The European Union is one of the most divisive arguments in
British politics and has once again been pushed front and centre by the
televised debates between Liberal Democrat leader and Deputy Prime Minister
Nick Clegg and UKIP frontman Nigel Farage.
According to the subsequent YouGov polls Farage emerged the
clear winner of the first debate, where facts took second place to
grandstanding and rhetoric.
This blog is, as anyone who has read it will know,
unashamedly pro-European, but this is not to say it stands by how the EU
currently operates. In fact reform of the EU is desperately required, but this
should be done with the UK at the top-table, not as an outsider.
The main focus of these reforms should be to return the EU
to something closer to its original conception as a trading block.
Unfortunately, the EU itself has become far to political and the fears of
Eurosceptic’s about powers being delegated away from the country’s parliament
do certainly have some validity.
Currently, we can only assume David Cameron holds a similar
view-point, with the Prime Minister determined to renegotiate certain treaty
aspects with the EU before holding a referendum in 2017, if he is re-elected,
but the public still have no idea about what powers will be put on the table.
While certainly not directly opposed to a referendum in
2017, after all it has been many decades since the voting public were given a
say on this issue, the main problem is the confusion and doubt this has the
potential to cause, not to mention the issues arising if the UK votes to leave.
The pro-European argument centres on one of the big issues
of the day, the economy and jobs, and this remains the key reason for wanting
to remain as a central member of the club.
While the 3 million job losses figure used by Nick Clegg is
certainly questionable, a recent report by the Centre for Economic and Business
Research (CEBR) suggests 4.2 million jobs are currently supported by the UK
exporting to the EU.
The CEBR does not go as far as to claim 4.2 million jobs
will be lost if the UK leaves, but it is hard to imagine a situation where a UK
exit does not cost jobs.
A good example of this is the head of Nissan, who said the
Japanese car giant would have to seriously consider relocating its
manufacturing base to continental Europe if the UK were to leave.
It would be easy to claim this is just big business towing
the line, but why would Nissan choose to stay in the event of a UK exit?
The population of Europe is around 485 million people, with
the UK accounting for about 70 million of that total, meaning there is many
times the number of consumers on the mainland than there are in Britain.
With this in mind, and taking into account the confusion a
referendum would bring, Nissan and any other company associated with the import
export market would, at the very least, need to plan for a move to the
continent.
Some would choose to leave, others might risk staying to see
what deal a UK government independent of the EU could achieve on trade, but
either way jobs would be put at risk.
Then take into account how long it would realistically take
the UK to negotiate trade deals, not just with the EU, but India, China, USA,
Russia, Brazil and the dozens of other major trading nations worldwide.
Trade deals, however, would prove problematic as again we
have to accept we have a small percentage of the EUs overall consumers, so
countries know they will get a better deal from talks with the EU than an
independent UK.
If a UK exit resulted in Germany and France similarly
ditching the experiment then fine, but this is an unlikely scenario.
Even if the UK could get a good trade deals, something which
is certainly not guaranteed, it could take years, if not decades to iron out
all the details, leaving the UK with a government unable to do anything of
purpose during the interim period.
Yes, the UK might eventually reclaim some of the jobs lost
due to the exit, but there is no guarantee they would come back or how long it
might take, leading to the nightmare scenario of large scale unemployment and negligible
growth for the foreseeable future.
This scenario does not just account for car manufacturers or
import/ export based companies.
The UKs financial sector contributes billions to the
exchequer in corporation and income tax, not to mention making the UK an
obvious centre for international businesses looking to trade with Europe.
If a referendum is called there would be untold fluctuations
in the stock and currency markets as brokers try to second guess what the
outcome will be, not to mention the fact many of the financial institutions
would similarly be forced to consider moving to Germany.
This is not scare-mongering, this is the reality of the UK
contemplating leaving the EU.
This country has already seen how disruptive major
referendums can be, with the Scottish independence vote causing problems
despite the fact it is unlikely Scotland will vote to leave the UK.
However, it would be naive to think the out campaign did not
have some validity, in fact even some of the most disliked groups, such as the
English Defence League, have at the centre of their argument a sensible point.
Yes, unlimited mass immigration is a problem, but the facts
simply do not back up the case.
Farage claimed during the debate that the entire population
of Europe has the right to come to Britain and while he is technically right
this totally misses the point.
Why would the entire population of Germany, France, Spain,
Italy, Portugal and every other EU country suddenly move to the UK? This would
be so economically counter-productive that the idea is almost laughable.
Similarly there is no evidence for benefit tourism, in fact
immigrants put in far more to the government coffers than they take out and in
fact contribute a higher percentage than British people.
There are of course some problems, such as the undercutting
of wage, cash in hand work, non-payment of taxes, overcrowding in rental
properties and bed-sharing.
However, the best way to deal with these things is to attack
the cause of the problem, not by demonising immigrants, as this benefits
everyone in the UK.
It is wrong companies can get away with paying immigrants
below the minimum wage and undercut UK workers, but this should be dealt with
by dealing with the companies paying low salaries, not by restricting
immigration.
Similarly the non-payment of tax, or cash work is also the
fault of the businesses operating in this way, not the people who take the
work.
UKIP recently floated a policy which said immigrants should
be forced to pay into the tax system before being allowed into the country as
to many were taking cash-in-hand work.
On the face of it this seems quite logical if you are
worried about tax evasion, but the problem here is if a company is unscrupulous
enough to pay immigrant workers in this way why would they not similarly pay
British workers in cash?
What the companies in these situations are doing is wrong
both legally and ethically, so the clampdown should be on these businesses not
on the immigrants.
The same goes for overcrowding in rented properties.
Obviously the fact immigrants are willing and able to cram
themselves into properties and bed-share is not the fault of the people living
in the properties, but the landlords who are renting them.
Landlords simply take advantage of the situation. Rent is
taken in cash and not declared to the Inland Revenue and the property is not
maintained because the owner does not need to meet the more exacting standards
or UK born renters.
For years those living in the rental market, including UK
citizens, have complained about the way private landlords behave, but these
complaints have been dismissed as undue interference in a private market.
What this comes down to is the negative impact we associate
with an immigrant population are not actually the fault of the immigrant
population, but caused by those who employ and house them.
Yes, we need immigrants to contribute to society, to pay for
the NHS, schools and other public services, but it is the way they are treated
by employers and landlords which result in the negative impact we associate
with an immigrant population.
If all companies paid the minimum wage and all landlords
abided by basic housing standards, there would not be the pressure on low wages
so often seen as a by-product of a cheap labour influx.
In fact, economists of all political leanings agree a level
of immigration is not only beneficial, but essential for growth and a key
indicator of a growing economy.
One of the greatest pressures currently facing the UK is not
jobs or public service provision, but an aging population.
The immigrants coming to this country are young people,
exactly the generation we need to encourage to prop-up the social costs of
helping our older generations enjoy their retirement.
Conveniently, this does bring us onto the overcrowding
issue, the argument about Britain being basically full and not able to accept
any more people.
While this, like so many of the other arguments, is valid,
it again misses the point.
For starters, the fact the UKs indigenous population is
aging means there is a massive short-fall of younger people, a place now being
taken by migrants and those who come over here, work hard and pay taxes should
be welcomed with open arms.
Secondly, there has been massive under-building in this
country for decades in terms of schools, hospitals and housing and if it takes
an influx of Eastern Europeans for the government and developers to notice this
then so be it.
Lastly, all available data, and remember The UK has a long
history of immigrant populations, suggests the levels naturally even out.
In recent years, for example, it has been shown Polish
people tend not to settle in the UK for the long-term, but contribute to the
UKs economy before returning to their homeland to help improve the prospects of
poorer European countries, particularly if their country of origins economy
starts to pick up.
This trend is well established, having been seen already
from immigrants coming from commonwealth countries and parts of the British
Empire.
On a related point, we often forget the EU open boarder
rules work both ways, allowing UK residents to easily move from their home to
work and set-up businesses all across Europe, benefiting the people of the continent
as a whole.
In fact the number of UK residents currently living abroad
is similar to the number of Eastern European migrants currently estimated to be
in the UK.
The one thing I personally found striking about the EU
debate last week was how Farage has no answers on the big questions.
Yes, he has a position on the key issues such as immigration
and EU membership costs, but he is unable to provide any answers on the
big-issues and it is probably best to not even mention his Putin-supporting foreign
policy.
As a leader of a less-significant national party it is hard
to blame him for this, but in the European elections he is the leader of a
front-runner and should be able to provide more details on how a UK exit would
affect employment rates, the import/ export market, UK-based financial
institutions and how long it would take the UK to renegotiate trade deals.
For better or worse the UK is in the EU and even
contemplating an exit has the potential to bring chaos and uncertainty to what
is still a very fragile recovery and jobs market.
Yes, there is too much bureaucracy and waste in the EU and
the UK does not always get the best out of trade deals, but this is best solved
by ensuring the UK is a significant member of the club, a proud voice standing
up for what the UK and Europe needs, not an isolationist nation.
The best way to achieve this is by electing MEPs who care
about this country’s position in Europe, not Eurosceptic’s whose main goal is
to make themselves unemployed.
