Recently I went to an IEA talk on the latest Human Freedom Index. Its co-author, Tanja Porčnik, said she could not see by the HFI’s measures how the freedoms of citizens in the European Union member states had been enhanced by the EU. While there is slightly enhanced freedom within EU countries because of free trade, Tanja said, this has to be weighed up with all of the regulation associated with EU membership and that, overall, the EU has actually hampered economic freedom without markedly improving civil liberties.
Indeed, the cost of EU regulation, the Euro and EU trade policies to the UK must be understood. Improving the livelihoods of less well-off European citizens is achieved through aiding trade and migration and not by unifying every conceivable element of every member state. An amalgamation with countries of substantially more interventionist answers to problems is incongruous. Bearing this in mind, some of us regard with surprise certain Remain campaigners who seem only to be against socialism when it suits them.
One political phenomenon that is evermore perplexing is just how it came to be that the ‘freedom’-craving Scottish Nationalists are campaigning to remain in the EU. Expecting true independence after entering the EU with less authority than we currently have was a great misconception of Scotland’s independence referendum. Now some Scottish Nationalists have the audacity to tell us that it is hypocritical to make the same arguments for leaving the EU that we made for staying in the UK – hypocrisy could not be more true of their own position, and Brexit and being British are also not the same principle.
Argumentum ad temperantiam is a fallacy: those who use it contest that extremities are by definition bad and the most moderate position good. This is reminiscent of a large sect within the pro-both-Unions camp who are under the impression that it is utterly uncivilised to campaign to leave either union and that by not upsetting the apple cart, the sanest position is to continue as normal and not be tempted by what they see as radicalism in either case. These are namely the Scottish Labourites who conflate ‘working together’ with working for ‘ever-closer union’. Most of us who want out of the EU see Brexit as a step back from the radically-subsuming beast of all bureaucracies.
As such, a perfect document for dispelling any pretense that remains to plague the clarity with which we view Brexit is Patrick Minford’s Should Britain Leave the EU? We ought to relay the differences between Scotland’s place in the UK and the UK’s place in the EU till the cows come home. Instead we will take a brief glance at Brexit from the reasoned perspective of an economist well-acquainted with the EU’s political economy. Then we can see that the wrath of the EU is nothing like a unionist Scotland.
Minford finds that, after years of the OECD surveying the extent of barriers to hiring and firing workers in the EU, consistently the UK has been substantially less protectionist than other member states. We are still intervene more than, say, the US, as we react to the pressures of the Social Chapter which favours strong powers for unions and invasive labour market regulations. Businesses across the EU are being choked by the workers’ rights being thrown at them from every direction, which ultimately backfires for those the regulations were intended to help.
Using the Liverpool Model of the UK, first created by Minford for Margaret Thatcher, with its simulations of what the UK might look like if we moved towards the environment prevailing in some other parts of the EU, we see high potential costs to the UK economy from even wider-spread extension of EU regulation. After a ten-year 5% rise in the measure of intervention on growth, we would see a fall in growth of over 1.5% a year over two decades. In the case of the Euro, if the UK were to join our ‘boom and bust’ factor, or the instability in our economy, is predicted to increase by 75%.
As is the case with the Social Chapter, opting out of the Euro does not stop us feeling its effects. The euro-zone is stagnating as unemployment remains at record levels, youth unemployment at extraordinary levels and wages and prices threaten deflation. The UK is faced with the constant possibility that we will be involved in the bailing out of financially-troubled EU states. The Maastricht Treaty may rule out bailouts on our part, but EU institutions have been deliberately used to advance the cause of political union – which means a stronger drive for harmonization and cross-country support. Being in the economic union but not adopting the common currency is something described as being caught in a double spider’s web when you are lightly entangled in a single one from which you can still disentangle yourself.
In Minford’s words: being a member of the EU is like being shackled to a madman. The inception of the Euro and the continuing economic mishaps by Eurocrats in the name of politics has been catastrophic for countries involved. The ideal outcome for the UK is a major withdrawal from most of what the EU currently prescribes. Meanwhile a collaboration on areas of common interest like migration, free movement of capital and trade agreements should be continued. Reform from within is an unrealistic idea when treaty rewriting requires unanimous agreement from all member states.
Nicola Sturgeon says that in the event of Brexit a second independence referendum will be triggered and support for Scottish independence will increase unprecedentedly. A more likely outcome is that Scottish people see the turmoil ensuing in the EU once the UK has left and the UK will seem the far wiser option of the two – meaning a second Scottish independence referendum could not succeed.
So this is purely a case for Brexit, and not one against Scottish independence. We can relax in that regard while the referendum is won and at least there is the potential for an EU-free, free-market Scotland to flourish one day. In any case, the SNP’s track record and waving-off-Westminster agenda does seem a whole lot less daunting in the face of the euro-bureau-super-duper state.