The EU has decided to defer the latest round of negotiations for two months. Apparently, we are to stand with our faces in the corner because we aren’t discussing the Brexit Bill. Whether this deferment will continue is a key question that needs to be answered, otherwise we face the risk, not of us leaving without a deal, but rather being pushed out, without a deal. The latter is clearly self-damaging to the majority of European citizens, and cannot in any way be considered as helping Europe. It is in nobody’s interests to operate on WTO rules with a hostile relationship: For if love covers a multitude of sins, hate must surely uncover a multitude of loopholes.
A point has been raised many times that the World Trade Organisation’s rules apply only to goods, and not services. This is a misunderstanding. In the late 1980s and early 1990s, the Organisation passed its first regulations on the trade in services, which had been exponentially growing. The resultant treaty was called the ‘General Agreement on Trade in Services’ or ‘GATS’ and was one of the proposals ratified during the meetings in Uruguay. While this is a point not directly relating to the centre of the article, it does prove that much of Britain’s traded economy is regulated under WTO agreements. Therefore, although WTO rules are not the best rules we can use for trade, they are not by any means insufficient, and are capable to protect and police UK trade with the rest of continental Europe, be they inside or outside of the EU’s Single Market.
Yet while Mr. Barnier would appear to be threatening the UK with the spectre of making life and trade extraordinarily difficult, he fails to realise if he was to go through with this idea, he is acting in a way similar to another European federalist with a surname also beginning with the letter ‘b’: Bonaparte
In 1811, the UK faced a similar conundrum, made all the more concerning by Emperor Napoleon’s military aggression. Europe was in an uneasy peace under French hegemony, but Britain refused to accept these terms, and continued to financially support their enemies Prussia and Austria. Napoleon, along with his allies and puppet states, decided to strike back against the British economically. The British had continually funded his main enemies in Europe, and had made his hold on European power insecure. Knowing that the British strength lay in their wealth, and their wealth in their trade, he enforced a blockade. This became known as the Continental System. It required that all continental European nations desist from trading with Britain. If they did so, the Grande Armee would be called into action to ensure any rebellious nation be whipped into line again. This juggernaut could muster up to 685,000 men at its peak, recruited from all of Europe. Spain defied Napoleon, and they were crushed. Russia defied Napoleon and they too were crushed.
For the ‘nation of shopkeepers’ this was understandably a disaster – cut off from the majority of their trading partners, much of their economy became under risk. Further, the Royal Navy – inherent to controlling the seas for all of Britain’s trade as well as protecting it from an invasion, required lumber. Baltic lumber. Such lumber was traded in continental Europe, but Britain would have no access to it until they agreed to accept the status quo in Europe.
It was one of Napoleon’s wisest decisions, and an action that proved he could masterfully fight economic warfare as well as conventional warfare.
Yet it failed. Baltic timber, once indispensable for the construction of the Navy’s ships, became unnecessary, as the British looked elsewhere. Canada presented a prime location. European goods, once so central to British traders became hardly missed as the rest of the world found themselves enjoying an economic boost. Europe was almost rendered economically superfluous as Britain proved that it connected with the world was stronger than France, connected solely to the European continent.
Indeed, the desperate requirement for timber led to a great increase in trade between Britain and Canada, and between 1807 and 1809, Canadian exports of wood increased threefold, and became a major part of the British merchant system. Some sources state that the Continental System also led to imports of wood from Australia. Towns and colonies near natural resources – like Newfoundland – found themselves enjoying unparalleled economic prosperity, as a Global Britain searched for what it needed.
In the end, Napoleon’s attempts to punish Britain for refusing to accept his de facto rule over Europe failed, only succeeded in harming the wealth of Europe; the British economy was kept ‘afloat’ by the increase in imports from the rest of the world, and strengthened the mutually beneficial relationship between Britain and the colonies.
From this somewhat marginalised part of the history of the Napoleonic Wars, a lesson can be learned: blockades can backfire, sometimes with disastrously unforseen results. Yet this was when Europe monopolised much of the global GDP, and when a economic blockade was possible. Today, the rest of the world has overtaken Europe as the economic powerhouse, and in the present day a tariff war would be extremely disastrous – much more so, and would harm the remaining members of the European Union equally, if not more, than ourselves. Further, under WTO rules, banning trade and blockading a nation for not paying a fee is illegal, and would not be allowed to continue unchecked.
The question remains why is Barnier seemingly happy to begin a tariff war? Does he think he can succeed where Napoelon – who had more resources and power – failed? As a clever man, who knows much of economic issues, I cannot believe he wants a tariff war or a de-facto blockade.
To me, what he and the European Commission are doing is brinksmanship. They require the ‘Brexit Bill’, for otherwise they will be left with a vast hole in their budget. Presumably, therefore, their goal is to get as much money from us as they can, and so defer having to make cuts in their departments and projects. To gain extra leverage, it would seem they are threatening irrational actions, in the hopes that we will not notice how such a policy would lead to considerable self-harm, but rather capitulate and pay the £100,000,000,000 – in Euros.
What Monsieur Barnier, Junker and those commonly labelled the ‘Eurocrats’ do not wish to be known is that, while we would by no means benefit from such pointless acts of economic aggression, we would suffer considerably less than the European Union would. Therefore, it is almost certainly an empty threat. One is reminded of General De Gaulle’s famously categorical “non”s over British accession to the EEC.
Yet even if it is not the case, but they wish to make life as difficult for all living in the UK as possible, including EU citizens, then I cannot overestimate the importance of leaving the EU at once. We are allies, we are partners, and we wish to trade and deal openly and fairly with our European neighbours as well as the entire world. If they do not wish to do so, but would rather seek to make life harder, more expensive and erect barriers to trade and our relationships, this would be extremely regrettable.
If so, I would like to make one final comment: The EU accounts for $16 trillion of the world’s $75 trillion GDP. If Britain must choose – and we do not wish to do so – between a petty minded, neocolonial and imperialistically operated Europe and The Open Sea, then we shall choose The Open Sea. De Gaulle was right – we would not sell out entirely towards the European Project: We are a global nation, and Europe will continue to have a special place in our globe – provided they wish to that to be the case.
Surely bullying and blackmail cannot be helpful in ensuring the peace and prosperity of Europe, Mr. Barnier?
Article inspired after reading Alexander Fluza’s excellent article in The Commentator: http://www.thecommentator.com/article/6631/britain_has_beaten_continental_bullies_before