160 countries around the world are not members of the EU but they are able to trade quite successfully with EU member countries. The main aim of the Stay in campaign is to terrify UK voters into thinking if we leave we uniquely will be unable to sell into the EU single market. Those who like Europe are so unpleasant about our partners in Europe as to think they will spite us on exit. It’s a strange paradox that those of us who wish to leave think more kindly of Germany and France than those who wish to stay.
As I have often pointed out, we are more customer than supplier as we buy more than we sell to the rest of the EU. As such Germany and France will want to keep our trade. As they will wish to continue with favourable ways to our market, they will not be looking for ways to stifle our exports, as we could simply impose the same restrictions on them.
The problem with the Single market is it is not a free market. The UK would like a free trade agreement with the rest of the EU, but that is not on offer if we stay in. Instead we have to pay large dues to the club and accept an extraordinary range of rules and restrictions on what we can do. We are told we have influence over these, yet history shows that we have lost many arguments. Our belief that we need fewer EU rules and regulations gets lost in the passion to drive through yet more agreements and directives.
Out of the EU there would be one huge improvement. All the rules and regulations we have to impose on all our business and trade would only have to remain on those goods and services we supply to the EU. Domestic activity and exports to non EU countries would no longer have to be under those same rules. At one bound we could be free for all but the 12% or so of our GDP that depends on sales to the rest of the EU, whilst that would have the same rules as today.
It is a nonsense to say that outside the EU we would be on the end of a facs telling us how to behave. As a supplier to the US, China, India or the EU we of course need to respond to what the customer wants. At the moment we are at the end of facs having to accept all the rules and regulations of an overregulated market and impose them on everything else. That is what we can free ourselves from.
Unfortunately the EEC/EU was never just a common market. It was always a journey to political union. Now it is becoming a wild ride it is becoming increasingly obvious that this is no market, but an excuse to create a government of the EU.
November 3, 2015
Exactly right.
It is indeed “becoming increasingly obvious that this is no market, but an excuse to create a government of the EU”. Obvious to all but Cameron, Osborne, the majority of the Tory Party, the Libdims, Labour, the BBC/Guardian and the Greens it seems.
It may of course be obvious to all these too, but they aspire to this so dare not admit this truth to the public.
November 3, 2015
I think they all pretend not to see what the EU is about.
Labour and the LibDems have long seen the EU as a way of blocking those ‘nasty, selfish Tories’ and for many years the Tories feared the EU as too far to their left and a threat to their ability to govern the UK.
I wonder if Cameron sense a swing to conservatism in the EU (now he has moved the Tories closer to centre ground) and the opposite is now true?
Whatever the case, I want a UK government able to change every law if they so wish, even if it means I suffer a party I didn’t vote for.
November 3, 2015
Lifelogic.It is obvious to them-it surely cannot be otherwise- but its the love that dare not speak its name (at least in public);the UK is just too small for them,they aspire to influence beyond these shores even if it means selling the country out to achieve it.
November 3, 2015
Likewise, the statement by the US Trade Representative that America is “not in the market” for trade deals with individual states and would only consider free trade agreements with blocs of nations is a lie designed to scare us to stay in.
Why should blackmail endear us to our political friends in the EU?
And why should the government continue to support the EU-funded CBI if it is likewise engineering distorted ………… surveys to give the impression that 9 out of 10 businesses prefer staying within the EU?
etc ed
No wonder opinion polls have been so wrong on general elections and public opinion towards migration and EU in the past: it’s because they’re all produced by Europhiles who put self before principle.
November 3, 2015
The US trade representative failed to mention that he had previously worked in the European Commission as a member of the Forward Studies Unit.
November 3, 2015
John,
With regard to the recent remarks from the USA, who it seems are ‘not looking to make any new trade agreements’, I notice David Cameron is not showing any sign of taking offence given our much lauded ‘special relationship’ with them?
By the way, last night I re-visited your Oxford Union debate “Why Socialism Doesn’t Work” .
Your traffic lights versus roundabouts was a pleasure to watch again with the added spice of Mr Corbyns’ facial expressions as you delivered it!
Reply Thanks! Few believe the next President of the USA will refuse to discuss a trade deal with the world’s fifth largest economy and long standing ally, the UK.
November 3, 2015
Good morning.
Of course we will still be able to trade with the EU if we were to leave. If we have something they want, and they have something to sell to us, there will be trade.
As for regulation. Much of the regulation we see come not from the EU but through international bodies – eg the Bank of International Settlements or ISO. On these bodies nations such as Norway sit and help formulate regulation. The EU sits on the same bodies representing ALL 28 Member Countries. So membership of the EU only gives the UK 1/28th of one say. Outside the EU we would have a say of our own and would sit on boards with equal status of the EU, the USA and China. We would help make regulation that Germany and France would have to adopt whether they wanted to or not.
The case for the UK to go it alone is very compelling in my mind and those who do not understand it lack the ability to argue for it. Hence they resort to scare tactics.
November 3, 2015
All very sensible comments.
Indeed the explanation is so very simple, it is no wonder so many politicians do not understand it, as its not in their usual complicated language.
Keep up the good work JR.
November 3, 2015
Yes. It seems the choice is clear:
Stay. UK will then in due course, inevitably, join the euro and become a state in a federated EU. The NY to Germany’s Texas or California or whatever.
Leave: Become independent trading partner to the EU and RoW. To take the analogy above to breaking point – Canada to the US. Although Canada’s trade is 85% or so with US while UK’s similar proportion is much less.
I am struggling to understand why anyone would vote to stay.
November 3, 2015
Some older people may vote to stay this time because they have forgotten what they thought they were being asked to vote for last time, and it hasn’t occurred to them that forty years on it has changed radically without any fresh referendum being held at any point during that process in order to check whether we were OK with the latest proposed changes, and that in forty years time it will have inevitably changed again into something that they may or may not like.
November 3, 2015
What answer would you give to the retired mandarins’ letter to the Sunday Times which said: (1) replacing 50 trade deals around the world will take years and may result in worse deals for the UK than we now have under the EU given we are much smaller than the EU; and (2) many international businesses invest in the UK because we are in the EU and have guaranteed access to the EU market (I assume they mean tariff free)?
Reply No-one is trying to stop us having access to the EU market, as they will wish to continue to have access to ours on good terms after we leave. There is no threat to our trade.
The UK civil service could negotiate trade deals for us with China, India and the USA, three big ones where there is no EU trade deal to lose!
November 3, 2015
As an aside, JR, tomorrow is the sixth anniversary of Cameron’s announcement of his abject surrender on the Lisbon Treaty:
http://conservativehome.blogs.com/files/david-cameron-europe-statement.pdf
and I wondered whether you intended to write anything about it.
Quite interesting to look back and read that document, which was of course intended just to string along his party and the general public for a bit longer, and see how his demands for change in the EU have now been diluted down to homeopathic levels.
Personally I don’t believe that homeopathy works.
November 3, 2015
All absolutely true. I do not know whether the creation of the Euro was a cunning plan or one of those accidental events that became a cunning plan. It has proved the cement that binds all those that joined it, an event that could not have been achieved through consensus for a political union. Now deep political union is probably the only way to make it work. Whether the citizens of Germany, who will pay, or the citizens of the Mediterranean, who will loose their nationhood, can accept this is another matter. For sure it is not for us on the grounds of democratic deficit alone.
November 3, 2015
Except much/most regulation is decided at a global level & the EU is just a middleman passing it on to member states. Of course, when we leave the EU we will regain our seats on the global regulatory bodies (UNECE, Codex etc.) with correspondingly far more influence that we have at present.
November 3, 2015
“The problem with the Single market is it is not a free market.”
Well, maybe that can be seen as a problem from a certain economic perspective, but for me the much greater problem is constitutional, that every new law which is imposed upon our Parliament by qualified majority voting is a denial of its sovereignty.
It would be a different matter if our government and therefore our Parliament had a veto on all EU proposals, as we were promised would always be the case during the campaign for the 1975 referendum, but that was not entirely true even then and is far from the truth now that swathes of vetoes have been abolished by later treaties.
But Hammond ruled that out in the summer:
http://www.theguardian.com/politics/2015/jun/07/philip-hammond-foreign-secretary-rejects-mps-demand-uk-veto-eu-laws-andrew-marr-show
and as we now see Cameron has no intention of even asking for any treaty change.
November 3, 2015
We have got to get of the EU train as it careers towards More Europe. This will end either in a Commonwealth of Poland or a very nasty dictatorship. It simply has to in order to survive.
There will be casualties. There will be people who do very well. There will be a need for real, bold leadership. If we, however, are not up for the challenge, we deserve what is coming to us if we do not LEAVE.
November 3, 2015
I voted for a common market and I still would . The EU as it stands is an hypocrisy to its original intentions; it has since become a a lacky to Germany and a haven to bureaucrats who receive huge salaries and little or no control . There are signs that it is crumbling ( the mess over the migrant crisis and the re-instating of border controls ) ; once the Euro was introduced , the disparity of the member countries has become wider and wider .
The argument that it is economically sensible for us to stay a member of the EU is flawed from whichever angle it is looked at , but , at the top of the pile is the need for us to re-establish our sovereignty and to get on with stamping our own image and place in world affairs .
At the moment we need to bring under one hat the various sections of the “Out” campaign . We are only a few months away from when things hot up and we do need a co-ordinated approach to succeed .
November 3, 2015
I’m afraid I have to correct you on that: the “original intentions” were always to gradually wangle the nation states of Europe into a new, single, federal, nation state of Europe. That was clear in the Schuman Declaration of May 9th 1950 urging the establishment of the European Coal and Steel Community, which the present EU takes as being its starting point:
http://europa.eu/about-eu/basic-information/symbols/europe-day/schuman-declaration/index_en.htm
“The ECSC (founding members: France, West Germany, Italy, the Netherlands, Belgium and Luxembourg) was the first of a series of supranational European institutions that would ultimately become today’s “European Union”.”
And what did that Declaration say? That:
“The pooling of coal and steel production should immediately provide for the setting up of common foundations for economic development as a first step in the federation of Europe”
“By pooling basic production and by instituting a new High Authority, whose decisions will bind France, Germany and other member countries, this proposal will lead to the realization of the first concrete foundation of a European federation indispensable to the preservation of peace.”
That has always been the intention, to strip the UK state of its national sovereignty and legally subjugate it within a European federation which would itself then be a sovereign state, it’s just that our politicians preferred to pretend otherwise.
November 3, 2015
Well spotted. Its a state controlled market, as such I have always been surprised at the number of Conservative politicians who give the single market their support, usually citing some need to be in the EU in order to ‘influence’ the development of it, which begs the question of if they really understand what a market is, for if there is a bureaucratic controlled market, it is questionable if it is a market any more, it is certainly not a free market.
As for the ‘influence ‘ there has been an erroneous acceptance that influence can only be had round a table where worthies decide what argument is the correct argument, usually resulting in an approved policy based on what has past rather than what is going to face us, removing the power of the market to drive development , the most powerful influence of all, for those that ignore the success of others are destined to be out of business the next day.
November 3, 2015
John Redwood and Lifelogic are absolutely spot on.
November 3, 2015
You make a very clear statement of the situation. The fundamental issue is political.
November 3, 2015
David Cameron has now joined the scaremongers and truth distorters of the remain in groups. He is according to EU Referendum blog(I have every reason to believe that this blog although biased towards leaving and tending to negativity houses very competent analysts) telling porkies about the Norwegian option. He stated that Norway out of the EU has to accept 75% 3/4 of it’s rules. They say that this is completely erroneous and the figure is in fact 21% 1 in 5. This and other distortion of the facts (CBI and the US government are now being accused of it) has to be exposed and stopped otherwise the gullible and credulous who do not verify before they blindly accept these lies and there are very many of them will vote to keep the UK in the EU considerably reducing the leavers chance s of winning.
A free market is a place where the consumer has the broadest number of choices and real competition is allowed so that the best rise and the worst fall by the way side. The EU is definitely not that. It is a markets place where the most influential providers mostly Germany and France set the rules and those rules ensure the market works to their benefit. So the EU is protectionist and a closed shop market place. It is suppliers who benefits most from it and not the consumer which is the opposite of what markets are for.
If we leave the EU we cannot change how the internal market works at European level and if we remain in we do not have enough clout to change much either despite the remain in claims to the contrary (the record of the UK influencing much in the EU is dismal and amounts to very little the data is there that verifies that fact). However outside the EU we can influence at world level as some of rules of the EU market is controlled at that level. The UK out can go back to sitting at these world decision making tables and at least have more influence over the EU than we do know in being in it.
Strip away the scaremongering and distortions of the remain inners and it becomes glaring obvious that there is not one credible reason for remaining in.
November 4, 2015
JR kindly published a recent post recapping on Norway and EU law:
http://johnredwoodsdiary.com/2015/10/30/should-we-charge-germany-to-sell-us-their-cars/#comments
My conclusion:
“So I think the best answer is that if we left the EU but stayed in the EEA then we would immediately be free to dispense with about three quarters of the laws we now have which we have got from Brussels since 1973 when we joined the EEC, and we would only be obliged to adopt about a tenth of the new EU laws coming from Brussels in the future rather than having almost all of them imposed upon us.”
November 3, 2015
These facts are so stunningly obvious that they shouldn’t need repeating – sadly, of course, they do need to be publicised over and over again. I know that shouting isn’t what you do, John, but I think we now need some shouters across the media.
November 3, 2015
Reply to SM.
Can I suggest both Owen Patterson and Nigel Farage not so much as shouters but as forceful presenters of a logical argument. If you prefer incisive, there is Jacob Reese – Mogg. For surgical we have our host and Daniel Hannan. It is time in Parliament that the out campaign began destroying the opposition along the lines of Nigel’s forensic autopsies within the European Parliament.
November 3, 2015
Spot on Mr Redwood.
If you want to see the future of the Single Market look no further than what happened at state level to the banks.
Regulations were used to protect the large banks from the free market to the point where we now only have a handful left and those are protected or owned by the state. The state protection allowed them to make reckless gambles.
The losers are the customers and taxpayers. Under such a system the rich get richer and the poor get poorer
November 3, 2015
Thank you for posting this Mr Redwood, your points are excellent and I can identify with them strongly from my work on EU energy rules compliance. This sort of post should hopefully influence anyone dipping into your site for more information – something I think more and more people will do in the run up to the referendum.
It’s a shame Owen Paterson couldn’t be so persuasive when interviewed by Evan Davis on Newsnight last week – a lost opportunity as the overall EU piece on that programme I thought was balanced and Evan Davis’ questions were reasonable.
November 3, 2015
I like the latest from Agra Europe that if we leave the EU all our farmers will be bankrupt as the CAP subsidies will stop.
No mention that the money comes originally from the UK taxpayer or that the EFTA countries actually pay more to their farmers.
Is there no end to the lying and scheming of the Europhiles to protect their position.
Reply Vote Leave has already said we would simply pay all the farmer subsidies out of the UK Treasury once we no longer have to send the money to the EU in the first place!
November 3, 2015
I await the arguments from the Europhiles to explain why this country should remain shackled to an obsolescent socialist dream of Totalitarianism. What can the EU do for us that we are not perfectly capable of doing for ourselves?
According to IMF data, in 1960 (before we joined the EEC/EU), the UK was the fourth largest economy in the world. We joined de Gaulle and co 1/1/1973 and by the time of the referendum in 1975, we had dropped back to 6th position where we remained for 10 years, despite being a paid up member of the EU! In 1990 we fell back to 7th but by 2000 we had recovered to 4th position but at the expense of France and Italy. Spain, which had regularly held 9th position was out of the frame by 2010. It is predicted that by 2020 we shall hold 5th Position again with France, Italy and Spain et al, slipping down the table again. By contrast Germany has always been ahead of us.
It is clear that over the past 50 years, the EU has done very little to enhance the growth of its member States when compared with the rest of the world. To me, the EU are but an expensive middleman who interferes with every walk of life and constantly damages business potential with its excessive rules and OTT time consuming regulations. Far from enhancing economic growth, it seems to go out of its way to stifle it and always to the detriment of our producers and employers.
In a successful business, middlemen are normally swept aside to improve efficiency and lower their costs to increase turnover, profits and growth. With our membership of the EU with their layer upon layer of pointless bureaucracy that option is impossible.
If this country wants to grow for the future, we must unchain it from that redundant body that weighs us down and anchors us to a defunct dictatorship. The EU must be completely cut adrift from our shores and leave us to freely sail the world and independently expand our markets. All for our own future good and for the good of our offspring. There is no alternative.
November 3, 2015
John, the question of duties is a two-way street. If the EU wants to impose tax on goods ‘imported’ from the UK, of course that is their right. Naturally, we will be applying the same duties in return. This is a fantastic deal for the UK, because – as the UK runs a trade deficit with the EU – we will win twice over : UK products will become more competitive in the home market, and by playing fair, the UK will tax the EU more than they will tax us! I am still waiting to hear of any genuine, actual disadvantage to leaving the EU??
November 3, 2015
John, what are your thoughts on the attempt to get the expats voting in the referendum? Listening to the debate in the other place, they seem determined to frighten all expats, with respect to working, homes, medical care and pensions into voting to stay in.
November 3, 2015
” The main aim of the Stay in campaign is to terrify UK voters into thinking if we leave we uniquely will be unable to sell into the EU single market.”
Mr. Redwood, you are absolutely right.
In fact I would say that the Stay In campaign is trying to give the impression that something even worse will happen to the UK if we dared to leave the EU.
But the reality is that to vote to remain in the EU will mean that we are joining a group of countries who have no idea how this intended political union will end, particularly when its most powerful country wants to grow its population and workforce by importing people from a completely different region of the world rather than from the EU itself.
November 3, 2015
Wouldn’t it be lovely if Audi, BMW, Mercedes, MAN etc etc refused to supply the UK and we went back to building the worlds finest cars, motorcycles, trucks and buses ourselves. Don’t say we couldn’t do it. Take a look at Triumph motorcycles here in the UK (and yes OK some Thailand component) which now outsell Japanese machines over 500cc both in the UK and other markets.
November 3, 2015
While for the sake of a speedy and smooth transition it would better if we stayed in the EU Single Market, at least as an interim arrangement, it would not be catastrophic if we left the Single Market. Disruptive, yes, but not catastrophic, because the economic benefits of the Single Market have been vastly overstated.
The long term trend growth rate of the UK economy is around 2.5% a year. So even if the Single Market had actually produced the 5% increase in collective GDP that was originally projected, which it hasn’t, that 5% would only be equivalent to the natural growth of the UK economy over a couple of years.
It would mean, for illustration, that in 2025 might have the level of GDP which we would have attained two years earlier in 2023 if we has stayed in the Single Market.
But in fact the Single Market has not produced that projected enhancement of GDP, it has fallen far short, and there are some who say that its costs exceed its benefits.
Interestingly, in a recent speech an EU Commission Vice-President claimed that the Single Market had created nearly 3 million jobs:
http://europa.eu/rapid/press-release_SPEECH-15-5687_en.htm
and that 3 million is the number which has been touted by some eurofanatics as the number of jobs we would lose if we left the EU.
Only problem for them – that 3 million jobs is 3 million jobs ACROSS THE WHOLE OF THE EU, not just in the UK, and with about 223 million people employed across the EU the 3 million which he attributes to the Single Market amounts to only 1.3%.
The reality is that the overall economic benefit of the Single Market is not that significant, our politicians have been prepared to sell our birthright for a small mess of pottage.
November 3, 2015
“As they will wish to continue with favourable ways to our market, they will not be looking for ways to stifle our exports, as we could simply impose the same restrictions on them.” JR
There is also the point that if the EU won’t buy our goods anymore, it’s going to be devilishly difficult to buy their goods with the few Euros we have. Trade is a two way street and world imports MUST equal world exports. There is no reason to restrict world trade below what it might otherwise be.
Just listened to John’s interesting presentation on currency unions on IPlayer. Amazed that John was not made to include an interview with Will Hutton on what a jolly good thing the Euro was. After all, this was the BBC.
My sympathies were entirely with the journalist who pointed out that currency union did not necessarily mean political union. There have been many currency unions in the past which functioned without political union. Also, the journalist was spot on when he said that if banks go bust they should not be bailed out by the taxpayer. If someone buys shares they are told that they can lose money if their investment fails. If someone opens a deposit account expecting a return on it, they should likewise be told that the bank’s investment of their money could also fail. Banks do not possess a magic wand in this regard.
Reply I wanted someone to come on and tell me what was good about the Euro – it was telling no Uk person would! I agree UK taxpayers should not have bailed out banks with share capital, but I do think a Central Bank has a duty to stand behind depositors in a regulated bank, which the B of E did and the ECB declined to do in Cyprus and Greece.
November 3, 2015
I see that Osborne has urged Germany to strike a deal to reform the EU:
https://uk.news.yahoo.com/george-osborne-seeking-protection-non-eurozone-countries-eu-001046305.html#bHQrhFx
“So let me be candid – there is a deal to be done and we can work together.
Rather than stand in your way, or veto the treaty amendments required, we in Britain can support you in the eurozone (to) make the lasting changes that you need to see to strengthen the euro.
In return, you can help us make the changes we need to safeguard the interests of those economies who are not in the eurozone.”
Pity nobody in government thought about the possibility of some kind of quid pro quo back in the autumn of 2010, when Merkel demanded her EU treaty change to allow the eurozone states to set up their permanent bailout facility, the ESM.
Instead Cameron simply gave Merkel that treaty change, free, gratis and for nothing.
November 3, 2015
I watched your performance JR and that of the SNP MPs which included Mr Alex Salmond on NI/Europe in Parliament. Your frustration was evident on why Constituencies ( in the broadest sense of the term ), such as those haunted by the SNP are not up in arms at EU austerity and the denial of employment opportunities particularly of youth in southern Europe: everything would point that the SNP and even the rubber-stamped “Socialism ” of the Labour Party Corbynistas would be massively Eurosceptic.
Isn’t it a wonderment that “The Left” and the so-called “nationalists” of the SNP do not appear to have any common ground whatsoever with unemployed workers ( albeit in southern Europe ) and with the nationalist aspirations, in the case of the SNP, with nationalists in southern Europe.
The fact is, and the northern English industrial working class are learning and will soon be followed by Scots:… the SNP is not for Scots of any social class. And the English Labour Party does not give two hoots about the working class of any country incl. those of the UK.
Mr Alex Salmond is highly literate and most eloquent. Yet no Parliamentarian of any party including his own SNP is impressed. Mere ego grandstanding. How could he impress a Scot by making a silly quip that you JR advised the late Mrs Thatcher therefore everything she uttered was a product of your own mind?. Sadly, he smirks like Gollum sinking with his ring into the magma.
November 3, 2015
Great post here John and agree with everything you have written. Why oh why can’t Cameron see sense? I just hope the public do before it’s too late. We need people like yourself to be given more time on TV and radio to get the message across.
November 3, 2015
Another British manufacturing area goes to the wall. This time tyres in Ireland – because Asian imports are cheaper.
If we truly believe in saving the planet then should we be importing tyres made by dirty means ?
Otherwise adding taxes to energy is rather pointless and does nothing to save the planet and destroys our economy.
November 3, 2015
On the BBC the high cost of energy was mentioned, but the EU as one of main causes of the high cost of energy was not mentioned. Of course not.
November 4, 2015
“160 countries around the world are not members of the EU but they are able to trade quite successfully with EU member countries. ”
I have never seen/heard any details about these ‘successful’ arrangements. Are all these countries really happy with their deals – no complaints of unfairness etc.? I’m not saying they are not – just like to know.
reply. yes they are happy. If they were nog you would hear about it.
November 4, 2015
The Government, the Civil Service, Big Business, the BBC have all been lying about the consequences of EEC/EU membership for decades. They aren’t going to stop now.
They will never admit that the EU is a political union intended to result in a Federal Superstate and that we don’t need to be in it to trade.
All they have is scaremongering. Unfortunately and very sadly, a large proportion of the British electorate has been so dumbed-down by poor education and the media and infantalised by “big government” that it can’t think for itself and will fall for the lies.
November 5, 2015
Will you now agree that the nearest approach the Single Market made to free trade was when the Single European Act was implemented, and that each of the Maastricht, Amsterdam, Nice and Lisbon Treaties have taken us progressively further away from free trade and towards political union?
If you do agree, why are you not advocating that any renegotiation package should include the repeal of the UK’s Acts of Accession to those four treaties?
While we are about it, should not ANY Member State that doesn’t want to sign up to the Euro and a German dominated Federal SuperState be allowed to repeal their Acts of Accession to those treaties.
reply I do not agree with features of the single market. LEaving seems to me the easiest way to restore our democracy.