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 EU exit: the Norway/UNECE Option

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Following on from the latest Open Europe propaganda, we saw over the weekend in a repeat dose from their "senior political analyst", Christopher Howarth.

At least, in this instance, Howarth descended from his Olympian heights and attempted to argue his case in the comments, but thereby only managed to illustrate the thinness of their analysis. But Open Europe's problem, as we have earlier pointed out, is that they are in reality "little England" with no real idea of the way the world works.

Take for instance, the issue of packing cargo transport units (CTUs – or containers to you and I). Improved, common methodology is very much a practical requirement and, therefore, grist to the mill for international standards-setters, who have been on the case.

In this case, there have been three international organisations on the case, the IMO, the ILO and UNECE, working on a joint code of practice, the latest edition of which was finalised last year.

Alongside this, and entirely predictably, the EU has been producing its own road transport guidelines, which owe a great deal to the IMO/ILO/UNECE code, with all of them relying on specific EN standards, which are common to both texts.

We thus have a classic example of the international community getting together to solve a common problem, which – as the European Commission reminds us - is of some significance. Up to a quarter of truck accidents are linked to poorly secured loads.

However, the crucial rationale for the involvement of international bodies is that, without common rules, national authorities will make their own rules, making it hard for international transporters to know the minimum requirements for journeys covering several countries.

Some people argue for mutual recognition of standards, but pressure comes for common standards if accidents can be pinned on lower standards, especially if one country is seen to be gaining a commercial advantage from working to more relaxed codes. Domestic truck drivers are quick to complain (and rightly so) if foreign truck drivers are working to different standards.

And then, with a plethora of standards, enforcement becomes near-impossible, as vehicle inspectors are required to have a working familiarity with many different codes.

In this context, we are not dealing with mad regulators, creating rules for the sake of it. The rules save lives, reduce "red tape" and facilitate international trade. They are a hard-won asset and a properly constructed body of international law is something to be valued – not, as some would aver, to be removed as quickly as possible.

Therefore, few sensible people with dispute the need for international rules. And very often it makes no sense to have one set of rules for external trade and other for domestic application. Inevitably, there is a natural progression towards regulatory convergence over a wide range of non-contentious issues.

No one, for instance, is going to man the barricades because of an international requirement for all stop lights on vehicles to be red, or for battery sizes to be standardised, so that the same battery type will fit your camera, whether bought in London, New York or Tokyo.

What actually matters, therefore, is not the fact that rules but be agreed, but the way they are agreed – and the nature of the organisations that produce the rule. In short, this is the age-old battle, to which Booker and I referred, as between supranationalism and intergovernmentalism.

In the former, espoused by the EU, individual member states can be over-ruled under majority voting – thus over-riding the sovereignty of the members. In the latter, progress can only be made through consensus, and any one member state can opt out of provisions they do not accept.

The difference is more than adequately summed up in the short history of the 56-member United Nations Economic Commission Europe (UNECE), tells us of the early days of the Commission and the rules set by its first Executive Secretary, Gunnar Myrdal – previously Swedish Minister of Trade:
Very rapidly, Myrdal set out a method and two rules to ensure that the work of the subsidiary organs of the Commission would be practical and acceptable to all parties. First, the method was that "big and general problems, which are set forth in [the] terms of reference [of the subsidiary organs], are tackled in their technical aspects, by dividing these wider problems into their composite parts, so clearly stated and defined that government experts can usefully and effectively discuss them between themselves and seek agreement on practical solutions".

Second, his two rules were that "no meeting is better than a bad one" and that as a rule issues should not be brought to a vote in the working organs of the Commission. "This practice is founded upon recognition of the fact that no economic problem, indeed no important problem whatsoever, concerning sovereign governments can be solved by a majority decision in an intergovernmental organization, but only by agreements between as many governments as are willing to consent".
It is this latter founding rule that defines the essence of an intergovernmental organisation, and is the very antithesis of the regime set up by Jean Monnet, in establishing what has become the EU.

Here, there is also another crucial difference. A key feature of the EU is that the Commission holds the monopoly of proposal, so that only it can propose new laws. And since the only way a law can be removed is by proposing one to abolish it, by this means the Commission retains absolute control over the acquis.

The difference with UNECE is that any member state can propose a new standard (often called "UN Regulations"), and the organisation has a particular tool called the Common Regulatory Objective (CRO), where members can define their needs and convert them into international standards.

Then, through the mechanisms of the WTO Agreement on Technical Barriers to Trade, these can be adopted globally – and in particular by the EU, which is a signatory to the agreement. UNECE thus has the capability and the mechanisms for defining Single Market standards.

Now pulling together more details, readers will recall our earlier piece on the "European village", in which we recounted that when Delors on 17 January 1989 spoke to the European Parliament about the EEA, he referred to the "European village", in which the European Community was but one "house", with another being EFTA.

Delors then was proposing equal partnership in the "European village", with common decision-making in the formulation of the Single Market rule book. And, although, exactly a year later, he was to rescind that offer, the process has actually lived on through UNECE.

In much of my earlier writing about this organisation, though, I have been focused on the car industry and the UNECE-hosted World Forum on the Harmonisation of Vehicle Regulations, known by its short title of WP.29. But just as interesting is Working Party on Regulatory Cooperation and Standardisation Policies, known as WP.6.

This is described as a forum for dialogue among regulators and policy makers, where they discuss a wide range of issues, including technical regulations, standardisation, conformity assessment, metrology, market surveillance and risk management.

The Working Party, through its terms of reference, "makes recommendations that promote regulatory policies to protect the health and safety of consumers and workers, and preserve our natural environment, without creating unnecessary barriers to trade and investment". There is more detail in this brochure.

In common with much international quasi-legislation, none of this has binding effect, but that doesn't stop many of the recommendations becoming regulation through the EU and directly through national legislatures, or from being adopted as guidelines or codes of practice, which can also be given mandatory force.

The work on the container code of practice, with which we opened this piece, however, is handled by one of its many transport committees, the scope of which is vast – so much so that it is truly amazing that the organisation remains so obscure.

This is especially more so as UNECE is a champion of the nation state, remarking in its history document that, despite wild claims from operators in the financial markets, a few multinational companies, and the occasional visionary that the nation state is dead or redundant, a remarkable feature of the new age of globalisation is its resilience.

Indeed, it says, looking at its growth over the last sixty years or so the nation state has prospered: the membership of the United Nations in 1945 was 51 states, rising to 152 in 1979, the year when globalisation was on the point of acceleration, and to 192 today.

Thus, when we look to the future, and the prospect of withdrawing from the EU via the "Norway Option", we then have to think about the next step. That is replacing the EEA with a genuine Single Market, in which there is common decision-making in the "European village", as between the EU and all other nations.

Rather than seeking to re-invent the wheel, as so many have tried to do, we can look to an organisation which is already in place, one which has a sixty-year history of managing intergovernmental forums and has considerable experience in developing the process of globalisation - UNECE. That defines our "European village". 

In its own words, the competence of this organisation, the engrained habits of cooperation, the treatment of all participants on an equal footing, and the demonstration that respect for diversity is compatible with economic and social progress, all add up to a civilised message and inspire confidence in the capacity of UN]ECE to continue to provide good service to the governments and the people of the region.

With that, we end up with a hybrid exit model, which starts off with the "Norway Option" to get us out of the EU and morphs into a UNECE-administered Single Market, hosting the common decision-making process and replacing the EEA. This becomes the "Norway/UNECE Option" - or EFTA/UNECE if you prefer.  What's there not to like?


Richard North 31/03/2015
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 EU exit: an absence of thinking

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The minimal coverage given to Owen Paterson's Heritage speech tells its own story, but even our venal media should have made something of his responses to questions. As it is, only Huff Post picks them up, having Paterson say that "we would lose an 'out' referendum" because his "optimistic vision" has not been explained. "And 'out' is frightening", he added, "it's unknown and people will hang onto nurse".

Paterson's view is that, "we have to go the whole hog, get back to the trade arrangement, but we need time to explain there is a positive destination". He thinks we have "the most spectacular future outside the political and judicial arrangements [of the EU], embracing the trade, commercial and economic aspects", he said. "But at the moment that has not been explained".

"There is a protest party", Ukip, that has done no absolutely no work on the detail [of how to leave]", Paterson told the Americans, "and they are being attacked, quite rightly, for that because their image is backward looking and negative".

As a result, those like him agitating for the United Kingdom to leave the EU needed more time to persuade voters it was a good idea.

There, writ large, is precisely the predicament we're in, on which we elaborated recently, on the back of the YouGov poll that put the "inners" ten points ahead for the second month running.

By coincidence, yesterday we saw the publication of the British Social Attitudes Survey, which very much confirms the YouGov findings. It has 57 percent wanting to continue with EU membership, with only 35 percent wanting to withdraw.

As with YouGov, when a more nuanced question is asked, offering different options, the position changes. Those who want to leave the EU drop to 24 percent, while those who would like to see an attempt made to reduce its powers stands at 38 percent. Only 18 percent want to leave things as they are, ten percent want the EU to have more powers, and four percent want a single (European) government.

The Social Attitudes Survey thus sees most people as being "eurosceptic", defined as wanting to leave the EU, or seeing it with reduced powers. But therein lies the fatal confusion – the "reformers" are not "outers" and it cannot be assumed that they will vote to leave the EU in any referendum.

Here, Paterson's point has particular force. The "eurosceptics" are split between leavers and reformers, and – of the former – there are irreconcilable splits between different groups and sub-sets, and no clarity of vision from the main players.

If there has been any change, it is that these splits are being recognised, although there are no indications that different factions are prepared to debate the issues – or even explore the issues dispassionately.

Thus we have the likes of Ruth Lea arguing for the "WTO option" without troubling to explain why she has suddenly deserted the Swiss Option. And we also have Roger Helmer who tells us that UKIP cannot accept any deal, even an interim deal, that doesn't give us control of our borders.

This is the man who is confident that the UK could negotiate a free trade agreement with the EU but, like so many of his ilk, he simply doesn't do detail.

Presumably Mr Helmer expects the UK to work within the provisions of Article 50, so one assumes that he would be content to wait the ten or more years that it would take the negotiations to reach an agreement. And, all the while we would remain in the EU, paying the contributions, fully committed to freedom of movement – just because Mr Helmer doesn't like interim solutions.

On the other hand, if we went for the "Norway option" they hate so much – or "model" if you must – we could be out in two years, ready to negotiate a longer-term solution, which would include dealing with the vexed question of freedom of movement.

Meanwhile, the FUD flows and the lies proliferate. They are easy to rebut - although far too difficult for the aristocracy.

And that is perhaps the underlying problem. The eurosceptic "aristocracy" have long ceased thinking. And they are, of course, far too grand to debate issues with mere mortals - or get down in the weeds, where the real fighting is going on. Thus, their arguments are fixed in aspic, going nowhere and inspiring no one.

Along with Ukip, they are set to lose us the referendum – if we let them.


Richard North 27/03/2015
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 EU exit: joining the "European village"

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Flagged up at the weekend by the Sunday Telegraph, Owen Paterson has now delivered his speech to Heritage, at the Thatcher Center in Washington. The full text is here.

As with the Europe speech, on which it is loosely based, this has hidden depths, but readers will particularly appreciate this passage:
In short, and this is critical for Americans to understand, it is not so much that Britain should leave the EU, as that the EU is leaving us. It is critical to understand that the economic Single Market and the political EU are not one and the same thing. The Single Market is a formal fact under an arrangement called the European Economic Area (EEA). It is an agreement between EU member states and three of the four members of the European Free Trade Association (EFTA) -- Norway, Iceland, and Lichtenstein minus Switzerland.

By switching our membership to the EEA, Britain can pursue participation in the Single Market without being strapped in the EU’s political and judicial straightjacket. And if we joined EFTA, often described as the "Norway Option", it would become the fourth largest trade bloc in the world.

Confusing membership of the Single Market with membership of the EU is a common error. You can stay in the Single Market and not be in the EU. And the argument that leaving the EU would damage Britain's ability to continue its trade with our European neighbours – thereby damaging the economy of the entire developed world including the US - massively underestimates the huge strategic and selfish interest that our neighbours have in ensuring our continued vigorous participation in the Single Market.
Even at the eleventh hour, I understand, there were attempts to stop Paterson saying that, and you can get a hint of how strident the critics are becoming, from this presentation chaired by Roger Helmer, who dismisses the Norway Option" out of hand, despite one of the speakers being Robert Oulds, who is to speak in support of the proposition.

One can note here the behaviour of Helmer, who is effusive in his praise of the increasingly tiresome Ruth Lea, and her promotion of the suicidal catastrophic "WTO option", yet can barely conceal his dislike for what Robert had to say.

Oulds's speech is worth listening to in full, and especially where he offers Delors as a "teaser", reminding us that on 17 January 1989 to the European Parliament, he spoke to idea of getting the EEA started. But the Commission President's vision, at the time, was of a "European village", in which he saw a house called the "European Community". "We are its sole architects; we are the keepers of its keys", he said, "but we are prepared to open its doors to talk with our neighbours".

Delors was actually proposing to the EFTA member states a "more structured partnership with common decision-making and administrative institutions", basically acknowledging the presence of equal partners in the "European village".

There is more than a hint of this in Owen Paterson's speech, when he argues that our exit from the EU "will strengthen both the global trading system and the foundations of global security". This is, he says, in tune with what Churchill told the House of Commons in June 1950 when he said:
With our position as the centre of the British Empire and Commonwealth and with our fraternal association with the United States in the English-speaking world, we could not accept full membership of a federal system of Europe.
Churchill went on to say:
We must find our path to world unity through the United Nations organisation, which I hope will be re-founded one day upon three or four regional groups, of which a united Europe should certainly be one. By our unique position in the world, Great Britain has an opportunity, if she is worthy of it, to play an important and possibly a decisive part in all the three larger groupings of the Western democracies. Let us make sure that we are worthy of it.
Here is also a version of the "European village", but one which fits in as one of upon three or four regional groups, which themselves are part of the United Nations.

This in turn reflects Churchill's speech to the Congress of Europe at The Hague on 7 May 1948. Then, with others, he argued for the United Nations to be the "paramount authority" in world affairs, but with regional bodies as part of the structure. They would be "august but subordinate", becoming "the massive pillars upon which the world organisation would be founded in majesty and calm".

Although he didn't specifically mention it by name, as far a Europe was concerned, Churchill was referring to UNECE, which had been founded in 1947, with some of the history told here. This, in effect, is the "European village" to which Delors could have been referring, in which the EU and EFTA were but individual "houses" with the same right of decision-making on Single Market rules.

Robert Oulds, in his address, tells us that, exactly a year later, Delors rescinded his offer of common decision-making. By then the Berlin wall had fallen and the EU was eyeing the former Soviet satellites as new members, and did not want to make life outside the EU too attractive.

But, with the EU poised to leave the UK, the moment again is arriving when the EU must concede common decision-making by different "houses" in the "European village", for which purpose Owen Paterson has already suggested UNECE as a suitable forum.

The Americans, yesterday, would not necessarily have understood his nuanced references, but gradually we are seeing the emergence of a credible, long-term alternative to the EU, and one which – oddly enough – Churchill was advocating back in 1950, when he was rejecting the idea of joining Mr Monnet's first supranational government.


Richard North 26/03/2015
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 EU referendum: losing it before we even start

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Published yesterday was the latest YouGov poll on EU sentiment, and it does not make good reading. The ten-point lead for the "inners" established in February is maintained – at 46 percent in favour of remaining in the EU as opposed to 36 percent who would vote to leave in a referendum.

Faced with renegotiations and a recommendation from Mr Cameron that we should stay in, the percentage supporting the EU rises to 57 percent, with only 21 percent wanting to leave – much the same as it was last month.

If there is any consolation to be taken from these figures, one could at least observe that the "Ukip paradox" is broken – the phenomenon where, as Ukip popularity increased, support for leaving the EU declined. As it stands, support for Ukip is currently declining – down to 12 percent according to YouGov and a mere ten percent according to ComRes in the Daily Mail.

If Farage actually knew what shame was, now would be a good time to show it. His tenure as leader of Ukip has delivered what is, on the face of it, an unwinnable hand. Even if Mr Cameron gains a victory at the general election, and gives us a referendum, the chances of winning it must be slight.

Not a little of this must be attributable to Mr Farage's failure to ensure that his party produced a credible exit plan, on top of a clear vision of what a post-exit Britain would look like. Instead, he has ceded the ground to the charlatans of Open Europe and the like, who are so successfully muddying the waters.

OE is even now fielding its chairman, Rodney Leach, who has come out of the woodwork to tell Reuters that: "Transforming Britain into the deregulated, free trading economy it would need to become outside the EU sounds easy in theory, but in practice would come up against some serious political resistance within the UK itself", thus knocking down the straw man of Open Europe's making.

Even Roger Helmer is beginning to realise that OE is not batting on the same side but, having given this Europhile think-tank such a head start, it is going to be very difficult to claw back lost ground – even if Ukip was capable of doing it, which does not look to be the case.

The essential requirement, though, is actually relatively simple – to the extend that Ryan Bourne, head of public policy at the Institute of Economic Affairs, has managed to work it out – even if his message is a tad inconsistent.

He nevertheless says that, if the outers want to win a referendum, "they need to neutralise the economic issue by showing that Britain would be no worse off outside". He adds: "The evidence suggests that, with broadly sensible policies, this is achievable".

That is actually straight from Flexcit (and about the only place you will see it), where the "Norway Option" combined with repatriation of the acquis offers a cost-neutral solution to leaving the EU, and buys time to negotiate a longer-term solution, once we have left.

What we must also do in this context is continually emphasise – as has Owen Paterson been doing - that the Single Market and the political baggage of the European Union are not one and the same. It is possible to leave the EU and remain in the Single Market – which is precisely what the Norway Option - or the "Norway Model" if you prefer – aims to do.

By this means, we can easily address the fear, uncertainty and doubt (FUD), delivered by the likes of Standard Life Chairman Gerry Grimstone, who on the one hand tells us that, "leaving the European Union would be disastrous for Britain and harm its economy" and then in the same breath declares: "It would be disastrous for London and the UK if the UK were to leave the single market".

But it is a measure of the inadequacy of the "eurosceptic" response that we have Robert Oxley, campaign director of Business for Britain, condemning Grimstone for joining in "the scaremongering that life outside of the EU would be disastrous for the UK" – without any attempt to draw the distinction between EU and Single Market membership.

And, while Oxley bleats about the cost of "EU financial regulation", if he lifted his horizons somewhat, he would see from the New York Times that the regulatory agenda is global, with the sub-regional EU only marginally involved in primary standard-setting.

This, though, so much typifies the state of the anti-EU campaign. On the one hand we have the incompetence of Mr Farage and, on the other, the London-based think-tanks entertaining themselves with increasingly arcane and irrelevant arguments – much in the manner that climate-change has degraded into a tedious squabble between rival pundits.

Amid all this, too few people are focusing on what it actually takes to win a referendum. Even if some in Civitas are beginning to steer in the right direct, this is too little, and risks being too late. It leaves us ten points behind in the polls, and still prey to the charlatans who would have us lose the campaign before it even starts. If we are going to win, this is not the way to do it.


Richard North 25/03/2015
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 EU exit: regulation - the "Brussels effect"

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Of all the nonsense dribbled out by the London-based think-tank claque and their fellow travellers, none is quite as pernicious as the constant discussion on EU regulation and the benefits EU withdrawal might bring, especially in terms of the "deregulation" which is supposedly on offer.

Most commentary simply betrays profound ignorance, not only of how industry and trade works, but also of the practical application of regulation in today's society. We even find, in many instances, an almost total lack of appreciation of the nature of regulation – why it actually exists, and the roles it fulfils.

In that context, it is worth going back a little to a paper written in January 2013 (picked out by one of our own commenters), written by Anu Bradford, professor of law at the Columbia Law School. Entitled, "The Brussels Effect: The Rise of a Regulatory Superstate in Europe", it offers important insights into the way regulation works and – of particularly relevance – why it is that certain regulations predominate at global level, and not others.

Without putting too fine a point on it, this paper kicks into touch many of the ill-informed posturing of those who would argue that there is any immediate regulatory relief to be had from leaving the EU. But, as with many things of value in this world, the argument is relatively complex. There are no short-cuts, when it comes to trying to understand the issues.

With that in mind, summarising Anu Bradford's paper is extraordinarily difficult. It is over-long, not well structured, and repetitious. However, in attempting to sum it up, one has to say that the paper is a slow burn, with Bradford telling us that "a deeply underestimated aspect of European power that the discussion on globalisation and power politics overlooks: Europe's unilateral power to regulate global markets".

The European Union, she writes, sets the global rules across a range of areas, such as food, chemicals, competition, and the protection of privacy. EU regulations have a tangible impact on the everyday lives of citizens around the world. To her specific audience, she adds, few Americans are aware that EU regulations determine the makeup they apply in the morning: the cereal they eat for breakfast, the software they use on their computer, and the privacy settings they adjust on their Facebook page.

The EU, we learn, also sets the rules governing the interoffice phone directory they use to call a co-worker. EU regulations dictate what kind of air conditioners Americans use to cool their homes and why their children no longer find soft plastic toys in their McDonald's Happy Meals. This phenomenon, the "Brussels Effect", is the focus of her article.

From there, we begin to get an explanation of what is called "unilateral regulatory globalisation", a process that occurs when a single state is able to externalise its laws and regulations outside its borders through market mechanisms, resulting in the globalisation of standards.

En route to exploring this phenomenon, Bradford takes a look at the so-called "California Effect" where, due to its large market and preference for strict consumer and environmental regulations, California is, at times, effectively able to set the regulatory standards for all the other states.

Businesses willing to export to California must meet its standards, and the prospect of scale economies from uniform production standards gives these firms an incentive to apply this same (strict) standard to their entire production.

This effect expand to become the "Brussels effect", when firms trading internationally find that it is not legally or technically feasible, or economically viable, to maintain different standards in different markets. When trading with the EU requires foreign companies to adjust their conduct or production to EU standards - which often represent the most stringent standards - or else forgo the EU market entirely, they tend to adopt those standards uniformly throughout their entire enterprises.

We saw this in our interview Bjorn Knudtsen, Chairman of the Codex Fish and Fisheries Product Committee. He told us that, when it comes to Norway, trade in fish and fisheries products is a vital national interest, with 95 percent of products, worth €3 billion annually, being exported. And as an exporting country, he said – like other major exporters – strict regulatory standards are a necessary and acceptable price to pay for what he terms "certainty".

Companies preparing a product for export did not know from the outset the destination of any particular batch. Therefore, they wanted to be able to produce to a generic standard which would be accepted in any and every country to which the product might be despatched. They don't want to be producing different batches to different standards.

Thus, we find processors adopting the highest posted standard, as a means of ensuring that the product has access to the largest number of markets. This, Bradford elaborates on, when she argues that, while the EU regulates only its internal market, multinational corporations often have an incentive to standardise their production globally and adhere to a single rule.

It is this mechanism which converts the EU rule into a global rule - the "de facto Brussels Effect". Then, when these export-oriented firms have adjusted their business practices to meet the EU's strict standards, they often have the incentive to lobby their domestic governments to adopt these same standards in an effort to level the playing field against their domestic, non-export-oriented competitors - the "de jure Brussels Effect".

Interestingly, Bradford sees other states are lacking power to affect this process. Countries whose regulatory preferences are overridden by the EU's standards gain nothing by entering into a regulatory race with the EU. Outpacing the EU only leave them with even higher, and hence less desirable, regulatory standards.

As to international institutions, these are regarded as having only an imperfect ability to dampen the EU's regulatory ambitions, which – argues Bradford – means that the greatest check on the EU's regulatory powers comes from within the EU itself. As the EU's powers grow, internal divisions within the EU will increase. In the end, she says, the boundaries of the EU's regulatory reach will be defined by the EU's own evolving conception of the limits of its regulatory authority.

Here, we have to disagree with the Bradford script, as she fails to mention the WTO Agreement on Technical Barriers to Trade, to which the EU is bound and which is increasingly defining the regulatory agenda. Once that is factored in, one sees that international institutions have far greater influence than Anu Bradford would allow.

Nevertheless, Bradford's article is helpful in further exploring the "California Effect" and its transformation in the "Brussels Effect". Existing scholarship, she says, recognises the importance of market size and scale economies as a source of a jurisdiction's external regulatory clout. There are, she says, additional factors, which can prevent a company from producing different varieties for different markets and thereby give effect to the "Brussels Effect".

Wading through this over-long paper (running to 67 pages), the essence is that the "effect" has its greatest impact when Brussels wins the "race to the top". In other words, it is the highest, or strictest standard that wins out, at global level, and for the reasons already set out. This is summed up in one paragraph, telling us that:
… export-oriented EU firms to seek consistent and predictable regulatory frameworks. Uniform regulations have abolished obstacles for doing business within the common market - it is more complicated and costly to comply with multiple, sometimes conflicting regulations than with a harmonised regulatory scheme. And once all European firms have incurred the adjustment costs of conforming to common European standards, they have preferred that those standards are institutionalised globally. Hence, to level the playing field and ensure the competitiveness of European firms, EU corporations have sought to export these standards to third countries.
This is the crunch issue. As trade has globalised, so has regulation, and when it comes to the choice of standard, firms will always opt for the most demanding, simply because it is cheaper and more efficient to work to a single standard than it is to work to multiple standards.

Thus, anyone who thinks that leaving the EU is going to bring about the fabled bonfire of regulation is deluding themselves. Trade may be driven by the demand for goods and services, but it is facilitated by harmonised standards and, whoever produces the strictest standards gets the cream. In or out of the EU, we will continue to see the "Brussels effect" dynamic, and it will ensure that our statute book remains more or less intact.


Richard North 24/03/2015
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 EU exit: Open Europe distorts the debate - again

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Britain faces a stark choice after an EU exit of allowing its economy to shrink by £56 billion, by shutting down its borders, or agreeing to the continued free movement of European citizens in a new deal with Brussels, says the Guardian, citing Open Europe as its source.

This is another thoroughly dishonest report from one of the country's least ethical think tanks, which is now devoting its energies to distorting the "EU exit" debate, in an attempt to garner support for its bankrupt "reform" option.

The tactics adopted are as familiar as they are dishonest, the think tank presenting a series of false choices, downplaying preferred options and playing the "scare" card by going for one of the least realistic options and attaching a massive price tag to it – in this case of 2.23 percent of GDP by 2030, or £56 billion a year.

The "straw man" is then presented by Mats Persson, director of Open Europe, as a challenge to Nigel Farage, who says in a message to the Ukip leader: "You have some questions to answer [on] exactly what you want to see outside. What is it?"

Persson, who is maturing as a consummate, unprincipled liar, thus frames the debate in terms of a "free trading Hong Kong-Britain with very liberal policies, including on migration", which he asserts is "what is needed to make us competitive", or "what probably most of what your [Ukip] voters want: to shut the borders and shut the world out which would mean a net loss in terms of the UK's GDP and economic competitiveness".

By presenting this "challenge" to Farage, however, Persson is shooting fish in a barrel. He is addressing the man whose party represents only the minority of anti-EU opinion, and which, in the twenty-plus years of its existence, has yet to come up with a coherent exit strategy. The think-tank director can thus cherry-pick any unrepresentative option he likes, to bolster his fraudulent case for renegotiating the EU treaties – which is the real object of the exercise.

In the OE report, we are told by the Guardian, four exit scenarios are set out, all of them offering the entirely unrealistic "big-bang" options with not the least attempt to consider hybrid solutions, which involve interim solutions and staged withdrawal.

As so often when it sets out to deceive, therefore, Open Europe is characterised by what it doesn't say – what it omits rather than what it tells its readers.

The worse case, which OE wants us to consider is Britain leaving the EU customs union and the single market, and failing to strike a trade deal with the EU. This, predictably, would create havoc with the trading arrangements with the EU, so much so that no one but an idiot (and Mats Persson) would even consider it. Not even Ukip is mad enough to consider this option, yet this is precisely what Persson chooses for his "Armageddon scenario". It is this on which he relies to support his assertion that leaving the EU could cost us £56 billion a year.

Predictably, and with weary constancy, OE skirts round the Norway Option – which is mentioned by name only once in the 104-page report. No analysis of the cost to the GDP of retaining EEA membership is made, by which sleight of hand, open Europe avoids telling us that this option would be cost-neutral. 

Such pages as are devoted to EEA membership are dedicated to telling us how bad the option is, so much so that – as with the IEA "Brexit" competition - the option does not make the final list of scenarios. This is "death by omission", the option dismissed with the classic and entire misleading comment that: "Only EEA membership offers full access, but also involves accepting all the EU rules without a vote on their design or implementation".

This is now part of the current OE armoury, presenting the vote as if it was the be all and end all of the legislative process. Yet, we have been told time and time again that the politics are settled long before the vote, with EEA countries having greater influence over new legislation than the UK. This, OE steadfastly chooses to ignore.

One can only conclude from this that the Norway Option really does terrify the Europhiles, so much so that OE rushes past it, to invite its readers to consider a "mildly improved version of Switzerland's relationship with the EU". In this particular fantasy, Britain negotiates an exit from the EU, involving a free trade deal with the rest of the EU which would give the UK similar market access to the one it currently enjoys. Yet this is still supposed to cost 0.81 percent of GDP.

This then paves the way for fantasy number three, an "even better version of Switzerland's relationship with the EU" – one which, presumably, washes even whiter. In this, Britain would scrap many "EU regulations" and introduce "unilateral free trade" in which the UK would open its borders to foreign competition. Remarkably, this fantasy scenario would lead to a boost to GDP of 0.64 percent.

Now comes the fanfare for the "best case scenario". According to the mendacious Persson, Britain would secure a deal with the EU, implementing a unilateral free trade arrangement, while going for "the maximum deregulation on EU rules such as scrapping all climate change targets". This, supposedly, would increase the UK's GDP by 1.55 percent.

But just to make sure that we understand that Persson does not actually recommend this move, he inserts the sly barb, that: "In political terms this would make Margaret Thatcher look like a socialist". What he doesn't tell us is that the Climate Change Act would keep the climate change targets in place, and therefore, wipe out his GDP boost.

For the first time, however, Open Europe actually recognises the potential impact of global versus EU influence over regulation, but readers need not expect an honest exploration of the issue. There is no honest intent anywhere in this report.

OE keeps the focus tightly on financial regulation currently in force, with a view to talking down the global influence. There is nothing of G8, its relationship with the FSB, OECD and the Basel Committee, and things to come, where the trend is towards globalisation of regulation. And those expecting a references to Codex, UNECE, or the World Forum for the Harmonisation of Vehicle Regulation, will be disappointed.

Such omissions, though, go completely unnoticed by a media which is increasingly proving itself unfit to report on the EU debate. In this instance, the Guardian buys into the myth-setting, conveying the OE "belief" that its report "represents a particular challenge to Farage who will have to decide whether Britain should see a dramatic shrinking in its GDP or allow unrestricted EU migration".

The egregious straw-man, of course, is not the challenge it is intended to be. It should be, because Farage has been almost criminally negligent in failing to ensure that Ukip has a credible exit plan. But over-confidence has moved Persson and his minions to go so far over the top that all they are doing is challenging is their own credibility.

Needless to say getting their propaganda into the Guardian has proved no challenge at all, but they probably found the Telegraph even easier. This paper is steadily abandoning even a pretence of supporting the anti-EU cause, and always gives OE a warm welcome. This report proves no exception.

Here, though, the Telegraph goes the extra mile and give Simon Wolfson free rein to comment – the shopkeeper and advisory board member of Open Europe who has turned stupidity into an art form.

Without so much as a blush, he tells us that, we should brace ourselves "for a barrage of misleading economic propaganda from both sides", of the EU debate, and then goes onto to retail the OE propaganda as if it was anything other than misleading economic propaganda, bizarrely asserting that it is "a remarkably balanced document".

When it comes to the European Movement, and even the European Commission, there is a certain honesty in their approach. They deliver propaganda, but at least we know it for what it is. The slimy, underhand approach of Open Europe is all the more detestable for its pretence that it is something it isn't – an impartial commentator.

The techniques used would be entirely familiar to Goebbels, as Wolfson tells us of his "fear is that those who are fighting to leave the EU would do so in the spirit of shutting out the world rather than embracing a global prosperity".

"If these attitudes prevail then Brexit can only damage the UK economy", he says. One could be charitable and assert that only his stupidity prevents him knowing full well that one of the primary purposes of leaving the EU is to escape the grip of the claustrophobic little Europeans in order to rejoin the world trading community as a member in our own right.

But with even its cheerleader unable to argue the case for the EU honestly and directly, this Open Europe's "landmark report" marks a new low in its level of deceit. It is so bad that, even though the case made by Ukip may be dire, the OE approach even makes Farage look honest.


Richard North 24/03/2015
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 EU referendum: a descent into madness

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In the manner of a stopped clock occasionally being right, even Conservative Home has managed to make a sensible comment about the Farage call for a 2015 referendum. It reads:
If you ever feel the urge to run a failed Out campaign in an in/out referendum on Britain's membership of the EU, here’s how to do it in two easy steps.

First, make Out-ism all about immigrants and foreigners. Indelibly associate it with gripes about how many people speak English on your train to work, mutter about abolishing protection from racial discrimination in the workplace, stuff your mouth full of dog-whistles and blow until you can blow no more. 
Neglect to make a positive case for replacing the protectionist, monolithic, anti-democratic EU with an outward-looking, free-trading approach to the whole world. Provide no messages to the wavering, softly eurosceptic millions other than those which confirm the fears raised by the "in" camp's scare-mongering.
Second, having built such a poor platform, insist on an immediate EU referendum. In return for your support for a minority government, demand a vote on a time scale that provides for no campaign period beyond a couple of weeks, no time to build a big Out coalition across party lines and no opportunity for anyone to undo the damage your focus on foreigners has done to distract from the positive case for independence.

Of course, while such an approach is a recipe for failure in a referendum, it may simultaneously be a recipe for maximising support for your party among the 20 percent or so of voters whom you hope will hand you the greatest partisan advantage, and to hell with the impact on our chances of actually leaving the EU. But to make that trade, you'd have to put party before country – and that would be wrong. Wouldn't it?
What's missing, of course, is any idea that a 2015 referendum is impossible, but then you have to take what you get from CH. Better late to the feast than not at all.

However, Civitas also offers a reasoned analysis on the same theme. It is very much worth reading, pointing to the damaging effect of Farage's move. But it is a measure of how far Farage has departed from reality that, despite the absurdity of his position, he has repeated his call, telling the Telegraph: "The EU is facing an existential crisis and, given that it only takes a few weeks to launch and organise a referendum, it should be held in 2015".

For the many years that I have known Farage, I have never seen him exhibit quite this degree of detachment from the real world - "it only takes a few weeks to launch and organise a referendum". This is barking mad. No serious politician could ever say something quite so stupid – even if it takes a pretty stupid journalist actually to publish it. 

Strangely, a piece by Reuters tends to confirm this surreal detachment. The Agency records Farage's response to a question about his health, having him says, "it's fine", then adding: "I have lived a very clean lifestyle so I like to think I am reaping the dividends". As the man said, "you can't be serious".

As for the media, currently, there is currently a certain manic quality to the coverage, particularly from the Telegraph which, having puffed The Great Leader's poundshop Mein Kampf, failing to note - as did Boiling Frog - TGL's ability to produce his personal statement when his party is unable to deliver a manifesto.

Not content with this, though, the Telegraph is also sucking up the Europhilia from Open Europe. Bizarrely, it then runs an editorial that ends up telling us that Cameron is right to seek "reform" of the EU because the OE crapologists assert that the Norway "model" doesn't work. Even the term "model" rather than "Norway Option" is a distortion, designed to confuse rather than inform - again as pointed out by the redoubtable Boiling Frog.

In fact, the paper's treatment of this issue is more than bizarre - it is downright sinister. There have been two high quality studies on the "Norway Option", one from Bruges Group and the other from Civitas, yet neither were given any coverage by it, nor the media in general. Yet any amount of tat opposing the option goes straight in. It takes no imagination at all to work out that there is an agenda here.

Thus, if you want sense from the media, go elsewhere. In this instance, you could try looking to Russia Today, which relays David Cameron's views of Farage's stupidity, saying that the chances of holding a referendum in 2015 were "pretty slim". Even on this, though, Cameron is being pathetically weak. He should be slapping down the stupidity, making it absolutely clear that Farage is on his way to madness.

Perhaps this is the real story. Ukip is now dipping to 12 percent in the latest YouGov poll, on a downward trend, and Farage is a wasting asset. Yet the Conservatives are being run ragged. Cameron needs to grasp the nettle. He should stop running scared of Ukip and deliver the coup de grace.


Richard North 18/03/2015
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 EU regulation: incompetence on every side

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I have to say that I'm getting a little tired of the sheer silliness for the Open Europe children, and of their feline dishonesty – to say nothing of the gullibility of the media. And splattered over the Guardian is an example of media gullibility, with the headline, "EU exit: 'Norway option' would leave UK with 94% of current costs – thinktank", presented as if it was something new, special or even accurate.

The source is a trivial piece of work, picked over by the drooling City Am, which seeks to tell us that the Norway Option is a bad idea, because: "94 percent of the cost associated with the most burdensome EU rules would remain in place but the cost would be even harder to cut, since Norway has no formal voting powers over EU rules".

The point, of course, is that if these drivellers had actually bothered to read Flexcit (and were able to understand it), they would see that our exit plan – adopting the Norway Option as the first part – is economically neutral. The actual regulatory costs would be 100 percent of those borne under EU membership, as we remain in the EEA and repatriate the entire EU acquis.

As to the absence of formal voting on the part of Norway, we are seeing Open Europe creep away from their claim that "Britain would still be subject to EU regulations on employment and financial services but with no formal ability to shape them", and their alternative, that Britain would have "no formal political influence" over the Single Market rules. 

Nevertheless, we see OE continue to ignore regional and global regulation, and the way EFTA/EEA members have greater influence over it than EU members. And while its thoroughly dishonest stance has been fully aired on this blog, it this type of propaganda is an indication of what we are going to have to deal with in any referendum campaign.

The current effort includes OE listing the "top hundred" of supposedly the "most costly EU-derived regulations in force in the UK", in their attempt to talk up the costs of the "Norway Option". But, unless OE researchers are truly ignorant, then we really are dealing with wilful propaganda, malicious in intent, the aim being nothing else but to deceive.

Dipping into their "top hundred" list illustrates the point. For instance, we see old favourites such as the Motor Vehicles (EC Type Approval) (Amendment) Regulations 2008 implementing Directives 2007/34/EC, 2007/35/EC and 2007/37/EC, plus Regulations (EC) No 706/2007 and 715/2007, with the OE claiming that the annual recurring cost of £1.3 billion a year is wholly attributable to the EU.

Yet, as readers on this blog will already know, the directives and regulations are part of the vehicle type-approval package which implements UNECE regulations – regulations which would remain in force even if we had completely withdrawn from the EU. Furthermore, within the EEA, we would have a vote on new regulations, through the World Forum on the Harmonisation of Vehicle Regulations, in Geneva.

Then OE have listed the CRD IV package the cost again attributed to the EU. However, we find the European Banking Authority telling us that the package implements the Basel III agreement. Although OE attributes its recurring £4.6 billion cost to "EU regulation", it is attributable almost entirely to international "quasi-legislation".

Another item on the OE list is the UK Renewable Energy Strategy which, although implementing Directive 2009/28/EC, is also mandated by the Climate Change Act. Both Directive and Act are variously implementing the Kyoto and subsequent international agreements. To attribute the £4.7 billion cost to "EU regulation" is wholly misleading – the polite way of saying "a lie". OE is peddling lies.

Even where we see the genuine application of EU law, as in the Genetically Modified Food (England) Regulations 2004, and two other Regulations, to attribute the cost to the EU is also misleading. Outside the EU, we would almost certainly have identical legislation, with exactly the same costs.

I am not going to trouble you with further examples from the OE list, but the point is made that significant costs attributed to the EU do not stem from EU initiatives. We would carry them whether we were in or out of the EU, "Norway Option" notwithstanding.

But, if the OE argument is false, and repeatedly so, so too is much of the propaganda from the "other side". That criticism applies especially to Ukip, Business for Britain and many others in the anti-EU movement- all of those which, to a greater or lesser extent assert that there would be immediate savings in regulatory costs arising from leaving the EU.

The trouble is that EU regulation, and how much money we may or may not save from leaving the EU, constitute the type of "biff-bam" arguments that the media love to report. But the two sides getting bogged down in such arcane details is precisely the wholesale turn-off for the general public that we need to avoid. If we are going to make any progress, the economic issues should be neutralised and "parked", not endlessly chewed over by a bunch of hyperactive think-tank wonks and ill-briefed politicians.

What we are seeing, therefore, is incompetent campaigning from both sides – although the need to overcome the status quo effect imposes greater demands on the "out" campaign. Equal incompetence means we lose. Either way, though, the anti-EU movement is being poorly served. And if we can't even trash the OE nonsense, we deserve everything we get.


Richard North 17/03/2015
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 EU exit: the other side is even worse

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While Farage is dragging the Ukip agenda further and further away from the task of leaving the EU, the exit debate continues without him, and with a remarkable intensity, leaving the ostensibly anti-EU party entirely without a voice on the issue.

Latest into the lists is Mark Leonard's European Council on Foreign Relations (ECFR), with a paper on the "British problem" and an analysis so trite that we are able to take some comfort from it. However bad our lot might be, Mr Leonard and his friends are even worse in their understanding of the issues.

Leonard is one of those "pro-Europeans" who insists on calling members of the anti-EU movement "Europhobes" – mildly irritating but harmless, and a usage that actually demeans him, revealing him as the petty-minded individual that he really is.

Actually, to call his analysis "trite" is something of a compliment. He tells us that the "risk of Brexit" is not driven by a Eurosceptic public but by a "Europhobic elite" that has conflated immigration with Europe and then, totally off-beam, argues that "Britain's Europhobes have a powerful intellectual framework", as well as "wealthy backers, and advocates in the media, the House of Commons, and even the Cabinet".

Would indeed that there was a "powerful intellectual framework", especially when Mr Leonard asserts, in his report, the single reference to intellectualism is in a reference to "the biggest triumph of UKIP". This, he asserts, has been to fuse the European issue with migration – arguing that the EU has taken away domestic control of Britain's borders.

In an interview last year, we are told, Farage conceded that he struggled for years to work out how to make Euroscepticism a popular cause before he got hold of immigration as the way to make it connect: "These things did seem to be rather intellectual debates rather than things that were affecting everyday lives", he said.

In other words, Mr Leonard is saying that it was not until Farage broke away from the "rather intellectual debates" that he managed to make "euroscepticism" work for him. The great pro-European thus contradicts his own thesis. If Ukip is "eurosceptic", it is also anti-intellectual.

Cutting through the blether, however, there is one section which could help us in our work on devising a suitable exit plan – something the anti-intellectual Ukip has still not got round to doing.

Under the sub-heading, "Brexit fallout and contagion" we learn that, around the EU, there is "a widespread fear" of four elements. Of these, one is that "Europe" without Britain would be "smaller and poorer". The EU would miss the practical application of a well-oiled government machine that has helped drive forward European integration, and leaving the EU would have an "immediate impact on the UK's immediate neighbours" – such as Ireland.

What I find particularly interesting, though, is the first of the elements identified, which is given a lengthy treatment. In this, there is concern about "the chaos unleashed by a Brexit", and in particular, "the thousands of hours that would need to go into re-writing laws and negotiating new terms". "Untying the links between the UK and its closest partners", Leonard adds: "would consume a huge amount of political and bureaucratic energy".

Here, it is just as well that the "great pro-European" hasn't read Flexcit (not that, on current form, he'd understand it), for it keeps him in ignorance of the answer to that problem, which has us adopting the Norway Option, and repatriating the EU acquis – as an interim option – which minimises the administrative burden.

This brings to mind the crucial issue of "absorption capacity", which I deal with in Flexit - a measure of the ability of a system to absorb change.

Obviously, Leonard would be right if, as he believes will happen, the UK looks for a de novo free trade agreement with the EU, then the burden will be huge. But if, for the time being, we adopt our "off-the-shelf" solution, the amount of effort required is minimised.

It is encouraging, therefore, that we already have answers to the concerns that could well be voiced in any EU referendum, even if – as Boiling Frog points out, the "out" side is less than unified in coming together to adopt a winning strategy to leave.

That came from Mr Frog after a lunch with White Wednesday, who then offered this comment to our previous post:
My frustration [on this] … can easily come over as "why can't we all just be friends?" i.e., the big tent stuff you refer to. But it is only a big tent in the sense of a meeting point to debate and challenge. I'm not one for some woolly consensus that fails to satisfy anyone. The anti-EU movement doesn't so much look like a spectrum of views but a line of islands separated by shark-infested waters ... move to the consensus space in between and you get eaten alive.
At least now, though, we can take it that the pro-EU lobby is unaware of our [necessary] disunity, and that we already have answers to most of their major concerns.

In conclusion, it is worth noting that one of Leonard's concerns is that, with the UK leaving, the diminution of the existing EU would have a corrosive effect on international perceptions of the EU. After the "no" vote on the Constitutional treaty the EU went from seeming like a rising power to a failing project, and this would reinforce that perception.

However, this comes just as Iceland has formally decided to drop its application to join the EU – thus deciding to keep within the terms of the EEA and to cooperate with the EU as it has done previously.

What's good enough for Iceland – from which we can learn a great deal, and where Flexcit has been avidly read - is more than good enough for the UK. The EU need only be seen as a "failing project" if it lacks the capability to adjust to the new reality, where cooperation rather than political union becomes the watchword.


Richard North 13/03/2015
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 EU exit: all at sea with the think tanks

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There must be something in the water down in London town, affecting how people think, and certainly the performance of those organisations which – with increasingly less justification – call themselves "think tanks".

One of our more recent targets was Lee Rotherham's Civitas paper, and while I can "see where he is coming from" – in management-speak parlance - I fundamentally disagree with his strategy of testing renegotiation to destruction before we unleash EU withdrawal on the unsuspecting public.

This hasn't prevented us conducting a robust but friendly exchange, culminating in an lively argument in the Red Lion yesterday, where we ended up agreeing to disagree. I still think he is wrong, but I respect his reasons for promoting what I feel to be a flawed approach.

At least in this case, though, we have a paper which sparked debate – which is supposed to be the purpose of treatises published by think tanks. The point of publication is to try out ideas and argue them through, allowing them to fall by the wayside if they don't survive the scrutiny.

One can be forgiven for assuming, however, that that view is dropping out of favour. One gets the impression that the London think-tanks are on broadcast-only mode. Any conversation between them is private and us serfs in the provinces are supposed to genuflect before their greater wisdom and imbibe uncritically all they deign to hand down to us.

Certainly, despite some shoddy and very questionable work, the bulk of the think-tanks get an easy ride from the (London-based) media, being given a free pass to publicise their wares, with never a hint of criticism or even critical analysis.

Into that category falls much of the work from Business from Britain. There is nothing personal in our criticism of the think-tanks publications. Simply, we take the view that it does no-one any favours if we allow to go unchallenged work of questionable quality. We ourselves have to be our own most severe critics, because if we can't support our ideas in the rough-and-tumble of public debate, they are not going to survive the test of time.

Holding very similar views as BfB, but very much on the dark side, is Open Europe, which we have seen don false colours, allowing many to think it is a "eurosceptic" organisation, while assiduously promoting a pro-EU line.

This, not so very long ago, brought Witterings from Witney. Boiling Frog and Autonomous Mind into the fray, attempting to counter the poisonous disinformation of Mats Persson over the Norway Option, which continues to this day.

Yesterday brought us into the fray once more to deal with Open Europe with its quite blatant propaganda on the effect of leaving the EU on the financial services industry. Its form of propaganda is all the more dangerous, as it purports to offer a balanced view, attempting to lead the unwary into believing its claims that it is a non-partisan organisation.

Then, the latest recruit to the hall of shame is a frequent visitor to that location, our very own IEA which has just published a report addressing the "EU jobs myth".

On the face of it, any attempt to debunk that most egregious of myths – even to this day perpetrated by Gordon Brown - should be welcome. And, for the uncritical media (or the tiny fraction that could be bothered with this report), the effort is entirely sufficient.

It is also the case that our opposition is less bright than it would like to think, and does not engage seriously in debate – relying mostly on constantly repeated FUD. Against such lacklustre opposition, the IEA has done the necessary, but that is rather like applauding the England cricket team for winning the test series against Merthyr Tydfil primary school (second eleven).

For a more discerning audience, however, the effort, coming from the IEA's Head of Public Policy, Ryan Bourne, is less creditable. Not least, Complete Bastard rips it apart with consummate ease.

The point Bastard makes is that EU withdrawal (I hate the word "Brexit") must not be seen as a leap in the dark. We, the anti-EU movement must be able to offer a smooth, trouble-free transition from EU member to independent nation, otherwise too many people will take fright and we risk losing the referendum.

Yet Bourne does anything but that, far too easily conceding that there could be considerable disruption before the market settles down, and any lost employment is recovered.

This is simply something we cannot afford to concede but, in the hands of the IEA, it becomes necessary because, with almost endearing stubbornness, the Institute refuses to accept the validity of the "Norway Option", having rejected it on entirely doctrinaire grounds in its chaotic, dishonest "Brexit" competition.

This puts the IEA on the wrong side of the tracks, capable of doing more harm to the anti-EU cause than some of the more inept pro-EU organisations, which at least are obviously and openly on the other side.

Unfortunately, the anti-EU movement has to confront no end of these fair-weather friends. It cannot allow false nostrum to prevail, polluting campaign messages, which means that their authors must be disowned, and their errors rigorously exposed.

Nevertheless, some would have it that we should take a more emollient "big tent" approach, and accept a compromise view that keeps the anti-EU movement united. Advocates of this approach, however, need to consider whether their objective is to unify the campaigners, or to win a referendum. The dilution of the message may secure the former, but at risk of losing the bigger battle.

Successful campaigns, on the other hand, tend to be uncompromising, projecting a consistent, coherent message, with conviction and clarity. Small numbers often succeed with this, when larger numbers fail, and when they realise that they are there to win battles, not make friends.

Thus, it seems to me that we cannot give a free pass to the faint hearts and woolly minds of the London think-tank circuit. Their work, no more than anyone else's, should be immune from criticism and debate, even if they want to cast themselves as above the fray.


Richard North 12/03/2015
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 EU politics: false flags galore

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It was actually in 2006 that we were pointing out that Open Europe wasn't a eurosceptic organisation. How could it be with a "mission statement" almost identical in tone to the robustly Europhile organisation Business for New Europe. And by 2012, we were openly calling it the "enemy within", so obvious were its pro-EU sympathies.

That, however, did not stop the media routinely labelling it a "eurosceptic think-tank", and continuing to do so almost to this day. Amongst their number, as you would expect, was Conservative Home, helpfully reinforced by the European Commission which in 2009, according to Mary Ellen Synon, declared Open Europe "a eurosceptic think-tank to the right of the conservatives in the UK".

Reuters routinely called it "a eurosceptic think-tank", the Economist in 2010 backed up the Commission, calling it "a small but assiduous Eurosceptic campaign group", and the Guardian in June 2012 also helped the lie on its way. It told us that: "Britain should stay in EU, says report by Eurosceptic think tank".

A month later, the Financial Times chose a variation on the theme, referring to OE as a "broadly eurosceptic think tank", even though the think tank had "acknowledged recently that EU membership remained the most beneficial arrangement". And, of course, the BBC was to the fore, observed as late as June 2014, referring to the "influential Eurosceptic think tank Open Europe".

Even the supposedly eurosceptic Spectator went along with the myth in November 2012. And predictably, The Times fell into the trap, calling Open Europe a "Eurosceptic think-tank” in October 2013. Sadly, the Telegraph was no better. It used the term "Open Europe, a Eurosceptic think tank" in November last year, as indeed did the Express and the Daily Mail.

But one other media outlet that was giving Open Europe the "eurosceptic" accolade was EurActive. It was keeping up the charade into 2013 but, by December of that year, OE had become "the Euro-critical think tank Open Europe". Then, as of yesterday, it has been fully outed to become "a critical but pro-EU think tank" (see illustration).

This is a major step. After all these years, the truth it out and, as a false flag operation, Open Europe is no more. However, a replacement is already in place, in the form of Business for Britain - or Business for Elliott as one critic calls it, after its founder and major beneficiary, Matthew Elliott. He is the man who started Taxpayers Alliance - ostensibly an independent organisation but in fact a Tory front to broaden the attack on Labour's public expenditure agenda.

Elliott's latest cash cow has stepped into the breach with a "renegotiation" agenda identical in principle to that of OE. And it has already spawned the first of a number of Münzenberg-esq "front organisations", the equivalent of the "Innocents' Clubs", stacked with "useful idiots", used to bolster Soviet Russia.

This "clone" of BfE, Historians for Britain, is to be followed by others, all adopting the same basic pattern, launched on the back of a list of prominent signatories willing to perform the "useful idiot" function to a gullible media. In due course, we can expect the likes of "Nurses for Britain" and even "Roadsweepers for Britain", the aim being to swamp the anti-EU movement with "false flag" operations and to suppress the established "outers".

With the media corporations inherently sympathetic to "renegotiation", and the average journalist apparently unable to tell the difference between a WWII tank and a mid-sixties self-propelled gun, they are hardly going to bother outing these sham anti-EU organisations, any more than they did Open Europe. More likely, they will suck up the highly polished propaganda that Elliott can provide them, as a cheap substitute for real journalism. 

Willi Münzenberg would have been so proud to see his work so deftly exploited. Maintaining plausible "front organisations" is a demanding process and the pro-EU faction has made the most of his pioneering work.  


Richard North 28/02/2015
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 Ukraine: needless provocation?

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I am not sure what to make of the apparent bravado of Nato forces, including a small detachment of US Second Cavalry Strykers (pictured), joining an Independence Day parade in the Estonian city of Narva, a mere 300 yards from the Russian frontier.

The city juts into Russia, separated only by a river, and has a large Russian-speaking population. It has often been cited as a potential target for the Kremlin if it wanted to escalate its conflict with the West onto Nato territory. Thus, the Washington Post calls the parade a symbolic act that highlighted the stakes for both sides amid the worst tensions between the West and Russia since the Cold War.

Symbolic it may be, but it is also provocation - not least to the Russian-speaking population of Estonia. Despite that, though, it hardly seems that Russia can complain. It has upped the frequency of probing flights by Bear maritime patrol aircraft, close to UK airspace, and is worrying the Norwegians in the high Arctic with extensive air movements.

On the other hand, in a bid to calm things down, Merkel has rejected calls to arm Ukraine, and is even refusing weapons to the Baltic states. It seems particularly inappropriate, therefore, that the UK should be sending troops on a training mission to Ukraine. This is hardly calculated to calm Russian suspicions and lends strength to the Norwegians who are asserting that "relations with Russia will never again be the same". They are talking about restructuring their military.

The UK military lobby is doubtless delighted, as this new threat – real or apparent – justifies greater defence spending. Rory Stewart, current Defence Committee chairman, is already putting in a bid for more money. In fact, such is the enthusiasm for upping the ante that a cynic might even suggest that the UK defence industry had done a deal with Russians, their respective establishments looking forward to a boost in conventional arms spending, the like of which neither have seen since the end of the Cold War.

Nevertheless, the Nato establishment may be taking on more than it bargained for. Last week saw the release by the Russians of details of a new armoured vehicle, the first completely new platform for over 40 years, carrying the name Armata.

Developed by the Uralvagonzavod Research and Production Corporation, the tank version (T-14) sports an unmanned remotely controlled turret, armed with a brand new 125 mm 2A82-1M smoothbore gun. Its muzzle energy is greater than one of the world's previously considered best tank guns: the German Leopard-2 Rheinmetall 120mm. 

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Significantly, it is also equipped with a 30mm cannon capable of dealing with various targets, including low-flying helicopters, together with a 12.5 mm rotary machine gun, reportedly capable of taking out incoming projectiles, such as anti-tank missiles and even anti-tank shells at speeds approaching 3,000 meters per second. Presumably, it is equipped with sensors similar to those used in the Israeli Trophy system.

The Russians have already delivered 20 units for training purposes, but this is territory into which we do not want to venture. The UK is reliant on 20-year-old Challenger 2 tanks and the very last thing we need is an expensive re-equipment programme. Matching Russian capabilities could cost us billions.

With the UK standing accused of "sleep-walking" into the current crisis, and having been "taken by surprise by events in Ukraine", one wonders if Mr Cameron has really thought through his current "provocation". We really cannot afford another arms race, and decades of Cold War with Russia, yet our prime minister seems determined to lead us down that path, without the first idea of the consequences.


Richard North 26/02/2015
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 Globalisation: a conspiracy of silence?

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At the beginning of the month, we saw a report from the House of Lords EU Economic and Financial Affairs Sub-Committee, which delivered views on "the post-crisis EU financial regulatory framework".

This Committee thought that efforts by Europe to strengthen banking rules to avoid a repeat of the 2007-09 financial crisis were "admirable" but it also criticised the cost of the impact of the new laws and noted other flaws, saying Britain needed to retain direct involvement in decisions that affected one of its most important economic sectors.

Most significant of all, though, was the evidence offered by Professor Simon Gleeson who told us that, of the 40 different items of legislation produced by the EU in response to the crisis, with the exception of one and the partial exception of another, all were already being implemented in the UK.

Had Europe not existed, he continued, every single one of those directives would have been implemented here for exactly the same reasons that they were implemented at the European level, because they were part of a globally considered response to the crisis.

In the context, the primary drivers of financial legislation are the G20 and its operational arm, the Financial Stability Board (FSB), the OECD and, crucially, the Basel Committee on Banking Supervision.

Cut then to Ruth Lea in today's Times who concedes that much of the Brussels-originated financial regulation after the financial crisis would have been implemented even if Britain had not been an EU member. But, she implies, outside the EU, they can be repealed and/or amendment as circumstances change. Within the EU, she says, this is "all but impossible".

This is a line she also sought to convey in her speech on EU alternatives last week, one shared by a number of the speakers there who offered the vision of a regulation-free nation once we had left the EU – something, they asserted, that was entirely impossible while we remained in the EU.

Totally ignored, therefore, were the effects of globalisation and the fact that much of the rule-making that forms the EU acquis is initiated at global level. As a result, also ignored is the fact that – for a huge tranche of regulation covering a wide range of sectors, from financial services to automotive production and agriculture – leaving the EU would make very little difference. Most regulation would still apply.

The upside of this is that, outside the EU, we would be able to take a very much greater part in framing the regulation and, like Norway, would be in the interesting position of taking part in the process of developing regulation which would be adopted by the EU and then handed down to EEA members, including Norway.

To my mind, this is a better position than the simplistic view offered by Ruth Lea and her follow travellers, whose vision of a regulation-free nation is, to say the very least, unrealistic. In the absence of much of the current international/EU law, we would have to frame laws to replace it. Then, since we are global traders, much of that law would have to be harmonised with global laws, putting us right back where we started.

What seems to me to be happening, though, is that the "regulation-free" advocates are so wedded to their narrative that they are ignoring – or even denying – the effects of globalisation, and the fact that we would obtain little relief from trading regulation on leaving the EU.

However, in so doing, they are ignoring one of the most powerful arguments we have for leaving the EU – that rejoining the global regulatory community gives us more power and influence than we currently enjoy as members of the EU.

From there, we can then begin to understand why this same caucus is so opposed to the "Norway Option". But that creates a bizarre situation where they have common cause with the Europhiles who also oppose it, although for different reasons – precisely because it increases our power and influence, while giving us access to the Single Market.

Sadly, that puts us at odd not only with Europhile sentiment, but also with the eurosceptic "regulation-free" advocates. Yet, so strong is the globalisation argument that we cannot walk away from it, just for the sake of a false unity which would have the overall effect of weakening our case.

This then presents a further conundrum, as the "regulation-free" advocates are effectively bolstering the Europhiles, with the potential to weaken any coming EU referendum campaign. Effectively, even if unwittingly, they have joined the enemy ranks.

Quite how we then handle this, I am not yet sure, but the one thing we have to take into account is the importance of offering the uncommitted a credible exit plan. This, I suspect, may outweigh the effects of a false unity, in which case we have fewer allies in our cause than eve we imagined.


Richard North 24/02/2015
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 EU exit: irrational fear of the Norway Option

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Latest in the long (and tedious) line of naysayer to warn Britain "of serious consequences for economic and security policy if it leaves the European Union" is Vidar Helgesen, Norway's minister for Europe.

He has been given a platform by the Observer , taking the opportunity also to tell us that his country has often found it difficult to shape economic rules that affected Norway – often cited by Eurosceptics as a shining example of how a nation can thrive outside the EU – while not being a member.

This is a sideways dig at the "Norway Option", but it must say something for this option that the Europhile tendency that it is so keen to discourage its adoption, taking virtually every opportunity to spread the message of how bad they think it is.

Not content with the usual frighteners, though, Helgesen adds a reference to a time of "burning security crisis not seen since the cold war". Most key meetings, he claims, are now being convened at EU level, rather than within Nato, and it was vital that the UK was there to shape decisions.

The man is on his way to talk to the pro-EU campaigning group, British Influence, with a speech entitled: "The European Union: why one who has not joined thinks that WE should not leave".

Largely as a result of its oil resources, Norway is one of the wealthiest countries in Europe, with a higher per-capita income than the vast majority of its member states.

As a result, we are told, "British Eurosceptics" often say the Norwegian experience is evidence of how a country outside the EU, but enjoying the benefits of the single market through membership of the EEA, can prosper without having to commit itself to full membership.

This, however, is classic straw-man territory. But then, the only way the Europhiles can win an argument is to distort it first, beyond all recognition.

In Flexcit, we recognise that the Norway Option is an imperfect instrument, advocating it only as a halfway house – a ready-made template to ease our way out of the European Union. This is but stage one of a three-part process, with the benefits of withdrawal accruing mainly in the third stage.

Such is the narrowness of his vision, though, that Helgesen complains EEA membership often creating "frustrations and difficulties", which means that "Norwegian ministers and officials spent a lot of time – sometimes without success – trying to find out what was going on in EU meetings that would affect their country directly".

"We [Norway] are fully integrated into the EU single market as members of the EEA", he says, "but what we don't have is the right to vote on those regulations that are incorporated into our law when they are made by the council of ministers".

But with qualified majority voting applying to the Council of Ministers, and Britain holding 29 out of the 352 votes, it can cast only eight percent of the vote. Yet, a qualified majority is 252 votes - 73.9 percent.

In the European Parliament, the situation is little better. There are 73 UK MEPs, and these represent a mere 9.7 percent of the 751 elected MEPs. Given the party splits, this level of representation is notional. UK MEPs rarely vote together as a single bloc. Even if they did, they could never muster the 376 votes needed for a majority.

Thus, the idea that Norway is gravely disadvantaged by not having a vote is sheer fantasy. Any relationship with the EU – in or out – is going to be fraught.

It is, therefore, of little consequence that Helgesen reports that, on occasion, Brussels has sprung surprises that the Norwegians could not predict. The same kind of frustrations, he says, could well face the UK – as if they do not already, and continuously so.

Here, what is so fascinating about these Europhiles is how little they know of the construct they so adore – much less of the way the world works, and the Norwegian part in it.

Referring to our membership of the Union, he says: "You would not have all those Brits staffing the commission where the decisions are made", then adding: "Britain being on the outside would obviously not have that amount of people on the inside. You would find it more difficult, as a result, to affect the regulations".

That, of course, is not how regulations are affected, and this is not even how the game is played – as the Norwegians themselves well know, with their role in Codex standing as a major example of how regulation is framed.

It takes Anne Tvinnereim, former Norwegian State Secretary – whom we interviewed when we went to Norway – to present the honest position. "We do get to influence the position", she told us. "Most of the politics is done long before it [a new law] gets to the voting stage".

Nevertheless, Helgesen says: "It is up to the British to make the decision [as to whether they leave the EU], but I would not think that if the Norwegian model were applied, that this would be ideal". This, though, is nothing more than a statement of the obvious. There is no such thing as an "ideal" in practical politics – only sensible compromises that take us towards a desired goal.

And clearly, such rationality is beyond Peter Wilding, British Influence's director, to whom Helgesen is coming to talk. "Eurosceptics who peddle the myth that Norway is the best [model] for a non-EU Britain are deceiving the British public", Wilding says. "They say leaving leads to more democracy and security. This is nonsense".

So yet again a Europhile resorts to the straw man argument. Nowhere in Flexcit and nowhere generally do we see it argued that the Norway Option, per se leads either to more democracy or security. That is not the point. It is merely a means to an end.

Before we leave it there, however, we have to observe that the other side of the Norwegian divide is suffering from the same misconceptions.

This we see with Heming Olaussen, former director of the Norwegian "No Campaign", who – as the recent Bannerman fest - also warns us against the EEA option (as do most of the other participants).

When, however, these people have the depth of knowledge that we have acquired, though dint of solid hard work, they might be worth listening to. As it stands, it is remarkable how so many can stand up to parade their ignorance, and still believe they have anything to offer.

What tells us more than anything, though – far more than their words – is the frequency and intensity with which so many parties seek to condemn the "Norway Option", alongside their determination to ignore Flexcit. This tells us that we are on the right track. It wouldn't scare them so much if we weren't.


Richard North 23/02/2015
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 EU Referendum: back where they started

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David Cameron, we are told, has downplayed the chance of an early referendum on Britain's membership of the European Union and said he needs time to renegotiate the best deal.

The Prime Minister says that calling a snap vote on membership risked forcing the electorate to choose between two "unappetising" options. A "better choice" would be to hold a vote by the end of 2017 after having had a chance to convince other allies to reform the EU and give the UK more freedoms.

And so, ten days after the Sunday Times set the hare running, and the Express made a fool of itself, we are back where we started, with 2017 remaining the preferred date for a referendum.

Getting back to where we started has very much been the theme for the week, with the IEA l;ast Monday rehearsing the same old block of exit options that have been floating around for decades. More an exercise in nostalgia than forward thinking, the Institute even dredged back into its own archives to resuscitate a 14-year-old-idea that didn't even have much going for it when it first appeared.

All this was in the pretence of promoting debate on "the best way" of leaving the EU, and so unsuccessful has been this endeavour been that, after killing debate stone dead after its abortive competition last year, the best the IEA was able to manage was an article in the Telegraph telling us that there are four paths that the UK can take out of the EU … and they're all bad.

Along with the IEA in its original Brexit competition, Telegraph writer Ben Wright simply cannot grasp the idea that leaving the EU cannot be a single event. It must be a multi-stage process, probably unrolled over a several decades, on the premise that undoing forty years of economic and political integration cannot be achieved with any speed.

This was what the idea that the IEA peremptorily rejected last year, although it is now published online as the Flexcit plan, offering far more than the totality of the IEA offering. Yet one of the IEA authors - who hadn't troubled himself to make a submission to the original competition, had the nerve to tell us that, "the debate has been far too myopic".

For "myopia", though, we have to turn to Campbell Bannerman's continued efforts to sell his aptly-named "EEA-lite" option, so lightweight that it almost completely lacks substance. The only forward-looking glimpse allowed during a seminar held in Europe House yesterday was a video recording from Owen Paterson telling us that a "spectacular future" awaits us outside the EU.

This moved the Express to remark that: "Convincing those who are undecided that Britain would be better off out of the EU is a vital way of strengthening the campaign for an exit". The paper adds: "Articulating a positive vision of a free Britain is central to achieving that", even if this is the paper – like so many – which has made no effort whatsoever to break out into the sunlit uplands and articulate such a vision.

At least this week we've seen some solid work from the Democracy Movement, in association with Global Britain, debunking the "three million jobs" meme. This is the unglamorous end of the campaign, doing work that must be done if we are to build a solid case for exit.

That is all the more necessary with Hannan, completely misreading Mr Cameron's "renegotiation" strategy, so much so that Peter Wilding, of British Influence, believes that in any referendum the case for staying in would "triumph". If it was left to the likes of Hannan, Wilding is not wrong. It would be a walkover.

Nevertheless, with Civitas also having produced its new paper on the Norway option, and the new edition of Flexcit having been published, it has been a busy time on the eurosceptic front. The only absentee from the debate, it seems, has been Ukip.

This is perhaps just as well, as it does look as if that referendum is getting closer. Rafael Behr in the Guardian notes that here is palpable confidence in the Tory party that David Cameron will still be prime minister after the general election. It flows, he says, not from any surge in public enthusiasm for the idea of Conservative government, but from a lack of evidence that voters are ready to trust Ed Miliband with power.

The subsequent referendum, Behr believes, will be a nightmare for Britain. But it will be a bigger nightmare for us if we lose. Yet, the bulk of the activity we have seen this week has brought us no closer to victory. Happily, though, not everything is on the media map. While most are back where they started, some of us crossed the start line - of which more will be revealed in good time.


Richard North 19/02/2015
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 EU referendum: a confusion of campaigns

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In last night night's post, I highlighted an article from the Daily Telegraph which asserted that David Cameron's "planned timetable" for renegotiating EU treaties had been "torpedoed" by Commission President Jean-Claude Juncker.

This was on the basis of his scrapping an "analytical note" on "stronger economic policy coordination, convergence and solidarity", where Downing Street had hoped that the paper would "put treaty change firmly on the political agenda", thereby opening the way for Mr Cameron to push his "reform" agenda.

Far from being "scrapped", however, it appears that this "analytical note" has been seen by the Financial Times which, after all that, tells us that Mr Juncker has indeed "raised eurozone integration proposals". Furthermore, his note is being taken as "the first signal" that he "intends to press for further consolidation within the eurozone" – treaty change by any other name.

That the FT managed to track down the document, though, is no great feat - the Commission has helpfully posted it on its website. And it is there that we see the Commission talking about the short term (within the next 18 months), and then of developing "a long-term perspective" on "how the framework of EMU should develop".

The "framework of EMU" is, of course, EU-speak for treaty change, thus completely trashing the Telegraph story, possibly explaining why no other newspaper has followed up on what might otherwise have been regarded as a hot tip.

Nothing of this rules out the possibility of a separate "simplified procedure" treaty on Part III issues – or says it will happen - but it does confirm that which we have been asserting for some time. There is no possibility of Mr Cameron being able to hijack treaty negotiations on the eurozone to get his way. Essentially, if he is to come up with a treaty change, it is Article 48 "simplified procedure" or nothing.

As to the timing, we see a candid report from CER which draws attention to the average of 19 months it takes for the European Parliament and the Council of Ministers to reach consensus on a piece of EU legislation. This gives something of a datum by which we can measure the time 28 Member States will need to negotiate and agree a new treaty – even under the simplified procedure. Thus, the idea of Mr Cameron being able to bring home the bacon in time for a 2016 referendum remains absurd.

Outside in the real world, though, we see pressure building up on the immigration front, with tension building in Hungary, while deaths mount in the Mediterranean, putting pressure on Italy and other receivers.

Although there are distinct areas of law covering freedom of movement for workers, and asylum seekers, the issues tend to become intertwined in the media, and as the migration season picks up, there will be more and more Member States looking for a political gesture to reassure their voters that measures are being taken to control the flow of migrants.

Mr Cameron, therefore, stands a chance of being able to manipulate political opinion, enough to surprise us all and bring home a usable treaty. And that will leave us with the problem of how to fight a referendum campaign where the existing "reformists" - and Ukip – have been sidelined by attention-grabbing promises to bring immigration under control.

Should the Conservatives succeed at the general election, therefore, we may have to be prepared to fight on grounds which are not of our choosing, also having to cut through some of the groups that already think they "own" the campaign and who are seeking to control the debate.

Already we are seeing this with the "Norway Option" issue, where the media have all but ignored the Lindsell Paper, as indeed they ignored my Bruges Group paper when it came out.

Interestingly, a day before the Lindsell Paper, British Influence published a paper by the Senior European Experts (SEE) group and Regent’s University (financed by the EU), on the Norway Option, purporting to analyse eurosceptic claims, but in fact ignoring them, trotting out much the same arguments they were using in 2011.

In their supposed (and extremely brief) analysis, they refer to euroscpetic support for the option, but only to a 2011 Bruges Group paper – not nearly as comprehensive as mine. However, if you Google "Norway Option", it brings up my 2013 paper at the head of the search results. There is no way these people could not know of its existence, so the absence of any reference has to be deliberate.

Bizarrely, though, those supposedly on our "side" are doing the same thing. We have, for instance, Allister Heath in the Telegraph blithely declaring that eurosceptics must "focus" on explaining how the City can to "continue to sell financial services to Europe and car makers to export their wares to the continent".  "They need", says Heath, "to make their case, and fast". Yet this is precisely the case we have been making in Flexcit which he studiously and quite deliberately ignores.

The same goes for Matthew Elliott. As he and his Business for Britain rehearse a twenty-year-old narrative about over-regulation in the Finanical Times, we get the Institute of Directors noting that "many EU rules are global in nature and that … British business would have to continue to comply after it left the bloc". The Institute adds that, since EU legislation is transposed into UK law, there would be no overnight change to what many regard as its regulatory straitjacket. 

These are issues also rehearsed in Flexcit but EU Referendum is not invited to the debate, and nor are many others. Longstanding eurosceptic groups complain privately that they are being excluded from the debate, while the prima donnas regard it as their private fiefdom, with the complicity of the media which is muddying the waters with inaccurate and distorted reporting. 

Those players seem to believe that "owning" the campaign is far more important than winning it, putting us at grave risk of losing.


Richard North 14/02/2015
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 Civitas: The Norwegian Way

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Norway is not in the European Union, Jonathan Lindsell writes. Instead it is part of a wider group, the European Economic Area (EEA), which permits it free trade with EU countries but allows it to avoid the Common Agricultural Policy, control its own fisheries, and pay a much smaller membership fee. Unlike EU members, it can negotiate its own free trade agreements with countries around the world, with its own priorities.

Eurosceptics, however, tend to dismiss Norway as a model for Britain to replicate if it leaves the EU. In 2013, while announcing his strategy to renegotiate Britain’s EU membership and then put the result to a referendum, David Cameron dismissed Norway: "[W]hile Norway is part of the single market – and pays for the principle – it has no say at all in setting its rules: it just has to implement its directives".

My research for Civitas, looking at Norwegian state publications and research from some of its parties, undermines this contention. Norway does not have formal votes in the European Parliament or Council, that much is true. However it does have a veto – something full members lack on many topics. It has exercised this power, and Brussels seems to respect it.

Oslo can also push for adaptations and exemptions from harmful clauses in EU law, and can contest the details of implications through a separate court. Only directives and regulations that apply to the "single market" are implemented in Norway – others can be rejected. Representing itself at global bodies like the World Trade Organisation, it can help set the regulatory agenda before the EU even considers some laws.

All of that said, pro-Brussels governments in Oslo have often been quick to comply with EU regulation, and have not tested the veto fully. Christopher Howarth shows that, while arguments could be made that Norway adopts anywhere from 9-75 percent of EU law, it's certainly true that they adopt less.

The EEA arrangement allows Norway to win its own trade deals, rather than having to follow the EU’s cumbersome priorities, as Britain does. Critics suggest that small countries outside continental economic blocs do not have the importance to win substantial tariff reductions, but this is highly suspect. Both Iceland and Switzerland have the same trade outlook as Norway, and they have each concluded landmark free trade deals with China – a larger market than any country with which Brussels has partnered.

The Norwegian option is also criticised for including EU free movement rules – for immigration. In fact, the EEA's rules include provisions for suspending free movement in social or economic emergencies. Norway hasn't used these, instead focusing on integration and language help, but Iceland exercised the same powers to stop capital flight during the recession and the EU respected the action.

Opting for the Norwegian model presents a way to leave the European Union while retaining many of the benefits, and keeping substantial influence. Britain is a much larger economy than Norway, and it is reasonable to expect Westminster’s diplomatic clout would be considerably larger, even after leaving.

Lindsell's full study, "The Norwegian Way: A case study for Britain's future relationship with the EU" can be accessed HERE. It's well worth the read.


Richard North 13/02/2015
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 Asylum: irony, inertia and hypocrisy

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Completely unreported in the British media (and almost everywhere else) is an longstanding confrontation between the governments of Afghanistan and Norway over the expulsion of Afghan asylum seekers (including women and unaccompanied children).

Not only has Afghanistan warned Norway that forcibly returning expulsion of the Afghan refugees will have serious consequences on bilateral relations and cooperation between the two nations, it is also saying that it is no longer prepared to accept forced returns.

A statement from the Afghani Ministry of Foreign affairs further adds "that Afghanistan is a dangerous place to be, the country has huge economic problems, and there is a lack of shelter, jobs and education". The Afghan authorities thus insisted that the return of the Afghan refugees must be voluntary, referring to an agreement between the two nations on repatriation.

This is entirely confirmed by the Norwegian language newspaper Bergens Tildende, which has a copy of the Afghan statement and a full account of the protest, complete with an update from today.

However, no one with any understanding of the wider issues could fail to be struck by the irony of the Norwegian action, in seeking to reduce the large number Afghan refugees who have migrated to Norway and sought to set up home there.

Specifically, it was the Norwegian government back in August 2001 which took such an active part in trying to get the Australian government to accept 438 Afghan refugees who had been picked up by the Norwegian cargo ship, the MV Tampa off Christmas Island to the north-west of the Australian coast.

The Master of the Tampa, Captain Arne Rinnan, had been responding to an emergency message from the Rescue Co-ordination Centre Australia, and had been guided by an Australian Customs aircraft to the 20 metre wooden fishing boat, the Palapa 1, which was carrying the refugees.

But, much to his consternation, when he sought to offload his human cargo on the Australian-owned Christmas Island, the Australian authorities refused him permission to enter Australian waters.

When, after declaring a state of emergency, he defied his instructions, the Australians landed an armed SAS team on board, which sought to force him to leave, the government insisting that no asylum seeker on board the Tampa would set foot on Australian soil.

The ensuring crisis was finally resolved through the intervention of the Australian High Court, and the assistance of Papua New Guinea, and then the island nation of Nauru and New Zealand, with the participation of the Norwegian government, which had lobbied the Australians to allow the Afghans to disembark and be processed as refugees.

The whole affair raised serious questions as to the interpretation and adequacy of international law, many of which remain unresolved. But the one thing the so-called "Tampa affair" did do was trigger the adoption of a new Australian strategy for dealing with what were known as Irregular Maritime Arrivals. This became the "Pacific Solution", defined by then Prime Minister John Howard in terms of him "asserting the right of this country to decide who comes here".

The overt aim of the "Pacific Solution" was to deter future asylum seekers from making the dangerous journey to Australia by boat, on the premise that once would-be asylum-seekers they knew that their trip would probably not end with a legitimate claim for asylum in Australia, there would be dissuaded from attempting to gain entry by this means.

The essence of the policy was to intercept asylum seekers them at sea and convey them to detention centres in the territories of third countries, specifically in the island nation of Nauru and Manus Island, Papua New Guinea. 

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Those who then qualified as refugees were offered protection in the territories in which they had been deposited or, in a limited number of cases, resettlement in countries throughout the world, including those in Europe and in the United States. Failed asylum seekers were returned to their countries of origin, or detained indefinitely on the islands.

What has been quietly forgotten, though, is that the elements of this policy were promoted by Tony Blair in March 2003, on the basis of a concept paper produced by the Home Office entitled: "New International Approaches to Asylum Processing and Protection".

Asylum seekers would be sent to "regional protection zones" outside the EU and held in "transit processing centres" while their applications were considered. The centres could be in Russia, the Ukraine or another eastern European country. Albania had also been considered. In the longer term, the Government foresaw the establishment of UN safe havens that would offer protection to refugees in regions close to the main areas of global conflict.

Speaking later, Blair observed that the nature and volume of asylum claims to the UK had changed radically, and the 1951 UN Convention on Refugees had started to show its age.

However, to cut a long story short, the idea was given a lukewarm response by the EU, although it was later picked up by Germany, with the support of Italy, for discussion at EU level. Unfortunately, it was blocked first by Spanish Interior Minister Jose Antonio Alonso, of Melilla and Ceuta fame, on "humanitarian" grounds, and then by France's Dominique de Villepin.

Effectively dead in the water, it was nevertheless resuscitated by the then Conservative leader, Michael Howard, who put immigration and asylum at the heart of the 2005 general election campaign.

What made the plan very different is that Michael Howard, unlike the Australians and Tony Blair, recognised that this could not be done within the framework of the 1951 UN Refugee Convention, and promised that a new Conservative government would withdraw from it.

With rhetoric remarkably similar to that used by the Australian prime minister four years before (also during an election campaign), Howard declared: "What we ultimately want to do is to say that no one should apply for asylum in Britain. After all, if you think about it, you can only apply for asylum in Britain today if you've entered the country illegally or by deception. It's an invitation to people to break the law".

A future Tory government, he said , would only take genuine refugees via the UNHCR, at a rate of 15,000 people a year. "Then", he said, "we really would be giving sanctuary to those who are fleeing persecution and torture and not those who simply have enough money to pay the people smugglers".

Interestingly, of the Blair version of the plan, Amnesty International had observed that it clearly represented an attempt to circumvent important domestic and international legal instruments, including the Refugee Convention. It also contravened the intent and purpose of the right to seek and enjoy asylum set out in the Universal Declaration of Human Rights.

Bizarrely, though, when it came to the Howard plan, Blair himself condemned it – even though it was a version of his own. It was, he said, "incoherent babble". The idea of sending asylum seekers to regional processing centres was a "fantasy island" policy.

It was left to Howard to defend the plan. "I'm interested in doing the right thing for the people of this country", he said. "I believe that we have to bring immigration under control, we have to limit the circumstances that people apply for asylum in this country". 

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But, within a month of winning the general election, the new Blair government had formally abandoned the plan, which was actually still on the table after Blair had proposed it. This left the UK government processing a growing number of refugees, while trying desperately and failing to find homes for an increasingly larger number of failed asylum seekers, eventually having to allow them to stay – exactly the problem the Norwegians are now confronting.

As for the Australians, after abandoning their "Pacific Solution" in 2008, the Abbott government launched something very similar under the title Operation Sovereign Borders.

Of dubious legality, if it does not actually contravene the 1951 Convention, it drives a cart and horse through the spirit of the thing, making out the Australians to be the ultimate hypocrites as they pretend to be functioning members of the international community while effectively ignoring international conventions – as indeed they did in the "Tampa affair".

At least our own Michael Howard had the intellectual coherence and the honesty to recognise that a large part of the problem was the UN Convention, one that even Blair conceded was "showing its age". To be consistent, if the Australians are to continue their policy, they should at least do the decent thing and withdraw from it, as indeed we must.

How utterly bizarre can you get, then, when UKIP, in offering 100 reasons to vote for it, has for its 76th item: "Protecting genuine refugees by returning to the UN Convention of Refugees principles".

When the Convention is actually part of the problem, and both Conservatives and Labour have pointed to the need to resolve its limitations, and the Australians effectively have to ignore it in order to construct a halfway effective policy, only amateurs such as Ukip could stand up and support it.

Strangely, though, the party does not seem to support the Australian asylum policy – but then, if it did, it would be trailing in the wake of the Conservative Michael Howard, and that would never do.


Richard North 31/01/2015
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 EU exit: the ignorance of the high and mighty

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There was a time once when senior political figures said things and I listened, purely on the assumption that they must be better informed, more experienced, and with better contacts and understanding.

Like the plan that falls apart with first contact with the enemy, my deference to "senior political figures" survived for as long as it took for me to meet some of them, when the residual question became one of how these people manage to function on the incredibly low level of knowledge and understanding that they actually possessed.

Very much falling into that category is former Swedish prime minister, Carl Bildt, currently lauded by the Guardian for his supposed insight into the fate of Mr Cameron's treaty change in the wake of the Syriza victory in the Greek election.

According to the Guardian-appointed sage, this victory deals a "severe blow" to Cameron's hopes, the man "warning" us that the appetite for treaty change in the EU has diminished since the election. "Treaty change will be very difficult", he thus tells us.

No one in the business, though, was ever under the impression that there was any appetite for treaty change. In fact, two years ago almost to the day, we were writing of the lack of enthusiasm for a new treaty, and in this respect nothing much has changed in the intervening period.

What has changed, of course, is Cameron's tactical approach, in that he is most likely preparing to avail himself of the "simplified procedure" afforded by Article 48, but such subtlety is a closed book to the Guardian And Mr Bildt. But then, is an ex prime minister, and these sort of people know very little indeed.

However, Bildt has clearly has failed to update himself on the Lisbon Treaty changes (even though he signed up to them), and he is thus working under the impression that, if the treaty process is opened up, the new Greek prime minister, Alexis Tsipras, will be able to use this as a chance to press for changes to the rules governing the single currency.

Under the Art. 48 procedure, of course, only Part III (TFEU) issues can be amended, and that does not include single currency. The euro is safe from any interference by Mr Tsipras and his pals.

What enables Bildt to spread his ignorance, though, is prestige. Endowed with this commodity, he can deliver any amount of tosh to the Guardian, not because it is right, or because the man has any insights worth having, but simply because his prestige carries the day.

Earlier, the man was talking a similar level of tosh at an event organised by the Europhile British Influence at the Royal United Services Institute. There, he was also in a cautionary mood, telling us that the EU and Britain would be diminished if the UK left the EU.

"The weight of the EU on the global stage will diminish but the weight of the UK would diminish even more because the UK is important as a significant actor inside the EU", he said. "Ask Washington. They would go to Brussels, Berlin, Paris. Americans would still change aircraft at Heathrow but that would be about it. I am exaggerating slightly. But there would be a risk of that".

Frankly, US officials are these days more likely to be en route to Geneva or Basel, than Brussels, because that increasingly is where the action is. But the "little European" in Bildt wouldn't be aware of that. His horizon stops at Brussels.

At least, though, he recognises that negotiating a divorce would be "cumbersome but doable", but then we get the usual tedious drivel from a man who fails to step outside the intellectual boundaries set for him.

Those who believe the UK could negotiate a relationship with the EU along the lines of Norway and Switzerland, he says, "would turn the UK into a satellite of the EU". Norway has tariff-free access to the EU's single market as a member of the European Economic Area (EEA). But it has to abide by EU regulations related to the single market "over which Norway has no voting rights".

So he drivels on, pouring out the same derivative tosh that we've heard so many times before. "If you want to be part of the single market [but not in the EU] you would have to enter what is de facto a satellite relationship with Brussels without any influence on the decision making".

Not in the least understanding how the world has changed, and how the Norwegians have it sussed, he then bleats about whether this would this be acceptable to the UK parliament, surmising that we would then have to leave the single market.

"The single market is dependent on the common decision making of the rules of the single market. It is defined by the single rules. Those are decided by the Brussels procedures", he says. "If you want to be part of the market and outside of Brussels then you end up with a huge democratic deficit".

These people are so out of date now that it is a pleasure to see them try it on yet again, as if they had any chance of winning the argument. But we do perceive a slight change, in that he is admitting that we can leave the EU and stay in the single market, so there is some process.

As to who makes the rules, as we know, it isn't Brussels. We need to be "outside of Brussels" to resume our place at the top table, and the likes of Mr Bildt haven't even realised it yet.

Why should we defer to these people? They are the epitome of ignorance.


Richard North 29/01/2015
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 EU regulation: a confusion of responsibilities

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Although they account for just five percent of traffic, lorries are responsible for 15 percent of fatal collisions - around 4,200 in Europe per year - and around half of cyclist deaths in London.

So says The Times today, retailing a set of factoids which are taken out and dusted every now and again, especially by the EU when it is trying to justify more regulation of the transport fleet.

We thus saw in 2011 when the European Parliament tabled a declaration in support of the mandatory fitting of advanced emergency braking systems and lane departure warning systems.

Then, lorries accounted for three percent of traffic, giving rise to 14 percent of fatal collisions and 4,000 deaths. In percentage terms, lorries are killing fewer people. Quantitatively, more people are dying under the wheels of trucks.

The last time we raised this issue though, there was a discussion as to the general responsibility for safety, the extent to which it lay with the drivers and cyclists, and how much safety should be designed in, enforced by regulation.

Very much in the "design" camp is London Mayor Boris Johnson, who has joined with Chris Boardman, the former Olympic champion, and Kate Cairns, the sister of a cyclist killed by a lorry driver in London, to call on the Department for Transport to throw its full support behind measures that could save hundreds of lives each year.

The problem being addressed is the length restriction on different classes of lorries, leading manufacturers to design their vehicles with short, flat-fronted driver cabs, in order to maximise the proportion of load space. This results in cabs with multiple blind-spots and no crumple zones.

Until 1997, regulation on such issues as blind spots was a matter for the EU, but progressively such matters as the fitting of mirrors, vision panels, and other vision aids (such as video cameras) has been a matter for UNECE (United Nations Economic Commission Europe).

Progressively, EU legislation on vehicle design is being repealed and replaced with UNECE Regulations, implemented by EC Regulation 661/2009 under the aegis of Directive 407/2011, applicable since 1 November of this year.

Currently, we are in a transition process, and the state of play is helpfully summed up by our own Department for Transport (DfT), in this bulletin. It lists some of the 50 EU Directives that have been repealed and replaced with UN Regulations covering the same subjects.

However, to add to the confusion, the European Commission tells us that vehicle dimensions (and hence length restrictions) are not covered by UNECE, and remain an EU competence.

Having first checked that they would not contravene any international agreements, therefore, in April last, new EU Regulations on vehicle dimensions were agreed, after considerable delay, with the expectation that trucks conforming to these new dimensions (fitted with "safety cabs") could be expected on the roads by 2018-2020.

Now, it looks as if this is not to be. The thrust of the current Times story is to tell us that, under pressure from companies like Renault and Volvo, the French and Swedish governments are seeking to ban new cab designs until 2025 to avoid disadvantaging firms who have already begun introducing their new truck models for the next decade.

Campaigners are complaining that the UK government has been "sitting on its hands" and failing to mount strong opposition to France and Sweden. But what is of special interest here is that the DfT has said it favours alternative legislation, known as "type approval" to make safety changes.

Should this be the route taken, though, it would have significant implications, taking the regulations out of the hands of the EU and vesting the responsibility in UNECE, which deals with type approval matters.

This, in fact, is simply going with the direction of travel, signalled last year, when the Commission announced that it was steering a reform of the UNECE 1958 Agreement on international vehicle regulations, with a view to getting agreement on a system known as the "International Whole Vehicle Type Approval".

The 1958 Agreement, it says, has not been updated since 1995 and the specific challenges entailed by the accelerating globalisation of the automotive industry and market in the last decades call for a fundamental reform of this Agreement.

Very much under the radar, this process has been going on now for two years, when the Commission declared in its CARS 2020 Action Plan that international harmonisation of vehicle regulations had been a priority for many years.

The EU had taken the view that agreeing common regulations with other major markets around the globe offered the benefit of lower compliance costs, generated economies of scale and reduces technical barriers to trade. The overall objective was to establish the principle of "tested once, admitted everywhere", whilst ensuring the promotion and maintenance of the highest safety and environmental standards.

And, despite high profile initiatives such as TTIP – the EU-US trade agreement - the final CARS21 Report had concluded that the most effective instrument for international regulatory harmonisation was the UNECE 1958 Agreement, "provided it is modernised to accommodate the needs of emerging economies and to the extent that it enables the mutual recognition of international whole vehicle type approvals (IWVTA) starting with the category of passenger cars".

The acceptance of the regulations established under the 1958 Agreement by the EU's trading partners has been recognised as the best way to remove non-tariff barriers to trade.

Furthermore, the Commission avers, in order to enable countries with emerging automotive industries and markets to agree and apply common global standards alongside other major markets around the world, and thus to offer additional benefits of lower compliance costs and economies of scale, the attractiveness and the reliability of the 1958 Agreement needed to be enhanced.

What few people realise is how deeply embedded the EU has become in this process. The Commission has actually taken the leadership of the UNECE task force in charge of preparing the draft proposal for a new Agreement.

The first informal draft was presented to WP.29 – the World Forum on the Harmonisation of Vehicle Regulation - in March 2013 and, in November 2013, a formal document with amending proposals for revision was submitted. Currently, all contracting parties are scrutinising the proposed changes and will provide their feedback at the next session of WP.29 in June 2014.

An informal working group, under the co-chairmanship of the European Commission and Japan, expects to submit final proposals to WP.29, ready for the formal procedure for adoption of the revised Agreement to be launched at the March 2015 session of WP.29 with a view to allowing the Agreement to enter into force in March 2016.

Between them, therefore, Japan and the European Commission are setting the standards for vehicle regulation for the coming decades – an international agreement to which, at some time in the future, it is hoped that the United States will join.

The UK is part of this process, but only as 1/28th of the team that authorises the "common position" guiding the commission negotiators. It hands its voting power to the commission for the final approval of the Agreement, while countries such as Norway and Switzerland (and Japan) will exercise their votes on their own behalf.

For the future though, there will be no confusion about the source of vehicle regulation. It will be made in Geneva, the home of UNECE and WP.29, but with the active participation of the EU, which maintains a substantial office in the city. By the time it gets to Brussels, and placed in front of the European Parliament, that "showcase" of democracy, it will be beyond change.

When cyclists continue to be slaughtered in ever-increasing numbers, Mr Johnson's successor will have to by-pass Brussels and go straight to Geneva to lobby for new or additional laws.

The interesting thing then is that it will not make any difference whether we are in or out of the EU, the destination will be the same. In or out of the EU, the regulations will also be the same, which adds to a further level of caution to our previous piece

We cannot begin to remove layers of regulation following our withdrawal from the EU, until we have worked out their origin. And where, as is the case here, the law originates in Geneva, it will be around long after the EU treaties are gone.


Richard North 10/12/2014
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