Don’t buy Labour’s Remainer mythology
JOSEPH DINNAGE
After the non-event that was the Spring Statement, yesterday’s Mais lecture by Rachel Reeves was supposed to give us the granular detail of the Chancellor’s plan to rescue Britain’s economy. I hope no one held their breath. The speech was at times incoherent, and felt like an exercise in buck-passing more than the decisive plan we were promised. But between the platitudes and hollow justifications for failure, an economic direction could just about be discerned, and all roads lead to Brussels.
As part of Labour’s plan to bring Britain back into the orbit of the European Union, Reeves focused much of her speech on the supposed benefits of closer regulatory alignment with the bloc. For a Government supposedly on a crusade for growth – so much so that the word was mentioned 49 times in Labour’s manifesto – this is a peculiar strategy.
Rather than take accountability for her considerable role in worsening Britain’s economic malaise, Reeves has imitated every left-wing bore on social media by blaming Brexit for our national decline. In yesterday’s lecture, Reeves described Brexit as having created the ‘profound uncertainty’ that has left us so economically vulnerable today.
To get us back on track, Reeves is going to negotiate with the EU a deal which would require us to align with the bloc’s regulatory regime. In return, the Chancellor promises untold growth and fortified ‘economic resilience’.
You may recall that a referendum was held on our membership of the EU in 2016 in which Britain voted to leave. You might also feel that realigning ourselves with the bloc is a betrayal of that democratic mandate, and sounds suspiciously like an attempt to re-enter the single market. Fret not. Reeves insists that she is not turning back the clock, and merely looking towards a ‘new and stable future relationship’. Oh, and I’ve got a bridge to sell if you’re interested.
The truth is that ‘dynamic alignment’ with the EU is not the economic silver bullet it’s sold as by Remainers. One of the greatest opportunities that Brexit offered was the growth potential of freeing ourselves from a system that enforced regulatory uniformity at the harshest, most risk-averse level. Reintegrating ourselves would prove an act of economic self-sabotage.
As part of the Government’s reset, it is considering adopting the EU’s requirements on sanitary and phytosanitary regulations (SPS). It might not get you up in the morning, but it’s an important field. These are the steps taken to protect against the risks of animal and plant life that have been adulterated with contaminants found in certain types of feed. The Growth Commission has calculated the cost to the British economy of ceding this power back to Brussels to be £15 billion and will make our market less competitive.
Replicate these costs across our economy and we will suddenly be lining the pockets of Brussels-based pencil pushers all for the pleasure of having joined an uncompetitive regulatory regime in which most of the long-term members have even lower economic growth than we do already. It would also jeopardise one of Britain’s few industrial successes that could genuinely help us build an economy for the future – artificial intelligence. While imperfect, we have managed to strike a positive balance between sensible regulation and radical policymaking that could see Britain become a world leader in this crucial technology. Alignment with the EU would see the tremendous economic and innovative potential of this progress stifled as we are absorbed into a regime which business leaders from across the bloc have warned will kill innovation.
Keeping it continental, it was the French writer Andre Gide who said that ‘to know how to free oneself is nothing; the arduous thing is to know what to do with one’s freedom’. And this is the bind Reeves finds herself in. Blaming our economic woes on a decision made a decade ago is the ultimate absolution of responsibility. From the job-killing Employment Rights Act to its eye-watering National Insurance rise, there are plenty of decisions this Government has taken that have slammed the brakes on economic growth. How convenient instead to pin all the blame on Brexit: the original sin.
The EU has averaged 1% annual GDP growth for the last two decades. The idea that re-shackling ourselves to this will somehow boost our own economic prospects is for the birds. Labour came into power promising growth by making tough decisions, and if necessary facing down malign influences within the parliamentary party in doing so. It’s taken less than two years in power for them to demonstrate just how quickly they revert to old instincts when the going gets tough.
Free markets and sound money: that was what Nigel Lawson preached in his Mais lecture in 1984. That’s what saved Britain then and it would revive the country now. The combination of Reeves’ ‘active state’ at home and red tape enthusiasts in Brussels will only drive us deeper into the abyss.
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This article (Don’t buy Labour’s Remainer mythology) was created and published by CapX and is republished here under “Fair Use” with attribution to the author Joseph Dinnage
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