Institute for the Study of Civil Society The Eurosceptic’s 55 Tufton Street, London, SW1P 3QL Tel: 020 7799 6677 Email: [email protected] Web: www.civitas.org.uk Handbook 50 live issues in the Brexit debate he Brexit debate that has taken hold of the country is one of the Michael Burrage The Eurosceptic’s Handbook defining issues of our time. The outcome of the EU referendum in T June will have ramifications that will be felt for generations to come. But the discussion is curiously one-sided. The polls show that the British people are fairly evenly split between those who would stay and those who would leave – and very few would give the present arrangement a ringing endorsement. Yet all the resources of government and big business have been thrown behind an information campaign designed to ensure the UK remains a member of the EU at all costs. The Eurosceptic’s Handbook tries to help rebalance the debate, and arm those with doubts about the EU with the counter-arguments they need to make an objective judgement. Michael Burrage, whose previous Civitas publications have earned praise for overturning the received wisdom about the EU’s supposed trade benefits, here takes a broader look at the pros and cons of EU membership. Standing back from the spin and hyperbole of Project Fear, Burrage surveys the evidence from Britain’s involvement with Brussels since it joined the European Economic Community in 1973. He exposes the flaws in the arguments that have been made along the way for Britain’s continued membership. He lays bare the costs – financial and democratic – to every UK citizen of sticking with the European project. And he explains why, if Britain votes to leave, it will have nothing to fear – and much to gain. Michael Burrage £10.00 ISBN 978-1-906837-81-5 Cover design: lukejefford.com Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page i The Eurosceptic’s Handbook Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page ii First Published May 2016 © Civitas 2016 55 Tufton Street London SW1P 3QL email: [email protected] All rights reserved ISBN 978-1-906837-81-5 Independence: Civitas: Institute for the Study of Civil Society is a registered educational charity (No. 1085494) and a company limited by guarantee (No. 04023541). Civitas is financed from a variety of private sources to avoid over-reliance on any single or small group of donors. All publications are independently refereed. All the Institute’s publications seek to further its objective of promoting the advancement of learning. The views expressed are those of the authors, not of the Institute, as is responsibility for data and content. Designed and typeset by lukejefford.com Printed in Great Britain by 4edge Limited, Essex Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page iii The Eurosceptic’s Handbook 50 live issues in the Brexit debate Michael Burrage CIVITAS Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page iv Contents Author vii Summary ix Introduction 1 Part One: History 1 1971: Her Majesty’s Government explains why the UK should join the EEC 6 2. Labour’s re-negotiation in 1975: Real or bogus? 14 3. The 1992 Maastricht Treaty: Misjudgement or misrepresentation? 19 Part Two: A peculiar form of government 4. Flying in the face of the global principle of political legitimacy 28 5. A synthetic civil society 31 6. Intensive self-promotion 37 7. The chancelleries of Europe devise a government 48 8. How much legislation comes from Europe? 55 9. European government in action: five examples 59 10. Do the British have much influence? 69 Part Three: Finance 11. The European Commission power elite: pay and pensions 80 12. Cost of MEPs and MPs in 2011 83 13. Givers and takers: the EC’s redistribution of nine members’ contributions 85 14. EU Budget: the HM Treasury report 90 iv Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page v 15. Mrs Thatcher’s rebate, and the cost of Mr Blair’s concession 92 16. Domestic equivalents of the direct and indirect costs 96 Part Four: The Common and Single Market 17. An overview of UK export growth since 1960 106 18. The success of the Common Market 1973-1992 110 19. The failure of the Single Market 1993-2012 115 20. What would have happened to UK exports if there had been no Single Market? 122 21. Have UK goods exporters been losing their touch? 127 22. A club of high unemployment… 130 23. …which is also distinctively severe 134 24. The slow growth of GDP and productivity in the Single Market 1993-2013 138 25. A burst of candour from European Commission staff about the failings of the Single Market 142 26. Who will measure the performance of the Single Market, how, when and for whom? 146 27. Paradox in goods exports: non-members have been its major beneficiaries 150 28. Paradox in services: non-members have been its major beneficiaries 155 29. Why hasn’t ‘sitting round the table and helping to make the rules’ helped UK exports? 159 30. Does a Single Market in services exist? 165 31. Services exports to the EU and other markets 171 v Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page vi THE EURoSCEPTIC’S HANDBooK Part Five: Trade agreements 32. The Commission as trade negotiator (I): A preference for small partner countries 174 33. The Commission as trade negotiator (II): The neglect of services 180 34. The Commission as trade negotiator (III): The sidelining of the Commonwealth 184 35. Have European Commission trade agreements in goods helped UK exports? A scorecard versus Chile, Korea, Singapore and Switzerland 188 36. The UK’s lost years of freer trade 197 37. obstacles impeding EU service agreements 202 Part Six: Current debate 38. What does Her Majesty’s Government actually know about the impact of the EU on the UK economy? 212 39. Does the Bank of England know much more? 223 40. Has the EU’s Single Market been a magnet for foreign investors? 232 41. Why multinationals’ opinions on the EU are less than convincing 239 42. Immigration, free movement and welfare 242 43. An academic illusion: research depends on an EU ‘pot of money’ 248 44. Scaremongering to keep the UK in 259 45. We have been here before! 266 46. A Financial Times editor apologises for urging entry into the euro 269 47. How difficult would it be for post-Brexit UK to replace existing EU trade agreements? 273 48. Why the UK would negotiate better services FTAs by itself 283 Part Seven: The future 49. Uncertainties of staying 296 50. Uncertainties of leaving 305 vi Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page vii Author Michael Burrage is a director of Cimigo, which is based in Ho Chi Minh City, Vietnam, and conducts market and corporate strategy research in China, India and 12 countries in the Asia Pacific region. He is also a founder director of a start-up specialist telecom company which provides the free telephone interpreter service for aid workers and others where interpreters are scarce. He is a sociologist by training, was a Fulbright scholar at the University of Pennsylvania, has been a lecturer at the London School of Economics and at the Institute of United States Studies, specialising in the comparative analysis of industrial enterprise and professional institutions. He has been a research fellow at Harvard, at the Swedish Collegium of Advanced Study, Uppsala, at the Free University of Berlin, and at the Center for Higher Education Studies and the Institute of Government of the University of California, Berkeley. He has also been British Council lecturer at the University of Pernambuco, Recife, Brazil, and on several occasions a visiting professor in Japan, at the universities of Kyoto, Hokkaido and Kansai and at Hosei University in Tokyo. He has written articles in American, European and Japanese sociological journals, conducted a comparative study of telephone usage in Tokyo, Manhattan, Paris and London for NTT, and a study of British entrepreneurs for Ernst & Young. His publications include Revolution and the Making of the Contemporary Legal Profession: England, France and the United States (oUP, 2006) and Class Formation, Civil Society and the State: A comparative analysis of Russia, France, the United States and England (Palgrave Macmillan, 2008). He edited Martin Trow: Twentieth-century higher education: from elite to mass to universal (Johns Hopkins, 2010). vii Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page viii THE EURoSCEPTIC’S HANDBooK His previous Civitas publications include Where’s the Insider Advantage? A review of the evidence that withdrawal from the EU would not harm the UK’s exports or foreign investment in the UK (July 2014) and ‘A club of high and severe unemployment: the Single Market over the 21 years 1993-2013’ (July 2015) in the Europe Debate series. viii Eurosceptics Layout.qxp_Layout 1 16/05/2016 09:56 Page ix Summary • The EU has a peculiar form of government that ignores the fundamental conditions for the success of democracies: its rulers are not co-cultural with its voters and there is no autonomous civil society. • The EU is aware of its lack of democratic legitimacy and spends huge amounts of taxpayers’ funds on self-promotion. • As the EU has grown in size, Britain’s representation has inevitably declined. • The EU is a mechanism for the redistribution of wealth across its member countries. The Commission takes from nine wealthier, more developed members, and after taking roughly six per cent of all receipts for its own expenses, returns some of their contributions back to the nine, and re-distributes the rest to other, generally poorer, member countries.