JP/6/SWEDE2

Swede smell of democracy Paul Foot Guardian News Service London

Consternation in high places is always a cause for rejoicing. The gloom that struck down important people throughout Europe after the result of the Swedish referendum on the euro was utterly delightful. Every big political party, every major national newspaper, every representative of Swedish big business and the stock exchange, they all called for a yes vote. In a huge turnout, the neglected element -- the Swedish voters -- by a substantial majority voted no.

In Britain, the issue seems more complicated. The Conservative party, for instance, is against the euro. The Tory arguments are founded either on silly old-fashioned chauvinism, or an equally absurd sentimentality about the currency.

There is very little evidence that people give two hoots about the currency. Before the 2001 general election in the UK, former Conservative opposition leader William Hague toured the country shouting "You have only a few weeks left to save the pound!", but no one took the slightest notice, and the Tories were smashed.

Nor is there much evidence that the Swedes who voted no cared a jot for the krona. If "Save The krona!" had been the only issue in the campaign, the political and financial establishment might well have won.

A far more important issue was, and is, the euro's threat to democracy, the right of people to have some say in the nature and behavior of the governments that represent them. Most people treasure their right to vote and get very upset if anyone tries to muck about with it.

This is an especially crucial issue for socialists. Capitalism is a fundamentally undemocratic system. The big companies, banks and financial institutions operate on the principle of oligarchy. The great, the good and the rich rule their fiefdoms without having to put up with any impertinent interference from the people who do most of the work or buy the goods.

So the right to vote -- representative government -- is a constant threat to them. Much political history since the advent of universal suffrage has been a story of the battle between unelected capital and elected social democracy. The real significance of Tony Blair's "New Labor" project in Britain is the abject, and I hope temporary, surrender of social democracy to corporate power.

When the European common market (the forerunner of the EU) was formed in the 1950s, the capitalist oligarchs were determined to protect their domains from the growing social democratic forces.

The institutions set up to run the common market were exclusively oligarchical; none was elected, and all governed, and still do, in the interests of the world's rich against the interests of the world's poor. The European commission, the European bank, the European court of human rights and justice, all were kept far from any democratic process.

A European parliament, elected by the people, was belatedly set up, but it was kept well clear of the activities of the commission. Even its buildings were hundreds of miles away. The chief activity of MEPs seemed to be collecting their (grotesquely large) salaries and expenses and rubber-stamping the decisions of the corrupt oligarchy they were meant to regulate.

Since the abject surrender of New Labor in Britain, individual parliaments in Europe have become ever more servile to the great corporations that run the world. The EU and its institutions, however, are more servile (and corrupt) than the directly elected parliaments.

It is this feeling of increasing democratic impotence in the face of vast, irresponsible corporations that tells us, I guess, what persuades people to vote no in referendums on the euro.