Cameron's prescriptions for Europe miss the point (again)

The Prime Minister wants to talk about growth, but recognising the impact of German plans for collec

David Cameron wants Britain to play an integral role in reforming the European Union. He really does. His speech in Davos today explained how he is committed to reviving the continent's flagging economies with an agenda for boosting growth - deregulation; liberalisation, competitive taxation.

This is a familiar tune. Britain's position under Labour wasn't so very different - accepting a degree of political integration as the necessary price for creating an open, free trading space of continental scale and hoping, over time, to make that space look more like the UK economy and less like the French one.

The problem now, as I wrote in my column this week, is that the kind of diplomacy that is required actually to drive that agenda in the European Council - involving compromise, long-term nurturing of relationships with EU leaders; demonstrations of commitment to the European project - is also the kind of behaviour that the Conservative party generally finds unacceptable in a leader. In other words, Cameron can say this stuff, but he is no closer to getting it done if he can't build the strategic majorities among fellow EU member states to make it happen.

But there is another problem. Cameron's analysis of the EU's growth problems necessarily has to exclude discussion of the effect on demand of choreographed mass austerity - to concede that point would be to admit that the same force is in play in Britain. But clearly this is an issue. In his speech, the Prime Minister praised efforts by eurozone countries to bring their public finances under control - the drive for a fiscal compact led by German Chancellor Angela Merkel - but warned that it was not enough. He encourages the single currency bloc to consider issuing euro-bonds and effecting transfers between states - a true fiscal union, in other words. He essentially told Merkel to dip into her budget to save the euro.

If Cameron understands the inadequacy of Merkel's plans at the level of budget imbalances inside the eurozone, why does he not understand the related problem of German-enforced austerity for the continent draining aggregate demand? Why does he insist on offering only long-term supply-side solutions to the problem of European growth? The answer, I suspect, is that the government does understand the issue but it is taboo because of the coalition's political commitment to make austerity a morally inviolate part of domestic economic policy.

There was a meeting last week of the Franco-British Colloque - a top-level club of politicians, academics, business leaders etc to discuss cross-channel issues. It meets annually and this time the gathering was held in the UK. George Osborne was there and, someone who was present tells me, in the discussions of the EU's growth problem, the Chancellor effectively acknowledged the macroeconomic case against collective European austerity. He simply couldn't accept that it was relevant to the policies he is deploying in Britain. Treasury economists will surely be telling him the same thing: Merkel's fetish for fiscal conservatism is going to drag Europe down.

If Cameron wants to take a lead in promoting growth in Europe he could start by making that point. He can't of course, at least not without repudiating the central tenet of his government's economic policy.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

Getty
Show Hide image

Richmond is a victory for hope - now let's bring change across the country

The regressives are building their armies. 

Last night a regressive alliance was toppled. Despite being backed by both Ukip and the Conservative Party, Zac Goldsmith was rejected by the voters of Richmond Park.

Make no mistake, this result will rock the Conservative party – and in particularly dent their plans for a hard and painful Brexit. They may shrug off this vote in public, but their majority is thin and their management of the post-referendum process is becoming more chaotic by the day. This is a real moment, and those of us opposing their post-truth plans must seize it.

I’m really proud of the role that the Green party played in this election. Our local parties decided to show leadership by not standing this time and urging supporters to vote instead for the candidate that stood the best chance of winning for those of us that oppose Brexit. Greens’ votes could very well be "what made the difference" in this election (we received just over 3,500 votes in 2015 and Sarah Olney’s majority is 1,872) - though we’ll never know exactly where they went. Just as importantly though, I believe that the brave decision by the local Green party fundamentally changed the tone of the election.

When I went to Richmond last weekend, I met scores of people motivated to campaign for a "progressive alliance" because they recognised that something bigger than just one by election is at stake. We made a decision to demonstrate you can do politics differently, and I think we can fairly say that was vindicated. 

There are some already attacking me for helping get one more Liberal Democrat into Parliament. Let me be very clear: the Lib Dems' role in the Coalition was appalling – propping up a Conservative government hell bent on attacking our public services and overseeing a hike in child poverty. But Labour’s record of their last time in office isn't immune from criticism either – not just because of the illegal war in Iraq but also their introduction of tuition fees, privatisation of our health service and slavish worship of the City of London. They, like the Liberal Democrats, stood at the last election on an austerity manifesto. There is a reason that we remain different parties, but that doesn’t mean we shouldn't also seize opportunities like this to unite behind what we have in common. Olney is no perfect candidate but she has pledged to fight a hard Brexit, campaign against airport expansion and push for a fair voting system – surely progressives can agree that her win takes us forward rather than backwards?

Ultimately, last night was not just defeat of a regressive alliance but a victory for hope - a victory that's sorely needed on the back of of the division, loss and insecurity that seems to have marked much of the rest of this year. The truth is that getting to this point hasn’t been an easy process – and some people, including local Green party members have had criticisms which, as a democrat, I certainly take seriously. The old politics dies hard, and a new politics is not easy to forge in the short time we have. But standing still is not an option, nor is repeating the same mistakes of the past. The regressives are building their armies and we either make our alternative work or risk the left being out of power for a generation. 

With our NHS under sustained attack, our climate change laws threatened and the increasing risk of us becoming a tax haven floating on the edge of the Atlantic, the urgent need to think differently about how we win has never been greater. 

An anti-establishment wave is washing over Britain. History teaches us that can go one of two ways. For the many people who are utterly sick of politics as usual, perhaps the idea of politicians occasionally putting aside their differences for the good of the country is likely to appeal, and might help us rebuild trust among those who feel abandoned. So it's vital that we use this moment not just to talk among ourselves about how to work together but also as another spark to start doing things differently, in every community in Britain. That means listening to people, especially those who voted for Britain to leave the EU, hearing what they’re saying and working with them to affect change. Giving people real power, not just the illusion of it.

It means looking at ways to redistribute power and money in this country like never before, and knowing that a by-election in a leafy London suburb changes nothing for the vast majority of our country.

Today let us celebrate that the government's majority is smaller, and that people have voted for a candidate who used her victory speech to say that she would "stand up for an open, tolerant, united Britain".  But tomorrow let’s get started on something far bigger - because the new politics is not just about moments it's about movements, and it will only work if nobody is left behind.

 

Caroline Lucas is the MP for Brighton Pavilion.