Calming The Waters

This is a response posted on the Irish Times website to an article by John O’Hagan, Professor of Economics at Trinity College, Dublin, with the unusual title Referendum straitjacket on State over EU treaty changes, which conjures the image of a State wriggling to free itself of its own laws. Leviathan as Houdini, or perhaps vice-versa. But then, anything is possible in the fairy tale land of ‘international economic law literature’, which the author cites to support his contention that in a world of countries subject to the pressures of financial markets, representative democracy –‘a dream so powerful we were quite literally willing to bomb it into people’s heads’, as memorably described by Jerome Roos here– is where sovereignty should only ever be at.

Whose waters, precisely, have been calmed on account of the most recent actions? What the ECB and the German constitutional court have achieved, by helping to institutionalise the austerity conditionalities of the EFSF and the ESM, is one more mighty turn of the screw  against the working population of Europe, in favour of the banking sector and the owners of capital. It translates into a political programme of further wage depression, eroded working conditions, and, as the former Goldman Sachs executive, now unelected head of the ECB Mario Draghi has celebrated, the end of the European social model.

The concept of economic sovereignty is not ‘extraordinary difficult’, nor does it require hitting the ‘international economic law literature’ books for a more ‘nuanced’ interpretation, as the author suggests, in order for people to understand it.

The sovereign -coming from the Latin superanus- is whoever it is that exercises authority over everyone else. In economic terms, sovereignty does not currently reside in the peoples of Europe (nor, for that matter, with their parliaments, which have abandoned fiscal decision-making powers) but rather in finance capital – as the author himself puts very nicely indeed, ‘every nation is subject to the pressures of financial markets’ – and its various personifications, whether Mario Draghi and his colleagues at the ECB, top executives at Goldman Sachs or Deutsche Bank, or even those political representatives who see every demand from finance capital as a self-evident necessity and renege on their electoral promises in fulfilling those demands.

Whilst the author may be concerned at the capacity of private individuals to influence political decision-making in the course of a referendum campaign in Ireland, he seems very sanguine indeed about the concentration of immense political power in the hands of a few unelected individuals, and the capacity of finance capital to act through them.


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