A continuing series of articles dealing with matters relevant to British membership of the EEC and the forthcoming referendum

Sovereign State

John Papworth on 'small for stability

The ironies of history are legion, and it is surely one more to the collection that at a time when the major capitalist economies are betraying all the classic signs of malfunctioning that attend any form of overgrowth, a number of European countries should be seeking to promote even further growth by the creation of a Common Market.

There is a curious wilfulness about much of the comment which passes for analysis on Britain's economic predicament; Mr William Rees-Mogg is quite certain it springs from an excess money supply and a failure to link the value of sterling to gold, although why he should bring that up now, especially when there are many countries in the world whose currencies have never been linked • to gold, is a mystery. Others inform us we need more export-led growth, others that the trades unions are out of hand, others that we have the wrong government, the wrong leaders, the wrong psychology, wrong ideas about our consumption standards and so on and so on. The experts, and I dare not omit the Papworth definition of an expert as being one Who makes bigger mistakes, are apparently evenly divided as to whether we should go for What they call 'reflation' and risk destroying sterling, or for retrenchment, by which they mean depression, massive bankruptcies and even more massive unemployment. One could extend this list of diagnoses of our Ills and the resulting prescriptions for their cure to the point of tedium, and where even Major Douglas and Henry George might get a mention, but let us get down to the key question. Why is it that all our wise men, without exception, obstinately refuse to look at the one factor in our situation which stares them in the face and which takes full account of the extent to which our economic affairs are out of control? For if the absence of effective control

for given social ends is not the salient .characteristic of our present crisis what then

la? Clearly control of anything cannot be exercised in a vacuum, it must indeed be related to the forms appropriate to the functioning of whatever it is we seek to control, and in the Case of economic activity the question must be related to the size and the scale of the unit.

But step back a bit. Here we are in the final 9uarter of the twentieth century; we have

behind us a formidable body of specialist knowledge and sophisticated technique in relation to the material world, the working of

economic systems and even to the psychology of individual motivation, sufficient to make our World a paradise of tolerance and plenty.

What then is holding us back? Why don't we get on with it? What has appeared on the modern stage which negates our hopes and mocks our finest visions with a spectacle of thronic economic crisis, mismanagement and hreatened social collapse? really must face the implications of the Obvious fact that we are not machines, far less

Monster-sized machines, but human beings, and that there is a scale of economic affairs appropriate in size to our human capacity to control it, i

it, appropriate indeed to our humanity;

tha, f we are sensible enough to abide by control it, i

it, appropriate indeed to our humanity;

tha, f we are sensible enough to abide by han ',Scale we will have a ready instrument to o to enable us to achieve what we want,

whereas if we allow growth to proliferate to a degree beyond our capacity to control we must expect as a matter of course to suffer all the ills such a lack of control brings in its train.

This is not a recent lesson, but one writ large in modern history. The great depression of 1929 affected the economic fortunes of almost the entire world for a decade. Nobody wanted this depression, which caused immense avoidable suffering to millions of working people, and whilst its course continued nobody from John Maynard Keynes downwards knew how to stop it.

Yet it need not haVe happened at all if the factor of the limits of size in relation to the human ability to exercise effective control had been observed. The crisis did not, after all originate in Belgium or Switzerland or Norway, it originated, as common sense suggests it might, not in any small country, but in a large one, in fact the largest of the lot in terms of magnitude of economic effort, the United States. The great depression was a product of giantism, Unlike Europe the United States is not divided into small sovereign entities, it is a vast • unfettered continental market. One surely does not need to be an economist to see that the bigger a market the more violent its fluctuations are likely to be. The police are well aware of this in tackling problems of crowd control; no police inspector worth his salt would dream of allowing a vast crowd to assemble without making some safety provision in the form of crush barriers and so on.

Any mass is rightly regarded as a potential danger to itself, hence the barriers are not designed to prevent normal movement of individuals from one place to another, but to prevent a sudden abnormal movement of the entire mass which might endanger life. It is thus easy to see how once a panic was engendered in the New York stock market it became uncontrollable; there were no safety barriers in the different states of the United States in the form of separate currencies, tariffs, import quotas and the rest of it to contain the disaster, and just as when a large crowd panics it is prone to endanger the lives of many people who may not be a part of its mass, so the smaller economies of other countries were engulfed in this panic as it swept round the world.

We need also to see that it is not simply the size of a country's economy which may render it beyond control in times of crisis; over recent decades there has been a considerable growth in the size of particular economic enterprises which is producing the same effect. We have been watching a hectic process of takeovers, mergers, consolidation, horizontal and vertical integration, as well as the rapid growth of large multinational concerns with no reckoning at all as to what this process is

leading to and the dangers it is creating of top-heavy lack of balance and control which at a time of crisis may bring the whole .works crashing down.

This is the basic theoretical reason why the moves towards the integration of the European economy is a compound act of the most egregious folly. Yet nowhere do even the so-called anti-Market forces seem to grasp the importance of this weapon in their armoury or show any readiness to use it, and this is possibly why their case is in danger of going by default. We all know that a small crowd is more manageable than a large one, that a tall ladder is

more difficult to manipulate than a short one and that an elephant is more cumbersome in its movements than an ant. Why then do we assume that economic affairs are excluded from the, consideration of size, scale and proportion that govern the natural world? "Everything," said Seneca nearly twenty centuries ago, "that exceeds the bounds of moderation has an unstable foundation."

The widespread disquiet about the entire Common Market enterprise springs from wisdom of this order; if the forces which are so rightly opposed to the moves towards European integration were to make it the basis of their campaigning instead of allowing themselves to be distracted by side issues about farm prices, the size of Britain's 'contribution' and the rest of it they might yet surprise themselves by the degree of favourable grass-roots response they succeeded in evoking, for fundamental to the whole debate is the question of liberty and sovereignty, both of which require moderation and seemliness of proportion as their natural expression if their fruits are to be garnered. In both politics and economics it is not growth that we should be seeking, which may lead anywhere and destroy everything, but control. It is an awareness of how insistently this truth is pressing upon contemporary events which is leading to the grass-roots call, now increasingly heard, for decentralisation, devolution, community power, Welsh and Scottish nationalisms and a host of other concerns which express the alarm people are feeling about overgrowth, over-centralisation and the general erosion of liberty they entail. The anti-Marketeers have more allies than they realise, and a far-seeing attempt to enlist them would make every ward, village and workplace in the land a focal point of opposition to the Market proposals despite whatever the renegotiations produce, and make a vict6ry for freedom and sanity in the forthcoming referendum assured. What are we waiting for?

John Papworth is the author of Economic Aspects of the Humanist Revolution of Our Time and is currently working as personal assistant to President Kaunda of Zambia