Why the EU referendum is not so important after all

The general consensus among believers in free markets is that the UK should vote to leave the EU in the June referendum. And as a general principle, the chance to leave a supra-national organisation which threatens to evolve into a super-state should be grabbed. It is unlikely to come around again for a long time. The original idea on which the EU was based, the European Coal and Steel Community, was in essence a common market, but it was set up to promote a European alliance as a means to prevent war from ever returning to the continent. Today, the EU has morphed into a behemoth, a vanity project for changing European leaders obsessed with ever closer integration. And there is plenty to dislike. EU politicians and bureaucrats are arrogant, expensive and constantly on the lookout for new areas over which to wield their power. Because of French vanity the European Parliament decamps from Brussels to Strasbourg once a month, at a cost of £130 million a year. The EU’s preposterous common agriculture policy consumes around 40% of the over €150bn budget, and the rest is spent no less wisely. And so on. Membership is certainly costly to the UK, the net-contribution to the EU in 2015 is estimated at £8.5bn. So there are good reasons to leave. The arguments for staying in are primarily about the risk of leaving, something no principled person should be guided by.

And leaving the EU will indeed materially change the way the UK is governed and how decisions are made on a number of important matters. What this is not, however, is a referendum on the general direction of travel which has been set for our country. No major policy is likely to change in any significant way whether the result of the referendum goes one way or the other. The main reason is simply that most of the big decisions about where the country is going are still being made by our own parliament. The UK spends £8.5bn on the EU, but has total public spending of around £750bn. And while the centre of power for a number of matters will shift from the EU to the UK, the decision makers in Westminster are not very different from those in Brussels. Both places are populated with proponents of the same big government, people who see a place for influence for the state (national or super) in every aspect of its’ citizens’ life.

What’s more, many of the unpopular decisions which are believed by the general public to have been made by the EU are really policies which Westminster have conveniently used the EU a vehicle to promote, and which in the absence of EU membership would have been implemented anyway. Metrication provides a good illustration. And does anyone really think that, for example, in the absence of EU labour law Westminster would have left labour markets unregulated? The EU is also less powerful than many think when it comes to enforcement of its laws and regulations, and if individual governments want to they can often dispense with following them with little or no consequence. Almost every country in the Eurozone has at some time been in violation of the Stability and Growth Pact’s budget deficit rules, but no-one has ever been fined. Spain is turning a blind eye to the Common Fisheries Policy, to protect its fishing fleet, the biggest in Europe. The European Arrest Warrant has been implemented only partially or with significant restrictions by a number of countries. And so on.

It is therefore quite clear that the UK today looks very much like it would if we had never joined in the first place. This is not a vote on the direction of travel for the UK. On the ballot is not the welfare state or the interventionist foreign policy, nor are we by leaving the EU going to make changes to our monetary system of central bank mandated fiat money or any other major characteristic of the current system. When this referendum is being touted as the most important decision of our generation it is in many ways a sorry admission that when people go to the polls in the general election they are not being asked to make a decision with any material consequence; either party will rule in more or less the same way. Politicians are of course extremely powerful, but in fact they are just vying to be elected as caretakers of a journey for which the general direction has already been laid. Leaving the EU will not change any of that.

Posted 21 March, 2016

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