“The
Lord detests dishonest scales, but accurate weights are his delight.” (Proverbs
11:1)
I
write this article as a Christian and a democratic socialist. I am well aware there
is more than one Christian and socialist view
over the EU referendum. However, as a Christian I do believe biblical
principles should inform the way we decide our vote.According to some recent opinion polls the country will be voting to leave the EU on Thursday. However, if so I believe they would be doing so based on myth rather than fact. It's a classic case of adding 2 and 2 and making 5. People see more migrants. At the same time they see their pay stagnating, public services over-stretched and struggling and a housing crisis with rents and prices out of the reach of so many. They understandably assume these problems must all be linked to excessive immigration. But an examination of the actual facts shows that these problems all have entirely different causes and whilst immigration makes some of these issues more challenging it actually offers us the means to tackle some of those problems.
Unfortunately our own Prime Minister's actions have only added fuel to the Brexit fire and if we vote to leave on Thursday this will be his lasting legacy. Brendan Cox, the widower of the tragically murdered MP Jo Cox has said his government's migration policy is "a masterclass in how to get the crisis wrong; set an unrealistic target [keep immigration below 100,000], miss it, report on it quarterly and in doing so show a complete lack of control heightening concern and fanning the flames of resentment." At the same time his government's policies have only exacerbated the economic problems that have understandably got people so incensed in the first place; austerity-driven cuts to our public services, further reducing our affordable housing stock, cutting benefits to the working poor and doing nothing effective to deal with issues like zero hour contracts. Is it any surprise that so many people have only become reinforced in their beliefs that the country can't cope with all these migrants who, even if they didn't cause these problems, are only making matters worse? And is it any surprise that they want to give him and all our establishment politicians a bloody nose in the referendum by voting out? It's the one thing they feel they can do to control their own future and improve their lot. Sadly in doing so they are only likely to make their lives a whole lot worse. It's almost as if David Cameron was cleverly engineering the whole thing so that we leave the EU. Yet remaining in the EU is one of the few things he passionately believes in! Sadly we have a Prime Minister who is brilliant at presentation but very lacking in the more important qualities of judgment and wisdom. Yet he has those in spades compared to the man who will very probably replace him if we vote to leave on Thursday.
It does not help that so much of the referendum debate has been based on spin and distortion of the available evidence; “false weights and measures, causing many to vote completely disregarding any evidence and just go with their “gut” and vote out. People are understandably sceptical of relying on any of the so called evidence, with most of it channelled through partisan politicians and papers. Consequently, many will vote completely disregarding any evidence and just go with their “gut.” But in such complex decisions like this “gut instinct” is a very poor guide. This is not some form of higher wisdom. (And for Christians should not be confused with the promptings of the Holy Spirit!) Instead, it is nearly always determined by irrational thought processes, arising from one’s own limited direct experience and the subconscious influence of media messages and views of family and friends. As a guide to making the right decision you might as well just toss a coin.
God
has given us all an amazing gift- our reason- and we should use that gift
responsibly. Properly using any gift requires some effort. And that is
certainly true of using the gift of reason when deciding how we vote. This should involve
looking at and weighing up the evidence.
Some
might moan that politics isn’t really their “thing.” Some are into politics,
some are into football, some gaming, etc, etc. Well yes of course we all have different
interests, but considering how we vote is not a hobby. It is a gift for which
our ancestors fought and died. As citizens of this country we have a duty to
exercise that gift responsibly. To do that we do need to make an effort, at
least at election times, to explore the issues on which we are called to vote.
This is especially so in the context of a referendum which could determine the
direction of our country not just for five years but for generations.
I
myself struggled at one point to decide whether it would be better if the UK
was in or out of the EU. I therefore (somewhat obsessively my wife will tell
you!) spend a lot of time looking at the
evidence surrounding the issues, particularly from independent sources. This
article is the fruit of my rather amateurish research!
In looking at the evidence concerning the EU
referendum as a Christian (and consequently a democratic socialist) I
would suggest we should be asking the following key questions:
·
Will Britain
remaining in or leaving the EU be more likely to extend Kingdom values (not
United Kingdom values but Jesus Kingdom values!) both here and in the wider
world, i.e. what will most likely best promote peace and justice, especially
for the poor?
·
Will Britain
remaining in or leaving the EU be more likely to bring prosperity to people
generally here (and again especially the poorest) and in the wider world?
Peace
“Blessed
are the peacemakers.” (Matthew 5:9)
“If it is possible as far as it depends on you
live at peace with everyone.” (Romans 12:18)
For
70 years Western Europe has enjoyed something it had never experienced before.
Peace. Or at least the absence of war. (If we ignore our three Cod Wars with Iceland, all of which we lost!) For my generation war is something that only
happens elsewhere in the world. But for hundreds of years it was part of the
natural state of things in Europe. Most historians would agree that one of the
key changes in Europe that has ensured that lasting peace is the major European
nations all working and freely trading together through the European Union and
its predecessors. Agreeing the rules by which we work together can be messy and
difficult and requires compromises. But it is far better to be exchanging angry
words with each other than exchanging bombs and bullets. If we
leave the EU we risk the domino effect of other countries following and then
the collapse of the whole European project. This is something that other
European leaders are petrified could happen, given the growing nationalist
sentiment in so many European countries. It is also something that campaigners
like Nigel Farage are actually aiming to bring about. But be careful of what
you wish for, because if the European Union fell apart what would fill the
vacuum it leaves? The risk is that once the European nations were no longer working
together the natural order of things would be restored; division and war.
Indeed looking back at history the last time Western Europe was infected by a
virus of nationalism it did not end too well.
Many
also believe that leaving the EU could cause further threats to peace even
closer to home. Although Britain has been free from military war on its shores
over the past 70 years, long before Islamic terrorism we had known sectarian
violence and killings through “the troubles” of Northern Ireland. Particularly
through the efforts of our then Prime Ministers John Major and Tony Blair a
cross-community peace agreement was reached which has so far spared my own
children’ generation from the fear of Irish terrorism that clouded my youth.
Those two Prime Ministers have recently warned us of the threat to that peace
that Brexit would pose. Part of the more benign environment in Northern Ireland
is the free flow between and lack of borders with Southern Ireland. Brexit
would mean the South inside the EU and the North outside. The genuine fear is that Brexit
would inevitably lead to a re-imposition of Irish border controls since it
would be the UK’s only land border with the EU. This would be a worrying sign
and reminder of the sectarian tensions that still bubble under the surface in
Northern Ireland, an opportunity the die-hard remnant of terrorists would be
only too keen to exploit. This is one of the reasons why the people of
Northern Ireland are predominantly in favour of remaining in the EU.
I
wouldn’t claim that leaving the EU would risk a return to England’s wars with
its auld enemy the Scots. However, it is likely to bring division with and
divorce from Scotland. The UK leaving the EU is very likely to prompt a new
Scottish referendum (The effective position of the dominant party of Scotland,
the SNP). With the Scots overwhelmingly in favour of membership of the EU the UK
leaving is likely to tip the balance in favour of independence and bring the
end of the United Kingdom.
Justice
“Woe
to those who make unjust laws, to those who issue oppressive decrees, to deprive
the poor of their rights and withhold justice from the oppressed of my people…”
Isaiah 10:1-2
“This
is what the Lord Almighty said: “Administer true justice; show mercy and
compassion to one another. Do not oppress the widow or the fatherless, the foreigner
of the poor.” Zechariah 7:9-10
One of the main arguments put forward
for Brexit is the way unelected officials of EU undemocratically impose
oppressive laws on the UK, tying us up in its sticky red tape. How can we
ensure our laws are just and appropriate for the people of the UK when 75% of
our laws are imposed on us in that way?
But does this argument stand up to the
evidence? Does the EU control that much of our laws? And does the EU instead
tend to encourage just or unjust laws?
The way the
EU makes laws, although complicated, is not as undemocratic as is widely
thought, certainly compared to UK’s own law making process. Yes EU laws are proposed by unelected Commissioners,
but they are reviewed and changed by a democratically elected EU Parliament who
in fact appoint the Commissioners. The ultimate decisions on the main EU laws
to be implemented are made by the EU’s Counsel of Ministers, made up of the
elected leaders of the EU nation states. The fine detail of those regulations
are then drafted by EU civil servants just as UK civil servants do for most UK
laws. Bear in mind that the UK’s own law-making process is hardly a paragon of
democracy. Our laws are currently being made by the leaders of a party who
received only 37% of the popular vote, bankrolled into office by rich
individuals and corporations and their legislation is then reviewed by an
entirely unelected second chamber.
2 We have far
more control over EU laws than is recognised. We do lose some control over the areas of law covered
by the EU. We are only one of 28 EU states in the EU so we do not always get
our way. However, since 1999 the UK government only lost the vote on 3% of EU laws passed. In some areas of EU law we have our
own veto and we have opted out. For example, the disastrous Euro and the
completely open borders of the "Shenghem” agreement. The latter means we are
able to prevent illegal immigrants through patrolling our borders from France
and we can even check the credentials of
EU citizens seeking to enter Britain. In other areas it is true we have no veto. In
those areas the EU law does take precedence over any inconsistent UK law and
can then be enforced by both our own courts and the European Court of Justice.
However, I would suggest the control we give to the EU over a limited range of
our laws should be more accurately seen as a pooling of sovereignty with other
European nations. Through our own elected Ministers and MEPs we do have
influence over those laws and in many cases in fact they have been able to
drive forward rules and standards that have benefited the whole of Europe on
issues like climate change and trade conditions. Contrast this with Switzerland,
Norway and Iceland who are not EU members but to get access to the valuable
single market have to abide EU rules over which they have no control
whatsoever. Vote for Brexit and this could be our own fate. If we want some
sort of access to the free single market we too would have to accept many of
the EU’s laws yet have no control over them. So in terms of control and
democracy by leaving we could actually find ourselves in our worse position.
3 Through EU
legislation we can act much more effectively to tackle important global issues. The areas of law where we pool our sovereignty with
other European nations are overwhelmingly those where it is in our national
interests to work together with other nations to tackle issues that cross
borders and where a co-ordinated wider approach is needed. These include climate
change, international tax evasion, terrorism and other international crime and
of course fair trading conditions across the whole of the single market. The
latter includes issue of basic employment rights and consumer protection and
wider global trading conditions. Pollution and international crime
recognise no borders and by working with other European nations we can tackle
them more effectively. Furthermore, by pooling our sovereignty with other EU
nations in tackling international issues like international trade and climate
trade we have a much stronger voice and clout than if we were to speak alone.
500 million speak louder than 65 million. An irony of the damage done
to our own steel industry by cheap Chinese imports was that through the EU we could
have done much more to put up tariffs on these imports if it hadn’t been for
our own UK government blocking such measures. There will be other major global
issues and threats in the future which we can tackle far more effectively by
working together across Europe through the EU. Then through the louder voice of
the EU we can seek to influence the whole world. The most obvious such issue in
the foreseeable future will be tackling the rise of the robots that within the
next generation could destroy most of our jobs.
The vast
majority of our laws are made here in the UK and not by the EU. Nothing like 75% of our laws are made in Brussels.
How much is very difficult to work out. According to the House of Commons
library about 15 to 50% of our laws have been influenced in some way by EU law.
However, not all laws are equal in their impact on our everyday lives. Much of
the EU’s laws are very specific in regulating terms of trade in a myriad of
different industries. This is to try to make the single market operate in a
fair way, to ensure a level playing field for producers, transparency and
safety for the consumer and public. Some of these rules may seem annoyingly pedantic
and unnecessary to producers, e.g. how particular products have to be packaged
or described. However, many EU rules have no real impact on the
wider public. Of those that do have a wider impact many of the EU’s laws are
actually beneficial and make life better and fairer, often protecting ordinary
folk from injustice and exploitation by the rich and powerful. For
example, it is EU law we have to thank for the first serious health warnings on
cigarette packets (against which tobacco companies lobbied hard). In fact, much
of the rules that improve the safety of our environment and consumer products
come from the EU. Indeed, at this very moment the Supreme Court are forcing our
government to comply with EU law by taking action to reduce our air pollution
(which kills thousands of innocent victims every year). And through the
European Arrest Warrant the EU improves access to criminal justice, allowing us
to quickly grab and return to the UK criminals absconding prosecution here.
(Note by the way if you don’t like some of the decisions of the European Court
of Human Rights, eg over prisoner’s voting rights, that has nothing at all to
do with the EU, whose supreme court is the entirely separate European Court of
Justice).
5 Virtually all
the unjust laws imposed on us in reality come not from the EU but our own UK
government. The EU actually has
no or virtually no power over most areas of law making that effect our everyday
lives (as long as we treat EU nationals equally). Our health service. Our
education system. Our welfare state. Our housing policy. Our taxation policy
(save for VAT). Our armed forces and when and whether we go to war. The sort of
laws that God sees as unjust are not the petty fogging red tape that the EU
sometimes produces but rules that oppress ordinary folk and especially the
poor, depriving them of justice, a roof over their heads and decent standard of
living, rules that allow ordinary folk to be exploited by the rich and
powerful. Draw up a list of the recent laws and decisions by government that
you find most unjust. My own list would include; the illegal invasion of Iraq, the
bedroom tax, selling off large parts of our public services to be run by
private companies leaching billions in profits out of public funds, the growing
destruction of our social and affordable housing, oppressive and arbitrary welfare
benefit sanctions, reductions in welfare benefits causing poverty and
homelessness, massive restriction of legal aid and access to civil justice,
letting the rich get away with widespread tax evasion and avoidance, increasing taxes the poor cannot avoid whilst
reducing wealth/income tax for the rich. One thing all these have in common
apart from their injustice is their origin; our UK government, because that is
where the vast majority of the laws that affect our every lives are made. (In
fact I wonder if the EU really did have as much control over our own laws as
some people think whether we might have avoided some of these injustices!)
6 In employment
law the EU provide foundational underpinnings which our own government cannot
remove even if it wanted to.
These include minimum paid holiday and maternity/paternity leave, rights of
agency workers and maximum working hours. If you don’t think these would be
threatened if we left the EU, then look no further than our current employment
minister and Brexit supporter Priti Patel. She has advocated a bonfire of EU
imposed employment rules under the guise of freeing us from expensive “red
tape.”
7 We would not
help put right any injustices done to poorer nations by leaving the EU. Yes the EU itself certainly can be criticised for
causing injustice and oppression of the poor. Many rightly have been appalled
with the treatment of Greece and other poorer Southern European countries over
the Euro bail out forcing extreme austerity on them.Yes that was very bad but not
being a member of the Euro this has no impact on the UK and we have no
influence over it. And whether we leave or remain it will alleviate none of the
pressures on these countries. In fact, most economists would say it would only
make them worse because of the potential economic downturn that our leaving could
trigger throughout the EU and even the global economy. (Fears of the effect of
a potential Brexit on the world economy have already been seen in the global
stock markets in response to polls putting to Brexit). The EU could also be criticised in its response to the migrant
crisis from the Middle East. However, it did not cause the migrant crisis which
would be just as bad if not worse if the EU did not exist. (The open borders of
the rest of the EU did at least enable Germany for example to give sanctuary to
over a million refugees). It would certainly make no positive difference to
them if we weren’t a member of the EU.
The threat
from something like TTIP would be greater if we left the EU. Many
on the left (like myself) have been quite exercised by TTIP. This is the
proposed trade deal between the USA and the EU. As currently drafted it could
allow multi-national countries who have bought into government contracts, eg
with the NHS, to sue our government if the government tried to end those
contracts. If this happened this would be a most alarming and undemocratic loss
of control to private interests. However, many European countries including
France have voiced strong objecting to these provisions. The reality is TTIP as
currently drafted is virtually dead in the water. A greater fear I would
suggest is of something similar happening if we left the EU, (as John McDonnell
has recently pointed out). On that scenario a right wing government here
(probably headed by Boris Johnson) would be so desperate to do trade deals with
anyone that whatever objections Europe has to such empowerment of the
multinationals he would happily sign up to whatever terms the USA wanted to
impose as long as it gave us “free” trade. He has after all said that he
himself has no objections whatsoever to TTIP (and ditto our current Prime
Minister).
We
have to ask what is democracy? Democracy
by definition surely always involves surrendering some control over our lives
to some political authority for the greater good of the community. On
the lowest level our borough council has control over certain matters, meaning
that eg we can’t just park anywhere we like in our town centres without
incurring a fine or paying a parking charge. At another level our county
council controls certain things, meaning that eg we can’t just lower the
pavement outside our house to create a driveway for our car without getting
their permission. Above that our national government controls other matters,
meaning that eg we can’t drive down a motorway at 120 mph without getting
banned from driving. The EU then is a fourth level of government (or fifth if
you are Scottish or Welsh) which has control over certain other things, meaning
eg that if we’re a car manufacturer we can’t make cars that don’t comply with
certain emission standards (as ultimately VW found out!)
Prosperity
“So
God created mankind in his own image…male and female He created them. God
blessed them and said, “Be fruitful and increase in number; fill the earth and
subdue it.”” (Genesis 1:27)
“…there
need be no poor people among you, for in the land your Lord your God is giving
you to possess as your inheritance, he will richly bless you.” (Deuteronomy
15:4)
God
wants mankind to be blessed by and be fruitful in the world He has given us. In
other words He wants us to be prosperous. He also wants the fruits of
prosperity to be shared fairly so that the poor are provided for.
Are
we as a nation and as individuals likely to be better off or worse off by
remaining in or leaving the EU? And how particularly will this this impact the poorer
parts of our communities?
Cost of contribution to the EU
Our
contribution to the EU costs us “£350 million a week”. Or at least
that’s the Leave campaign’s slogan painted across their buses. That would be the
equivalent of £18 billion a year, money the Brexiters say we could invest instead
in our struggling NHS. The UK Statistics Authority has however told them that
this is a misleading statement. In other words, it is a lie. According to
the Institute of Fiscal Studies when you take into account our rebate and other
monies coming back to us the true cost is about £100 million
a week or about £6 billion a year. That’s a not insignificant sum but it's only about 0.3% of government annual expenditure. So the real
question is whether we get value for money for our £6 billion annual fee? I would suggest we get excellent value.
Cost/benefit of immigration in or out of
EU
The
alleged cost and burden of immigration on the face of it is a strong argument
in favour of leaving the EU. In
2015 net immigration into the UK was 1/3rd of a million, about half
of which came from the EU. That is the equivalent of a medium sized city like
Leicester. At this rate within 10 years the UK’s population would have
increased by over 3 million. And this
figure would further escalate when the likes of 76 million Turks join the EU. 20
years ago before the accession of the Eastern European EU countries net immigration
was well below 100,000 a year. And this remains David Cameron’s stated goal for
immigration levels. It is argued that the current high levels of immigration
place a huge demand on our already overstretched NHS, education system and
housing stock. It is further argued that such high numbers of immigrants
competing with us for jobs creates unemployment and depresses wages,
particularly for the poorest. Because of the EU’s free movement rules the
government has no control whatsoever of immigration from the EU and therefore
effectively cannot control immigration overall or plan for its demands.
But is EU immigration actually a burden
on the UK?
It
depends on how you look at it. In economic terms actually EU immigrants through
their taxes put more into the UK government coffers than they take out in terms
of benefits they receive or services they use. They are a £2.5 billion a year net
contributor. This is because most EU migrants are younger, fitter,
better educated and more economically active than the average UK citizen. They
nearly all just come here to work.
Furthermore,
most EU migrants come to the UK already trained and geared up for work. This
saves the UK billions in education and training, especially in specialist fields
like medicine, science and engineering. At
the lower end of the spectrum EU migrants also come prepared to do essential
jobs that UK citizens are often reluctant to do, such as care workers or farm
labourers.
In
terms of our NHS and care services per person EU immigrants actually place less
demand than the rest of us because they are young and fitter than the average
UK citizen. In fact, you are far more likely
to find EU immigrants caring for you or your family in hospitals and care homes
than being cared for. Although they make up 4.7% of the UK population
they account for 5% or our nurses, 10% of our doctors (already trained of
course) and about 13% of our care workers. Again they contribute more than they
take out.
Where
EU immigrants do however increase the burdens are in our schools and housing. Interestingly recent research has shown that on
average areas with higher immigrant populations actually tend to have slightly better
educational attainment. However, it is undoubtedly the case that in many areas
high numbers of children from EU immigrants have placed great strain on class
sizes and some of our schools are struggling to cope. Also it is undeniable
that in higher areas of immigration EU and other immigration has only increased
demand for housing thereby further exacerbating the level of rents and property
prices and stretching even more thinly our now quite meagre stock of affordable
social housing. Note however that they actually take up slightly less public/social housing per person
than average UK citizen- about 3% less.
However,
the
question must be asked since the government is £2.5 billion a year better off
from the taxes of EU immigrants why is it not re-investing that revenue to
support those areas bearing this burden by increasing expenditure on schools
and public housing to meet the increased demand? That is a fault of our
UK government not the EU and not the migrants. Since 1979 successive
governments have recklessly allowed our affordable public housing stock to
dwindle and since school rolls started picking up government has also failed to
invest in our primary and secondary education services. We are currently
suffering from a very unfortunate combination; demands of a growing population
fuelled by immigration and a right wing government that just leaves everything
to the markets without sensible planning and investment. We have the means to meet the
demands of immigration on our services and housing but the government are
failing to use them.
Does EU immigration actually create unemployment
or reduce wages?
Inevitably
there are winners and losers here. There are instances where EU immigrants
deprive UK citizens of jobs or undercut their wages or self-employed earnings. However, there are
also instances where EU immigrants’ activities have actually created jobs for
UK citizens or increased their wages. EU immigrants for example are on average
better educated and significantly more likely than UK citizens to start
businesses employing others. The overall picture therefore is actually neutral.
Unemployment has fallen and employment has risen since the recent increases in
EU immigration. In the boom times of 2003 just before the start of significant EU
immigration our unemployment rate was 5% and the numbers in work 28 million. In
2015 after the EU immigration surges our unemployment rate was still at 5% and
the numbers in work had increased to 31.5 million. There is therefore no
evidence that in net terms EU immigration has increased unemployment.
Wages continued to increase at a very healthy rate during the original spike in
EU immigration from 2004. It is true that in recent years wages in real terms
have remained much lower than they were before the crash. However, the increase
in EU immigration since 2013 has not seen wages fall further. In fact, wages
have gone up slightly. Recent research has shown that as an average across all income
groups including the very poorest in net terms recent EU immigration has very
slightly depressed wages but by the equivalent of 1% over 8 years. For a low
paid worker earning say £8 per hour this is the equivalent of 1p per hour. In
other words, in reality overall EU immigration has had no effect on wages one
way or another. What however has been a drag on wages is the post-crash
slump in wages that has still not recovered. But this has been an almost global
experience.
Leaving the EU, will solve our
immigration problems won’t it?
No.
Even if we left the EU this would not magically cure any problems we have with
immigration Whilst leaving the EU’s free movement zone would probably reduce net immigration, but probably not by that much, probably by a few
10,000s. Immigration to the UK would still almost certainly remain high by
historical standards for the following reasons:
- Even now most of our immigration comes from outside the EU. Until 2013 net immigration from outside the EU was double or treble that from the EU. Even now more migration comes from outside the EU. We could control and reduce this in theory but the government chooses not to for a number of reasons, including that many of those coming here are actually needed to do jobs here in our public services and private industries.
- We have an ageing natural population and a
reducing natural workforce to sustain them. We need a significant supply of labour from
overseas to help care for our elderly and do other jobs which not enough
of the natural population either want to do (eg farm labourers) or have
enough right skills to do (eg certain scientific/engineering jobs).
- The end of free movement would be a two way
street. 1.3 million Britons currently live in the EU taking advantage of free movement rules and
giving them equal access to healthcare and benefits overseas, eg older
folk enjoying their retirement in the Spanish sun. Our exit from the EU is
likely to mean many of them returning here when they lose their own
benefits of free movement and equal benefits. By definition
many of these returning ex-pats are going to be economically quite
inactive and likely to be heavier consumers of health and care services.
(Contrast this with the Eu immigrants we are likely to be turning away who
by and large are younger, healthier and working).
- There is likely to be a significant increase in
illegal immigration.
Currently with the assistance of the French authorities we are able to
police our border from abroad in Calais. French ministers have
already warned us that once we leave the EU they are unlikely to continue to
maintain our policed border in France.
But won’t the immigration levels just
increase if we remain, especially when Turkey joins?
Turkey
and other new countries are not going to be joining the EU any time soon. They have numerous conditions that they have yet to
fulfil before they could even be considered and even then it’s within our
control. We have a veto over them joining.
Immigration
levels from the EU may well reduce in the near future for a number of reasons. Most who have studied their trends believe they will. There
was an initial spike in immigration from Poland and other new joiners in 2004
which gradually reduced and the same may be true of the more recent joiners
which prompted the spike since 2013. The wider EU economy held back by the
problems with the Euro may well yet start growing more so that EU migrants may
become more evenly distributed. David Cameron’s deal to restrict access to
welfare benefits for new immigrants should also help reduce numbers. It is
therefore unlikely that EU immigration will continue at current rates, let
alone increase further.
Cost/benefit from international trade in
or out of EU
The
EU gives us free access without trade tariffs to the biggest single market in
the world of over 500 million people. It is the only market right in our
doorstep and 44% of our current trade is with the EU. 3 million UK jobs are
directly linked to it and many more jobs indirectly supported by those jobs. Even if your job apparently has
nothing to do with it you’re effected by our EU trade because money
coming into the UK through trade with the EU circulates around the economy like
oxygen carried in our blood. It also affects the price we pay for goods
and services we buy from Europe. Just as an example car manufacturers from
outside of the EU single market typically pay tariffs of at least 10% to export
to the EU (and that’s before the additional red tape that outside exporters
have to get through to enter the EU.)
Every
single serious economic organisation who has looked into has advised that if we
leave the EU the negative effects on international traditional would make both
the government and most of us significantly worse off than if we remained. The list of the organisations giving these warnings
is as lengthy as it is impressive, including: the Treasury, the Bank of England, the
Institute for Fiscal Studies, the London School of Economics, the National
Institute for Economic and Social Research, the OECD and the IMF.
In
fact, 90% of economists who have analysed the data and projected the likely
outcomes have all come to the same conclusion. The outcome will be either
fairly or very bad for our national and individual incomes. This is
expected to result in an eventual overall fall in the income the UK generates
each (Gross Domestic Product) of £26 to £55 billion a year. These
losses are expected due to a combination of factors resulting from leaving the
EU single market, including increased costs of imports, big reductions in
foreign direct investment, reduced productivity and reduced exports. Note
the implications for international trade go beyond the EU as the EU has trade
agreements with 50 other countries from which we would no longer benefit if we
left the EU.
Likewise the vast majority of larger businesses and employers have warned that leaving the single market would be damaging to business and jobs and many like Airbus, Siemens and Nissan and numerous finance houses have warned they expect to reduce investment in the UK if we left the EU.
Likewise the vast majority of larger businesses and employers have warned that leaving the single market would be damaging to business and jobs and many like Airbus, Siemens and Nissan and numerous finance houses have warned they expect to reduce investment in the UK if we left the EU.
As a knock-on effect the IFS also estimates that the
UK government itself will lose tax revenues of £20 to £40 billion every year.
Our current government in contemplating how it might meet that shortfall is
already having to consider significant reductions to some of the biggest areas
of government expenditure; the NHS and state pensions, or significant tax
increases.
An
additional loss which may be even harder to quantify is the expected damage to
our scientific research. This is
expected to suffer significantly from leaving the EU because of the
loss of substantial direct EU investment in science (about £8 billion
over 6 years, far more than our own government invests) and the
reduction in invaluable knowledge collaboration with leading scientists
throughout Europe. The losses resulting from this go beyond the
economic and for example could hamper the development of or our access to new
drugs which could relieve suffering and save lives. It is not surprising
therefore that 83% of research scientists oppose Brexit (and only 6% support it).
But won’t the costs just be borne by the elite? Won’t most of the country,
especially the poorest, be better off?
especially the poorest, be better off?
No.
The consensus is that the economic cost of Brexit would not be just born by the
rich. The pain would be evenly shared across the income distribution – every
group would lose by
broadly similar proportions including the poorest. Those in the middle would lose slightly more than others. The projections vary depending on the trade deals reached by the UK post Brexit. However, the average forecast is that the average household by 2030 would be about £4,300 a year worse off than if we had remained in the EU. Many economists are concerned that the negative economic effects of Brexit could well lead to another recession. Recent experience tells us that in a recession it is always the poorest who suffer most for two reasons; they have very little “fat” that can be trimmed and they rely most heavily on state support which is likely to be significantly reduced because of falling government revenues. We thought our welfare state and public services were already suffering badly enough under our government’s austerity cuts. It hardly bears thinking about just what state they will be in after a further £30 billion of post Brexit cuts.
broadly similar proportions including the poorest. Those in the middle would lose slightly more than others. The projections vary depending on the trade deals reached by the UK post Brexit. However, the average forecast is that the average household by 2030 would be about £4,300 a year worse off than if we had remained in the EU. Many economists are concerned that the negative economic effects of Brexit could well lead to another recession. Recent experience tells us that in a recession it is always the poorest who suffer most for two reasons; they have very little “fat” that can be trimmed and they rely most heavily on state support which is likely to be significantly reduced because of falling government revenues. We thought our welfare state and public services were already suffering badly enough under our government’s austerity cuts. It hardly bears thinking about just what state they will be in after a further £30 billion of post Brexit cuts.
Don’t the EU need us more than we need
them?
So surely the EU will just do a trade
deal with us?
No
and no.
It
is quite true that we import more from the EU than we export but that does not
mean they need us more than we need them. This is one of the common false weights and
measues of the Leave campaign. You need to look at it on a country by
country basis. 44% of our exports go to the EU. But no other EU country exports more
than about 10% of their exports to us. As a country therefore we have
more to lose than they do. In addition,
French car makers for example would no doubt be very happy to take a share of
our current car exports to Germany and both those countries will keenly look
for their financial services to remove ours from its current pole position.
Let’s be clear no one is suggesting we won’t still be exporting goods and services to
the EU it’s just that it will become harder and more expensive and therefore
less successful and less profitable with all that entails for jobs and
incomes here.
There
is not a single country in Europe that has secured a free trade deal with the
EU that has not had to accept free movement of people and the uncontrollable
immigration this can bring and
other key single market rules and also pay a significant contribution to EU
funds. This is a fundamental principle of the European single market. This is
exactly the situations that Norway and Iceland finds themselves
in, whilst at the same time having no say at all over the single market’s
rules. Switzerland, which has a partial free trade deal with the EU, recently
attempted to test the EU’s resolve on free movement by proposing to restrict EU
immigration. It was told that it would lose access to the single market and has
had access to the EU scientific community revoked (still only partially
restored). If we wanted to do a free trade deal we would have to accept free
movement and since this is the very reason we would have left the EU that is
just not an option.
Importantly,
the
EU will inevitably feel it has to punish us for leaving it if it is to try to
halt a domino effect of other countries following suit and the whole union
falling apart. We would get no preferential treatment. In fact the
opposite would be true.
But who cares about trade with Europe
anyway as we can just do our own trade deals with the rest of the world can’t
we?
We
should care because the European single market is the only market right on our
doorstep. Other major markets-
USA, India, China, Southeast Asia- are much further away and depending on the
industry can involve significant additional travel and logistical issues. Our
Chancellor has tried to cosy up to China and look where that’s got us? Cheap Chinese
steel dumped to the ruin of our own steel industry. If we leave the EU
undoubtedly new Prime Minister Boris will be desperate to deal whatever deals he
can with other countries. However, he will be starting two goals down.
First, the EU already has trade deals with 50 other countries. By leaving the
EU we will automatically lose the benefit of those trade deals which
initially will mean a reduction in our trade with and increased costs of
imports from many other countries. Second, once it’s eventually agreed them
(and these trade deals usually take many years to negotiate) it is
unlikely that the UK will get as good a deal as the EU (let alone a better one)
for the simple reason that we will only be speaking with the voice of 65
million rather than 500 million. We would therefore be a much smaller
market for other countries than the EU is. This is also a reason why in
countries where the EU doesn’t have a trade deal like the USA we are going to
be very much behind the EU in the queue .
But if we leave won’t reduced red tape
mean a big economic benefit?
An
economic benefit to whom? Be vey
wary of rich right wing politicians who cite the cutting of red tape as an
economic benefit. Much of the so-called EU red tape are rules and restrictions that
actually benefit and protect the ordinary citizen of this country; a
whole raft of employment, consumer and environment protections. No doubt there
are a few rich unscrupulous businessmen who would find themselves better off if
they were freed from such “red tape”. However, most of us would be rather worse
off for this. Other rules and restrictions are things we would have to comply with
anyway if we wanted to do any trade with the EU (even with tariffs) and
others
still are the sort of rules and regulations that we would devise for ourselves
anyway. There really is very little saving to be had from reducing EU
red tape.
… but what
else has the EU ever done for us?
Oh nothing apart from:
·
cleaner beaches and rivers
·
cleaner air
·
lead free petrol
·
restrictions on landfill dumping
·
a recycling culture
·
cheaper mobile phone charges (including
now no roaming charges)
·
cheaper air travel
·
improved consumer protection and food
labelling
·
a ban on growth hormones and other
harmful food additives
·
better product safety
·
single market competition bringing
quality improvements and better industrial performance
·
break up of monopolies;
·
Europe-wide patent and copyright
protection
·
no paperwork or customs for exports
throughout the single market
·
price transparency and removal of commission
on currency exchanges across the eurozone
·
funding to areas hit by industrial
decline
·
freedom to travel, live and work across
Europe
·
funded opportunities for young people to
undertake study or work placements abroad
·
free access to European health services
·
labour protection and enhanced social
welfare
·
smoke-free workplaces
·
equal
pay legislation
·
statutory holiday entitlement
·
the right not to work more than a 48-hour week
without paid overtime
·
strongest
wildlife protection in the world
·
improved animal welfare in food production
·
EU-funded research and industrial
collaboration
·
EU
representation in international forums
·
bloc
EEA negotiation at the WTO
·
EU
diplomatic efforts to uphold the nuclear non-proliferation treaty
·
the European arrest warrant
·
cross border policing to combat human
trafficking, arms and drug smuggling
·
EU-wide counter terrorism intelligence.
But can we trust economists?
Didn’t they say similar things
about the dire consequences for the UK if we didn’t join the Euro? Look
what a mess that’s turned out to be so thank God we didn’t listen to these
so-called experts then. No
they didn’t all say we should join the Euro and few said there would be
dire consequences if we didn’t. Economic opinion was very much divided
over whether joining the Euro would be good or bad for the UK, which is why
Gordon Brown wisely took the decision, supported by many leading economists,
not to join the Euro. This in fact has left us in the ideal economic situation in a
very much less than ideal Europe; we benefit from full access to the single
market without being dragged down by the disastrous Euro.
But didn’t they didn’t predict
the crash so why should we listen to their predictions now? No they
didn’t the economic crash but this is another false weight and measure.
With Brexit the economists are trying to predict the outcome of a known event
ie the UK leaving the EU. With the crash the economists did not know about the
events that caused the crash ie banks overextending themselves through subprime
mortgage lending. These were like millions of little micro events
happening under the radar. Very few people were conscious of this on a broader
level (therefore the few who were aware made an economic killing out of it- see
the film “The Short”) Economists were not aware of these micro events going on
and were not paid by anyone to advise about what the effects of them. If
economists had been told about what was going on with subprime mortgages then
no doubt many of them would have predicted the banking crash and economic
recession that followed.
But isn’t all too speculative? No one really knows what will happen
next year, let alone in 10 years
Yes it is speculative. All
forecasting, whether it’s the economy, sports results or the weather is speculative,
but expert professional forecasting takes all the known data about past
performance and conditions and then makes reasonable assumptions to predict
what will happen. Now it is true that no one last season would have
predicted that Leicester City would have won the Premiership, having so
narrowly escaped relegation the previous season and having so little financial
muscles compared to the big boys. However, this is very much the exception that
proves the rule. Since the start of the Premier League 23 years ago there have
been only two seasons when teams outside the London and Manchester “big boys”
have won it.
Take
e.g. the Treasury’s long-term economic analysis of Brexit from the EU. It arrives
at a central estimate that it would ultimately lower UK economic output 6.2 per
cent, amounting to an average annual cost to British households of £4,300 a
year compared to if we remained in the EU. This central estimate is based on the UK securing a
free-trade-in-goods relationship with the EU such as the one that has almost
been agreed with Canada. It is extremely unlikely that the UK would do any
better than that unless (like Norway & Switzerland) it were prepared to
accept free movement, which is unthinkable currently.
It is quite true to say that no one can be confident
that we will lose out by precisely £4,300 a year. Almost certainly that figure
will be wrong because yes of course there are lots of variables which are
likely to alter the eventual outcome. It could be rather less. But equally it
could be rather more. The figure calculated and quoted really is just a gage,
an indicator that things are likely to be seriously worse rather than an
expectation that it will be exactly that number.
This is why you need to take a broad range of
economic opinion rather than just one. However, with Brexit pretty much whichever
serious economist or economic organisation you go to (the LSE, the IFS, the IMF
etc etc) all say more or less the same thing. The likely longer term consequences
of Brexit are going to be somewhere between fairly or seriously bad for the
health of the UK economy, for the UK government revenues and for our own
individual pockets.
To argue that you can’t listen to the economists’
predictions because they can’t be at all certain about the precise number is
like a man ignoring his doctor’s advice to lay off the hamburgers and fizzy
drinks, because he can’t tell him how heavy you will be in 10 years’ time or
whether and when he will have a heart attack. No he can’t precisely
predict those things but he can be pretty sure that if you keep up the
hamburgers and fizzy drinks you will be rather fatter in 10 years’ time and at
serious risk of a heart attack or other health problems.
Some will say instead of listening to these so
called clever experts they base themselves instead on their own individual
experiences (and their gut instincts). However, the problem with that is that
each of our own individual experiences are very limited. We have too narrow a
picture. We cannot see what is happening beyond our own individual little
hills. And this is partly why our gut instincts in complex matters like this
are an extremely poor guide.
The data that the economists base build their
predictions on is data from real life, real life people and their economic
experience. We might not like the idea but our own individual financial
circumstances is part of the data they are looking at. They get a much broader picture
than anyone can just based on their own direct experience.
When virtually all serious economists are giving
similar predictions about the economic damage Brexit will do it would be rather
foolish to ignore them. Imagine you were planning a summer party for
tomorrow. You need to try to predict what the weather will be like so that you
can decide whether to have it in the garden or the house. To make that judgment
do you just rely on your gut instinct about what the weather will do? What
happened when you arranged the same party this time last year? Do you perhaps
just look up at the sky the day before and say yes blue sky the weather looks
fine now so should be OK tomorrow ? Perhaps you just listen to what tour mates
“reckon” the weather will be like tomorrow? May be you follow the old adage
“red sky at night Shepherd’s delight, red sky in the morning Shepherd’s
warning”? What then do you do if it’s red sky night and morning? Or do
you do what most people would and consult experts by getting weather forecasts
prepared by professional meteorologists. Predicting the weather is very
difficult, because there are so many variables, but what we can say is that we
are far more likely to get it right if we follow expert evidence than just go
on gut instincts, our own limited experience or popular opinion.
Perception versus reality
If
the opinion polls are to be believed the country in a few days is going to vote
to leave the EU and it seems to me that most of those voting leave would do so based on popular
myths rather than facts. South Wales is a case in point. That region is
expected to vote overwhelmingly to leave the UK. The reason people give?
Because immigrants are taking too many of their jobs, undercutting their wages, overstretching our public services and taking all the benefits. Yet the reality
is there is actually only quite low level EU immigration into South Wales. (Cardiff and Newport's immigrant population is about the national average but the rest is well below.) And South Wales is a net recipient of EU funds! Their problems are far more
longstanding than EU immigration. Their real problems are that they have never
recovered from a 1980s post-industrial decline that has left them behind. Their
sense of being given a raw deal is exacerbated by post-recession austerity cuts
to services and welfare and not EU immigration which has hardly touched them. The stagnation of ordinary people's wages there is a virtually global experience of recent years caused by technology and other factors that have nothing to do with immigration. But none of these facts have dispelled the widespread myth they share with much
of the country that EU immigration and loss of control to the EU is the cause
of most of our ills.
The bible advises us that when we make
major decisions we should not just rely on our own instincts or the loudest
voices but should seek advice from wise advisers.
“The
way of a fool is right in his own eyes, but a wise man listens to advice.”
Proverbs 12: 15
“For
lack of guidance nation fails, but a victory is won through many advisers.”
Proverbs 11: 14
When
I say advisors I do not mean listen to the politicians on either side. They are
advocates for their causes not advisers. I mean taking advice from the leading
experts in their field on their areas of expertise. It is they that we
should be listening to. When 90% of leading economists tell us that
leaving the EU is likely to be significantly damaging to our economy or 83% of
research scientists warn us that it would be equally damaging to scientific
research we should be listening.
Of
course we may decide that the predicted damage that leaving the EU risks may be
worth it for what we gain; greater control over our immigration and our laws.
But again we need to examine the actual facts behind the myths. If we do we
should find that the problems resulting from EU immigration or EU laws are
rather less than is often thought and the benefits rather greater.
We
need to deal with the Europe and the world as it actually is not as we would
want it to be. In a fallen broken world we need to accept the EU is not and
never will be perfect. However we need to recognise the reality that in an increasingly smaller world on our own
we are only a fairly small nation that simply cannot have the power and
influence we once had in the days of our empire. Working together with our European neighbours we will trade more
successfully in a joint single market 8 times the size of our own and speaking
with the voice of 500 rather than 65 million we have a much better chance of
influencing the rest of the world and of meeting the major challenges of the
future, such as terrorism, climate change and the rise of the robots. Together we are stronger and richer. Apart we are weaker and poorer
I
believe the biblical priorities that
should dictate how we vote in the referendum are peace, justice and prosperity for all. I consider that when we
fairly examine the actual evidence and listen to the real experts in all those
areas we should find we are likely to risk losing much more than we gain if we
leave the European Union.
