Europe’s globalists tackle the immigration class war

A few months ago, French president Emmanuel Macron launched a new policy platform to protect France’s lowest paid from foreign competition:

Emmanuel Macron warned Europe must accept the UK was crashing out of the bloc because of worries about foreign workers undercutting wages.

The intervention is a striking departure from EU rhetoric since Britain’s Brexit vote a year ago which has been dominated by demands for the EU’s principles to be defended.

Mr Macron used his first newspaper interviews since winning the Elysee to endorse tightening up rules on freedom of movement.

He told the Guardian:  ‘The great defenders of this ultra economically-liberal and unbalanced Europe – the UK – came crashing down on this.

‘What did Brexit play on? On workers from eastern Europe who came to take British jobs.

‘The defenders of the European Union lost because the British lower middle classes said: ”Stop!”’

Today he adds, via Reuters:

 French President Emmanuel Macron on Wednesday won the support of two eastern European states in his campaign against EU rules on the employment abroad of workers from low-pay countries, calling the current system a “betrayal” of European values.

Macron has pledged to overhaul a system under which “posted” workers can be sent to other European Union states on contracts that must guarantee the host country’s minimum wage, but under which taxes and social charges are paid in the home nation.

He says the system creates unfair competition in wealthier nations like France and Austria, a country that borders four eastern European countries and where on Wednesday he met Chancellor Christian Kern, an ally on this issue.

Interestingly, he is also trying to liberalise the labour market internally tackle high unemployment:

Protests planned this week against President Macron’s key employment law reforms have been given additional impetus after he appeared to suggest that French workers opposing them are simply lazy.

Critics seized upon the remark to describe Mr Macron, a former merchant banker, as arrogant and out of touch with the concerns of ordinary families. Unions hope the row will bolster tomorrow’s nationwide protest marches against the labour law package.

Mr Macron’s reforms are designed to weaken unions and to give new powers to employers. In a speech in Athens on Friday, he underlined his determination to drive through a package he sees as vital in the struggle to reduce unemployment from 9.5 per cent to 7 per cent over the next five years.

Across the pond, an analogous set of compromises is transpiring for the globalist of all globalists, Tony Blair, has also joined the rush, via The Guardian:

Tony Blair declared a “renewed sense of mission” to fight against Brexit on Sunday as he insisted Britain could impose tough new restrictions on immigration without leaving the EU.

In the first of a series of interventions he plans this autumn as Brexit talks intensify, the former prime minister’s Institute for Global Change has published a paper setting out a series of ways in which the UK could restrict immigration within existing EU free movement rules.

Speaking on BBC1’s The Andrew Marr Show, Blair said: “If, for example, the anxiety is downward pressure on wages as a result of an influx of EU migrants coming and doing work, say in the construction industry, we have it within our power to deal with that through domestic legislation.”

…“If we want to deal with those questions, we can deal with them without the sledgehammer that through Brexit destroys the EU migration that we’ll actually need,” he said.

Speaking as parliament prepares for a showdown over the EU withdrawal bill on Monday, Blair urged politicians sceptical about Brexit to voice their concerns publicly.

“Brexit is a distraction, not a solution, to the problems this country faces. If members of parliament really believe that, then their obligation is to set out solutions that deal with the actual communities and problems people have, and not do Brexit which is actually going to distract us from those solutions.”

The report published by Blair’s institute, which is written by the former Downing Street adviser Harvey Redgrave, suggests migrants could be asked to show they have a verifiable job offer before they can travel to Britain, and could lose the right to rent a home or claim benefits if they do not have the right to remain.

Like non-EU migrants, they could also face higher tuition fees at British universities.

It also points out that some EU countries such as Belgium have a tougher migration regime within the existing free movement rules, requiring new arrivals to register.

Blair’s proposals stop well short, however, of the crackdown recommended in a Home Office paper obtained by the Guardian last week, which suggested low-skilled workers would be unlikely to be allowed to stay for more than two years.

There is little doubt that Brexit is bad for the British economy. Customs costs alone are huge, via Politico:

The U.K. government faces a mammoth task to prepare the country for customs procedures after Brexit as 180,000 traders face making declarations for the first time, according to a new report from the Institute for Government think tank.

It says businesses face potential costs of between €4 billion and €9 billion, and there is little to indicate the U.K. will be ready to undertake a successful exit from the EU customs union.

Anyone that can remember pre-common market Britain will recall the gigantic queues that formed around the movement of goods and will understand this figure.

But there is no reason why limiting cheap foreign labour should hurt the economy. Indeed, it will be beneficial as it lifts pressure from wages and asset prices, helping domestic demand without damaging competitiveness. Companies will have to train, invest and automate instead, which will boost productivity.  On balance, the currency seems likely to be weaker as well as credit weakens.

Protecting the lowly paid needn’t damage the economy overall but it does change the relative winners and losers within it.

Of course, in Australia, the mortgage imbalance is now so large that a similar move to limit the flow of cheap foreign labour is likely to slow the economy before things improve again. But the correction of that imbalance is unavoidable anyway so we might as well get on with it before gets worse and our own political economy boil-over makes for bad policy decisions like Brexit.

Comments

  1. Anti-immigration is a popular game at present. There’s little else to explain a ‘centrist’ banker suddenly developing a conscience in regard to worker’s rights.

      • Absolutely, it makes complete sense. It is a major part of the solution.

        …although it’s a worn cliche to respond with the cynicism retort, I am extremely skeptical that Macron (the bankster parasite) is doing this for the good of the nation, and as such, am doubly doubtful that this is anything more than rhetoric.

      • I thought that the free movement of cheap foreign labour is a non-negotiable part of being an EU member. There is no baby and bath water scenario here – you either accept the position of the Troika (regardless of how bad it may be for your nations working class) or…….you accept the position of the Troika. It’s an entity that has shown zero willingness to compromise on anything. It has completely ignored the will of the citizenry of individual EU nations.

        The EU is a bit like an outlaw bikie gang in that if you start to have doubts as a member, you don;t just get to leave – they more or less own you. The first thing they do is take your bike then decide whether or not they’ll let you live. Britain will be made an example of in order to crush the dissent that has been bubbling away in southern Europe for the better part of a decade.

      • Overstating their power. They are white knuckling watching all this anti-immigration/anti-EU sentiment in member nations. They are not about to seize anyone’s bike…if anything, they’re about to offer them a new one. At the end of the day, if one of the major power’s, like France for instance, tells Brussels (Berlin) to go fuck itself, then there is exactly jack they can do about it, other than beg & whine. It is worth noting that if France started to push-back against Brussels, they would defacto have Italy with them. So 2 of the big 3 + Britain. They could strong arm little piss ant Greece, but they’ll find it different playing with the big boys.

  2. Tony Blair, before opening the borders, thought only 100,000 low-wage workers will come over. But 1 million came over!

    Wrong about WMD, wrong to declare “Corbyn is unelectable”, and wrong about how many low-wage immigrants will come over.

  3. Best political decision from a population in a long long time.
    Short to mid term yes it will hurt bizonoimically but if you think that the decision was made on the basis economic nirvana or at best neutrality it is not a politically accurate read of the result. (too much shrill guardian perhaps?)
    It was sovereignty (yes borders and polish plumbers are part of that) first and centre as lets face it there was almost no economic commentators that did not forecast a bizonomic Armageddon.

    • Not true edwin. The Leave campaign offered a range of scenarios that spanned from economically neutral to “unleashing” the full potential of the UK economy via free trade galore within a year of trigering it. Now tje best case scenario is being like now within a decade of leaving.

  4. Hole in your story “Companies will have to train, invest and automate instead, which will boost productivity.”
    companies dont have to do anything but sit on their hands till this ponzi with the population sorts its self out.
    Just a reminder, the housing market is bigger than the equities market in straya, when the housing market collapses the equities market will be dragged down too.
    the strategy for business now is to wait and watch.

  5. ceteris paribusMEMBER

    Hasn’t Blair already done enough damage for twenty life times. Same with Tony and Hillary Clinton. This infantile attention-seeking, coupled with the pious and grandiose nonsense they push, suggests both compulsion and desperation. How true those well-worn sayings. Know when to leave the party. Always leave them wanting more.

  6. The EU is an outgrowth of the post-war ECE and Common Market, essentially the world’s first multi-national FTA. From the Reuters article:
    “The single European market and the free movement of workers is not meant to create a race to the bottom in terms of social regulations” Macron told reporters.
    Echoes concerns expressed here in Australia, wrt our FTAs!

  7. At least Eastern Europeans are Europeans, with the same culture and values and educated (a part from the gipsies). The immigration from other unfriendly cultures is wellcome, but not the sameness from european neighbours. Politicians are idiots, morons.

  8. Putting an end to mass immigration to protect domestic wages sounds like good economics but it’s nothing of the sort. Quite the opposite.

    Low wages abroad spells the end of manufacturing jobs (apart from high tech) , which means that the only jobs you can protect are local ‘service’ jobs. However, we cannot get wealthier by cutting each other’s hair and mowing each other’s lawns, which is exactly what is being suggested by this policy. A country can only get wealthier by selling services/products to OTHER countries and at this point that amounts (from Straya’s perspective) to selling minerals and residential real estate to foreigners. As has been highlighted on this blog umpteeen times, that gig is likely to come to an abrupt end fairly soon.

    The truth is (and pollies are terrified of saying it publicly) is that real wages are heading lower for the foreseeable future and the professional sectors will not be spared either: lawyers, accountants, medicos etc. The winners (for a while) will be the higher paid Govt employees whose wages will be more ‘sticky’ but even they will have to bow to reality eventually.

    For wages to rise (in real terms) the cost of living has to become much cheaper but that will require some policy decisions that are way out to Leftfield at the moment, so no point holding your breath. The other way to generate higher wages is for productivity to rise but I wouldn’t hold your breath there either – the trend has been lower for quite some time. They (the pollies) will continue to try and ‘fix’ the problem guided by quack economic theories.

    • The other way to generate higher wages is for productivity to rise but I wouldn’t hold your breath there either – the trend has been lower for quite some time.

      This is a furphy. Productivity steadily increased for decades with little to no increase (decrease for some) in real wages because all the benefits haved accrued to the top few percent.

      The only thing that will raise real wages is returning bargaining power to labour, who have been robbed blind for the last thirty years.

      • You pay very little attention to the various articles published at MB despite being a member. Declining productivity is not a furphy. I’ve lost count of the number of times the decline in productivity has been mentioned on this blog. Anyhow, I guess if you’re so wedded to a particular view then all you need do is ignore the facts, hey ..

        “The only thing that will raise real wages is returning bargaining power to labour” — sounds like Britain in the ’70s. Golden years indeed 😉 That should solve the problem — labour gets a better deal prompting even more companies to get the fuck out of Dodge, then these same clowns wonder why there are no jobs left. You couldn’t make this shit up. Do you socialists not understand that you can’t mould the world into your vision of the way you’d like it to be? You cannot repeal the laws of economics just like you can’t repeal the laws of nature.

        The answer to a better deal for labour lies in getting rid of this fraudulent monetary system (fractional reserve), encouraging saving over endless debt-fuelled consumption and repealing the reams of onerous regulation which suffocate small and medium-sized businesses and benefit only large businesses and the army of public sector drones employed to write, administer and police it all.

      • You pay very little attention to the various articles published at MB despite being a member. Declining productivity is not a furphy.

        I am not saying that arguing productivity is declining is a furphy. I am saying the argument that increasing productivity will lead to increasing wages is a furphy, because for most of the last half century, it hasn’t.

        But this is just another example of doing everything in your head rather than looking at how the real world actually operates, so you’ll probably just insist that it’s reality which is wrong.

      • You’re extrapolating. A bit of solid theory to back this up is required. After all, correlation is not causation.

        Anyhow, I won’t argue.

      • Of course correlation is not causation by it’s pretty stark. Don’t like to argue much with “solid” theory because mainstream economics has a piss poor record on many matters, including this issue, over the last thirty or forty years.

      • Dominic, I agree it is not just about immigration. Immigration is just one side of the RE/spending Ponzi, and that works massive importation of capital that is firing it being the other, central culprit. The result is a long term over valuation of the dollar and killing our tradeables and outwardly exposed sectors, and narrowing the diversity and therefore economic flexibility of the economy. I presented the rather stark graph there to emphasize the point that concerns over immigration cannot be dismissed as it often is, and more recent studies seem to have been less positive about its supposed benefits than received wisdom would have it. I personally think that the success of the big post war immigration program in countries like Australia and Canada owed a considerable amount to a number of special circumstances at the time.

    • I generally agree with you Dominic. Alas governments in developed countries are pushing assets higher even as incomes stagnate or drop. The issue I feel is not sharing the pain of the adjustment amongst the whole of society in a fairer way, with Australia, Nz and the UK being the most egregious examples.

      • Jason, you hit the nail on the head right there, except it’s not governments pushing assets up (even if our own pollies are cheerleaders for NG, CGT discounts etc, which certainly assist). Asset price expansion is largely a direct consequence of monetary policy being too loose. Yes, you can argue that the RBA exists by virtue of statute and therefore the Govt is responsible to that extent but it really is all about cheap money. Cheap money (money available below what would otherwise be the natural rate of interest) is inflationary and is therefore the friend of asset owners and the enemy of the poorly paid or indeed anyone on a fixed income that isn’t insulated from money supply expansion.

        There is zero doubt in my mind that the ‘system’ has all the hallmarks of a ponzi scheme and I also have little doubt that we are in the final furlong right now wrt to this ponzi’s lifespan. The great shame is that the end of the ponzi will not be a time for Schadenfreude for the little guy – the consequences will be brutal for all concerned.

  9. ResearchtimeMEMBER

    How is getting out of Europe bad for the UK??? There are only two effective contributors – and one of them is leaving… moreover, lets look at the real reason, the German force majeure is that Britain will be crushed and will eventually come to heal, Britain talks about EU parliament that does not elect its top officials, cannot introduce legislation, cannot amend legislation – dictated by an appointed bureaucracy. Magna Carter and all that…

    Please show some considered thought before commenting – this isn’t about money, its about freedom. And there is a substantial body of evidence that the UK will be substantially better off under WTO rules. Eire won’t be too far behind either – I think its dawning on them, that this time they have to make a choice. And realistically, only one to make…

    • ResearchtimeMEMBER

      Good summary of EU self belief by AEP – Triumphant Brussels likens Brexit to the Third Reich (http://www.telegraph.co.uk/business/2017/09/08/triumphant-brussels-likens-brexit-third-reich/)

      So it has come to this. Brexit is now akin to the worst episodes of totalitarian mass murder in the 20th century.

      “EU policymakers and officials are returning to their desks with a spring in their step,” writes the Brussels think-tank, Friends of Europe, the high priests of EU orthodoxy.

      “This summer has seen the ‘Brexit effect’ quietly gathering momentum, so much so that it’s shaping into one of the most spectacular own-goals of European history, on a par with Germany’s Third Reich or the Russian Revolution.” All that is missing is Mao’s Great Leap Forward.

      Such is the febrile mood in Brussels. The note is illuminating on many levels, but the main thrust is a celebration of imperial might. “Negotiations with the UK are demonstrating the sheer power of the EU,” it says.

      “For a decade it had appeared flabby, struggling ineffectually with the eurozone’s difficulties and then with the migrant crisis. Now, the Brexit process is revealing the EU’s solidarity and its worth. It’s a lesson that isn’t wasted on the watching world.

      “Thanks to Brexit, the value of the European project is coming into full view. For the average European, the technical details of economic integration have been invisible to the naked eye. The European Union’s many virtues are being laid bare for all to see.”

      It has been a mission impossible for Brussels to explain the complexity of EU regulations or to sell EU’s daily diet of technical standards to the people. “Bizarrely, the UK government is performing exactly that feat. David Davis has had to backtrack on a lengthening list of issues. The most significant climb-down has been London’s grudging acceptance that EU law, and thus the rulings of the European Court, will continue to hold sway in Britain,” it said.

      Actually London has agreed no such thing, beyond a transition phase over limited issues, and even then the role of the ECJ may be ‘indirect’. But never mind.

      “That concession looks set to be followed in many other areas. Theresa May’s Government had previously been adamant about cutting connections and ‘taking back control’, yet on key questions like electronic data regulation and privacy the UK has advanced suggestions for maintaining links with Brussels.”

      So the desire for cooperative ties – stated long ago in Theresa May’s Lancaster House speech and at EU Council meetings – is capitulation. But again, never mind.

      The message is clear: Brexiteers betting that others would follow in a pan-EU domino effect have been confounded. So have those who thought UK withdrawal would shake the EU system to its foundations. Europe has regrouped. Its line is hardening. It is Britain that is now on its knees as the economy crumbles.

      It so happens that the piece is written by an old friend of mine, the group’s chairman Giles Merritt. His 2016 book ‘Slippery Slope: Europe’s Troubled Future” is a fine exploration of the EU’s own deep malaise. That even this wise owl should be in thrall to such hubris – some might say chest-thumping euro-nationalism – tells us what is in the Brussels water these days.

      Jeremy Browne, the City’s EU envoy, said that his conclusion after long talks across the Channel is that the EU is still treating Brexit as “primarily an internal disciplinary matter”, with little thought of anything beyond.

      As a ‘Gedankenexperiment’, imagine how we in Britain would have reacted if Scotland had voted to leave the UK. While saddened, I hope my reaction would have been to respect the legitimate wish of the Scottish people to run their own affairs and to bid them well, as would most Telegraph readers. I believe the British government would have bent over backwards to help the Scottish state.

      The EU sees Britain’s quest for independence in another light. Mr Browne says that beyond the crude reflex of punishment it is deeply divided and has no vision for any sort of long-term relationship. The UK is rebuked daily for lacking statecraft in these talks but the EU is arguably worse.

      Brussels faces an enveloping crisis in which Britain is leaving, relations with Turkey have collapsed, the enlargement process is finished, and Ukraine is in limbo. This cries out for a profound strategic review of its neighbourhood policy. What the EU should be doing is to work out how to deal with an outer ring of states that are not destined for “ever closer union”, yet wish to have close trading or military ties. So far we hear nothing beyond pedantic, legalistic, nitpicking. It has not risen to the new challenge.

      But I digress. The Friends of Europe paper wilfully misreads this year’s political events in the EU, as does the Brussels elite in general.

      The French elections in May were not a validation of the European project. Some 49pc voted for extreme parties or protest movements with a eurosceptic hue in the first round. The fact that Emmanuel Macron ultimately won does not conjure away this landscape. The Front National’s Marine Le Pen won 34pc (compared to 1.8pc for UKIP in June). Such a result was once unthinkable.

      Yes, the cyclical recovery since early 2016 has lifted spirits. Negative interest rates, $2 trillion of quantitative easing, and a fiscal mini-blitz, have belatedly rescued southern Europe from depression. To the extent that these countries have huge output gaps – after having been waterboarded by austerity overkill – they are now enjoying a mechanical ‘V’ shaped catch-up.

      But the European Central Bank will soon have to wind down QE, even though this will leave the Italian Treasury alone in the market trying to fund €400bn (£365bn) of debt each year. The 20pc gap in North-South competitiveness has not gone away. Germany is still running a corrosive and illegal current account surplus of 8.5pc of GDP with the complicity of Brussels, invariably craven on such matters.

      There is still no fiscal union, no debt union, and no shared banking liabilities. The German constitutional court has ruled that any serious move in such a direction would violate the Grundgesetz in any case. If there were a fiscal union – by some miracle – it would advance the EU project from its current state of authoritarian technocracy to outright tyranny.

      It would concentrate parliamentary powers to tax and spend in the hands the Eurogroup, a body that answers only to itself. Given the way that EMU officials toppled Greek and Italian prime ministers, forced the Irish state to swallow vast sums of junior bank debt to shield the European banking system, and secretly ordered changes to the Spanish constitution, I hate to think where this would go.

      Friends of Europe says that “once the British had embarked on the tortuous process of negotiating their departure, the disadvantages of leaving quickly became apparent”.

      What this really means is that it is extremely hard for a country to extract itself from the EU after forty years, ‘infantilised’ to the point where it no longer has trade treaties or control of its own nuclear industry. On that we can agree.

      Brexit has demonstrated to everybody what has happened over three decades of treaty-creep: the Single European Act, Maastricht, Amsterdam, Nice, and ultimately Lisbon. It has shown how close Britain has come to losing sovereignty altogether.

      Mr Merritt states that Brexit has made visible the once-hidden “virtues” of the EU. Yet what he mostly says is that the pain (allegedly) being suffered by Britain is becoming apparent to people across the EU.

      As a daily consumer of the European press I would agree that such a scarecrow effect is at work. Readers are subjected to a relentless barrage about what is happening in the UK that borders on fiction. German newspapers are particularly fond of the words ‘Katastrophe’ and ‘Kernschmelze’ (meltdown) in conjunction with Brexit.

      If that is your only source of information you might indeed think that Britain was in the grip of rampant pauperisation, and that wolves are on the loose among the abandoned towers of the Canary Wharf. For what it is worth, UK manufacturing growth in the third quarter is running slightly ahead of eurozone growth. Let’s keep it quiet.

      The decline in Europe’s eurosceptic parties has little to do with any re-found EU ‘virtues’: the operative word in this context is fear.

      I was recently reading the thoughts of Harvard anthropologist Michael Herzfeld, writing about Brexit from a mountain community in Crete. The villagers are flabbergasted that the British dared to take such a step.

      “These highly intelligent observers, some of whom have lived abroad, have experienced rough treatment from the European Union, for which, as for Greece’s leaders, they now have neither patience nor affection. They know about hard-bargaining and cannot see how any member state can realistically opt out,” he writes.

      “They already ‘know’ there is no real way out: as one man put it, their government said ‘No’ in the morning and ‘Yes’ in the evening – and the British government, he argued, will be forced to do likewise or suffer dire consequences.”

      The EU priesthood has certainly acquired a habit of overturning referenda by fair means or foul. “We have instruments of torture in the basement,” in the immortal words of Jean-Claude Juncker, the grand inquisitor.

      They reversed the Danish ‘No’ to Maastricht, and the Irish ‘No’ to Nice and Lisbon, and Dutch and French ‘No’ to the European Constitution (reinvented as Lisbon), and the Greek ‘Oxi’ in 2015.

      Now at last they face a referendum to be reckoned with. The old guard in Brussels is having great difficulty coming to terms with this novel experience. They will.

    • C’mon RT. Freedom, really? The privatisations and social cuts are 100% Westminster policy. Ditto with the red tape that stifles manufacturing. The UK has been in decline since WWI, so just accept it. You are has beens, former had-and-empire bunch, like Spain or France. Your spot is now being filled by the US (or at least it will if they keep going the same way) while China rises. El Gatopardo comes to mind…

      • ResearchtimeMEMBER

        Democracy is a great thing… you should read up on what the EU have been up to… it is, and will never be democratic institution…

Leave a reply

You must be logged in to post a comment. Log in now