The British pound hit a 31-year low against the U.S. dollar on Monday. After $2.4 trillion was wiped off the stock markets, Goldman Sachs had to revise its growth predictions for Britain from 1.7 per cent to 0.5 per cent. Leading economists have compared the market turmoil following the Brexit vote to the collapse of Wall Street giant Lehman Brothers in September 2008.
It is not yet clear how German Chancellor Angela Merkel will punish the British for leaving the EU, but in the meantime the European elites are letting the markets speak for themselves. This is nothing new. It is a replay of what happened ahead of the “oxi” vote in Greece nearly a year ago, when a majority of Greeks voted in a referendum to reject bailout conditions from the country’s European creditors. Money supplies were cut and capital fled.
As Britain is not part of the Eurozone, the means are different, but the message is the same: If you vote the wrong way, we will punish you. The last days are just the beginning of a new cycle in the economic crisis that has engulfed Britain for the last eight years.
Since coming to government in 2010, the Conservative Party has mangled its way through one political crisis after another: the tuition fee revolt in 2010, the phone hacking scandal, several ministerial resignations, and most recently the investigation around electoral fraud during the 2015 general elections. The EU referendum was a cynical attempt to let the public decide on which wing of the Tories was to continue to govern Britain in the future.
This time Prime minister David Cameron did not get away with a bloody nose; he was fatally wounded. With a new Scottish independence referendum on the horizon, a possible border poll in Northern Ireland, and Cameron refusing to trigger Article 50 of the Lisbon Treaty, the crisis in the Conservative Party has warped into a full-blown regime crisis.
This regime crisis is proof that Britain’s fate is tied up with Europe and the European Union, whether Brits like it or not. The very same dynamics of ungovernability that have shaken Portugal, Greece, and Spain to their foundation are now unfolding in Britain. The Brexit vote is simply the lightning rod for all those contradictions to surface in the most brutal way in the shortest period of time.
The fact that Labour Party leader Jeremy Corbyn staved off a coup attempt (at least for now) after 12 shadow ministers of the Parliamentary Labour Party resigned, and more than 10,000 people demonstrated outside of the House of Commons in his defence highlights the extent to which Westminster politics has Europeanized in the wake of the crisis.
The worrying number of racist hate crimes since the Brexit vote — with Turkish and Spanish restaurant windows smashed, and Black and Muslim school children told to “go back to where they came from” — represent a continuation of the kind of politics that has dominated Britain since the crisis.
In 2009, oil refinery workers went on strike demanding “British jobs for British workers.” In 2010, the Euro-fascist British National Party won more than 2 million votes in the general elections. There have been countless Islamophobic, far-right demonstrations by the English Defence League, while during the 2015 general elections all parties were singing off the same hymn sheet demanding immigration controls and cuts in benefits for EU migrants.
While the liberal commentariat has been quick to blame “chavs” and the Leave camp for the rise in racism, it is worth remembering that Cameron himself has spoken of “swarms” of refugees at Britain’s gates and emphasized that EU membership facilitated coordination against the Muslim terrorist threat. Thus, the Remain camp that cloaked itself in the Union Jack is as guilty as anyone for the open racism in recent days.
To invoke Mao Zedong’s “Everything under heaven is in utter chaos; the situation is excellent,” as some on the left have done, misses the point. The social movements and the wider left played little role in shaping the EU referendum and are unlikely to move the masses of people to an anti-neoliberal, pro-migrant position in the coming weeks.
The ruling elites might not be able to rule as they have done before, but there does not seem to be any social coalition able to replace them and their disastrous course, which is responsible for the mess that Britain finds itself in.
Mark Bergfeld is an activist and researcher currently working on his PhD at Queen Mary University of London. He was one of the spokespeople for the U.K. student movement and anti-austerity movement from 2010 to 2012. This article is an abbreviated version of the talk he gave for Tadamon! Montreal on June 27, 2016.