REMAIN AND REFORM The Portuguese experience of being ‘in and against’ the European Union by Hilary Wainwright with an introduction by Clive Lewis CONFLICT AND CIVIL SOCIETY RESEARCH UNIT Hilary Wainwright is a Fellow of the Transnational Institute, an Honorary Associate at the Institute of Development Studies and founder and co-editor of Red Pepper magazine. Her latest book is A New Politics From the Left (Polity, 2018). ACKNOWLEDGMENTS With many thanks to Alvaro Vasconcelos, Pedro Bacelar, Joana Ramiro, Catarina Príncipe, Mary Kaldor, Luke Cooper, Tom Walker, John Palmer, Barbara Harris White, Gonçalo Marcelo, Leonardo Costa, Neil Swannick, Michael Chessum, the Rosa Luxemburg Foundation and the Transnational Institute. Photos: Pedro Ribeiro Simões. SPONSORS ANOTHER EUROPE IS EUROPE POSSIBLE for the many 2 INTRODUCTION “Portuguese socialists were able to prove that austerity measures had been broadly economically damaging as well as ideologically driven. In doing so the country proved both an inspiration to others and a test bed for a new relationship between individual nations and the institutions of the EU.” CLIVE LEWIS MP “In and against” is such a powerful idea: one vision, whether on public ownership, outsourcing can be loyal, even faithful to the project, while or state aid, are either misunderstood, have been trenchantly critical of its shortcomings. It’s how superseded or are flexible. It will be enlightening, many of us felt about the Labour Party for the too, to any of us who have been conditioned to first part of this century, and the change in that understand negotiations with the EU as a test institution is testament to how creative and of strength, and a tedious one, in which 27 will transformative this position can be. always be stronger than one. Perhaps that is the Hilary Wainwright’s report details the success experience of nations who don’t know what they that Portugal’s socialist government has had in want. For those with a clear agenda, that they challenging the EU – its restrictions but more make a sustained, rational and ethical argument for, fundamentally, its assumptions. European history, conclusions are anything but foregone. by 2015, was on prime minister António Costa’s Yet the more fundamental conclusion is this: you side. The casual pursuit of austerity was losing do the EU no favours by ignoring its faults, but it is favour generally, and had hit a hard stop of moral not a fixed entity, and what look to be its long‑term legitimacy in the Troika’s treatment of Greece. strategic goals are subject, always, to the will of Portuguese socialists, in their determination its members. It can only realise the ambitions of its to bring radical, immediate and practical benefit founders, of peace, reconciliation, solidarity and to citizens’ lives, were able to prove in real time broadly distributed prosperity, if its component that those austerity measures had been broadly nations are fighting for those ends. economically damaging as well as ideologically It can only unleash those values upon the specific driven. In doing so – increasing the minimum challenges we face today if its nations adapt, and wage, unfreezing pensions, increasing tax on remain determined to face collective problems corporations, attacking precariousness in the collectively. workplace and reversing privatisation – the country Whether it’s an overweening corporate voice proved both an inspiration to others and a test bed and worker insecurity, a resurgence of the far-right for a new relationship between individual nations and racist policy, or climate change and the loss and the institutions of the EU, one that was closer of biodiversity, none of these threats contain to the egalitarian ambitions of its founders. themselves neatly behind borders; no nation, on its This is a significant intervention for those on the own, is a match for any of them. left who argue for a Brexit, or “Lexit”. Many of the The experience of Portugal, though, has shown rules that are seen as obstructive to the socialist that no nation needs to be. 3 KEY FINDINGS The government of the Portuguese Socialist Party, supported and, to a large degree, pressured by an alliance with Communist Party and the Left Bloc, has shown that it is possible to implement an effective anti‑austerity programme as a member of the EU. This entailed successfully standing up to the EU negotiators and facing down their repeated opposition to the government‘s measures. The result was a reversal of all the austerity measures introduced, under the supervision of the Troika, by the previous conservative government – while remaining within the EU’s 3 per cent deficit limit. The possibility of the success of these negotiations from the Portuguese standpoint depended on a favourable balance of power reinforcing the government’s bargaining position. This, in turn, was a product of: (a) strong civic resistance to austerity towards the end of the previous government; (b) parties to the left of the Socialist Party (PS) yet in alliance with it, having the autonomy to campaign openly for a strong stand against EU pressure; and (c) a background of judgements by the Constitutional Court against several of the previous government’s austerity policies for infringing fundamental rights. The democratic constitution – drawn up in 1976, in the aftermath of the popular overthrow of the dictatorship in 1974 – contributed to the favourable balance of power. This history of political pluralism means the system allows for a plurality of parties that could ally with the government (eg. on anti-austerity measures), which at the same time have the autonomy to express distinct long-term goals (for example, opposition to the neoliberal principles embedded in EU treaties). Economically, the anti‑austerity measures had a multiplier effect on consumer confidence and expectations. The Portuguese experience illustrates how individual countries can work in a direction contrary to the neoliberal orthodoxy of the Maastricht and Lisbon Treaties. Moreover, it also opens up the possibility of a longer-term strategy aimed at changing the EU treaties themselves, by creating a critical mass of national governments acting as Portugal has done to negotiate a minimal level of protection against austerity within the EU rules. This creates a space, which, over time, can then be broadened outwards, as Portugal finds allies to fundamentally reform them at the EU level. Given the almost clean sweep of neoliberal and now far-right governments across Europe, this may still be some way off. However, Spain has now moved in the same direction as Portugal and this provides an opportunity for the UK, under a Jeremy Corbyn-led government, to both remain and reform. 4 THE PORTUGUESE EXPERIENCE Faced with the choice in Britain between a free market, xenophobic Brexit and a neoliberal EU, it is useful to learn from the experience of a government that has succeeded in challenging neoliberal austerity from within. In Portugal, just such a government is coming to the end of its four-year term. I went to investigate as the parties that lead and ally was not in a strong position to impose its policies; with this government are assessing the experience it did not want another Greece or, after 2016, themselves, while preparing their electoral another destabilising equivalent of Brexit. But most programmes for elections in October 2019. important was the balance of power nationally, The experience brings useful empirical evidence in Portugal, due to the strength of Bloco and the to bear in favour of an alternative to the simplistic PCP, with their adamant insistence and public choice between Brexit, or an unquestioning campaigns for the terms of the agreement to be acceptance of the treaties of the EU, as we prepare met. Their strength and their resilient politics made for the possibility that the British public will have a it impossible for the PS government to concede to final say in a further public vote on the issue. the EU and stay in office. The experience of the Socialist Party minority A collapse of the PS-led alliance of the left government in Portugal – reversing the Troika would have driven the PS into the hands of the imposed cuts in salaries, services and social right – a fate considered to be political death by security through an alliance with parties to its left – PS leaders who looked across at the collapse of is an interesting experience in itself. It is exceptional their sister party Pasok in Greece after it allied with in several ways. the centre‑right. The spectre of Pasokification (a For a start, it is a minority socialist government, term that recurred frequently in conversation with which, rather than ally with the centre-right as its PS MPs, ministers and activists) haunted the PS, European sister parties have done to their cost in as it did most social democratic parties in Europe the recent past, allied with the Communist Party after Pasok’s vote plummeted from 43.9% in 2009 (PCP, an orthodox Communist Party and leading to 6.3% of the vote in September 2015. Propping force in the overthrow of the Salazar dictatorship) up a right-wing coalition as it pursued the policies and the dynamic and growing party of the radical of the Troika in Portugal would have doomed the left, Bloco Esquerda (at first a convergence of PS to joining Pasok in the family grave of European Maoist and Trotskyist groups, it has attracted social democracy. social movement activists and radical intellectuals The Portuguese experience was exceptional too ever since its formation in 1999). This decision by in the pragmatic, popular and confidence‑raising the PS to look leftwards reversed the traditional anti-austerity programme of this ‘geringonca’ culture in Portuguese politics, which tended (the ‘contraption’, as this surprise left alliance towards collaboration between the centre-right and was pejoratively termed).