The aptly named – Corporate Europe Observatory (CEO) – “is a research and campaign group working to expose and challenge the privileged access and influence enjoyed by corporations and their lobby groups in EU policy making”. It is relentless in exposing the corporate scams that result in European Union laws being biased towards corporations at the expense of the well-being of the broader population. The research results they publish are diametrically opposed to the claims by the Europhile Left, especially those from Britain, that posit that the EU is the exemplar of global organisation, defending workers’ rights and all manner of good things, and with just a few reforms here and there is the hope for a progressive future. CEO’s most recent report (February 6, 2019) – Captured states: when EU governments are a channel for corporate interests – allow us to see how the EU machinery has turned the Member States into a “channel for corporate interests” – “middlemen for corporate interests”. My position is that CEO has it right and the Europhiles a dreaming.
The CEO takes no funding from the European Commission or other co-opted parties.
They are clear that:
Our strict funding policy rejects funding from the EU, governments, political parties and corporations in order to maintain the independence of our research.
This is a breath of fresh air in a world where stacks of so-called ‘independent’ think tanks which research European matters accept cash from the bodies they investigate.
In 2018, CEO with some of its NGO allies “submitted freedom of information requests to 19 permanent representations in Brussels to obtain information about the extent of their contacts with lobbyists”.
They found that:
Only two member states both stored and released full data on lobbying: Romania and the Netherlands. Ireland only released the data relating to meetings with their Permanent Representative and Deputy, not lower officials. No other permanent representation released the data requested.
Which should tell you a lot.
The ‘Permanent Representation’ represents the interests of the EU Member States to the European Commission in Brussels. Each nation, typically, has a huge number of workers across all their government departments, in the Permanent Representation.
They wine and dine representatives from other EU Member States, the Commission and members of the European Parliament.
The Permanent Representations feed into all the major EU institutions – the Council of the EU and its rotating Presidency, the European Council, the Committees of the EU.
The collated – Data for Permanent Representations’ lobbying – collected by the CEO researchers reveals how these “permanent representations are a major target for corporate lobbyists”.
The corporate lobbyists work like beavers in Brussels to ensure the lower level officials of each Member State are on the same page and acting in the interests of the corporations.
CEO’s research shows that “when corporate interests win, the public interest loses out”.
They document the lobbyists that are active – “Volkswagen and Telefónica … the finance industry … coal industry … chemicals …”
Importantly, the lobbying and their influences on “EU decision-making are shrouded in secrecy and not commonly studied.”
The ‘Captured States’ report provides rare insights into the perversion of EU decision making and should make the Europhile progressives wince with embarrassment, knowing that they hold the EU out as something worth supporting.
Whatever the origins of the European Union (and I analysed that in detail in my 2015 book – Eurozone Dystopia: Groupthink and Denial on a Grand Scale), the modern incarnation of the Union is neoliberal central.
Neoliberalism is built into the Treaties. It is a core aspect of the Union not something around the edges that can be dispensed with and then we move on to utopia.
The so-called “democratic deficit” in the European Union, often denied by Europhiles, arises not because of lobbying behaviour, but because only narrow interests are served by this behaviour.
The money involved in maintaining missions in Brussels or venturing to Brussels means that organisations that might represent the interests of the poor and the fragile, and who are typically cash-strapped, are absent.
The CEO Report call this a:
… a massive asymmetry of influence on member states’ EU decision- making as civil society groups cannot match the privileged access and far greater lobbying capacity and resources of the corporate sector.
They also point to the basic architecture of the European Union as creating an organisation structure that engenders this type of capture.
1. “Elite corporate lobbies target the European Council of member state leaders, with access that NGOs and trade unions cannot match. For example the regular meetings of the European Round Table of Industrialists bring together 50 bosses of major European multinational companies with the leaders of France, Germany, and the Commission President.”
2. “Rotating presidencies of the Council of the EU provide a key target for corporate lobbies … corporate sponsorship of rotating presidencies now appears to be standard”.
3. “The EU’s complex and opaque committee structure benefits corporate lobbies with the resources and capacity to influence the final outcomes.”
4. “Brussels-based lobby consultancy firms provide specific services to corporate lobbies aimed at influencing member states” – so-called ‘lobby forums’ abound.
5. Data shows, for example, that 73 per cent of the meetings held by the Dutch Permanent Representation’s officials were with corporate interests “and only 15 per cent with NGOs or trade unions”.
The point is that to clean excessive access and influence requires root-and-branch changes – meaning the EU has to be abandoned in its current form and reconstructed as an intergovernmental agreement should the nation states determine there is a need for that level of cooperation.
Progressive reforms mooted such as an European unemployment insurance scheme will do nothing at all to change this endemic cancer.
The fact that the progressives want to just tinker around the edges must seem like gold to the corporate interests who have captured the EU decision-making structures.
As long as the progressives ‘count the number of socks in their drawers’ they are not focusing on the main game.
And the fact that the Europhile progressives are so wedded to maintaining the EU architecture means they will never challenge the basic structure that nurtures the neoliberal capture.
So the corporations go about their merry way and the democratic deficit widens.
That is the EU reality in 2019 and has been so for some decades now.
No nation should desire to be part of that neoliberal miasma.
The CEO Report shows that the neoliberal ‘cancer’ has worked it way into basic EU narratives:
Member states and national corporate lobbies have developed a symbiotic relationship whereby the national corporate interest has – wholly wrongly – become synonymous with the national public interest as presented by the relevant government in EU fora. Extreme examples include the influence of the car industry on the German political establishment (and the negative impact of this on EU climate and emissions’ regulations); Spanish telecoms giant Telefónica, whose closeness to the Spanish Government ensured its demands were absorbed and promoted; the state-owned coal industry which leads the Polish Government to be such a climate pariah; and the City of London, which can count on the UK Government to back its demands for the lowest possible financial regulation.
In the case of Britain, the myths surrounding the ‘City’ abound and we regularly see Project Fear reports of this bank or that bank leaving London for some continental destination because of Brexit.
It would be hilarious if not for the fact that Brexit is fracturing British society and making it harder for the Labour Party to make progress.
Although I would say that when we read Tweets from John McDonnell like that below, you have to think that British Labour is well qualified to lay out its own plank and walk it at the same time!
The ‘City’ shuffles wealth and very little of that shuffling has anything to do with the material aspirations and outcomes of the vast majority of British people.
Even if it was true that Brexit forces mass evacuations to ‘Europe’ of the financial sector players in London (and it isn’t), no person on ‘main-street’ would blink much at all.
One of the ways that the elites perpetuate their dominance is to convince everyone that they are indispensable.
They are not and progressives should work that out sooner rather than later.
We see that sort of delusion in the ‘Tax the Rich to pay for Services’ narrative that many progressives (see Tweet above) mouth daily.
They rail about neoliberalism but have become mouths for it.
In the same way that the EU Member States have become agents for the corporations at the expense of the citizens.
The CEO Report states the obvious:
… member states have collectively absorbed some corporate agendas and adopted them as part of the EU-wide agenda, such as on economic governance (strict fiscal rules and austerity) and investors’ protection in trade treaties (allowing corporations to sue states for billions in compensation when governments act to protect their people and the planet).
A lot of Remain progressives in Britain like to shout at people something like – name one EU rule or law that constrains behaviour in Britain.
Of course, most people cannot name many if any – which is no surprise given the opacity of all these matters.
But what being part of the EU means is that the corporations are privileged by the so-called ‘investor-dispute mechanisms’ that are inbuilt into EU law.
What that means is that the British government can be tied up in litigation and overruled by foreign courts if it dares to introduce legislation that the corporate interests feel impinges on their profitability.
Brexit means that the British government will be able to escape that sort of neoliberal tyranny – should it have the will.
The CEO Report also find that:
1. “A number of commissioners from the Juncker Commission appear to have a bias towards corporate interests from their own member states”.
2. ” Complex EU decision-making procedures, a lack of transparency, exclusion of citizens in decision-making at national level on EU matters, and generally weak national parliamentary mechanisms, have combined to create an accountability and democratic deficit”.
The problem is that the ‘blame the Commission’ narrative misses the point that the structure of the EU provides for extensive involvement of the Member States – “governments set the EU’s strategic direction, are closely involved in both the drafting and implementation of EU rules, and have final sign-off on all EU legislation”.
The corporate lobbyists understand that better than anyone and have invested millions to target the Permanent Representations. They know that if they can co-opt the Representations, they will co-opt European law.
The CEO Report conclude that:
The risk of corporate capture of some member states, on some EU dossiers, is very high, undermining democracy and the public interest. And it is getting worse.
The CEO report recommends:
1. “Member state governments must adopt national rules and cultures which reduce the risk of corporate influence”.
2. “Member state parliamentary scrutiny and accountability on government decision-making at EU level must be strengthened.”
4. New models!
And Bill adds – scrap the whole thing and start again.
And Brexit …
There is some Twitter back and forth (I minimise my involvement) about Brexit – particularly, whether I still maintain that a no deal Brexit is a superior option.
The answer is Yes – but as regular readers will know – my position has always been conditional.
If you trace through my several blog posts on the topic dating back to June 2016 with these blog posts:
1. Britain should exit the European Union (June 22, 2016).
2. Why the Leave victory is a great outcome (June 27, 2016).
and then several more, you will find no uncertainty or wavering in my view.
First, I have provided several examples of how the Project Fear predictions of immediate collapse were unfounded and just blatant lying.
That includes the predictions from the vast majority of professional economists working within the Academy and institutions such as HM Treasury and the Bank of England. They all got it wrong.
Second, my assessment that Brexit was the superior option has always been conditional.
In my immediate post-Referendum blog post – Why the Leave victory is a great outcome (June 27, 2016) – I wrote:
… the choice will not free Britain from neo-liberalism but it does bring the debate back into focus – voter face to face with the British politicians.
There are no guarantees that the decision to leave the European Union will lead to good outcomes, by which I mean help those who have been disenfranchised by the neo-liberal system.
There are scenarios that would lead to the conclusion that exactly the opposite might occur. Indeed, UKIP has every right to claim it ‘won’ and to further pursue its racist plans.
And the right-wing Tories who have always hated Europe might push for even greater ‘competition’ and cuts to government spending and services, which would further undermine the fortunes of the weak and precarious.
Bosses might push for further cuts to wages and conditions.
And I wrote:
When I tweeted it was a ‘great outcome’ I didn’t say that good would come out of it. I also didn’t suggest that it would be a short-term recovery of prosperity or that the workers would benefit.
I was referring to the fact that class struggle now has a clearer focus within the British political debate. There is now a dynamic for a truly progressive leadership to emerge and bring the disenfranchised along with them and wipe out the neo-liberal hydra once and for all.
That is why the Brexit vote is excellent. British politics is now in chaos. How it sorts itself out will determine what the outcome leads to.
But progressive leadership now has space to challenge the orthodoxy. That is a great outcome.
It might take time to emerge and crystallise. But class struggle does not yield instant rewards.
But I see the Brexit choice as one of those monumental outcomes similar to the OPEC oil crises in the early 1970s that change the course of history. I do not need to remind anyone that the Monetarists exploited the OPEC chaos to capture undeserved credibility and pursue the neo-liberal agenda.
So always conditional.
Since then I have consistently indicated that Brexit could turn out to be a disaster for Britain. But it won’t be because it leaves the European Union.
It will be because it maintains the neoliberalism of the EU and consolidates that within its newly freed legislative remit.
All the Project Fear claims about trucks being stranded, soccer teams not able to get players, cancer rates rising, shops running out of food and all the rest of it are pure lies.
I also don’t think it is in the interests of Britain to let the EU dominate the withdrawal agreement. The sort of outcomes that appear to be forthcoming from that process are inferior to a No Deal Brexit. I maintain that position.
Britain should tell the EU what it is going to do and leave it at that.
While the neoliberal bullies in the EU will make threats about closing borders to trade etc, the Bavarian motor vehicle manufacturers, for example, will ensure (through the corporate lobbying exposed by the CEO Report) that the German government and then its influence on the European Commission etc, will not fulfill those threats.
They know they have a lot to lose if Brussels was to play politics with a Britain intent on leaving without pernicious agreements.
And assessing that Brexit in the short-run might cause disruption does not mean it will be an inferior option in the longer term, once British politics reorients itself away form the EU capture.
And, I realise that as an Australian living away from Europe, I have no particular ‘skin’ in the game other than my overall global concern for humanity.
I am sympathetic to those caught up in the Brexit imbroglio.
But attacking me because of that misunderstands the role of an intellectual. As an academic, I have a responsibility to bring knowledge to public debates to ensure they are evidence-based.
I have spent years studying Europe and I would suspect I understand the situation there as well as most. I never write about topics I do not feel qualified to comment.
Which is one reason I haven’t written about Venezuela, for example. I am doing on-going research on that topic to bring myself up to speed on the history, culture, politics and economics of that situation.
It is also odd, that the ‘you don’t live here’ argument is made by so-called ‘internationalists’ who extol the desire to create cosmopolitan unities that span the borders of nation states.
The CEO Report is just another contribution that tells us how sick the EU has become.
While the authors think that some changes at the Member State level can retrieve the situation, I am less convinced.
The neoliberalism of the EU is core. The whole house has to be torn down, the block cleared, and new foundations laid.
Book launch – Macroeconomics textbook – London, March 1, 2019
We are launching our new textbook – Macroeconomics – in London on March 1. I will be attending the launch.
I have been told the event has ‘sold out’ – there were limited spaces given the venue.
I have, however, asked Macmillan if they can find a larger venue in Central London, given the number of people that have contacted me who want to attend but cannot.
I will keep you notified if there is any change in venue and arrangements.
There is also a – Resource Site – that will be growing as we add material.
I am also working on a series of videos to supplement the book.
That is enough for today!
(c) Copyright 2019 William Mitchell. All Rights Reserved.