But we were told this couldn’t possibly happen!

German manufacturers last night demanded that Britain be allowed to continue trading with the EU without any barriers.
The car-making industry said punishing Britain makes no sense – and it called on the German chancellor to give the UK a favourable trade deal.
Eurosceptics have repeatedly argued it is not in the EU’s interests to bring in tariffs as the UK imports more from Europe than it exports, and any weakening of the British economy would also have a ripple effect on Europe.

50 thoughts on “But we were told this couldn’t possibly happen!”

  1. UK trade policy post-Brexit:

    1. We won’t impose taxes, tariffs or quotas
    2. We won’t subsidise any UK industries
    3. You can do what you like.

    Done and dusted in seconds. Ok, it might take a bit longer in reality (I imagine writing it on vellum is the work of a craftsman), but why do we need an army of lawyers?

  2. Yes, that’s my point too. There’s nothing to negotiate.

    To be frank, I don’t think the EU want to negotiate either, they just want us to fuck off. Which suits everyone except the proggie bedwetters who can’t accept that they lost.

  3. Bloke in North Dorset

    Whilst I agree on on tariff barriers I don’t think its that simple. The EU has gone too way far but some regulations are needed. Would we be willing for toy manufacturers to start putting lead back in to the pain they use, for example?

  4. Export manufacturers would have to comply with EU regulations, same as American regulations, Chinese regulations (if they have any) and so on. You just get a copy of the regulations and comply with them.

  5. Bloke in North Dorset

    Ian,
    I was thinking more about setting our own, minimal, regulations. We could say anything that complies with, say, EU or US regulations is allowed, but that would be imposing a cost that might not be needed.

    The EU has regulation about “sweatshop” labour that we might want to drop to help out those countries, as well as ourselves.

  6. “All this stuff about Leave voters wishing they hadn’t voted Leave is a myth.”

    Or a lie, as old-fashioned people call it. A fabrication concocted on Twitter.

  7. GD

    Agreed, that’s the backstop position, but it would be painful, too (and Remain would exploit the consequent job losses and try to re-open the whole issue).

    In any event, revealing your hand with your (1) would be naive in the extreme.

    The UK can afford to let the EU sweat. Juncker and Schulz want the UK out immediately, because that way they can punish the UK quickly before EU exporters insist on a better deal for the UK.

    The UK’s negotiating strategy should be:- ‘The EU exports c.£350bn-worth pa to the UK, while the UK exports c.£250bn-worth to the EU. The UK receives 16% of the other 27 EU nations total exports and is the fifth largest economy in the world. Either we get free trade without single market membership and without free movement, or we’ll slap tariffs on all your exports to the UK. Now, a trade war isn’t in anybody’s interests; but, if you insist on one, you’ll come off worst.’

    As Adam Smith recommended, a free trading nation should put up tariffs when faced with an aggressively mercantilist power.

  8. Adam Smith wasn’t that good on economics, particularly in value theory, and didn’t understand tariffs very well. He was also a customs man and rather liked them. He favoured the Navigation Acts. He gets far too much credit as a free trader, he was tepid at best.

    Bastiat was much better on this. Tariffs always hurt the country that imposes them. That’s why the USA’s economy went around the U-bend when they imposed a tariff hike at the start of the Great Depression to “protect their industry” and why Labour’s post-war trade controls which were meant to boost British industry (import substitution FFS!) left us impoverished and rationed while free trading Germany experience an “economic miracle”.

    Don’t get into a trade war. If the EU tries tariffs, more fool them.

  9. Bloke in North Dorset

    Junker and Schulz should be told to fuck off and we’ll choose are own strategy and timetable.

    All that’s happened is that we’ve had a referendum and told our Government what it already knew from opinion polls. Until we either invoke article 50 or repeal the 1972 EEC act we’re full members of the EU with all the same rights.

  10. Selected tariffs are all that is required to get a decent deal; 150% tariff on French wine, 50% tariff on German cars, 80% on Italian clothing, 5% on whatever Greece produce etc.

    Just choose one key industry for each country and leave it at that as the threat. Especially easy when the goods can be substituted without too much hardship on Brits.

  11. Don’t mix up standards and regulations. To sell in any market you have use the applicable relevant standards or in some cases internationally accepted equivalents. Many British standards (BS) were adopted into the Eurapean standards verbatim and became BS-EN standards, there is the International standards (ISO), there are many American standards, Indian standards tend to follow the old BS standards, Australia has its own etc etc.

  12. Cal gets it, while IanB (as so often) manages to miss the point.

    The ideal outcome for a post-Brexit UK is free trade (outside the single market) with a passport for the City. We ain’t going to get that if we say at the outset that we will never erect any tariffs. We need to threaten the EU with tariffs (and be prepared to implement them) or we will be done over completely. With the rest of the world, we can engage in free trade until the EU comes to its senses.

  13. Trade wars happen because threats escalate. Nobody wants to give in first. Threaten their wine etc, they’ll threaten key industries and so on and so on. It’s the Feud System; you start off with somebody spitting at somebody else and you end up with clans massacring each other. But that’s enough about Scotland.

    Just say “we will raise no barriers, we’re free traders” and let them do what they like.

    We should be focussing on pulling more states out of the EU and into free trade. We should act on the assumption that the EU is doomed and long negotiations are a waste of time. We’re in a position of strength, but everyone is so timid they want to act as if we are weak.

    If you discourage somebody from selling to you, you’re just hurting yourself.

  14. Tariffs bring forth smuggling.

    If the British state looked the other way many sizeable enterprises could rise in this country to help EU victims buy British goods at cheaper prices. Goods are generally easier to smuggle than people. There is plenty of the latter going on.

    Even more so if we can produce goods without EU imposed costs or bring goods from other lands that also have EU tariffs slapped on them and tranship to Europe at lower prices. Getting rid of-or at least massively reducing VAT would make our goods still less expensive. The extra effort of smuggling would boost costs but smuggling has always shown a profit historically.

  15. “Never threaten something you don’t want to do.”

    What Theo said. We will implement them if we have to, even if we’d rather not.

  16. If we implement them, we damage our own economy. If you want to re-run the Great Depression, go for it.

  17. James in NZ,

    “Just choose one key industry for each country and leave it at that as the threat. Especially easy when the goods can be substituted without too much hardship on Brits.”

    I tried to persuade the more sensible remain types with the figures that global trade is growing a lot faster than EU trade.

    I caught a video of Digby Jones yesterday thinking the same thing as me. The EEC was the UK’s economic area, roughly, in the mid-1970s to about the mid-90s. In 1999, 55% of UK trade was with the EU. It’s now 43%. Fall of communism, container ships, aircraft, global development and internet shrunk the world in the same way that railways and roads shrunk Europe after the war.

  18. Plus, remember that the EU must know very well that any trade war with us (or anyone else) will plunge their woefully fragile Eurozone economy into a crisis it cannot stand.

  19. Call me whatever names you like. I am ideologically delighted to be leaving the EU. But if we don’t get a passport to sell financial services to the EU then we are fucked.

  20. We will, so long as we don’t do anything stupid like threatening a trade war. They cannot afford to be vindictive. Neither can we. It’s clear already that they just want us out and the whole thing settled with the boat rocked as little as possible.

    There is a good chance that our demonstrably shambolic political class will fuck it up, of course.

  21. “If we implement them, we damage our own economy.”

    But not as much as we would if we let the EU walk all over us.

    The point of implementing trade barriers in such a situation is that before long the EU will realize that they are damaging themselves too, and then we renegotiate to get rid of the barriers. If you look at the export figures they depend on us more than we depend on them. There is no way that business in Germany will allow the EU to get away with tarrifs, etc. on UK goods for long, there’ll be mass bankruptices. (In fact, German business is already calling for a free trade deal with the UK today.)

    In reality, it is unlikely to come to that, once the EU sees that you’re prepared to screw them if they screw us then they won’t impose the barriers, but that only works if they think you’re serious.

  22. @Bind,

    As for lead in paint on kiddies toys, surely the buyer should beware? Every consumer is responsible for what they buy – and should run the full battery of safety tests on every single item they buy for themselves or their family.

    We need a bonfire of regulations. Along with the lead bans, we should get rid of the ludicrous requirement for pen caps to have air holes in them – time for some more Darwinism in my book.

  23. And if a duff product from a multibillion multinational harms your child, you can seek redress through the courts. Easy innit? A. N. Other v GlobalMegacorp Inc. No problem!

  24. If you threaten them, they are in the position of not wanting to lose face. Offer the unilateral free trade up front, you’ve never put them in that position.

    Don’t start the tit for tat.

  25. “Offer the unilateral free trade up front, you’ve never put them in that position.”

    Of course you offer the free trade up front. You only say you’ll implement barriers if they do. You make it clear for the outset that you think the best option for all parties is a free trade deal. It’s only if they get arsey and say we’re going to do X to you that you say ‘In that case we’ll do X as well to you’.

  26. If someone puts a gun in your face AND instantly pulls the trigger then you are fucked Charlie. If they don’t shoot at once it is because they want something else or are hesitant to kill and you still have a chance to turn the tables.

    Financial problems do not= being fucked even should they be as bad as your fevered imagining.

    The Germans and Japs and South Koreans dragged their war-blasted and all but ruined (really ruined) nations back to prosperity. The Chinese-although not yet fully free of socialist shite have done miracles. Large swathes of the 3rd world have started with nothing and are on the way up.

    We will-regardless of doom and gloom bullshit–not merely survive but achieve real and lasting prosperity . Not a series of bogus bubbles and disaster orchestrated by bureaucratic buffoons.
    “Nothin is fucked here Dude–nothing is fucked”

    And if you think about it Walter was correct–despite the Dude’s “They’re Gonna Kill That Poor Woman” angst–nothing was fucked.

    “What about the fucking petition?”

    “Forget about the fucking petition Dude–You want a petition? I can get you a fucking petition by this afternoon. With nail polish. There are ways Dude. You don’t want to know about them”

  27. Yes Biggie–think of the literally billions of lives saved by air-holes in pen tops!

    Because avoiding a one in a million chance of tragedy is so obviously a reason to have millions of bullshit regulations from dictatorial, feather-bedding pricks.

    And further promote that authoritarianism that has done so much for humanity throughout its history.

    And if there weren’t any pens there wouldn’t be any kids dying from pen tops. So lets ban pens altogether. They are probably only used to write-anti-EU propaganda anyway.

  28. Aren’t tariffs a bit like nuclear weapons? You have them to deter others from using theirs on you, and your threat to use them has to be credible.

  29. Impose a 150 percent tariff on french wine and the french still sell us wine.
    Lots of people buy something because they want that. Can find cheap wine easily enough – why do supermarkets stock lots of higher priced wine? Because people buy it.
    Same with other stuff.

  30. Bloke in North Dorset

    “Bemused
    June 27, 2016 at 10:26 am

    Don’t mix up standards and regulations. To sell in any market you have use the applicable relevant standards or in some cases internationally accepted equivalents.”

    In the case of lead paint in toys they are one and the same. If a country allows lead in toys and we have a standard that says it isn’t we have effectively created a trade barrier for that country’s toy manufacturers.

    @BiG,

    I know you’re trying to make a point, but I’m not a Consequentionalist on this (most) issues for the simple reason that it wouldn’t survive 1st contact with Mumsnet and that would play straight in to the hands of the protectionists.

  31. about financial passporting and “The City”

    Tim probably knows more about this than I do …
    …since NY, S’pore, HK, Shanghai, and Chicago etc financial institutions will be able to offer financial products into the EU when MiFid2 kicks in (in) 2017 or 2018 why wouldnt London institutions qualify under that same MiFid2 legislation?

  32. ‘Because avoiding a one in a million chance of tragedy is so obviously a reason to have millions of bullshit regulations from dictatorial, feather-bedding pricks.’

    The public becomes comfortably numb, not having to worry because Government Inc is looking out for them. The public then raises generations of dumbasses, cos you don’t have to be able to think.

  33. Not just Smoot-Hawley. The Tariff of Abominations and the Morrill Tariff had deep impact on the U.S.

  34. Advice please. Everyone seems to be arguing about free movement which is part of the single market if we adopt EEA or EFTA. I know FTAs were being worked out with Canada CETA and ASIAN I think. These were supposed to strip away 99% of tariffs and I guess free movement is not part of those deals.
    So do we enough leverage (and boldness) to ask for a bespoke EEA but replacing free movement with a points system? Or is this where politics and hubris take over.

  35. “So do we enough leverage (and boldness) to ask for a bespoke EEA but replacing free movement with a points system?”

    Yes.

  36. IanB

    “If you want to re-run the Great Depression, go for it.”

    This sounds like Project Fear, again. And it’s bollocks. Threatening to introduce, or even introducing, a few selective tariffs – on (say) German cars – while the UK trades freely with the rest of the world, isn’t going to cause another Great Depression.

    Read what Cal says, and learn.

  37. Politics takes over. More than a million UK nationals are working in the EEA. They need to be protected too. The UK also has a duty to protect GIB, an inclination to please the Scots, and a desire to please the Irish.

  38. “Aren’t tariffs a bit like nuclear weapons?”

    Tariffs are a bit like stealing money from your own population, only legal. It’s about giving manufacturers protection from competition, enabling them to raise prices in the shops, in exchange for corrupt political favours. It’s legally granted partial monopoly power.

    So, we’re going to threaten to give *our* industries monopoly power to raise prices over our *own* population too, and that’s going to scare the EU into surrendering? Marvellous!

    “The point of implementing trade barriers in such a situation is that before long the EU will realize that they are damaging themselves too, and then we renegotiate to get rid of the barriers.”

    They never have yet. And they’ve been imposing trade barriers for decades. Imposing trade barriers is precisely what the EU is all about.

    For that matter, neither have we. Imposing trade barriers on the movement of labour has precisely the same effect. But some people seem to think we can keep our trade barrier in place, while expecting them to drop all theirs.

    But people are easily persuaded that it’s a good idea – it’s why protectionism is such a persistent problem.

    “Advice please. Everyone seems to be arguing about free movement which is part of the single market if we adopt EEA or EFTA.”

    Free movement is indeed part of the single market, but EEA members have the right to apply an “emergency brake” on any of the “four freedoms” in case of “serious economic or societal, or environmental difficulties”.

    See here:
    https://thebrexitdoor.com/2016/01/29/camerons-emergency-brake/
    http://www.adamsmith.org/evolution-not-revolution

  39. Again; free trade is the very well understood question of whether you apply restrictions to the movement of goods and services across borders. It has nothing to do with immigration, since people are not goods and services (hence the abolition of slavery, which treated peoiple as goods).

    Everyone seems to think we are in a position of weakness. We are not. The EU should simply be told that “free movement of people” is not on the table and we are interested in free trade. We do not need to be in any trade organisation for the time being and we do not need to submit to any rules.

    Trade is not people. Trade is the transfer of that which people produce. Entirely different things.

  40. And once again, labour is not people. Labour is something that people may spend part of their time doing. I spend about the same proportion of my life sleeping as I spend labouring. I don’t hear anyone talking about the free movement of sleep though.

  41. I agree Ian but with the pack of pricks still at the top good sense may not prevail.

    Polits and lawdogs aren’t going to seek out a free trade alternative– they just aren’t. And the general level of info on all sides about the possible modes of exit is low–in the “low-info voter” sense.

    They will try for a legalistic outcome and most people aren’t aware enough to call for an alternative. If we could make the bastards have total, “agreement free” free trade I ‘d be the first to support it. Short of another mini-campaign–whose issues would be complex to get over to the public–I can’t think of any way of forcing the poli-scum to do it the sane way.

    Below is a piece from North.

    I would value your thoughts about it. It might be the biggest step to freedom that is actually do-able
    .
    http://eureferendum.com/blogview.aspx?blogno=86122

    I think it achieves most of what we are after without giving too much back.

    Again I would love to be the delegate from the UK fronting the EU negotiators with “free trade/limited free movement–take it or leave it” but that isn’t going to happen.

    Likely it will be Blojo and something that limits his ability to do a sellout and gets us most of what we voted for is as much as is doable for now.

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