I have been recently entertained by all the fervent discussion on the merits of rejoining the Single Market as an EEA member resulting from Tobias’s advocacy in that direction. Not because it couldn’t be done. Not because it doesn’t have some merit. No, I am entertained because that fervent discussion presumes that it is all so obvious as a solution to the UK’s woes, and implementing it all so smooth we’ll barely even notice the transition. I’m not so sure.
I want to give you a flavour of how the campaign against any such move will play out on the air waves:
Q – “You want us to rejoin the Single Market to ease trade disruption, right?”
A – “Yes”
Q – “Without the rebate?
A – “Yes, that’s gone sadly.”
But the rebate is only applicable as a paid up member of the EU?
The rebate remains very relevant, as it would appear that the cost of EEA membership would only be somewhere between 25-12% cheaper that what the UK was paying to be in the EU:
“Let me try and understand your position here, you want to lose control of vast swathes of UK policy making here in order that we get a 12% discount on our previous fees. Is that right?”
Q – “Without the financial service regulator?
A – “Yes, that too”
Q – “And the medicines regulator?”
A – “Yes, i’m afraid so?”
Areas in which the UK is very dominant – massively so in the case of financial services – and areas which the EU has not demonstrated a great deal of friendliness in the past. The UK’s ‘free-wheeling anglo-saxon capitalism’ is not greeted with much enthusiasm in france, and i doubt EU regulation would do anything but knacker its competitiveness.
Q – “So minus a say in regulation of the key growth industries of Fin-Serv and Medicines, you also want to leave us subject to Precautionary Principle regulation in Data, AI, Biotech, GMO, Energy too?
A – “Errr. yes, i guess so.
Surely the Precautionary Principle is a good thing; there to prevent the disastrous consequences of unfettered scientific & financial activity?
Don’t get me wrong, there is a place in this world for the Precautionary Principle as a regulatory model; it is useful in policy areas subject to catastrophic consequences whose horizon lies far beyond the understanding of a single four/five year parliament. Climate change being a great example. But its use is abused in low-trust polity’s such as the EU, as making people ‘safer’ is all they can do within the limitations of their crippled political legitimacy:
So we get poor regulation like GDPR, and a lack of european FANG’s.
So we get poor regulation like the EU AI Act, and a lack of european Deep Minds.
So we get poor regulation that prohibits GMO adoption, while the developing world struggles with food security.
So we get poor regulation that prohibits Biotech/Medicines adoption, linked to the three above.
So we get poor regulation that limits nuclear and fracking, while furiously digging up brown coal (because Climate!).
So we get extremely poor financial regulation regimes like MIFID2 that hamper proper functioning markets.
I take the view that Demonstrable Harm should be the default regulatory model for most economic/social activity, and that this is the model most compatible with high growth nascent tech industries. The EU is choking its own future here.
Q – “Cherry on top question here, will we need to join a Customs Union to ‘solve’ the Northern Ireland problem?”
A – “Yes, sounds sensible”
But Northern Ireland are loving the current best of both worlds situation – only the minority unionist politicians are are kicking up a fuss, which seems to be losing them votes & core support?
No. Northern Ireland cannot form a government right now, and the NIP is damaging the Belfast agreement – because the EU forgets that consent of [both] communities matters, and that east/west links matter every smidge as much as north/south.
Q – “And will the EU as a whole have an interest in building foreign trade integration in a way that is advantageous to the UK?”
A – “Well, i’m sure there will be an element of consultation!”
But surely being inside the Single Market will be an enormous advantage, and Truss’s trade deals are only copy-n-paste exercises of existing EU to third-country deals?
And yet it will end our ability to conduct trade agreements with the RoW – which is fast going from 75% of world trade to 90% of world trade. Yes, yes. Gravity, etc. And yet the EU diminishes in importance and will build its external trade relations with in the interests of its [members], not the UK. As it should.
And i’d like to point out that jettisoning the copy-n-paste rollover deals might be easy, but once we join the trans-pacific trade deal the whole thing becomes a lot more complicated to coordinate with wholesale adoption of the regulatory model that defines the Single Market. That evidence based sanitary/phyto-sanitary model is not very compatible with the EU’s risk based SPS regime. Demonstrable Harm vs Precautionary Principle. There could still be a vetinary agreement, but it will be limited.
God Willing this inept Tory gov’t sets that capstone in place before it collapses!
Q – “Aside, from the economic aspect, will we have to re-bind ourselves to the Flanking Policies of social, employment, and environmental regulations?”
A – “Now you mention it, that does sound rather likely”
You mean those pesky regulations protecting us from worker exploitation, air pollution and ecosystem collapse?
Yes. And yet they will have little legitimacy in the UK as they derive from a process that has no democratic accountability or representation.
Q – Now, here’s a tricky one for you; how do you feel about unrestricted Freedom of Movement with all that entails as a Simgle Market member?
A – Hmmm, yes. I imagine that might require a little finessing in the presentation!
On immigration, it is important to note here that the salience of immigration as an electoral issue declined massively once the public felt that there was control on the vast majority. Freedom of movement would only reverse this (happy) trend. And it won’t be long before someone points out that previous gov’t managed the freedom of movement electoral issue by more tightly restricting access to the UK from the RoW:
“Are you content that we should return to the previous immigration system where we discriminated against 90% of the worlds populations (including some of our closest kith and Kin!), in order to privilege 6% with unrestricted access just because they happen to live closer to us?”
And then they can merrily march the argument on to rejoining the EU shortly thereafter, because “You voted ‘Remain’, that’s what you really want if we’re honest, isn’t it?”:
But Norway feels no need to go one step further and join the EU in full, surely this is a specious argument?
And yet that is how the debate will conducted – on the basis that this is what advocates of the single market [really] want:
“It’s all very well for a little nation like Norway to be a rule-taker, it hardly has a choice in the matter, but for the UK…!”
Q – “Will we get to stay outside Schengen?”
A – “Oh no, the French will be terribly keen to get us onside!”
Q – “What about the Freedom, Security and Justice opt-out we secured?”
A – “Ooh, no that’s gone.”
Q – “And that charter of fundamental rights?
A – “Oh, we all knew Blair was having fun when he equated its importance with the beano, but no, even that is gone.”
Q – “Now, here is a tricky one; you know there has always been a bit of domestic fluster whenever anyone floats the idea of a ‘euro’ army…?
A – “Ah, sorry old bean, that ship’s sailed: a CDSP will be harmonising national foreign policy in future”
Q – “May I also ask about these very worrying rumours on tax harmonisation? Ireland is getting a little jumpy about Capital Gains tax, and I imagine we would too…”
A – “Fraid so, that’s the way the wind is blowing these days!”
And you know it will bleed out into every and any awkward element of public debate:
“So, let’s talk about tampons. You have no objection to making them VAT payable I take it? An additional 20% cost jacked onto an essential good during a cost of living crisis…”
Q – “Well, so far so promising. Last question; how would you feel about us steering a little to the windward side of eurozone membership?”
A – “Ah, well. Yes, that’s a tricky one, but we’ll have a word with the French certainly. Sound them out, so to speak…”
On the subject of import checks; we are not yet checking all incoming goods in the same way that the EU is inspecting all our outgoing exports. I can see that we should be in principle, and yet I also accept the main benefit of international trade is ensuring that the domestic market receives the imports it requires (85% of domestic market activity) rather than that exporters get the competitive advantage they need in foreign parts (15% of domestic market activity).
Isn’t the real consequence of brexit the destruction of people rights and ability of the state to be able to support them, rather than freeing British citizens from the tyranny of the EU?
I can well imagine that someone with a natural bent towards a more collective social democracy, more interested in positive liberty, would be quite comfortable as a member of the EU/Single Market.
I merely ask you to understand that this is all possible outside of the EU/Single Market if only domestic electorate can be swayed to vote for it…
… but those of a different persuasion – more individualist and market economy oriented, more keen on negative liberty – found the pre-2016 arrangements increasingly intolerable.
They will not find this an easy sell!
Excellent overview of the “collateral damage” of rejoining the Single Market. Not something that Ellwood nor the MSM touched on.
Much obliged, thank you. Jbt
Personally I see democracy as the biggest loser in the plan to enter the single market.
Though we all know it’s only stage 1 of the plan to full membership of what is for us a very expensive club.
The previous plans of moving all our nuclear material to France, giving up our security council seat and moving The City to mainland Europe. Were a level of asset stripping I couldn’t believe anyone would have the nerve to suggest. I was dumbfounded to see it being agreed with.
I’d tend to agree, if only because governance struggle to achieve popular legitimacy if it is neither representative nor accountable.