Former MEP, economist Dr John Whittaker talks ‘Brexit’

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The European issue will be decided by Briton’s on the 23rd June, the Prime Minister announced over the weekend. Speaking outside Downing Street, David Cameron told reporters that this would be “one of the biggest decisions this country will face in our lifetimes”. At present, Cameron is leading the charge to stay in the European Union and advocating for a ‘reformed Europe’. This remains an issue upon which his party is deeply divided, six ministers have announced plans to campaign to leave, whilst Boris Johnson has delivered a blow to David Cameron’s pro-European stance by announcing he favours a British exit. At some time or other, all major British political parties have dabbled in these ideas, of course. Tony Benn has previously stated that after the end of the Second World War, “I took the view that having fought, we should now work with them and cooperate. That was my first thought about it. Then when I saw how the European Union was developing, it was very obvious that what they had in mind was not democratic.”

As a former Member of the European Parliament, Dr John Whittaker believes that we should opt to leave. When asked how he arrived at his position, Whittaker said, “I suppose there were two things. As an economist, I was looking at the operation of monetary systems.” Whittaker ventured into Economics after completing his PhD in Nuclear Physics. “It was before the Euro started, and I looked at the Maastricht Treaty [which paved the way for political integration]. Most people don’t do that sort of thing. But I looked at the Maastricht Treaty and read all the details of it and decided that this system is not going to work all too well.” The Maastricht Treaty, often referred to the Treaty on the European Union, created the European Union and outlined how the institution would develop.

He continues: “I suppose the other was that my background, family background anyway, is in business in the North West. My brother was running the family firm at the time and every time I spoke with him he was complaining about more and more regulations. Where do regulations come from? Well it dawned on me that a lot of this comes from the European Union. So I did my homework, as a good academic, went into the library, looked at the Official Journal of the European Union and found that indeed a lot of this regulation was coming from Europe, including the building regulations that so irked my brother. I thought, no, this isn’t the right way to run this country. Our government did that job but it seems not. I went to see some people at UKIP and found people I thought seemed to speak a bit of common sense.” Whittaker served as an MEP from 2004-2009, and is no longer involved with UKIP, though he continues to object to the European Union.

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I point out that some political commentators argue that if Britain wasn’t so stand off-ish, we could get what we want more and steer the EU in a direction we like. “That’s a very, very simplistic view in my opinion. If you look back into the history of all this it goes back even before the Common Market was formed and I think one of the driving forces was the agreement between Germany and France to set up some kind of agreement, then the Common Market was originally formed with six members. It was purportedly just a trading agreement but it’s pretty obvious now that even then the political elite wanted much more comprehensive political arrangements between the various countries. As have now turned out to be the case of course.” Amongst the provisions of the Maastricht Treaty is a commitment to implement a common foreign and security policy, to facilitate the free movement of persons and to pursue an ever-closer union amongst the people of Europe.

What many eurosceptics argue is that Britain should not be involved in a supranational organisation of this kind, raising concerns that in the future the existence of such an institution will diminish the role of national government. The EU now has a High Representative of the European Union for Foreign Affairs and Security Policy, in line with the aims of Maastricht, Federica Mogherini, who frequently speaks on behalf of the EU at various forums on foreign policy issues, despite divergences between the countries on international issues. “She is the European Foreign Minister, in all but name, and yet as you know, people don’t know her. People didn’t know that Baroness Ashton was the previous one, a British lady.” He explains that many embassies have been closed down, partly because firstly, we don’t have so much money but also because this is a function being slowly absorbed by the EU. “They’re kind of taking over the British foreign policy or the foreign office operations. Now, do we want that? Well actually, no. I think it’s better probably if Britain’s representing itself rather than using some other agency that is answerable not only to us but to 27 other countries.”

An organisation that tries to unite 28 member states behind common policies faces a huge task, and this can create problems across the board, including in trade negotiations. As Whittaker highlights, “[t]he European Union has been negotiating for at least five, probably ten years to try and get a trading agreement with India sorted out, and there’s always hurdles. There’s always some country in the European Union that objects to some clause. Example being the relationship the Europeans tried to form with Americas, the Trans-Atlantic Trading Partnership. That’s been on-going for years now. It hasn’t been signed yet. Who’s objecting? I don’t know the detail. They say the French are objecting to some agricultural clauses…. If you’ve got 28 people on the European side trying to sway negotiations, it makes it very much more difficult. That’s always the problem, they don’t always agree. They don’t agree about a great deal. They don’t agree on foreign and defence policy. That’s obvious to the attitudes to immigration and the attitudes to Ukraine for instance. Trying to bring them together, when the chips are down, they won’t agree together. Sorry that’s the sad result of European Union, European political union doesn’t work all too well.”

David Cameron’s dissenting cabinet ministers raise similar concerns. Michael Fallon, though pledging to campaign to stay in, told the Telegraph “I will die a Eurosceptic. There are people in the European Union who want to harmonise, who want to centralise and who want to coerce us. They want a more federal Europe.” Whittaker continues: “It’s the operation of the European Union that’s a problem. If it were just a trading relationship, good idea, but it’s not, and it never has been, actually. Its future relies on continually spewing out more and more regulations trying to get its fingers into more and more aspects of our lives. It’s like a bicycle. It’s got to keep going forward, because if it stops it falls over.”

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The fear of Brexit, and the foundation of the ‘In’ campaign, is grounded in the effect that an exit would have on British businesses. Recently, it was widely reported that Goldman Sachs has donated £500,000 to the Britain Stronger in Europe group. Asked about this, Whittaker responds, “I think you have to ask why Goldman Sachs and all these big businesses come out in favour of Britain staying in. It’s about making legislation favourable to their own interests, whether it is keeping out competition, whether it is weakening regulation to make it easier for them, those guys are busy lobbying the European Parliament. They have influence. They want to stay in because it’s useful to them. They are making rules which are good for them and perhaps not so good for the opposition.”

I ask Dr Whittaker, what will be the effect on British businesses if we leave? “That’s an almost impossible one to answer,” he pauses. “There have been numbers of estimates of costs and benefits. These studies look at all welfare loss or benefits for the British economy. I have seen ones on both sides saying it’s going to be largely positive or largely negative. For me, it seems to be somewhere in the middle. There’s not much difference either way. You can’t tell, and even after the event you can’t tell whether you’d be right. It’s a counter-factual situation. If we stay in, you don’t know what it would have been like if we left and vice versa. You can never prove anybody right or wrong. All the estimates have bold assumptions in them that I wouldn’t be interested in making. So the answer is, sorry I don’t know. What drives me to think that we would be better off out is rather more that I think this country would probably feel more confident having a government that actually does the governing in this place. That seems to me to be a more politically and socially stable situation than the one we have got at the moment.”

“There have been comments about a run on the pound if Britain decides to leave. Mr Carney was saying we have to be grateful that there’s so much investment coming into this country because we’re running a balance of payments deficit, a trade deficit. If it wasn’t for that investment we couldn’t pay for those net imports, we can’t rely on their good will if we leave. Well, that’s the most crazy argument I’ve heard in ages, and coming from the Bank of England, I was quite shocked, because if that were the case, if it indeed is going to be such a problem that we leave, then markets don’t wait for the event, they act on the expectation. You would’ve seen the value of the pound falling already. It hasn’t. So that for me is very fine evidence that business’ do not in general find the prospect of Britain leaving the European Union to be a particularly daunting prospect.”

. . . . .

But, if Britain leaves the EU, you would expect that Britain’s relationships with other parts of the world would change to compensate for the loss of EU membership. How would balance be restored, I wonder? “It’s hard to know, all I know is the opportunity is there”, Dr Whittaker says. “It’s a matter now of Britain negotiating with the other countries of the world to establish independent, bilateral trading agreements. The European Union has got 50 or 60 bilateral trading agreements. We would have to renegotiate our own. I don’t think that would be very difficult. I think that countries of the world want to trade with Britain, certainly the European Union countries want to continue trading with Britain. It is in their interests. Some people have said ‘oh the Americans won’t want to have an independent relationship with Britain’. I think that’s nonsense. The Americans and the Britain’s are quite close politically and economically and they would certainly want to form some sort of trading agreement.”

“It would take time. I suppose this is one of the biggest down sides of exit, is that there would be a period of some uncertainty going out a year or two or three in which people in this country would be very concerned about the outcome of the various renegotiations, about the form of the new regulations that would come out, about the form of contracts. There’s a big problem here that lots of trading contracts have been formed between partners and between businesses in different countries based on the existing regulations. Now if the regulations finish because Britain is out of the European Union, there will be a contract left up in the air. It’d be an absolute bonanza for lawyers. There are arguments about the outcomes of various contracts. Nevertheless, let’s get over that period. I see no difficulty whatever about Britain renegotiating trade agreements with other countries.”

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