Britain and the EU: a merchant’s perspective.

On Wednesday, 8 March a high profile panel discussed the future of Britain’s relationship with the EU at Nottingham University. Nottingham’s Vice Chancellor Professor David Greenaway was joined by Charles Clarke, former Home Secretary under Labour, Vince Cable, former Secretary of State for Business, Innovation and Skills in the coalition government of the Conservatives and his Liberal Democrats in 2010. Professor Panicos Demetriades, former governor of the Central Bank of Cyprus, complemented the panel. Professor Jagjit Chadha of the National Institute of Economic and Social Research was the chair. In this blog post, I will briefly comment on the discussions, highlighting how they were a perfect reflection of Britain’s general merchant's perspective on European integration.

Photo by Mike Licht

Economic gains versus losses: the narrow view of integration. 

Vince Cable opened the presentations deploring the economic costs resulting from Brexit and the related disruption of free trade policies. Concerns about immigration topped the government’s agenda, he pointed out, regardless of the economic price the country would have to pay for it. Charles Clarke, in turn, outlined why Britain will still rely on skilled workers from overseas in the post-Brexit period in both the private but also public sector and here especially the National Health Service. Immigration is a vital part of a functioning, modern economy, he argued. Finally, David Greenaway, while pointing to the general strength of British Higher Education within the world, made clear that Brexit will involve a loss in research income for universities in the UK.

Little England - Photo by diamond geezer

Clearly, all three presentations made highly sophisticated points about the economic dangers involved in Brexit for the UK. And yet, all three also reflected this rather narrow economic perspective on European integration, in which all what counts is a rather short-term assessment of the economic benefits and costs of EU membership. This had characterised the whole EU referendum campaign with Brexiteers claiming that Brexit would save the country £350 million per week (Independent, 23 June 2016), while the former Chancellor George Osborne maintained that leaving the EU could cost each British household £4300 a year (The Guardian, 18 April 2016). This short-term focused, narrow economic thinking goes right back to the then Prime Minister Margaret Thatcher and her demands for a British rebate in the early 1980s, when the country was apparently paying too much to Brussels.

The EU as a peace project in Europe

Photo by m.p.3

It was left to the former governor of the Central Bank of Cyprus, Professor Panicos Demetriades, to point out that the EU had actually been a peace project, which could not be measured in simple terms of financial gains and losses. Entrusted with the task of speaking about the implications of Brexit for the British financial industry, he spent more than half of his allocated time talking about the wider implications of European integration.

This much broader implication of European integration has never been appreciated nor comprehended in Britain and this is also why British discussions around Brexit appear so strange to people on the European continent. Of course, there are also people in Germany, France or Italy, who question the ‘value’ of the EU. Of course, there are also Eurosceptic parties such as the Front National in France or the Alternative for Germany.

Nevertheless, there is predominantly a very strong sense of the importance of European unity within a changing wider world, not only economically, but especially also politically. There is a deep understanding, a profound appreciation of European integration, the common destiny of European people in these countries. Having joined the EU only in 1973, after it had become apparent that remaining outside had been economically disadvantageous, such an understanding of a shared European destiny had never been developed in the UK. And this is true for both sides in the argument, those who rejoice in Brexit as well as those who bemoan the related economic losses. 

Andreas Bieler

Professor of Political Economy

University of Nottingham/UK

Andreas.Bieler@nottingham.ac.uk

Personal website: http://andreasbieler.net

24 March 2017