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The elephant and the lone star

The message from Barack Obama’s victory in the 2012 election was that Latino America holds the balance of power. But in Texas, it seems — despite Bush’s best efforts — that hasn’t yet sunk in to Republican minds.

Eddi Regolado still cries when he hears the national anthem: not that of his native Nicaragua, from which he fled with his family during the long civil war when he was seven, but of his new and adoptive home, the United States of America. He and his family settled in Texas in the state capital, Austin, but the citizenship process was arduous. It took Regolado nearly 20 years to naturalise but he doesn’t mind. “Every single member of my family loves the US,” he says. “We’re proud to be here.”

He works two and a half blocks north of the state capitol building in Austin – practically in the shadow of its hulking red dome – as the general manager at El Mercado, an airy and pleasant Mexican eatery. Over chalupas (a sort of stuffed taco shell salad) and margaritas, he tells me he still feels nostalgic about Nicaragua. “Going back is like going to my mother’s house. America is like, our wife. But it’s good to see Mother from time to time.”

Regolado is a Democrat. His parents are Democrats. Pretty much his whole family votes Democrat. He says Latinos lean that way because the Democrats “tend to help out more with immigration. When you’re new, from a different country – how do I put this? – a lot of families have a hard time assimilating. The Democrats help out with that. It’s not loyalty, exactly, but that’s why they tend to vote the way they do.”

He feels the Democrats are just making more of an effort to reach his community. “All the minorities, really.”

He thinks that as the Latino population of Texas increases in size, there will be a process of realisation of power for his community, a realisation that engagement with the political system can help Latinos get their voices heard. If they wake up in this way – and if the Republicans continue to alienate Regolado and his family in the way they are doing – at some point soon the Democrats could take Texas. Here’s how important this is: in a presidential election, Texas has 38 electoral college votes, the second most of any state, behind only California. If the Democrats turn Texas, that’s it for the Republicans. Game over. Lights out. Unless the Republican Party reforms beyond all recognition, there might never be a Republican president ever again.

***

Texas was annexed from Mexico by colonists from the US in the 1830s, birthing the short-lived independent Republic of Texas after a short but bloody conflict, the most famous battle of which was the Alamo in 1836. It was pretty much the last battle Texas lost, a massacre of 187 troops holed up inside a mission in San Antonio, routed by General López de Santa Anna’s army of more than 5,000. Outside the capitol building, two blocks from El Mercado, is a statue commemorating the heroes of that battle. The fight begat a rallying call that Texan patriots remember to this day: “Remember the Alamo!”

In some parts of the population, especially among the older white males and especially in more rural areas, there is a kind of inherited memory that still attaches great importance to the Battle of the Alamo. They see Texas as a white bastion, and their sense of the loss of the 1836 republic, a sense that in some intangible way they are being overrun, is a powerful political force. It most often emerges in the form of an obsession with policing the borders and finding and deporting illegal immigrants.

During last year’s presidential election, to avoid being outflanked on the right by competitors such as Herman Cain and Rick Santorum, Mitt Romney engaged in antiimmigrant rhetoric, making much-criticised proposals about “self-deportation”. Unsurprisingly, Romney’s support among Hispanics on election day was catastrophically low, 44 points behind Barack Obama – yet he was seen as a moderate candidate by current Republican standards.

“I’m not in the crystal ball business,” says Bill White, a former mayor of Houston and Democratic gubernatorial candidate who ran against Rick Perry for governor of Texas in 2010 and who, despite losing overall, received a greater share of the vote than any Democrat in the state’s history. “But if the Republican Party continues on its present course, then they will become a minority party in Texas.”

Latinos today make up 38 per cent of the electorate in Texas, a proportion that is growing swiftly, but they are under-represented in the Republican Party; out of a GOP delegation of 95 in the Texas House of Representatives, only three are Hispanic, while Latinos form an absolute majority of the Democratic delegation: 29 out of 55. This is a good sign for the Democrats. Latino voters represent a segment of the population that is increasing sharply both in size and in political engagement, and the Republican Party seems hellbent on alienating them.

Professor Mark Jones, who chairs the political science department at Rice University in Houston, warns that the Democrats can’t just wait for the demographic shift to come to them. “If the Democrats sit back and do nothing, they’re depending on the Republicans continuing to commit the same errors they’ve been making up until now,” he says. “The worst-case Democrat scenario is, they do nothing, and the Republicans bite the bullet and kick the immigration issue. If that happens, then the Republicans can cling on to dominant status here for 20 to 30 years.”

But, Jones says, if the Republicans don’t rid themselves of their anti-immigrant rhetoric, even if Democrats continue to sit back and do nothing, the state could shift sooner than that: perhaps within 15 years. “The third scenario, the best-case scenario for Democrats, is that Republicans continue the same way – adopting a very hard line on immigration; allowing that to dominate the image of the party – while Democrats get their act together and do a good job of mobilising and registering Hispanics. Then we could see a shift even sooner: in, say, eight years.” That means Texas would flip to the Democrats more or less “by the end of the decade”.

***

In the 2010 census, Texas had grown sufficiently to merit the addition of four seats in Congress – the number of federal senators is fixed at two per state regardless of size but the House of Representatives uses a metric based on population. That growth was almost exclusively in the Hispanic population.

However, it is important to note the differences within that community. National political strategists have usually lumped all Hispanic interests together, but this is wrong. Even at a casual glance, the Mexican-American population is very different from the Cuban Americans, who lean more conservative. Most of the Republican Party’s highprofile Hispanic candidates: Marco Rubio in Florida, Ted Cruz in Texas – candidates on whom the party pins its hopes for winning over the entire Latino community – are Cuban-American and will struggle to win over the Hispanic voting bloc en masse. To win the primary for his Senate race, Cruz ran to the right on many issues that the Latino community finds troubling, promising to build a wall at the border, for instance, and to triple the size of the border patrol. This has not found him favour with many Latino voters. Eddi Regolado, for one, says that he thinks they would be much more likely to support a white Democratic presidential candidate such as Hillary Clinton than someone like Cruz or Rubio.

“It’s interesting in Texas that the reputation of the state is [that] it’s overwhelmingly Republican,” says Joe Holley, the political editor of the Houston Chronicle. “And yet every one of its big cities are Democratic.” To some extent, Texas has always been a oneparty state, and it was actually a Democratic stronghold from the Reconstruction era – the 1860s and 1870s – right up until the 1980s, as Holley explains. It gradually began to change in the 1950s, 1960s and 1970s, and by the 1990s Texas was still a one-party state, but that was now the Republican Party.

Now, once again, the demographic change is slowly loading weight back on the other side of the see-saw.

“This is sort of, in kind of a quirky way, the second Texas Revolution,” says Holley, smiling. “And this time, the Mexicans are going to win.”

***

Jon Greene teaches English as a foreign language in downtown Houston, and he invites me to sit in with him on the course. It’s a chilly Thursday night, the last lesson of the term. There are ten people here, some young and some old, all Hispanic. Immigration is a sensitive subject in Texas, so the status of the students – illegal or legal – is off the table, as are names. I will lend some of the classmates a nom de guerre for the purposes of this article. The class is split about half and half between those of Mexican and El Salvadorean origins. Most say they came to America looking for work, or as children with their parents doing the same. A few of the El Salvadoreans say they came fleeing violence; a civil war raged in El Salvador from 1979 to 1992.

Many are educated professionals in their country of origin but struggle to find work in the US – one, Sofia, a lawyer back in Mexico, has been working as a babysitter. Many of the students are here because speaking English helps in the search for work, but many are also here to help them communicate with younger, more integrated members of their families. Cristina, who came to the US in 1980, is one of the latter: her daughter is an opera singer and her son is a trainee journalist, and for both of them their first language is English.

I ask a few questions about politics. Greene, their teacher, had warned me that the English of some of the students was pretty basic, but we make impressive progress as the class warms to the subject.

After introductions, we go around the room namechecking highprofile Hispanic politicians. Many of them talk about Adrian Garcia, the popular sheriff of Harris County in metropolitan Houston. Rick Perry, the Republican governor, gets short shrift, but the Castro brothers – Joaquin and Julián, the former the new congressman for the 20th district of Texas and the latter the mayor of San Antonio, whose keynote speech at last year’s Democratic National Convention gave him a public profile across the country – are warmly approved. Maria cites the appointment to the Supreme Court of Sonia Sotomayor, a Puerto Rican, as another sign of a Hispanic political awakening.

“This is the first time a black person stands for president,” says Juana, from Mexico. “Maybe next time, a Hispanic?”

“Maybe a woman, too?” Cristina shoots back. Grins of female solidarity dart across the room. Some of the men – somewhat unwisely – giggle. Sofia the lawyer snaps at them in Spanish, and the debate descends into a lively row.

I ask if any of them is a particular fan of the Republican Party. That makes everyone go quiet. There is a long silence, broken by a cough. Cristina shakes her head slowly. How about Romney? “He don’t like the Hispanic people,” says Rafael, one of the younger El Salvadoreans. There are murmurs of agreement. “I vote for Democrats. I’m a Democrat,” Cristina says. The other classmates nod their assent.

***

The following day, as the storm cloud that has been hanging over Houston for days finally breaks into torrential rain, I drive out to an adjunct tower block near the Rice University campus to meet Steve Murdock, the director of the Hobby Centre for the Study of Texas, a professor of sociology, a former official state demographer for Texas and, before that, the director of the US Census Bureau.

Murdock, as his background would imply, is a man who loves his data. My interview with him involved the prolonged viewing of no fewer than 120 charts and visualisations showing projections of the Hispanic populations of Texas and the US. As he says to me with a grin when I sit down: “You have to watch out for a demographer – they always want to show you data.”

The numbers are staggering. In the age group 65 and over, there are many more Anglos – a Southern slang term for non-Hispanic whites – than Hispanics: 67.6 per cent to 20.5. But as age descends, the ratios switch over. In the 35-to-39 age group they are about equal and by the time you get to the under-fives there are considerably more Hispanics than Anglos – 50.6 per cent to 31.7 per cent. In total, Hispanics account for 48.3 per cent of the under-18s in the state and that figure is rising. By the time the current cohort of children is of voting age, Hispanics will be the majority in Texas.

“You really have, in the US, two populations,” says Murdock, as lightning streaks the sky outside: “an ageing set of non-Hispanic whites, whose fertility has been below replacement for over 20 years, and a young and growing minority population.”

Texas and other states that have had high levels of Hispanic immigration, such as California, are some decades ahead of the curve, yet the census data shows a similar trend in the US as a whole. “[What we’re seeing is] one of the largest changes to occur in US history in terms of broad changes in ethnic composition,” Murdock says.

He shows me another graph, this time of projections of the US population out towards 2050. It shows a dramatic shift. The non-Hispanic white population rises just seven million, from 196 million to 203 million. The Hispanic population, however, nearly quadruples, from 36 million to 133 million. The difference in percentage change is enormous. In Texas, the projection is even starker. Assuming zero net migration, the population of Texas will be majority Hispanic – just – by 2030. Assuming the same net migration as in the years 2000-2010, that will happen before the end of the decade, and the projection is that by 2050 Texas will have nearly three times as many Hispanics as Anglos – although, because that figure includes the under-18s, the switch-over from minority to majority in terms of the electorate will happen a little while later. Murdock is the first to note that long-term projections can be shaky – there is a wide margin of error at play – but according to even his most conservative estimates, the change is inevit able. “Demographically,” he says, “we’re not looking with much question at what the future is going to be.”

***

Demographics are different from politics. While the former may be changing swiftly and unstoppably, working out how this will affect the latter is a more complex endeavour. By no means should we take it for granted that a rising Hispanic population will lead to a corresponding rise in the Democrat vote – and the Democrats have been blasé in their approach to Texas.

I ask Mark Jones at Rice if that attitude on the left is matched by a disbelief on the Republican side that they could ever lose Texas. “I think the Republican pragmatists get it,” he says. “Even privately, some of the right wing gets it; they just don’t want to say it publicly. But the problem they run into is convincing those people who vote in primaries, some of the real activists, who either don’t believe it – they just don’t see a linkage between their rhetoric and the Hispanic vote – or who believe Latinos are all hooked on welfare and they’re never going to win them over.”

Maria Baños Jordan is the executive director of the Texas Latino Leadership Roundtable, a group that aims to foster and encourage leadership and political engagement in the Latino community. She is of mixed Hispanic origin. Her father was a Cuban refugee who came to the US in the early 1960s after the rise of Fidel Castro; her mother was a Mexican immigrant. They met in Houston.

“I grew up in the change, in the time where Houston started to really just explode, and the population started to become more diverse. When I was a little girl, I was the only Latina in my class. So I know what that felt like, and I know what it felt like to be questioned about your culture, and your behaviours and your tradition.”

Today, by contrast, the public school system in Texas is overwhelmingly Hispanicmajority, a reflection of the changing demographics. In Houston, non-Hispanic whites account for just 7.8 per cent of enrolled students. Hispanic students account for 61.9 per cent. Jordan’s organisation, in parallel, has taken off in a big way in recent years. “The feel in Texas right now,” she says, “is that the state is ripe for more Latino leadership.”

I wonder why an established, resident and maybe second- or third- or even fourth-generation immigrant population still gets angry about legislation affecting new or illegal immigrants. “The immigration issue is such an emotional one,” Jordan says, “especially when there are so many families that are intermarried, whether documented or undocumented, or first-generation or second-generation.

“It’s not black-and-white. We all have close friends or relatives that have issues with immigration. We’re dealing with it on a daily basis, so we are very tied to it. And we know that the law’s the law, but we need to see respect and dignity brought into the conversation. And it just hasn’t gotten to that point yet.”

“To be honest,” says Eddi Regolado, “illegal immigration will never stop. People would rather take their chances than stay. A fence is not going to keep people out. This country was founded by immigrants. There has to be a way to help people.”

Hispanic-American support for the Democrats is not fixed; historically, it has fluctuated from election to election. Latinos came out in force in 2012 for Obama – 71 per cent of them voted Democrat, according to the Pew Research Centre, a level of support surpassed only in Bill Clinton’s 1996 race against Bob Dole, in which 72 per cent voted Democrat. But the Bushes, George and George W, clawed back a large part of the percentage point gap among Hispanics, so much so that where Obama was 44 points clear of Romney, George W Bush’s support in 2004 was just 18 points shy of John Kerry’s – still a big gap, but a much healthier margin.

Leonard Rodriguez, a San Antonio native, was partly responsible for this. He was George W Bush’s head of Latino outreach and later worked in the Bush White House as a strategist. It was Bush’s political mastermind, Karl Rove, who first got him involved with garnering Latino support, and that was from the very beginning of the primary season, at the Iowa straw poll.

By contrast, Romney didn’t have anyone working on speaking to Latinos until much, much later in the campaign – by which time, Rodriguez tells me, it was “way too late” to push for any possible victory.

Even though Hispanics in Texas voted in higher numbers than was expected in 2012, and even though they voted overwhelmingly for Obama, there’s still a question as to when they will reach optimal force and influence and, more pertinently, whether the vote will be so dissipated when that happens that it will become no more or less significant than the Italian vote or the German vote. Republicans are hoping that, as the Latino community becomes more assimilated, it will vote less on immigration and more on social and economic issues – issues that Republicans hope they can use to strike a chord with Latinos as a socially conservative Catholic community that places high emphasis on family values. But those same values will also mean Hispanics identify Republicans as being “not for them” long after they have assimilated.

Bush continued to be sensitive to Hispanic Americans throughout his campaign, saying in a speech during a campaign stop in Texas in 2000: “Family values don’t stop at the Rio Grande River . . . People are coming to America because they are moms and dads trying to feed their children. As long as people are coming to feed their families, our country must be mindful that they’re human beings as well.” Just imagine a Republican candidate winning in the primaries today after giving a speech like that.

It didn’t stop after Bush’s victory, either. In 2001, one of his first actions as president was to change the custom of a new White House administration inviting the Canadian leader to be the guest at its first state dinner: Bush’s first state dinner was with the president of Mexico. “Compassionate conservatism” was to be at the heart of his administration’s domestic policy, and that meant credible immigration and domestic reform. At last, here was a conservative willing – even eager – to reach out to the Latino community.

“And then,” Leonard Rodriguez says, “we got hit with 9/11. No longer was that [domestic and immigration reform] agenda we’d been working on a top priority . . . since then, [Republicans have] been hijacked by this very right-wing, anti-immigrant dialect, and that’s one of the things the party’s been struggling with ever since.”

Maria Baños Jordan says that when Romney started to speak out against immigration and talk about imposing “self-deportation”, she “immediately know it was over. It showed that, whatever advice he was receiving, he was absolutely out of touch with what was happening across the nation.

“It was sad, in the sense that I felt that there were many Latinos waiting for someone to step up and speak to them with respect and in a way that translated, and at that point it was obviously not going to happen. And I don’t think he ever recovered.” T here is no doubt that it is the Republicans’ stance on immigration that is destroying them. At present, there is little discernible sign of interest in the party in doing anything about it.

Rodriguez is deeply saddened by this. “If you look at the structure of the Republican Party, I doubt they’ll go back to what Bush was trying to teach them, even when the party gets its leadership together. They’ll go back to the bad habits. I don’t expect that there’s going to be any Hispanic personnel in the next Republican Party.”

***

Towards the end of my time in Texas, I finally make the pilgrimage to San Antonio to see the Alamo. The shape of the old building – actually the original chapel, where the women and children took shelter – is instantly familiar. Outside, schoolchildren, most of them Latino, are gathering. A preacher, old and bearded and spitting vigorously, harangues the crowd. It is December but it is still very hot outside. A sign says “Welcome to the Alamo: the shrine of Texas liberty”.

Inside, it is cooler. Tourists study the displays of banners and scale models of the battle that are scattered about. I speak to one, a US army veteran and third-generation Mexican American who is visiting with his family. I ask what this place means to him, and he nods over his shoulder at the elderly white couple gazing at a glass case with Davy Crockett’s leather pouch in it.

“To a white Texan, it means everything,” he says. Then he asks if I can quote him anonymously. Yes, I say, absolutely.

“Me personally?” He leans in towards me conspiratorially. “I don’t give a shit about this place.”

Nicky Woolf is a contributing writer to GQ and reports for the New Statesman from the United States

Nicky Woolf is a writer for the Guardian based in the US. He tweets @NickyWoolf.

This article first appeared in the 01 April 2013 issue of the New Statesman, Easter Special Issue

Jeremy Corbyn. Photo: Getty
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Lexit: the EU is a neoliberal project, so let's do something different when we leave it

Brexit affords the British left a historic opportunity for a decisive break with EU market liberalism.

The Brexit vote to leave the European Union has many parents, but "Lexit" – the argument for exiting the EU from the left – remains an orphan. A third of Labour voters backed Leave, but they did so without any significant leadership from the Labour Party. Left-of-centre votes proved decisive in determining the outcome of a referendum that was otherwise framed, shaped, and presented almost exclusively by the right. A proper left discussion of the issues has been, if not entirely absent, then decidedly marginal – part of a more general malaise when it comes to developing left alternatives that has begun to be corrected only recently, under Jeremy Corbyn and John McDonnell.

Ceding Brexit to the right was very nearly the most serious strategic mistake by the British left since the ‘70s. Under successive leaders Labour became so incorporated into the ideology of Europeanism as to preclude any clear-eyed critical analysis of the actually existing EU as a regulatory and trade regime pursuing deep economic integration. The same political journey that carried Labour into its technocratic embrace of the EU also resulted in the abandonment of any form of distinctive economics separate from the orthodoxies of market liberalism.

It’s been astounding to witness so many left-wingers, in meltdown over Brexit, resort to parroting liberal economics. Thus we hear that factor mobility isn’t about labour arbitrage, that public services aren’t under pressure, that we must prioritise foreign direct investment and trade. It’s little wonder Labour became so detached from its base. Such claims do not match the lived experience of ordinary people in regions of the country devastated by deindustrialisation and disinvestment.

Nor should concerns about wage stagnation and bargaining power be met with finger-wagging accusations of racism, as if the manner in which capitalism pits workers against each other hasn’t long been understood. Instead, we should be offering real solutions – including a willingness to rethink capital mobility and trade. This places us in direct conflict with the constitutionalised neoliberalism of the EU.

Only the political savvy of the leadership has enabled Labour to recover from its disastrous positioning post-referendum. Incredibly, what seemed an unbeatable electoral bloc around Theresa May has been deftly prized apart in the course of an extraordinary General Election campaign. To consolidate the political project they have initiated, Corbyn and McDonnell must now follow through with a truly radical economic programme. The place to look for inspiration is precisely the range of instruments and policy options discouraged or outright forbidden by the EU.

A neoliberal project

The fact that right-wing arguments for Leave predominated during the referendum says far more about today’s left than it does about the European Union. There has been a great deal of myth-making concerning the latter –much of it funded, directly or indirectly, by the EU itself.

From its inception, the EU has been a top-down project driven by political and administrative elites, "a protected sphere", in the judgment of the late Peter Mair, "in which policy-making can evade the constraints imposed by representative democracy". To complain about the EU’s "democratic deficit" is to have misunderstood its purpose. The main thrust of European economic policy has been to extend and deepen the market through liberalisation, privatisation, and flexiblisation, subordinating employment and social protection to goals of low inflation, debt reduction, and increased competitiveness.

Prospects for Keynesian reflationary policies, or even for pan-European economic planning – never great – soon gave way to more Hayekian conceptions. Hayek’s original insight, in The Economic Conditions of Interstate Federalism, was that free movement of capital, goods, and labour – a "single market" – among a federation of nations would severely and necessarily restrict the economic policy space available to individual members. Pro-European socialists, whose aim had been to acquire new supranational options for the regulation of capital, found themselves surrendering the tools they already possessed at home. The national road to socialism, or even to social democracy, was closed.

The direction of travel has been singular and unrelenting. To take one example, workers’ rights – a supposed EU strength – are steadily being eroded, as can be seen in landmark judgments by the European Court of Justice (ECJ) in the Viking and Laval cases, among others. In both instances, workers attempting to strike in protest at plans to replace workers from one EU country with lower-wage workers from another, were told their right to strike could not infringe upon the "four freedoms" – free movement of capital, labour, goods, and services – established by the treaties.

More broadly, on trade, financial regulation, state aid, government purchasing, public service delivery, and more, any attempt to create a different kind of economy from inside the EU has largely been forestalled by competition policy or single market regulation.

A new political economy

Given that the UK will soon be escaping the EU, what opportunities might this afford? Three policy directions immediately stand out: public ownership, industrial strategy, and procurement. In each case, EU regulation previously stood in the way of promising left strategies. In each case, the political and economic returns from bold departures from neoliberal orthodoxy after Brexit could be substantial.

While not banned outright by EU law, public ownership is severely discouraged and disadvantaged by it. ECJ interpretation of Article 106 of the Treaty on the Functioning of the European Union (TFEU) has steadily eroded public ownership options. "The ECJ", argues law professor Danny Nicol, "appears to have constructed a one-way street in favour of private-sector provision: nationalised services are prima facie suspect and must be analysed for their necessity". Sure enough, the EU has been a significant driver of privatisation, functioning like a ratchet. It’s much easier for a member state to pursue the liberalisation of sectors than to secure their (re)nationalisation. Article 59 (TFEU) specifically allows the European Council and Parliament to liberalise services. Since the ‘80s, there have been single market programmes in energy, transport, postal services, telecommunications, education, and health.

Britain has long been an extreme outlier on privatisation, responsible for 40 per cent of the total assets privatised across the OECD between 1980 and 1996. Today, however, increasing inequality, poverty, environmental degradation and the general sense of an impoverished public sphere are leading to growing calls for renewed public ownership (albeit in new, more democratic forms). Soon to be free of EU constraints, it’s time to explore an expanded and fundamentally reimagined UK public sector.

Next, Britain’s industrial production has been virtually flat since the late 1990s, with a yawning trade deficit in industrial goods. Any serious industrial strategy to address the structural weaknesses of UK manufacturing will rely on "state aid" – the nurturing of a next generation of companies through grants, interest and tax relief, guarantees, government holdings, and the provision of goods and services on a preferential basis.

Article 107 TFEU allows for state aid only if it is compatible with the internal market and does not distort competition, laying out the specific circumstances in which it could be lawful. Whether or not state aid meets these criteria is at the sole discretion of the Commission – and courts in member states are obligated to enforce the commission’s decisions. The Commission has adopted an approach that considers, among other things, the existence of market failure, the effectiveness of other options, and the impact on the market and competition, thereby allowing state aid only in exceptional circumstances.

For many parts of the UK, the challenges of industrial decline remain starkly present – entire communities are thrown on the scrap heap, with all the associated capital and carbon costs and wasted lives. It’s high time the left returned to the possibilities inherent in a proactive industrial strategy. A true community-sustaining industrial strategy would consist of the deliberate direction of capital to sectors, localities, and regions, so as to balance out market trends and prevent communities from falling into decay, while also ensuring the investment in research and development necessary to maintain a highly productive economy. Policy, in this vision, would function to re-deploy infrastructure, production facilities, and workers left unemployed because of a shutdown or increased automation.

In some cases, this might mean assistance to workers or localities to buy up facilities and keep them running under worker or community ownership. In other cases it might involve re-training workers for new skills and re-fitting facilities. A regional approach might help launch new enterprises that would eventually be spun off as worker or local community-owned firms, supporting the development of strong and vibrant network economies, perhaps on the basis of a Green New Deal. All of this will be possible post-Brexit, under a Corbyn government.

Lastly, there is procurement. Under EU law, explicitly linking public procurement to local entities or social needs is difficult. The ECJ has ruled that, even if there is no specific legislation, procurement activity must "comply with the fundamental rules of the Treaty, in particular the principle of non-discrimination on grounds of nationality". This means that all procurement contracts must be open to all bidders across the EU, and public authorities must advertise contracts widely in other EU countries. In 2004, the European Parliament and Council issued two directives establishing the criteria governing such contracts: "lowest price only" and "most economically advantageous tender".

Unleashed from EU constraints, there are major opportunities for targeting large-scale public procurement to rebuild and transform communities, cities, and regions. The vision behind the celebrated Preston Model of community wealth building – inspired by the work of our own organisation, The Democracy Collaborative, in Cleveland, Ohio – leverages public procurement and the stabilising power of place-based anchor institutions (governments, hospitals, universities) to support rooted, participatory, democratic local economies built around multipliers. In this way, public funds can be made to do "double duty"; anchoring jobs and building community wealth, reversing long-term economic decline. This suggests the viability of a very different economic approach and potential for a winning political coalition, building support for a new socialist economics from the ground up.

With the prospect of a Corbyn government now tantalisingly close, it’s imperative that Labour reconciles its policy objectives in the Brexit negotiations with its plans for a radical economic transformation and redistribution of power and wealth. Only by pursuing strategies capable of re-establishing broad control over the national economy can Labour hope to manage the coming period of pain and dislocation following Brexit. Based on new institutions and approaches and the centrality of ownership and control, democracy, and participation, we should be busy assembling the tools and strategies that will allow departure from the EU to open up new political-economic horizons in Britain and bring about the profound transformation the country so desperately wants and needs.

Joe Guinan is executive director of the Next System Project at The Democracy Collaborative. Thomas M. Hanna is research director at The Democracy Collaborative.

This is an extract from a longer essay which appears in the inaugural edition of the IPPR Progressive Review.

 

 

This article first appeared in the 01 April 2013 issue of the New Statesman, Easter Special Issue