So now we know. It must be true, because we have it from Nick Clegg, sometimes described as the Deputy Prime Minister (but often described in more colourful terms). If Britain leaves the EU — or even if UKIP does well in May, which looks increasingly likely — then the UK’s nascent economic recovery will be stopped dead in its tracks. Companies will leave Britain. Inward investment will dry up. Jobs will be lost.
I know Nick Clegg of old. Many will remember that he used to be an East Midlands MEP. He was elected in the region, as I was, in 1999, and in that first five-year term our paths crossed often. I must say I would have been flabbergasted if you’d told me then that one day he’d be Deputy Prime Minster. And to be honest, I still find it fairly preposterous. I suppose he must be in his forties, but he still has that air of a boy sent to do a man’s job. And as Talleyrand said of the Bourbons, he has learned nothing and forgotten nothing.
On seeing the report of Nick’s remarks, I tweeted
“Memo to Nick Clegg: Stop telling porkies. Outside the EU, Britain will become Europe’s Enterprise Zone, with lower taxes, energy costs etc.”
“I shall start to respect Nick Clegg’s views on the economy (just as soon as he’s spent as much time in international businesses as I have)”. (About 33 years, if you were wondering)
Clegg has an almost religious faith (or mania?) with regard to the EU. Like all current and former EU apparatchiks, he believes that the only solution to any problem in Europe is more Europe.
We have direct EU budget contributions of close to £20 billion (and it’s right to take the gross figure — we can largely ignore the money we get back. As I like to say “They give us back a little of our own money, they tell us what to do with it, then they expect us to be grateful”). We have independent estimates from both Patrick Minford and Tim Congdon that the total costs of the UK’s EU membership (including regulatory costs) are 10 to 11% of GDP. Leaving the EU will therefore be a huge economic boost.
The threats about the loss of “3 million jobs”, and disinvestment, are simply a re-play of what Clegg was saying ten years ago when we declined to join the €uro. He was wrong then. He’s wrong now. While Carlos Ghosn threatens to leave, Ford van production actually has left the UK — to go to Turkey, outside the EU. If Ford can service the EU vehicle market under a free trade deal from non-member-state Turkey, then so can Nissan from the UK after Independence Day.
Outside the EU, Britain can have lower taxes, much lower energy costs (when we’ve got rid of Cameron’s “green crap”), more flexible labour markets, more global free trade agreements — what’s not to like?
It’s interesting that a recent report from the CEBR reckons that Britain will be the fastest growing economy in Europe, overtaking France in 2018 and Germany by 2030. Its Director thinks that leaving the EU might possibly be negative in the short-term, but would probably be positive in the long-term. One of the reasons advanced by economists for expecting Britain to do well is that we’re outside the €urozone. Pity poor Latvia, which joined the €urozone on January 1st, against the wishes of most Latvians. Compare this point with Clegg’s support for €uro membership ten years ago.
Yet bizarrely there are still some commentators suggesting that leaving the EU (or talking about it) is a downside risk for UK PLC. Some people say that if the UK recovery is going well (and let’s hope it does), let’s not rock the boat. This is strange thinking. If we can do relatively well while we’re still in the EU, paying over the odds for regulation, and energy, just think how much better we’ll do when we get out from under. Both our economy and our democracy will be Better Off Out.
The deep unspoken fear in Brussels is that a major country like Britain, on leaving the EU, will in fact demonstrate better economic performance. We will become, in effect, Europe’s Enterprise Zone, outside the EU but with better investment conditions, and full market access to the EU under a free trade agreement. This will finally give the lie to the myth on which the EU project is based. Here’s a quote I’ve used before, but I make no apology for quoting it again. William Pitt the Younger said it: “England will have saved herself by her exertions, and will, as I trust, save Europe by her example”.