The EU should offer Britain a binary choice—it should remove all intermediate options such as the Norwegian, Swiss or “EEA-plus” and “EEA-minus” modelsby Anatole Kaletsky / August 9, 2016 / Leave a comment
Now the referendum is over, it is time for the real debate about whether Britain should “Leave” the EU to begin. Without clarity on whatever new arrangements might replace Britain’s EU membership this question is impossible to answer—and serious thinking about the alternative relationship is only just starting on both sides of the Channel.
In Britain, Theresa May’s mantra is “Brexit means Brexit.” Though this is a meaningless tautology, the emotional message is clear. The UK government seems set on what Scottish First Minister Nicola Sturgeon describes as “Hard Brexit”: a total disengagement from Europe that is very different from the cuddly relationship suggested by Boris Johnson, when he said in the referendum campaign: “My policy on cake is pro-having it and pro-eating it.”
Theresa May has stated unequivocally that controlling immigration is her over-riding priority. Therefore, Norway or Switzerland cannot provide models. Speaking in Rome on 28th July, May said: “I think we should be developing the model that suits the UK and the EU—not adopting, necessarily, a model that is on the shelf already.” Secretary of State for Exiting the European Union David Davis has defined his main objective as zero tariffs with the EU and Free Trade Agreements with other countries. Since trade in services attracts no tariffs and is not affected by Free Trade Agreeements, this approach implicitly accepts that Britain’s financial and business services will be excluded from the EU single market.
The prospect of a Hard Brexit will surely cause the “DIY recession” predicted by the former Chancellor George Osborne, as businesses suspend investment and hiring; but this cloud has a silver lining. The economic damage caused by May’s hardline stance will soon become so obvious that she will face a backlash from public opinion and the Tories’ business supporters.