The UK cannot have its cake and eat it

Other European countries not in the EU have none of the privileges the Leave campaign says it can secure

 

If the UK votes to leave the EU, it will be the first member state to have done so in the history of the union. This is why it is difficult to predict the implications for trade, economy and the future tone of relations with the EU.

Because there is no precedent, Eurosceptic ministers have often cited Norway as being a model of Britain’s possible post-Brexit future, with all the benefits of a close relationship with the EU but none of the bureaucracy or ‘red tape’ forced on members.

If the UK withdraws, it will be just the start of negotiations, as member states would have to decide whether the UK can remain part of the European Economic Area (EEA). Norway, along with Iceland and Liechtenstein, is part of the EEA without being part of the EU. This means:

  • It still has to comply with European rules on free movement. The EU has repeatedly made clear that full integration into these laws are the price Norway must pay for access to the single market. Norway has a much higher level of immigration proportional to its population than the UK (it is also a member of the Schengen area).
  • Continued access to the single market (which many advocating Leave insist Britain would still have) means that Norway still has to comply with EU’s product standards, financial regulations, employment regulations, and substantial contributions to the EU budget. The difference is, it plays no part in writing those regulations.
  • It still has to pay. Norway pays around €656m to the EU; OpenEurope has calculated that Norwegians pay about €32 less per capita to the EU than Brits.

If the UK stays in the EEA, there is no reason to think that the UK would get a better deal than Norway has currently. On the other hand, if it leaves the EEA, the UK would have to negotiate multiple trade arrangements in a process that would be hugely costly and risky.

Switzerland is not a part of the EEA but negotiates instead through the European Free Trade Area (EFTA) which means it has more than 120 bilateral agreements. It is also still bound by many EU rules and regulations, although its refusal to integrate some of these has in recent months led to a ‘formal cooling’ of relations with the EU –  ‘bilateral relations have been severely strained since the February 2014 anti-immigration initiative, the outcome of which called into question the principles of free movement and the single market that underpin those relations.’

The UK cannot, whatever the Leave campaign would have us believe, have its cake and eat it. As the Norwegian and Swiss examples show, no other country can either.

There is no reason to believe that the UK, if it rejects deals already offering special treatment, would be entitled to further privileges; in fact, it’s likely to be quite the opposite.

Ruby Stockham is a staff writer at Left Foot Forward

10 Responses to “The UK cannot have its cake and eat it”

  1. Steve

    Interesting piece – you might also enjoy this on why Brexit would weaken the UK’s relations with America and Commonwealth countries http://youth4inuk.blogspot.co.uk/2016/02/britain-doesnt-have-to-choose-between.html

  2. Jimmy Glesga

    We do not require special treatment we should just leave and trade as normal.

  3. Adam

    have found Norway’s a very good campaign line. People’s idea of leaving the EU is often shaped by fanciful rhetoric. When the truth is we either lose access to the EEC (which makes up the majority of our exports), or have to pay in, abide by their rules, and allow free movement without a vote, leaving sounds a little pointless.

  4. Lamia

    It still has to comply with European rules on free movement. The EU has repeatedly made clear that full integration into these laws are the price Norway must pay for access to the single market. Norway has a much higher level of immigration proportional to its population than the UK (it is also a member of the Schengen area).

    You are mistaken, and the reason for this is in the final part of your claim. Norway chose to be part of the Schengen area. The Schengen area specifically enables no borders among member states. That’s the point of it. The UK is not and would not be a member of the Schengen area.

    The UK will get the best deal it can, and so will the countries negotiating with it. That’s how business works. The UK is the fifth largest economy in the world, and has plenty of other things going for it. It may not be plain sailing, but in the long run we will manage.

    A club that tries to threaten its members into staying is not worth being part of.

  5. Chester Draws

    To show that it is worth being in the EU you need to show the benefits. The UK won’t get a better deal than Norway or Switzerland, that is true. Yet those two seem to being quite well — better than most of the EU — and are in no hurry to join. If being in is so good, why don’t they join?

    In Switzerland’s case the answer is simple: the Swiss value their sovereignty above all else. They are prepared to pay a little bit for that privilege. And the “Leave” campaign argues the same thing — sovereignty is worth more than a few trade advantages.

  6. Tony Hart

    Norway has a large trade surplus with the EU (because of oil). Therefore, it must pay into the EU to secure this trade surplus. UK has a huge trade deficit and probably, a large current account deficit with EU (when one includes services). Thus, EU would be worse off without us. That means that we might well get trading links without any restrictions.

  7. ted francis

    That Norway and Switzerland “seem to being quite well” has nothing to do with being in or out of the EU. It is because they enjoy a greater degree of democracy than we do (or ever will the way the wind blows currently), they are much more at ease with their social structure, their society is ordered in such a way that it is fairer, more equable and not riddled throughout with “ceilings” held in place by a hierarchical system that has prevailed for several hundred generations. Add to that the yawning differences in population size and demographics between us and the imbalance in income differentials and wealth possession and it easy to see how very different we are and any comparison would be odious. We British have always been a trading nation greatly enhanced by having a hugely populous empire which we managed to exploit through the imposition Imperial Tariffs. We no longer have those advantages – they slowly evaporated so that by the time we “joined Europe” they were gone. Now our major trading commodities are services, banking exchange and flogging arms to despotic nations. Our economy is buoyed up by foreign companies establishing manufacturing bases here because we are the key that opens the door to a market of 500,000,000 people. Do you think they’d stay if that door was slammed shut? They’ve already said what they do. So, should we leave Europe? Only a delusional Little Englander would think we could prosper alone. Finally, take a long look at the individuals leading the Brexits. What do you find? Men and women who have all their lives been driven by naked, highly personal ambition.
    Sorry its been long -winded – albeit sincere and deeply felt on behalf of my fellow country men and women.

  8. Mark Law

    Why the Left should be anti-EU.

    The EU is a neoliberal & unreformable institution

    There is a debate in the progressive left as to what stance to take on the June referendum on the UK’s membership of the European Union. Here are some of the arguments put forward by those arguing the left should vote to stay in the EU.

    Argument 1: Stay in and fight for change.

    The palaver which accompanied David Cameron’s negotiations of the piffle that is his “deal” with the EU should remind us of a stubborn fact. Even this agreement, which is not legally binding, required the assent of all other 27 EU member states. That is true for any change within the EU. So the only way to get another EU would be to get the agreement of every one of the 28 member states.

    For any socialist change, that would require the radical left being in office simultaneously from Dublin to Tallinn. It’s a tall order, if not an impossibility.

    What about the European Parliament? It has no power to affect fundamental or even minimum changes in the make up and functioning of the EU. When it comes to the Trans-atlantic Trade and Investment Partnership, it will not be allowed to amend the deal currently being negotiated in secret between the unelected European Commission and the US. It will be allowed one vote on accepting or rejecting the treaty. But before that the European Commission will sort out the voting with the heads of the two dominant groups in the parliament – the centre-right European People’s Party (Christian Democrats) and the centre-left Socialists and Democrats.

    The European Parliament has very limited powers, virtually zero, regarding the current migrant crisis. It is also very good at co-opting MEPs who might be troublesome through the largesse on offer. It’s very rare indeed to hear about anyone of them upsetting the apple cart.

    The simple fact is that internal change is an impossibility within the EU. The task of creating genuine unity in Europe based on solidarity and respect is one which requires starting all over again. Britain and other member states quitting can help develop the debate about what sort of Europe we need, one which is democratic unlike the current EU where democracy is virtually absent.

    Argument 2: How can you take the same side as Michael Gove, Boris Johnson and Iain Duncan Smith?

    The answer might be how can you take the same side as and Theresa May, Jeremy Hunt and Philip Hammond, let alone David Cameron and George Osborne?

    Currently the debate is between two sides who broadly share the same neo-liberal outlook. There is one important factor, however; the bulk of corporate Britain backs staying in the EU. In the coming weeks and months they will unleash a barrage of “shock and awe,” as in the 2014 Scottish referendum, aimed at intimidating people into voting Yes otherwise they’ll lose their job, pension or home!

    Furthermore who else wants a Yes vote? Angela Merkel and Francois Hollande, Barack Obama and John Kerry…

    If Cameron was to lose the referendum he would have to resign, igniting a battle in a divided Tory Party. It would also lead to a major crisis to UK PLC. Two good outcomes.

    Argument 3: The Cameron government is so right-wing we need to stay in the EU because it restrains the Tories.

    There is no doubting how nasty Cameron and Osborne are but in today’s Europe they are not the most right wing government in Europe? Check out Hungary, Finland or Poland. Britain is not the driving force of neo-liberalism in Europe as it was under Thatcher. It is the EU which is the driving force. Look at what its inflicted on the people of Greece, Spain, Cyprus, Portugal and Ireland. Check out the way it’s used the economic crisis after 2008 to force through a raft of policies, including giving the European Commission (unelected) the power to veto member government’s budgets and spending plans.

    So take for instance the Cameron government’s war on benefits. This is drawing on the experience of Germany a decade ago when a Social Democrat and Green coalition government headed up by Gerhard Schröder implemented a series of measures in advance of the requirements of the EU’s Lisbon Treaty. Above all they cut benefits, understanding that if you remove the safety net below working people, they will cling onto their job come what may rather than rely on state benefits.

    The subsequent German export boom resulted from a dramatic fall in labour costs as wage levels fell across Germany.

    The EU is not a barrier to free market “reforms,” it’s not only taking the lead in pushing them through but it is encouraging member states in a disasterous “race to the bottom,” where they each compete as to who has the lowest wages, the poorest health and safety conditions and the lowest rate of tax for businesses.

    Further, the people of Greece are living through a calvary imposed by the unelected Troika of the European Commission, the European Central Bank and the International Monetary Fund. That saga reveals volumes about how undemocratic and free market is the EU.

    Argument 4: Vote Yes to oppose racism and to keep our borders open.

    UKIP is very nasty but it’s a fringe player. The European Union itself is the driving force once more with its Fortress Europe policy towards migrants fleeing wars and economic chaos that it has in large part helped create.

    People are drowning trying to cross the Mediterranean as a consequence, fences are being erected across borders and Syrian and Iraqi refugees being deported back to a war zone!

    The EU has also been a key force in driving forward Islamophobia with bans on headscarfs spreading.

    Again, the Cameron government is nasty, not least in the tiny numbers of Syrian refugees it has given asylum too, but it is not the driving force behind the wave of racism growing across Europe, fuelled by the EU and national governments.

    The EU allows freedom of movement for citizens of the EU but pulls up the drawbridge for those fleeing poverty and war

    Argument 5: We need to stay in to build European unity against austerity and racism.

    In the 2014 Scottish referendum Labour deployed a similar argument – we need to stay in the UK in solidarity with colleagues in Wales and England. The response was that we don’t need the British State to bring us together, that is best down through common resistance.

    European unity against austerity, racism and many other things will be built on the basis of common struggle, not through relying on Donald Tusk or Jean-Claude Juncker.

    Back in 2002 it was the European Social Forum, a grass roots body involving tens of thousands of people making decisions involving direct democracy, which launched the call for the European-wide protests against the impending invasion of Iraq. That went global in the biggest protests in the history of humanity. Whether your country was or wasn’t a member of the EU was of no significance in that decision.

    Argument 6: We should vote Yes in solidarity with the rest of the European Radical Left.

    The majority of the radical left in Europe is pro-EU. In the case of Syrizia in Greece, this was their Achilles heel. Their desperation to stay in the EU and the Euro meant they threw away their referendum win -rejecting austerity – and then had to accept an even worse pack imposed by the Troika.

    While a majority of the radical left in Europe are pro-EU, that’s not the whole story. The Red Green Alliance in Denmark see the EU as “an agent for neo-liberal politics, anti-democratic and militaristic. We oppose the creation of a European Union and favour European and international cooperation based on equal rights for all nations including the right to independence and self-determination.”

    The Socialist Party in Holland shares much of that and the Left Bloc in Portugal is a more critical voice regarding the EU.

    But to return to a previous point: unity is built through action not institutions. The lack of a common Europe wide coalition of resistance to austerity or racism needs to be addressed but it will have to involve forces on both sides of the divide over EU membership.

    Argument 7: The No campaign is so right wing and racist and its arguments will always reflect that.

    That is true for the bulk of the leaderships of both campaigns. Our job is to try and offer a different viewpoint and to shift the ground the debate takes place on.

    Since the 2008 financial crisis and the Eurozone crisis that’s followed the EU has driven forward its neoliberal project. One of the biggest beneficiaries have been those banks that caused the crisis, fed money by the European Central Bank and Bank of England’s Quantative Easing, which helped drive up their share price and their cash reserves.

    For the working people of Europe integration means the imposition of free market economic and social policies, not the coming together of European states. Indeed the contrast between the EU’s prosperous zone grouped round Germany, including Austria and Holland, and Southern and Eastern Europe has grown wider (Britain and France lie in an intermediate zone).
    These are the political arguments. Then there is the economic argument or COST!

    A membership fee of £55 million per day!!
    Or not quite: https://fullfact.org/economy/our-eu-membership-fee-55-million/
    There are a host of reasons as to why we should oppose the EU. Let’s get them out there.

  9. John Woods

    Dear Ruby, the BREXIT Camp are not interested in logic or in economic arguments. They want their country back, grammar schools with proper discipline, none of your Human Rights legislation that prevents an employer from sacking anyone he wants to sack when he wants to sack them, none of your immigration (unless he wants a cheap servant to maintain his garden or paint his house). We have to win this argument to Remain on the basis that there are more people who believe in the future than believe in the past.

  10. Gerry Toner

    In or out is a distraction. It is the government in this ‘country’ that needs to be sorted out. Its been cake for business and crumbs for workers since Thatcher. All the other noise is careerist banter from the star struck.

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