Slaying some Brexit Monsters

Slaying some Brexit Monsters

Robert Henderson

The island of Ireland  

Throughput the Brexit negotiations about  Ireland  ‘s position, both north  and south, the Irish tail has been wagging the British  dog.  This is both ridiculous and dangerous.  At best what is proposed – the Irish Backstop – would keep the UK effectively trapped in the EU   for years and at worst indefinitely?  There would be no end to Brexit wrangling.

How should the UK government have addressed to  Irish situation? The UK should have given the Republic of Ireland (RoI) this choice: leave the EU with the UK and retain free movement and tariff free access to the UK market or remain in the EU and lose the free movement and tariff free access to the UK market.

Almost certainly this would have  forced the RoI  to leave the EU with the UK because so much of their commerce is tied up with the UK.

It is worth noting that the RoI only entered  what was then the European Economicf Community (which they did at the same time as the UK) because the UK joined. Hence, there is a certain logic to it leaving with the UK .

If this  happens  the Irish  border problem disappears because there  would be no need for a border between Northern Ireland and the RoI either for reasons of trade or the movement of people between the UK and the RoI.  Moreover, the  Good Friday Agreement would remain intact and untroubled.

It would also mean that the RoI’s borders could be properly controlled. This  would  prevent the easy access of migrants to the RoI and  reduce the number who use the RoI as a jumping off point to get to the UK mainland.

Would the RoI be able to swallow such an agreement? Well, after more than 40 years the RoI  became a net contributor to the EU budget in 2016 . Moreover, their  net contribution could rise significantly once the UK’s contribution to EU finances is removed, perhaps by  400 million Euros a year..

Apart from the retention of the free movement and tariff free privileges with the EU, the RoI could also benefit by being included in any trade deals the UK struck.

It would also not be unreasonable for the  UK to also offer the RoI  financial help for a few years, say, £2 billion a year for 5 years.

EU citizens in the UK  and UK citizens in the EU

There are around  1 million British citizens in other EU countries and 3-4 million citizens of the  27 other states in the UK. Hence, even if equal rights and benefits were given to both British citizens in the other EU countries and EU citizens in the UK the UK would be a serious loser because of the disparity in numbers between the UK and the EU. .

But it will not  be equal rights and benefits because all EU law requires is for each EU member to treat each member from other EU states  as they would their own people. As the  majority of  EU states have inferior Welfare states to that of the UK  the UK will end up paying more directly and indirectly  on average to each individual member of other EU states than the other EU states will pay for each British citizen.

It is also worth noting as things stand British citizens living in other EU states will not be able to claim  any benefits to from any  state other than the one they are deemed to be resident in at the  time of Brexit. . For example, if you are resident in France you  will not be able  to go to any other EU state and claim benefits.

Nor does the disadvantage for the UK  end there. Those with a permanent right to  live in the UK will acquire reunion rights  in the UK for members of their families living in the other EU states.  As the disparity between the numbers of   UK   citizens residing in other EU countries and  EU citizens residing in the   UK is roughly in  the ration of 3:1,  there could be many more family reunions in the  UK than in the other EU countries.  Indeed,  citizens of other EU states could potentially  bring in several million people through the family reunion route.

What should the UK d have do to  escape this imbalance?  Refuse to agree to

(1) the right of family reunion.

(2) Set up a system similar to that which exists for healthcare for what might broadly be called welfare  (healthcare, benefits, education etc) whereby  the   UK will pay for the   UK  citizens receiving  provision in the  remaining EU states and the various EU states reimburse the UK for the costs incurred through the provision of welfare to citizens of the remaining  EU states.

Such a system would address the 3:1 difference between the number of EU migrants in the UK and the number of UK migrants in the remaining EU states. However, that would leave the difference in provision of welfare throughout the  EU. This could be  addressed by having a schedule of  welfare provision based on the least   generous welfare provision amongst the remaining EU states. This the UK would provide  for EU citizens but any thing beyond  this restricted provision would have to be paid for either by the member state from which a n EU migrant hailed or by the migrant themselves.

The final Danegeld  to the EU 

Since 1973 when the UK joined the then European Economic Community  Brussels in its various incarnations  has fed deeply on UK taxpayers’ money.and now expects the UK to pay a minimum of £39 billion as a leaving present.   This is outrageous.

A 2015  Vote Leave  estimated how much money the  UK has sent to Brussels using ONS figures at  more than half a trillion pounds. ( If each yea’rs  UK contribution to the EU had been put instead into a sovereign wealth fund and allowed compound interest to work its magic  God alone knows what  the value of the fund would be).

Presently the UK pays around £13 billion gross to the EU and receives around £4 billion back through the rebate.  That  means the UK contribution is around £9 billion a year. However, the UK cannot spend the  £4 billion  it receives back from Brussels as it wishes.  While we are in  EU  Brussels determines that.  After Brexit, the UK will be able  decide what to do with the entire gross contribution to the EU, either spend it or use it to reduce taxes.

As a final grab for UK taxpayers’ money the EU persuaded Theresa may to agree to pay the EU at least £39 billion  (and it could be more) as part of  the withdrawal deal she e agreed with the EU.

The economist  Andrew Lilico writing in the  Daily Telegraph suggested that the outstanding  bill for legitimate obligations  was much smaller than the £39 billion  (££7-9 billion)  because  (1) the UK has paid pro rat the  UK’s annual membership fee following the delay in March  (2), a  No Deal departure will end those payments  (3)  much of the  rest of the money allegedly owed is illegitimate because it  derives from post-Brexit expenditure from which the UK  derives no benefit. Lilico made this analogy:

“Suppose that you lived in Iceland, and whilst there you voted in Icelandic elections. You might have voted for the Icelandic government or against it, but in some sense you were part of choosing it.

“The Icelandic government made some spending commitments, which required taxes to fund. Fine — you were part of choosing the government so even if you voted against the measure you’ll still have to pay the tax. In the same way, although we in the UK might have sometimes agreed and sometimes disagreed with EU spending decisions, at the end of the day we were part of making them so we have to pay the taxes associated.

“But now suppose you leave Iceland to move to Peru, but then the Icelandic government came to you in Peru and said: “When you were a voter in Iceland, we decided to build a bridge. I know we haven’t started building it yet, but the decision was made when you lived in Iceland, so you owe us $2,000 in taxes.”

“What would you think? I think you would think: I’ve left Iceland. I won’t benefit from the bridge and I am no longer part of the collective “us”, the Icelandic people, that will benefit from the bridge either. So what has funding that bridge got to do with me? If my $2,000 is really so crucial to funding the bridge, perhaps they’d better cancel it now I’m gone? “

There are obligations  such as  EU pensions which might  at first glance seem to be  legitimate UK obligations  but there are complications even there. For example, would the UK only be liable for paying a proportion of  pensions paid to all  EU pensioners or just the British ones?  If it is all pensions  at the point of Brexit would this include pension built up before the UK joined the then EEC in 1973? What about uprating of pensions in the future?  Could the UK get stung for extra contributions even after Brexit?

The advantages of a  No Deal Brexit

Leaving with NO Deal means :

1.The UK immediately ceases to pay the gross annual membership fee of £13 billion or so net.

2 The UK can refuse to agree to any payment until a trade deal is agreed. This reverses the situation Theresa May put the UK in.

3. The UK can begin making trade deals throughout the world.

4. The EU will probably be anxious to make a trade deal with the UK because the balance of trade is so much in the EU’s favour.

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