Tuesday, 14 June 2016

The EU

Every time I start thinking about writing about the EU referendum, I become despondent and don't bother. Because there's so much already been written, and so much utter rubbish being talked, and so much hypothesis disguised as fact that it hardly seems worth adding to the volume of noise blaring out on the subject. On the other hand, my mind will keep nattering away with my own thoughts, so I might as well give my mind access to my fingers and see if it can type something coherent.

One of the other reasons I haven't written anything is there didn't seem much point. I'm not going to change anyone's mind. I'm not really in a position to inform anyone of anything. Everyone I hear talking or read about seems to already have a firm, unwavering opinion and to stoutly believe they are in possession of The Truth. But then I started to hear more normal human beings saying "I'm not sure yet, but I think I know which way I'll vote, maybe." And so, though I'm not hoping, expecting or wanting to change anybody's mind, perhaps I'll prompt some thoughts, or help at least one person focus on the questions that matter most to them, and realise which way they want to vote. I don't want to decide for anyone, and I don't lay claim to being right. But at least I've thought about how to think about it.

First up, I'll put my cards on the table. I'll be voting "Remain". I personally think that the EU is a good thing, and that we as a country are an important part of it, and it is an important part of us. And when I've balanced up the arguments as rationally as I can, I still think that. You might not agree with me, and that's fine. As long as you promise me you've thought about it really hard, because this isn't a "do you prefer chocolate or vanilla?" kind of question. This is a potentially fundamental change to our country's position and interactions with the world.

Risk

This is at the heart of the problem. The whole decision is one big risk. Whatever left, right, middle or purple say, nobody knows what the impact of leaving the EU would be. It's very similar to the Scottish Independence referendum. The SNP could lay claim to all the wonderful things they'd like to see happen if Scotland were an independent nation, but without actually launching off and having a go, it was impossible to say in advance what currency they would use, whether they'd be in the EU, what would happen to the division of the national debt, and a host of other questions. Because until you leave, you don't negotiate all the terms. There's no pre-nup on international treaties. And it's the same with the EU. We can't hammer out some "let's pretend" agreements on trade and immigration and free movement with the rest of the world so we can see what they're like before we leave. No other country is interested in investing years of civil service and diplomatic effort in writing new treaties and agreements just in case we decide to leave the EU. It's a blind jump into waters of unknown depth.

Given that nobody knows what the impact of leaving the EU would be, all we can honestly do is try to balance the risks and decide if they're worth it. And not just one or two of the risks, but all of them. And not just the short-term risks, but the long-term ones. Every person who votes, or indeed chooses not to vote, is making a decision that could echo through the generations.

Trade

If we remain in the EU, not a lot will change. Our current trading agreements will stand, the EU (with us as a voting member) will continue to forge new trade agreements.

If we leave... we will  have to form new trade agreements with other countries. And those trade agreements will be based on how strong our negotiating position is. The strength of our negotiations will depend upon the size of our market. NOT the size of our economy, which is big, but the size of our market. Broadly speaking, the size of our market is the size of our population, which is small (on a global scale). Having a large economy does mean our population is likely to have more money to spend, but even so, we will be limited by the number of people. How many widgets does one person need after all? I found a video clip of Ngaire Woods from Oxford University talking about the issues of re-negotiating trade agreements. It was simple and yet also alarming. Alarming not because she forecasts doom, gloom and catastrophe. She merely points out what we'll have to do, and that we don't know how well it will work. That strikes me as a pretty big risk, and one I'm not sure is such a great one. Our side of the negotiating table doesn't look that strong.

Immigration

This is a hugely emotive topic. And it affects different people to different extents. Some parts of the country have a combination of a high immigrant population and low employment, which breeds resentment and division. Other areas, such as the one I live in, have high employment and a high immigrant population. A world-class university does not remain world-class without bringing in the brightest and the best from all over the world. So my experience of immigrants is completely different from the next person's. Mine is a positive experience. And in my job I see daily how important and useful the free-flow of students and academics around the EU is, and how important the collaborations and joint funding ventures are. And I materially benefit from EU funding that allows universities and institutes all over the EU to buy scientific instruments that I build. And the cold, hard truth is, as I believe I keep mentioning, we don't know what will happen to those funding arrangements and joint ventures if we're on the outside. My company certainly won't be sponsoring another PhD student, nor running EU-wide post-doctoral training courses.

I also have another vested interest in defending the value of inward migration - I am the daughter of a migrant. My family has ebbed and flowed across international borders since at least the 1700s. I find it sad to think that so many people resist the idea of the free movement of people within the EU, because it doesn't just mean foreign nationals coming here, it opens the world to us, it allows us to seek homes and jobs and lives and joy across a glorious, open, varied and rich continent. How can the freedom to do that be so terrifying? We may be an island nation and therefore geographically insular, but we don't have to be mentally and emotionally insular as well.

(And while I'm on the subject of immigration, Boris and his chums' claims that Turkey and Macedonia and whoever else are going to join and promptly "swamp" us with immigrants is, as with much of what Boris says, utter hogwash. No country can join the EU without all existing member states agreeing to it. Which includes us. At the moment. So if we don't want Turkey in? Turkey doesn't get in.)

It's the Economy, stupid

I don't claim to know a huge amount about the intricacies of economics. If I'm honest, I'm not sure most economists know much about the intricacies of economics, given how often they get their predictions wrong. The one thing I do know is that stock markets are nervous. They're jittery and capricious. They panic. And they really, really don't like uncertainty. So I think it's a fair bet that if we vote to leave the EU, the FTSE will duly panic and we'll see a fair chunk of change wiped off the value of the stock market. Oh, and the pound will probably become a lot weaker than it was, because currency trading is also a dark and mysterious world in which uncertainty is frowned upon*. Some of you might be thinking "so what? Who does PhysicsBear think she's talking to? I don't own stocks and shares, what does it matter to me?" Anyone with a private pension should care. Or with parents with private pensions. Because that's where they're invested. 10% off the value of the FTSE is 10% lost from your pension fund. It would (probably) be a short-term effect, so might be a risk worth taking. Unless you happen to be about to draw your pension, in which case now would be a really bad time for it to collapse in value.

There's a special term for a fallacy in economics I didn't know had a name. It's called the lump of labour fallacy. It applies in particular to the concept that foreigners are "coming over here and taking our jobs", and makes use of an erroneous assumption that there are a fixed number of jobs available, a fixed "lump" of work to be done, and that any immigrant gaining work here is doing so at the expense of some poor John Bull who was more deserving. In fact what happens is that immigrants arrive, the economy grows and there is more work to go around. Which is a good thing. Isn't it? Slamming the door in the face of the EU does seem to risk losing that influx of labour and talent, and shrinking the economy. And the statistics are quite clear on the subject. Immigrants, especially EU-immigrants, make a net contribution to the exchequer. They contribute more in tax and national insurance than is paid out in benefits. We are richer by virtue of EU immigrants than we would be without.

"Sovereignty"

I put that in inverted commas, because there are two things that seem to get modged together under that word. And having a friend with a keen legal mind who has hammered one of the things home for me, I wouldn't want to muddle the two here. The first is actual sovereignty. This is a technical term and refers to the control we wield over ourselves by virtue of our Parliament. We still have that. We've always had it. We have never lost and are not going to lose our sovereignty. EU laws and regulations only apply here because an Act of Parliament allows them to, and we can always walk away, as we are being given the option to do now. We are not Poland, and the EU is not the USSR. Leaving would not be some symbolic reclamation of our sovereignty. We never lost it.

What I think people who bandy the term around are often talking about is the sense that we are being ruled from elsewhere, by people and nations we did not choose. And I take exception to that as well. We elect MEPs to the European parliament, and if you don't vote in those elections - why not? We, in the guise of our government, also appoint EU commissioners. Admittedly some of those end up being weasels like Peter Mandelson, but they are at least our weasels, and if we don't want weasels, that's up to us to do something about it. And finally the leader of our government represents us on the European Council. We are not some annex of the EU, being dictated to from "over there". We are part of the EU, a full member, with just as much say as everyone else (and some extremely flexible powers of veto as well).

While we remain within the EU, we are part of the law-making process. Remove ourselves from the EU and we risk being required to meet EU laws to be able to trade freely, without being able to have any impact on the writing of those laws. (This is the position Norway is in). So, yes, outside the EU we might have more control over our laws, but equally we might find ourselves bound by EU laws and with no influence over them, which seems about as far away from "taking back control" as it's possible to get. In fact it sounds a lot more like rolling over and asking to have our tummies tickled.

On this issue, and I apologise if I sound like a stuck record, nobody knows what the impact of leaving the EU would be, but the risk is that we lose control of the law-making process without escaping from its reach. 

Peace in our time

Unlike some of the more extreme opinions expressed by some politicians, I don't think leaving the EU will spell the end of all that is good and noble about Europe or democracy or western civilsation. And I don't think we can necessarily ascribe the 70 years of peace, after a thousand years of wars, solely to the existence of the EU. After all, it's a bit hard to rewind time and have another go at the post-war years without the EU. But the closer we are, socially, economically and politically, the less likely, I hope, we are to resort to war as a solution to a problem.

The aspect of our potential departure from the EU that gives most pause for thought in terms of peace, for me, is the effect on the Good Friday Agreement. It took a long, long time, and a lot of bloodshed before there was finally any semblance of peace in Northern Ireland. And the peace agreement that was forged was dependent upon an open border between Northern Ireland and the Republic of Ireland. If we choose to leave the EU, and implement tighter border controls, that will have to be a closed border. Otherwise with RoI open to the EU, and us closed, we have to close the border to prevent the free-flow of all EU nationals into the UK. Now I don't for one moment suppose that as soon as we close that border, The Troubles will begin again in their full horror. But we will need to re-negotiate the terms of the peace accord. And we will risk disagreement, anger and bloodshed. Feelings still run high on the subject of Northern Ireland's position within the UK. I remember only too clearly what life was like through the eighties, being evacuated from train stations because of bomb threats, what felt like daily reports of bombs and shootings and danger. I hope we never return to those days, and I don't imagine leaving the EU would precipitate such levels of violence. But again, it's another risk because nobody knows what the impact of leaving the EU would be.

And let's not forget Scotland. If the popular vote in Scotland is in favour of remaining in the EU, and yet the UK as a whole vote to leave, it basically gives the SNP carte blanche to call another election on the subject of independence. And I doubt if they'd vote to remain united outside the EU. So a vote to leave the EU risks the dissolution of the UK.

Lies, damned lies and statistics

There have been a lot of numbers bandied about, by both sides, about the costs and benefits and risks of leaving the EU. Boris and his magic £350 million seems to have lodged in everyone's minds, despite being repeatedly disproved. I think I may have said this before, but nobody knows what the impact of leaving the EU would be. And while we may "spend" less by paying less into EU coffers each year, if the price of that is a reduction in the size of our economy, then we could still lose out overall. It's simply not possible to pluck one figure from the air and announce that that single figure represents the net effect of leaving the EU. Both sides have tried, and it's risible. The subject is too large, and too complex, and (dare I say it?) nobody knows what the impact of leaving the EU would be. The interactions of exchange rate, stock market, trade deals, inward investment and immigration have too many variables to genuinely predict what would happen if we left. The one thing that's certain is that the amount we pay in to the EU is far from being the whole picture. And to claim that it is is not dissimilar to announcing that you'd like to pay less income tax because then you'd be "better off". You may well be, in an immediate sense, but if everyone paying less tax then impacts the ability of the country to support its own infrastructure, then you've merely shot yourself in the foot as your health, welfare, defence, environment, transport and education systems disintegrate.

Rallying calls

One of the big problems I perceive with the ability of either campaign to get their points across is that they're rather damned into hyperbole and threat. The Leave campaign has to convince us that we're in a terrible state and the promised land is but an 'x' away. So they spend their efforts sowing discord and disharmony. Persuading us that all ills can be laid at the feet of immigrants and bureaucrats.

Meanwhile the Remain campaign has to try to persuade us that the green we can see on the other side is not grass, but mould and slime and all things unspeakable, so they spend their efforts sowing fear and panic about what might happen. Persuading us that the world, or at least western democracy, will end if we leave the EU.

They're both wrong.

Do you know why?

Nobody knows what the impact of leaving the EU would be.

The thing is, Leave has one big thing on their side. Try chanting this...

What do we want?
More of the same!
When do we want it?
Oh, anytime would be fine, we're generally OK thanks.

Now try this...

What do we want?
Change!
When do we want it?
Now!

See? It's so much easier to campaign for change. So much easier to be convinced that things could, would or should be better. If there is anything in this country that dissatisfies you, then you are open to being told it could be better. Even if the things you are told are not true, or not guaranteed (or even likely) to happen, they are seductive words, murmuring in your ear.

The argument cannot be won or lost on what will happen. In truth it can only really be argued on the basis of what might happen, and what the inherent risks are. We risk a damaging recession, a prolonged period of economic uncertainty and weakened sterling, decreased inward investment, a shrinking economy, the dissolution of the union and continued regulation from a body within which we have no say. At a more nebulous level we risk becoming more insular, inward-looking, nationalistic and tribal. I use none of those terms as compliments. On the other hand... it might all be fine. For me, the risks are too great.

I vote Remain.


* In fact, as far as I can tell, estimates vary on the impact on sterling from the optimistic 5% drop in exchange rate, through to the pessimistic 20% drop. Neither seem great to me.

3 comments:

  1. I do read your blogs, I tend to bundle them up and read in one go when I have time on my hands. But, this is fantastically written and I am going to share. I have a lot of friends who I grew up with in East London/Essex that are Brexit fans, they live in a high immigration and low employment area and that seems to be their main motive in leaving the EU. I'm curious to how they will respond, if at all. Well done, my thoughts without all the time and effort of writing them down.

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    1. Thank you Pamela. I'm pleased, and flattered, that you're choosing to share it.

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  2. I don't have anything new to say on the EU referendum but will say I experience similar despair over a fascist yam being a presidential candidate in my country. WTF, fellow countrypeople? (WTF, all my in laws?)

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