The Lion And The Unicorn

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The only way to wrest power away from our ruling elite is to take it. Voting to leave the European Union begins the process.

David Cameron has given us the means. Simply by putting an “X” on a piece of paper we can assert our sovereignty.

The box that no one is supposed to put an “X” in—the one that David Cameron wishes he had never put on the ballot—is a box that you may never see again outside a museum.

That box is your sole right to take power over your government.

That power normally only exists over the United Kingdom government. It does not exist for the European Union. No matter who you vote for in a general election, the European Union remains.

This one time you can participate in that most British of political processes—a ballot box revolution; an orderly transfer of power which removes the supremacy of the European Commission and the European Court of Justice from our national life.

Long before this campaign started, just after the Conservative Party’s unexpected election win, Alistair Campbell said on Question Time, “even having the debate is dangerous”. He was right. Democratic and accountable government are the best defence we know of against the hubristic and maladroit.

The absence of democracy across a wide range of policy areas is a feature of the European Union and it has an enormously detrimental affect upon the quality of our public life.

British voters cannot elect a government that can make changes at an EU level because the European Union is above the nation. The supranational character of the European Union excludes British voters from the process.

Do you want our parliament to be able to make laws concerning the areas of policy our politicians have given away to the European Union? If you do then you must instruct our politicians to return our governing power to the British parliament.

You can only do that by voting to leave the European Union.

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A Point Of Principle

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It is generally accepted that Britain could succeed outside the EU. Polling data indicates that most people think that over the longer-term Britain would be better off outside the EU. It is only over the short-term that people expect a bit of a wobble. In other words, it is the transition that concerns people.

Indeed, the consensus runs so deep that the Prime Minister, who has since taken to embarrassing himself with silly scare stories which nobody could believe, told the House of Commons earlier this year that: “My argument is not going to be, in any way, that Britain couldn’t succeed outside the European Union. Of couse we could. We’re a great country”.

That magnanimity has been well and truly lost in the heat of referendum battle—I am not sure debate is the right word as no real exchange of ideas is occurring. The Remain side will not recognise that the project which they insist upon promoting in terms of economics is wholly political and that leaving or remaining in the EU is about who governs Britain. Should the United Kingdom be a self-governing democracy or should the United Kingdom be subordinate to a supranational government based in Brussels? That is the question.

The real argument therefore concerns democracy and self-determination, not money nor workers rights. Britain has a proud history of support for working people—rights that were hard-won and are now so ingrained that they are taken for granted. Sure, there are debates around the margins, but it is only in the fervor of a referendum campaign that anybody could argue that entire tranches of policy could be surrendered without any form of defiance. The idea is laughable.

Now, however, the government, in the form of Chancellor George Osborne—supported by former Chancellor Alistair Darling—are resorting to outright threats and intimidation. I do not know anybody committed to leaving the EU who does not acknowledge that there is likely to be some kind of turbulence on the financial markets if the British people hold their nerve and vote for the freedom for which their forebears fought. That has been factored in and is a price that is well worth paying. This goes way beyond that.

George Osborne is now claiming that a vote to leave the EU “would mean less money. Billions less” and that he would raise taxes and cut spending as a result. This is not congruent with the Remain line that leaving the EU would be a “leap in the dark”. When did that change? Or did it? Are voters supposed to think that leaving the EU is economically uncertain or certainly disastrous?

The result is confusion and that I think is the purpose of “Project Fear”. It is not to scare people, as such, it is to bewilder and befuddle. With all of the competing information in the ether how can you possibly trust your own judgement and decide on such an important matter for yourself?

The purpose of The Leave Alliance bloggers throughout this referendum campaign has been to bring some much needed clarity to proceedings—to narrow the plausibility scope with respect to how Britain could leave the EU—in order that the decision facing people may be made comprehensible. Of course there are uncertainties and one has doubts, but that does not mean that you are helpless, a child alone in need of adult supervision and entirely beholden to “experts”.

Ultimately, the decision in this referendum is simple. Either you vote for democracy and accountable government or you submit to people who would bully and cajole you into voting for something else.

To that end, I fear that the lead for “leave” is soft. The Vote Leave campaign is not making the kinds of reassuring noises that people need to hear. We cannot know what “leave” looks like but we can make credible proposals for how Britain could leave the EU with minimal disruption. I have done so and the other Leave Alliance bloggers have done so several times.

Broadly speaking the safe route out of the EU involves seeking to rejoin EFTA in order to use the EEA agreement as a transitional step on the road to something far better—as outlined in the Flexcit plan—a genuine European free trade area. But the Vote Leave campaign is such that the more visionary aspects of what Britain’s future could be outside the moribund EU have of necessity been neglected so as to emphasise the importance of taking that first step on the road to an independent Britain.

I know at least one person who would be voting to leave the EU were Michael Gove making the arguments that I have put to him about an EEA transition. Credible proposals for managing the Brexit transition could make all the difference at this stage. But I can only reach so many.

I have never been in any doubt that I would vote for Britain to leave the European Union on the 23rd June. It was never about the money and I have never needed reassurance about the economy—never in human history has people having more freedom led to less prosperity. Whatever number George Osborne plucks out of the air, democracy and accountable government are worth that price.

Thinking Beyond The Bubble

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If we want to get a handle on the immigration situation, the UK government will need to work to foster conditions that promote economic prosperity and political stability around the world. Poverty and war are two of the primary drivers of migration across Africa, Latin America, Asia and the Middle East. This is a global problem which requires global solutions.

As an EU Member State, many of the policy tools that would be at the disposal of the UK government are presently wielded by EU institutions. Trade policy is an exclusive EU competency and a large proportion of British aid—second only to the United States in terms of absolute expenditure—is administered at an EU level.

What happens with that money from there is less than clear, although, by way of an example, one of the recipients of EU aid money is an organisation called BBC Media Action, which, in 2013, received nearly seven million euros from the Directorate-General for Development and Cooperation for EuropeAid in order to promote media activity across the Middle East and North Africa.

Whether that is an appropriate use of tax-payer resources is difficult to determine without going into detail, but, certainly, the decision was not one that was made with any serious democratic oversight.

By contrast, the other day, I happened upon this tweet from the body in charge of supervising the EEA and Norway Grants—Iceland, Liechtenstein and Norway’s contribution to “reducing disparities and strengthening cooperation in Europe”. This is an important activity in which the UK would undoubteldy be involved post-exit. Outside of the EU, however, there would be a greater degree of transparency and accountability with respect to where that money gets spent.

Indeed, the idea of an accountable aid system could be applied in Whitehall as well. As the only country with a legal commitment to spend 0.7 percent of GDP on foreign aid, the UK government should be taking how and where we spend that money much more seriously. The policies that we promote through our aid programme are important in terms of acting in the common good and advancing British interests by means of soft power.

Mobile Money and the Department for International Development

The International Telecommunications Union (ITU) estimates that the mobile-cellular penetration rate stands at 96 percent globally; 128 percent in developed countries; and 89 percent in developing countries. The liberalisation of basic telecommunications services, following a World Trade Organisation (WTO) agreement, which came into force on 1st January 1998, has enabled mobile markets that are more open and better regulated than their fixed-line equivalents to flourish. Whereas land-line services are still mainly provided by formerly state-owned incumbents—especially in the developing world—the mobile space is characterised by its diversity. Competition between network operators, equipment suppliers and high-street retailers has resulted in lower prices and better quality of service for millions of telecommunications customers.

The unprecedented speed of cell-phone adoption in the developing world has transformed the mobile phone from a simple communications tool to a service delivery platform, enabling millions of African, Asian and Latin American consumers to ‘leap-frog’ fixed-line telecommunications in favour of cheaper and more adaptable cellular alternatives. In 1999, only 10 percent of people living in Africa had access to mobile phone coverage, today that figure is in excess of 80 percent, with more than 10 times as many mobile phones as landlines in sub-Saharan Africa.

To that end, one of the most successful foreign aid initiatives funded by the UK government over recent years was the M-Pesa mobile money service—developed by Vodafone subsidiary, Safaricom, in co-operation with the Department for International Development. Mobile money provides a means for people who do not have access to traditional bank accounts to transfer and store cash. Approximately 25 percent of Kenya’s gross domestic product (GDP) now flows through M-Pesa, which is used by over 17 million people—more than two-thirds of Kenya’s adult population.

Initially marketed as a way to send and receive remittance payments, mobile money is now being thought about much more broadly. There are currently 228 live deployments of mobile money services in 85 countries, as well as 115 planned deployments, mostly in developing countries.

With a View to the Future

I offer this as only one example of a worthwhile initiative, alongside the recognition that far too much foreign aid money is wasted on frivolous, pointless and sometimes harmful and regressive projects—the EU policy of not supporting coal-powered power projects in the developing world, where the demand for electricity still far outstrips supply, is both harmful and regressive.

An integrated trade and aid policy under democratic control of the British people could become a tool for removing technical barriers to trade, through support of the rules-based multilateral institutions empowered by the WTO Agreement on Technical Barriers to Trade, and by removing physical barriers to trade by investing in and supporting the building of modern roads and ports, while also providing training to authorities to improve surveillance and enforcement systems. Rather than providing a means for politicians and others to burnish their own virtue at tax payer expense, an independent trade and aid policy would become a tool to advance British policy aims, such as opening new markets for exports (including our world-class service expertise) and reducing the “push factors” that drive much immigration while also benefiting the internal and intra-market trade between developing economies.

Providing expertise and assistance to help emerging economies grow their human capital is the only long-term approach that will address the migrant crisis which EU institutions and the UK government (as part of the EU) have allowed to fester. If we want to solve global problems we have to start thinking globally and I would suggest that abandoning EU parochialism, which prioritises political integration regardless of the costs, and taking responsibility for governing our own affairs, holding elected officials within our own administration to account is the first practical and pragmatic step towards a political settlement that is better for everybody.

I Read The News Today – Oh Boy

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Yesterday several famous people signed a letter organised by the Stronger In campaign and the Prime Minister walked over the pedestrian crossing outside Abbey Road Studios. Just another day in the life of Britain’s unreal EU referendum.

Don’t get me wrong, I am as eager as the next man to read Benedict Cumberbatch’s political opinions. However, as I perused the impassioned and heartfelt letter to which Jude Law had also added his signature, I could not help but wonder at Aaron Wildavsky’s perennial policy question, “But is it true?”

For the most part, the letter repeats establishment talking points opposing a radical change to the way in which we do politics in this country and the biggest shake-up of the civil service in over 100 years. Echoing sentiments expressed by those selfless warriors after social justice and the public good, David Cameron and George Osborne, Cumberbatch and co tell us that: “many of us [them] have worked on projects that would never have happened without vital EU funding or by collaborating across borders”.

I would like to think it goes without saying that leaving the EU does not preclude collaboration across borders. Indeed, if we look at the Cultural Europe Programme, which provides state support for producers and distributors working in the audiovisual sector, we can see that every EEA state participates fully in the Culture and MEDIA sub-programmes, alongside EU Member States and non-EU Member States including Albania, Bosnia and Herzegovina and Montenegro.

The Cultural Europe Programme has an annual budget of €182.2 million (around £140 million), which it distributes in the form of grants, aiming to “foster the safeguarding and promotion of European cultural and linguistic diversity and strengthen the competitiveness of the culture and creative sectors”. That money is obviously available to projects hosted across the EU and in other participating countries. By way of contrast, UK-based film productions—that is, excluding the far larger television, radio and computer game industries—expended roughly £1 billion last year.

The UK audiovisual sector is the largest in Europe in cash terms. If there is an industry that need not be concerned about the economic impact of EU exit it is film and television. The UK government would not attempt to leave the EU in anything other than measured steps. It is once Britain moves out into the EEA that we will start to examine and adapt policies to work in the national interest.

To that end, film policy—an area I know quite well—is rife for reform. Successive governments, starting with New Labour and the introduction of the UK Film Council (since folded into the BFI), have turned British film production into a corporatist racket, distributing massive tax breaks to Hollywood studios under the auspices of a policy instrument which was supposed to promote British storytelling.

Specifically, we may wish to review the wording of the BFI Cultural Test. What started out as a mechanism to let Labour ministers ponce around London as if they were Hollywood movie executives… Sorry, let me try that again. What I meant to say was a mechanism to shuffle money out of the public purse into the wallets of the US studios that produce the Bond and Harry Potter films… Dang! Last time… a means to support British film production (phew!), the Cultural Test has been adapted several times since then, making the criteria for what qualifies as a “British film” ever wider.

The latest version of the Cultural Test, introduced by the coalition in November 2014, refers not to “British” characters, actors, locations or subject matter, but to “British or EEA citizens or residents” and subject matter. In other words, a film set in Poland, based on a German short story about Hungarian characters who speak Finnish, could qualify as a “British film”, provided that at least 15 percent of its production budget was spent in the UK.

That may sound extreme, but it is also current UK government policy. What is much more common, however, is for Hollywood studios—with the consent of the UK government—to use the Cultural Test as a means to (effectively) cut production costs. I doubt that many people outside the industry are aware that, as far as the BFI and the UK government are concerned, Inception, The Dark Knight, Avengers: Age of Ultron and Star Wars: The Force Awakens are “British films”. That is something we may wish to change.

Don’t call us Benedict, we’ll call you.

Broadening Our Horizons

I know very little about the organisation UK in a Changing Europe, but whenever I have interacted with its director, Anand Menon, I have found him creditably frank in refuting idiocy on both sides of the referendum debate. His article for the FT about the possibility of enhanced UK-EU co-operation post-exit largely reflects my own view of Brexit.

The crucial point, in my opinion, is that post-exit any such decision would be a conscious policy choice, taken with the knowledge and consent of the British electorate.

Leaving the EU is not about ending our relationship with the EU, it is about reorienting our relationship in a way that is more amenable to both parties.

Outside of the euro and “ever closer union”, Britain has no role in the EU. There are, however, enormous opportunities open to a self-confident, self-governing, free trading UK released from the supranational EU policy straitjacket.

So it is with a degree of respect that I offer the following rejoinder to this UK in a Changing Europe report on the so-called Norway Option. Indeed, I would like to think that these perspectives could inform the organisation’s future work.

The article begins:

Norway is central to the debate about British membership of the EU, because it is often talked about as a possible model for a new UK-EU relationship. Norway is not a member of the EU. It is in the European Economic Area (EEA), along with Iceland and Liechtenstein.

I am happy to promote the Norway Option as a desirable exit route on its own merits, but it is important to note that Flexcit—the only comprehensive transition plan so far presented by any “leave” group—proposes using EFTA EEA membership as a “staging post” for a post-exit UK; a firm foundation on which to build a longer-term relationship centred upon trade and co-operation but without the unwelcome encumbrance of political integration.

The pragmatic acceptance of an EFTA EEA position immediately post-exit eliminates the economic uncertainties that both the UK and the EU would wish to avoid should the British public cast a vote to leave the EU. Regulation, immigration and cost would remain largely unchanged, in the initial phase, so as to facilitate an Article 50 agreement within the minimum two-year timescale guaranteed under the terms of the EU treaties.

With that one rider in mind, let us move on with the UK in a Changing Europe analysis:

Norway follows a lot of the EU laws that the UK currently does

As a proportion, the EEA acquis is one quarter the size of the current EU acquis. Whether that denotes “a lot” is a matter of interpretation. It is also vitally important to note that the EEA acquis falls under the jurisdiction of the EFTA court, which is a very different animal to the avowedly political European Court of Justice (ECJ).

It must, in principle, comply with EU laws on a broad range of issues: the single market, competition, social policy, environmental policy, state aid, transport policy, financial services, indirect taxation, consumer protection and company law.

Apart from agriculture and trade with non-EU countries, Norway is covered by all the significant EU laws that apply to the UK, according to UK in a Changing Europe Fellow Damian Chalmers.

Agriculture and trade are two enormous areas of policy with quite extraordinary reach into Britain’s broader policy-making framework. That “apart from” could be interpreted as implying that these policy areas are in some sense diminutive. They most certainly are not. Indeed, trading agility, flexibility and self-representation at the global level are strong reasons to Brexit in their own right.

Damian Chalmers also neglects to mention fisheries, justice & home affairs, foreign aid, foreign and defense policy, in which EFTA EEA members are not bound by common EU policies. Moreover, EFTA EEA states have full self-representation on the increasingly important intergovernmental bodies which define the standards that form the basis for most Single Market regulation. An independent voice, vote and right of reservation at the global level—outside the “common position” of the EU28—gives EFTA EEA members more say than any EU Member State over the standards that are later adopted by the EU.

As EU laws are made, they’re passed to a committee made up of EU civil servants and civil servants from the EEA states to be made into laws that apply in those countries. These have to match the EU version “as closely as possible”.

So in a sense, following this model would mean that the British, like the Norwegians, would become ‘rule-takers’ not ‘rule-makers’. Insofar as EU rules apply to them, they are made by others.

This line about the Norwegians being ‘rule-takers’ rather than ‘rule-makers’ is the reverse of the truth. It is EU Member States which have their voices muted where it really matters. Independent self-governing countries set the agenda which the supranational EU is obliged—by virtue of the international agreements to which it is party—to follow.

Norway has some influence on EU law-making, but it’s limited

That said, the Norwegians are not passive in the EU law-making process.

They are informally consulted on any proposal for a new EU law. Norwegian experts participate in the drafting process like EU member countries’ experts.

Norwegian influence is limited, however, as Norway does not have a vote on the EU law adopted.

Yet EEA enjoy more wiggle room than EU states in their obligation to follow EU law.

EFTA EEA states also have a unilateral opt-out from any EU law. This gives EFTA EEA states, like Norway, more say than any EU Member State, which, while their representatives are present when the EU votes, are nevertheless treaty-bound to abide by decisions-reached under Qualified Majority Voting (QMV) in the Council of the EU. Norwegians, on the other hand, need never face the prospect of laws being imposed upon them without the explicit consent of their national representatives.

There are ways for Norway to refer EU laws to its own parliament

Norway, Iceland and Liechtenstein can refer a matter for consideration to their own parliaments whenever it is felt to be constitutionally required.

This happens frequently. Since 1 January 2004, it has been used for around 550 EEA measures.

These constitutional requirements do not allow Iceland, Norway or Liechtenstein to opt out of EU law, but greater leeway can be given to the phrase “as closely as possible” in such circumstances.

The Norwegian government, for example, believes that EU rules can be adapted if they involve “a change in Norwegian policy that is considered to be problematic”.

In theory, Norway can refuse to implement an EU law it’s supposed to follow

The EEA Agreement does give Norway, Iceland and Liechtenstein a ‘right of reservation’ which allows them not to implement an EU law they would otherwise be required to. Norway has only formally invoked it once, in 2011 over the third Postal Services Directive, which sought to open up the delivery of letters to competition. To put this into perspective, in 2014 Norway implemented 627 EU laws.

The right of reservation may be used so rarely because the EU can suspend the “affected part” of the Agreement in response. Professor Chalmers says that this is a strong countermeasure that will, in many instances, mean shutting down EU market access in the sector. In 2013, after much pressure from the EU, Norway lifted its reservation over the Postal Services Directive.

The other weakness of the right of reservation is that it can only be invoked when laws are being brought in. If Norway passes an EU law and then finds that it has negative consequences, it is not allowed by the Agreement to repeal that law.

While dogmatic “neoliberals” may look with horror upon the ability of national governments to restrict competition in specific industries or product categories, the ability to do so is an example of that democracy thing about which our politicians like to speak but towards which they evince little commitment. Shorter lines of accountability and reduced complexity should concentrate minds. You can’t call it co-operation if one party is not entitled to opt-out; forced collaboration is an oxymoron; a synonymy for coercion.

The remainder of the article addresses the issue of cost, to which I can but say, international co-operation costs money; and the issue of Swiss bilateral agreements, which Britain could not and would not seek to replicate during the course of an Article 50 exit negotiation.

All in all the UK in a Changing Europe piece is not bad, but it would benefit from a greater understanding of the global dynamic that has transformed the way in which interfacing with the rest of the world via the EU, far from enhancing Britain’s influence, severely limits Britain’s ability to fully participate in the global trading and regulatory system.