The EU Is No Longer Fit For Purpose - Hell, Recalling Ambassadors!?

Go to Hell

Oh, dear we seemed to have rattled the EU Lords and Masters. I suggest they put this deal to bed in a sensible way, before they implode. Italy and France are fractured, France is faced with industrial strife that will ensure they are relegated to the Southern league of countries. As the economies continue to splutter under the regulatory burden then France's ability to mask their non-compliance with regulations, that they produce will become more visible, fractures will deepen. What on earth France to recall its EU ambassador to Italy. 

The EU is not fit for purpose! Mrs May made clear, WTO rules In her Lancaster House speech are better than a ‘bad deal’. This was widely interpreted as meaning that the UK would be prepared to walk away from the negotiations if an agreement can not be reached. We will rely on WTO rules as a framework under which to conduct trade. This was supposed to strengthen the UK’s negotiating hand because it implied that if the EU did not play ball with the UK there was a perfectly acceptable fall-back position. Then came remainers, doom sayer's creating many synonyms: Crashing Out, Cliff Edge, Falling off a cliff, falling into the clutches of WTO etc. This of course suited their narrative. But it's wrong, its pure sensationalism to distort the facts. For a start the UK was a founding member of the WTO and still holds its seat at the table. 

Only Stupid People Call People Stupid

Such sound bites have in fact influenced the outcome, but not in a way the EU expected. On one hand the EU have taken comfort that the powers will prevent a no deal. Therefore, the EU offered the worst deal possible. Probably encourage by Blair in order that the people of Britain will see the folly of their way and overturn the vote. On the other hand, people have seen through this and reacted to being labelled as stupid little Englanders. The EU should of known, when we are backed into a corner we rarely emerge in a way the opposition expects. Has history taught these guys' nothing. 

WTO as a proposition is perfectly acceptable.

However, that didn't stop eminent vested parties expressing their fear of a no deal outcome. In October 2016, the heads of four industrial lobby groups, the CBI, the EEF, the ICC and techUK, published an open letter to the Prime Minister saying: …

“Every credible study that has been conducted has shown that this WTO option would do serious and lasting damage to the UK economy and those of our trading partners. The Government should give certainty to business by immediately ruling this option out under any circumstances”. 

Again project fear. At no time have they identified what these ‘credible studies’ were. It's as though they want to portray the WTO is some sort of monster organization that consumes its members — especially juicy new ones like the UK. As I said before it is our brainchild, and we have our place at the WTO table.

USA trades with the EU under WTO

US - EU trade under WTO

For the monster that it is the EU trades with 111 countries including China (and Hong Kong), India, Russia, Brazil, Indonesia, Singapore, and the United States they do this perfectly well under WTO. In fact, they do it better, since the formation of the Single Market in 1993, the growth rate of UK exports to these ‘WTO Only’ countries has been four times faster than the growth of UK exports to the EU. Meanwhile, over this same period, the growth rate of exports from the 14 top ‘WTO Only’ countries to the EU has been 27% higher than exports to the EU from the UK. 

If trading under WTO is so scary then let's just rename it to the ‘American Version’ — because America trades with the EU, including the UK, extremely well. In fact, as umpteen countries do. Suddenly it doesn’t sound so disastrous. Indeed, when you examine the facts about different trading relationships, as collated by the redoubtable Michael Burrage,19 ‘WTO Only’ (Micheal Burrage Senior Research Fellow at Civitas) does not sound unappealing at all. Trading on a ‘WTO Only’ basis rely on the rules of the WTO for their trading arrangements and to settle any disputes. The WTO rules dictate only the maximum tariffs that may be applied. It is perfectly possible for a member country to reduce these tariffs or, indeed, to abolish them altogether. 

It shows that ‘the WTO clutches’ are not at all clutch-like.