Oisín Mac Giollamóir explores the complexity of how the Eurozone crisis affects particular states
If the working class has no country it is for one reason: because capital has no country. But of course capital is often national. The emergence of the nation state and capitalism are contemporaneous. As capitalism emerged so did the nation state. As various historical class relations are dissolved into the capital/labour relation, the notion of the nation’s common interest emerges. But what happens when the nation becomes a constraint on capital accumulation? It expands.
Over the last 60ish years, through the emergence of the EU, Europe has seen the emergence of an integrated capitalist system. However, a major limit of this integration is that the national myth, the idea of a common interest between capital and labour, has not developed on a European level.
The working classes of Europe identify with their national capitals not with European capital. But equally the power that the working class can operate through the nation state doesn’t operate in the same way on a European level.
A part of this problem is simply that a European working class doesn’t exist – the working class of Europe is divided primarily by language resulting in migration between countries being far less than migration within countries.
Further, taxation and the welfare state still exist almost exclusively on the national level. The financing of the ‘solutions’ to capitalisms worst deprivations occurs primarily on a national level. Additionally, the aspects of capitalism that are needed by the capitalist economy but cannot self-finance are financed largely on a national level, be it universal education, the nuclear industry or in recent years the banks.
The result of this is that despite the transnational nature of the current Eurozone crisis, it can only be understood by paying attention to the interrelation of nation states within the Eurozone.
At the moment the crisis of European capital (the flipside of the debt crisis in the European periphery is a crisis for the creditors in the European core) is being dealt with in a national way. The debt burden in the periphery is being transferred from creditors in the core to the taxpayers (i.e. workers) in the periphery in the form of the sovereign assumption of debt. The debt crisis, now sovereign, is then transferred onto the workers of the periphery in the form of austerity.
Three key questions therefore arise. Firstly, can this fix resolve the crisis? Secondly, why is this fix being pursued? Thirdly, what scope for resistance is there in the periphery.
Firstly, this fix almost certainly cannot resolve the crisis. The burden of debt is simply too large. Taxpayers/workers in the periphery cannot finance it. Either an alternative solution is developed or defaults, and with that the demise of the Eurozone, will follow.
Why is this fix being pursued? Briefly, it’s being pursued because in Europe it is the easiest solution. No institutional apparatus exists to solve the problem on a European level and no political will exists to develop such an apparatus. If the German state can get German investors bailed out by Greek taxpayers it will.
What scope is there for resistance? A lot. While it is unlikely that the working class in the periphery will be able to force their states to default on their debt, it may be possible for them to force their states to say on a European level that it is not politically feasible to pursue the planned austerity programs in their states. By doing so this might force at the very least an expansionary monetary policy bringing about a real depreciation of the debt across Europe and an internal rebalancing of price level between the periphery and the core.
The problem here is that the question of how the working class of the periphery can force their states to say the austerity programs are not feasible is an open question.