Timmy elsewhere in The Guardian

Hard Brexit need not make us worse off
If we unilaterally declare free trade we will be richer, says Tim Worstall of the Adam Smith Institute

‘Brexit offers us the opportunity to charge ourselves nothing for our purchases of the goods and services of the world,’ says Tim Worstall. Photograph: Chris Ratcliffe / Rex Features

You report (4 November) on how Brexit will raise the cost of living by as much as £930 per year for a household, based on research published in the National Institute Economic Review. There is a certain logical problem with this assertion.

It is entirely true that under WTO terms we must charge the same import tariff to all other members of the WTO – essentially, the rest of the world. This is known as “most-favoured nation” (MFN) status. The WTO lays out the maximums these can be, any country being at liberty to impose something less, including a rate of zero.

Your report and the research it is based upon assume that we will charge the maximum permissible rates. But as this research points out it is we, as consumers, who pay such import tariffs. They increase the price of the imports we purchase – to the point that if we imposed maximum WTO tariffs then each British household would be as much as £930 a year worse off.

Yes, obviously, politics is involved here – but even so, why would we do something as blitheringly stupid as making ourselves poorer in this manner? The entire point of trade itself is to gain access to those imports of the things that foreigners make better or cheaper than we ourselves do. The only rational trade stance to have is thus unilateral free trade, which this country experimented with, most successfully, after the repeal of the Corn Laws. Brexit offers us the opportunity to do that again – to obey the WTO insistences on MFN status and charge ourselves nothing for our purchases of the goods and services of the world. As other research has shown, this will make us all richer, not poorer.

Tim Worstall
Senior fellow, Adam Smith Institute

17 thoughts on “Timmy elsewhere in The Guardian”

  1. Only a far right neo-liberal could propose failing to impose and collect maximum import duties to help fund the Government on which we all depend for the provision of important public services.

    On Brexit we should erect signs at all UK entry points to make this clear to a grateful public:

    “Steurn Macht Frei”

  2. Exactly right. We should all pay tax and duties to fund the state. It is our responsibility to pay as much as possible, cf panama and paradise papers, without any consideration of whether the money is well spent, cf ignoring benefit fraud as it is “only” a billion or so and ignoring NHS tourist costs as it is “only” a few billion and ignoring the vast cost of public sector pay as you go pensions etc etc

    The narrative is a left wing one through and through. Maybe we can alter it? “Brexit will fund and additional £930 of government expenditure per household in the Uk (minus overhead and associates costs so probably £200 net)”

  3. Because the brexit voters want market protection?

    I mean, I agree the more sane among the leading brexiteers would grok your point utterly, but try selling it in Sunderland to a Brexit voter who expects his job to be protected.

    Whatever the Brexit end result, it clearly is going to give the voters what they wanted, good and hard.

  4. Bloke in Costa Rica

    BraveFart: did you mean Steuern? That would make more sense than “pilot (nom. sing.) set (3 pl. pres. ind. act.) you free”.

  5. “Whatever the Brexit end result, it clearly is going to give the voters what they wanted, good and hard.”

    Don’t delude yourself–well any more than usual–Biggie.

    The voters didn’t vote for Brexit to put money in their pockets–tho it will despite the efforts of the Fish Faced Cow and her gang. We voted for freedom and our country back. You are mixing us up with your greedy cash-sucking boomer mates who would sell out their Granny and themselves for a cash payoff. And/or to signal what virtuous cucks they are.

  6. BiCR

    Oh fvck, trying to be too clever.

    Yes Steuern as in “taxes make you free” in homage to Murphy’s holiday trip to Dachau or whichever death camp it was he visited and then made a rather crass blog about it.

  7. @Bravefart

    I’d have said “Steuer macht frei”.

    It’s rather “tax” as a general concept rather than “taxes” in specific. But maybe I’m over-thinking the nuance there…

  8. Sadly, it seems that the government is not listening Tim From the Guardian article:-

    “The UK has decided to adopt the existing EU tariff schedule agreed at the WTO in order to simplify and speed up its ability to continue trade with the rest of the world after Brexit.”

  9. Slightly OT, but government’s blind embrace of bureaucracy:

    http://www.cfact.org/2017/11/05/much-to-do-in-bonn/

    ‘The US has said they will quit the Accord. But officially getting out takes several years and in the interim the US is still a big part of the negotiating body.’

    ‘The key point here is that this Paris thingy is not a treaty. President Obama signed off on it all by himself. President Trumps says he is opting out. In no case has the Senate advised or consented, as the Constitution requires for treaties. So if this “pact” is some sort of Presidential agreement then the President’s team needs to step up to the plate and swing big.’

    Why the heck would getting out take several years?

  10. Bloke in North Dorset

    Gamecock,

    I don’t know how it affects your constitution but Paris was an “accord” not a treaty. From a rather worrying article about US States and green organisations taking companies to court:

    The Paris accord is playing a role. Like many environmental treaties, it does not bind signatories to fulfil their obligations, merely enjoins them to do so. But plaintiffs can assess governments’ and firms’ actions against the 2°C goal.

    And

    Mr Heede’s calculations, which most scientists accept, mean that responsibility for past and future warming can be apportioned—at least in principle. Mr Lliuya’s claim of €17,000 ($19,800) against RWE corresponds to 0.5% of the cost of protecting his town against the glacial melt. That 0.5% is the utility’s estimated share of cumulative global greenhouse-gas emissions, chiefly from all the coal it has mined. Likewise San Francisco, Oakland and three other Californian counties have sued dozens of carbon majors, including BP, Chevron, ExxonMobil and Royal Dutch Shell, for damages proportional to their share.

    Its pay walled but worth a read.

  11. What’s German for “Fuck off Murphy, you fat cunt”?

    It would be worth hanging a banner saying that on the gates if Murphy ever went back to Dachau.

  12. abacab: I’d have said “Steuer macht frei”.

    Yes indeed although Murphy’s perspective is perhaps more accurately given as: “Besteuern macht frei”.

    Still, bravo to BraveF for echoing the Dachau Leitmotiv and für’s Deutsch.

  13. Hang on a minute – if UK gov insists on keeping previous EU tariff rates for imports from outside EU doesn’t that mean that the Treasury is quids in as previously tariffs went to EU coffers or have I misremembered?
    On the other hand by implication from numbers above if tariffs were to be dropped then this would mean a sizeable one off fall in rate of inflation with a variety of knock on implications.

  14. Why does anyone think the EU will not use other measures to impede trade with the UK if we unilaterally cut tariffs to zero?

Leave a Reply

Your email address will not be published. Required fields are marked *