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.
This argument is pretty strange. You don’t even bother to mention, even to dismiss, the various arguments against EU membership, such as the loss of national democratic control, or the around £15 billion the UK contributes to such projects as the notorious CAP policy, or the evident EU commitment to building an EU state for which there is no support among national populations, or the high “common tariff” or the demonstrated EU incompetence over such issues as the design of the Euro or the failure to handle the developing Euro-crisis over the last two years.
Not to mention that your arguments don’t follow. It may come as a surprise to you that you can be in a free trade zone with the EU countries without being in the EU, namely EFTA and switzerland. And the EU has numerous bilateral free-trade agreement with totally non-EU countries. Also, although immigration does generally boost GDP and innovation, it does not necessarily follow that the UK would leave the common movement area, that this would significantly cut immigration, or that this would push immigration below optimal levels given it is currently at record highs and UK infrastructure and community cohesion is arguably struggling to cope. Not to mention the obvious downsides of mass immigration in a country that already has high-unemployment. Certainly an argument from relatively tiny levels of high-skill historic immigration with present day high levels of mass immigration does not hold water.
The arguments you make are either not related to economics or foreign policy or are trivial in importance relative to the reasons I provided.
50% of UK trade is of immensely greater economic value than £15 billion in assisting the growth and development of other EU economies. The attachment to sovereignty is only valid if there is demonstrable evidence that the EU does not support the British interest; here I have provided a series of arguments that it does. Public opinion is of no argumentative value on its own–the people do not support an EU state not because of any economic or foreign policy consequences that they seek to avoid, but out of nationalism and xenophobia. The UK is not part of the Euro and so the condition of the Euro is not relevant to its membership.
I am well aware that the EU permits some countries access to its free trade arrangement without membership, but were it to do so in the British case it would undermine its ability to retain Britain as a member. The rational move for the EU is to threaten to revoke its free trade arrangement with Britain if it chooses to secede so that it can retain the benefits it receives from having the UK as a member state. I make the same argument with regard to the common movement area–the EU will not permit Britain to enjoy the benefits of being part of the EU while it refuses to contribute to it as a member. The EU will not treat a seceding state the same way it treats a neighbouring friendly state.
High unemployment and poor growth discourage immigration on their own–people will not immigrate to a country where their future is unlikely to be prosperous. For this reason, immigration to the UK is down from its pre-recession peak:
The UK can reverse the fall in immigration by improving its economic performance, but barring that immigrants will continue to adjust their migration behaviour.
While the figures for migration to the UK in the middle ages and early modern period are not specific, the US migration in the 19th and 20th centuries was primarily mass numbers of poor, unskilled workers, indicating that the skill level is not particularly relevant–all immigration is good immigration, because the more people you have, the more productive you are. Immigrants do not merely contribute to labour supply, they fuel domestic demand with their consumption.
The things I mentioned aren’t irrelevant because you haven’t provided any actual argument as to why we would necessarily lose any of our trade or suffer any defence risk. Your blanket statements about what the EU will do are actually entirely hypothetical guesses, which contradict the EU’s actual behaviour towards non-EU states, as well as Angela Merkel’s actual statement on the speech. Especially since the EU has as much to lose by threatening free trade with the UK and one could equally argue would rather have a happy friend in Britain outside the EU rather than have Britain within complaining about every single thing the EU tries to do from within. Especially since we run a significant trade deficit with the EU.
Nor have you offered any realistic argument about why the UK would be in danger outside the EU. NATO would still exist and we would still have European and American allies. The EU would actually be more likely, I would argue, to be able to get a working EU army together without us inside. It may modestly reduce our influence with the US. But I fail to see what great gains in the world our current level of influence is getting us. And one could perfectly well argue that greater freedom of action would allow us to hold more influence, rather than being tied to a cumbersome and bureaucratic EU.
The fact that EU has so badly handled the entire Euro saga is relevant. The fact the people who would be governing you are proven incompetents is very relevant indeed to any country. I would think someone who supports ‘rule by the wise’ would appreciate that. Personally I am in favour of staying within the EU, but your specific arguments are pretty weak, and rely on quite massive assumptions about the way things may turn out. It certainly doesn’t amount to an open and shut case that you claim. Nor does Cameron’s policy necessarily lead to EU-exit.
Unless you are willing to make what I would argue to be a very large assumption and assume that the European Union would allow Britain to leave it without any repercussions, without revoking any trade privileges or immigration privileges or defensive arrangements, my arguments in these areas are quite sensible.
The EU gains much from Britain’s contribution; do think it would really be willing to allow Britain to continue to reap the benefits without paying into the system? I concede that there is no guarantee that the EU will penalise Britain in these ways, but I see no reason for it not to do so, or at least threaten to do so in order to prevent a British departure. These other countries you speak of were never part of the EU and they are much smaller and have much less to contribute than a large economy like Britain has.
By refusing to remain part of the EU, Britain alienates its European and American allies who will be less enthusiastic about helping it in future. While that alienation may not be strong enough to cause these allies to abandon Britain in an existentially threatening situation, it could very well lead to a large decline in British influence in international negotiations. Already British unwillingness to participate in the EU relegates it behind both Germany and France in its clout among European powers, and already the United States begins to prioritise Germany’s input over Britain’s. What influence remains to Britain is threatened by its isolationism.
The EU’s combined clout in terms of military and economic power is vastly greater than that of any one country, and by being part of the EU, Britain’s influence is magnified. Leaving the EU means that when Britain speaks, it does so not with the power of Europe behind it, but alone. I fail to see how that leaves it any stronger negotiating position with any country. The more power one is seen to command, the more friends one has and the closer those friendships are, the more influence one will have. Were Alabama or Scotland to be an independent country, the influence their respective citizens would have over geopolitics would be vastly diminished, would they not?
Britain is not on the Euro, so Britain is not adversely affected by the mistakes made by the European Central Bank and the German government in managing the Eurocrisis. To say that the incompetence of the EU’s monetary policy is proof of incompetence in other areas of EU bureaucracy, as you seem to be arguing, is not logical. Absence of skill in one area does not imply absence of skill in another.
Cameron has stated his goal is diminished European control, but whether he achieves that and stays in or fails to achieve that and gets an exit, the net outcome for Britain is diminished influence relative to Germany in the long-term, and consequently less long-term control over the destiny of Europe, a destiny which, whether it likes it or not, directly effects its future.
I admit that much of what I am saying is necessarily speculative, because a British exit has not yet happened and therefore the conditions of that exit cannot be predicted with certainty, but it would be absolutely mad for the EU to set a precedent of letting nations leave the EU with no negative consequences. It is the political equivalent of Abraham Lincoln choosing to let the south go.
Reblogged this on CaribbeanMarvel and commented:
Given my post http://caribbeanmarvel.wordpress.com/2013/01/17/britains-attempt-at-an-a-la-carte-european-menu-over-tones-the-caribbean/ I believe the perspectives in this post will be helpful to my readers. I especially note the issue relating to immigrant. It gives a view on integration and immigration which we in CARICOM should consider; secondly it help us look at our people role in Britain as immigrants. I will consider some of the views at make a posting soon.
Much thanks for sharing it!
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