Wednesday, June 22, 2016
10 reasons to vote to stay in the EU
Posted by David Smith at 11:00 AM
Category: Thoughts and responses

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The moment has arrived. The biggest decision voters will take for decades is hours away. Most are unprepared for it, and with good reason. The referendum campaign has also revealed a new and unattractive type of politics in Britain. Just over a year ago we had what was in most respects a conventional general election. Manifestos were published, costings were made, and policies were tested. There was humour, and in the main it was good-humoured. This campaign has been very different, partly because battles within parties are always more fraught than those between them – there has been very little brotherly or sisterly love on show – partly because of the way the immigration card has been played, and partly because of a blatant disregard for facts, overwhelmingly by Vote Leave. Anything goes, and with it the truth.

For those of us who think there is not a credible or remotely sensible case for voting leave, what can we say to influence those who have yet to make up their mind? Here are 10 reasons to stay in the EU, which Britain has made a success of.

1. Crises are best avoided. Nobody can be sure that there will be a sterling crisis, within a wider financial market crisis, if Britain votes to leave. But enough people are saying it to make it highly likely. And it could be very nasty. People may think that these market gyrations are not relevant to them. They are wrong. Memories of the banking crisis of 2008-9 are too recent to mean we can ignore these things, and bank shares - here and in Europe - would come under pressure in the event of a Brexit vote. A sterling plunge, meanwhile, affects everybody, through higher food prices, higher petrol prices, a general increase in the price of imported goods and more expensive foreign holidays. And don’t believe the nonsense about Brexit lowering prices. Negotiating new arrangements for, for example, food imports, will take years, if they can be negotiated at all.

2. Self-inflicted long-term economic damage is never a good idea. The issue is not whether the economy heads straight into recession, though it easily could. It is that over the long-term, on all the plausible analysis, the economy will be smaller, and people on average poorer, with employment and living standards lower, if we vote to leave than if we were to stay in the EU. This would be the first time I can remember that voters would have voted for a poorer future.

3. The single market matters a lot. UK exports to the EU have been affected by the slump in North Sea oil exports since 1999. But the UK has grown by more, on a per capita basis (44%), than America (39%) – as well as the other big EU economies, Germany (34%) and France (26%) – since the single market began in 1993. UK service sector exports to the EU have trebled in 15 years. The UK was instrumental in creating the single market of 500m people, which is far more than a free trade area and which represents a quarter of the global economy, and it would be bizarre to make it harder to access it.

4. Don’t drive away investment. Britain’s success in attracting the lion’s share of foreign direct investment - from inside and outside the EU - reflects a series of factors (and overcomes the disadvantages of, for example, Britain’s skills and infrastructure problems). High on the list is the fact that the UK is in the EU and the single market; named as a key factor by four-fifths of inward investors. If the UK leaves foreign direct investment will fall. Such investment creates jobs and raises productivity. We would be much worse off without it.

5. Businesses, big and small, back continued membership. Every credible business survey shows a majority in favour of staying in the EU, many overwhelmingly. Nearly 1,300 small, medium and large businesses have written to The Times declaring it. It is not true to say most small firms are in favour of Brexit. Some are, but the majority are in favour. Firms know that even apart from the disadvantages of leaving the EU; the process of exit would take years, a process in which time and effort would be devoted to that rather than growing their businesses. This may not matter to the leave campaign’s billionaire backers. It does matter for most businesses, and the people they employ.

6. There’ll be no bonfire of red tape. Britain has amongst the very lowest levels of product and labour market regulation in the OECD, the grouping of 34 industrial countries. Vote Leave has said there will be no reduction of workers’ rights on departure. Politically, in any case, it would be impossible to get a deregulation package through a House of Commons overwhelmingly in favour of continued EU membership. Since “EU red tape” has been one of the strongest pitches by leave campaigners, this is a significant weakness.

7. There’ll be no significant drop in immigration. Non-EU net migration has averaged more than 200,000 a year this century. Every year it exceeds net migration from the EU, sometimes by a very significant margin. Every year it is well above the “tens of thousands”. Some EU migration will continue if we left, and there is nothing to suggest non-EU migration will fall. We need to think about immigration, and we need to think about how we measure it; is it sensible to include genuine students? But leaving the EU is not a solution to migration worries.

8. There’ll be less money to spend on the NHS and other public services. Don’t listen to the snake oil about the savings from our EU budget contribution being available to spending on our domestic priorities. Particularly don’t listen to the dodgy £350m a week figure, which is plain wrong. Do listen to the Institute for Fiscal Studies, which says the public finances will be between £20bn and £40bn a year worse by the end of the decade, even taking into account any savings on the budget contribution. Nobody who works for the public sector, or who cares about public services, should vote to leave the EU.

9. The young know best. Young people favour staying in the EU for good reason, even though they are supposedly the ones most pressured in the job market by EU migration. They are outward-looking and part of that is the openness being in the EU provides. Unlike their grandparents they do not have rose-coloured memories of the 1950s. Most of those grandparents have forgotten the desperate scramble to try to get into Europe in the 1960s when British governments realised the error of not joining the European Economic Community. If history repeats itself a post-Brexit Britain would soon be scrambling to try to get back in the EU.

10. Political leadership is important. Some of the prominent Vote Leave politicians are appealing characters (many are not). But the idea of them being in charge is scary, let alone the idea of them being in control of the economic and financial levers of power. And if that does not worry you enough, think of Nigel Farage.