Conservative Party splits on currency union

Chris Burford cburford at gn.apc.org
Fri Oct 11 01:38:01 MDT 1996


British Conservative Party Splits on  Currency Union.

The British Conservative Party at its annual conference
is loudly trying not to tear itself apart over European
currency union. It could lead to one of those great historic
splits in which this hegemonic party of British capitalism is
out of office for a generation. Both sides are preparing for
election defeat in 1996 and getting alternative sources of funding
for the nucleus of separate parties. The pro-European
Tory Reform Group has just moved into new enhanced premises.

The issue of currency union has caused splits down the middle of
traditional bourgeois parties in a number of European countries.

How to analyse this sort of split from a marxist point of view?

One of the problems is precisely that Business does not speak
with a  unified voice. That is the problem for analysis
and perhaps a clue to the solution.

It seems to me that perhaps these moves towards currency union
are a little *analogous* to the moves from protectionism to
free trade in the nineteenth century.  Protectionism is about fairly
rigid border controls and different tax rates on commodities, thereby
controlling their free flow over the borders.

Currency unions however such are being fiercely debated in Europe
are more flexible arrangements where the total exchange value of
a country or group of countries expressed in money terms is the
yardstick against which manufacturers adjust their costs and their
markets.

Modern highly sophisticated means of currency exchange make it much
easier to convert money and to do calculations in one currency or
another. In effect several currencies can now run parallel.
The City of London can run with Britain in the currency union or
outside, although I think it is pretty clear it considers it could
defend its interests as the leading centre of finance capital in our
time zone, better with Britain in the single European currency.

In some ways this is an exercise in practical set theory. But the
tough question about currency union is what is the base currency
which denotes the *relatively* stable sharing of similar standard of
production, pay of workers, conditions for raising of capital etc.


In this there is an *analogy* I suggest, with the conflicts Engels
described in the passage from protectionism to free trade which
repeatedly pitted one group of capitalists and their political factions,
against another group of capitalists and factions.

I would appreciate comments, criticisms, and other ideas about how
to analyse these conflicts over the single European currency.

Chris


___________________________________


>From


                      Preface by Frederick Engels
                 for the 1888 English edition pamphlet


                            Karl Marx's
                     ON THE QUESTION OF FREE TRADE



Protection beings_ a means of artificially manufacturing manufacturers,
may, therefore, appear useful not only to an incompletely developed
capitalist class still struggling with feudalism; it may also give a
life to the rising capitalist class of a country which, like America,
has never known feudalism, but which has arrived at that stage of
development where the passage from agriculture to manufactures becomes a
necessity.  America, placed in that situation, decided in favor of
But no country will again be able to pass from Protection to Free Trade
at a time when all, or nearly all, branches of its manufactures can defy
foreign competition in the open market.  The necessity of the change
will come long before such a happy state may even be hoped for.  That
necessity will make itself evident in different trades at different
times; and from the conflicting interests of these trades, the most
edifying squabbles, lobby intrigues, and parliamentary conspiracies will
arise.


<>


Another point.  Improvements in the methods of production nowadays
follow each other so rapidly, and change the character of entire
branches of industry so suddenly and so completely, that what may have
been yesterday a fairly balanced protective tariff is no longer so
today.

<>


But no country will again be able to pass from Protection to Free Trade
at a time when all, or nearly all, branches of its manufactures can defy
foreign competition in the open market.  The necessity of the change
will come long before such a happy state may even be hoped for.  That
necessity will make itself evident in different trades at different
times; and from the conflicting interests of these trades, the most
edifying squabbles, lobby intrigues, and parliamentary conspiracies will
arise.

<>



Thus the passage from a home to an export trade becomes a question of
life and death for the industries concerned.  But they are met by the
established rights, the vested interests of others who as yet find
protection either safer or more profitable than Free Trade.  Then ensues
a long and obstinate fight between Free Traders and Protectionists; a
fight where, on both sides, the leadership soon passes out of the hands
of the people directly interested, into those of professional
politicians, the wire-pullers of the traditional political parties,
whose interest is not a settlement of the question, but its being kept
open forever; and the result of an immense loss of time, energy, and
money is a series of compromises favoring now one, then the other side,
and drifting slowly though not majestically in the direction of Free
Trade --

<>



     --- from list marxism at lists.village.virginia.edu ---




More information about the Marxism mailing list