IEA agenda has excluded it as a serious player in the Brexit debate

The announcement by the Institute of Economic Affairs (IEA) of its finalists for the €100,000 Brexit prize was made this week.

It was noteworthy for this blog as the entry by my friend Richard North, assisted by another friend, Paul Williams, regretably did not make the final six – despite producing a submission of incredible detail, that presented a solution for a post-EU Britain based upon real world dynamics, governnance and structures.  You can read the submission, ‘FLEXCIT’ here.

A closer look at the entries that survived showed the authors all share a common theme, namely that Brexit should be accompanied by a formalisation of a Commonwealth free trade bloc.

What is interesting is that the original shortlist of 20 included a number of entries espousing variations of British membership of the European Free Trade Association (EFTA) upon exit from the EU.  But in whittling down the field, every single one of them has been culled, while entries pushing a Commonwealth solution, or written by people who push such a solution, have made it to the final.

The only possible explanation for this is that the judging panel have abandoned any pretence of embracing wide-ranging and innovative solutions in an open minded fashion, and instead sought to advance entries that mirror their own pre-determined viewpoints.  In short, that the IEA Brexit panel are only interested in entries that reinforce and confirm their own biases, which renders the whole IEA competition worthless.

So why can the IEA no longer be considered a serious player in the Brexit debate?

Put simply, when combined with the wholesale exclusion of the overwhelmingly political dimension of a Brexit,  it is that in the modern age the Commonwealth solution is no longer a realistic option.

Free trade blocs requires its members to have broadly similar standards and have similar levels of social development.  The is such a difference in standards and social development between Britain and, for example, Uganda, that the notion of the Commonwealth being a suitable wrapper for a free trade bloc just doesn’t stand up.

The IEA has ignored the real world in favour of a concept that would be unworkable and costly.  It has pretended the politics of Brexit are irrelevent and that economics trumps all.  As such it cannot be taken seriously and any interventions it makes in the debate concerning the UK leaving the EU are likely to cause more harm than good.

10 Responses to “IEA agenda has excluded it as a serious player in the Brexit debate”

  1. 1 Clarence 31/03/2014 at 3:00 pm

    Tuvalu, Seychelles, Lesotho, Pakistan, Mozambique, Rwanda, Samoa… are these the places that the IEA has in mind when it bleats about the Commonwealth?

    It’s very disappointing that Dr North did not win but god knows the anti-EU movement is vastly enriched by his Flexcit document (link above, in main story). The document is the antidote to any amount of FUD.

  2. 2 Autonomous Mind 31/03/2014 at 3:41 pm

    Could not agree more with you Clarence. Richard has done a fantastic job.

    Sadly though you won’t see UKIP making use of it. It’s more than 250 words long so therefore too difficult for them to digest while standing at the bar.

  3. 3 theboilingfrog 31/03/2014 at 5:06 pm

    Many thanks AM. It’s hugely frustrating I have to say that a detailed and well-worked strategy put forward by Richard to leave the abortion that is the EU is ignored by the main so-called Eurosceptic party.

    Criticising the EU makes shooting fish in a barrel look like a fiendishly difficult game – it is utterly indefensible – why can’t UKIP manage to get it right?

  4. 4 Richard North 31/03/2014 at 7:25 pm

    Blogged … As it stands, we have no reasons to be confident in either their [the judges] grip of the issues or their impartiality …

  5. 5 Spinwatch 31/03/2014 at 9:22 pm

    “Free trade blocs requires its members to have broadly similar standards and have similar levels of social development. ”

    On what evidence, please? In the EU, can Sweden, Denmark and Finland truly be compared with Rumania, Greece, Cyprus and Spain?

    In NAFTA, does Mexico have similar standards and social development to Canada?

    In ASEAN, is Myanmar (Burma) with one of the world’s lowest human development index ratings on a par with sophisticated Singapore?

    All that free trade blocs really need is agreement to trade with each other and accept the rule of law through a common arbitrator?

  6. 6 Richard North 01/04/2014 at 12:40 am

    @spinwatch – if you were less keen to rush to comment with your challenge, you will see the reference in the piece to a learned paper, which provides the evidence you seek. And you will also find that my argument posits a successful free trade bloc. Much of what passes for free trade is not, as the decline of tariffs has seen the emergence of NTMs which impose greater costs than the tariffs they replace.

    Thus, do spare me your simplistic mantras and read what I have written. Then look at “Flexcit”, from which the argument derives.

  7. 7 Spinwatch 01/04/2014 at 2:48 pm

    @ Richard North
    Thank you for the reply. By coincidence I have seen something on your website
    “Free trade blocs, he writes, require its members to have broadly similar standards and have similar levels of social development. There is such a difference in standards and social development between Britain and other members, including Uganda, Rwanda, Pakistan, India, Canada and New Zealand, that the notion of the bloc being a suitable wrapper for a free trade bloc just doesn’t stand up.

    The essence of a modern free trade area is a common rule book, setting out a wide range of standards, a reliable dispute system and, all importantly, uniform and effective enforcement.

    Where there are major differences in social development, however, the introduction of common standards kicks in a phenomenon known as “regulatory hysteresis”, explained in some detail in this paper.

    Click to access CHL%20Enforcement.pdf

    What is absolutely necessary in a free trade area – as between EU countries in the EEA – is a convergence of regulatory systems, brought about by standardisation of law and uniform enforcement. ”

    My concern is that, as far as I can see, the Berkeley learned paper that you quote refers to the fairly specific fields such as securities regulation in capital markets?

    The ‘Flexcit’ paper only mentions economic ‘hysteresis’ once, citing the Berekely learned paper.

    Is there any supporting evidence that the latter’s conclusions on differences in social development are relevant to wider markets such as non-financial services, hi-tech goods, etc?

    If not, maybe AM could further explain the reasoning behind the comment:
    “Free trade blocs requires its members to have broadly similar standards and have similar levels of social development”.
    which, as my earlier comments have shown, I find counter-intuitive?

  8. 8 Richard North 01/04/2014 at 6:55 pm

    @Spinwatch In the Flexcit paper I was limited to 20,000 words to cover the entire territory. Having established the principle, I allow the readers to use their own knowledge, imagination and experience and apply it to other sectors, in the certain knowledge that they will understand that what applied to enforcement in one set of circumstances will almost certainly apply to others. Although, the paper applies to particular sectors, the enforcement scenario has general characteristics which should apply cross-sector.

  9. 9 Spinwatch 01/04/2014 at 7:51 pm

    @ Richard North
    Thanks for the clarification. I respect that you were limited for length.

    One could argue that the EEA or EU is as much a mismatch as the Commonwealth, although I note that your essay has an innovative proposal to replace the EEA / EU with a better model of regulation. I shall study it with interest.

  10. 10 Richard North 01/04/2014 at 11:20 pm

    Yes! I do not regard EEA as final cover, and yes, as between, say, Romania and Norway, there is a huge mismatch. In fact, I am not a fan of all-embracing FTAs. I’d sooner look to sectoral and sub-sectoral deals. They seem to be more capable of delivering results.

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