By definition, a customs union is an agreement between countries to embrace tariff-free trade between members but impose common tariffs on goods imported from non-members. At an EU-level, this means a Common External Tariff (CET), a dizzying array of over 12,651 different taxes (and some quotas to boot) imposed on goods from the rest of the world. The long and short of it is that the EU is internally trade liberating but outwardly protectionist.
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Samizdata quote of the daySamizdata Illuminatus (Arkham, Massachusetts) · Economics, Business & Globalization · European Union · Slogans & Quotations January 15th, 2017 |
 37 comments to Samizdata quote of the day |
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In Brussels, Democracy is an offer that you can’t refuse…
The European Union is not “internally trade liberating” – it is about endless regulations of our domestic (internal) affairs.
It is not just a matter of a Customs Union rather than a Free Trade Zone (like the old European Free Trade Association – EFTA) it is about endless E.U. regulations imposed on our domestic (internal) affairs.
Yes I know I have said that twice – I have been saying it for 30 years, since the “Single European Act” in 1986, and people (such as Christopher Booker) wrote books filled with examples of these regulations. And, no, it is not instead of British regulations.
It is irritating to live in a world where people can discuss a matter whilst ignoring the most important aspects of that matter.
Then you have been wrong for 30 years, well done. Such things are always relative: the Common Market liberated trade for many parts of Europe compared to what was the case before. And the EU has been hugely beneficial for Central European trade with the rest of Europe, and if you cannot see why you are not trying hard enough. Yes, the Common Market mutated into the EU and it gradually became worse than the cure, certainly for the UK, does not change the fact the institution was not all bad and certainly not bad for trade for every country who is a member. I vote in favour of Brexit, BTW.
Yes how dare people not focus on what you insist they should focus on.
While the PMO is correct in the broader sense, that does not invalidate Mr Bourne’s point about the exterior barriers inherent in a customs union.
For example: it is, apparently, forbidden to bring potatoes (even commercially processed, pre-packaged, freeze dried mashed potatoes) from the Americas to the EU. Despite the fact that that’s how Sir Francis Drake (or Sir Walter Raleigh, depending upon whom you believe) introduced the fucking things to England in the first place.
Marcher – I explained what I meant, and you are not making an honest intellectual mistake.
You are liar “Marcher” – the technical name for what you are doing is “lying by omission”. You know perfectly well (and know before I said anything) that the E.U. is not about “freeing” things – it is about endless regulations, but you do not even mention this. Indeed you, quite deliberately and by your own free choice, choose to try and deceive.
You practice deception “Marcher” – but it is a hollow deception as people are “on to you” now.
Your organisation, the European Union, is coming to an end.
the other rob.
Yes the European Union is indeed a Customs Union not a Free Trade Area – I fully accept that.
However, if that was its only flaw even “Marcher” might have a point – but in reality (as you yourself point out) the European Union is much worse than a Customs Union, the European Union is about endless regulations imposed upon our domestic (internal) economic life – NOT just upon trade.
The key supporters (NOT the ordinary mass of victims) of the E.U. are not making some innocent intellectual error – they are, as the example of “Marcher” shows us, utterly evil – and I use the word “evil” after a lot of evidence and long consideration of the matter. They use deception to try and deliberately harm this country – by deceiving the people, and they do this out of hardness of heart (wickedness).
But if the EU had been in place, the potato would not have been introduced, and the Irish potato famine would not have happened!!! The EU will make sure that these things won’t happen again. Any bets on what May’s Brexit statement will have?
You’re still a pompous blowhard and your explanations are worthless (half the time its impossible to know what the hell you mean). And the fact (yes fact) is that for much of Europe, the Common Market and then EU did indeed force liberalisation of trade. The other fact unfortunately is the regulatory overreach and institutional hubris of the absurdly names Europe UNION then steadily and inevitably made the “single market” a net drag on trade, which is why I voted for Brexit (so the EU is not my organisation, schmuck) . But if I was a Romanian businessman I’d probably want the EU to remain for reasons even you should be able to figure out (but maybe not given where your head is jammed).
No, keep it civil gents. Lets have a 100% reduction in epithets.
So Long, and Thanks for All the Fish
😀
Tying to look at this objectively, did the EEC in its original form increase trade within the customs union?
Yes and no. During an era when trade tariffs and import taxes were a major feature (1950 – 1980’s) then I would argue that it did and certainly with the expansion to the EU 27, it accelerated post-Communist states towards freer markets (but not free markets)
Given the cost of both the regulations and the strategic nature of the end goal (a European Superstate), it is easy to argue that the net result of both the EEC and the EU was destructive rather than constructive.
During an era of massive trade liberalisation, some of the worlds greatest trading nations (Britain, Germany, Netherlands primarily), have been locked into a stagnating internal market at the cost of trade with the rest of the world (and our former trading partners in the Anglosphere particularly).
It is not just the regulations that have been a problem, but the lies and damage to Western democracy. Although the laws and regulations can be repealed, the mentality it creates is much more pervasive.
The EEC and the EU is a very simple “Long Con”, involving bait-and-switch to get people to join and then using threats of economic warfare if they want to leave. The vast majority of the European citizens have realised this and either want out or at the very least want changes (less regulation, lower taxes, barriers to immigration) which the unelected bureaucrats of the EU simply cannot allow.
The only people that have benefited from the EU have been the elite within the EU bureaucracy. Everyone else just pays the bill.
http://www.independent.co.uk/news/world/europe/brexit-european-commission-negociator-uk-settlement-bill-michel-barnier-theresa-may-a7477911.html
I see no reason to distinguish regulations from outright tariffs and taxes, in principle, as the former impose unnecessary costs just as the latter do, only indirectly. If anything, I’d argue that regulations applying to specific products, specifying which can or cannot be legally sold within the EU (and these are numerous, IIUC) may even have worse long-term effects than outright customs duties and taxes, partly for reasons to which JG above alludes, but for other “unforeseen”/”invisible” reasons as well. IOW, Paul has it right.
The EU is a wonderful idea that has, lamentably, degenerated into a rotten body. A European union, without borders, and with free movement of people and merchandise is a wonderful idea. Maybe a little utopic and difficult to implement, still, a wonderful idea.
It was not inevitable that it become a suffocating maze of over-regulation and parasitic bureaucracy – but it did. At this stage it seems irreparable and doomed to decadence. Still, it is not certain that outside the EU the various member nations will fare better.
Agreed.
I supported the Common Market. I opposed the EU. I am now of the view that in retrospect it was close to inevitable, given the political culture of France in particular. I thought it would lead to a regulatory race to the bottom (i.e. less) whereas it proved to be a regulatory race to the top in many ways.
My worry and that of many people I know the further east you go is that a collapse of the EU would draw central and eastern Europe back into Russia’s orbit. That is not inevitable but it is certainly possible.
My problem with the EU-leavers is this is not a simple issue but Farage et al treat it as if were so.
No, it shouldn’t be complicated but it is.
My second issue is “regulations”. Does anyone, anyone seriously believe that any conceivable UK government wouldn’t have done as much if not worse completely off their own bat.
But then that would be good ol’ Brit evil and not that dreadful Froggie evil so OK.
Let’s talk about stateism. Did the EU impose the BBC or NHS? Did it introduce Comprehensive Schools. The very idea that a UK outside the EU would be a utopia fails to address these issues.
We should leave the customs union but stay in the single market. This would allow us to forge trade deals with other countries, whilst benefiting from the trading ease the single market affords. The single market is there to address technical barriers to trade, to which Alisa refers. In reality, within a free trading area producers who sell across borders will abide by the most strict regulation that it faces, as producing different goods for different markets is usually a non-starter from a cost perspective (obviously there are exceptions like left and right side driving). For domestic producers or producers that sell outside the single market, then yes, as Marcher says, it is country relative whether the single market produces more or less regulation.
Frankly, the quality of our current crop of politicians inspires very little confidence that they won’t muck up the leaving process badly, so a step by step approach is better. Unlike Marcher (I think) I don’t think that on balance we are better off outside the single market, just yet. And there is the little issue of there not being enough ports (here and on the continent) to cope with the level of trade between us and the rest of the single market. Hard to see that getting built within 2 years. And finally, as NickM says, our politicians are pretty good, world class in fact, at coming up with pointless and political regulations.
“The very idea that a UK outside the EU would be a utopia fails to address these issues.”
Seconded!
And it’s not only the Eastern Europe countries (the Russian threat). South European countries (Spain, Portugal, Italy and Greece) were not doing very well, either, as independent countries.
Indeed. But I think the issue really is this: will it be more or less feasible to work towards rolling back the state with or without the remote Brussels tier of the (super)state? My view is “without”, hence I supported LEAVE. But yes, it is not a simple issue and it is not a straightforward goodies vs. baddies issue at all.
The simple answer to this is “Perhaps”.
But then again you are trying to play one part of the EU superstate against itself which is never going to be a good idea. Even if this was agreed, the French are firmly wedded to the idea of a European superstate which follows French foreign policy ideals and subsidises French farmers, so regulations which we try to avoid as part of the customs union would rapidly be extended to the single market for reasons of “harmonisation” or some other form of EU bureaucratic bullshit.
So the more complex answer to this is “No, because we’d still get shafted”.
Although BRExit hardliners such as myself have been quite clear that “BRExit must mean that we exit the European Union and all its institutions and structures”, many people find that a difficult pill to swallow as they cannot visualise the UK being completely outside of the European Union’s sphere of influence.
This is an understandable fear, but you’d better get used to it because the European Union cannot offer terms that are favourable to us (for fear of creating an incentive to leave for other member nations, leading to a rush for the exits) and so they will be forced to offer us terms which are essentially “Completely In or Completely Out”.
What has been described as “Hard BRExit” is not only the outcome that the European Union will likely offer, but it is the preferable one as it leaves the UK to sink or swim. This has always been a position in which the British have thrived.
Bring it on.
I voted leave for one main reason – it was the only way to express my utter disgust at the direction of travel of the EU.
All these points raised above are valid, but you’re ignoring the most important one – external borders. Sweden is now a third non-native. In one generation, say 20 years, it will be more than 50%. It will become a failed state. Belguim is not far behind. Germany remains to be seen.
Add in the population explosion of the ME and Africa, and secure borders are the only answer to the most serious existential crisis in history. Even the Nazi’s didn’t want a European genocide. Unless there is a massive change in direction, the Kalergi plan will be complete inside 50 years.
John G. I understand your point but if you can get three quarters of the benefit of leaving the single market, and very few of the costs of remaining in the EU, by staying in the single market, which could be accomplished without much disruption, then I don’t think it is a very hard decision.
I am afraid that the alternative to leaving the single market is not some free market utopia, but something worse than the single market, ‘EU light’ for many years, possibly a decade, whilst we negotiate a free trade agreement. Some say that we should just declare all EU law void and then trade under WTO rules. Assuming this is even possible given the depth of the connections that exist. From what I have read this would be highly disruptive (in a bad way).
Anyway, I suspect your conclusion is right. Between British incompetence and European intransigence it isn’t hard to see this getting very messy.
“Between British incompetence and European intransigence it isn’t hard to see this getting very messy.”
So do we just shrug our shoulders and accept the inevitable decline into a horrific EU-superstate?
No. We have to get out and try and deal with the mess that will result. In retrospect, amongst the myriad awful things about the campaign, I was struck by the Remainers cognitive dissonance that 1) it was all about the near-term (<10 year) impact but also 2) this was all about the next generation who would have to live with the consequences for the next 40 years.
They were right about 2), but not in the way they think. The EU will die and it will be horrible, so we should get out now so that we can start to get ourselves on the right track sooner rather than later.
As regards the argument between Paul Marks and Marcher, I have just this to say: any organisation that can foist the Euro upon its population and never breathe a word of remorse as the predicted and pre-warned disaster unfolds upon said benighted population is evil beyond redemption. That one reason alone caused me to vote Leave. It is our duty as decent human beings to bring such an organisation to an end.
@JohnGalt
So Long, Say Thanks For All Our Fish
It feels somewhat academic now, but no Mr Pendant; we would leave the EU but stay in the EEA – which is not the same thing as the EU.
I would short sterling – it will be tempting for the government to print more money to try and fend off the impact on employment of falling outside of the single market.
At the end of the day I would still have voted leave even if I knew that we would leave the single market (which was not what the referendum was about.) A 10% fall in GDP is a small price for freedom when compared to the sacrifices of the War generation.
As the Prime Minister, Mrs Theresa May, pointed an hour or so ago…….
The so called “Single Market” is, in fact, the legal power of the European Union to impose endless regulations upon us – and have the European Court tell us what to do.
Mrs May did not vote for “Leave” Mrs May voted for “Remain” – Mrs May is also on the opposite wing of the Conservative and Unionist Party to me. Mrs May is very much in the tradition (the economic and social tradition) of the Chamberlains of Birmingham – which traces back to “Radical Joe” Chamberlain and his program of 1865.
Mrs May is certainly not a doctrinaire laissez faire person (unlike Paul Marks – who is that), but the Prime Minister has accepted that the British people do NOT want endless regulations imposed upon us by the European Union without our consent – and that this is what the so called “Single Market” means, that staying in the so called “Single Market” would mean no real independence at all.
Nor is this a case of “Western” and “Eastern” Europe.
The European Union imposes its regulations on the Republic of Ireland (and its private demands that the Irish government de facto bankrupt itself by indirectly bailing out German banks – so that it can be then “rescued” by the European Union from the situation the European Union put it in), and the European Union imposes its regulations on Estonia – insisting on the return of some of the regulations that Estonia got rid of when it managed to gain its independence from the former Soviet Union.
If one goes further west than the Republic of Ireland one is in the Atlantic Ocean – and if one goes further east than Estonia one is in Russia.
It is not a matter of “west and east” it is a matter of the legal powers of the European Union to impose endless regulations in the name of the “Single Market”.
I should not have to have written any of the above – as it is obvious as 1+1=2 – but in this age it seems I do have to spell out the obvious.
(remainder of comment deleted by the management… lets have 100% less epithets)
Short version.
The so called “Single Market” is the legal power of the European Union to impose endless regulations upon people in all members states – NOT just concerning international trade, but also in our domestic (internal) economic life.
See the works of Christopher Booker (and many other writers) for examples of these regulations.
One good thing about the Prime Minister’s speech (and I repeat that this lady was a “Remain” person and is on the opposite wing of the Conservative Party from me in general policy) is that the lie “I voted for Brexit, but I support the Single Market” is now dead.
It would be (it is) the same as saying “I voted for independence – but I support the rule of the British people by the European Union”.
There is nothing “hard to understand” about…. the so called Single Market is the legal power of the European Union to impose endless regulations upon the people of member states and have its European Court order people about.
No one really voted to Leave the European Union whilst “supporting the Single Market”.
One can even tell by the language that people who claim to have done that use.
They do not say “I voted for independence” or even “I voted to leave the European Union”.
They say “I voted for Brexit but….” – i.e. they use BBC (“Remain”) language, because they were always “Remain” people.
Still no reason to be upset – as the matter is now settled.
The so called “Single Market”, i.e. the legal power of the European Union to impose regulations on people NOT just in relation to international trade – but in relation to our domestic (internal) economic life, has been REJECTED.
For those interested in the history of the matter.
The power of veto on European Union regulations was taken away in a series of stages (treaties) starting in 1986 – the “Single Market” which Mrs Thatcher was tricked into supporting by Civil Servants (and other such) telling her it was about “liberalising trade”.
In 1986 if someone told me they thought the “Single Market” was about liberalising trade (not about a tidal wave of regulations imposed on our domestic, internal, economic life) I might have believed them – it would depend on who they were, if they were trustworthy on other matters I would believe, in 1986, that they were honestly misinformed about this matter. Mrs Thatcher found out that she had been tricked, over time – but there was nothing the lady could do about it at that time.
However, after more than 30 years of experience (it being 2017 – not 1986) no such honest misunderstanding is possible – unless someone can prove that they have been out of human contact for the last 30 years.
If they can prove this (for example show that they have been in some prison in North Korea) then I will accept that I have been too harsh – and will apologise.
Good girl. She seems to understand that it is better to let the 2-year time-limit of Article 50 tick away like the grains of sand in an hour glass than to signup to terms which end up being “EU Lite” membership (plus immigration). I hope this applies to the demand for 50 Billion Euros in reparations as well.
She might be an authoritarian nightmare, but taking a strong line on EU exit 10 weeks before serving Article 50 (so that EU negotiators at least understand the reality of British Red Lines), is the right way to approach this.
Bloody glad Cameron resigned. The EU would have walked all over that dilly-dallying milksop idiot.
Who will be the next country to leave? Italy seems to want to break away. And how is the pound doing? The economy seems, from here in Australia, to be exceptionally robust.
The exchange rate of the Pound is falling Nicholas – which is a good thing considering that their is a trade deficit with the European Union of 100 billion (billion) – Italy does not have a free exchange rate and so has been turned into an economic colony (captive market) of Germany (as has so much of European Union).
Mark Carney (Governor of the Bank of England) has left a massive “poison pill” for the economy – a vast Credit Bubble that will burst at some point. The resulting economic crises will be blamed on British independence.
Still at least Mark Carney does not say “I supported British Independence – I voted to Leave the European Union”.
Sorry I mean, in BBC “Remain” language, “I voted for Brexit”. Governor Mark Carney at least does not say that. He is an enemy – but at least an open one, he does not pretend to be a friend.
If you are going to quote authority Mr Marks, Mr Booker is pro-single market, anti EU, and would be aghast at Mrs May’s speech.
Yes, the EEA and EU share some law – but only a small portion(25% is the number I have in my head), of which quite a lot is not even EU law but passed through UN rules.
What is now likely to happen is that the UK ends up in a kind of transition limbo where we have to abide by EEA law, possibly with some exceptions if we are lucky, but possibly also maintaining legacy EU laws that aren’t even required as part of the EEA, and we’ll still pay into the EU budget (no, EEA countries do not pay into the EU budget; they pay for specific programs from which they benefit).
I must say that I don’t see the ‘cliff edge’ scenario as particularly likely. The institutions are stronger than the politicians involved and status quo bias will make the temptation to put a patchwork on the relationship irresistible. However, this will be a worse situation from just being in the EEA proper.
I appreciate the anarchist sentiments but unfortunately, the rules like us much more than we like them. Trade is a two way relationship and if one government is bent on putting in place restrictions then there is not much the other can do about it.
Lastly, whatever one’s views are on this I would have expected a serious 10,000 page policy document from now from the government. Instead we get more propaganda.
That sounds like a perfect example of Orwellian Double-Think from 1984.
You can’t be pro-single market and anti EU any more than you can be a strict vegan yet have a bacon sandwich for breakfast every morning.
As for the rest…if you think that BRExit hard-liners are just going to let the Remoaners snatch defeat from the jaws of victory over the EU and give up without a fight, you are very much mistaken.
You miss the point. The thing that you want to have just doesn’t exist. There is no great free trading world out there just waiting for us to escape the clutches of the single market. All that you will end up with through the ‘May approach’ is a poor man’s single market.
Except you are wrong.
And I resent being called a Remoaner given that I am a Leaver. I don’t accept the ‘hard’ and ‘soft’ Brexit distinction either; it should be ‘stupid’ vs. ‘smart’ Brexit. Like most libertarians I am more libertarian than the rest of you put together.
I think Peter Lilly is on the money…
How important are trade deals? As a former trade minister it pains me to admit – their importance is grossly exaggerated. Countries succeed, with or without trade deals, if they produce goods and services other countries want. Thanks to the Uruguay Round, tariffs between developed countries now average low single figures – small beer compared with recent movements in exchange rates. So the most worthwhile trade agreements are with fast growing developing countries which still have high tariffs.
PeterT:
Sure 😆
I might be proven to be wrong in some way or other, but unless you have a fully operational time machine or Crystal ball it is impossible to say at this stage.
I doubt that any of us are “right” about the eventual outcome at this stage, including your pessimistic view of the future of UK / EU trade.
We traded with Europe and the rest of the world before joining the EEC and we will continue to do so once we are out of the EU. Admittedly levels of trade will falter, possibly even go down by a few percent, but all of this is justifiable to get the dead hand of the EU off the tiller.
I fully expect the EU to offer us shitty trade terms, anyone who thinks they won’t doesn’t understand the hubris of the EU bureaucracy. The biggest fear they have is that the UK goes it alone and doesn’t immediately sink into the abyss.
This is why the EU will have no option but to offer shitty terms and why the UK will (indeed must) reject them, because to do so is to reject everything the EU stands for, both the good and the bad.
If you don’t like people calling you a Remoaner, stop projecting their fears.
For myself, I am far more optimistic than I was a year ago. Certainly some craven politician could ruin that, by providing aid and comfort to the enemy, but we’re still better off than we were.
To follow the BoJo’s WWII theme, we might not have escaped the prison camp yet, but we’re in the tunnel and the night is clear and dark. There is every reason for optimism at this point.
Obviously the UK can survive, and, long term, even thrive, but there will be a significant restructuring cost. No doubt once the dust settles there will be plenty of ‘see, we did manage’ comments, but that ignores what will then be the counterfactual of having gone through the smart EEA route. It will of course not then be possible to know what the difference between the two approaches would have been. But there is plenty of reason to suggest, a priori, that the EEA route delivers two thirds of the benefits of leaving the single market with none of the costs. If we are leaving the single market they need to get cracking with building more port capacity to cope with the additional inspections regimes that will apply (not sure how we will deal with the port capacity issue on the continent – perhaps we could build one here and cede it to the Dutch for ten years – could work in principle).
Anyway, it seems like you are getting what you want so I’m happy for you. At least there is some good news at 5pm today.