Sergio Cesaratto – Democratic sovereignty and genuine internationalism

Sergio Cesaratto looks at why national sovereignity has been so easily hijacked by the right and and needs to be taken back by the left.

Sergio Cesaratto is Professor of Growth and Development Economics and of Monetary and Fiscal Policies in the European Monetary Union, University of Siena

Cross-posted from Politica & Economia Blog

Translated and edited by BRAVE NEW EUROPE

For many commentators the term “national sovereignty” has become synonymous with the most narrow-minded political sentiments: nationalism, racism, pseudo-leftism, neo-fascism. Perhaps we should introduce some distinctions into what appears to be an instrumentalisation aimed at putting very different political inspirations into the same cauldron. This fabricated confusion is rooted in the lack of solid arguments to challenge those who believe that full national sovereignty is a prerequisite for democracy and constructive international cooperation.

I have elsewhere termed the most recent historical phase a “Polanyi moment”, characterized by a widespread feeling of protest against the liberal elites. Far from considering the free market as a natural condition for humanity, the anthropologist Karl Polanyi (1886-1964) predicted that the brutal imposition of liberalism would generate a popular opposition aimed at reconstituting the community bonds violated by the market. If the creation of a “decommodified” Social State was a progressive response to which capitalism had to lend itself in the face of the Soviet challenge, Polanyi feared that popular protest could be led by the illiberal right, as had happened with Nazism, employing simple and reactionary slogans. With the Left orphan of socialism, the right-wing response risks appearing to be the only one available today, all the more so as the elites, including the left-wing, often treat the popular feeling of seeking protection against the harassment of the market and the dislocation of centres of power outside the borders of national democracies with contempt.

More than twenty years ago Massimo Pivetti, a senior post-Keynesian economist, had already begun to denounce how the reduction of control of the national democratic institutions over monetary sovereignty was part of a wider plan of undermining the nation State, which was considered a natural forum within which the distributive conflict between the social classes is exercised. Moreover, fixed exchange systems have been a traditional tool for regulating distribution conflicts. This is how it has been in Italy since 1979 when, under the inspiration of Beniamino Andreatta and his court of Bolognese professors, of economists at Bocconi in Milan and at the Bank of Italy, the import of German discipline became the axis of Italian economic policy. Without monetary policy and exchange rate fluctuations, the margins of fiscal policy become tighter; the electorate’s room for manoeuvre in the direction of economic policy is eroded; the room for social conflict, the breeding ground for democracy if properly regulated, dies. Democracy is reduced to the debate on civil rights, the privileged terrain of the current left, together with adherence to an indistinct cosmopolitan solidarity. But that is not all. A fiscal policy based on a “strong exchange rate” (a reminder of Mussolini’s “strong lira”) has led to the loss of external competitiveness, to the growth of the public debt-to-GDP ratio, to an infinite austerity that, by dampening aggregate demand, is at the root of stagnation in investment and productivity.

To think of a supranational federation between economically very different nations means to support this liberalist design, as Friedrich von Hayek (1899-1992), the champion of liberalism, well knew. He considered supranational institutions among dis-homogenous communities to be the Mecca of the liberalists, not the socialists. Political realism (that is, the lesson of Thucydides, Machiavelli, and Hobbes) leads us in fact to believe that in relations between States the word solidarity makes little sense, and is in fact rejected even by the working classes of the most affluent countries. In reality, the only possible federal Europe is the Ordoliberal Europe, which aims to impose market order by dismantling the barricades placed in the way after the Second World War by the nation states.  The illiberal right has well understood the bewilderment caused in the popular classes by the Euro-ordoliberal aggression, and uses it to its own advantage (emptying the protest of any genuine social value). The traditional Left has not understood this and preaches a solidarity that the people do not share, challenging the current Lega-M5S government on the subject of immigration (instead of pressing it on economic and social issues), and cheering for Brussels and the markets.

Currently in Italy there are two left-wing groups, of which the cardinal difference is the importance attached to the concept of sovereignty. Fortunately, many intellectuals are aligned with that  group of the Left, which stands for democratic, social and reformist sovereignty. It is therefore time for a new political formation to emerge which – in line with what is happening in other countries such as Germany – gathers the insecurity of vast sections of the population and the elaboration of these intellectuals, and which, with long-drawn-out political work, wrests the flag of the defence of national interests from the right and accelerates the inevitable irrelevance of the “compassionate Left”. What will unite these European forces will be genuine internationalism, aimed at restoring lost sovereignty to the peoples of the continent, outside supranational cages in which the law of the strongest prevails.


From Il Fatto quotidiano 22 8 2018. Thanks to G.Bergamini for his usual editorial help.


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