Gordon Brown (The key lesson of Brexit is that globalisation must work for all of Britain, 29 June) writes: “The commission I propose should examine the most controversial issue arising from the free movement of capital, labour, goods and services – namely migration.” Migration might be controversial but it follows from the free movement of capital across national borders. Under the Bretton Woods-governed international economic order, national economies were spared, for a time, the free flow of speculative financial flows. The freedom to move financial capital in and out of national economies creates instability of currencies, volatility in commodity prices, and short-term profit taking rather than sustainable long-term investment. In the US Treasury Harry Dexter White argued that capital flows were designed to evade “new taxes or burdens of social legislation”. Keynes, for the UK Treasury, wrote: “There is no country which can, in future, safely allow the flight of funds for political reasons or to evade domestic taxation or in anticipation of the owner turning refugee.” Is Mr Brown prepared to assert the rights of nation states to control capital flows?
Sam Whimster
Global Policy Institute
• Gordon Brown has it right – up to a point. The issue isn’t just about the EU or even about national politics. It’s about globalisation. But what do we do about it? More committees? More “in-depth scrutiny”? More thought about the role of Scotland (and presumably other sub-national as well as national jurisdictions)? We can’t just “take back control” because control is no longer in the hands of national politicians or even European-level policymaking. The problem is much broader. It requires a global approach – a fundamental shift away from the austerian, neoliberal, free marketeering kind of globalisation that became embedded in national life in both developed and developing countries, in the EU and in the fragmented attempts at “global governance” that took root in the late 20th century. It needs a revised and updated version of the mixed economy and welfare state: a revived social contract that supports growth, provides efficient public goods, enables social mobility for ordinary people, limits inequality, and protects the most vulnerable.
This needs to be pursued not only at domestic level, or even at EU level, though the revival of the notion of a “social Europe” would be a start. It requires new forms of international cooperation on such matters as a financial transactions tax, a wealth tax of the kind proposed by Thomas Piketty, the increased regulation of markets and, most of all, an ideological shift away from the kind of “efficient markets” theory that has been dominant in both academic economics and economic policymaking in recent decades.
We need a new global social contract. Brexit, unfortunately, just fragments the process and makes the problem worse.
Philip Cerny
Professor emeritus of politics and global affairs, University of Manchester and Rutgers University
• Gordon Brown is wrong in thinking that economic globalisation, which has made life so precarious and insecure for the majority in most countries, can ever be “made to work for all”. Its European manifestation of open borders to the free movement of people, goods, capital and services has ensured that working people across the EU have been forced to increasingly compete with each other to their own personal detriment, but to the benefit of big business and finance. The Brexit vote showed that those disadvantaged by this process grasp this in terms of the free movement of people at least. It is hardly surprising that when given an opportunity not available in a general election, where all major parties supported open EU borders, that they leaped at the chance of using the referendum to say no.
Now that the renegotiation era is dawning it is utterly crucial that we in the UK call for controls on damaging open borders to be the key condition for our future relationship with the EU. This will also resonate with the concerns of the populations of the other 27 EU countries, all of whom want to take back control of their economies to enable their local communities to flourish. Most crucially this will help reduce the growing sense of economic insecurity and impotence caused by globalisation’s open borders emphasis. It is this that has acted as such an ominous 1930s-style recruiting sergeant for Europe’s extreme right.
Colin Hines
Twickenham, Middlesex
• Gordon Brown’s plan for ensuring that global trade is fair shows yet again what a tragedy for British politics it was not to have a Lib-Lab pact for electoral reform in 2010 in place of the Tory coup which has resulted in economic and political self-destruction.
Margaret Phelps
Penarth, Vale of Glamorgan
• A key plank in the leave case seemed to be that there were far more opportunities for trade outside the EU than inside. Could we please hear more about the plans for negotiations with Canada, China, India, and the rest of the world, and less about how to scavenge a few scraps from the EU table.
Vivian Cook
Colchester, Essex
• Giles Fraser (Labour is partly to blame for the racists’ capture of the EU debate, 1 July) is so well-meaning, and so mistaken. The idea that capitalism can be tamed by one country the size of Britain is a fantasy. The EU was one of our few opportunities to tame the beast; Brexit is only coherent as a political project if you are a rightwing deregulator. And how does Giles think Africa is going to generate the jobs for its projected quadrupling of its population this century without massive investment by international capital? There is so much that can be done to create jobs and hope for people in deprived communities, within the framework of international capitalism, by investing in the transition to a green economy: see the New Climate Economy reports. Abandoning globalisation for protectionism would undermine action on climate change; regional blocs would compete with each other, and focus on energy security by prioritising access to fossil fuel reserves.
Or put another way, in today’s world “loving your neighbour” has to mean your neighbour on the other side of the world, too. Giles, your theology is too small.
Huw Brodie
Cardiff
• Felicity Lawrence (Report, 1 July) asks what are the options before us in a globalising world and how to respond to migration. Congratulations to her for setting out the progressive answer: a strong social framework that stops the low-wage, long-hours, no-regulation culture that predominates in so much of our labour market and others across Europe. That requires a break from the naive, Panglossian view of globalisation promoted by New Labour, on which “old Labour” took its revenge in the referendum.
In contrast, Giles Fraser peddles the fantasy, that progressives can go against the realities of modern life – where the economy and culture have escaped the boundaries of the nation state – and challenge “the villains” of “advanced capitalism” within one country. As Lawrence shows, the left must not kid itself that there is a progressive bolthole for English nationalism. There isn’t.
The answer – even more so now – is to propose an alternative model of globalisation, explicitly recognising its downsides. Gordon Brown’s call “to tame globalisation” is a welcome, if belated, shift in thinking. Progressives now need to put policy flesh on those bones, working as closely as we can in the process with our European neighbours.
Jon Bloomfield
Birmingham
