When society and state come into conflict, government will always choose the interests of the later. Here is some insight from Michael Wells, who sees what is happening to Gibraltar and why
After nearly 300 years, Spain is regaining control of the Rock of Gibraltar, against the wishes of nearly everyone who actually lives in Gibraltar.
The British government plans to “share sovereignty” with Spain. Until recently, Britain has insisted that any deal would have to be approved by the people of Gibraltar in a referendum, as required by Gibraltar’s constitution, but now they appear to be backing off from that position. Gibraltarians are livid, and the Gibraltar government has refused to take part in the negotiations as anything less than equal players. They’ve even made a desperate appeal to the Queen.
“Shared sovereignty” is merely a foot in the door. Spain considers anything less than full control to be an interim measure and will continue to claim full sovereignty over the territory. Spain’s foreign minister Josep Pique expressed indignation at the idea of a referendum in Gibraltar to accept or reject the agreement: “Negotiations between two sovereign states cannot be subsumed to the will of 30,000 Gibraltarians. The opinion of 30,000 people will not dictate the will of two sovereign states.” The taint of Franco endures.
Britain’s willingness to relinquish control comes partly from Gibraltar’s decreased military significance and partly from a desire to strengthen ties with Spain. According to the Telegraph, Britain wants a closer relationship with Spain to balance the power of France and Germany within the EU, a situation reminiscent of the Habsburg-Bourbon power-jockeying that created the Gibraltar situation in the first place.
But Gibraltar was probably the least significant of what Spain ceded after the War of Succession. Why are they so intent on getting it back? A peevish nationalism is certainly a large factor, but just as important is Gibraltar’s tax status. Gibraltar is exempt from the EU’s tax uniformity and, in particular, has no VAT. Pique’s belligerent ravings about smuggling and money laundering are a result of this, and echo the OECD’s criticisms of ‘harmful’ tax practices.
Gibraltar is an easy target, since it’s already part of the EU. But other European tax havens are at risk as well. Andorra, though ostensibly sovereign, is a co-principality under Spain and France. Monaco reverts to France if there is no male heir to the throne, and is dependent on France for water and electricity. As long as the EU is bent on spreading bureaucracy and high taxes throughout Europe (all EU countries are members of the OECD), the situation looks bleak for Europe’s tiny tax havens.
