The National Review might not be down on all the fine details of Brexit*, and quite possibly put too much faith in the elimination of tariffs as a means of spurring trade, given the modern shift toward non-tariff barriers, but their forthright and optimistic call for a swift US-UK trade agreement is most welcome nonetheless.
(*In which they are hardly alone, joined by most of the UK media and many elected British politicians, who unlike the National Review have no excuse for their ignorance)
Stephen Meyer writes:
First, a free-trade agreement between the U.S. and U.K. would foster trade and growth in both countries without subjecting either to the onerous external regulation and loss of democratic control that Britain has experienced in the European Union. Until now, the exclusive nature of the EU prevented Britain from establishing a free-trade pact with America, its most lucrative trading partner, to the detriment of tariff-paying businesses in both countries.
Nevertheless, under treaties governing EU membership, the U.K. cannot make free trade deals with non-EU partners. It must apply the growth-suppressing common EU external tariff, an average of 4.5 percent, to all imports. Once Britain legally extricates itself from the EU, that can change — and should. An agreement between the world’s largest and fifth-largest economies will create a huge free trade zone, benefiting businesses and spurring growth on both sides of the Atlantic.
Second, an agreement that focuses on eliminating tariffs, but not creating supranational oversight bodies, will protect both countries from the loss of sovereignty that British voters rejected with Brexit and that Mr. Trump has criticized. Such a simplified deal would require U.S. companies operating in (or exporting to) the U.K. to accept U.K. law, and U.K. companies operating in the U.S. to do the same. Since U.K. and U.S. law is so similar and both countries have so many lawyers versed in the commercial law of the other, international oversight would prove largely unnecessary. In a bilateral treaty, significant disputes or grievances can simply trigger provisions to renegotiate terms — or to accept arbitration in limited cases before mutually agreed tribunals.
This, of course, serves to underscore the importance of freeing ourselves from the customs union as part of any interim and permanent Brexit deal. To do otherwise would truly be an act of self-harm, constraining Britain’s ability to negotiate freely with other countries just so that bitter Remainers can cling slightly closer to the vestiges of their European dream, with no commensurate benefit whatsoever.
But as Meyer notes, a US-UK trade deal would matter symbolically and diplomatically just as much as economically:
A free trade offer will also help repair the U.S.-U.K. special relationship after eight years of intentional neglect and decades of slow erosion as the result of Britain’s gradual absorption into the EU. Strengthening the alliance with Britain will promote U.S. national security because it will free the U.K. to act decisively as a bilateral partner when the strategic interests of our two countries align — as they often have.
The Obama years have witnessed a dramatic weakening in the strategic position of the United States and the West, as well as a diminution of U.S. military power. In addition to rebuilding military capacity, as Trump has promised, the United States now badly needs genuine allies with shared interests who have demonstrated the will and capability to stand alongside America in times of international crisis. More than any other ally, Great Britain has consistently demonstrated that proclivity and capability: Apart from France, only the U.K. among U.S. allies maintains an independent nuclear deterrent and the capacity to project significant naval power. Among NATO allies, only the U.K. keeps its treaty commitment to spend 2 percent of GDP on defense.
Whatever else one may think of Donald Trump – and I am not a fan – it is at least heartening to hear some vaguely warm sentiments being spoken about Britain again from soon-to-be White House aides.
I have generally admired Barack Obama’s temperament (but not his policies), but his thinly-disguised disdain for Britain and the transatlantic alliance will not be missed. President Obama can be as chummy as he likes with Chancellor Merkel, but when the going gets tough, it is the UK with our nuclear deterrent, blue water navy, deployable armed forces and positive disposition toward America upon which the United States will immediately rely. America’s natural closest allies have not always felt the warmth they might have reasonably expected from the Obama White House. Hopefully this will soon change.
Offering the right kind of trade deal to the British — as they negotiate the return of their own national sovereignty — will decisively advance that goal.
A pragmatic assessment of the mutual shared interests of two great powers and firm allies. Now, doesn’t that sound an awful lot better than Barack Obama’s rigid and unimaginative defence of the failing European supranational project, and his haughty insistence that Britain would go to the “back of the queue” in America’s estimation?
This post was originally published by the author 1 December 2016: https://semipartisansam.com/2016/12/01/after-brexit-a-swift-us-uk-free-trade-agreement-will-be-economically-and-diplomatically-beneficial/