When Lord Lawson argued in The Times for a UK exit from the EU (reported in the Guardian; no pay wall! ), he said his arguments had nothing to do with being “anti-European”, but it appears they were nothing but. Filled with emotion and political zeal there was little relevance or fact based on economic evidence. Which is extremely disappointing from an ex-chancellor.
He stated that UK exports to the EU have risen by 40% while exports to the EU from countries outside of it have risen by 75%. If we were to leave the EU we would have to start paying import duties, the UK would not (at least in the short term) have a free trade agreement with the EU. This would mean that our exports to the EU would become more expensive relative to developing economies.
At a time when nearly half of our exports go to the EU, leaving the EU would destroy our competitive advantage and weaken our export market.
Lord Lawson mentions the City of London and how it would be good if we left. But a large proportion of people working in the City of London are dependent on EU membership for their jobs. Many headquarters of international businesses are based in the UK because we are part of the EU, not despite it. If they lose access to the common market questions over their efficacy will be thrown into doubt, with the likely result that headquarters would move to EU countries.
Across the UK 1 in 10 of all British jobs are dependent on the UK being in the EU. 3.5 million jobs would be put at risk, potentially creating an unemployment crisis.
At a time when our own economic future is not certain talk of leaving the EU is a dangerous political game to play.
Lawson does highlight an important fact: that there is huge economic and political growth in the world outside of Europe. But rather than participate in the largest economic and political grouping in the world he would happily see us sat on the sidelines, further destroying our ability to take part in international negotiations. With the US about to sign a free trade agreement with the EU they will have very little time for a small country that wants to make itself smaller.
What is becoming very apparent is that the UK is likely to have a referendum on its membership in the EU. The Conservatives are feeling threatened by UKIP and are swinging widely to the right in the hope that it wins back some of its “traditional vote”. This is an argument they are having internally, they have had it before, and it is going to continue until they have a referendum. Meanwhile Labour are struggling to make the impact they should be and are likely to jump on board any populist policy they can to get them a few more votes. If we do have a referendum it is our responsibility as a true liberal, internationalist and (sometimes) pro-European party to make a positive case for the EU now.
This means selling the positives economically, environmentally, for security, for jobs and how these positive benefits affect people’s everyday lives.
* Richard Davis is a prospective Member of the European Parliament for London. His website is here.
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13 Comments
“If we were to leave the EU we would have to start paying import duties”
Nobody knows that this is true. If we had to start paying import duties then the remaining members of the EU would have to start paying duties to us too. As Germany exports more to us than we export to Germany, they would presumably be keen to have a free trade agreement set up as part of our exit plan.
By all means give us some good arguments for staying in the EU but please make it something that isn’t of “little relevance or fact based on economic evidence”.
No no, it is our job to explain to the public what is the best thing to do. Not start with a biased kneejerk opinion based on an out of date preamble. Objectivity beats propaganda.
“. As Germany exports more to us than we export to Germany”
But would they export as much to us if we were out of the EU?
@Julian – “Nobody knows that this is true.”
Actually, we do know this is true. All EU member states charge a common tariff on all imports to the EU except where there is a free-trade agreement agreed by all the EU member states with non-EU countries. Hence, tariffs would apply to all UK exports to the EU, unless the EU member states were willing to conclude a free-trade agreement with a non-EU UK.
There is NO obligation on them to do so. In addition, it is important to remember that EACH EU member state must approve such an agreement – each member state has a veto on it. Even if Germany is desperate to do a deal (a major presumption), Greece could veto it and make, let’s say, the return of the Elgin marbles a pre-condition to an EU-UK trade agreement (they after all have had a running row with Macedonia over that countries name for the best part of two decades now).
Gambling the economy on the basis that the other EU member states would fall over themselves to help a Eurosceptic government here in the UK seems both foolish and extremely arrogant.
All this is fine and true, insofar as it goes, but at what price does this economic argument come with regards to its cost to british sovereignty?
This is rarely articulated, particularly not here, but then people complain when i make that exact argument via the quote from the “EBA safeguards” research paper:
http://www.openeurope.org.uk/Content/Documents/PDFs/EBAsafeguards.pdf
Yes, it is to be hoped that we can renegotiate an arrangement that explicitly separates single-market oversight (which we like) from economic governance (which is almost universally loathed), but what happens if that will not be granted by the likes of france and germany (only actors that really count in EU negotiations)?
Offering the party as a cheerleader for the EU, regardless of whether the EU will [continue to] offer us a place within as a [sovereign] nation-state, does not seem like an electorally credible position.
Cable has said it already; Cameron “is in the right place” in seeking to renegotiate those competences that are going to be dragged into eurozone economic governance in the course of the next few years, and then seeking a mandate on the success of that renegotiation.
This is not about economics it is about national sovereignty, the right to control our law makers, the right to elect a government and not just EU managers. This is about the right for the people we elect to decide who will and who will not be allowed to come and work in this country.
There are some economic consideration the fact that the UK has a balance of payments deficit with the EU, we buy a loads more from them than we manage to sell to them. So who is going to get hurt most, don’t forget any tariffs they decide to charge us we can charge them, again we will be the winners and anyway the whole thing is overseen by the WTO restrictions on protectionist measures.
Also of course we are paying a massive amounts each day just be members of this political club with which we conduct only about 9% of our total trade, yet every small business who never trades with the EU is shackled by its stifling regulations.
I hear so many opinions on whether to remain or exit the EU and i am convinced by none of them. All of the three main parties have lost so much respect from the public due to either lies or spin and not one Politician can give a straight answer and people have had enough. If the Political establishment were as intelligent as they would like us to believe then we would not be in the position we are now. No wonder UKIP is rising in popularity.
Give the people the option to remain or stay, or do you think we are so incapable of such decisions ??????
I am starting believe that all of the parties represent their own priorities rather than those of the public.
Please prove me wrong and remember that you represent us and we do not need a nanny state, the last Labour goverment proved what a disaster that causes.
Rubbish Ken. If it were about democracy I would hear Europhobes bringing forward ideas for the direct elections of the Commission, or trans-european lists, or improved transparency in the Council. It isn’t amount democracy for you Europhobes, do not pretend it is. You havn’t got a clue. You don’t care.
@ Antipopulist – “Rubbish Ken. If it were about democracy I would hear Europhobes bringing forward ideas for the direct elections of the Commission, or trans-european lists, or improved transparency in the Council.”
You’re getting too hung up on the word “democracy”, forgetting that it is only a means to the desired end; “representative”:
The root of the problem comes from not recognising a common demos with a sufficiently converged social and cultural history that might permit indirect governance which would be deemed legitimate for it recognition in being [both] representative [and] accountable.
The crucial feature of indirect democracy is the perception of representation, the collective trust in shared aims and expectations that allows the people to put their destiny in the hands of another, safe in the knowledge that even if ‘their’ man doesn’t get the job then the other guy will still be looking after their best interests.
The manner in which this trust is built is the knowledge that you and ‘he’ have a history of cooperation, and that your respective families likewise have a shared social and cultural history of cooperation, all of which allows you to trust that when adversity strikes ‘he’ will act in a predictable and acceptable way.
I simply do not recognise a sufficiently congruent set of aims and expectations to assent to being governed by the common will of the EU.
This does not mean that we should not strive towards harmonious cooperation and collaboration wherever a common viewpoint will bring a more effective outcome.
@ Paul R
“Gambling the economy on the basis that the other EU member states would fall over themselves to help a Eurosceptic government here in the UK seems both foolish and extremely arrogant.”
Nearly but not quite. in this hypothetical world a free trade agreement would be in the interests of both sides.
However, gambling the economy on the basis that other EU member states would do what is best for their own citicens seems both foolish and extremely optimistic.
@ ATF
“But would they export as much to us if we were out of the EU?”
It would be in their interests to, and the German government would probably want to but, given the nature of European politics, that is how it would work out is anyone’s guess. There is a list of examples of European governments not acting in the interests of their people.
@ Richard
“What is becoming very apparent is that the UK is likely to have a referendum on its membership in the EU. The Conservatives are feeling threatened by UKIP and are swinging widely to the right in the hope that it wins back some of its “traditional vote”. This is an argument they are having internally, they have had it before, and it is going to continue until they have a referendum. Meanwhile Labour are struggling to make the impact they should be and are likely to jump on board any populist policy they can to get them a few more votes. If we do have a referendum it is our responsibility as a true liberal, internationalist and (sometimes) pro-European party to make a positive case for the EU now.”
One of the reasons we should have a referendum is that we promised one.
We should be making the case for one also, as the EU is in a constant state of evolution, how we want to see it evolve. Mindless devotion to whatever it becomes is not sensible but an intelligent aim of what it could be is more persuasive.
The key is not the raw volume of trade but the amount of comparative advantage gained, Most of the trade with similar economies in the EU is with very thin comparative advantages (sending essentially the same products in each direction) than the trade with economies in the outside world that differ from our own to a greater extent (sending different products in each direction) and brings more economic benefit.
If it is an in or out referendum I want “in” and “out” to be defined before I decide how to vote. Particularly whether”out” will include staying in the EEA.