This book is pitched as a straight-talking “explainer” from the Public Policy Editor of the Financial Times that “dispels the myths” about Brexit. With “clear-headed practicality”, he wants to help us “move on” by outlining a “better future for Britain” and not “re-litigating the referendum”.
Foster is easily distracted. The first two-thirds of his book re-litigate the referendum. This reads like old newspaper articles stitched together: a punning headline; an arresting statement; an anecdote about Kiran from Hampstead or Sam from Doncaster, with quote about how life is impossible after Brexit; £x here, $Y there, a Z per cent; then a mini-summary and a punchline. Wearingly, the same claims and statistics are repeated all the time
One point is hammered home. Brexit must be bad for Britain, because the UK’s Trade Openness, i.e. (exports + imports) divided by GDP, was “much lower” in 2022 than in 2019. Foster never gives the actual score for either year, but frequently asserts that, in violation of all those referendum promises, post-Brexit Britain is “less open” to trade.
As I write, the official ONS trade data for 2022 (“the Pink Book”) has not been published. Foster is cribbing a February 2023 report from the Resolution Foundation which used OECD data. Its argument was that Brexit made the UK recover more slowly from Covid than its major competitors. To do so, those authors had to leave out significant UK precious metals exports as “notoriously volatile” (which Foster concedes in passing), but still admitted “the UK is not performing as badly as many feared” and was becoming “more open”, in defiance of “the consensus” (which Foster omits).
According to OECD data, the UK had a Trade Openness for 2022 (76.3 per cent) that is not only higher than the score for 2019 (64.4 per cent) but the highest of any year since the end of the Second World War.
ONS data up to 2021 is also illuminating. UK Trade Openness fell steadily from 2011, then after 2016 spurted upwards. 2019 has the so-far highest recorded ONS score. How odd, that Foster should select abnormally high 2019 as his benchmark.
After the referendum, sterling depreciated significantly, with the markets pricing in a No Deal Brexit. The UK could undercut competition and sell more exports, whilst still inside the EU. 2017–2019 is the best three-year period on record for Trade Openness. We had to vote to Leave to boost our trade.
Hamstrung by Boris Johnson’s “fraudulent” exit deal, then crippled by Covid, in 2020 and 2021 the UK earned Trade Openness scores of 58.5 and 58.6 per cent. Those results are higher than the UK’s scores for 38 out of the 47 years during which it was inside the EU.
Personally, I believe Trade Openness is a poor guide to economic performance. Nonetheless, Foster chose it as his metric of the badness of Brexit, and the figures are the opposite of what he claims. It took me half an hour to find and analyse the data I have cited (www.stats.oecd.org; ONS data series YBHA, KTMW, KTMX). Foster could not manage that in a 178-page book.
Our businesses are capable of expanding sales to customers outside the EU
Our author displays curious blind spots. Principally, he regards the EU exclusively as a trading arrangement. EU institutions exist purely to facilitate trade, and their demands whilst negotiating Brexit were obvious requirements of any trade deal. There is no recognition that the EU is a unique trading association, or that some demands (to treat the UK as if it were still a member) were not only unusual in the context of most trade deals, but when compared to the EU’s negotiations with third countries.
At the same time, Foster mocks UK ministers for failing to realise that, outside the EU, trade deals involve trade-offs and cost political capital, as they are subjected to scrutiny. Did not joining the EU involve trade-offs? Who was scrutinising the deals which the EU was entering into on our behalf?
Foster concedes that rejoining the EU is not feasible. Instead, we should re-engage sector by sector. His advocacy of signing up to specific EU regulations in turn looks very like the “cherry-picking” he denounces in Brexiteers. It risks the worst of both worlds, not obtaining much quid for our quo.
He wants to eliminate “damaging instability” for business. He means the potential for UK legislation to change after a General Election. Yes, democracy is flawed that way. The EU can change its own legislation, too, though. Brussels issues new directives at quite a rate. Apparently, business can cope with that.
The book’s rationale is that the UK is dependent upon the EU because 50 per cent of our exports go there. Foster treats this as an unavoidable fact of life. It only became true in the 1990s, however. Despite enlargement, the aggregate EU share was trending downwards well before Brexit. In recent decades, the Common Market countries we originally joined have purchased around one-third of our exports, about the same level as they did before 1973, with a marked rise and fall in between.
Trade patterns change. In bashing Brexit for crippling the country, Foster observes that food and drink exports to the EU are lower than in 2019, whilst those to the non-EU have grown by 17 per cent. You see: our businesses are capable of expanding their sales to customers outside the EU.
Will Brexit leave the UK worse off? Possibly. The Russo-Ukraine War caused more immediate damage and Covid greater consequences, though. A Corbyn Government would have been worse still, inside the EU or out. Following Foster’s prescription to avoid short-term cost whilst ignoring longer-run hopes, nobody would ever get divorced, make a risky investment or buy a motor car. The human race must be a terrible disappointment to Foster.
This book is not a serious examination of the best way forward after Brexit. It is a lazy series of talking points for nice people at dinner parties. I look forward to reading Foster’s next article exposing the dodgy statistics used by the UK government, or the flimsy data basis for its latest policy.
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