“The tyranny of the majority” – really?

The phrase “the tyranny of the majority” is one that has been bandied around a lot recently. Some might be tempted to simply shrug it off as another example of Remoaners doing a bit of moaning. But the phrase actually encapsulates a serious point about the limits of democracy in a diverse, modern society. Whether the Remain voters are using the phrase correctly is, however, another question.

John Major talked about “the tyranny of the majority” at some length last November. He first used the phrase in a speech to a dinner in Westminster. Sir John made it very clear that he wanted the views of the 48% who had voted “Remain” to be taken into account by the government during its negotiations with the EU.

Tim Farron and Tony Blair quickly came out in agreement (no surprises there) as did many others. A common theme was that another referendum should be held before Britain actually left the EU. The idea was that the simple majority of votes cast in June 2016 should not determine Britain’s future for ever. That seems to be what these Remain supporters mean by “the tyranny of the majority”.

But that is not how the phrase is usually meant nor used.

The phrase was first used by American founding father Alexander Hamilton during the drafting of the Constitution of the USA back in the 18th century. Hamilton worried that if there was a permanent majority of people with one viewpoint, they could use it to oppress and disempower those with a different viewpoint.

An example being bandied around at the time was that the densely populated industrial cities might use their voting power to penalise the more thinly populated agricultural areas. Perhaps agricultural exports would be highly taxed, but no taxes put on industrial exports. So those in rural communities would be economically penalised by a larger bloc of voters. That would be unfair.

Hamilton and his colleagues sought to get around this by setting up the electoral college system for the Presidential elections and the way states have weighted voting in the US Senate. Not a perfect solution, but at least they recognised the problem and made an effort to solve it.

A more recent example in the UK might be the fox hunting ban. A majority of the population live in urban areas and prefer not to see foxes hunted by florid-faced stereotypes in red jackets on horseback. The realities of the situation in rural areas played little part in the debate. The urban majority got their way, and look set to continue to get their way for the forseeable future.

That is a real example of “the tyranny of the majority”. One section of the nation has been permanently oppressed by another, larger section which has no stake in the outcome of the oppression. I do not recall Major, Blair or Farron objecting then.

By comparison the EU Referendum vote was a simple exercise in direct democracy. Now, you may or may not approve of referendums [I’ll come back to that another time], but “the tyranny of the majority” it most certainly is not.

Photo by Chatham House, London

The Government will fail the first Brexit test by not scrapping the London Convention

Release: Immediate

 

Words: 382

Contact: Alan Hastings – 07827 399 408

Fishing for Leave recently highlighted the immediate need for the government to denounce the London Convention.

DexEU and DEFRA’s response that “in regard to historical access to waters, no decisions have yet been taken on the UK’s position” and that “we endeavour to reach an agreement…. by the time the two year Article 50 process has concluded”  is pitiful and suggests they have no intention of acting.

As lovely as it was to hear the government reiterate its position of caring for our fishing and coastal communities their response scarcely backs this rhetoric.

The London Convention must be denounced now to secure all access to our waters and obtain the strongest possible diplomatic hand.

This Convention gives historic rights for European vessels to fish in UK waters but only between 6 and 12 nautical miles from our shores.

Failing to scrap this Convention would allow the EU ‘back door’ access to this narrow strip as the convention will still apply to the UK upon withdrawal.

As the Convention requires two years notice it must be denounced immediately, and before Article 50 is triggered, to avoid an overlap allowing EU access to UK waters.

For 8 months there has only been rhetoric and no results. The government is well aware of this issue and their failure to act suggests they have no intention of securing our rich fishing waters.

Why are they not fully committed to securing this strong hand by controlling all access?

If the government does not act immediately on this easy and simple test of Brexit then it evidently has no intention of making a serious stand. The government and MP’s are about to fail this first test on Brexit.

It would show the opportunity of automatic repatriation of an industry, that could double to be worth approximately £6.3bn annually, is to be betrayed a second time. Fisheries will symbolise whether we’ve “taken back control of our borders” and will therefore be the “acid test” of Brexit.

The government must serve notice to denounce this Convention immediately. To demonstrate that it really does intend to repatriate and safeguard the nation’s greatest renewable resource.

If it does not then it looks like we’re going to have a backslide and betrayal of Brexit and that the government is all mouth and no trousers.

There is still time to lobby your MP to act on this – if you want to see our fishing grounds secured please send the letter in this link to them – http://www.ffl.org.uk/letter-to-mp/

Some helpful insights from the Freight Transport Association

The really hard tasks will begin soon. Once Article 50 is triggered, the UK government will then have to negotiate a Brexit deal that will enable our trade with both the EU and the rest of the world to continue.

As an example of how complex this might be, the Freight Transport Association (FTA) has published a submission it made to Parliament, expressing a number of concerns facing the industry.  Like many organisations involved in trade with the EU, the FTA wishes to ensure that we do not face huge disruption as a result of Mrs May’s decision that we will leave the Single Market.

The piece is worth reading in full, but a few points are worth highlighting:-

  1. There will almost certainly need to be a transitional trading arrangement between the UK and the EU. Negotiating a full trade deal may be very tight, if not unachievable, within the two year timescale of Article 50.
  2. No deal will give us as unfettered access to the Single Market as EEA membership would have done. There will inevitably have to be some trade-offs.
  3. Increased Border controls will be very time-consuming. Falling back on the WTO option would be particularly bad in this respect. The port of Dover would suffer more than anywhere else as freight movements are predicted to rise to between 14,000 and 16,000 per day in the next decade.
  4. Although tariffs are falling worldwide, some sectors of the economy would suffer if tariff-free access to the EU were lost. Tariffs of 10% or more could be imposed on motor vehicles, for instance.
  5. The biggest worry is that the EU may not want to tackle trade issues until after Brexit.  Michel Barnier, the European Commission’s Chief negotiator, made a statement suggesting that the two-year period following the formal triggering of article 50 would only be devoted to withdrawal arrangements and that issues related to the post-Brexit trade relationship with the EU would only be dealt with post-Brexit.  While this is only one person’s opinion and that other voices within the EU are keen to avoid such a disastrous scenario, it shows that the UK’s negotiators will be facing some quite difficult individuals on the other side of the table.

No, Brexit is not going to be easy. We can but hope that the Government has been preparing for these eventualities and knows what it wants before the negotiations begin.

 

Would Scotland REALLY want to rejoin the EU after Brexit?

Nicola Sturgeon is currently attempting to create the momentum for a second Scottish independence referendum  – alias “Indyref 2”. The 2014 referendum was described at the time as a “once in a generation” but Sturgeon said last Monday that because the UK voted to leave the EU but Scotland did not, there has been a “change in material circumstances” since 2014 that justifies a second vote. She wants to give Scottish voters the option “to follow the U.K. to a hard Brexit — or to become an independent country.”

“Scotland’s future will be decided not just by me, the Scottish government or the (Scottish National Party),” she said. “It will be decided by the people of Scotland. It will be Scotland’s choice. And I trust the people to make that choice.”

Some recent reports claim that the SNP’s plan for an independent Scotland now involve gaining access to the Single Market by rejoining EFTA rather than trying to rejoin the EU. No doubt we will know more after the party’s forthcoming spring conference this weekend, but given the activities of malign individuals like Tony Blair south of the Border,  it is hard to believe that all Scots – and the SNP leadership in particular – have thrown in the towel as far as membership of the EU is concerned.

Perhaps, however, reality is beginning to dawn on at least some pro-remain Scots that rejoining the EU would be on massively disadvantageous terms because the country would not benefit from the opt-outs which successive British Prime Ministers the UK fought for and which the whole UK currently enjoys.

Were Scotland to overcome concerns in Madrid, which is worried about the Catalan separatist movement, as a new state joining the EU, this would be its fate:-

(a) It would have to adopt  the euro currency  – although this can be deferred somewhat.
Furthermore, what currency would a newly independent Scotland use between leaving the UK and joining the EU? Would it use the euro unofficially like ( say) Montenegro?

What is more, to join the Eurozone,  Scotland’s top- heavy public sector would have to be pruned as vigorously as in the “club Med” countries like Greece where many unemployed people no longer have access to the NHS and long-term unemployed households are on income of only 8.40 euros per day

(b) Scotland would not have the derogations which the UK presently enjoys. For instance, VAT would have to be added to food, children’s clothes, books and house sales. The minimum rate would be 5 per cent. But much, much more would be required to make good the deficit left by the withdrawal of subsidies from England

(c) If there were a strong possibility of a yes vote, financial institutions, pension funds, mutual organisations,  charities and other investors with members and clients in England would have a duty of care to protect them from currency risks, possible exchange restrictions and seizure of money from bank accounts (as happened in Cyprus), as an independent government would quickly become financially desperate. This would undermine the position of the considerable Scottish financial,sector.

(d) Scottish energy policy has been based on selling overpriced “renewable” electricity to England and buying cheap, conventionally produced electricity in the other direction when the wind doesn’t blow.
With the discrediting of the global warming myth, Independence would give England an excellent opportunity to discontinue the arrangement.

(e) The unkindest cut of all. There are already excellent English and Welsh whisky brands which could quickly be expanded and much reduce England’s demand for Scotch whisky.

(f) The much smaller area of Scottish territorial waters and Exclusive Economic Zone (Compared with those of the UK as a whole) would be shared among an unchanged number of EU trawlers, barred from English waters by Brexit.

All in all, the prospects for Scotland if it tries to re-join the EU do look bleak.  It is hard to say how widely these negative impacts are known among the Scottish population – or indeed, by Scotland’s politicians. As mentioned above, it is possible that the SNP’s recent talk of looking at EFTA rather than EU membership may be due to their recognition of  harsh reality of these disadvantages.

However, in the event of any attempt to whip up support for re-joining the EU by the SNP or anyone else, we believe the points set out above need to be widely publicised throughout Scotland. For anyone wishing to start the ball rolling, this helpful website gives a list of all Scottish newspapers, great and small.

Another nail in the coffin of the Single Market?

Last month, an event occurred which got little fanfare, but is likely to have a significant effect on the future of the UK, especially after Brexit. What happened was that the WTO Trade Facilitation Agreement has now entered into force

Lord Lamont, the former UK Chancellor of the Exchequer wrote in The Telegraph:wto

The single market is open to all advanced economies, in exchange for paying a relatively modest tariff of 3 to 4 per cent, something that evidently does not stop non-EU countries from selling within it.

‘Every developed country has access to the single market. The EU has a relatively low external tariff with the exception of certain goods such as agriculture.’[i]

When taken prima facie, Lord Lamont’s comments are seemingly correct. Only those countries who are essentially rogue states or have violated international agreements don’t have the ability to conduct trade with the EU, and the EU’s external tariffs are fairly low.

But Tariffs are only half of the story.

The problem of tariffs could be easily addressed by the UK signing a goods Free Trade Agreement (FTA) with the EU. Given the high volume of UK- EU 27 trade, this is seemingly a given.

A basic FTA need not take long to complete. The EU’s earlier iteration the European Economic Community (EEC) concluded basic FTAs in the early 70’s that took 6-7 months to agree, sign and come into force.

But the other half of the story relates to non-tariff barriers (NTBs), sometimes called “Non-Tariff Measures (NTMs)”. These comprise everything else that can slow down trade or make it more expensive or complex.

The European Commission describes the Single Market as:

‘…one territory without any internal borders or other regulatory obstacles to the free movement of goods and services. The Commission works to remove or reduce barriers to intra-EU trade and prevent the creation of new ones so enterprises can trade freely in the EU and beyond. It applies Treaty rules prohibiting quantitative restrictions on imports and exports (Articles 34 to 36 TFEU ) and manages the notification procedures on technical regulations (2015/1535) and technical barriers to trade.’[ii]

So the Single Market goes beyond tariff reduction, and encompasses far more than just a Free Trade agreement. This is why the ‘remain’ side in the EU referendum campaign were so concerned about the UK leaving the European Union’s Single Market.

‘Remainers’ believe that after Brexit, even if the UK does get a Free Trade Agreement, our importers and exporters will be deluged with red tape, endless forms, checks and other barriers to entry as we will be operating outside the Single Market.

These are valid concerns, but we believe they are largely exaggerated – and here are the reasons why:

wco

The EU has signed up to the WCO

In July 2007[iii], the EU signed up to the World Customs Organization (WCO) which works to enhance customs co-operation between signatory countries and works to simplify issues such as Rules of Origin (ROO).

From the European Commission’s own press release:

‘On 30 June 2007, the Council of the World Customs Organization (WCO) decided to accept the request of the European Union to join the WCO as of 1st July 2007. This decision grants to the European Union rights and obligations on an interim basis akin to those enjoyed by WCO Members.

‘The WCO plays an important role in promoting international customs co-operation and addressing new challenges for customs and trade. It is deeply involved in designing and implementing policies worldwide that integrate measures, which help ensure supply chain security, combat counterfeiting, promote trade and development, as well as guarantee efficient collection of customs revenues. Membership of the WCO highlights and confirms the central role and competence of the EU in international discussions on customs issues including customs reform. EU involvement in the WCO will focus on the full spectrum of customs issues, in particular the following broad areas:

  • Nomenclature and classification in the framework of the Harmonised system;
  • Origin of goods;
  • Customs value;
  • Simplification and harmonisation of customs procedures and trade facilitation;
  • Development of supply chain security standards;
  • Development of IPR enforcement standards;
  • Capacity building for customs modernisation and reforms, including in the context of development cooperation;
  • Mutual Administrative Assistance for the prevention, investigation and repression of customs offences.

‘The EU is a contracting party to several WCO Conventions, and contributes to the work of this organisation, including by ensuring presence and coordination with the Member States in defining and representing EU positions in the relevant bodies managing these conventions.’

The UK signed up to the WCO in the 1950’s and is a signatory in its own right, so will be able to address customs issues with the EU via this body after Brexit.

Harmonisation with EU rules

The UK’s rules and regulations are already synchronised with EU/EEA (European Economic Area) regulations and standards after decades of membership. This will also be true on the day after Brexit due to the Great Repeal Bill. Hence a strong (if not overwhelming) argument for ‘rules equivalence’ can be made.

The WTO Agreement on Rules of Origin (ROO)

This agreement encourages WTO countries (including all EU countries) to have fair and transparent rules pertaining to Rules of Origin:

 wtostructure

These rules state that:

‘Rules of origin shall not themselves create restrictive, distorting, or disruptive effects on international trade.  They shall not pose unduly strict requirements or require the fulfilment of a certain condition not related to manufacturing or processing, as a prerequisite for the determination of the country of origin….rules of origin are administered in a consistent, uniform, impartial and reasonable manner’.[iv]

Guidelines in the EU treaties

treatylisbon

Article 8 of the Lisbon Treaty states that:

‘The Union shall develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness, founded on the values of the Union and characterised by close and peaceful relations based on cooperation.[v]

As the UK will become a new ‘neighbouring country’ after Brexit, the EU is compelled to deal with us according to the Article 8 terms.

WTO Technical barriers to trade Agreement

The TBT agreement is key – it means that signatories (again, including the EU) agree to abide by rules about international product and technical standards. From the European Commission’s website:

‘The TBT notification procedure helps prevent the creation of international technical barriers to trade. It was introduced by the Agreement on Technical Barriers to Trade (the TBT Agreement), a multilateral agreement administered by the World Trade Organisation (WTO). It gives participants advanced knowledge of new technical regulations or conformity assessment procedures envisioned by other countries. The EU’s participation in the TBT Agreement helps businesses in EU countries access markets outside the EU.’

Aim of the TBT notification procedure

To avoid any potential technical barriers to trade, WTO Members submit national legislation at draft stage to other members of the TBT Agreement. They can then assess the impact on their exports and identify any provisions breaching the Agreement.

While allowing all WTO Members to maintain their right to adopt regulations, the TBT Agreement aims to:

  • prevent the creation of unnecessary and unjustified technical barriers to international trade;
  • prevent the adoption of protectionist measures;
  • encourage global harmonisation and mutual recognition of technical standards;
  • Enhance transparency.[vi]

The commission somewhat downplays the TBT agreement, however. What it actually states is that:

‘Members shall ensure that in respect of technical regulations, products imported from the territory of any Member shall be accorded treatment no less favourable than that accorded to like products of national origin and to like products originating in any other country.

‘Members shall ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade.

‘Where technical regulations are required and relevant international standards exist or their completion is imminent, Members shall use them, or the relevant parts of them, as a basis for their technical regulations. Members shall give positive consideration to accepting as equivalent technical regulations of other Members, even if these regulations differ from their own, provided they are satisfied that these regulations adequately fulfil the objectives of their own regulations.’[vii]

Since UK regulations and standards will be equivalent to their EU counterparts from day one, and will continue to meet international standards going forward, it will be extremely difficult for the EU to reject UK products sold into the EU market.

WTO Trade Facilitation Agreement

The most recent agreement, the WTO Trade Facilitation Agreement (TFA) will further increase trade co-operation.

As the WTO website states:

‘The TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit. It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues. It further contains provisions for technical assistance and capacity building in this area.’[viii]

Perhaps especially important for Northern Ireland post-Brexit, the TFA also states that:

‘Each Member shall ensure that its authorities and agencies responsible for border controls and procedures dealing with the importation, exportation, and transit of goods cooperate with one another and coordinate their activities in order to facilitate trade.

‘Each Member shall, to the extent possible and practicable, cooperate on mutually agreed terms with other Members with whom it shares a common border with a view to coordinating procedures at border crossings to facilitate cross-border trade.’

The WCO welcomed the ratification of the TFA agreement in their press release of 22 February 2017, in which they wrote:

‘The World Customs Organization (WCO) congratulates the World Trade Organization (WTO) on the entry into force today of the WTO Trade Facilitation Agreement; an agreement that will expedite the movement, release and clearance of goods, including goods in transit, and which sets out measures for effective cooperation between Customs and other authorities, as well as provisions for technical assistance and capacity building in this area.

‘The WCO takes this opportunity to highlight that it will continue to seek improvements throughout the global supply chain to obtain the highest levels of safety, security and integrity, which will enhance trade facilitation for compliant actors. This will ultimately have a positive effect on the relationship between all border agencies and the Private Sector.

‘The entry into force of the Trade Facilitation Agreement (TFA) is an important milestone for the international trade and Customs community, coming about as a result of the fact that it has been ratified by 110 WTO Members, which pushes it above the threshold needed to take effect, namely ratification by two-thirds of the WTO’s 164 Members.’[ix]

In conclusion:

  • The volume and UK and EU will likely at least sign a basic goods FTA; meaning tariff-free goods trade will continue.
  • The UK’s rules and regulations are already synchronised with EU regulations and standards. This will also be true on the day after Brexit.
  • The UK and EU are signed up to the WCO, which exists to help simplify and resolve customs issues.
  • The WTO TBT agreement prohibits the EU from banning UK goods that meet international standards.
  • The WTO agreement on Rules of Origin means that the EU will have to ensure rules of origin are administered “in a consistent, uniform, impartial and reasonable manner” when dealing with exports from the UK.
  • The WTO Trade Facilitation agreement means the EU must co-operate with the UK on issues around the “movement, release and clearance of goods”.

When we combine these factors together we see that after Brexit, UK trade with the EU will be very similar after Brexit as before Brexit.

The EU has signed up to many agreements and treaties which in effect reduce the uniqueness of the single market.

Britain can therefore essentially have almost duplicate trade relationship by falling back on these international agreements (if necessary) which would mean that the UK could have the majority of the benefits of Single Market membership, but be free to choose which rules to obey when not exporting to the EU 27 countries or for domestic sale.

The TFA might not then be the final nail in the Single Market coffin (it is still useful to EEA members), but it is one substantial step towards reducing the importance of the Single Market to a post-Brexit UK.


[i] http://www.telegraph.co.uk/news/2016/06/13/not-only-can-britain-can-leave-the-eu-and-have-access-to-the-sin/

[ii] https://ec.europa.eu/growth/single-market_en

[iii] https://ec.europa.eu/taxation_customs/business/international-affairs/international-customs-cooperation-mutual-administrative-assistance-agreements/world-customs-organization_en

[iv] https://www.wto.org/english/docs_e/legal_e/22-roo_e.htm

[v] http://www.lisbon-treaty.org/wcm/the-lisbon-treaty/treaty-on-european-union-and-comments/title-1-common-provisions/6-article-8.html

[vi] https://ec.europa.eu/growth/single-market/barriers-to-trade/tbt_en

[vii] https://www.wto.org/english/docs_e/legal_e/17-tbt.pdf

[viii] https://www.wto.org/english/tratop_e/tradfa_e/tradfa_introduction_e.htm

[ix] http://www.wcoomd.org/en/media/newsroom/2017/february/wco-welcomes-entry-into-force-of-the-wto-trade-facilitation-agreement.aspx

This article first appeared on the Bruges Group website and is used with permission.

Keep the champagne on ice for a few more days!

 *** Post Script: Since this article was first posted on the website, it has been announced by a Downing Street spokesman that Mrs May will trigger Article 50 on Wednesday Week – March 29th. ***

Following Brexit developments since the memorable vote on 23rd June last year has been rather like watching paint dry. However, it does finally look like the long wait is over. The European Union (Notification of withdrawal) Bill has finally completed its passage through Parliament in its original form. The amendments proposed by the House of Lords were defeated in the Commons and now only Royal Assent is required.

Government sources have said that Mrs May will invoke Article 50 in the final week of March. A decision to do so straight away would be seen as playing into the hands of Dutch eurosceptic parties. A General Election is being held in the Netherlands tomorrow (March 15th) and Geert Wilders’ Partij voor de Vrijheid has been topping many recent opinion polls. At a time when accusations are flying here, there and everywhere about foreign interference in domestic elections, Mrs May will not want to give the EU any reason to accuse her of such behaviour, given the negotiations will be delicate enough as things stand.

Mrs May needs to steer clear of 25th March for similar reasons. This date marks 60 years since the signing of the Treaty of Rome, which formally established what has become the European Union. Celebrations are planned in Rome to mark the event and although the beginning of the Brexit will inevitably have to be fairly close to the festivities, triggering Article 50 immediately before March 25th would not win us many friends.  To  celebrate the beginning of Brexit at a time when EU-27 will be attempting to celebrate the European Union’s achievements against a backdrop of rising euroscpticism across the Continent would not be very good manners. Let’s face it, many of us who worked so hard to ensure our countrymen voted to leave the EU will surely want to crack open a bottle of champagne when the  formal departure process begins. Let’s keep it on ice for that bit longer. It won’t do us any harm.

Domestic politics also have limited Mrs May’s options. The SNP holds its Spring Conference in Aberdeen this coming weekend with Nicola Sturgeon threatening a second independence referendum following the Brexit vote. Mrs May has declared herself a strong supporter of “our precious union” and therefore wisely does not want to fan the flames of Scottish nationalism given that the result of a second referendum could be hard to call.

It is a relief, however, that the final obstacles in the way of triggering Article 50 have been surmounted. Then begins the hard graft. Unless both parties agree to an extension, we have to get a deal in two years which will enable our economy to function on day 1 of Brexit. There has been much posturing on the EU side, with talk of a big divorce settlement for the UK. It may turn out to be nothing more than a demand to honour our commitments to the end of the current seven-year EU budget cycle.

However, obstructive behaviour will benefit neither side.  If no agreement has been reached two years after Article 50 is triggered,  the Treaties no longer apply in our country and the UK and the EU would face a nightmare scenario in trying to relate to each other without any legal basis for so doing.

It is hard to imagine anyone wishing for such a calamity, but it is very apparent that our negotiators are going to have their work cut out to come up with a comprehensive settlement. Therefore, while we may be popping the champagne corks at some point before the end of March, it will be no more than a brief moment of light relief before the beginning of what is going to be a long, hard slog.