David Cameron’s EU Referendum
by Benjamin Studebaker
British Prime Minister David Cameron has pledged to hold an in-out referendum on British membership of the European Union by 2017. This is a very bad idea. Here’s why.
Firstly, it should be understood that there is a real chance that the British could vote to leave the European Union. 53% of British people recently polled say that, should the EU be unwilling to return many powers of sovereignty to the British government, they would vote for EU withdrawal. The nature of the referendum guarantees that either Britain leaves the EU or the status quo prevails, so, provided that we support EU membership, the vote can only lead to either a continuation of present circumstances or a worsening of them.
Of course, I may be getting ahead of myself here–the reader may not as yet be convinced that EU membership is in the British interest. So let me submit to the reader the reasons why leaving the European Union is the wrong move for the British people. They can broadly be divided into two categories:
- Economic Reasons
- International Relations Reasons
Let’s explore each.
The first key economic reason for British involvement in the EU is that maintaining free trade with Europe benefits British trade. The amount of trade Britain engages in with Europe is enormous–approximately half of all British imports and exports come from or go to an EU member state. Without EU membership Britain doesn’t get free trade with Europe, it doesn’t get to exploit its competitive advantage over most European economies for its economic benefit, it sees higher prices for consumers, and it sees poorer economic performance for its businesses.
The second key reason is immigration. Many people in Britain are nervous about mixing their nationality and culture with foreign immigrants, but the historical pattern is for the countries that attract the most immigrants to be the most prosperous nations. In The National System of Political Economy, Friedrich List notes how immigration led to Britain’s early industrial development and the prosperity stemming there from:
Great, however, as have been the advantages heretofore mentioned, they have been greatly surpassed in their effect by those which England derived from immigrations attracted by her political, religious, and geographical conditions. As far back as the twelfth century political circumstances induced Flemish woollen weavers to emigrate to Wales. Not many centuries later exiled Italians came over to London to carry on business as money changers and bankers. That from Flanders and Brabant entire bodies of manufacturers thronged to England at various periods, we have shown in Chapter II. From Spain and Portugal came persecuted Jews; from the Hanse Towns, and from Venice in her decline, merchants who brought with them their ships, their knowledge of business, their capital, and their spirit of enterprise. Still more important were the immigrations of capital and of manufacturers in consequence of the Reformation and the religious persecutions in Spain, Portugal, France, Belgium, Germany, and Italy; as also of merchants and manufacturers from Holland in consequence of the stagnation of trade and industry in that country occasioned by the Act of Navigation and the Methuen Treaty. Every political movement, every war upon the Continent, brought England vast accessions of fresh capital and talents, so long as she possessed the privilegesof freedom, the right of asylum, internal tranquillity and peace, the protection of the law, and general well-being. So more recently did the French Revolution and the wars of the Empire; and so did the political commotions, the revolutionary and reactionary movements and the wars in Spain, in Mexico, and in South America. By means of her Patent Laws, England long monopolised the inventive genius of every nation.
British history is a history of Britain absorbing and benefiting from the talents of immigrant labour. The United States famously benefited immensely from immigrant labour in the 19th and 20th centuries, using that manpower to populate its territory, augment its production, and increase the social dynamism of its society. To turn away immigrants is to turn away productivity and the future of a nation. Far from a reason to ditch the EU, it is a reason to keep it. Where do most of Britain’s immigrants come from? The European Union:
Here we can see that, of the 7.84% of non-British citizens who were employed in the UK as of 2010, very nearly half came from European nations (either the original EU14 members, or the recently added EUA8). Of the visas granted by the British government, the single largest receiving group is EU citizens, even greater than those coming from commonwealth nations. By closing down its open borders by leaving the EU, Britain would lose out on one of the greatest benefits of its EU membership, its net intake of EU citizens. In sum, leaving the EU would amount to a trade and migration disaster for Britain.
International Relation Reasons:
It is also essential that Britain remain in the EU for the sake of its national security and long-term global influence. In so far as British foreign policy goes, one of the following will become reality:
- The United States will halt or recover from its relative decline and remain dominant.
- The United States will continue to decline or accelerate in its decline.
British security is tied to the United States. If we look at defence spending, Britain is far, far weaker than the United States. It spends 2.6% of its GDP on defence, compared to 4.7% in the United States. Given the larger size of US GDP, this difference is far greater than it appears–it amounts to $711 billion a year in the US, compared to a mere $63 billion in the UK. That’s 11 times more defence spending in the states. The United Kingdom is not capable of self-defence without the American alliance.
As a result, if the United States declines, the United Kingdom will need other allies to help it to protect itself. The logical source of these allies? The European Union. Combined together, EU defence spending is good for around $260 billion, still much smaller than that of the United States, but at only 1.6% of European GDP, there is room to increase the figure in times of danger. It should be noted that at $260 billion, the figure is still $130 billion larger than what China spends and nearly $200 billion larger than what Russia spends. If Britain leaves the EU and isolates itself from its European neighbours, it could find itself alone and in danger in a post-American future.
And if the United States sticks around? If Britain expects American defence, it must offer the United States something in return. Britain is a critical ally of the United States in part because, among all the European countries, it most closely represents and defends the American interest. The United States cannot afford to lose the British voice within the European Union–the UK is its inside guy. For this reason, the Obama administration is already leaning on Cameron to keep Britain within the EU. Leaving the EU consequently isolates Britain not only from its European allies, but from its American ones. An isolated Britain may well struggle going forward not only to defend itself but to achieve its foreign policy agenda, to have significant influence in world affairs.
Taken together, what we see is a policy proposal (leaving the EU) that relies on an emotional jingoist nationalism about British sovereignty in combination with xenophobia directed against immigrants to persuade Britons to abandon clear economic and international advantages. Those advantages are complex and rely on understanding sophisticated political concepts that ordinary Britons do not have the education, the time, or the inclination to fully comprehend. By promising this referendum, David Cameron endangers his country’s interests for the satisfaction of a coalition of nationalists and xenophobes whose pro-British and anti-European bigotries have overwhelmed their own good sense and objectivity. There is no economic or foreign policy argument for abandoning the EU. We are only talking about the notion in the first place because British politicians themselves are ignorant and buy into the ridiculous.