“No-Deal” Brexit: A nineteenth century solution that still works

by Jehu

A “no-deal” Brexit was always the only Brexit the UK had any chance to gain out of its fascist minded referendum. This is not just because the opponents of Brexit are in charge of the process, although they are; nor is it simply because the May government is incompetent, although it is.

The real reason a “no-deal” Brexit was inevitable is that Britain is looking for the same sort of deal with the European Union that it enjoyed with India up until 1948.

If Britain could dictate its relation with the EU and determine EU policies, its membership in the EU would not be a problem. The problem only emerges because the EU asserts in no uncertain terms that its rules apply to all members without exception.

This is unacceptable to Britain — Brits are special and deserve special rules that apply only to them.

Faced now with the prospects of a “no-deal” Brexit, the British establishment has collapsed into confusion. It appears there is no way out of its predicament, but this is not true. The British government need only borrow a couple of pages from its own history to resolve its current problems by adopting policies it first enacted in the 1800s: unilateral free trade and a sharp reduction in hours of labor.

In this era of radical anti-capitalism, when unilateral declarations of free trade might be dismissed as neoliberalism on steroids, you might wonder why borrowing a page from the locomotive-powered nineteenth century would work in the digital environment of the twenty-first century. Let me see if I can explain:

Free trade: Nearly everyone is familiar with the repeal of the Corn Laws in the mid-19th century. Yet few communists understand why this repeal worked for Britain and to the disadvantage of its competitors. Tariffs and other barriers to international trade raise the prices of commodities by relying on the output of less productive domestic firms. The difference between the prices of commodities in a protectionist regime and a free trade regime amount to a sort of rent made possible solely by the action of the state, but it also raises the so-called cost of labor power.

If this protectionist action on the part of the state is removed, prices tend to fall, profit margins are squeezed, and a portion of the domestic firms will be forced to invest in improved methods of production or be driven into bankruptcy. As can be seen, free trade policy works by increasing pressure on capitalist firms (by reducing prices and, therefore, profits) to improve their methods of production, by squeezing more surplus value from wage workers in less time.

Reduce hours of labor: A second method of reducing profits used in Britain in tandem with repeal of the corn laws was introduction of a ten hour limit on hours of labor. To enlist the working class in the struggle to repeal the corn laws, Karl Marx wrote, “the spokesmen and political leaders of the manufacturing class ordered a change of front and of speech towards the workpeople. They had entered upon the contest for the repeal of the Corn Laws, and needed the workers to help them to victory. They promised therefore, not only a double-sized loaf of bread, but the enactment of the Ten Hours’ Bill in the Free-trade millennium.”

This political tactic had far-reaching importance in securing Britain’s place as the undisputed world industrial leader. According to Marx, once limits were set on the length of hours of labor, capitalist firms were forced to introduce improved methods of production in order to squeeze more surplus value out of the working class in a shorter working day and raise the rate of profit. This had the effect of accelerating capitalist growth perhaps as much as five-fold in the following decades, as Marx details in chapter fifteen of Capital.

As can be inferred from Marx’s labor theory of value, the two measures work in tandem to place unprecedented pressure on capitalist profits. By imposing a free trade regime on domestic prices, profit margins are severely squeezed — this is the hammer on capitalist profits. By reducing the working day in tandem with free trade, the capitalists are prevented from transferring the impact of this profit squeeze onto the working class through wage reductions and layoffs — this is the anvil.

The result would be generally lower prices for commodities, more leisure time for the working class and higher wages, even as British industry is forced to become more competitive within the world market.

And — oh — let’s not forget that the policies have the added effect that by generally reducing hours of labor, Britain’s contribution to global climate change would be greatly reduced as well.


Postscript: The conservative rag, National Review, has rediscovered unilateral free trade as a solution to “no-deal” Brexit as well, but, of course, conveniently, they have managed to forget that free trade legislation was accompanied by a sharp reduction in hours of labor.