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Reject the Deal

The Withdrawal Agreement's Crimes Against Democracy: Democratic Resurgence Requires “No Deal”

Danny Nicol

3 January 2019

Legal analysis of the Withdrawal Agreement shows that, like the EU Treaties, it is designed to lock in neoliberal policies and outlaw socialist alternatives. This would prevent the return to true democratic contestation that Britain so desperately needs.

This article is part of a debate. For the case for the deal, click here.

Historically, the cleavage between Left and Right has been fundamental to democracy. Having parties expressing this ideological difference allows voters to choose between governments that uphold the status quo or which, to greater or lesser extents, favour social change. Since the defeat of the organised Left in the late 1980s, this difference between Left and Right has steadily collapsed in European politics, as major parties converged around a centre-right, neoliberal agenda. The European Union has both expressed this political tendency and entrenched it. As Labour Party leaders had feared as early as the 1940s, European integration has locked in rules that increasingly discriminate against traditional Labour policies and in favour of traditional Conservative ones (see Analysis #7 - Why Does the British Left Love the EU?). The UK-EU Withdrawal Agreement is no different in this regard: it binds the British body politic in favour of capitalistic, conservative policies. It therefore represents an impediment to the restoration of meaningful democratic politics in Britain, which is craved by the vast majority of British citizens, regardless of how they voted in the referendum.

 

This hollowing out of democracy played a significant part in the “Leave” vote in the EU referendum of 2016.  As Costas Lapavitsas convincingly observes:

 

The plebeian classes of Europe were right to perceive the hollowing out of democracy as a loss of sovereignty, for democracy is an integral part of popular sovereignty and extends far beyond the mere ability to vote periodically. It naturally translates into the ability of the poor, the workers, the self-employed and others to have influence over their conditions of life… As [democracy’s] mechanisms and institutions were hollowed out in Europe during the last few decades, an unprecedented sense of powerless came to prevail amongst the poor. …[T]he decline of democracy and the loss of popular sovereignty in Europe reflect a historic shift in favour of capital and against labour.[1]

 

Homogenous parties

 

Lapavitsas’ insights apply as much to Britain as to continental Europe. National sovereignty and democracy are indeed inextricably connected. For decades the ruling elite has deployed supranationalism to fashion a world in which the power of private enterprise has been placed above democratic contestation. The free choice of economic policies – on such matters as state support to British industry and the choice between market solutions and public sector monopoly – has increasingly been made legally impermissible.  

 

Within this post-democratic world elections serve as window-dressing. Voters may choose a party of any political hue, provided that once in office it pursues only policies compatible with EU law. Manifestoes and mandates therefore count for nothing. The strength of the supranational apparatus is such that parties of the Left are easily cowed into conformity, especially when they mistakenly assume that EU or Eurozone membership is compatible with their political aims, as evidenced by Syriza in Greece.

 

Trapped in the backstop

 

The Withdrawal Agreement represents not the elimination of this anti-democratic trend but its continuation by other means. The Agreement has become infamous because of its backstop: it may be superseded by another deal only if the EU agrees on the replacement. But the full anti-democratic significance of the Withdrawal Agreement can only be properly appreciated by examining its substantive provisions. These take away national sovereignty over aspects of policy-making which are seminal to the democratic competition between Left and Right in British politics:

 

  • As regards state aid to industry, the Withdrawal Agreement fulfils Theresa May’s commitment to “make an upfront commitment to maintain a common rulebook on State aids’ with the EU (Articles 7-25 of Annex 4). As Lapavitsas has argued, any radical Labour industrial strategy would fall foul of these restrictions, which are designed to prevent governments from distorting the single market (see Proposal #2 - Quit the Single Market: How the EU Throttles State Aid and Industrial Policy).  Defenders of the EU state aid regime argue that it does not preclude infrastructure spending.  It does however rule out a more radical restructuring of the British economy in favour of manufacturing and other high-export potential sectors, since any government committed to such a policy would need to distort the market in favour of new “national champions” and in the interests of British products and workers.  To do so is a legitimate policy objective which should not be ruled out in a democracy. Some Labour figures are belatedly waking up to this threat: opposition Leader Jeremy Corbyn has said “I think the state aid rules do need to be looked at again, because quite clearly, if you want to regenerate an economy, as we would want to do in government, then I don’t want to be told by somebody else that we can’t use state aid in order to be able to develop industry in this country”[2].

 

  • As regards nationalisation, the Withdrawal Agreement provides that state interventions must not distort markets and undermine trade liberalism, that the UK shall not enact any measures contrary to the EU competition rules with regard to public undertakings, and that the interpretation of this obligation shall be driven by all relevant acts adopted by the EU institutions (Articles 16-21 of Annex 4). These acts include the liberalisation directives on the “public utilities” - postal services, gas, electricity, telecommunications and rail - which compel Britain to have market regimes in these sectors. The Agreement therefore outlaws the kind of nationalisations of public utilities implemented by the 1945 Labour Government. By the same token the competition provisions would also prohibit the creation of new public monopolies in sectors traditionally dominated by private enterprise such as banking and construction. In democracies, the extent of public and private ownership within the state should not be fixed in perpetuity by supranational agreements but should remain be a matter of democratic contestation.

 

  • As regards free movement of goods, the Withdrawal Agreement subjects Britain to the full gamut of EU provisions (Article 41(2)). This imports vast swathes of law into Britain cocooned from the democratic scrutiny of Parliament. The free movement of goods is not apolitical. Its scope is vast: it covers not only border measures but internal measures, even those which do not actually discriminate against imports from EU member states. Indeed, it covers all national rules which are of capable of indirectly, potentially hindering trade with the EU.[3] It has been held to outlaw anything from a governmental “Buy British” campaign to a failure to repress workers who try blocking imports. Any such rules are subjected to an intrusive test of proportionality: whether the same policy objective could have been accomplished by means less disruptive to free movement. Free movement is thereby privileged over social concerns. At best, interventionist measures would be held up awaiting adjudication at the behest of corporations, as was the case with the Scottish minimum alcohol pricing rules which were delayed for two and a half years to the detriment of the Scottish people. As with state aid and public ownership, the regime is weighted in favour of free-market solutions, regardless of how the country votes in democratic elections.

 

Rise of the unelected

 

Part of neoliberal globalisation’s war against democracy has been the empowerment of unelected, unaccountable bodies to which politicians “hive off” their decision-making. A democratic Brexit should seek to eliminate decision-making by unaccountable bodies. But instead the Withdrawal Agreement brings about their proliferation.

 

In this regard Theresa May has maintained that, under the Withdrawal Agreement, Britain will leave the jurisdiction of the European Court of Justice. To be sure, the ECJ routinely usurps the role of democratically elected parliaments, as shown by its seminal anti-worker Viking and Laval decisions (see Analysis #13 - The Chimera of Workers' Rights in the EU). Yet the Withdrawal Agreement stipulates that wherever it uses EU law or concepts (which it does pervasively) these must be interpreted in conformity with the ECJ’s case law (Article 4(4)). For instance one short sentence regarding the free movement of goods in Article 41(2) imports a welter of Court of Justice principles laid down in thousands of decided cases.  The ECJ therefore remains immensely and durably powerful.

 

Moreover, the Agreement creates a nightmarish new appointed body – the Joint Committee – which will resolve disagreements between the UK and EU over the Withdrawal Agreement’s terms. In so doing, the Joint Committee shall have the power to make decisions which are binding on the United Kingdom (Article 166). So much for the sovereignty of Parliament. Astonishingly, the Joint Committee’s decisions shall have the same status as the Withdrawal Agreement itself (Article 166(2)). Furthermore, its meetings will be confidential, so it will essentially legislate in secret (Article 10(1) of Annex 9). The Joint Committee would establish Arbitration Panels, each of five “independent” persons, to adjudicate disputes, and these Panels will have the right to ask the ECJ to give rulings (Articles 171-174). The precedence of unelected, unaccountable bodies over our elected, accountable Parliament therefore continues unabated.

 

“No Deal” democracy

 

The Withdrawal Agreement’s attacks on sovereignty are profoundly anti-democratic in nature. By elevating neoliberalism above democracy, the Withdrawal Agreement, like the EU Treaties, binds government and parliament not on peripheral matters but on issues fundamental to the Left-Right divide in British politics. It favours the policies of the Right, rules out the policies of the Left, and thereby ties a noose around the neck of British democracy.  

 

In view of this, the British Left needs to reconsider its disdain for a “No Deal” Brexit in which Britain and the EU default to the terms of the World Trade Agreement. The original objections to “No Deal” are wearing thin as fears of economic Armageddon and war in Northern Ireland become increasingly far-fetched. Only “No Deal” can foster the rebirth of British democracy as a genuine, constantly recurring choice between Left and Right, a democratic revival which the British people desperately need.

 

References

[1] Costas Lapavistas, The Left Case Against the EU (Cambridge: Polity, 2018) p. 5.

[2] “Corbyn: Brexit would go ahead even if Labour won snap election”, The Guardian, 21 December 2018.

[3] Case 8/74 Procureur du Roi v. Dassonville [1974] ECR 837.

 

 

About the author

Danny Nicol is Professor of Public Law at the University of Westminster and author of The Constitutional Protection of Capitalism (Oxford: Hart).

This work represents the views of the authors only. It is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.