European options

As I mentioned in my post on the British election result, one certain consequence of it was that there will be a referendum as to whether the UK remains in the European Union. This will have major consequences for Britain and for British businesses but also for the EU itself and for those doing business with Britain, and for those who currently come to live, work and study in Britain, and, actually, for the way the world geo-politics are configured.

Already there have been some important developments. First, who will get to vote in this referendum? There are various possibilities but what seems to have emerged is that the electorate will be those entitled to vote in a British general election. One consequence of this is that it excludes 16 and 17 year olds, unlike last year’s referendum on Scottish independence. Another is that citizens of other EU countries living in the UK will not have vote unless they have joint citizenship (there are some technical reasons why this does not apply to Irish, Maltese and Cypriot citizens in the UK). A third is that British citizens who have lived abroad for 15 or more years will not be able to vote.

This decision on the franchise can be seen as an attempt to assuage the demands of those who want Britain to leave the EU, in particular by excluding EU immigrants, which looks like smart politics from British Prime Minister David Cameron, who is widely believed to want the UK to stay in the EU. It heads off accusations of a rigged vote. On the other hand, it seems entirely illogical. If Britons who have lived in other EU countries for more than 15 years aren’t allowed to vote (apparently on the grounds that they have substantively exited the UK for another country) then why aren’t those from other EU countries who have lived in the UK for more than 15 years (and so made a similarly substantive commitment to the UK) not allowed to vote?

I know a great many people in both camps and in fact two of my closest friends are a French woman who has lived in the UK for 20 years, has a business, husband and children here but can’t vote, and an Englishman who has lived in France for almost 30 years but has children in the UK and pays taxes here but can’t vote. What such examples really show is that the extent of European integration already makes it absurd to try to separate out a British and non-British electorate.

The other big development has been an indication that the question asked in the referendum will be in the form (if not the exact words) of ‘should Britain remain a member of the EU’. This is significant because it means that those arguing to stay in will be arguing for a ‘yes’ vote, which is believed to be more psychologically appealing than asking people to vote ‘no’. Thus, unlike the decision on franchise, this seems to be likely to favour the pro-EU case (and hence has been criticised by those who want Brexit).

Alongside these really very important developments, the British Prime Minister has begun the process of ‘re-negotiation’ with the EU. It is not really clear what this means as there is no forum for such a re-negotiation and no mechanism for it. Anti-Europeans perceive, rightly I think, that no fundamental re-negotiation is possible, certainly not on the key issue of free movement of labour. The question is whether something that looks like a substantive re-negotiation but isn’t can be presented to the electorate as if it is. This is the hope of the pro-EU group and the fear of the anti-EU group.

Yet this attention to the terms on which Britain might stay in the EU completely fails to address the equally, or even more, important question of the terms on which Brexit might happen. Those advocating it oscillate between, and often treat as interchangeable, quite different scenarios.

One is direct single market access via European Economic Area (EEA) membership (the ‘Norway’ option). This is perfectly feasible, but wouldn’t deliver what Eurosceptics say they want. Not in terms of sovereignty (Norway has less control than the UK over the single market rules it must abide by), cost (Norway pays more per head) or immigration (there is still free movement of people) or the ability to negotiate third party free trade agreements (it does so via EFTA*).

A second scenario is single market access via European Free Trade Area (EFTA) membership by multiple bilateral agreements (the ‘Swiss’ option). That is much less feasible, as Switzerland’s idiosyncratic position developed piecemeal over many years. A Brexit on this model would have to negotiate multiple separate agreements (Switzerland has 120) over an unknown timescale with no way of knowing the outcome. The Swiss model does not enable free movement of services, which would be a major problem for the UK’s service-based economy. Moreover, the EU Commission is deeply hostile to the Swiss approach to free movement of people, and it is simply inconceivable that an opt-out on free movement would be granted alongside EFTA membership any more than it could be re-negotiated within the framework of EU membership.

The third scenario is a Free Trade Agreement (FTA) with the EU. It is absolutely crucial to understand that this is not the same as single market membership. In general, FTAs eliminate tariffs, whereas a single market eliminates non-tariff barriers to trade and harmonises regulation.  A particular difference, appealing to some Brexiters, is that an FTA would exempt the UK from free movement of people. But the consequence would be that 2 million or more British people working or living in the EU would lose their automatic right to live there, so Brexiters need to explain what arrangements would be made for them and for their families. It’s no good imagining that things would go on as at present or that post-Brexit the EU is ‘bound’ to accept British immigrants on rules other than those applying to other countries. Brexit (in this third sense) won’t just be some sort of game, it will be a fundamental shift in which Europeans lose their right to move freely to Britain and Britons lose their right to move freely around Europe.

A UK FTA with the EU would also mean ceasing to have access to the FTAs held between the EU and other countries such as South Korea and Singapore – in due course the UK might sign new deals, but that could not be guaranteed nor would the terms and timeframe be known.  What is certain is that the UK on its own could never get a better FTA deal with such countries than that which it enjoys via the EU, for obvious reasons of market scale.

The key question would be whether the EU would sign such a deal, on what terms and in what time frame. It cannot be assumed that a deal would be inevitable ‘because the UK is a big economy’: plenty of bigger economies don’t have an FTA with the EU. Anyway, it’s also the terms that matter: not all FTAs are the same.  As regards time frames, the EU deals with Singapore and South Korea took several years to negotiate: these kinds of arrangements are incredibly complicated. What happens in the meantime? Brexiters don’t say because they don’t know. They sometimes say that on exit it will just be a matter of trading on WTO terms. But the WTO does not establish global free trade, which is why individual countries negotiate FTAs within the WTO framework. For example, under WTO ‘most favoured nation’ rules, on Brexit the UK would pay a 15% tariff on food exports to the EU and a 10% tariff on car exports. Of course trade would not completely cease on Brexit, but the issue is on what volume and on what terms.

Even more fantastical is the idea floated by some Brexiters of the UK joining a Commonwealth free trade area. There is no such entity and no plans or possibility to create one. This idea is simply nonsense.

It’s hard to resist the conclusion that the anti-EU camp deliberately confuse the very clear differences between these Brexit scenarios. When challenged that leaving the EU will mean exiting the single market they invoke the Norwegian or Swiss model; when arguing that leaving the EU means avoiding the free movement principle they invoke the FTA model. This slippage really needs to be confronted and challenged by what we now know will be the ‘yes’ campaign. And that campaign needs to do something more than present the economic case for staying in: the EU represents not just an economic bloc but also offers multiple opportunities for study, research, culture and retirement. Moreover, it operates to secure peace within Europe and is a force for projecting a European view into the world polity.

It’s a perfectly reasonable to say that we should leave the EU. But if the British people are to be asked to vote for EU exit they deserve to be given a proper explanation of what happens next.  Just saying airily that it can all be negotiated afterwards isn’t good enough, nor is it good enough to conflate the very different options just outlined. And it will certainly be no good saying afterwards that ‘we didn’t understand what we were voting for’, the repeated complaint made by Eurosceptics about the 1975 Referendum. By then it will be too late. There’s no way back in. Which is what makes it a big moment.

 *There is a lot of confusion in these debates about the meaning of EFTA and the EEA, and their relation to the EU. Briefly, the EEA members are Iceland, Liechenstein and Norway. EFTA consists of those three countries plus Switzerland. Both EEA and EFTA groups are de facto subject to EU principles and regulations.

Working assumptions

This post is inspired by Martin Vogel’s thought-provoking piece, on the excellent Vogel Wakefield counter-consultancy blog, where he discusses the politics of organization. In particular, he points out how little conversation there was during the British election of the changing nature of work, the social purposes of business and similar themes. With economic debate (and not just in Britain) dominated by the single theme of government fiscal deficit and cultural debate by that of immigration, work – so central to most people’s lives – barely got a look in.

True, there were some marginal references. Labour did seek to open up issues of lack of employment security, lack of quality jobs, and zero hours contracts. The Conservatives did talk at times about the number of jobs created in the British economy in recent years. Both parties talked occasionally about apprenticeships. But huge issues about under-employment, about the effect of technological change on white-collar employment, and about productivity (again, see Martin Vogel’s post for more on this) didn’t get mentioned at all. Moreover, nothing much was said on the many issues adjacent to or around work – for example the highly uncertain future of pensions and the exploding need to provide care for the elderly, much of which will be done as unpaid work, especially by women.

Perhaps it is the case that modern politics is incapable or unwilling to talk about such large and long-term issues. Indeed, it is not just in relation to work that big issues are neglected. In particular, no one in British politics seems willing to take a good look at Britain’s role in the world, something which has been ducked since, arguably, 1945. In fact, with the exception of the issue of EU membership, foreign policy of any sort did not figure in the election. And this is not just an issue for Britain. The mechanisms of international governance seem unable to gain any traction at all on a range of pressing problems from Ukraine, through to the dire and increasingly unstable situation right across the Middle East. The central structures of the UN, specifically the permanent membership of the Security Council, again reflect the world in 1945, not 2015.

One factor here – pertaining to work as much as to security – is the way that globalization, whilst largely created by the decisions of nation-states, has now undercut the purchase that nation-states have upon policy, leaving a political vacuum. From this viewpoint, what can national politicians say about, for example, job insecurity, pensions or de-skilling other than to see it in terms of the ineluctable effects of the global free market? The same could be said about things such as corporate tax avoidance which I posted about earlier this year. We just don’t have the political structures to deal with this situation, and very few people talking about how we might create them.

Yet there are some levers which national governments do have, especially around education and training, that might be pulled at least with respect to issues of employability and productivity. One reason why they do not get much discussed is, I suspect, the increasingly dysfunctional effects of media management. Political strategists seek simple, constantly repeated mantras to ‘frame the narrative’ – the fiscal deficit being the obvious example – which are by definition incapable of speaking of or to complex, inter-related problems. Add to this the almost inevitable short-termism of the electoral cycle and it is perhaps unsurprising that long-term problems get shelved for another day – witness the huge difficulties of developing a global approach to environmental sustainability.

Coming back to work, and thinking just from the standpoint of organization studies, I think that one striking and problematic feature of the subject is just how little it actually has to say about work. This is partly to do with the demise of what used to be called industrial sociology and the concomitant rise of studies that are more concerned with consumption and identity than production and the workplace. It probably also reflects the way that organization studies takes place almost entirely inside management and business schools, with more emphasis on management than on work per se. It certainly reflects the growing ‘theoreticism’ of the academic literature, with a disdain for ‘merely’ reporting what is actually happening in the workplace and an insistence that each academic paper should make a suppose ‘theoretical contribution’, something I’ve discussed elsewhere on this blog. As Barley & Kunda argued in 2001, there is a need to “bring work back in” to the discipline, but it is an argument that more than decade later shows little sign of being heeded.

In 1974, in a book probably better known in the United States than elsewhere, the writer and oral historian Studs Terkel published Working. People Talk About What They Do All Day and How They Feel About What They Do, the title of which is self-explanatory. Its coverage ranged from farm workers to dentists, tennis players to nuns. It’s difficult to think of anything remotely like this book now, and certainly not anything by an organization studies academic. The neglect of work within political discourse may be an intractable problem but within the more limited terrain of organization studies may not be irredeemable. And who knows, perhaps the two might be linked. After all, an organization studies that educated students into the realities of contemporary working life might not only prepare them better for those realities but also encourage them to ask political questions about it.

 

References

Barley, S. and Kunda, G. 2001. ‘Bringing work back in’, Organization Science 12: 76-95.

Terkel, S. 1974. Working. People Talk About What They Do All Day and How They Feel About What They Do. New York: Pantheon/Random House.

Old New Labour

I’m going to continue with my posts about what is now the aftermath of the British election but before doing so I just want to restate why I am doing so on a blog which is first and foremost about studying organizations. There are two reasons. On the one hand, politics and organizations are really inseparable. The British political landscape matters for both British businesses and public sector organizations. But more importantly what lies at the heart of British politics, and has done for at least three decades now, is a contestation about different models of capitalism and of organization.

Britain matters not because it is still the seventh largest economy in the world, but because it has been the template and cheerleader for the ‘Anglo-Saxon’ model of capitalism with all that implies for organizations in terms of an emphasis on shareholder value, labour market flexibility, privatization and deregulation. Crucially, this conception of how to organize both the economy and work has been a joint production of Conservative and ‘New Labour’ governments. In that context, the defeat of Labour in the recent election matters, as to a limited extent the party offered a break with this model, by urging greater regulation of markets and more protection for workers. So its defeat has implications for the future of organizations and of working life.

In this post, I want to focus on what has been a wholly predictable response to Labour’s defeat by the architects of New Labour. Both Tony Blair and Peter Mandelson have denounced Labour’s campaign for its failure to occupy the ‘centre ground’, by which they mean departing from that Anglo-Saxon model. If Labour is to win, they say, it must go back to being ‘New Labour’, whose defining hallmark was to accept the Thatcherite or neo-liberal settlement.

There is a huge irony in this. The central tent of New Labour in the early 1990s was that circumstances had changed and that Labour therefore also needed to change to reflect this. Yet now that formula, now more than two decades old, is held up as an unchanged and unchangeable verity. But even if it were to be accepted that the New Labour diagnosis were right at the time – and that is highly questionable, because by the time of their 1997 election victory pretty much any alternative to the Conservatives would have been a winner, so discredited – it isn’t right now.

Labour lost the 2015 election for two main reasons. First, because its hitherto impregnable heartlands in Scotland switched to the SNP because it offered a more social democratic programme. Those voters were sick of New Labour and won’t be regained by returning to New Labour. Second, because in key English marginal traditional Labour voters switched to UKIP, mainly because of anti-immigrant sentiment much of which derives from New Labour’s European policy. So, again, those voters aren’t going to be won back by a return to New Labour. But, equally, Miliband’s Labour were far too scared of the issue of immigration – probably because of the disastrous ‘Mrs Duffy moment’ of the 2010 election – to really challenge those voters. At all events, Labour’s 2015 travails were the consequence of New Labour, and cannot be solved by a return to New Labour.

Generals always fight the last war, not the present one, and the interventions of the New Labour old guard are a perfect example. If there is to be an effective strategy for Labour in the future it won’t be based upon nostrums derived from a quarter of a century ago, any more than New Labourites would have based their early 1990s approach on the basis of what worked in the late 1960s.

British election result: Decisively indecisive

So the British election is over, and it has turned out to be rather different to what the polls predicted, with a majority Conservative government having been elected. At first sight, it’s a return to business as usual – one of the two main parties forms the government. At second sight, things look much more complex and unstable.

For one thing, this will be a UK government which is really only supported in England. In particular, the fact that the SNP won almost all of the Scottish seats has radically changed the political landscape, and can only make it more likely that there will be pressure for second referendum on Scottish independence. But Wales and Northern Ireland, too, have not supported the Conservatives in number, yet will have a Conservative government. That may well place limits on what is seen to be legitimate.

On the other hand, the fate of the predominantly English UK Independence Party (UKIP) was notable. Despite being given unprecedented media coverage after the broadcasting regulator declared that they were to be treated as a major party, their claims to be a People’s Army on the move have been eviscerated. They got 13% of the vote and just one MP. Sure, this reflects the unfair nature of the First Past the Post voting system in the UK but they knew about that all along, and still made grandiose predictions. This looks, for the time being anyway, to be the end of the UKIP surge.

The failure of the Labour Party is truly historic, mainly because they have lost their traditional Scottish heartland to the SNP, whilst also losing out in England. The Scottish situation is really the final consequence of the New Labour project, which presumed that it could move the party to the right in order to garner English marginal votes and automatically hang on to its core vote. This election finally saw that idea fall apart. Labour had actually moved a tiny way to the Left but still lost Scotland, and additionally alienated the old Labour North and the floating south of England. They just about held on in Wales. It’s very hard to see where Labour go now. Returning to a New Labour approach certainly won’t bring Scotland back to them. Going further to the Left won’t give them gains in the south of England.

Yet it could be argued that this was a good election for Labour to lose: had they, as the polls up to the election suggested, formed a minority government with SNP support then it would have been a torrid experience, beset by accusations of illegitimacy. Equally, Conservative joy may dissipate when the problems of managing a small majority with a large number of MPs hostile to their leader and willing to vote against their party become clear.

But by far the biggest consequence of this election result – and it matters quite as much for Europe and beyond as for Britain – is that it is certain that there will be a referendum on EU membership. That will split the Tory party and possibly rejuvenate the Labour Party (it’s notable that they are strongest in cosmopolitan London where UKIP are weakest) as a pro-EU party. It will exacerbate the division between England and Scotland. It’s not impossible to imagine a complete re-alignment of British politics via the EU Referendum, rather as has happened in Scotland in the wake of the independence referendum. At the very least, it will make for some new alliances: the City and big business and Labour and the SNP and centrist Tories versus UKIP, Tory Eurosceptics, Irish Unionists and the far Left. We are in for interesting and unpredictable times.

Vox Populi

In 1959 the poet and playwright Bertolt Brecht published one of his most famous poems, Die Lösung (The Solution), which contained these lines:

…. the people
Had forfeited the confidence of the government
And could win it back only
By redoubled efforts. Would it not be easier
In that case for the government
To dissolve the people
And elect another?

It was a biting satire of the Communist repression of the 1953 workers’ uprising in East Germany and indeed was written at that time, and only published later, and then in West Germany, so subversive was it seen to be by the communist regime in the east. Since then, it has been taken up as an anti-elitist text, expressing how the political class see those who they represent as a problem.

I have been thinking about this because it seems to chime with much political sentiment in Britain at the moment. Last night the leaders of the ‘main parties’ (increasingly, a misnomer) were questioned by an audience of the electorate and the general verdict was that the audience ‘won’ by savaging the politicians. Here, supposedly, were the salt-of-the-earth ordinary folk sticking it to an out of touch elite.

My own view is completely different. It seemed to me that the audience engaged in the laziest and easiest kind of debate. Every politician is a liar and not to be trusted – but no one questions the audience as to what they want, other than a representative democracy. Any fact or figure can be thrown in by the audience, no matter how incorrect – and it is ‘elitist’ to challenge it. People who would rip into politicians for ‘gaffes’ complain when the politicians offer carefully calibrated answers to avoid gaffes. For the audience, every issue is easy, but they would not last five minutes if they themselves had to navigate the complexity of almost every issue. If the politicians talk about general principles, the audience denounce them as being fact-free; if they talk about facts the audience denounce them as lacking principles.

I had a similar reaction when I watched a Channel 4 debate between young voters and politicians this week. At one point, one of the audience got huge cheers for saying that she and her generation had no idea what the different parties stood for. But every day the media reports on the parties and their policies, and politicians bend over backwards to find new ways of engaging with people. Doesn’t she have some responsibility to engage in turn?

Heaven forbid that we should return to the political deference of bygone eras, when politicians were not challenged and the assumption was that the great and the good knew what was right for the rest of us. But now that situation has been inverted, and any ignorance, any cynicism, any sneer against politicians is taken as reasonable. The easiest and cheapest applause comes to the person who says that ‘they are all the same’.

But in most constituencies there are candidates ranging from Greens to UKIP, and in many constituencies candidates from the harder left to the harder right. They are not all the same, they stand for different things. It’s true that the electoral system in Britain makes it hard for smaller parties to gain representation, but even then the share of the vote matters in giving parties a legitimate voice. For example, for years the Liberal Party (as was) secured only a handful of seats but it had a certain legitimacy because of its vote share. Voting always makes a difference because legitimacy comes from the franchise, not the turn out, and abstaining has exactly as much effect as voting. But I think this is anyway just a sideshow – people point to the idea that their vote doesn’t count as an excuse for opting out of serious political engagement.

The lazy, easy sneer at politicians is meat and blood to more populist, supposedly anti-politics, parties such as, in the UK, UKIP. Yet as soon as politicians from such parties are elected, the contradictions are made clear. For example, UKIP MEPs take massive salaries and expenses from the EU even as they denounce it, and rarely turn up to vote. It’s actually the ultimate example of self-serving politicians but is greeted as if it were the opposite. Relatedly, on my local council, the UKIP councillors elected found it impossible to actually do their job because they couldn’t understand the procedures and legal framework of the council’s business. Caught up in slogans about ‘LibLieCon’ and the ‘Liberal Elite’, when it came to the actual business of governing and making practical choices – moving, so to speak, from being audience to being players – they just couldn’t cope. Within six months of being elected they had resigned. That isn’t an anti-UKIP point, by the way, just an illustration of the disconnect between anti-politics sentiment, of whatever persuasion, and politics itself.

I’ll finish with a telling quote, also usually attributed to Bertolt Brecht, although the attribution is not clear:

“The worst illiterate is the political illiterate, he doesn’t hear, doesn’t speak, nor participates in the political events. He doesn’t know the cost of life, the price of the bean, of the fish, of the flour, of the rent, of the shoes and of the medicine, all depends on political decisions. The political illiterate is so stupid that he is proud and swells his chest saying that he hates politics. The imbecile doesn’t know that, from his political ignorance is born the prostitute, the abandoned child, and the worst thieves of all, the bad politician, corrupted and flunky of the national and multinational companies.”