Which way is the “Third Way”? (1998)

Editorial from the September 1998 issue of the Socialist Standard

According to figures released last month, Britain’s economy is moving away from its EU “partners” and towards the US. The Guardian, reporting on the figures provided by Eurostat—the official statistical arm of the EU—pointed out that the US in 1997 invested twice as much in Britain as in the rest of the EU and that two-thirds of all EU investment in the US came from Britain. As a result “it is more integrated into the global economy than the rest of Europe” (5 August).

Indeed, as the pro and anti factions of the capitalist class declare their hands, this can only give succour to the “Eurosceptics'” case that Britain’s future lies outside any further European integration and particularly the single European currency.

So where does this leave the Blair administration? Although Britain is definitely out of the first wave of entrants, New Labour has been clearly indicating an intention to join the Euro “when it is prudent to do so”. This is a subtle yet significant shift from the “wait-and-see” policy followed by John Major. This could be a dangerous strategy bearing in mind the popular prejudice against the Euro and the possibility of the Sun newspaper turning against the government. Couple this with the looming recession and Blair’s toothy smile may start to fade.

Of all the EU states, the capitalist class in Britain is the most divided on this crucial question. Broadly speaking, the Confederation of British Industry (CBI), British Chambers of Commerce and much of the City are in the “YES” camp, whilst the Institute of Directors and the Federation of Small Businesses are in the “NO” camp. One may conclude from this that the bulk of big export manufacturers plus high finance see the “Euro Zone” as something they cannot afford to miss out on.

Commentators are however pointing out that Britain is the “odd man out” in Europe when it comes to economic policy. Whereas most of the other EU states see no possible alternatives than allying themselves with any Franco-German axis, the same is not the case for Britain. For two decades at least Britain’s free market supply-side approach has been nearer to that of the US than the corporatist “social model” that has been built up in the EU . Of course, Blair’s latest contribution to economy theory is the “third way”-between the US and EU approaches. That this is meaningless drivel and demonstrates Britain’s confusion is obvious.

But what of the working class? We have no interest in taking sides on this capitalist question. Whether or not Britain signs up to the Euro is an irrelevancy. Our interest lies in pursuing the class struggle and forging our own class agenda. Neither Washington nor Brussels but global socialism.