Is the end nigh for the Euro? [vol. 3]

[RYH64E]

Andy Zarse said:

On the contrary, I think you're absolutely spot on. That was the original intention. The EU "internal market" are not about free trade anymore, it's become a customs union intended to protect against outside competition. It and the Euro are classically protectionist. However a strong Euro and its Germanic monetary hair shirt are strangling its weakest members.

And as things stand we're inside the protectionist internal market, why do so many on here believe we'll still have free and unfettered access if we decide to leave the EU? The savings in contributions to the EU budget (and other petty annoyances) could be dwarfed by the cost of loss of trade with the enormous (and very lucrative) market on our door step.

[rovermorris999]

RYH64E said:

And as things stand we're inside the protectionist internal market, why do so many on here believe we'll still have free and unfettered access if we decide to leave the EU? The savings in contributions to the EU budget (and other petty annoyances) could be dwarfed by the cost of loss of trade with the enormous (and very lucrative) market on our door step.

Because they sell us more than we sell them. Plus WTO rules will apply. The pressure put on politicians by mainland European manufacturers to have a free trade agreement would be intense.

[Gargamel]

RYH64E said:

And as things stand we're inside the protectionist internal market, why do so many on here believe we'll still have free and unfettered access if we decide to leave the EU? The savings in contributions to the EU budget (and other petty annoyances) could be dwarfed by the cost of loss of trade with the enormous (and very lucrative) market on our door step.

I do worry about this aspect, and the fact is no one can ever really know the cost or impacts.

Positive arguments

Switzerland isn't an EU member but trades
Given our balance of payments issues with the EU, they need access to our market, every bit as much as we need them
World Trade is governed by the WTO not the EU
We would have the ability to align more with our Global trading partners at more favourable terms than under the EU Aegis


Negative ones

Uncertainty
Bound to be some sharp practice in reality - "French Customs inspections" for example
Would US and Chinese FDI's still want to be HQ'd in UK if we aren't in the Union
Consultancy and Financial Services could be badly hit
The EU hate that London and Non Euro (currency) country trades all the currency and debt - so if we were out the EU they would hate it even more, and I suspect legislate to deal with it once and for all.


However, economics is one thing, legislative freedom is another.

[Andy Zarse]

RYH64E said:

Andy Zarse said:

On the contrary, I think you're absolutely spot on. That was the original intention. The EU "internal market" are not about free trade anymore, it's become a customs union intended to protect against outside competition. It and the Euro are classically protectionist. However a strong Euro and its Germanic monetary hair shirt are strangling its weakest members.

And as things stand we're inside the protectionist internal market, why do so many on here believe we'll still have free and unfettered access if we decide to leave the EU? The savings in contributions to the EU budget (and other petty annoyances) could be dwarfed by the cost of loss of trade with the enormous (and very lucrative) market on our door step.

Why would we have to leave the internal market? T

The loss of trade? You do realise the EU actually stops us trading with the rest of the world? You know, the bit that's growing not shrinking. Anyway I would have thought that leaving behind a balance of payments deficit of (IIRC) c£27BN pa would be seen as a good thing but each to his own I suppose.

[RYH64E]

Andy Zarse said:

You do realise the EU actually stops us trading with the rest of the world?

How so? I've got customers in Canada, several countries in Africa (and most of Europe), and buy from the USA and the Far East, I obviously didn't get the EU Directive banning such things.

As for our contribution to the EU budget, one of my warehouse lads brought his tax statement up today (similar to the one shown below), his contribution to the EU budget is about £25 per year. If you're looking for ways to save money there are bigger targets than the relatively insignificant contribution to the eu budget.

[RYH64E]

rovermorris999 said:

Because they sell us more than we sell them. Plus WTO rules will apply. The pressure put on politicians by mainland European manufacturers to have a free trade agreement would be intense.

Each one of the EU countries stands to lose a single export market, we would be jeopardising sales to a single market comprising 27 countries. In total, the 27 countries may well sell more to us than we sell to them, but any loss would be divided between the 27, whereas our loss will be ours alone.

[Digga]

RYH64E said:

rovermorris999 said:

Because they sell us more than we sell them. Plus WTO rules will apply. The pressure put on politicians by mainland European manufacturers to have a free trade agreement would be intense.

Each one of the EU countries stands to lose a single export market, we would be jeopardising sales to a single market comprising 27 countries. In total, the 27 countries may well sell more to us than we sell to them, but any loss would be divided between the 27, whereas our loss will be ours alone.

We're still, arguably, the 5th largest economy in the world and one of the only European nations showing signs of economic life right now. If they are daft enough to turn their back on that - and I don't for one minute think the group-think of the EU is not capable of such a pique of anger - then so be it. As has been pointed out, they would be the net loser.

However, there are larger, faster developing economies in the world, where we would then be able to forge our own trade agreements, unfettered by the EU.

[RYH64E]

Digga said:

We're still, arguably, the 5th largest economy in the world and one of the only European nations showing signs of economic life right now. If they are daft enough to turn their back on that - and I don't for one minute think the group-think of the EU is not capable of such a pique of anger - then so be it. As has been pointed out, they would be the net loser.

However, there are larger, faster developing economies in the world, where we would then be able to forge our own trade agreements, unfettered by the EU.

If anyone is being daft it's us, why turn your back on an enormous (protectionist) market that's on the doorstep just so you can save the relatively insignificant cost that membership entails (see the pie chart I posted above)? Life is good at present, the economy is growing, why risk the recovery?

As for the faster growing economies, I haven't been prevented from selling where I want, if there's a restriction I'm not aware of it.

[Digga]

RYH64E said:

If anyone is being daft it's us, why turn your back on an enormous (protectionist) market that's on the doorstep just so you can save the relatively insignificant cost that membership entails (see the pie chart I posted above)? Life is good at present, the economy is growing, why risk the recovery?

Not really, it is becoming clear that the Eu will make deeper and more problematic incursions into our legal framework and also that wealtheir Eu nations are, broadly speaking, from now on going to do an increasing share of the financial heavy-lifting to get the struggling and dysfunctional bits of Europe out of the mire.

RYH64E said:

As for the faster growing economies, I haven't been prevented from selling where I want, if there's a restriction I'm not aware of it.

No one is implying there are total, absolute barriers, but there are opportunities for agreements and enhancements to trade that are not available to us as members of the EU, but could be negotiated on our own account.

[RYH64E]

Digga said:

Not really, it is becoming clear that the Eu will make deeper and more problematic incursions into our legal framework and also that wealtheir Eu nations are, broadly speaking, from now on going to do an increasing share of the financial heavy-lifting to get the struggling and dysfunctional bits of Europe out of the mire.

To put it into perspective, I'll re-post the pie chart I posted earlier. Is it really worth the risk to save a relatively paltry amount of money? If I look at my personal contribution to the EU budget through income tax it's maybe £100, on the other hand my Corporation Tax payment on profits from EU trade alone will be in the region of £40k this year. The cost is trivial, the legislative nonsense just an irritant (also minor in the scheme of things), but the risks are massive.

[Gargamel]

Latest estimate is that the UK has given just over £50bn to the EU during this parliament.

Now tell me that is insignificant ?

Secondly, that is only direct contribution. What about the costs of compliance with EU legislation, directives and other procedures.

I am all for harmonisation of standards, where sensible. but as we have seen over the years many are nonsense.

Additionally I am sick of the CAP and lack of reform in this area, if French Farmes want to continue peasant level subsistence farming methods, then good for them, but why should the UK subsidize them to do so ?

[rovermorris999]

RYH64E said:

Each one of the EU countries stands to lose a single export market, we would be jeopardising sales to a single market comprising 27 countries. In total, the 27 countries may well sell more to us than we sell to them, but any loss would be divided between the 27, whereas our loss will be ours alone.

There would be little or no jeapordising going on. Pragmatism will rule the day.

[RYH64E]

rovermorris999 said:

There would be little or no jeapordising going on. Pragmatism will rule the day.

So you say, I'm not reassured.

[Digga]

RYH64E said:

Is it really worth the risk to save a relatively paltry amount of money?

The instant the EU start talking bail-ins then the contributions are the least of our worries.

[Andy Zarse]

Gargamel said:

Latest estimate is that the UK has given just over £50bn to the EU during this parliament.

Now tell me that is insignificant ?

Secondly, that is only direct contribution. What about the costs of compliance with EU legislation, directives and other procedures.

I am all for harmonisation of standards, where sensible. but as we have seen over the years many are nonsense.

Additionally I am sick of the CAP and lack of reform in this area, if French Farmes want to continue peasant level subsistence farming methods, then good for them, but why should the UK subsidize them to do so ?

Spot on.

I think it's also right to point out the idiocy of RYH64E quoting tax figures from 2011. They are so out of date as to be utterly meaningless. The UK's net figures, taking into account the UK’s rebate – show the UK’s contribution to the EU was £2.7bn in 2008, rising to £3.8bn in 2009, £7.2bn in 2010, £7.5bn in 2011, £8.5bn in 2012 and £11.3bn in 2013. IIRC 2014's figure is estimated at £14bn, plus of course the extra £1.7BN for the "economic success taxation". Anyone else spot a pattern emerging here?

Based on this, and in the knowledge that income tax allowances have risen whilst wages have fallen in real terms, perhaps RYH can tell us what bits of his precious pie chart he would cut to pay for the ridiculous folly of EU membership? (won't hold my breath).

CAP is a disgraceful blight on humanity. Why the likes of Bonio etc aren't up in arms about it I do not know. CAP crushes markets for African farmers, impoverishes them and their fragile societies. I want no further part of this disgusting evil.

Then there's the hidden costs, as you rightly say. The Lisbon Treaty alone is reckoned to have cost UK business over £18bn since it was signed behind closed doors by Gordon Brown. http://businessforbritain.org/2014/11/03/lisbon-tr...

[Andy Zarse]

RYH64E said:

How so? I've got customers in Canada, several countries in Africa (and most of Europe), and buy from the USA and the Far East, I obviously didn't get the EU Directive banning such things.

As for our contribution to the EU budget, one of my warehouse lads brought his tax statement up today (similar to the one shown below), his contribution to the EU budget is about £25 per year. If you're looking for ways to save money there are bigger targets than the relatively insignificant contribution to the eu budget.

I trust you pointed out to the poor lad he's paying £25 (probably nearer £75, see above) to have his weekly wages slashed because the EU forces this country to allow unlimited numbers of hardworking EU migrants work here in low skilled jobs.

You didn't did you?

Tell us honestly, how much pay rise are you giving your warehouse staff this year? Oh and what percentage are on minimum wage?

[RYH64E]

Andy Zarse said:

perhaps RYH can tell us what bits of his precious pie chart he would cut to pay for the ridiculous folly of EU membership? (won't hold my breath).

Working round the chart, I'd happily cut spending on welfare, environment, recreation culture and religion, overseas aid, government administration, housing, defence, health and debt. Most of the other sectors in fact.

I reckon I spend more per month on wine and coffee than the EU costs me in a year, and HMRC makes a lot more money from my EU sales than my contribution to the EU budget, that's before you factor in the employees whose jobs depend upon the EU and their tax contribution.

If ever we get to a situation where the trade benefits of EU memberships can be guaranteed (and not just by UKIP or like minded posters on here) post exit then I'd be in full agreement, until such time I'm happy to stay in and keep making money.

Why do you think the EU members (who are individual states not a homogenous whole) will let us keep all the benefits with none of the costs? The French would happily see us screwed, even if it cost them money.

[RYH64E]

Andy Zarse said:

Tell us honestly, how much pay rise are you giving your warehouse staff this year? Oh and what percentage are on minimum wage?

That's easy, 5% rise come April and my lowest paid employee is on £8.50 per hour, so 0% on minimum wage. Sales are currently up 35% year on year, net profit more than double last years. All good.

[Andy Zarse]

RYH64E said:

Andy Zarse said:

perhaps RYH can tell us what bits of his precious pie chart he would cut to pay for the ridiculous folly of EU membership? (won't hold my breath).

Working round the chart, I'd happily cut spending on welfare, environment, recreation culture and religion, overseas aid, government administration, housing, defence, health and debt. Most of the other sectors in fact.

I reckon I spend more per month on wine and coffee than the EU costs me in a year, and HMRC makes a lot more money from my EU sales than my contribution to the EU budget, that's before you factor in the employees whose jobs depend upon the EU and their tax contribution.

If ever we get to a situation where the trade benefits of EU memberships can be guaranteed (and not just by UKIP or like minded posters on here) post exit then I'd be in full agreement, until such time I'm happy to stay in and keep making money.

Why do you think the EU members (who are individual states not a homogenous whole) will let us keep all the benefits with none of the costs? The French would happily see us screwed, even if it cost them money.

What I can never understand about you is that you're never prepared to countenance the UK trying to get a better deal. In order to get a deal at any negotiation you have to be prepared to walk away from the table. The Scottish referendum showed us that (oh and also that Jock is about to be stitched up by Westminster duplicity). What we really need is simple access to the markets, free movement of goods, capital and labour (which is why I disagree with UKIP) and other than some basic agreed standards, that's about it.

What I meant by my (admittedly badly-worded) comment earlier was that being an EU member does raise barriers to trade with other non-EU countries, not that it prevents all trade (as I suspect you realised). We cannot agree our own free trade deals with the vast majority of the world economy. And when the EU negotiates on these deals it has to do so for 27 different countries with inevitable compromises. On every trade deal there must be nothing, and I repeat NOTHING, done to damage French agriculture for example. This is a main reason why there's still, 70 years after the end of WW2, no free trade deal with the USA. It's utterly crazy.

[LongQ]

Andy Zarse said:

CAP is a disgraceful blight on humanity. Why the likes of Bonio etc aren't up in arms about it I do not know. CAP crushes markets for African farmers, impoverishes them and their fragile societies. I want no further part of this disgusting evil.

From what I read he's probably not able to put his arms up at the moment.