Which Way Out?
Prof. Tim Congdon (Economist)
Prof. Ivar Raig (Tallinn University)
Prof. Roland Vaubel (Mannheim University)
Ian Milne (Banker and Industrialist)
Prof. Patrick Minford (Prof of Economics Cardiff Business School)
Christopher Booker (Telegraph journalist)
Dr Richard North (Long time EU campaigner)
Mary Ellen Syon (Irish Daily Mail Journalist)
Kieran Bailey (15-year-old who is shortlisted for the Brexit prize)
This conference is important because it brought together some of the people who are likely to be part of the public face of the OUT campaign if and when a referendum is held on Britain’s future in the EU. Frankly, it was not encouraging, both because there was great deal of conflict between the views of this supposed panel of Eurosceptics and many of the proposals had a Utopian ring for they did not take into account the likelihood or otherwise of their plans being put into operation.
Prof. Tim Congdon
Congdon was the most forthright of the speakers. He wants Britain out of the UK full stop: no Lisbon Treaty Article 50 exit, just the Westminster Parliament repealing the Act which binds Britain into the EU. His main reason for taking this stance was that to commit to the use of Article 50 would mean accepting its legitimacy. That has its dangers because if its legitimacy is accepted before Britain activated the Article , the EU might extend the maximum two year waiting period the Article stipulates before a member state can leave to a much longer time. As this would require a Treaty change over which any member state would have a veto I think this is not a realistic threat provided a referendum is held soon.
Nonetheless, Congdon’s instincts are right, for to tie us into a two year waiting period would allow the EU to create a good deal of mischief. Using the Article 50 route would also provide an escape route for our Europhile political elite because they could argue that b ecayuse of the Article the best deal they could get was one which left us still within the coils of the EU, for example, a similar relationship with the EU to that of Norway or Switzerland, both of whom are signed up to the so-called four EU freedoms: the freedom of unrestricted movement within the European Economic Area (EEA) of capital, services, capital and labour.
Congdon was just as unequivocal on the claims that Britain would lose greatly if she left. He pointed out that the vast majority of UN member states were not EU members but were able to trade successfully both generally and with the EU, and cited various examples of countries, some small, outside the EU which had made treaties with much larger nation states such as the USA and China. Congdon also made much of the EU’s declining share of world trade, which is only around 12% now and is set to decline further.
As for Britain needing a plan as to what exactly she would do after leaving the EU before leaving, Congdon said this was completely unnecessary and cited the fact that some 65 independent countries today had gained their independence from Britain without having such a plan.
I agree wholeheartedly with Congdon’s overall strategy, but there is a presentational problem with the man. This is the first time I have heard him speaking in person. I was astounded by the eccentricity of his delivery. He would be speaking normally when suddenly he would explode into what I can only describe as an hysterical rant. This he must have done at least half a dozen times in his twenty minutes or so of speaking. As he is very likely to figure in any OUT campaign this is worrying. It is odds on he will not go down well with the general public, because eccentricity of any sort, even that which has some charm, will alienate as well as attract and frankly this was not an engaging eccentricity.
Congdon was also caught out by a questioner from the audience. He had cited the recent Canada-EU trade treaty as evidence of what could be done by Britain once she is outside the EU. A questioner asked him for details of the treaty. Congdon had to admit he did not know what they are. That is just plain sloppy. If you are going to cite something as evidence common-sense tells you to mug up the facts because as sure as eggs are eggs you will be challenged on the evidence.
Prof. Roland Vaubel
Vauble detailed the vested interest of the various instruments of the EU – Commission, Parliament, Court of Justice. In every case centralisation of EU powers increased their power. Hence, he saw no likelihood of any repatriation of substantial powers unless Article 50 is activated.
As for the process of leaving, Vauble took a legalistic approach. He maintained that the activation of Article 50 was the only way Britain could leave the EU because he considered the acceptance of the Lisbon Treaty by Gordon Brown made any other exit illegal. The answer to that is simple: treaties signed by a government which cannot be repudiated by a future government are utterly undemocratic.
Assuming Britain activated Article 50, Vauble said that the EU elite would give nothing much to Britain over the two years and the odds were that at the end of two years no agreement would have been reached and Britain would simply exit the EU without any agreement. Because of this Vauble claimed that Britain had to have a strategy for what was to happen after Britain left without a Treaty. Vauble’s solution was for Britain to make alliances with other EU members, especially the smaller ones. His overall message was that Britain could not survive on her own. Vauble further envisaged that a Britain which had left the EU and had some form of alliance with other states, both within and without the EU, could act as a lever to change the centralising tendencies of the EU. He seemed much more interested in using Britain as a tool for other states’ ends than suggesting the best strategy for Britain.
Prof. Ivar Raig
Even making considerable allowances for the fact that English was not his first language, Raig was an awful speaker, mixing incoherent passages with statements of appalling banality , all delivered in what I can only describe as a prolong yell.
Out of the incoherence came a desire for Britain to wrap itself in another supra-national bloc, in this case one based on North America, Germany, Scandinavia and other Northern European states. This he grandiosely labelled the New Atlantic Project. Like Vauble he believed Britain would not be able to go it alone.
Milne was in favour of using Article 50, although he was less committed to it under all circumstances than Raig and Vaubel.. For Milne activating the Article was more a question of showing willing to preserve legal form than a commitment to observe it. If the EU showed they were going to be obstructive after Britain activated the Article, then he was happy for Britain to simply leave by making a unilateral declaration.
He was far from pessimistic about Britain being able to negotiate a reasonable settlement with the EU, not least because of the disruption of EU’s trade with Britain if there was any serious delay. Milne emphasised how advantageous the EU’s trade with Britain is to the EU , both because of the large trade deficit Britain runs every year with the EU and the supply of goods to EU businesses such as the German car industry. He also pointed out the rest of the world would not take kindly to uncertainty because they also had an interest in Britain and the EU resolving their differences.
The most useful part of his speech was his detailed plan for how the exit should be administratively planned. He wanted a Ministry for EU Transitional Arrangements (META) set up to manage the business. He took his inspiration from large projects such as the Olympics and Crossrail.
There are contentious points in the detail of his ideas, not least his rather too trusting belief in the efficiency of private industry compared with public service. But his basic idea of a ministry devoted solely to the administrative, economic, legal and political issues arising from our departure is sound because it will be a complicated business.
The problem with his plan is that it is difficult to envisage any conceivable British government implementing it, not least because for a government to develop such a detailed plan would be to hamstring both the government of the day and any future government.
Prof. Patrick Minford
A decent speaker but completely out of touch with reality because he is in thrall to the laissez faire quasi-religion. A clear example of a man being captured by one of Richard Dawkins’ memes, in this case by a very harmful one. The problem with Minford is that he has spent his entire working life in either public service or academia. This allows him to maintain his fantasy of perfect markets with perfect information without the evidence of real life intruding.
Minford wants out of the EU because he has the fashionable but untrue idea that the British are in favour of free markets and free trade while the other EU members are locked in a socialist mindset. Towards the end of his offering he made the comment that the British had always been free traders including during the Industrial Revolution. This was a truly incredible statement because the British Industrial Revolution occurred whilst Britain operated arguably the most successful protection system ever seen through the Navigation Acts and the Old Colonial System. That tells you Minford either has a very tenuous grasp of economic history or is willing to deliberately fabricate to maintain the plausibility of his ideology. He might also ask himself how unions became so powerful in Britain if support for free markets and free trade is so heavily stitched in British minds.
From this misreading of both British history and indeed her current realities, Minford built his case for leaving the EU. He wants Britain to depart because he views the EU as a protectionist syndicate which prevents Britain from following her supposedly free market ways.
Having laid out his general scheme of objections to the EU he wandered into the ground of employment and extolled Britain as a far superior job creator than most of the EU whose unemployment was much higher. This difference he attributed to Britain’s free market instincts. From there he moved to the question of immigration and blithely told the audience that immigrants do not take jobs from Britons. He produced what he fondly imagined to be a knock down argument by trotting out the crude classical economic argument about how Britons would find jobs if only they would accept lower wages (which would be facilitated by less welfare provision) or were better qualified. This caused a good deal of anger amongst the audience with quite a few calling out.
When questions were taken I managed to get myself called. I told the meeting that on the question of immigration and jobs I had special knowledge from my time as an Inland Revenue investigator. I proceeded to detail some of the ways that huge numbers of jobs never came onto the open British market because of foreign gangmasters employing only their own nationals, ethnic minority employers employing only their own people, foreign companies bringing in their own nationals and the recruitment of foreigners for jobs by not only British companies but British public service employers. I further pointed out that around 5 million people who were counted as being in work in Britain were not meaningfully employed because they had to draw benefits to provide a living wage. If this 5 million is added to the 2.5 million officially unemployed, the real rate of unemployment in Britain is running at over 20% (the official unemployment rate using the Labour Survey count stood at 7.7% for 2.49 million unemployed in October 2013). That is not so very different from much of the Eurozone.
Having done that, I attacked the idea that Britons were wedded to the idea free market economics, pointing out the evidence against this belief such as I have already mentioned, and ended by asking from where exactly Minford got his fantasy view of Britain and the British. All of this was very warmly greeted by the audience and many came up to afterwards to express agreement.
What was Minford’s response? It was feeble to the point of embarrassment. He just kept on repeating various forms of “You are wrong” with absolutely no attempt to address the detailed objections I had raised to his words.
On the plus side he did reject the “Norwegian Option” on the grounds that it would not only tie us into the single market legislation but force acceptance of the four so-called EU freedoms, namely, the free movement of goods, services, capital and labour within the European Economic Area.
Minford was also on the right track when he pointed out the quite small part of the British economy which is devoted to exports (he put it at 10%). He was also generally confident of Britain’s ability to be successful outside of the EU.
Booker is a promoter of the use of Article 50 as the only means by which the EU could be forced to open negotiations. That begs the questions of what negotiations would result with the Europhile British political elite bargaining for Britain and the probable response of the EU if Britain simply announced it was leaving.
The answer to the former question is that the Europhile politicians who would be leading the British side of the negotiations would try to tie Britain firmly back into the EU. If Britain simply repudiated the European Acts which have led to her entanglement in the EU by repealing them that would make it much more difficult for the British political elite to tie us back into the EU. This is because Britain would immediately start operating in a post-EU world and British politicians would have to adapt to that reality whether they liked it or not.
As for the response of the EU elites, they would be unlikely to do much by way of creating heavy protectionist barriers against Britain both because of their healthy trade surplus with Britain and the many economic links between Britain and the rest of the EU and because of the World Trade Organisation’s regulatory framework which binds its members to pretty tight restrictions on protectionist barriers. It is also human nature to be more respectful to those who adopt strong dominant action than to those who display weak cringing behaviour such as has been the norm for British politicians dealing with the EU for over twenty years.
If leaving the EU means we cease to be covered by the many treaties signed by the EU which currently apply to Britain (Booker said there are around 700), so much the better for that would force a re-evaluation of the ones we wished of which to continue to be members. It is wildly improbable that Britain would be denied independent membership of any it chose to sign up.
Booker is also a supporter of the “Norwegian Option”. Hence, much of what he says about wanting Britain to be free of the EU grasping hands is pointless at best and dishonest at worst because the Norwegian Option” would still leave Britain within the coils of the EU.
Mary Ellen Synon
By far the most interesting speaker because she was the most realistic. Synon has worked in Brussels for many years and she is under no illusions about the corrupt and self-serving and above all ideological nature of the EU. Synon said there are instructions to Eurocrats about the language they use in public. They never say people always citizen as in “a citizen of the EU” The word country is used as little as possible and if a Eurocrat is talking about his own country he or she will says “the country I know best” not “my country”. She was generally scathing about British and other EU politicians.
According to Synon said the 2017 date for a proposed referendum was chosen because Britain will take the six-month rotating presidency of the EU Council of Ministers in the second half of 2017. This would give Cameron (or anyone else who is PM) and various cabinet members a great deal of opportunity to bring EU summits to Britain and to posture regularly in front of the cameras.
Synon is sceptical about a referendum being held even if Cameron is PM after the next election. She thinks he will try to wriggle out of it as he wriggled out of the promised referendum on the Lisbon Treaty. I think is unlikely because the situation will be rather different to what it was with the Lisbon treaty. The latter was accepted by a British Government before Cameron came to power. In this case he would be remaining in power. In addition, Cameron has nailed his colours very firmly to the referendum mast. It would be immensely difficult for him to renege on his promises because he would have no one else to blame but himself if the promise was broken.
But even if there is a referendum and it is won by a large majority, Synon thinks that the EU will do what they have done with other referendum reverses such as the Irish rejection of the Lisbon Treaty first time round. They will try to engineer another referendum. In the Irish case they did this despite a healthy vote against ( 53.4 percent against, 46.6 percent in favour) in the original referendum.
The tactic was dependent on the existence of willing collaborators in the Irish government. Synon had no doubt that a Cameron government would find such collaborators, not least because questioned by the Spanish newspaper La Pais in April 2013. Cameron was asked whether, in the event of a vote to leave the EU this question: “Would you be willing to leave the Union?” He replied “I would not”. (Synon described Cameron as collaborator).
Using the Irish example as a template, Synon then outlined in gory detail what were likely to be Cameron’s tactics if a vote to leave occurred . The government would not accept the vote. There would be a questioning of whether the electorate had understood what they were voting for. This would be followed by the commissioning of an opinion poll designed to either reject the result of the referendum outright or provide a pretext to hold another referendum on the grounds that the electorate had not understood what the first referendum really meant.
In Ireland another referendum had to be held because the constitution required it. In Britain there is no such requirement. The British government could simply ignore the referendum result unless Parliamentary action forced either another referendum or the respecting of the vote of the referendum which had been held that returned a vote to leave the EU.
Synon’s full notes for her speech can be found here http://www.eureferendum.com/blogview.aspx?blogno=84482
Dr Richard North
North began his speech by saying no referendum could be held in 2017 because David Cameron has committed himself to “substantial re-writing” of the Treaties before referendum. This he claimed would require an Inter-Governmental Convention (IGC) which would take several years to convene, agree changes and have the changes ratified by the various member states, some of whom would have a constitutional requirement to put the matter to a vote. In principle, Britain would be one of them because of the referendum lock” provisions in the European Union Act of 2011. This requires any substantial change to the EU treaties to be put to the British electorate. In addition, the 2015 European Parliament elections would mean that before any IGC could be called the newly elected Parliament would have to approve a new Commission, a process which North believes would take until the end of 2015. (http://www.eureferendum.com/blogview.aspx?blogno=84483)
The obvious objection to that is the fact that the EU has shown itself willing to disregard legal niceties when it suits them. Moreover, it all depends on what “substantial re-writing” would mean. It could be that Cameron (if it is he doping the renegotiation) will simply be tossed a few insignificant bones which the EU elite can claim can be managed within the present treaties. Alternatively, the British government might simply say this is the fruit that our negotiations have born and they will be incorporated into EU law in due course if the vote is to accept them and stay in the EU. It should be remembered that the Wilson renegotiation which led to the 1975 referendum were put to the British electorate without a Treaty change.
The interesting part of North’s speech dealt with the amount of law coming from Brussels which is in reality merely Brussels rubber-stamping decisions made by other supranational bodies. (North claimed that it was most of the EU regulations we toil under). This law is called Dual International Quasi Legislation. It derives from what North describes the EU as having become, namely, “part of a nexus of legislative bodies, linking international agencies of the United Nations with regional, national and local bodies, to form one continuous, seam-free administrative machine.” (http://eureferendum.blogspot.co.uk/2007/03/sucess-of-eu.html)
The rather shadowy bodies which make such laws are the likes of the Codex Alimentarius Commission, (http://www.codexalimentarius.org/) which sets standards for the Food and Agriculture Organisation and the World Health Organisation, the Intergovernmental Panel on Climate Change (http://www.ipcc.ch/) and the Bank for International Settlements (http://www.bis.org/about/index.htm). The rules agreed by such bodies go through the EU legalising process on what is known as the “A List” without a vote.
Although the process may be rubber-stamping, it is worth noting that the EU is not legally bound to accept such agreements. However, it suits the EU elites’ purposes to do so because it fits with their anti-democratic supranational agenda for it restricts who makes the decisions to an even smaller group than would be the case if the EU instigated the regulations.
North is in favour of using Article 50 as an exit vehicle. He gives no sign of appreciating the potential damage which two years of prevarication by the EU could do or the opportunities for active collusion with the EU elite by the British elite to trap Britain once more within the tentacles of the EU.
His idea of using the “Norwegian Option” as a staging post to full independence is wishful thinking, because once a new settlement is reached it is highly improbable that a further referendum would be held for many years if at all, not least because the “Norwegian Option” would tie us into the four so-called EU freedoms and the general single-market obligations.
He spoke confidently but, unsurprisingly for a 15-year-old, said nothing of obvious importance. His appearance smacked too much of gimmickry.
An unasked question
Had I had the opportunity I would have posed a question which went unasked, namely, what should be done to tie down Cameron (or any other PM) to what will happen if there is a vote to leave the EU? We need to know before the IN/OUT referendum what the British government is committed to.
What should be done?
If a referendum is to be won the OUT camp must put forward a coherent and attractive message which goes to the heart of British people’s fears and anger resulting from British membership of the EU. Talking legalistically about invoking Article 50, negotiating for a relationship similar to that of Norway or Switzerland or mechanically reciting mantras about free markets and free trade will not do that. Indeed, it will drive voters away.
The British resent and distrust the EU because of the impotence of the British government and legislature to prevent EU law taking precedence over the will of Parliament. However, they are often unclear about which areas of policy have been subcontracted to Brussels. The OUT campaign must keep hammering home exactly how much cannot be done while Britain is entrenched within the EU.
The most important EU issue in British minds is indubitably immigration. That should be made the focus of the OUT campaign. Indeed, the more it becomes an anti-immigration campaign the better because mass immigration affects from the entirety of life. The primary ill is simply the fact that huge numbers of foreigners coming into Britain change the nature of Britain both generally – think of the laws against speaking freely and those imposing “non-discrimination” dictats on the grounds of race and ethnicity – and particularly, for example, here parts of the country are effectively colonised by those of a certain ethnicity or race.
Then there are the secondary ills which immigrants bring: the undercutting of wages, the removal of jobs from the open British market by ethnic minority employers who either employ only those of their ethnicity and foreign gangmasters who supply only those of their own nationality, the use of the NHS, the taking of housing (especially social housing) which forces up rents, the overcrowding of schools in areas of heavy immigrant settlement, the drawing of benefits by immigrants very soon are they arrive in Britain and a disproportionate propensity for crime.
A full throated campaign against these ills, which should encompass non-EEA citizens in Britain as well as EEA citizens, would be something the British electorate would instinctively and enthusiastically respond to. It would also allow those speaking for the OUT campaign to vividly illustrate the extent that the EU affects British life in all the important political policy areas.
The danger is that those running the OUT campaign will, because of the grip that political correctness has on modern Britain, turn away from immigration as a major plank in their platform or even shun it altogether. That will guarantee either a lost referendum or allow Britain to be re-stitched into the EU with something like the “Norwegian Option”.