The UK is currently going through a soul-searching debate,which will culminate in a referendum in three months time, on the 23rd June 2016, as to whether to remain a member of the European Union (EU).
The EU evolved out of the European Economic Community, which originated after the second world war to bring France and Germany together in order to stop any further European conflicts. It was a practical, workable economic pact and one in which the UK joined in 1973, despite being blocked on many occasions by France. This economic pact,if it had been allowed to naturally evolve through trade, may have succeeded. However in 1992 the Maastricht Treaty changed a workable economic pact into an artificial and dysfunctional political union. If an economic zone is a square peg, then that Treaty forced it into the round hole of political union.The EU has now become a Byzantine Empire with structures that are not fit for purpose and costs the UK an estimated net £33 million a day, equivalent to £12 billion a year, that’s after deducting the rebate we receive.
I believe that the UK has always been a reluctant European. On a superficial level, Europe been a place for holidays and away games for the British army. Culturally and administratively our distinctiveness is determined by our unique history, culture and common law system, as opposed to a universal Napoleonic code practised in western Europe, which permeates all aspects of this country and the way we conduct ourselves. No matter how much we want to be Continental Europeans, the real Europeans view us as distant cousins and our adoption of Continental ways as an affectation.
The media is not helping the debate. They have reduced it to, at best, economic scaremongering on one side and immigration chaos on the other, or a worst, an old school rivalry between David Cameron and Boris Johnson. What I do find shocking is lack of clarity of facts, strategy and argument on both sides.
If the debate is about sovereignty, then being a member of the EU means that the UK is subordinate to EU laws and policy. The UK is therefore, as it currently stands, not an independent sovereign state. Membership to the EU is akin to being a federal state in the USA, where state law is subordinate to federal law. Therefore, those who want the UK to be an independent sovereign state should vote to leave the EU.
If the debate is about curtailing immigration, then the fundamental aspect of the EU’s free movement of labour means that the UK has no control over its borders. Those who want to have control over immigration should vote to leave the EU.
I believe that for most, the concept of sovereignty is too esoteric to be of real everyday concern. It is however the issue but it manifests itself through the current problems of migration. This has been the bone of contention since Tony Blair opened the floodgates to all and sundry in the 90s. It has been compounded by the accession to the EU of poorer Eastern European states and then the current refugee crisis. The recent refugee crisis has shown that the EU’s borders are porous, the political union is powerless to resolve the problem and that the UK is the number one destination for many. Would leaving the EU resolve this problem? It may not resolve the underlying causes but it may go some way to resolving the specific effects we are facing. It would allow more restrictive immigration. We would probably not require other European members to get a visa to come to the UK but we could require any refugee from these countries, who has received a new passport, to be vetted or require a visa. In short, it will allow the UK to be more discriminatory on immigration issues and a more discriminatory immigration policy is what is required. It may also create the right environment for a complete overhaul of both the UK’s immigration and nationality legislation, without the being hog tied by EU obligations.
Those against leaving the EU argue that by leaving the EU to get control of immigration we are committing economic suicide. Imported EU Goods will become more expensive. Export markets will collapse. Jobs will be lost. I don’t believe this argument. Yes, the EU is the largest trading block in the world, with 500 million consumers. However its largest trading partners, according to its own figures, are the USA, China and Switzerland, in that order. How many goods can you find in your home stamped ‘made in the EU’. Most I have found have ‘made in China’ stamped on them. The EU, according to their own figures, supports 31 million export jobs and just as importantly it supports 19 million jobs outside the EU. The EU is not a hermetically sealed trading environment. It trades globally with both EU and Non EU members. More importantly the economic benefits of trading with the EU, as if an EU member state, are also extended to Non EU countries through various trade agreements.
I am surprised that not more has been made of the European Free Trade Association. The European Free Trade Association (EFTA) is an intergovernmental organisation set up for the promotion of free trade and economic integration to the benefit of its four Member States: Iceland, Liechtenstein, Norway, Switzerland. Note that one of its members is Switzerland, the third largest trading partner with the EU, after the USA and China, according to the EU’s own figures.
The EFTA’s trade strategy has evolved progressively beyond the confines of the European continent. Since the late 1990s, the EFTA States have “gone global” with the objective of maintaining and strengthening their competitive position in the world. Through EFTA, the Member States have created one of the world’s largest networks of preferential trade relations. EFTA’s network of free trade agreements (FTAs) secures economic operators preferential access to markets currently of around 440 million consumers outside the European Union
What EFTA is not, is part of the EU political union. They are part of the European Economic Area (EEA). The EEA Agreement does not cover the following EU policies: common agriculture and fisheries policies; customs union; common trade policy; common foreign and security policy; justice and home affairs: direct and indirect taxation; or economic and monetary union. This seems like the place the UK wants to be. A Free Trade Area.
In addition to this the EU has a number of Trade Agreements outside the European area that waves customs tariffs. Take Singapore and South Korea. Both have a free trade agreement in place. Singapore has over 10,000 EU companies established there as a hub for the Pacific Rim. It signed a Free Trade Agreement with the EU on the 17th October 2014 stating that ” all customs duties by a party on goods originating in the other party shall be eliminated”. If a small trading state like Singapore can negotiate this, what could the UK do should it wish to leave?
Add to this the current Transatlantic Trade & Investment Partnership (TTIP) being negotiated between the EU and the USA that aims to open up trade between the two. Would the UK miss out. I don’t think so. Both Canada and Mexico, as independent sovereign states, have too joined TIPP. I see no reason why the UK, if it was outside the EU, could also be a signatory on its own terms.
Another argument the put forward by those wanting to remain in the EU is compliance; compliance of standards, products, services. That is if we leave, suddenly our exports wont comply with EU standards and we wont be able to sell them into the EU. Having worked in export, I know that all export orientated business are fully aware of complying with the destination country’s product requirements. In fact the EU makes it easier, as there is just one standard for 28 countries. We comply and export to the USA quite happily without being a member of NAFTA. The UK manufacturers are not suddenly going to cease producing products that are not fit for their export market. The politicians seem to confuse compliance, supply & demand with accessibility. My view is that if the UK votes to leave the EU, accessibility can be achieved through both membership of EFTA and specific Trade Agreements and that trade compliance and so supply & demand will remain the same.
As for currency issues. The UK is not a member of the Euro and not a supporter of monetary union. It is thanks to the wisdom of others that we are not, as that would have made the issue of leaving nearly impossible. Having your own currency is beneficial. It acts like a car bumper, it takes the little sporadic knocks that happen in the global economy by increasing or decreasing in value. We have this bumper, so that when the economy goes through a rough or golden patch, our currency can fall or increase in value and the Bank of England can influence this by rising or decreasing interest rates. If we didn’t have this and were part of the Euro, the only variable that could absorb these sporadic economic changes would be employment. Without a bumper, that would be more like receiving a dent in the car each time.
Should the UK decide to leave, there will be turmoil, in the short term, in the financial markets. No one likes uncertainty. However, if the politicians put forward a clear strategy based on trade and aims to position the UK as a trading centre between the triumvirate of North America, the EU and the Commonwealth (which has been rather overlooked), I feel that the UK could again create a unique position for itself.
Therefore, on balance, I believe that leaving the EU will give a free hand for the UK to determine its own position and economic interests without the political shackles of the EU. The savings of £12 billion a year could go into much needed quality housing stock, the reduction of transport costs and the improvement of infrastructure.
4 Comments
John,
Whereas I find your article makes a great deal of sense, save for the odd throw away about the army (as you well know NATO played a great role in bringing the cold war to an end, to say nothing of allowing the French to pay realpolitik with its forces … No up front … Yes between the sheets.
I do however believe you have missed the aspect of why I firmly believe we need to be in the heart of Europe. Simply put, we are still both very capable (militarily, economically, in governance and administration) and much sought after to play a strong role in global issues … an isolationist policy, which puts us on the periphery of what is federal Europe would put this at great peril. Further the history of Britain has shown that whether we like it or not we are the arbiter of Europe if not the Western Civilisation …. being boringly but wisely ‘politically’ central …. a role one could say we started playing from1066 onwards. Our future will determine far more than we think …
We will discuss more no doubt
Thank you. I don’t think that Britain has ever been at the heart of Europe, nor do I believe that remaining inside the political union will allow it greater control of European affairs where 27 other countries have their agenda to promote.
An independent UK , the 5th largest economy in the world, on the doorstep of one of the largest trading blocks in the world, having spent 40 years understanding the ‘ins & outs’ of how it works, already complying with all required product & service regulations and one of its largest trading partners, is a much more exciting prospect for the economy.
Enjoyed your article. It made interesting reading and you made some valid points.
It is an important debate to have, especially as it has been over 40 years since the British people last had a say on our EU membership. The EU has changed vastly since.
I am still on the fence but apart from the key aspects; sovereignty, economic governance, competitiveness and immigration it is also about the EU’s effectiveness as a whole and how we sustain it. Europe should have the flexibility of a network, not the rigidity of a bloc.
In my mind dealing with the idea of Ever Closer Union – which may be right for others may not be right for Britain. What is important is protecting Britain’s interests outside the euro; increasing economic competitiveness to create jobs and growth; reforming welfare to reduce the incentives which have led to mass immigration from Europe.
It will be interesting to see the lead up to the referendum. Until then I am yet to be persuaded either way.
John,
You should know that I only had time to glimp your article and even less to throw a ‘ball’ back. Hence you deserve a better response. Having re-read your article, which is well researched and argued, I should premise my concerns with saying that I am not interested in migrant or economic issues. I consider it would be foolhardy to vote on these issues when I fully expect (as do a probable majority of furtive voters … Yeahs and Nays) the future of both is almost certainly not going to be determined by either the UK being in or out of the EU.
The question of Sovereignty is a different matter and certainly relevant. I too strongly believe the EU legal structure is arcane, however my own first hand experience suggests this is a smoke and mirrors campaign to delude all Europeans (including MEPs) that it is a democratic structure. It is a feather bed for European leaders to conduct realpolitiks in the wings and our constitution with its benign monarch allied to deep-seated moderate governance is well matched to combat the EU Presidency and does so far better than the new ‘proletariate’ who only see the ‘commercial sideshows’ of media moguls and political hype, could ever comprehend.
However my real concern is that the vote is indeed a major international constitutional matter and not one to be approached as a popularity poll, as it is. When dealing with Europe we should be looking to the future, not from a self driven material or pragmatic viewpoint, but from a global risk assessment standpoint. I am no expert but to do this, one has to model likely outcomes for the UK (in and out) … this requires an intimate understanding of historical premises …. as well as current global trends and likely future International game plans. The media and pundits are apparently shy (by avoiding) of this concern because one, their audience is too interested in their own pockets and heritage and two most probably find such concerns too difficult to contemplate and three, not commercial.
Not privy to any models, my reading of history and credible current thinking, leaves me very concerned that the global ramifications of a ‘revolutionary’ break away from the EU, would leave the UK (possibly without Scotland) trying to justify its current ‘arbitrary’ global accreditations. The latter is based on what I have found traveling across the world with regard all UK governance, legal and administrative matters. I have had personal experience of this working with at least three Government ministerial departments … and have been told that it covers all departments. It is quite clear that despite media mischief making, and again in realpolitik terms, we have many admirers, allies and foes alike and I do believe a perceived reckless move would at best make some countries wary and worst compromise our global congenital authority. With a world probably in a worse place than it has been for some time, British karma is vital.
Another more esoteric point, on a strategic level I do think the long term sustainability of mankind has to spring from some sort of international integrated network, which can only accrue from stepping forward from national, isolationist platforms (e,g man to tribe, to city state, nation state, federations etc.,). To back away from a European ‘mix’ we are reversing this process. Yes, the quasi ‘federal’ system is not working well but man has progressed by fixing things and the British have been at the van and can now provide some patrimony, especially with regards diplomacy. For me we need to be in the heart of Europe (regardless of the Euro) sorting things out … and arbitrating between the Germans and French (who are driving it, whatever the smaller european nations believe). Not being alarmist, but the need for such cohesion is here now with a global economy playing havoc with nationally designed budgets, and climate change running with cultural and religious schisms to knock loudly on our children’s doors.
I heard the other day that one out of three babies born in the UK today will reach 100 … somehow I think that fate has another plan …