value of free movement of people, which is integral to the Single Market. The right wing uses racism to convince people that immigration reduces living standards when the opposite is the truth. From a Marxist point of view all value is created by labour. Additional labour has the potential to create additional value. In the UK migrants actually create a disproportionate amount of value, as they are more concentrated in working age groups than the population as a whole, and so raise, not lower, the living standards of the rest of the population.

Suggestions that there can be a left wing departure from the EU that benefits the UK population reflect a misjudgement of the situation. Breaking the economic connections with the rest of the EU, in the concrete economic and political situation that exists in Britain today, cannot achieve a positive result. The attacks on living standards can only intensify accompanied by increased racist bigotry.

The Single Market and Customs Union are capitalist institutions in the hands of a capitalist class. If Britain were on the verge of full blown socialism and the choice was between pursuing socialism or being in these institutions then it would be correct to leave them – as the benefits of a full socialist economy would outweigh the loss in terms of economic development. But that is not remotely the choice currently faced in Britain. The working class is currently [very unfortunately] not in a position to replace the capitalist economy with a different type of socialist economic organisation. Socialism is not on the agenda at present. The real choice available is between being in Europe’s economic institutions with higher living standards or outside of them with job losses and lower living standards. The disadvantages of leaving these institutions are far greater than any potential advantage. In addition it matters far less whether Britain is in the decision making structures of the EU than having access to its markets.

Socialists cannot start their analysis from what they are against, such as being against Europe’s economic institutions because they are capitalist – regrettably socialists have to operate within a capitalist society at present and they are necessarily forced to choose between them. Any other view is ‘infantile leftism’ – to use the famous phrase of Lenin. Socialists have to put forward proposals that maximise the defence of living standards, not ones that will reduce living standards. That is they have to defend the interests of the working class in the most immediate as well as historical sense. Defending living standards is precisely the most crucial issue in British politics today. That is why in political terms since the Labour leadership election of 2015 the most fundamental fight has been ‘for’ or ‘against’ Jeremy Corbyn’s leadership of the Labour Party. Corbyn is a consistent opponent of austerity, which has been the crucial factor in Labour’s electoral recovery. Under him Labour has made clear it will do nothing to hurt living standards or destroy jobs. That is why Labour has said it will vote down any Tory deal which threatens either and therefore why it will need to vote down any Tory draft treaty put to Parliament. This is the framework set by Labour’s six tests and it is entirely correct.

Labour’s Conference in September this year passed (almost unanimously) a motion which included the following key commitments:

‘Conference believes we need a relationship with the EU that guarantees full participation in the Single Market. The Brexit deal being pursued by Theresa May is a threat to jobs, freedom of movement, peace in Northern Ireland and the NHS.’

‘Conference notes Labour has set six robust tests for the final Brexit deal.

Conference believes Labour MPs must vote against any Tory deal failing to meet these tests in full. ‘

‘Conference also believes a no-deal Brexit should be rejected as a viable option and calls upon Labour MPs to vigorously oppose any attempt by this Government to deliver a no-deal outcome.‘

‘Should Parliament vote down a Tory Brexit deal or the talks end in no-deal, Conference believes this would constitute a loss of confidence in the Government. In these circumstances, the best outcome for the country is an immediate General Election that can sweep the Tories from power.

If we cannot get a general election Labour must support all options remaining on the table, including campaigning for a public vote.’

If and when the Tories bring a draft treaty to Parliament for a so called ‘meaningful vote’, Labour will have to try to defeat this proposed treaty and to defeat a ‘no deal’ Brexit, as both outcomes would cause economic harm. Labour should not do anything to help prop up this flailing Tory minority government. Those on Labour’s right wing who have been offering support to the Prime Minister are allied to the Tories in their opposition to Corbyn. Their purpose is to keep him out of government. Those proposing that Labour should drop its six tests’ commitments to defend jobs and instead support a Tory deal would have the party abandon its defence of living standards, which in addition to being wrong would be politically harmful to Labour.

If a Tory draft treaty cannot be defeated in Parliament then Labour’s other options will have to be considered, including trying to get a general election to replace the government or a referendum on the proposed treaty. The latter referendum would be far more democratic than letting the Tories and DUP impose a reactionary exit treaty on the population. It would not be a ‘second’ referendum, re-running the 2016 one, but instead give people a real choice between the terms of the proposed treaty and the real current terms available as a member of the EU. Such a vote might prove to be the only way to hold this minority government to account.

Stopping the Tories’ Brexit agenda will be necessary to protect people’s jobs and living standards. The Labour right will not seriously fight the Tories because they support austerity. That is why the left has to take the lead in this struggle. When Labour fights in defence of living standards it gains support. This is why Corbyn’s efforts to defeat the Tories should be supported by all socialists.