20 November 2015

Britain can be a stronger ally for America if it leaves the EU


In the list of undeserving winners of the Nobel Peace Prize the decision to honour Barack Obama in 2009 must be close to the top – or at least near the top. The Syrian civil war, the rise of Isis and Russia’s invasion of Crimea all followed the Nobel Committee’s extraordinarily premature decision to honour a man who did not turn out to be the political messiah that some appeared to believe he was.

The 2012 decision to award the European Union should also be on the list, however. Europe’s post-WWII story is indeed a happy one but who really kept the once warring European states at peace when Soviet Moscow was bearing down upon them? When the KGB of which Vladimir Putin was a member was financing communist parties, union radicals and infiltrating western security services? If any organisation or country most deserves the Nobel peace price it is Nato, the North Atlantic Treaty Organisation. The principle of collective defence within Nato’s Article V was, of course, effectively guaranteed by the United States. Over many decades the US stationed troops in western Europe and, indeed, in other anti-communist theatres like South Korea. This – in contrast to today – was a time when Washington understood that powerful, ideological opponents required long-term deployments and a commitment to sustained battles of ideas. In Iraq, in contrast, it was surge-and-quit – and with disastrous consequences.

The economic integration of European nations has obviously helped keep the peace and the creation of the European Coal and Steel Community in 1951 – between Belgium, France, West Germany, Italy, the Netherlands and Luxembourg – made a significant contribution to the growth of intra-continental trade and investment. But is today’s “European Union” – the much more political project that grew out of the free trading ECSC – still contributing to European peace and harmony?

I don’t think so. The countries of Europe continue to under-invest in their security. Of the major powers in Nato only America (3.6%), Poland (2.2%) and Britain (2.1%) meet the aspiration to spend one-fiftieth of national income on defence. France (1.8%), Germany (1.2%), Italy (1%) and Spain (0.9%) are among 23 of 28 nations that are not pulling their weight. The United States accounts for an astonishing 67% of all spending on defence by NATO member states.

Europe is failing to invest in its security because it has learnt to free ride on America. But it is under spending for other reasons too. As Dan Hannan MEP explains in this video the economies of Europe are losing their share of world trade at a much faster rate than the United States. Europe is in economic decline because it spends too much on welfare and not enough on infrastructure and R&D. Angela Merkel famously noted that Europe accounted for “just over 7 per cent of the world’s population, produces around 25 per cent of global GDP [but had] to finance 50 per cent of global social spending”.  High levels of regulation and the eurozone project have also taken their economic toll. Even though the acute phase of the Eurozone project has passed it is still a chronic problem and not just for Greece. Much of southern Europe continues to stagnate and suffer high levels of youth unemployment. 49% of Spain’s youths are without work, for example, and 44% of Italy’s young people are jobless. This will be a scarring experience for many of them for many years to come.

It is in this context that Britain is considering whether it wants to remain part of the European Union. Within the next two years – and perhaps as early as next spring – the British people will decide to “remain” or “leave” in a referendum. Current opinion polls suggest that it will be a close run thing.

President Obama has made it clear that he would prefer for Britain to remain inside the EU but Senator Marco Rubio told me this week that it was a decision for Britain and none of America’s business. Just as he would not expect Britain to lecture America on whether it should remain part of NAFTA, America should not lecture Britain on its constitutional status. Whatever Britain decided, Senator Rubio continued, it would remain America’s “best friend” in the world. You can listen to the bookmakers’ favourite to be the Republican nominee giving his answer here.

There have been suggestions that Jeb Bush and Ted Cruz are among other Republican hopefuls who take the same position and it would be understandable if they did. The European Union represents so much of what the modern Republican Party opposes. Centralisation. Over-regulation. High levels of welfare spending. Under investment in defence. And, as we’ve learnt in the wake of the Paris attacks, minimal border control. Margaret Thatcher warned against the European Union’s meddling more than 25 years ago. “We have not successfully rolled back the frontiers of the state in Britain,” she said, “only to see them re-imposed at a European level with a European super-state exercising a new dominance from Brussels.”

My own view is that America should welcome Britain leaving the EU’s complex political architecture – but staying within some sort of free trade arrangement. One of my ten commandments of conservative politics is that if you want something done on the global stage, ask nation states rather than supranational bodies like the UN and EU to do it. Outside of the EU, Britain will be freer and has the potential to become the continent’s most dynamic economy. A more prosperous Britain will be a stronger Britain and therefore a better ally for America.

“Brexit” – as British exit from the EU is called – could also be good for the rest of Europe. If the British people were to ask to leave the club it might produce a major rethink of the whole European model. Europe may need such a shock to arrest its decline. Within the next year or so, it might get it.

Tim Montgomerie is a columnist for the The Times, a Senior Fellow at Legatum Institute and co-founder of the new website The Good Right. His “reform of capitalism” report for the Legatum Institute was published on 4th November.