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EU Referendum

Bremain? No, the EU is an economic basket case says top author as he reveals the history of Europe’s money troubles

It was quite like old times last week, with Ministers hailing disappointing growth figures as proof positive that the UK ‘needs’ to be a member of the EU.

For Chancellor George Osborne, the data did not cast doubt on his competence – rather it bolstered the Bremain case because ‘the threat of leaving the EU is weighing on our economy’.

The idea that Britain is economically incapable of surviving outside the maternal embrace of the EU has a long pedigree.

It is based on the idea that member states outperform non-members, and that this is especially true regarding the UK.

The idea that Britain is economically incapable of surviving outside the maternal embrace of the EU has a long pedigree, writes Dan Atkinson 

For a long time it was indeed the case, and in the 12 years that separated our first application in 1961 to eventual membership of the European Economic Community, the UK was desperate to join what was seen as an elite club.

It is easy to see why. Between 1950 and 1961, the six Community founders – France, West Germany, Italy, Belgium, the Netherlands and Luxembourg – saw total economic growth of 80 per cent, against under 30 per cent for Britain.

As the Sixties swung, income per head in West Germany rose by three times the rate in the UK. France, Italy and Belgium also grew faster.

The Common Market, it seemed, was the incubator of economic miracles. Yet even after joining, Britain seemed incapable of a similar transformation.

George Osborne warns that Brexit would lead to higher taxes

On television in 1976, a youthful David Dimbleby pressed Denis Healey, the then Chancellor, as to when a ‘British miracle’ could be expected.

Very soon, declared Healey, shortly before the UK had to be bailed out by the International Monetary Fund.

Resurgent inflation at the end of the 1980s prompted an attempt to latch on to the credentials of the German mark – namely our short-lived membership of the Exchange Rate Mechanism (ERM).

This was to be the peak of Britain’s ‘economic cringe’ in the face of European superiority.

ERM membership was disastrous, prompting a wave of business failures and home repossessions.

But if the EU was still enviably successful, things were about to change, and radically.

The author adds: 'It was quite like old times last week, with Ministers hailing disappointing growth figures as proof positive that the UK ‘needs’ to be a member of the EU' 

Researching our book Europe Isn’t Working, my co-author Larry Elliott and I were struck by the almost indecent haste with which leaders such as Francois Mitterrand, Helmut Kohl and Jacques Delors led the charge to European economic, monetary and political union.

Far from there being any proper stock-taking as to the strengths and weaknesses of the Community, there was a stampede towards the Maastricht Treaty, which established the European Union.

The most visible manifestation of the EU is the euro, the currency without a country that has proved a disaster, with endless crises and bailouts.

Unemployment in the eurozone is 10.3 per cent of the workforce, against just five per cent in Britain.

In 1975, the last time we voted on EU membership, the Yes leaflet said of the other Community members: ‘They have done well – much better than we have – over the past 15 years.’ That is one claim that truly cannot be made this time.

In the absence of continental economic superiority, what is the reason to Remain?

Europe Isn’t Working by Larry Elliott and Dan Atkinson is published by Yale University Press

http://www.dailymail.co.uk/debate/article-3567665/No-EU-economic-basket-case-says-author-revelas-history-Europe-s-money-troubles.html

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