Miles Cole for New Statesman.
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The pugilist: Sadiq Khan’s quest to become mayor of London

Can the Tooting MP complete the journey from council home to City Hall? 

One recent morning, Sadiq Khan entered the ring at Earlsfield Amateur Boxing Club in Wandsworth, south London. He ­began sparring with one of the regulars: ducking, weaving, throwing jabs. Khan learned to box as a boy, partly for self-defence; two of his brothers are coaches at the volunteer-run academy near Tooting, the constituency he has represented since 2005. Among those pictured on the wall is Frank Bruno, the club’s most famous son.

Khan had invited me to join him, and soon after I arrive at 10am, Pop, the youngest of his seven siblings, inducts me in the ring and we begin 90 minutes of training. “Boxing isn’t fighting,” Khan told me when I interviewed him two days earlier. “It’s a classic mistake people make – boxing is a sport. The skills you learn are life skills: being magnanimous, what to eat, how to keep fit, how to look out for each other. The first thing you learn in boxing is defence – you’ve got to defend yourself . . . We all boxed [in my family] and that gives you confidence if you get into bother on the street.”

The only one of his brothers not to compete at amateur level, Khan preferred football and cricket (he had trials for Surrey). But he moves with an agility seldom associated with MPs – many of whom are more likely to be found in the Palace of Westminster’s bars than its gym. As a devout Muslim, Khan does not drink, and in 2014 he ran the London Marathon.

During our warm-down we pass a road on which his father drove the number 44 bus. A few minutes away is the council estate where Khan grew up. He doubts that bus drivers today could afford to live in the area, and speaks with sadness at how gentrification has frayed the bonds of community. It was the fear that working-class Londoners were being denied the opportunities ­afforded to his family that partly inspired his candidacy for mayor of London.

***

In eight weeks, on 5 May, Sadiq Khan will compete in the UK’s biggest bout of all. With the exception of the French president, no European politician has a larger personal mandate than the mayor of London. The city's leader controls a £16bn budget and housing, planning and transport policy. If the government lives up to its devolutionary rhetoric, the next incumbent will acquire still greater powers.

For the past eight years, London has been led by Boris Johnson, who twice defeated his Labour predecessor, Ken Livingstone. But Khan is predicted to win back City Hall for Labour. Zac Goldsmith, the Tory MP for Richmond Park, whose billionaire father founded the Eurosceptic Referendum Party, was the candidate that many in Labour feared: telegenic, green (he edited the Ecologist magazine) and socially liberal. The Tories’ hope was that, like Johnson, Goldsmith would attract non-Conservative voters. Yet in a city that leans ever more towards Labour – the party won 45 of its 73 seats in last year’s general election – few believe he can emulate his predecessor. Fellow Tories have criticised his campaign as “low-energy”. The most recent poll, published by Opinium on 8 March, gave Khan a 10-point lead in the final round.

“I’m the least complacent person you’ll find but I’m quietly confident,” he told me.

Khan, colleagues often say, is “a winner”. At the 2010 general election, he defended his Tooting seat from an aggressive and well-funded Conservative challenge. In the same year, he managed Ed Miliband’s leadership campaign, masterminding the defeat of Miliband’s elder brother, David. In the 2014 local elections, after Miliband rewarded him with the post of shadow minister for London, Khan achieved Labour’s best result in the capital since 1971. At last year’s general election, on an otherwise morose night, the party gained seven seats in London, its strongest performance since 2001.

When Khan announced in May last year that he would stand to be Labour’s mayoral candidate, many expected him to be defeated by Tessa Jowell, the popular former Olympics minister. It was not an assessment that Khan ever shared. As David Lammy, who finished fourth in the selection contest, told me: “I remember Sadiq sitting in his office – it would have been six months before the campaign got going. He looked me in the eye and said, ‘You know, I am going to do this.’ He was steely about it and very clear in his own mind.”

Khan’s team emphasised an ­elementary but overlooked truth: it was Labour Party members and supporters who would choose the candidate. The party’s leftwards trajectory gave him the advantage. Unlike Jowell, an unashamed Blairite, Khan opposed the Iraq War, a totemic issue for activists. He worked hard to win the endorsements of Ken Livingstone, the Unite, GMB and CWU trade unions and his fellow London MPs. Khan’s nomination – if not support – of Jeremy Corbyn for the Labour leadership and his opposition to the Welfare Reform and Work Bill gave him further credibility among the party’s selectorate. His policies included a London Living Rent (based on a third of average local income) and a four-year freeze on Tube and bus fares.

While Jowell and other candidates attempted to appeal to existing party members, Khan recruited new ones. Over the four-month campaign, he made more than 200 visits to workplaces, community centres, churches, temples, mosques and shopping malls. “The thing that should never be underestimated with Sadiq is his ability to campaign,” Lammy told me. “He’s a bit like a terrier; when he gets his teeth into something he’s not going to let it go.” Jowell simply told me that Khan was a “formidable campaigner” and that “all the signs are that he’s going to win”.

When the selection result was announced on 11 September 2015, with Khan beating Jowell 59-41 in the final round of voting, many were stunned by his landslide victory. But not him. “I never thought it was going to be a close race,” he told me just after the result was announced at the Royal Festival Hall. “I always knew – irrespective of what respectable London newspapers may write and who they’re going to endorse – when it comes to voters seeing what the candidates stand for and what their vision is, I’d win.”

No one I spoke to doubted Khan’s political skill, but some questioned his integrity. “He has got a tendency to want it so much that he slightly overeggs it,” a senior Labour MP told me. “Some of that mud will get thrown at him: that he changes his position, that he is politically expedient – and that then goes to trust. What does he really stand for?”

Having nominated Corbyn for the leadership, Khan was derided for sharply rebuking the new Labour leader in a Mail on Sunday interview on 20 September. He warned that Corbyn’s meetings with Hamas and Hezbollah reinforced Labour’s “anti-Jewish” image, criticised him for failing to sing the national anthem (“He was very unwise. You are trying to be the British prime minister”) and vowed to “work closely with a Tory government if it is in London’s interest”.

Such comments, opponents suggested, would never have been made during the selection contest for the mayoral candidacy – when he needed the Corbynites. But he insists there was no inconsistency. “I was quite clear when I nominated Jeremy that I wasn’t going to vote for him [Khan endorsed Andy Burnham]. Look on my Twitter timeline. And, George, in the selection process I was asked whether I would serve in his shadow cabinet, if I wasn’t successful, and I said no – because we come from different parts of the party. We believe in different things.”

Without the help of Khan and other non-supporters, Corbyn would not have made the ballot. Khan insisted that he had no regrets. “Jeremy Corbyn, to give him some credit, won among Labour Party members, among Labour Party supporters and among trade union supporters . . . You can have an analysis of why the other candidates failed to inspire, enthuse and engage with the membership, whereas Jeremy did, and that’s a conversation for them to have.”

He rejected the suggestion that his victory was a by-product of Corbynism. Were that the case, he said, one would have expected Diane Abbott or Christian Wolmar (both of whom voted for the eventual leader) to win. “The reason why that didn’t happen was because in my campaign I managed to enthuse, inspire and engage the selectorate. My mandate is similar to Jeremy’s, almost 60 per cent ... We were fizzing with energy, we had ideas and we won.”

His attempts to distance himself from the Labour leader have led the Tories to label him “Corbyn’s man”. At a Goldsmith rally on 26 January, David Cameron warned voters that they would be “lab rats in the first Corbyn economic experiment in public life” if Khan won.

However, in tacit acknowledgement of the risk posed by Corbyn’s unpopularity, Khan does not plan to appear in public with him in the lead-up to May (to the consternation of Corbyn’s allies). The leader’s role will be limited to voter mobilisation: leafleting, fundraising and phone banking. Yet Corbyn has more cause than most to hope that Khan is successful. Labour is forecast to become the first opposition since 1982 to lose council seats in a non-general-election year; retaking the mayoralty would provide crucial consolation.

Khan is also avoiding campaign appearances with Livingstone and has ruled out giving him a job if he wins. “If you’re running for mayor, your job is to represent London – you’ve got to stand up for London,” Livingstone said of Khan. “You often have to disagree with a Labour government, as I had to. It’s a campaign between Zac and Sadiq; it’s not a rerun of me and Boris. We should keep out of it.”

***

The day after Corbyn made the Labour leadership ballot on 15 June last year, Khan was again accused of expediency when he announced that he opposed a third runway at  Heathrow Airport in favour of Gatwick. “Sadiq was for Heathrow expansion in 2008; he was for it when he was transport minister in 2009. Zac Goldsmith has announced he is running [the Tory candidate is a long-standing opponent], and suddenly he’s against it,” Lammy told a mayoral hustings. But Khan denied that his stance was born of opportunism. “It was born out of the facts. Unlike Zac Goldsmith, I accept the case for an increase in flight capacity in this part of the country. I think the case has been made for jobs and growth.

“But in the last full year for which there’s data almost 10,000 Londoners died because of air pollution. There are children in parts of London whose lungs are underdeveloped. The UK Supreme Court last April held that the air-quality directive had been breached. So air is a killer – it makes you sick and it’s illegal. In those circumstances, you can’t say yes to a new runway at Heathrow.”

At Gatwick, he added, far fewer people were affected by air and noise pollution.

The Tories have recently levelled a far graver charge than that of Corbynism or opportunism: that Khan is a friend of Islamist extremists. On 7 February the Sunday Times reported that Khan had attended four meetings of the group Stop Political Terror (while campaigning against the US-UK extradition treaty), which had the support of Anwar al-Awlaki, the late al-Qaeda cleric. On 12 February, across two pages, the London Evening Standard noted that Khan’s former brother-in-law, Makbool Javaid, had attended events organised by the extremist group al-Muhajiroun in the 1990s (the pair have not spoken for a decade). Four days later, MailOnline reported that Khan had given a speech at the 2008 Global Peace and Unity festival while the “black flag of jihad” was flying.

Nick Timothy, a former chief of staff to the Home Secretary, Theresa May, told me: “Khan wants to be the mayor for millions of Londoners at a time when the terror threat is very real. An attack could happen at any time and he would have to respond and unite the city in those circumstances – he will be responsible for policing and community relations. He’s campaigned against the role of the police and allowed himself to share platforms with people who very definitely have the wrong kind of views. It’s not very good judgement if he wants to be the mayor of a city like London.”

Such comments frustrate Khan. “People who understand politics understand what happens at these things,” he said. “What happened was very simple.

“Many MPs from all parties, including Boris Johnson and Zac Goldsmith himself, had objections to the US-UK extradition treaty . . . Now, often when there are meetings happening about a cause, what happens is you’re very busy; the meeting may have been taking place for two, three, four hours; you’re doing other stuff. You go along, you take the stage, you do your spiel, you speak and more often than not just leave to do your next event.

“Often you’ve got no idea who was speaking before you, who’s speaking after you. Nobody could honestly, hand on heart, think I agree with the sort of views spouted by other people who spoke at the same meetings: that’s not the way it worked.

“I’ve been quite clear in my views in relation to extremism and radicalisation. I’ve been quite clear in my views in relation to people who claim to follow the same faith as me but have views that are abhorrent.”

He added: “So, what are you implying by your nudge-nudge and your wink-wink? What are you saying either about me or about the one million Londoners of Islamic faith? I get people approaching me all the time who are Muslim who say, ‘If they’re doing this to you, what chance have I got?’ or, ‘You’re encouraging us to get ­involved in mainstream politics yet this is how you’re treated’ or, ‘If they’re digging around, as they’ve been for months, about your extended family – about who used to be related to you, or whatever – what chance have we got?’”

He spoke of his dismay that Goldsmith, who some believed would shun such tactics, had pursued this path. “Those advising Zac to do this sort of stuff, it’s foolish advice. I thought Zac was bigger than this.”

Khan has received death threats from extremists for his involvement in democratic politics and, more recently, for supporting equal marriage. Friends say that despite the political and physical risks posed by taking this stance, he never hesitated. As a former human rights lawyer and champion of civil liberties (he chaired Liberty for three years), it was an automatic choice.

In a speech to the Parliamentary Press Gallery in November, a week after the Paris terror attacks, Khan spoke of how “successive governments had tolerated segregation in British society” and had allowed “the conditions that permit extremism to continue unchecked”.

He warned: “We’ve protected people’s right to live their cultural life at the expense of creating a common life. Too many British Muslims grow up without really knowing anyone from a different background, without understanding or empathising with the lives and beliefs of others.”

None of this has prevented his rivals making the claim that he is a friend of extremists and, by implication, one himself. But unlike Livingstone, who responded vociferously to accusations of anti-Semitism, Khan has maintained his composure.

“I’ve watched him go through this extremism row two or three times quite closely,” an MP told me. “He’s extraordinarily calm under that level of pressure. He draws on a well of inner stability that is really impressive. Tony Blair could obviously do it in spades but there are not that many senior politicians who can do it.”

***

Sadiq Aman Khan was born on 8 October 1970 at St George’s Hospital in Tooting. His grandparents emigrated from India to Pakistan following Partition; his parents emigrated from Pakistan to London shortly before his birth. Khan was the fifth of eight children (he has six brothers and one sister). His late father, Amanullah, was a bus driver for more than 25 years; his mother, Sehrun, was a seamstress.

Khan attributes his work ethic to his upbringing. “My dad worked all the hours that God sent as a bus driver. If he got overtime he’d take it. My mum not only raised eight children but was sewing clothes in the house while raising us, while cooking.

“I was surrounded by my mum and dad working all the time, so as soon as I could get a job, I got a job. I got a paper round, a Saturday job – some summers I laboured on a building site.”

He was taught to support those in need. “My mum and dad would send money to their relatives back in Pakistan. My mum still does, because we’re blessed being in this  country.”

The family grew up on the Henry Prince council estate in Earlsfield, where Khan and his seven siblings squeezed into a three-bedroom home. He did not travel abroad until he was 23 and slept in a bunkbed until he was 24. He attended the Ernest Bevin comprehensive school (named after the former Labour foreign secretary), which Independent editor Amol Rajan described as “the dreaded second choice ... the staple of local news reports about drugs, gangs and local hoodlums.” I asked Khan if this Tarantino-esque description was accurate.

“Listen, I’m very careful of speaking about certain things because it gives the impression ... Look, it’s still a school and children still go there, you don’t want to tarnish the reputation of the school. It was a great school, it fulfilled my potential. I’m not one of these people who moans that I could have been this if I’d gone to this school. It was a great school, the teachers worked their socks off.” He added: “It was a tough school, though, you had to be streetwise, you had to look after yourself.”

Racism was a feature of the family’s life. Bus passengers referred to his bearded father as “Paki Santa” and assaulted him. Such insults sometimes prompted Khan to use his boxing skills. “We went down on the floor hitting each other,” he told the Mail on Sunday of one fight. “He didn’t call me the ‘P-word’ again.”

Khan and his brothers also encountered racism on the football terraces. “I experienced Wimbledon, my brothers experienced Chelsea,” he told me. “At Stamford Bridge there’s a place called ‘the shed’. The NF [National Front] would sell newspapers and wear boots and the green bomber jackets and chase people like my brothers away, call them names.

“I didn’t support Chelsea because I didn’t want to support a club that had racist fans. Plough Lane was down the road ... I remember going to watch Wimbledon vs Spurs, it was an FA Cup game. Although I was a Wimbledon fan, at the Wimbledon end, after the game I was racially abused by fans using the Y-word and the P-word.

"I didn’t go back to Plough Lane.”

He then spoke movingly of the extent to which London had progressed. “My daughters [Anisah and Ammarah] are 16 and 14 and they’ve basically grown up in the same area that I grew up in and my wife grew up in. They’ve never been called the P-word – they’ve never been the victim of overt racial abuse. That shows the progress we’ve made.”

At school, a teacher told Khan, who studied biology, chemistry and maths at A-level, “You’re always arguing. Why don’t you be a lawyer, rather than a dentist?” It was this, as well as LA Law on television, that inspired him to join the Bar. He studied at the University of North London (now London Metropolitan), where he became a visiting lecturer, and took his finals at the Guildford College of Law. Having joined Labour at the age of 15, he was elected as a councillor in Wandsworth in 1994. That same year, he married Saadiya Ahmed, a fellow solicitor.

Khan told me he made a conscious decision to specialise in human rights law (“acting for the underdog”), rather than corporate law. “It wasn’t work for the sake of becoming a millionaire. It was working hard and giving something back.”

He became a trainee solicitor in 1994 at Christian Fisher under the renowned human rights lawyer Louise Christian. Three years later, he was made a partner – a precocious achievement for someone of his age and background. In 2004 he left the company, which had been renamed Christian Khan, to become the Labour candidate for Tooting. Khan and his former partner, who was aggrieved by his sudden departure, have not spoken since.

As a human rights lawyer, he acted for what he recently described as “unsavoury individuals”, such as Louis Farrakhan, the leader of the Nation of Islam, and Babar ­Ahmad, who pleaded guilty in the US in 2013 to “providing material support to terrorism”. Ahmad, whose extradition was opposed by Khan and other MPs (including Goldsmith), was a childhood friend. Khan’s opponents have sought to exploit this.

“We never went to each other’s houses. We weren’t close friends but we knew each other growing up – we’d see each other at mosques,” Khan told me. “When you see people at the mosque you don’t discuss politics and stuff. It’s, ‘How you doing? How’s things?’ You may play cricket together, as most kids do at the park and stuff. I can’t remember having an argument about his views in detail. What I do know is that when he was arrested it was a big deal because he was the victim of police misconduct. He brought a claim and won damages in relation to how he was treated – he suffered serious injuries.” Khan has seen Ahmad twice since he was released from prison in the US: at a funeral at Balham Mosque and on the Tube with his lawyer.

In 2005, Khan was elected as the MP for Tooting, his lifelong home. He was praised by former shadow business secretary Chuka Umunna, who represents neighbouring Streatham, as a constituency champion. "In spite of the fact that he's had a national role he was never seen to have taken his eye off the ball of the local situation," he told me. 

Six months after entering parliament, Khan rebelled over Tony Blair’s attempt to introduce 90-day detention for terror suspects, the first of several clashes with the then prime minister. In 2006 he signed an open letter warning that the government’s foreign policy provided “ammunition to extremists”. On the tenth anniversary of the 7 July 2005 London bombings, he spoke of how Blair had “called the four MPs of Islamic faith in to No 10 and sat us round a table and said – to Mohammad Sarwar, Khalid Mahmood, Shahid Malik and myself – it was our responsibility.

“I said: ‘No it’s not. Why have you called us in? I don’t blame you for the Ku Klux Klan. Why are you blaming me for the four bombers on 7/7?’” (This account is contested by Mahmood and Malik, who accused Khan of “self-serving revisionism”.)

“They’re allowed to recollect things how they like,” he told me. “I’m quite clear in my recollection . . . It reinforces my view that we’ve got to defeat radicalisation and extremism by all of us working on this – this isn’t a uniquely Muslim problem. There’s a great saying, which is, ‘It takes a village to raise a child.’ Similarly, it will take a village to defeat terrorism and extremism.”

In Gordon Brown’s 2008 reshuffle, Khan was appointed communities minister, becoming the second Muslim to serve in government. The following year he was made transport minister: the first Muslim to attend cabinet and become a privy counsellor. “The palace called me and said, ‘What type of Bible do you want to swear on?’ When I said the Quran, they said, ‘We haven’t got one.’ So I took one with me.”

Of his faith, he told me: “It’s part of who I am – that’s the best way of describing it, because I’ve been asked this a lot. We all have multiple identities: I’m a Londoner, I’m British, I’m English, I’m of Asian origin, of Pakistani heritage, I’m a dad, I’m a husband, I’m a long-suffering Liverpool fan, I’m Labour, I’m Fabian and I’m Muslim.”

I asked him how he felt when an LBC/YouGov poll was published showing that 31 per cent of Londoners would be “uncomfortable” with a Muslim mayor. “That was during the selection campaign. When I saw it I was thoroughly depressed.

“When you’re the candidate in a campaign, you’ve got to be strong; you’re the leader. I went to the campaign – we’ve got lots of volunteers – three of my volunteers of Islamic faith were devastated. Two of them were crying. They just didn’t want to carry on because they were devastated that the impression was given that three out of ten Londoners are somehow Islamophobes.

“That’s not what the survey was about. With surveys, with polls, it’s how you ask the question. If I ask you the question, ‘Wouldn’t it be great if the mayor of London was of Islamic faith?’, what sort of message would that send? It elicits a very different answer to, ‘How comfortable are you with the mayor of London being a Muslim?’ And so I’ve spoken to people at LBC who on reflection realised that the question maybe shouldn’t have been asked, or at least asked in a different way.

“You can slice and dice it whichever way you want, this is a great, great city. There is no other city I’d rather raise my daughters in. I’ve got cousins in Pakistan, ethnic majority and religious majority, and they say to me they couldn’t achieve in Pakistan what I’ve achieved here.

***

For some politicians, campaigning is mere business; for Khan it is a pleasure. I joined him in east London as he visited start-ups hosted by the Bootstrap Company in Dalston: a film-maker, a bakery, a dressmaker. “Are you making a profit yet?” he asked. At a time when his party is increasingly perceived as “anti-business”, Khan takes every opportunity to present himself as a friend of enterprise. He has been aided by Goldsmith’s decision to support Brexit.

“We’re a city where literally more than 500,000 jobs are directly dependent on us being a member of the EU,” he said. “We’re a city where 60 per cent of the world’s companies choose their headquarters. Forty-three per cent of London’s exports go to the European Union. In those circumstances, if you want to be a good mayor, how can you be in favour of leaving?”

Goldsmith has argued that a Conservative mayor will invariably get a better deal from the government, a notion that Khan dismisses. “To give the current government their due, they do business with a Scottish Parliament, which is not Tory . . . they do deals with the Welsh Assembly, which is not Tory. They’ve given greater devolution to Greater Manchester, which is not Tory and probably never will be.

“I actually get on with George Osborne and other members of the government. Many of them sponsored me when I did the marathon. I think I’m friends with some of them.” Osborne, a fellow Londoner, personally congratulated Khan when he won the mayoral nomination.

Khan’s name is often mentioned alongside that of Sajid Javid, the business secretary and fellow bus driver’s son (“I’m the son of a bus driver. I used to love that line ... then Sajid fucking Javid came along,” Khan quipped during his press gallery appearance). “I saw him the other night, actually,” he said. “I think one of the great things about politics now is if you’re an ethnic minority the sole party for you to choose isn’t the Labour Party. That’s fantastic, I think, it’s really encouraging that both mainstream parties have embraced the importance of reflecting society.”

During his time in the shadow cabinet, Khan was one of Ed Miliband’s closest allies and a tribune of the soft left. But he told me that he no longer supports signature policies such as a 50 per cent income-tax rate or a “mansion tax”.

“It’s really important to understand that we had a manifesto, which we fought the 2015 election on, and we lost – we lost badly for the second time in a row.

“In the Eighties when we were losing elections, members of my party had a phrase, which I think was wrong, which is ‘no compromise with the electorate’. The electorate are always right.”

In his book If Mayors Ruled the World, Benjamin Barber writes that “a preference for pragmatism and problem-solving over ideology” is a feature of successful city leaders. It is a model that Khan – like Ken Livingstone before him, a socialist who forged an alliance with big business – has embraced.

If Sadiq Khan wins the race to lead London, he will capture a prize that increasingly eludes Labour outside the city: elected office. The election of a British Muslim mayor would be an event of international significance, and a symbol of London’s cosmopolitanism. “I’m fed up of losing. I don’t believe in heroic failure,” he told me. “I’ve got the policies, I’ve got the principle. We need the power to improve London.”

George Eaton is political editor of the New Statesman.

This article first appeared in the 10 March 2016 issue of the New Statesman, American Psycho

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 10 March 2016 issue of the New Statesman, American Psycho