I have held off writing about the referendum being held on 23rd June on Britain’s membership of the European Union (EU), in part because it is such a complex issue and difficult to write about succinctly. However, recent conversations with taxi drivers here in the south-east of England have convinced me that I should indeed respond to my friends across the world who keep asking me what my own thoughts are. I very much fear that the referendum may indeed result in a majority vote to leave the EU, and this frightens me.
I have many concerns over the way in which the European Union ‘functions’, about the costs of this additional tier of European wide government, about the excesses of its bureaucracy and the lifestyles of its bureaucrats, and the attempts by some politicians to make it a truly federal centralised state. However, I have absolutely no doubt that we have to remain within the EU and I have great difficulty in understanding the overly simplistic statements, many of which are erroneous, that are being promulgated by those advocating that we should leave the EU. Quite simply, the UK is part of Europe, and whatever happens in the EU will affect all aspects of our lives whether we remain in or leave. We must therefore remain ‘on the inside’ where we are able to influence the EU’s decision-making processes. Britain has much to contribute to the EU, and much to gain from it. Yes, I voted against our membership of the European Community in 1975, but the conditions were very different then, and more than 40 years of membership have so changed the context that I feel very strongly that we must remain in.
My taxi conversations shocked me because they revealed that many people are going to vote about a single issue that they think is true, and yet that in my view is quite simply wrong. One taxi driver complained, for example, that we are paying £55 million a day to the EU, and that we could better use this money to support our health services and other government expenditure. Whilst it is very difficult to measure the precise financial inputs and benefits of EU membership, it is worth noting that in 2015 the UK would have been liable for £18 billion in contributions if it did not have rebate of almost £5 billion. In practice, the UK therefore paid about £13 billion to the EU last year, but it must be remembered that the EU also provided support for the UK of some £4.5 billion, mainly through payments to farmers and poorer regions in the UK. Britain’s net contribution was therefore in the region of only £8.5 billion, or just over £23 million a day, for which we also get many other intangible benefits that it is difficult to measure in precise financial terms. Moreover, there is no guarantee that any savings would actually be spent on relevant public services or social welfare, even if the UK were to make a net financial saving by leaving the EU.
Another taxi driver claimed that migrants were mainly living in ghettos and that large numbers were simply here to sponge off the generous British benefits system. The impact of migrants on the British economy and society is indeed a highly charged subject, with much contrasting evidence being adduced to support particular ideological positions. My own view is unquestionably that Britain has benefited hugely over many centuries from immigration. From the arrival of Celtic people, through the Roman occupation (1st century BC – 5th century AD), and then the Anglo-Saxon (5th-7th centuries AD) and Norse (8th-11th centuries) invasions, Britain was born through immigration. More recently in the 20th century, immigration from South Asia, the Caribbean and Africa has vastly enhanced our cultural diversity, economic vitality, and social distinctiveness. Immigration from other European countries is but a new dimension of an old tradition. To be sure, the UK (263 people/sq. km.), and particularly England (410 people/sq. km.), is more densely populated than many other European countries such as Germany (229 people/sq. km.) and France (121 people/sq. km.) (Figures from 2012), and there is undoubtedly pressure on housing as well as urban encroachment in rural areas in the UK. However, recent migrants from the EU, about whom there has tended to be most criticism, appear to contribute £1.34 to the British economy for every £1 that they have taken out. While those who migrated before 2000 contributed less, at £1.05, this is still a net financial benefit to the UK. The bottom line, even if only financial figures are considered and all of their social and cultural contributions are ignored, is that EU migrants contribute more to Britain than they take out. I very much prefer living in a country to which people want to come than in one from which people want to leave.
These were the conversations that precipitated my desire to write, but I also want to comment briefly on some of the other things that are being said about many of the political, social, economic and cultural dimensions of EU membership.
- I am amazed that so many people are saying that by leaving the EU we will regain our sovereignty. Boris Johnson, the Mayor of London, has made numerous statements about this, claiming that Britain will inevitably be led into a superstate if we remain in the EU and would lose its sovereignty yet further as a result. Much depends on precisely how sovereignty is defined, but few states actually have absolute sovereignty because the world is already so inter-connected. Not least, countries that sign UN treaties have to abide by them, and numerous trade and other international agreements limit the real freedom of national governments to take truly independent, sovereign decisions. Moreover, whilst in the past some European politicians have indeed had a vision to create a politically united centralised European state, and I have no doubt that the creation of the Euro was one means of trying to do this through the back door, my judgement is that there is now much less appetite for a centralised vision of Europe than was once the case. Indeed, the voice of Britain in Europe has been one of the factors that has tended to limit some of the wilder tendencies of the centralists.
- Others argue that Britain can be ‘great’ again only if we leave Europe. This is complete and utter nonsense! Whether Britain ever was ‘great’ can be debated (much of our ‘greatness’ was gained at the expense of others, thus belying our claim to greatness), but we are now a post-imperial, small and largely insignificant country on the edge of Europe! It is amazing that we still retain some respect in the world. In terms of population we are ranked the 21st largest country in the world, and in terms of size we are the 79th largest country. We are dwarfed by China and India, which themselves dwarf the USA! The future lies with countries such as these, and we need to learn to play by the rules that they will determine if we wish to play at the table. Being part of Europe enables us to have a greater voice than we would otherwise have. We should also not believe that by leaving Europe we will somehow be able to rekindle other special relationships. Those who think that it might bring us closer to the USA miss the point that the USA is itself a failing state, and will soon have to grapple with just the same post-imperial trauma that Britain has come to grips with since the middle of the 20th century.
- The most important point to note here is that European countries, and especially those in the EU, are Britain’s biggest trading partner as a bloc. Again, it is possible to choose various trade figures to make different arguments, but I am persuaded by the argument that the EU is the “UK’s major trading-partner, accounting for 45% of exports and 53% of imports of goods and services in 2014”. Were Britain to leave the EU, there is no guarantee that we would continue to retain a special relationship economically with the EU bloc. Indeed, I would imagine that governments of other European countries would be so infuriated that they would probably seek to isolate Britain as much as possible in terms of any beneficial trade agreements!
- I know that bankers are not the most popular people in Britain, and rightly so given their past misdemeanors! However, the past battles between London and Frankfurt over which city should play the central role in Europe’s banking system testify to what will happen if Britain were to leave the EU. Frankfurt would undoubtedly become the financial captial of the EU, and would therefore become much stronger in its competitiveness with London. This is not to say that London’s financial roles would overnight become defunct, but it is to say that it will become very much tougher for London to maintain its strong position in the global financial markets, which would be to the detriment of Britain as a whole.
- The UK attracts substantial inward investment because foreign investors have traditionally seen us as a strong and stable economy within Europe, and therefor a safe means of accessing wider European markets. If we were to leave Europe, this incentive for foreign investment would vanish overnight, and we would have difficulty in attracting the further investment that has recently played such an important part in fueling our economy.
- Further evidence of the likely economic impact of leaving the EU is the effect that the uncertainty has had on the Sterling-Euro exchange rate, which was around € 1.38 to the pound in early December 2015 and had fallen to just over € 1.26 by the end of February 2016. Although it is very difficult to predict financial markets, most analysts suggest that the pound would fall considerably in value were the referendum to result in a vote to leave the EU. Goldman Sachs, for example, suggests that “if the UK voted to leave the EU, the UK’s current account deficit would still be a source of vulnerability despite some recent improvement. An abrupt and total interruption to incoming capital flows in response to a ‘Brexit’ could see the pound decline by as much as 15-20%.”
- The social impact on the UK of leaving the EU would also be very considerable, not least in terms of social diversity. Whilst some people undoubtedly see an increase in diversity as being negative, I suggest that the greater social mobility and inter-mixing between European people that has resulted from the existence of the EU over the last half century has unquestionably been positive. Understanding different societies better through meeting and socialising with different people is of great importance for reducing tensions and misunderstandings between countries, and this still remain of very great importance even though, hopefully, the devastating 19th and 20th century wars across the continent are now a thing of the past.
- The European Union has also done much to try to ensure a fairer society across Europe, and acts as an important factor in seeking to promote a more communal and less individualistic society than, for example, exists in the USA. I fundamentally disagree with the European human rights agenda as well as some aspects of European social legislation, but I have no doubt that the tempering social effect of the EU has been beneficial in reducing some of the excesses of rampant capitalism.
- Another important aspect of social impact has been reflected in comments that I have received from friends across Europe, who simply cannot believe that people in the UK would be selfish enough, and foolish enough, to leave the EU. This has two particular manifestations: first, the overwhelming reaction of my friends is along the lines of “if people in the UK choose to leave Europe, then we will have little sympathy for them in the future when life gets difficult”; but second, there is a genuine belief that the UK also has much to contribute to Europe, and it will be to Europe’s disadvantage as well if the vote is indeed to leave. The British would be very much missed from Europe, but our truculence in having a referendum has already seriously dented our reputation.
- Finally, there are clear cultural implications of any decision to leave the EU. While cultural exchange, and the ebb and flow of ideas, will undoubtedly continue if the UK was outside the EU, the amount of such exchange at many different levels would decline without the support and encouragement provided by the EU. Not least, the implications for tourist visits are very substantial. According to the Office for National Statistics, UK residents made 43.8 million visit to the EU in 2014, and EU citizens made just over 23 million visits to the UK in the same year. For those who like visiting Europe, the thought of possible new visa requirements, and additional border checks, especially if European governments did not take kindly to the UK’s departure, is hardly a pleasant one!
These are just some of the more important reasons I believe without a shadow of doubt that despite problems with the European Union, we should unquestionably vote to stay in, and continue to play a very active role in reformulating the Union so that it better serves all of the people of Europe. Yes, there are problems with the European bureaucracy, its legal system, and its many excesses, but the people of the UK would be far worse off outside it than remaining within it. The UK is a small, relatively insignificant island off the north-west coast of Europe. In a world increasingly dominated by large powerful states who do not necessarily share our values and interests, we need to continue to work together with people and governments from similar minded countries in Europe if we wish our cultural values, our social system, our economic vitality and our political structure to continue to represent the interests of the people of the UK and Europe more widely.