Hey  ukip and BREXIT bods some questions 

The leave campaign, such as it is, has as yet not actually managed to offer the public a concise picture of the future. 

Will we still have access to the single market? If not what will the replacement look like?

Will we be able to sell services, 78% of our economy, to the EU free of WTO tariffs? 

What kind of non tariff barriers will we face? 

Will there be a visa system for holiday makers? 

Will the CAP payments be maintained at the current level and for how long? 

How do we get future governments to guarantee CAP payments at EU levels? When agriculture, in reality, employs few people on the UK and does not have the influence of numbers

How will we ensure that governments of different hues will maintain structural  aid, even when it’s directed at areas where it would give them no political gain?

Northern Ireland and Wales are net gainers from the EU budget. Will the Westminster government maintain this investment? 

What is an acceptable loss of GDP over the next 20 years? 

How exactly will making our own trade deals increase the amount we export?

Explain in detail the reasons you think food will be cheaper? 

Leave campaigners claim we can cut the cost of regulation. Account for which regulations will be removed in order to achieve this lower cost.

How are you going to address the very real fears of NI and Eire?

The Working Time Directive is often seen as a Cost to  businesses. Do you envisage it being removed from UK employment regulations, if so what would replace it? 

The leave campaign claim fuel prices will be cheaper. If this is through a removal of VAT, where will the government recoup this loss in income?  

How will you guarantee that a government in thrall to busines does not erode my right to paid leave? 

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  Ukip, The Commonwealth and BREXIT 

The idea that by joining the EU we abandoned the Commonwealth Nations is not a new one. In 1975, when we last voted on membership, it was thought to be enough of an issue to be addressed in the leaflet sent to each household:


In 1975 the government of Australia was clear and things have not changed, in a recent interview in The Telegraph the ex deputy prime minister had this to say:

“International companies from outside the EU – from, say, the US, Japan and, indeed, Australia – base themselves in the UK in no small part so they can access the wider European market. The single market is especially beneficial for your vibrant and world-beating financial services industry, which benefits from having all of Europe as its home market instead of just Britain. I can see no good reason why the UK would want to give up such a beneficial economic relationship with its nearest and largest trading partners – nor am I clear what you would replace it with”

It seems clear that the views of one of the wealthiest Commonwealth Nations have not changed.

So where does this idea of Commonwealth reconnect come from. It’s certainly not a new idea, those like Rory Broomfield, who is a director at the think tank The Freedom Association and of Better off Out, have been pushing this view for some time: (it is worth remembering that The Freedom Association has as its aim the deregulation of the labour market)

The book that was written to help promote this view is sadly no longer available from the links found here but can be found as a kindle edition on Amazon. What it has at its heart is the rather paternalistic view that the Commonwealth Nations want trade with the UK at all costs and are prepared to enter a free trade agreement with us.

It also has a belief that a trading block can be formed that would either replace lost trade with the EU  and, or, would allow us to make trade deals that would increase our trade with these nations. Something they claim we can not do whilst still a member of the EU.

Let’s address these separately: 

The claim made by many a kipper and brexiter is that the Commonwealth at over 2 billion people with a GDP fast approaching that of the 550 million people of the EU, is a better long term trading partner that the EU. They will make grandiose statements about growth rates across the Commonwealth and expect you to be bowled over by the wealth of trading opportunities.

What are the realities?

I am a geographer and a teacher so I like maps and I like to think out side of the box. The reality is that much of the commonwealth, has not yet reached the toothbrush for each family member  stage of development, this article from Anna Rosling-Rönnlund will explain. Or as Hans Rosling would put it, they are not yet in the washing machine economy. If the vast majority can not afford a toothbrush , its laughable to assume they will be buying financial services products.

How about the maps? 

The data for GDP Per capita is easy to find, you can use PPP data to make it fairer and I have, a simple on-line map maker and you can produce a map that can be downloaded for use on a blog.

You can find the online version here (it does not work well on tablets and phones):

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This map clearly shows that we have a problem if we want to trade with the Commonwealth our goods and services services are simply too expensive for the vast majority of those living in countries with a GNP per capita of less than $6000 per annum. If you need more help in understanding try this, gap minder and Dollar Street  .

Income is not the only consideration, a small or medium sized company doing trade in the EU is protected by a plethora of regulations and can be assured that the cost of doing business is not increased by corrupt practices:

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All those countries that are pink and yellow have a lamentable record of corruption and governance, more details can be found at Transparency `International 

There are those who strongly advocate a Commonwealth Reconnect but the reality is that there are many divisions within the Commonwealth and a real problem with the emerging countries in the Commonwealth being considerably less open to trade then we would want as well as less keen on democracy, some of the opposing views are discussed here. The conclusions reached are clear, in reality most of the Commonwealth shares little with the UK.

The problem goes still wider. Look at the voting records of the United Nations Security Council, or the UN’s grisly sub-committees on human rights, and compare Britain’s votes with (a) votes of other EU members and (b) votes of other Commonwealth members. Whether Eurosceptics like it or not, Britain is far closer to (a) than (b). Many Commonwealth members are far removed from Britain’s way of seeing the world, aligning themselves firmly with the “south” in an inchoate “north-south” stand-off. The EU may not have played a blamless role in the decade-long misery that is the latest round of talks at the World Trade Organisation. But in truth, one of the biggest obstacles to a deal for a long time has been India, a Commonwealth giant that is far from a reliable ally on free trade and market-opening.

While I am being difficult, I would leave readers with data from the latest Chatham House YouGov polling for 2011, which asked British voters to rank foreign countries in terms of favourability and unfavourability. True, Commonwealth stalwarts Australia, Canada and New Zealand take the top three favourability slots for non-European nations, with only America coming anywhere close.

But the same British respondents are strikingly hostile to the other Commonwealth nations on the list, such as India, South Africa (6% approval apiece) and above all Pakistan (1%), which comes bottom of the table, just above North Korea. It would be depressing if at least some British public support for the “Commonwealth” meant nothing more than liking unthreatening, English-speaking western countries that look rather like us. (The Economist 2011)

With many UKIP supporters deeply distrustful of Muslims countries you can safely assume that they see the Commonwealth as a handful of countries which closely share our culture and religion – the rest of the Commonwealth being full of those who they are more likely to call “swarms” than trade with.

Do the Commonwealth Nations want our Trade? 

This question assumes we don’t trade with the Commonwealth so consider these facts:

  • UK’s exports to Commonwealth countries have been increasing at over 10% a year
  • The increases (over two years) of 33% to India, 31% to South Africa, 30% to Australia and 18% to Canada. In fact
  • Since 2004, British exports to India are up 143%
  • EU already has agreed trade deals with 64% of Commonwealth countries, and is negotiating with another 26%

If we lost 10% of our trade with the EU we would need to increase our trade with the Commonwealth by 40%. Since most of the trade between the EU and the Commonwealth will be covered by FTAs by the time of BREXIT, and with the UK starting from scratch with negotiations, one can rightly wonder how likely that it! More facts of the sort BREXIT run away from can be found in this article by Steve Peers .

Both UKIP and Brexit Tories share the belief that the Commonwealth Reconnect can be flogged to the public as an alternative to aid for developing counties. Its worth noting that the developing nations have made huge improvements in education and health outcomes and in GDP per capita and much of this is down to targeted aid. The UN has a 15 year plan to help the last stubborn few up out of absolute poverty. Trade with the UK is not going to help them achieve this. Indeed this is where I and the EU fall out as for me inter African trade is far more important than the EU encouraging trade between African and the EU. The bulk of the region’s trade is with Europe and America: only 12% is with other African countries, according to research by Ecobank, a Togo-based bank. By comparison 60% of Europe’s trade is with its own continent. The same is true in Asia. In North America the figure is 40%. Whilst the African Union is busy creating a Continental Free Trade Area , recognising that their ability to develop lies in unity and improving that 12%, we are busy trying to exit the EU.

 

 

 

 

 

 

Why are UKIP lying about Google? 

Since yesterday Ukip have been promoting the idea that the EU is preventing the UK from taxing large corporations such as Google.

This has been posted on their FB page. And shared numerous times on Twitter.  

 

Is there any truth in it? 

In a word, no, although it is complicated. Companies like Google use a tax avoidance tactic called transfer pricing. It’s not something only EU countries suffer tax loses from. The US is not immune, Such income shifting costs the U.S. government as much as $60 billion in annual revenue, according to Kimberly A. Clausing, an economics professor at Reed College in Portland, Oregon.

What George Osbourne said about the latest EU directive

“This directive, for perfectly understandable reasons it is not the right directive, does not address the transfer pricing issue. The transfer pricing issue has been one of the issues that has caused greatest concern. This is where companies artificially shift profits and therefore can not be taxed on where the economic activity took place that generates those profits took place. It is one of the most complicated areas of the international tax law.”

He did not say, that we would need to leave the EU to deal with it. In fact clearly with the US also losing $60 billion a year it would make no difference.

What is the EU doing?  

This is what they are doing on tax a whole raft of measures to try to prevent large corporations taking advantage of differing tax rates. This excellent PDF gives an overview of what the EU is doing, including how it wants to tackle transfer pricing. 

Specifically Margrethe Vestager is using the substantial clout the EU does have to prevent governments in thrall to big business, like the current crop of Tories, from effectively breaking state aid rules by subsidising big wealthy companies. She can fine Google and others as much as 10% of their global turnover and she us not afraid to tackle these companies. She has already  tackled Google launching formal antitrust proceedings against the company in April last year over accusations that it uses its dominance as a search engine to unfairly privilege Google’s online shopping service over those of its rivals.

Yet again UKIP have told a lie. They know that on our own we would never be able to successfully target these companies, even if our governments were actually prepared to do so. The EU is not preventing us from doing something. We are preventing ourselves from doing anything. 

Why do ukip lie, because they can not be honest about the EU, it might reveal that the only argument for brexit they have is  people’s fears over immigration.