Britain and the Common Market
After a lapse of four years Britain has again applied to join the Common Market. Last time it was a Conservative government. This time it is Labour, showing that capitalism imposes similar programmes on its political parties in power. The line-up for and against Britain’s entry draws support from both parties as it did in 1962. In fact Labour rebels have taken a stronger stand on this issue than on any of the other controversial measures of the present government.
On May 2 Harold Wilson declared in a House of Commons statement:
“This is an historic decision which could determine the future of Britain, Europe and the World for decades to come.”
Leading Labour opponent of Britain’s entry, Emmanuel Shinwell, said in the same debate:
“In view of the unqualified approval by three members of the opposition benches, can I assure the Prime Minister that with all the force of which I am capable even by myself, I will give him the most relentless and ruthless opposition.”
In view of the claims of both sides it is worth examining the question in relation to working class interests.
At the end of the nineteenth century world trade and industry was dominated by the states of Western Europe with large empires under their control. The world wars of 1914-18 and 1939-45, which were the outcome of the struggles between these powers for supremacy, resulted in their decline and in the emergence of America and Russia as the leading industrial and military powers. A struggle developed between them with Eastern Europe dominated by Russia and Western Europe by America. They stationed their armed forces in these areas and geared the economies of these territories to their own.
In Western Europe America consolidated its military power through NATO. The economy was revitalised by American government funds through the Marshall Plan with the condition that the countries of Europe must band together and agree on a joint recovery programme. Thus America, in meeting the challenge of Russian state capitalism, was forced to finance the revival of industrial competitors.
Expansion in world trade soon allowed production to exceed pre-war levels and one country after another had its “economic miracle”. European capitalists had a large pool of unemployed displaced workers at their command along with the latest plant and equipment. Britain, on the other hand, survived with much of its industry intact and its order books were filled for years ahead to supply the backlog of demand from its traditional markets. Its workers were in a relatively strong position as a result and were able to enforce demands for pay increases and to maintain working practices which became more and more of a hindrance to efficient production as manufacturing techniques developed.
In spite of early enthusiastic pronouncements by Churchill and Attlee on European unity no practical initiative to this end was taken by Britain. The first move to set up what is now known as the Common Market was the establishment in 1951 of the European Coal and Steel Community (ECSC) by Belgium, France, Holland, West Germany, Italy and Luxembourg. Its aim was to regulate the production and marketing of coal, iron and steel in this area. The ECSC was soon faced with problems in Belgium, with its uncompetitive coal industry. Mines were closed and thousands of miners laid off. Mineowners received compensation from the ECSC; miners got compensation from the dole and industrial retraining for other work. The employer-employee relationship remained as before.
The difficulties facing the ECSC have continued. With increasing iron and steel production and with mergers and streamlining to meet world competition, profit margins have dropped. The coal industry has its troubles with mine closures recently in the Ruhr. In Britain the coal and steel industries face similar problems and membership of the ECSC would only give them access to a market which is already oversupplied—and this would affect the present ECSC members. Whichever of the partners gains from entry the position of the workers, the insecurity of living on a wage or salary, will remain.
In 1957 the Rome Treaty setting up the European Economic Community (EEC) and the European Atomic Energy Community (Euratom) was signed by the same six states. The EEC, or Common Market, aimed at
“… the creation of a customs union with a common external tariff and by the abolition of internal tariff duties and quotas, the establishment of a common agricultural policy, the free movement of persons, services and capital; and a harmonised transport system” (Westminster Bank, The Common Market and the United Kingdom).
British capitalism, with the bulk of its trade located in the Commonwealth and Sterling Area, took little interest in the Common Market. The European Free Trade Association (EFTA) was set up by Britain, Denmark, Norway, Sweden, Switzerland, Austria and Portugal in 1960. Its main aim was the progressive reduction of customs duties on industrial goods. There was no provision for common external tariffs nor a commitment to political unification, which made the idea more acceptable to the British government. By 1961 trading conditions were changing in the Commonwealth and Sterling Area, making it harder for British goods to be sold there. Countries such as America and Japan were taking a growing part of their trade. The Common Market, with the prospect of a home market of 250 million people including Britain and some of its EFTA partners, became an attractive proposition. The first application came at a time when EEC itself was making heavy weather of formulating a common agricultural policy. Britain’s conditions, on agriculture, Commonwealth trade and concern for EFTA, proved too much and negotiations broke down in January 1963.
Since then there has been a change of government and Labour soon found themselves as impotent as the Conservatives to deal with the economic ills of British capitalism. Meanwhile the trends in world trade which had made application desirable earlier continued. Britain’s share of Commonwealth trade continued to decline. Trade with Europe, on the other hand, increased. With EFTA, where customs tariffs were lowered, it increased 70 per cent since 1960. In the EEC where external tariffs were going up it increased by 100 per cent for the same period (Financial Times, 2 March 1967). Hence the new application.
The Common Market has come about as a result of the pressures of world capitalism. It is an effort to give Western Europe the political and economic structure to compete commercially and militarily with America and Russia. Britain’s desire to join is not motivated by some newly discovered principles of internationalism by Wilson and his government. Rather it appears to offer the best hopes of a solution to some of the problems of British capitalism. The Confederation of British Industry has made it quite clear that it favours entry: As reported by The Times they said:
“This is the move that industry has been waiting for and the CBI have been urging the government to make. The CBI’s recent report, based on a year’s analysis, concluded that on balance entry would be to the benefit of British industry” (3 May 1967).
The interests of the working class are not served by debating the merits of being in or out of the Common Market. The Common Market amounts to the re-arrangement of tariff barriers amongst member states. The alternatives posed by opponents of Britain’s entry vary from keeping present arrangements to forming a North Atlantic Free Trade Area and to greater trade with East Europe. All of these proposals leave capitalism intact. Production for sale and profit would continue; the working class would still exist; and the social problems of the system would still be there.
JEF