Referendum Watch; Would Britain be better off after Brexit ?

Would Britain be better off outside the EU? In terms of democracy and sovereignty the answer is an incontestable yes. Economically, however, the honest answer is that no one knows for sure. The weight of evidence suggests that it would be. Or, more accurately, could be. Certainly, the [pullquote]The next decade is crucial; the momentum is relentless. The majority of the people voting to remain in the EU think that they are voting for the status quo. But they are not: that option does not exist. On 23 June, either we vote to regain Britain’s independence or we vote for ever deeper integration with the United States of Europe[/pullquote] opportunities that lie outside the EU are more enticing than those within it, and the potential is clearly there for noticeable economic improvement on our current situation. But this presupposes an optimism that Britain would avail itself of these opportunities enthusiastically and competently. This could happen, but I do not share the optimism that it necessarily would. For this would require at least half-way adequate stewardship by our political masters. Can anyone identify a dream team pairing of prime minister and chancellor among our recent offerings: Cameron and Osborne, Brown and Darling, Blair and Brown, Major and Clarke? It does not bode well. But maybe, just maybe, a Brexit would also mean another break with depressing tradition, hopefully resulting in those taking highest office not being the usual lightweight, self-serving narcissists preoccupied with power for its own sake.

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Leave Campaign. On every street twenty minutes after a vote to exit?

To my mind, one of the best evaluations of the economic impact of Brexit on the UK comes from the German economist Wolfgang Münchau, an associate editor of the pro-EU Financial Times and President of Eurointelliegnce ASBL. In a refreshingly honest research paper undertaken last year, he concludes that the likeliest scenario of Brexit will not entail a net significant advantage or disadvantage one way or the other. In the process, he admirably shows that the much vaunted ‘single market is a giant economic non-event, for both the UK and the EU’. Nonetheless, it is continuing access to this sacred trading panacea that unfortunately dominates the debate on both sides – further evidence of how the referendum is side-lining the much more fundamental issues of sovereignty, security, culture and democracy.

What is evident is that any considerable short-term shocks to the economy (as there are bound to be in a divorce) would be softened by not having to pay extortionate membership fees to the EU club. The UK’s nominal annual ‘contribution’ (levy is more accurate) is around £19 billion. £5 billion of this is not officially handed over, as it constitutes Britain’s ‘special rebate’ (the Fontainebleau abatement). This leaves a figure of £14 billion. £4.5 billion of this is received back in the form of regional development funds and project funding. The result is a total net contribution of some £9.5 billion a year. This is still a huge sum; as Eurosceptics say, think of all the hospitals, schools and infrastructure we could build with this. Crucially, however, the rebate is politically vulnerable and the UK taxpayer has little say in how money received back for regional development is distributed.

Time and again Europhiles warn that the EU would punish Britain for leaving. It’s as if they see the EU as being so mighty it can dish out vindictive retribution with impunity. One seemingly telling (and, as ever, fearful) argument they deploy is: ‘Oh, what is to become of all the British ex-pats living in Europe? For they will lose out grievously’. According to the Royal Statistical Society and the United Nations Population Division, there are just over one million Brits living abroad in the EU (tellingly, a quarter of these are in Ireland). The House of Commons Library Briefing Paper from February 2016 estimates that there are three times that number of EU immigrants living in the UK. Europhiles want to scare us into believing that this figure of three million has no leverage, bargaining power or potential for reciprocal legislation against one million.

And similarly so it is with Britain’s trade deficit with the EU. Here Europhiles distort the numbers with the Rotterdam effect; they frequently include in their trade figures exports to Rotterdam – ie, part of the EU – that are in transit to the rest of the world, thereby disingenuously boosting the UK’s trade exports to the EU by as much as a third. Eurosceptics argue that given the extent of our trade deficit, the EU would never dare impose penalties on a Brexit UK or hinder new trade deals for fear of jeopardising all that lucrative export trade. However, some Europhile economists such as Anatole Kaletsky and other commentators believe that, in effect, the EU would indeed be willing to cut off their noses to spite their face.

The Eurosceptic argument here is the common sense one; but the minatory Europhile one might turn out to be closer to the truth. After all, since when has common sense been a feature of the great European dream? Punitive action may well be taken pour décourager les autres – anyone else thinking of making a break for it from the EU. For we are dealing with that most dangerous group of people: idealists. [pullquote]Punitive action may well be taken pour décourager les autres – anyone else thinking of making a break for it from the EU. For we are dealing with that most dangerous group of people: idealists.[/pullquote]Le grand projet remains alive and well. The EU, never one to waste a good crisis, is once again prescribing closer integration as a cure for current ills. The devotion of guilt-ridden Germany and other panglossian federalists to ever closer union remains undimmed; these are possibly willing to take a short-term hit (as in damaging trade relations with the UK) in order to keep the EU on track to its manifest destiny that Fate has decreed for it: a United States of Europe. This was the unequivocal wish of the EEC’s founding fathers, carved into the Treaty of Rome’s intent of ‘ever closer union’.

Just about all the most influential EU political voices have spoken openly of the over-riding imperative of continuing to build a United States of Europe. The plans working toward this have been drawn up in readiness. The next decade is crucial; the momentum is relentless. The majority of the people voting to remain in the EU think that they are voting for the status quo. But they are not: that option does not exist. On 23 June, either we vote to regain Britain’s independence or we vote for ever deeper integration with the United States of Europe.

 

 

 

 

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1 Comment on Referendum Watch; Would Britain be better off after Brexit ?

  1. Well, quite. I was having lunch with an Europhile friend the other day. We remained amiable in our discussion – as one is apt to do face to face – but I think I had the better of the argument, unless he was – as is his wont – being very kind. The two points which stand out in my recall are firstly that he accepted that the Remain campaign’s use of international threats was at odds with the EU’s professed devotion to freedom and democracy; and secondly that he was almost embarrassed or ashamed when I asked him, “So where is the EU project going?” He happens to be close to government, so he might be expected to have some knowledge of likely developments. Answer came there none. From good fellowship I didn’t press the point; but it seems clear what the real answer is – or will be, unless we are very lucky.