Catalonia, Spain and the Referendum

Sad times. Despite having the law on their side with regards to the October 2017 referendum, the Spanish Government of the Conservative Partido Popular (PP) has showed a formidable degree of political incompetence on a number of fronts, not to mention the clumsiness of the police actions. My solidarity goes with all those good Catalans who today suffered from their brutality.

As the possibility of a referendum became clearer during 2016, the Spanish Government’s sole reliance on the Rule of Law and law enforcement, legitimate as it might look, became a self-defeating excuse not to deal with the underlying political dispute. When the Catalan Government set in motion its illegal referendum in September 2017, violating even the rules and procedures of the Catalan Parliament, this process of self-determination had gone too far for it to be simply stopped with the intervention of the judiciary and the police.

People injured in the streets. Polling Stations shut down by the police. Members of the Catalan Administration arrested and charged with Contempt of Court or Misconduct in Public Office. These scenes are pathetic. A Government should never resort to the Criminal Justice System to deal with an uncomfortable popular movement and with an entire branch of the State (remember that the Catalan Government, autonomous as it is, is also part of the Spanish State). We all know that the referendum is technically illegal. The actions of the Government of Spain in the run up to the vote have already rendered the referendum logistically unfit for purpose. Its celebration has just turned into an act of protest. There is no point in confronting people who want to use it to express their discontent. That is the wrong “policing” approach.

It is difficult to imagine why the Spanish Government would have wanted to pursue this suicidal strategy, but we need to bear in mind that the Conservatives in Spain are being sieged by the Spanish Judiciary itself. The corruption cases are far too serious and too numerous. Distracting the attention with Catalonia may prove a last attempt to survive. The recent appearance of enthusiastic unionist demonstrations across Spain where Spanish flags are waived, something quite unusual except for tiny far right groups or anti-terrorist demonstrations, may prevent the loss of votes of the Conservatives amongst their traditional voters, who now see the PP as the staunch defenders of the Rule of Law and the unity of the motherland. The chances of Ciudadanos (“Citizens”, the Catalan-born Spanish party that shares with them the centre-right of the Spanish political spectrum) to challenge PP’s hegemony diminish as voters may prioritise a strong majority government over a divided centre-right in opposition.

One factor that must be taken into account to explain the reluctance of the Conservatives to engage with the Catalan issue is the personality of their leader, Mariano Rajoy. Starchy and hard to read, he seems to live on a fence, or rather sleep on it. Some accuse him also of procrastinating, and the far-right call him a coward for not acting more harshly on Catalan independentists, or for not having sent “the tanks” some years ago.

A lot of negative energy has been accumulated for several years and, sooner or later, it was going to explode. Obviously, the Government in Spain must go. At the end of the day, it was the Conservative Partido Popular (PP) who promoted, with some degree of success, the annulment of key sections of the enhanced Statute of Autonomy of Catalonia, that had been passed by the Catalan and Spanish Parliaments in 2006. This was a humiliation and a provocation to the Catalan Nationalist parties and to the Catalan Left that changed the course of Spanish politics. Elections should be called in Spain. The PP have disqualified themselves automatically as interlocutors of a necessary dialogue. Alternatively, the rest of parties of the Spanish Parliament should create a provisional coalition government to deal with the situation. PP are in minority, just supported by Ciudadanos. There is no time to waste.

The evil is in the nation

In order to envisage a solution to this mess, I think it is necessary to reflect upon some of the root causes of this confrontation. To me, the Catalan conflict is a confirmation that the Nation, a concept that is usually interchangeable (wrongly) with those of country, state, territory or community, an emotional and discursive construct that has caused wars and frustrations for two centuries, is still the main enemy of peace in Europe, if not in the entire World. Let us look at the case of Spain:

In Spain (the territory of the State) we have plenty of nations, almost as many as politicians.

These are some of them:

A Spanish nation with different ideological “variants” (the 1978 Constitutional nation, the pluri-national nation, the historic liberal nation, the republican nation…);

Autonomous communities

Figure 1. Map of the current Estado de las Autonomías, with the borders and flags of the Autonomous Communities.

A Basque nation that expands over the Spanish Basque Country, the Kingdom of Navarre in Spain and parts of France (7 territories), but whose political structure currently resides in the Spanish Autonomous Community of the Basque Country, made up of 3 territories of those 7 territories (Bizkaia, Gipuzkoa and Araba). (figure 2);

Euskal Herria

Figure 2. Euskal Herria (Greater Basque Country) stretches over territories of the French State to the North plus Navarre and is the area claimed by most Basque nationalists are their homeland, well beyond the current Autonomous Community of the Basque Country.

At least two Galician nations, one of which occupies parts of other regions where Galician is spoken;

And finally, at least two Catalonias:

The one whose territory coincides almost exactly with the current Autonomous Community of Spain (figure 1) and with the principality of Catalonia from the late Middle Ages;

And the so-called Països Catalans (Catalan-speaking countries), an idea that was made popular in the 1960’s, a cultural and linguistic nation that for the main Catalanist parties in Government is seen in the long-term as the true political subject of a future Catalan State. Mainstream Catalan nationalism, in power from 1980, has assigned to this nation a wide territory that comprises not only Catalonia but also the current Autonomous Community of Valencia (Alicante, Castellón and Valencia itself), the Balearic Islands, the French region of the Roussillon, a city in Sardinia, Italy, etc. Interestingly, bilingualism (Spanish or French or Italian and Catalan is the norm in those places. (figure 3). For Catalan nationalists, the political integrity of this “cultural nation” is a very vivid aspiration. Their parties and, even the Catalan Government, promote pro-Catalan groups and national ideology in those territories whose population, largely pro-Spain, regards this movement as a sort of intrusive cult.

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Figure 3: The Catalan Countries, the homeland of most Catalan Nationalists.

Here lays one of the many complications brought about by the pro-independence referendum:

Spaniards do not have a default smaller “core” nation where to place their identity and historical references if the Spanish State, which is seen as their political expression of that nation, were to break up. Regional identities do not stretch so far in most places so as to become “national”.

In the Island of Great Britain, we have three recognisable nations (England, Wales and Scotland) which pretty much have territorial and cultural stable references. If Scotland were to break up, English people would always have England as a nation to venerate. Nations in Spain, however, are a different species all together, not just because of their overlapping and almost phagocytic nature, but because all the existing versions of the Spanish nation encompass the land and the population of the Autonomous Communities of Catalonia, Galicia and the Basque Country.

The reasons why we have such an overlapping national concoction are complex, but I will try to offer a take on it that readers will find hopefully illuminating:

The first legal formulation of a Spanish political nation whose sovereignty resided not just in the monarch but in its people, came about in the liberal Cádiz Constitution of 1812. Those “national statements”, passed by the Assembly of notables from the whole of Spain, predate the claims for modern nationhood of the rest of the nations in the Spanish territory, which can be traced back to the last third of the 19th Century in the form of initially minority regionalist movements.

I am not denying that the Principality of Catalonia, as well as the Kingdom of Aragón, the Kingdom of Valencia and the Kingdom of Majorca were distinctive political entities, some claim sovereign, before 1714 (The end of the War of Succession). I am not denying the fact that Catalan was the autochthonous language of three of these four territories. I am simply stating that there was not ever a Spanish nation, as a modern political formulation, that did not include the abovementioned Iberian territories. When the Cortes de Cádiz declared the Spanish nation in 1812, there was not another group of notables in Catalonia with a gathering and a programme remotely comparable to that of Cádiz at all. It is precisely because of this that the Spanish project as a nation-state grew the way it did, with all its imperfections and divisions. As a result of it, nowadays, for a majority of Spaniards, the territories of Catalonia, Basque Country and Galicia, are an integral part of their nation, as a cultural and historical representation that they feel emotionally attached to.

We can think of many different formulae to make State boundaries and national boundaries to reflect better what happens in life and politics. For instance, I could envisage an independent Catalonia where the Spanish nation is also recognised by a Catalan constitution as overlapping with their territory. At the end of the day, the majority of Catalans (still) have a dual national identity (Catalan and Spanish). However, in the current scenario this rosy solution is very hard to imagine.

Catalan Nationalism and manipulation

Nations are, primarily, emotional constructs, deeply embedded psycho-social phenomena. Unfortunately, media, politicians and the education system in Catalonia have not done much to prepare the terrain for a seamless future. Quite the opposite. In the last 35 years, the Government of Catalonia, that has been ruled one way or another by parties with a nationalist agenda since 1980, has engaged in a nation-building programme that involved, controversially, representing Spain as an external enemy of the Catalan people, whose spirit and institutions had been allegedly defeated by a military prone Spanish State.

These educational efforts were accompanied by the fostering of a popular culture of Catalan national distinctiveness by nationalist politicians and public figures that relied often in the worst of bigotry. I am not denying the friendliness and tolerance of the majority of Catalans I have come across in my life, but as much as I love my friends who live there, many of them in favour of the referendum, I would like also to tell them that Catalan voters should not have backed time and again the two political parties that harboured anti-Spanish bigotry since 1980, which are the current parties in Government in Catalonia today (hopefully for not much longer): ERC, Esquerra Republicana de Catalunya (Republican Left of Catalonia) and PDeCat, “Democratic” Party of Catalonia, formerly Convergencia.

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“The Subsidised Spain lives off the Productive Catalonia”, explains one of these posters. This is replicated in demonstrations and popular discourse.

The PP, a party that as you may have gathered I dislike, has recently shown a collection of public statements made by Catalan Nationalist politicians and public figures:

Spain is robbing our money. Anarchic Andalucians lay idle and live in spiritual, moral and cultural misery. We are more like the French. I would not like to see someone with a non-Catalan name as the President of the Government of Catalonia. You are only Catalan if you are born here. If you speak Spanish, you are a coloniser. Being Spanish and being a thief is the same thing.

These are some of the statements made by politicians and public figures in the video, in a more elaborate and inflammatory way.

 

Sadly, this persistent abuse has not been publicised and denounced widely throughout all these years. There was a sense of guilt in Spain about Franco’s cultural and political repression that prevented anyone in the Left and the Centre of politics to take issue at Catalan abusive nationalism in public. Catalans nationalist politicians were allowed to insult, probably because their outbursts were perceived as a form of legitimate catharsis or revenge against Spanish right-wing nationalism. For as long as these vociferous members of those parties respected the constitutional frame of 1978 and kept playing ball in the Spanish institutions, they got away with it, as if it all were just an extension of Real Madrid-Barca banter. If anyone in the Left or Centre of politics raised the issue of school and media brainwashing, or the insults, s/he would be accused by Catalan Nationalists to play into the hands of Spanish right-wing commentators, who, vile and despicable as they may be, were the only ones who denounced with some conviction these abuses.

Whilst the majority of Spain children have been learning at School since the 1980’s the 1978 Constitutional creed of a diverse pluri-cultural Spain where regions and “nacionalidades” (a term used by the Spanish Constitution -“nationalities”- in reference to Catalonia, Galicia, Basque Country and any others) lived under a revamped peaceful and democratic umbrella, in Catalonia, text books and media were offering a version of their “nation” that was rather less appeasing.

I have to recognise that the most recent discursive formulations of the Catalan national project, in the last 5 years or so, are much more intelligent than their predecessors’, as it can be appreciated in the words of Junqueras in that video, when he addresses this question. Currently, there is a concerted effort among Catalan Nationalist top politicians to offer some friendliness to Spain which has to be welcomed. This has allowed the pro-independence cause to grow in numbers, as many of the Catalans who support the referendum and independence are the children of Spanish migrants who went to Catalonia in the 1950s and 1960s.

Nevertheless, I dare to say that most Spaniards outside Catalonia do not really believe in the sincerity of this calculated change of emotions by the Catalan nationalist (populist, in the worst sense of the word) politicians. The damage has been done already, both educationally and in terms of intercultural relations. The politicians and public figures who appear insulting Spaniards in the video are very much in the driving seat of the current “Process”.

The intervention of the Government of Spain in the referendum, and the popular reaction of some sectors of Spanish society in support of the Spanish police forces, is certainly going to make it even harder for people to deal with their differences. Now that the gloves seem to be off, courtesy of Catalan Nationalism and the Conservative Spanish Government, both to be blamed for the current stalemate, I am not sure how much can be reasonably done for the sake of mutual understanding.

A reflection from a Democratic Left perspective

Radical Left parties such as Podemos support the celebration of a referendum and, naively, entertain the idea that an independent Catalonia resulting from this very process would be easily invited back into a new non-monarchic Spanish confederal State, made up by different Spanish republics with a renewed injection of popular, state-wide legitimacy, away from the corruption of previous Spanish Governments. Appealing as this may be for me, this formula is not really part of the agenda of most of the actors of this Catalan “Process”:

The current Catalan Government, sustained by the coalition Junts Pel Sí (Together for Yes) includes, alongside the moderate left-wing ERC, the Conservative-liberal PDeCat. This party, like their State-wide Conservative PP Spanish counter-parts, is riddled with corruption. They have been a dominant force in Catalan politics for decades and now the Courts of Justice are acting upon their abuses whilst in power.

The extremely confrontational attitude of PDeCat, who has only embraced independence demands over the last 6 years, was a result of their electoral decline provoked by corruption scandals, as much as a strategy to force the Spanish Government to negotiate concessions for Catalonia. As their strategy failed and the Spanish Government called their bluff, PDeCat could not be seen blinking on the question of the referendum.

One factor that accelerated the triggering of the referendum was the weakness of the minority Junts Pel Sí government in Catalonia. For them to pass the budget and all the legislative projects of the Referendum and Independence Process they needed the support of the radical left anti-capitalists CUP, who certainly do not see the referendum as a simple bargaining chip, as they believe that Catalonia’s independence is the start of an anti-capitalist grass-roots revolution. It is the CUP who precisely have made the referendum unavoidable, as they are propping up the Junts Pel Sí coalition on that condition. Moreover, in the tradition of PDeCat, there is no other scheme of relations with Spain than “bilateralidad”. They have no intention to engage in an exercise of State engineering, like their predecessors did, exceptionally. Convergencia’s (now PDeCat) Miquel Roca i Junyent participated in the Constitutional drafting group, made up 7 Spanish MPs that made possible the 1978 agreement. The Spanish Constitution of 1978 received overwhelming support in Catalonia partly for that reason (91%+ of affirmative votes!).

I believe in the need of a social and cultural revolution to deal with the failure of capitalism. I personally would defend a referendum on things like nationalisation of public utilities and key industries, for instance. But this Catalan Process, has little to do with anti-capitalist aspirations, as the CUP would like to think. It is a shame that left-wing activists who defend a no-borders approach to humanity and the unification of the working classes are wasting their energy in dividing people and playing a chess game by proxy, in the hope that the chaos brought about by the referendum will help them to spread their revolutionary message and over-throne the capitalist system. I think they are absolutely deluded. Look at the example of Brexit and “Lexit”: Where is the left-wing ingredient of Brexit in the current negotiations with the EU or in the dominant media and public opinion? Pathetic. I was recommended to read a Spanish intellectual called Joaquin Nim who theorised in 1934 about how working-class movements could be built on the back of nationalist movements and I really did not have the energy to finish reading such a flawed article.

Chaos benefits those who hold an alternative power, cultural and political. The alter ego of the Spanish State is not a democratic paradise of equality and socialist emancipation, but a Catalan Switzerland (or a Catalonia with the tax advantages of the Basque Country), as dreamed by many right-wing Catalan independentists, a Catalan Sweden, as per the aspirations of the more left-wing ERC or, hopefully not, a Catalan Bosnia.

Whilst I feel uneasy about politicians been arrested for organising a referendum, even though it is illegal, and I feel very strongly about the use of police force against innocent voters/protesters, I clearly would applaud the imprisonment of all the Catalan public figures who have incited anti-Spanish ethnic hatred. They have had a hand in this intercultural disaster.

Conclusion

We now have different groups of well-intentioned, not so well-informed, citizens trapped in overlapping, sprawling, imperfect “nations”. Democracy has been fetishised around this Catalan referendum, a totem which, to me, is not the start of a democratic revolution but the end of sad story.

When I saw the President of Catalonia in a recent interview with Al-Jazeera blatantly lying about some key, uncontroversial facts, just for the sake of effect, in front of an unprepared journalist, I could not avoid feeling despair. The same happens when I see people from Catalonia passionately wanting to take their country back. Like in Brexit, the Catalan Process responds very well to a perverse global tendency: one-off disposable democracy, fake news, identity politics and insults.

I recognise the right to self-determination of peoples, but who is, emotionally and politically, entitled to decide in Catalonia, which for most Spaniards is inhabited by members of their own people, their own nation? What types of majorities would you need in Catalonia to support independence?

It is time for both Governments, the Spanish and the Catalan, to resign and let other parties to take the lead and look for a long-term solution to all this. Both PP and Junts Pel Sí have pushed us all into this sorry situation with their blind populist pride. The European Parliament should investigate all abuses, including media abuse and indoctrination, and mediate.

Meanwhile, people need to calm down. Mutual trust has to be rebuilt. I suggest that we all post in social media one thing that we like of Catalonia or Spain every day. Despite my bitterness in this article, I get quite emotional when I think about friends there and the good times I always had in Catalonia.

I now expect fanatics and radicals, some more polite and educated than others, from all sides, Russian trolls, Little Spanish Francos, Catalan Cyborgs and Assanges to call me all sort of names or even ban me.

If they bark, we must be riding.

Common sense for Catalonia

Regrettably, as we speak, the first arrests resulting from the confrontation between the Spanish State and the Government of Catalonia are taking place. Public officers of the Catalan government will soon be charged.

Nobody can question, legally, that these officers appear to have committed a criminal offence. They are acting against legally binding resolutions by Spanish judges that are technically legitimate. The resolutions adopted by the Catalan Government in order to initiate the referendum have been declared illegal. They are not only in breach of the Spanish constitutional system. They are even in breach of their own rules in Catalonia. The motion passed by the Catalan Parliament in support of the referendum did not respect their own laws, as I explained in my previous article. The Spanish legal system, similarly to the UK system, regards the breach of a legal duty by a public office as a criminal offence. Over here is called “Misconduct in Public Office”.

I don’t think the arrests are part of a campaign of arbitrary police repression. Everyone knows that the Government of Spain is under fire, nationally and internationally, for its inability to deal with all sorts of Catalan political demands in the last decade. The eyes of all commentators in the world are cast on these arrests. That is why I am sure the police and the public prosecutors will act not only proportionally and humanly, but exquisitely. Any allegations of brutality would give strength to those who want straight independence and the Spanish Government, politically clumsy as they may be, are not stupid.

The intervention of the police, confiscating databases and documents that are essential for the celebration of the referendum will most likely render it impossible to hold. Also, as we speak, people in Barcelona and other places are peacefully demonstrating against the arrests, demanding a referendum. The calls for peaceful demonstration and non-violent resistance by Joan Tardá (ERC) this morning suggest that there is a fear that some smaller groups may want to use the public uproar to justify less-than-peaceful actions.

The whole situation is utterly lamentable. Millions of people in Catalonia have been exposed to hard anti-Spanish propaganda by their Government. “Spain is robbing us” was one of the most popular claims of activists in Catalan nationalists parties. They are understandably upset and furious.

Meanwhile, a high proportion of Catalans experience political disempowerment in silence. In the last elections the majority of voters opted for parties that do not support independence. These pro-independence parties have a majority of seats but not of votes.

The case for independence made by mainstream Catalanist parties is based on distortions of history and political interests of the lowest kind. I cited a recent example in my previous article of blatant historic manipulation and explained that independence is being used as a political tool. This is irresponsible. And so is the whole policy of the PP, the Spanish Conservatives, who not only torpedoed the revamped 2006 Catalan Statute of Autonomy, but failed to make a meaningful case for public support of unity of the Spanish State in Catalonia. Nor they considered dialogue with Catalan Governments and other Spanish parties. Their perverse strategy could be summarised as this: relax and Laissez-faire because if things turn nasty, the Rule of Law is on our side.

On the positive side, yesterday, a motion by the Ciudadanos (Citizens) party, who are strongly against any referendum and defend the constitutional unity of Spain (interestingly, this is a Catalan-born party and its leader, Albert Rivera and its main political figures are Catalans) was defeated in the Spanish Parliament. Ciudadanos wanted Spanish MPs to vote in favour of a declaration of support of the Spanish Government and all the public officers dealing, in one way or another, with the referendum, including those majors in Catalonia who are not facilitating the preparations for the referendum in their local authorities and are being pressurised by vociferous pro-independence groups. The reason why the motion was not passed is that PSOE (Socialist Party) voted against it. The Socialists had suggested an amendment to the motion whereby a paragraph calling for both the Spanish and the Catalan Governments to open a dialogue was to be introduced. Ciudadanos rejected the amendment and they, alongside the Conservatives, PP, were consequently defeated.

The majors of Barcelona, Colau, and Madrid, Carmena, are calling for dialogue. The Socialist PSOE have accepted to be part of a parliamentary commission, proposed by left-wing Unidos Podemos, in which Catalan political parties would obviously participate, that would consider the options ahead and initiate a mature conversation.

Now that the referendum game seems to be over, there will have to be elections in Catalonia. It is almost inevitable. It is time for a new concerted progressive action in the Spanish Parliament, where the minority Conservative government have to rely on Ciudadanos and, interestingly, the Basque Nationalist Party (PNV) for approving their budgets and pass major laws.

My biggest concern is to do with public perceptions and emotions. Think about ardent Brexiters in Question Time and their heated rhetoric and arguments. Who will explain now to their Catalan equivalents, the “Catalexiters”, that the Spanish State does not really steal money from Catalonia? That independence would not actually bring back all those millions a week to their pockets. That sovereignty in the 21st Century is better exercised in a federal way. That Spain is not a Francoist creation, a historic evil monster of warriors and ignorant peasants who live off laborious Catalans. Who will tell them that for most Spaniards Catalonia is also part of their “Spanish Nation”, as much as for many Catalans the province of Alicante (strongly pro-Spanish, in the Valencia region) is also part of their “Catalan nation” (This is called the Catalan Countries)? After a relentless cultural campaign of perverse Catalan nationalism over the years, a lot of hard work to appease and educate is needed.

On the Spanish side, who will be able to persuade those fervent centralists, who wish for the abolishment of the current federal structure of the Spanish State, that Catalonia is, as I believe it to be, also a nation? That nations overlap. They have been also intoxicated by Spanish nationalist right-wing propaganda.

To me, there is an urgent need to increase grass-root educational efforts at all levels, promote alternative media and preach tolerance whilst being open and determined about the distortions and lies of elites of nationalist politicians who are to blame for all this.

The Catalan Countries overlap with other historic and political territories, mainly in Spain and France, extending well beyond Catalonia. Bilingualism is the norm in all those places. A complex set of variable multilayered national-regional identities and loyalties populate those territories.

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Madrid is robbing us. Spain is robbing us. The subsidised Spain lives off productive Catalonia. propaganda from the two main parties of the current Catalan Government, plus newspaper cover.

Brexit and Migration

 

I truly dislike talking about human beings solely as resources for the economy. We are not just pieces of business machinery. Each one of us has a heart full of aspirations, emotions and memories. We are loving neighbours, mothers, brothers, sons and friends to other people who love us too. We have talent, culture and spirituality, whether it is religious or not. We share humanity with everyone. We are the Rivers of Life feeding the Oceans of Hope.

However, since the debate about migration in this EU referendum has focused mainly on how migrants contribute (or not) to the economy and on how to “control numbers”, often with demeaning language, I feel the need to share with the readers a reflection, primarily in economic terms, about migration. Sadly, these are the parameters of the debate and responses on these grounds are also needed. Unfortunately, the urgency of the situation requires it. The stakes are high.

The referendum campaign has been tarnished by very sad episodes of political abuse and even violence, including the tragic death of Jo Cox, a brave woman who defended noble ideas and values and served her community and the country with diligence and enthusiasm. Leaving the EU, as we may be about to do, led by a right-wing movement that rides high on the back of the beast of media xenophobia, fanatic patriotism, dubious democratic claims and self-interest (a movement whose messages have surprisingly captured the imagination of millions of decent Britons!), will be catastrophic for our country.

The debate about the effects of EU migration on the UK economy is simply misguided. Many Brexiters do not acknowledge that EU migrants fill in positions that the local workforce cannot. Migrants are also consumers, pumping up Britain’s GDP figures. Crucially, reputable studies have demonstrated that the value of taxes paid by EU migrants in Britain outweighs the value of the public services that they receive. It is true that different methodologies to calculate the net contributions throw out different figures. Quantifying this is not easy, as shown in this study of the University of Oxford. However, nobody  challenges the fact that EU migration into the UK has been, in fiscal terms, beneficial.

Nevertheless, one of the important points I want to make about migrants’ contribution is that there is a big elephant in the room that nobody talks about in any of the studies cited during this campaign by any of the camps. I call it the “Migrant Premium”, as there is not an easy straight forward term to define it in econometrics, but the premium falls under the well-known category of “human capital gains”. This concept extends beyond any comparison between migrants’ tax receipts and migrant’s use of public services, as it refers to the impact on the wider economy, not just on the public purse (1).

What is the “Migrant Premium”?

If we look at the figures, the cost of bringing up a child in the UK from birth to adulthood is at least £40,000 at 2016 prices. This figure only covers education and health. The cost of state schooling comes to more than £22,000 (2), whilst health costs are in the region of £1,000 a year for younger age groups (3). If we add health and university fees costs for the 19 to 22 year-old group, we have an extra £30,000 on top.

When a young non-university educated migrant comes to Britain, ready to work and pay taxes, he is saving at least £40,000 to UK Plc. If it is a graduate, just with a 3-year degree, that figure goes up to £70,000. This is the replacement cost of that influx of human capital per person.

There are many different ways to calculate the Migrant Premium and I look forward to old and new studies on this matter, but the above estimate is, if anything, on the low side. Bear in mind that we are not including here any other costs, such as maintenance, housing or any other private or public spending that the young person benefited from directly or indirectly in his or her country of origin.

The Migrant Premium surely plays a role in sustaining the U.K. Economy. Our country has been able to increase, on demand, its working and tax paying population without having to invest huge amounts of money. Migrants land in Britain and start paying taxes as they begin consuming and working.

Conversely, the Migrant Premium is a “migrant loss” for the countries whose public services have subsidised the health and education. Basically, the U.K. and other Western economies “import” ready-to-work human capital for free. Germany, when it comes to EU migration, and the United States are our main competitors in attracting human capital. Regrettably, this important asset migrants bring with them to the UK’s economy is not taken into account in any of the calculations disseminated in the media about the benefits of migration. If you find one, please share it in the comments.

Brexiters with an understanding of economics know, in broad terms, about the Migrant Premium, but they don’t want to acknowledge it because it gives breathing space to the opposite camp.

In my discussions with people who intend to vote Leave, whenever I have been successful to demonstrate the immense benefits of migration to the UK, I have then been confronted with other migration-related arguments that would justify leaving the EU. Here they are:

The all-time favourite Brexit icon: an “Australian point-based system” 

This system does not stop or reduce migration. It just provides a sense of control and allegedly filters migrants according to their “quality”. This is a very classist and perverse idea, as it could create a two tier workforce: the low-paid workers, made up primarily of UK nationals and some pre-Brexit settled down migrants, (the points system would stop people without high professional qualifications to come to the UK) and the better or well-paid workers, which, as the proposers of the points system acknowledge, will be, proportionally, made up of more and more highly educated workers from abroad. The points system would allow to fish for skills in a wider sea and perpetuate the situation of underinvestment in training and education for professions such as doctors, nurses or teachers. If their governments in their respective countries train them for us for free, why bother? I am afraid, business principles dominate Conservative-UKIP political practice.

What is the other problem with the Boris’ and Nigel’s “Australian system”?

In an economy like ours, or Australia’s, younger workforce is essential. Businesses need it desperately. That is the reason why people come here. Make no mistakes, U.K. Welfare is not available for newcomers and is not good enough in itself to justify coming here, anyway. The freedom of movement provided by membership of the EU enables changes in supply and demand for labour in any country to be self-regulated, without State intervention. Additionally, the EU is a massive space of 500 million people where to find the right professional profiles when needed.

I am not a believer of free markets as the best solution for many human needs in our society, but I have to say that I very much value the freedom of taking up whomever one thinks is best for a job, or choosing for whom one works. If I ever set up a business again and need someone to work for me, the last thing I want is to fill in immigration forms, ask prospective candidates to fill in even more forms and expect Boris Johnson’s army of Whitehall Bureaucrats to make a decision about who I should take on for a job based on the points system they have designed. There is not anything as illiberal and centralising as that. Employers know who they need and why, employees know who they would want to work for. It is their decision. The EU enshrines precisely that principle through the free movement of workers in our common space.

Some people argue in favour of this points-based system by defending that non-EU citizens should not be discriminated against EU citizens, despite the fact that non-EU migration in the UK remains stronger than EU migration according to Migration Watch. Fair enough. Let us create a system that gives non-EU citizens easier access to jobs if needed. But leaving the EU and imposing restrictions on everybody is a massive step backwards that do not really benefit anyone at all.

Undercutting and discrimination of UK nationals

The other argument used by many to defend a vote for Leave is the very legitimate concern about  local workers being undercut.

I do believe we should work harder to eradicate any business practice that effectively discriminates local workers. David Cameron stated in PM Questions this week that his Government was taking action against agencies that only recruit foreign workers. This was in response to a question by Labour Leader, Jeremy Corbyn, who has shown that working conditions and rights are again at the heart of Labour’s agenda. The enforcement of a (higher) decent minimum wage should also be pursued. Finally, as a through study by CERIC Leeds shows (4)  “The Brexit scenario would have even more detrimental effects on the employment and bargaining rights of both UK nationals and migrants.”

Population growth and public services provision

This is of course an understandable concern. In my view, however, the biggest issue about the UK’s alleged overpopulation is that there are areas in the South of England that are real magnets for UK migrants (internal) and non-UK migrants. Their economic growth out-paces everyone else’s in the country. Other areas, particularly in the North, have registered very slow growth in population recently. Blackpool and Sunderland even lost population between 2007 and 2012 (5). The density of population of the U.K. is not that high at all. We are not even in the 50 most densely populated countries in the world (6).

Obviously, the unbalanced distribution of wealth, opportunities and population in the UK has nothing to do with the EU and is a serious problem that will not be solved by leaving the EU. If anything, the poorer areas of the UK will lose out even more by leaving the EU, as the dependency on manufacturing jobs is much greater there than in the South East and this is one of the sectors who would suffer the most. Successive UK governments in the last 40 years have not done enough to redress or alleviate this imbalance. It is their (our) call.

Insofar as the provision of services, the “Migrant Impact Fund”, which was introduced by labour and withdrawn by the Tories, is back on the cards and should be used as a policy tool to ensure that a higher amount of the taxes generated by new local and foreign arrivals in any given area are dedicated to the public services of that area.

Thank you!

All in all, we should be thankful to our migrants for choosing the UK as a destination for their Migrant Premium. We all know they are also grateful and happy to be welcome amongst us. They could have chosen Germany, Holland or Finland, where in-work benefits, public services and wages are better than here, but in instead they joined us. We must be doing something right as a nation. Let us be proud of it.

Let us remain in the EU.

 

Notes

(1) Methodology: The purpose of this part of the article is to highlight the indisputable existance of a substantial Migrant Premium of at least £40,000 at the time of the arrival of the working migrant in the UK. Therefore, the valuation of that premium has been kept on the low side and “replacement costs”, as suggested by Bowman (below), have been used. This is not a longitudinal study of the actual returns of the human capital brought into the economy by each migrant over time and it assumes that the migrant is ready to take a job. There are longitudinal (over the time) studies about the benefits of migration in terms of human capital, but as I suggest when I discuss the question of tax receipt vs public expenditure (Oxford University study cited), the problem is that there are so many different methodologies used to quantify the flows of capital that we run the risk of not acknowledging the existance of obvious magnitudes such as the Migrant Premium for not having found total agreement amongst economists and statisticians on how precisely to measure it. Two recommended readings for those with a professional interest on this question:

Bowman, M.J. “Principles in the Valuation of Human capital”. Review of Income and Wealth. Volume 14, Issue 3, pages 217-246, September 1968

Schaeffer, P. “Human Capital, Migration and Brain Drain”. Journal of International Trade and Development. Volume 14, No 3, 319-335, September 2005

(2) http://www.telegraph.co.uk/finance/personalfinance/10169865/Costs-for-state-school-hits-22500-per-child.html

(3) https://www.theguardian.com/society/2016/feb/01/ageing-britain-two-fifths-nhs-budget-spent-over-65s .

(4) https://cericleeds.wordpress.com/

(5) http://www.centreforcities.org/blog/population-growth-and-migration-in-uk-cities/

(6) https://simple.wikipedia.org/wiki/List_of_countries_by_population_density

Picture credits: http://www.weforum.org https://www.weforum.org/agenda/2016/01/how-immigration-has-changed-the-world-for-the-better/

 

Beautiful England

“wert thou the unicorn, pride and wrath would confound thee and make thine own self the conquest of thy fury” W. Shakespeare, Timon of Athens, Act 4, scene 3, c. line 341

Oh Beautiful England,

Green maid
Longed for
By warriors
And nomads
And traders
And workers
And dreamers
From Abroad,

Whose Children,

Sometimes blond
Often not,

Have turned you
Into a mirror,

Into a mirror
Of the World,

Tell your sister,
The other England,
Who still believes St George
Was from Windsor
Or Newcastle
Or St Albans
Or Stoke,

Tell her,
For our peace of mind,
Tell her
Who her real parents were.

Tell her
That it’s millions,
Many millions,
Of all tongues,
Who make you
Very fertile,
Who balance
All her books.

Tell her
To stop drinking
Gin and tonic and Pimm’s.
Tell her
To sober up to reality
Tell her

To embrace
Her Foreign Kith and Kin.

Copyright © 2016. Tony Martin-Woods
Todos los derechos reservados. All rights reserved.

Painting: Happy unicorn and a naked virgin. Rothschild Canticles. Flanders 14th century. Beinecke Rare Book and Manuscript Library, MS 404, fol. 51r from  by Hieronymus Bosch (c. 1450-1516). Source: https://uk.pinterest.com/elenakarasiova/

 

Anochece que no es poco en Brexit

Day 2 in the Brexit House. Los medios y los televidentes hemos disfrutado de lo lindo. Seguro que los políticos no tanto.

 

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Boris Johnson, alcalde conservador de Londres, se ha convertido en todo un símbolo del brexismo. La naturalidad exultante de sus ademanes de niño rico travieso que se ha comido la caja de bombones a veces juega a su favor, a veces en su contra. Hoy las cámaras de todos los telediarios le han encontrado a Boris su lado rebelde: A la entrada de Westminster, los periodistas le atosigaban mientras él respondía con chascarrillos. Con su anorak, su bici, su mochila y su gorro del Metro de Londres, Boris se perfilaba tras las lentes mojadas de las cámaras que lo perseguían como un personaje atormentado. Sus tribulaciones: haber roto aún más su partido, enfrentarse a su amigo de la juventud David Cameron, ser acusado de egocéntrico que usa su postura poppulista para promoverse como sucesor de Cameron y haber contribuido al batacazo de la libra esterlina, que hoy alcanzó su mínimo de los últimos 7 años frente al dólar.

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Ya los asientos del Parlamento, desde un rincón del gallinero, rodeado de caras expectantes, lanzó su única pregunta al Primer Ministro, su amigo David Cameron, sobre la soberanía británica.

 

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En los labios del adolescente enfadado Boris se leyó muy claramente la palabra “rubbish” (basura) tras escuchar la respuesta.

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David Cameron ha sido la antítesis de Boris Johnson: nítido, bien peinado, elocuente, preparado para esta gran ocasión de Estado y hasta sarcástico, en su justa medida. Normalmente gris y sin filo, el Primer Ministro se crece ante la dificultad y puede brillar en su oratoria cuando realmente hace falta.

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También ha estado muy bien el líder de la Oposición, el laborista Jeremy Corbyn, que ha recordado que lo importante de Europa no es el acuerdo alcanzado por David Cameron, sino su potencial como espacio de cooperación y comercio. Ha reconocido la necesidad de mejorar la Unión, para que este al servicio de la gente. A pesar de la grosería de un diputado conservador que lo ha interrumpido, Corbyn ha estado a la altura de Cameron y ha demostrado sentido de Estado sin abandonar sus principios socialistas. Todo un ejemplo en Europa.

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Por último, la entrevista del genial Jon Snow, de Channel 4, en las afueras del Parlamento, a la Secretaria de Estado de Empresas, Anna Soubry, y a Nigel Farage, el polémico líder del partido brexista y anti-inmigración UKIP. Un cínico desaprensivo disfrazado de tío majo. Se me antojaba un duelo entre iguales, pero Soubry le ha dado un repaso bastante completo a Nigel Farage, cuyo machismo simpaticón de terciopelo no le funciona con mujeres hábiles. Soubry, con una astucia cautivadora, ha sabido plantear muy bien la entrevista y  ha dejado a Farage sin argumentos, hasta el punto de forzarlo a decir que ni siquiera quería para Gran Bretaña un estatus de Estado asociado con la UE como el que tienen Noruega y Suiza, que forman parte del Área Económica Europea. “Entonces ¿con quién estaremos aliados en Europa?”, preguntaba la Secretaria de Estado. “Con nadie. Nosotros solos. Independientes”, respondía Farage humillado. La mirada de Soubry merecería un párrafo aparte.

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Y es que la principal baza de los Unionistas, o “Remainers” (de “remain”, quedarse), es que la salida abriría un periodo de dos años de gran incertidumbre tras el cual se consumaría la separación y que nadie en absoluto puede predecir con un mínimo de rigor lo que sucedería con las exportaciones británicas, con la copiosa inversión exterior que recibe y en general con su situación geopolítica. Es muy triste que se tenga que polarizar la campaña entre los dos bandos conservadores: el de los nacionalistas románticos desinformados, que se creen que Gran Bretaña es la Hija de la Polla Roja y que serán de nuevo un imperio, como dice la canción de los Nikkis, y los pragmáticos civilizados que apelan a la incertidumbre económica para que nada, o muy poco, cambie en política. Hace falta ilusión por Europa, por una nueva Europa.

En fin, afortunadamente no es Brexit todo lo que reluce, más bien al contrario.

Boris’ Brexit

Boris Johnson joins Brexit. Most commentators attribute his decision to the need to assert himself in the race for the leadership of the Tory party against the Chancellor George Osborne, but nobody has reflected yet upon the true economic and political significance of Boris Johnson’s move. As the major of the city that harbours the biggest financial centre in the world, and a declared supporter of its financial industry, it would be have been inconceivable for him, and irresponsible, not to have, at least, gauged the mood amongst the leaders of the City’s institutions before making his mind up. Can anybody imagine a conservative major of London standing against the City of London?

In my view, Johnson’s support for Brexit needs to be interpreted in the light of one of the deals achieved last weekend by David Cameron in Brussels: The British Government will be able to object, and delay, the implementation of measures by Eurozone Governments on Monetary Union matters that affect the rest of members of the Union, but will have no right to veto them.

The ability to block Eurozone integration is something that the financial industry had defended for years and the British Government has tried its best to achieve. The Eurozone, as it has become evident following the Great Recession, requires a revamping of its institutional architecture and a more effective, and far more democratic, governance. There are a number of ideas, more or less developed as specific proposals, that could help the Eurozone to address the political and functional shortcomings of the Monetary Union, bringing prosperity and jobs to the Euro countries and, by extension, to the EU as a whole, including Britain. However, some of these ideas might reduce the ability of many London financial institutions to continue working in the way they have done since the European Monetary Union started. Additionally, the City could be affected by any agreement within the Eurozone that touches, directly or indirectly, upon the question of debt (our public and private debt, which is immense. Remember that in our new world order, money is just debt and debt is a powerful political tool. If you need proof of it, watch 4 Horsemen, Boom, Bust, Boom or read the latest work of any alternative economist).

So, in what way could many operators of the City of London benefit from Brexit? Britain’s departure would make the European Union far more unstable and force everybody to rethink their priorities; the question of regulating the activities of the institutions who brought about financial chaos in 2008 will be left in the back burner. Brexit would certainly bring monetary instability for the euro, and the pound, that many will be already betting for and benefiting from. The turmoil caused by the shock of a victory of the No Campaign would prevent the still immature Monetary Union to advance in the direction it needs.

One may argue that Brexit may be detrimental for the city (no capital) of London, but that would not be so much the case for its financial operators. Severing the links with the EU will no doubt force London-based institutions to redeploy parts of their operations in the continent before Brexit is consummated legally, but with state of art technology and the best paid lawyers, it would be easy to minimise the cost of any relocation. At the end of the day, money, as opposed to people, does not have any national feelings.

Meanwhile, it appears that the big industrial corporations of the U.K. are showing their desire for Britain to remain in the EU. Up to 80 of the FTSE100 companies are reported to support Britain’s membership of the EU. For them, the benefits of sharing a common market and being part of a greater economic entity in today’s world are indisputable. For them, migration has brought about the labour they needed to and migrants are seen as an asset, as they are net contributors to the economy who generate more taxation and more consumption. For them, there is no evidence whatsoever that Brexit would generate more investment and more trade to the country. It is a big gamble. The EU “regulations” that so many people complain about would have to be complied with anyway if these corporations want to continue selling good and services to the continent. And, personally, I think Britain, as much as I love it, is one of the most regulating societies in the world. Leaving the EU would not liberate us from suffocating rules, nor make the rules better, believe me. Look at any other aspect of our life and society (Education is a good example) and tell me hand in heart if we don’t have too many rules, protocols, reports, procedures and measurements of our own creation that have nothing to do with the EU.

I am sure plenty of noble ideological and political reasons will be provided by Johnson justifying his stance in no time (today at 10.00 am in the Telegraph, apparently). Well-known anti-EU conservative discourse is widely available in the shelves of Tesco and other major suppliers in all colours and sizes. It is not that Boris does not have the capacity to elaborate his own narrative, but why bothering reinventing the wheel if the pre-packed patriotic democratic neo-romantic stuff is as good as any? Besides, loads of effort has been put in producing the arguments for Brexit by many politicians and commentators, including himself, over the years. Embracing the collective work, using the words and emotions that best resound in our hearts would bring Boris closer to the common man and woman and facilitate his harmonious contribution to the campaign.

However, no matter how appealing his arguments may appear to be, the decision of Boris Johnson to support Brexit reveals the widening gap between the real economy, the one that produces goods and services, which supports overwhelmingly EU membership, and the financial elites, who have decided to rock the boat, using the British people and sectors of the media as a proxy, in order to maintain and improve their position of dominance over States, industries and people across Europe.

Brexit: La división de la derecha

Hoy se ha anunciado la fecha del referéndum en el que los británicos deben decidir si Gran Bretaña abandona la UE o si permanece en ella, bajo las nuevas condiciones que el Primer Ministro conservador David Cameron ha conseguido extraerles al resto de Estados miembros. Será el 23 de junio de 2016.

Destacados miembros del Partido Conservador se han alineado en las dos campañas antagonistas, la del Sí y la del No, las cuales están a su vez divididas en diversas facciones.

Por un lado, dos pesos pesados del Partido Conservador, Michael Gove e Ian Duncan Smith, están desde ayer galvanizando a los numerosísimos militantes y cargos conservadores que reclaman la Brexit (Salida de Gran Bretaña de la UE). El poderoso grupo mediático de Rupert Murdoch y periódicos como el Daily Telegraph no sólo apoyan la Brexit, sino que han contribuido durante años a crear y difundir toda suerte de mitos sobre la UE que han calado profundamente en una gran parte de la sociedad. Los rebeldes conservadores compartirán campaña con el otro partido de la derecha, UKIP, que fue creado precisamente como respuesta anti-europea y anti-inmigración a la tibieza de los conservadores euro-pragmáticos.

Mientras tanto, David Cameron y su Chancellor of the Exchequer, George Osborne, defienden el Sí huyendo instintivamente de aventuras geopolíticas arriesgadas. Recuérdese que hasta Obama va a apoyar la permanencia del país en la UE y que una parte importante de las grandes empresas británicas, hasta un 80% según el Financial Times, va a hacer lo mismo.

El alcalde de Londres, el conservador Boris Johnson, se ha decantado públicamente esta tarde por la Brexit. Su decisión es tremendamente importante no sólo por el gran respeto del que goza en todo su partido y entre parte del público. El pronunciamiento de Johnson nos da una idea de la brecha abierta en la clase empresarial británica en torno a la cuestión europea. Como alcalde de la City of London, mayor centro financiero del mundo, es indudable que Johnson cuenta con el visto bueno de las “instituciones financieras” privadas. La escisión de la clase financiera con respecto a la élite industrial se hace cada vez más patente.

¿Y por qué a los poderes financieros les interesa apoyar la Brexit en estos momentos? David Cameron no ha conseguido en sus negociaciones del fin de semana pasado el derecho a veto de los países de fuera de la Eurozona a las decisiones que se tomen en el núcleo duro de la Unión Monetaria. Eso tiene implicaciones para el sector financiero británico. Tarde o temprano el Euro necesitará una arquitectura política e institucional más firme. Inevitablemente se ejercerán competencias en materias que afectarán a la primacía de Londres como centro financiero en la UE (y que le darían a Frankfurt, su rival continental, el señoreaje que demanda). Además, los intereses de los operadores londinenses, que en realidad carecen de nacionalidad, estarían también en juego si hubiera algún tipo de acuerdo en torno a la deuda entre los países de la Eurozona, lo cual sería posible también sin contar con Gran Bretaña. Por eso, una parte de la City of London, después de muchos años de ambigüedad silente, confirma ahora su órdago secesionista. La reformulación de la gobernanza del Euro aún no ha madurado, la salida de Gran Bretaña provocaría un gran choque que paralizaría la Unión y generaría incertidumbre en torno al euro y a la libra. Debilitar a los Estados es la estrategia de una deudocracia cuyos intereses se alejan cada vez más de los de la economía real.

La única conclusión esperanzadora de todo esto es la constatación, una vez más, de que el “Establishment” o clase dominante de un país no es un bloque homogéneo que actúa siempre con un propósito común. La izquierda en Europa debe aprender a entender y usar estas divisiones.