The Portuguese Socialist Party sweep to victory but is this the end of their economic insurgence?

Three days ago, Portugal’s Socialist party (PS) won a huge mandate in their general election. Antonio Costa’s party won 36.6% of the vote winning 106 seats in their Parliament. Portugal stands alone in Europe as a place where progressive politics are hugely dominant. PS will most likely head into government with Left Bloc or CDU support.

Not only are their socialists about to enter their 2nd term in power they remain one of the few nations that uses proportional representation to have zero far right presence in their parliament. This success story can be traced to the hugely impressive economic recovery the government engineered.

However, with the Socialist Party gaining more power, oddly this may mean the end of radical political vision. Portugal’s economic recovery can be traced from the left-wing coalition that has ruled the country since the General Election in 2014. PS came 2nd but entered government with the left bloc and Portuguese communist party following years of austerity after a bailout. Portugal was one of the worst sufferers post the financial crash.

The conservative Portuguese Social Democratic party embraced austerity, CTT, public mail company and REN, national electric network, freezing public sector pay and raising regressive taxes like VAT. Education got a 23 per cent spending cut, and health and social security went the same way.

The result was 17.5 per cent unemployment in 2013, a 41 per cent jump in company bankruptcies and year after year of net economic decline.

The left took on the gauntlet in 2015 imposing a Keynesian approach to the economic crisis that many were highly sceptical of. PS enacted a reversal of the majority of the cuts while regaining this revenue from taxes on the richest.

The Troika reforms enacted by the previous government were overturned, a 30% increase in spending, while increasing the minimum wage, reversing VAT rises and reintroducing scrapped holidays.

They funded this by adding tax brackets at the top of the income scale while introducing taxes on sugar and increasing it on other luxuries.

The program has proven to be nothing less than brilliant. The economy has grown in every year since they took and Portugal’s economic growth was higher than the EU average in recent years, 2.4 percent in 2018, while unemployment rates fell to the level before the debt crisis.

Miraculously this has been achieved while reducing the deficit which is now almost zero, a historic low. However, this is unsurprising as tax has been levelled on those with the greatest ability to pay. This means spending is retained in the economy while tax take is not decreased. The economic program was designed eloquently to grow the economy and use this growth to reduce the public deficit.

However, such economic quality may be lost due to PS’s large win. A significant number of the policies that have been critical in Portugal’s recovery were only implemented due to their need for support from the 2 far left parties. 

The Left Bloc have struggled to increase their vote share in line with PS. They pushed for more infrastructure spending as well as a nationalisation program. Speaking to Joana Ramiro, a Portuguese journalist, she expressed her dissatisfaction with PS’s progressive credentials.

She said: “Calls for the re-nationalisation of main services, like those lead by the Labour Party, are something PS won’t hear a word of.”

PS’s current manifesto wants to keep the deficit low with controlled spending, but will increase public investment in the national health system and in transport system. This is on top of raising pensions and the minimum wage.

Many on Portugal’s left say this does not go nearly far enough to repair their struggling public services and run-down infrastructure. Their coalition partners may make this more progressive but at present PS offer run of the mill social democracy.

However, the left’s economic program over the last 5 years has helped PS gain a comfortable mandate for governing. While they may not be pushing the edges of radical reform, they show the EU’s left that rejecting austerity is key to winning back support.

History And The Resilience Of The Cooperative Model

The first cooperative in Italy was established in 1854 in Turin, as part of a wave of liberal reformism. As the movement grew, it split into two branches: the socialist branch that was stronger in the North and more focused on worker and consumer cooperatives, and the Catholic branch that was stronger in the South and more focused on agricultural and financial cooperatives. The movement grew to play a vital role in the Italian economy. For example, in 1919 the biggest port in the country was operated as a worker owned cooperative.Cooperatives, especially those of the socialist tradition, faced suppression by the Fascist regime and were deemed as cesspools of opposition activities. People were imprisoned, properties were destroyed, and central organizations were put under strict control of the dictatorship. 

After the war, cooperatives grew gradually alongside an economic boom that lasted until the 1970s. However, as the rest of the economy started to slow down, cooperatives continued their growth. The share of employment in cooperatives has more than tripled since the 1970s, reaching around 7% in 2018. The model, sometimes branded as old fashioned and suitable mostly for agriculture, turned out to be superior in adapting to the modern economy. 

Below are three facts that demonstrate the resilience of the cooperative business model in Italy:

Social Cooperatives

In the 1980s Italy saw two new type of cooperatives emerge; ones that provided social, health and educational services and ones that created jobs for disadvantaged people, so-called work integration social cooperatives. These two types of so called ‘social cooperatives’ were given a legal framework in 1991. The following decade saw this sector boom, with a five-fold increase in the number of people employed in social cooperatives, reaching 149,000 people in 2001. 

With the aging population and the growing share of employment in the care sector, Italy is spearheading what might be one of the most revolutionary transformations in the labour market – giving ownership of the care providers democratically to those receiving and giving the care. The technological advancement is a trend that makes it harder to employ disabled and low-skilled workers, which is also a question these cooperatives are addressing with great success. Below are two facts about the sector, one for both types of the social cooperatives:

Worker owned cooperatives

Italy has over 25,000 worker owned cooperatives, more than any other country in the world. To put this into perspective, the US only has 650, although the population is more than 5 times that of Italy’s. Two facts below show some of the social benefits that these sort of businesses have, as well as an example of what kind of legislation Italy has in place to support the sector.

Retail cooperatives

The largest retailer in Italy is a cooperative, simply called ‘Coop’. It has been at the forefront of ethical retailing, becoming the first European company to adopt the S A8000 Standard which is the only international standard valid for all sectors that can be certified by an external entity and ensures the ethical behaviour of companies and of the production chain towards workers. It was also the first Italian retailer to introduce FairTrade products. 

Below is an example of a project it has supported to help post-conflict areas in other countries:

Emilio Romagno – The world capital of worker owned cooperatives

Emilio Romagno is an area in Northern Italy that has one of the highest median income in all of Italy and it also ranks on top in various indicators of social well-being. The region also has the highest propensity to export in the country. 

The region also has perhaps the highest ‘social capital’ (a term that refers to intensity of interpersonal relationships, trust, cooperation and reciprocity) in the developed world, according to Robert Putnam, who has coined the term and is the leading researcher on the subject. This was measured by surveys that explored, for example, how often people take part in volunteering activities and how well they know their neighbours.
Around 30% of the GDP of the area is produced by worker cooperatives, making it the most worker cooperative based economy of its size in the world.

The Future

The movement is coming full circle, as its socialist and catholic traditions are gradually joining together.

Only the imagination sets limits to the opportunities of the future, and one of the most brilliant platform cooperatives, FairBnB coop is based in Emilio Romagno. It is a cooperative alternative to Air BnB that seeks to become co-owned by the hosts and guests. Instead of taking a commission that goes to the shareholders, the cooperative will donate to local projects of the members’ choice, such as public gardens or historical conservation. It is a straightforward example of a vision we at Coop Exchange embrace – a sharing economy where the ownership is shared. Air BnB faces opposition by the residents of areas that are very popular on the platform, but a cooperative alternative that would contribute to the betterment of the local area would surely be welcomed more positively. Whereas Air BnB enters an area and operates there until pressure from the public forces politicians to regulate it, Fair BnB will seek to help the public and contribute, not extract, value from the communities it operates in. We warmly recommend everyone to enlist their interest in the cooperative on their website

Emilio Romagno has the potential to become the centre of a great transformation of the start up culture towards crowdfunded, user-owned platform cooperatives. It has the potential to not only be the driving force of lifting Italy out of its economic problems, but also become the center of a distinct European tech sector that can rival that of China and the US.

European Elections 2019: Yorkshire Independence Party gains more votes than Change UK in Yorkshire

In the 2019 European Elections, the results of which were released last night, the Yorkshire Party has achieved a higher share of the vote in the Yorkshire region than the nationally-based Change UK Party.

The Yorkshire Party, known for their political goal of campaigning for the government to grant Yorkshire the ability to form it’s own provincial government within the UK, was formed in 2014, and has seen its best turnout of any election so far last night.

Stated on the Party’s website, the group aims to petition the government to treat Yorkshire with the same level of political freedom as Scotland, Wales, and Northern Ireland, all of which have their own inner Parliament as well as contributing Ministers of Parliament to Westminster in general elections.

On the other side, the Change UK Party was formed earlier this year after a loose coalition of Labour and Conservative Ministers of Parliament broke away from their respective establishment Parties due to their stances on Brexit, and originally went by the moniker of “The Independent Group”.

The Party ran with a number of candidates in every region of the United Kingdom, but failed to secure a single candidate as a Minister for European Parliament in the election, gaining barely 2.9% of the popular vote.

In Yorkshire and Humber specifically, however, the Yorkshire Party gained over 53,000 votes, compared to Change UK’s 30,162, which amounted to around 4% of the vote in the region compared to Change UK’s 2.3% of the vote.

The Yorkshire Party’s share of the popular vote was also nearly on par with the United Kingdom Independence Party’s share, with the Party losing all of their MEP seats both in the Yorkshire region itself and nationally last night.

Due to the nature of the European Elections, with a considerable majority of parties pushing a “protest vote” such as the Brexit Party, the Liberal Democrats, the Green Party, and Change UK all forming their election campaigns around their Party’s views on whether to remain or leave the European Union on October 31st, it can be implied that more residents around the Yorkshire and Humber area wish to see a devolved Yorkshire than would support Change UK’s campaign to remain in the European Parliament.

However, the Yorkshire and Humber area did see a considerable number of it’s residents back other remain parties, and the Liberal Democrat Party gained 15.5% of the popular vote, and the Green Party also secured 12.9% of the voter share. The Liberal Democrat Party was narrowly beaten by the Labour Party however, who held onto 16.3% of the voter share for that region, despite losing over 13% of voters to the other Parties when compared to the 2014 elections. All 3 parties gained 1 MEP seat each for the region.

On the official Yorkshire Party’s social media account, the Party asked whether or not this means the Yorkshire Party, and the Party’s prevailing lobbying message to the government, will be given more media coverage than Change UK, in light of Change UK’s disastrous night and the Yorkshire Party’s relative success in this year’s elections.

Investment firm Goldman Sachs increases No-deal probability forecast by a third

The multinational investment firm Goldman Sachs has increased it’s prediction for the probability for a no-deal Brexit by a third, to 15%, following Prime Minister Theresa May’s resignation announcement yesterday.

The firm had previously predicted a 10% likelihood of the United Kingdom crashing out of the European Union without a deal, however due to recent election successes believed to be accrued by the Euro-sceptic Brexit Party, and the possibility of a hard-Brexit supporting Prime Minister at Number 10 by mid-June, Goldman Sachs has since revised their estimate.

The probability of no-deal is now as high as the estimate was in April earlier this year, when the probability was cut due to the extension of article 50 by Theresa May’s Government to free up more time to work out a formal withdrawal agreement, of which 3 versions of said agreement were put before Parliament and subsequently rejected. 

An Economist for Goldman Sachs, Adrian Paul, has stated that the firm still expects an “orderly EU withdrawal in late 2019 or early 2020”, but that the organisation’s “conviction” is lowered due to recent events. 

Brexit predictions were thrown into disarray yesterday as Prime Minister Theresa May announced that she would be resigning from the role as soon as the middle of next month, and that processes to elect a new leader of the Conservative Party are to begin next week.

Many are placing current Backbench MP Boris Johnson, who has a considerable popularity within the party’s more radical elements for his support for a hard-Brexit, as the most likely candidate to score enough points within the Conservative membership base to be elected as the next Prime Minister. 

This has prompted a civil war within the Conservative Government, as many prominent Ministers of Parliament have either come out in support, or in direct opposition with the potential Prime Minister. 

Mr Paul also clarified that while it was unlikely for the current Parliament to push forward a popular no-deal vote the performance of the Brexit Party, and the potential for having a Hard-Brexit supporting Prime Minister, opens up the possibility for a second referendum vote to have the option of including a choice of “no-deal” on the ballot for the public to decide, which would drastically increase the odds that the United Kingdom, emboldened by a popular vote, would crash out of the European Union onto World Trade Organisation terms. 

Why the Eurovision Song Contest will never be apolitical

 

It’s that time of year again where Europe comes together for the Eurovision Song Contest, an annual singing competition which pits the majority of Europe (and Australia) against each other for the title.

Eurovision is supposed to be a non-political event. Under European Broadcasting Union (EBU) broadcasting rules, the Eurovision Song Contest ‘shall in no case be politicized and/or instrumentalized’. European broadcasters have to ensure that ‘No messages promoting any organization, institution, political cause’ can occur throughout the entire competition. Otherwise, the country faces disqualification.

But how realistic is this? Can Eurovision remain apolitical (or, perhaps, has it ever actually been apolitical?).

As you may or may not know, this year’s Eurovision Song Contest has come under close scrutiny. After Israeli artist Netta won the competition in 2018, many have used the event to voice their outrage against the Israeli government and its treatment of Palestinians.

In January, a number of British figures signed a letter which called for the BBC to cancel the coverage of this year’s contest. Signatories included Vivienne Westwood, Maxine Peake and the band Wolf Alice. In response, Stephen Fry and Sharon Osbourne were two figures to respond, signing a letter which reminded that Eurovision was about the “spirit of togetherness” and stressed that a cultural boycott was “not the answer”.

From this, one must question why there is such a fuss over the coverage of a singing competition.

To begin with, the song contest is a staple European event which has run for over 60 years. Whilst its importance in the UK has deteriorated over the years, its popularity with other European countries has continued to grow, and on average, at least one-quarter of Sweden’s population watch the final each year. With great popularity comes great attention – this is an event which has the eyes of millions across not only Europe, but the world.

But most importantly, whilst the show attempts to avoid any mention of party politics, the show itself is a political statement.

Firstly, this is a show which aims to bring countries together. The competition was established to bring together war-torn Europe in the 1950s – this message of ‘togetherness’ features heavily in each annual theme. That, in itself, contradicts EBU rulings because it is a political statement.

The message of ‘togetherness’ has also engulfed not only nationality, but gender, sexuality and race, which is here we see why Israel has come under criticism. Whilst some argue that Israel is the only country in the Middle East to accept homosexuality, others question how it can be an active member of the EBU when it disregards the recognition of Palestinians.

Acceptance of gender and sexuality has also been at the pinnacle of the show’s history. In 1998, Dana International became the first transgender winner, whilst in 2014, Conchita Wurst became the first drag queen to win the competition. Winning the competition usually comprises of a substantial amount of positive press coverage, a song with an inspiring message, and millions of voters – both emulated the political acceptance of the fluidity of gender and sexuality.

But this does not mean that everyone’s at the same stage of the political spectrum. This year, the semi-finals have already seen controversy for the Belarusian broadcasters. During the vote counting of first semi-final, Dana International performed a cover of Bruno Mars’ ‘Just The Way You Are’, which was accompanied by a kiss-cam that featured members of the crowd. There were a number of gay couples featured kissing in the number, to which the Belarusian presenter went on to hope that the number would “finally find some cool couples”.

Of course, to love is something that we should all have a right to across the world. Yet there are many out there who still politically declare that they are against such values.

Secondly, performances do not mention party politics, but they do make political statements. Armenia entered a song in 2015 named “Face the Shadow”. It featured the lyrics “Don’t deny/Ever don’t deny/Listen don’t deny” in reference to the massacre of 1.5 million Armenians to mark its centenary.

This was followed by Ukraine’s winning entry by Jamala in 2016. Named 1944, it was based on the deportation of the Crimean Tartars by Stalin in the 1940s. In fact, Jamala even told The Guardian that the song reminded her of present day Crimea (which was annexed by Russia in 2014). However, the EBU ruled that the song contained no “political speech”.

And last year, winner Netta described her song as “the awakening of female power and social justice”, whilst the French entry emoted the story of a Nigerian refugee as she went into labour on board a rescue ship.

It seems that entries are starting to become more and more explicit with their messaging. It isn’t known if this will mean the EBU will imply stricter rules based on how influential and how impactful Eurovision entries will get, and as populism increases in many parts of Europe, the urge for entries to send counter-protest songs seems ever more likely.

The Eurovision Song Contest is a fantastic spectacle, bringing people of all walks of life together. But, it will never be possible to ensure that the contest is apolitical. With the show’s openly pro-European stance, alongside the increasing number of discrete, subliminal protest entries, it’s hard to see a future edition of Eurovision which doesn’t feature a political controversy.

Has the death of May’s deal paved the way for a new Brexit approach?

It really is ironic, isn’t it? Despite a third successive Brexit defeat for Theresa May, it seems the fallout has at last paved the way for an alternative approach to the UK’s withdrawal from the European Union.

Friday’s Commons defeat was smaller than those which had come before it on 15 January and 12 March – the majority against Mrs May was 58 rather than 230 and 149. The vote was also confined to the so-called ‘Divorce’ rather than extending to the crucial political declaration. But, even so, the verdict was clear- the vote in its current form is dead and buried.

Given that her deal was likely to lose for a third time, the question has to be asked: why did the prime minister so willingly invite her own humiliation? For a prime minister who, since taking office has faced 35 cabinet resignations, conventional wisdom would surely prevent her from inflicting any more embarrassment upon her stricken premiership.

There are a host of reasons. Her obdurate character, her inept strategy and the seeping political authority. However, perhaps the most crucial reason was to appease the various party wings, and indeed the country, by showing that some kind of Brexit was on the road. But her systematic misjudgements and succumbing to partisanship meant she was unable to meet the deadline of leaving the EU in what she called “an orderly fashion” by 29 March. The prime minister was clearly trying to demonstrate to leave voters that it was everyone else apart from her that was getting in the way of Brexit. Indeed, Mrs May has, throughout the process, tried to turn the spotlight of blame on Labour. But they owed her nothing.

According to Geoffrey Cox, the attorney general, the reason for May trying again was purely a matter of procedure. The prime minister needed to get the deal through so that the latest Brexit deadline could be moved back from 12 April to 22 May which, in theory, would allow Parliament to force through the final furlong of withdrawal legislation and avoid the European parliament elections.

But the PM had more political reasons too. The revolt of MPs last Monday, in which they took control of the parliamentary timetable, opened the possibility that opposition MPs and pro-European Tories might force a soft-Brexit. Many panicked at this prospect, and with Mrs May promising to stand down if her deal was voted through, more than 40 MPs supported a deal they had once fiercely criticised. Even so, it was all to no avail, yet Downing Street seems to suggest that it can rely on those switchers in order to make things easier for the deal if May tries a fourth time.

But a fourth vote would be nonsensical. Instead, Mrs May’s defeat clears the way for an alternative approach. Indeed, this week’s indicative votes – whilst not producing an outright majority – proved that there is a majority for a customs union-orientated solution. With Theresa May having now extended the olive branch to Jeremy Corbyn in order to find common ground, the prospect of either a customs union or second referendum on the final deal are very much in play.

If the Commons can rally behind these then the EU summit – which commences on 10 April – can be asked to give the UK an extension of article 50 to formulate a different form of a withdrawal deal, potentially with a public vote at the end.

Whatever happens in the short-term, maybe, just maybe, Theresa May has kicked the can hard enough to create space for a belated, but much-needed compromise.