Why We Should Leave

By Edi Truell- financier, backer of the Conservative Party and Chairman of Disruptive Capital Finance

“If you repeat a Big Lie often enough, the People will believe it” – Adolf Hitler, Mein Kampf. This seems to be the reasoning behind the Remain campaign: let’s look at the Remain camp contentions, and how the machinery of government has been perverted to justify them.

First, that productivity growth is higher in the EU. This does not seem to hold up to scrutiny, as for the ten years prior to EU membership, UK productivity was +3.7% per year; for the ten years after it was 1.9% per year.

Second, to have access to the single market you must stay in the EU. China exports more to the EU than it does to the US, and China is not in the EU (nor is the US for that matter, another massive EU trade partner.)

Third, because the EU promotes an open economy, it is good for national wealth. The EU is a protectionist grouping imposing tariff barriers on all imports. That means food costs are much higher inside the EU. How is that good for UK consumers and pensioners?  Or for that matter poor farmers in Africa and beyond who for example cannot export their chocolate to the EU without paying a 30% custom duty?

Fourth, there are no plans for an EU army. Article 42 of the Lisbon states:

“1.The common security and defence policy shall be an integral part of the common foreign and security policy. It shall provide the Union with an operational capacity drawing on civilian and military assets…using capabilities provided by the Member States.
2. The common security and defence policy shall include the progressive framing of a common Union defence policy. This will lead to a common defence, when the European Council, acting unanimously, so decides.
3. Member States shall make civilian and military capabilities available to the Union for the implementation of the common security and defence policy, to contribute to the objectives defined by the Council.”

Fifth, the UK will be worse off. Since Treasury paper Cm9250 was based on the wrong premise about Productivity, Openness and Trade benefits; ignored the costs of the UK’s contributions to the EU budget; and failed deliberately to include the associated costs to the UK in terms of health, schooling, transport and housing, I can only assume it was politically motivated. It seems unlikely that the Treasury economists were so bad as to make such basic errors.

Sixth, what would happen to the UK economy if the UK left the EU :

The UK’s exports to the European Union are about 12½% of its gross domestic product. Obviously, that means that the fortunes of 87½% of the UK economy are not directly affected by the terms of its trade relationship with the EU. If the UK does decide to leave the EU, and is unable to agree a special deal (or set of deals) to preserve a free-trading interaction with its neighbours, its exports to the EU would be subject to the common external tariff.

The average level of the common external tariff is usually cited as 4%. So, if the volume of output sold in the EU fell by the implied price rise (i.e., 4%), the drop in exports would be… ½% of GDP.  The notion that the UK could lose as much as 10% of national output – which has been put about by George Osborne on the back of so-called “research” from the Treasury – is obvious baloney.

It is this perversion of a proper process that upsets me the most about the Remain campaign and its abuse of power.

It is symptomatic of the current government. Having promised to secure significant reforms, the Prime Minister didn’t achieve any Treaty change during the renegotiation, which means the EU can still force the UK to contribute to euro bailouts. On top of this, the EU has made clear that it will increase its budget, and a £20 billion hole in Brussels’ finances means that the UK faces a multi-billion pound bill to cover this cost.

This is not the only way that the EU will stifle the UK and increase its demand for funds.

The EU is imposing legislation on the UK to make it less competitive in financial services. When Brussels takes control of our pensions, it will demand “15 times the entire annual British defence budget of £35bn”. The EU’s European Insurance and Occupational Pensions Authority (EIOPA) has planned since 2010 – under the title Solvency 2 – to force companies and in due course governments to adopt a massive amount of extra, expensive red tape around pension funds.

EU commissioners have pushed on with the plans, which would hit the UK much harder than Eurozone countries.  The UK is the biggest centre of insurance worldwide; and the UK has 61% of all the defined benefit pension assets in the EU, but is subjected to regulation set by all 28 EU states.

Frighteningly, as both the European Parliament and EU commission want to see a single tax code, we are moving ever closer to full economic union.

The unelected EU bureaucrats are clear in this aim, one that would naturally eliminate nation states such as the UK. This is a Nazi inspired project, after all, with roots in their “European Economic Community”, that would act as a counterweight to the US and see German dominance of the continent. Sound familiar?

In this climate, the EU is turning more into an ‘EUSSR’, comparable to the Soviet Union- a parallel drawn strongly by famous Soviet dissident Vladimir Bukovsky.

With its structures, unelected bodies and ideologies focused on convergence, Bukovsky sees that the EU is following the same path as the Soviet Union, obliterating nation states and continuing to expand. At the heart of both is the idea that national identity must “wither away”.

Similarly undemocratic and focused on planning, the EU now, like the USSR before, is so dominant that its eventual collapse will trigger a crisis on a similar scale to the break-up of the Soviet Union. But, as Bukovsky says, the sooner the EU is finished the less damage that will be caused.

Instead, let’s be positive – rather than negative – the UK should (re)join EFTA. The European Free Trade Association. EFTA’s trade strategy has evolved progressively beyond the confines of the European continent. Since the late 1990s, the EFTA States have “gone global” with the objective of maintaining and strengthening their competitive position in the world. Through EFTA, the Member States have created one of the world’s largest networks of preferential trade relations. EFTA’s network of free trade agreements (FTAs) secures economic operators preferential access to markets currently of around 440 million consumers outside the European Union.

To give him courage for his Christmas broadcast in 1939 – the beginning of WWII- Queen Elizabeth gave the following extract to her father King George VI:

“And I said to the man who stood at the gate of the year:
“Give me a light that I may tread safely into the unknown.”
And he replied:
“Go out into the darkness and put your hand into the Hand of God.
That shall be to you better than light; and safer than a known way.”

We must also show courage and “go out into the darkness”- this way is safer than the known EU way.