twelve myths about the eu 2016

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Twelve mythsabout the

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ii | Twelve myths about the EU

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Twelve myths about the EU | 1

Twelve myths about the EUOutside the EU, Britain would be isolated and loseits influence.Most of the world is outside the EU, including six of the world’s 10 biggesteconomies. Britain, the fifth biggest, would make that seven.

The BRICS economies (Brazil, Russia, India, China, South Africa) account for31% of world output and more than half of global economic growth. The EUshare of global GDP has fallen continuously from 28% in 1990 to 17% in 2015.[1] Less than half (48%) of Britain’s external trade is with the EU — even less(46%) if non-EU trade routed through Rotterdam is excluded. [2]

Britain would retain its membership of the UN Security Council, the OECD,the Council of Europe, the Organisation for Security and Cooperation inEurope (OSCE) and many other international bodies, and regain its ownindependent seat at the World Trade Organisation.

Britain would be free to negotiate its own foreign, trade and defence policies inpartmership with other countries across the world.

The EU is a vital source of employment, includingthree million jobs that depend on exports to Europeas our largest market.All the EU structural funds spent in Britain (£4.6bn forecast for 2016) aredwarved by our annual net contribution to the EU budget (£15.2bn in 2016).[3] In other words, Britain outside the EU could spend four times more onthese agricultural, social and regional programmes by redeploying this netcontribution.

Just under half the stock (48%) of foreign direct investment in Britain is fromthe EU, unchanged for a decade or more. But while the flow of newinvestment from the EU has shrunk to 19% (latest 2014), the inflow remainsconstant from US companies (around 55%) and continues to grow from theFar East (22%). [4]

The share of Britain’s exports going to EU states has dropped steadily fromover half (55%) in 2007 to less than half (44%) in 2015. [5] More jobs in Britainnow depend on exports to the rest of the world. Britain’s trade deficit with theEU has trebled, while that with the rest of the world has been cut by two-thirds.

2 | Twelve myths about the EU

Britain’s non-EU exports are growing by 5% a year — while exports to the EUdecline. By far the biggest growth markets are China, Switzerland and theMiddle East. We don’t need to become part of the USA or China to havetrading and other relations with them — why should the EU be different?

EU treaties and laws prohibit member state governments from takingmeasures to save or create jobs which ‘distort’ competition and the freemovement of capital, labour and commodities. This includes subsidies, importor capital controls, public procurement contracts favouring local workers orfirms etc. Such restrictions have helped destroy millions of jobs in Britain insteel, coal, manufacturing and agriculture since joining the European EconomicCommunity in 1973.

Outside the EU, Britain could negotiate mutually beneficial agreements withother countries instead of secretive EU pacts that benefit big business, such asthe Transatlantic Trade and Investment Pact (TTIP) with the USA.

Even outside the EU, we would still have to abide byEU rules in order to trade with it.Most countries around the world require imported goods and services tocomply with their own domestic standards and specifications. At the sametime, European countries which trade with the EU such as Norway and Icelandstill prefer to remain outside it and pursue their own economic, financial, socialand foreign policies.

The EU runs a trade surplus with Britain on which four million export jobs onthe European continent depend. It would be in the EU’s own interests toconclude a non-tariff trade agreement with Britain. Any EU tariffs would belimited under WTO rules and a British government could compensateexporters from its own tariff revenues.

As a major economic and political power and trading partner, Britain would bein a far stronger position than most other countries to reach a wide range oftrade and other agreements with the EU.

EU membership has brought many rights and benefitsto ordinary people, especially at work.Our main democratic, employment, trade union and welfare rights in Britainhave been won by the sacrifice and struggles of the people — not gifted to usby our rulers in Britain or the EU.

Most of our employment, trade union, health and safety, equal pay, minimum

wage and anti-discrimination rights have been enacted by British legislation.This includes the 1998 Working Time Regulations, which improved upon theEU Working Time Directive (28 days paid leave instead of 20 — althoughstatutory bank holidays were not excluded); better rights for farm workers;longer daily rest for young workers).

Neither EU nor British legislation has prevented the average full-time workerin Britain having the third longest working week in the EU, behind only Greeceand Austria. Workers in 21 other EU states have more statutory days off withpay (total leave and public holidays) than in Britain.

The EU has never sought to enact or enforce a statutory minimum wage, theright to strike or the right to join a trade union; nor does it protect workersagainst lock-outs. Article 153 of the Treaty on the Functioning of the EU(TFEU) explicitly forbids EU action in these areas.

The EU has done nothing to protect workers in Britain from a stream of Toryanti-trade union laws since 1979, while EU Court of Justice (ECJ) rulings haveoutlawed trade union action to enforce or achieve fairer treatment ofimported (‘posted’) workers by foreign employers (the Viking and Laval cases)and government action to enforce regional procurement or nationalemployment law in similar circumstances (the Ruffert and Luxembourg cases).

EU Commission and European Central Bank austerity programmes haveimposed mass unemployment, higher taxes, wholesale privatisation and hugecuts in pensions and benefits on the peoples of Greece, Cyprus, Portugal,Spain, Italy and Ireland — in return for ‘bailout’ funds to pay German, Britishand French banks and other holders of government bonds .

The EU means freedom to travel, work and residethroughout Europe.The ‘free movement of people’ principle in the Treaty of Rome (1957) hasalways been a cloak for the ‘free movement of labour’, so that workers canmove more easily to where business can make a bigger profit from them. Thisgoes alongside the free movement of capital and commodities, which alsoenables big business to maximise profits in the ‘Single European Market’created after 1992.

The result has been mass migrations of capital, jobs and labour across Europeat the expense of national and regional economies, local communities andunion negotiated terms and conditions of employment.

Cheaper, more flexible and super-exploited imported labour has been used asa form of ‘incomes policy’, holding down wages as profits and dividends go up.


Freedom to travel, work and live elsewhere need not depend on membershipof a political and economic union. Visa and residency arrangements existbetween Britain and most countries across the world, while the EU hasreached similar agreements with Norway, Switzerland and other non-EU statesin Europe.

Many problems today are international, and sorequire a coordinated EU approach.

Problems of global warming, pollution, malnutrition, disease, economic andfinancial crisis, organised crime, corruption, war, mass migration etc. are oftenwider than the EU. Britain already plays its part in numerous internationalagencies (the UN, WHO, Unesco, ILO etc.), based on individual memberstates, to combat them.

The EU represents the interests of Europe’s big business corporations, using itscollective strength to undermine many international agencies to the cost ofweaker countries and their peoples (e.g. carbon emission trading schemeswhich transfer pollution to the Third World and create a new financial market;trade and debt restructuring agreements which require market access andprivatisation).

As the world’s fifth biggest economic power with economic, political andcultural relations across the world, Britain has its own resources, expertise andperpsectives to contribute to solving international problems.

The EU has brought peace in Europe for 50 years ormore.The EU originated in a ‘Cold War’ bloc to rebuild monopoly capitalism inwestern Europe and confront the Soviet Union and the new socialist states ofeastern Europe.

After NATO was formed in 1949, plans for a ‘European Defence Community’alongside the European Coal and Steel Community were thrown out byFrench Communist and Gaullist MPs. West Germany was then rearmed andadmitted into NATO, leading to the formation of the Warsaw Pact in 1955.

Peace was kept in Europe by anti-war feeling in the West and the Soviet policyof ‘peaceful co-existence’, despite the US-led arms race. The German-Sovietprocess of detente led to the formation of the OSCE in 1975, which played aleading role in easing tensions, although the EU strives to marginalise the OSCEand its work for peace-keeping, arms control, democracy and human rights.


Since the end of the Soviet Union and the Warsaw Pact, the EU has expandedeastwards alongside NATO, developing its own capacity for rearmament andmilitary intervention in league with NATO, under the Lisbon Treaty. EU stateshave helped destabilise Yugoslavia, Ukraine, Afghanistan, Iraq, Libya, Syria andparts of Africa.

If Britain votes to leave the EU, it would be a victoryfor the political right.The mainstream political right supports EU membership, reflecting theinterests of big business, while wanting to protect the City’s banks and financialmarkets from any EU regulation and discrimination (the chief objective ofCameron’s renegotiations)

A vote for withdrawal would bring down the Tory government and create theconditions for electing a Labour government on a left programme ofprogressive taxation, economic planning, public investment, public ownership,industrial regenration and ecological security.

Free from EU barriers and restrictions, Britain could more easily promotepolicies at home and abroad which put people and the planet first, notcorporate profit.

Scotland and Wales benefit from EU funds andBritish withdrawal would lead to the break-up ofBritain.Wales receives around €23m (£18m) a year — €117m (£92m)according toPlaid Cymru — more from EU funds than it puts in. [6] But this is less thanone-fifth of 1% of Britain’s net contribution to the EU Budget (£15.2bn in2016) and of the National Assembly’s annual block grant from centralgovernment (£15.5bn in 2016).

In July 2015, it was revealed that the SNP government has been compelled todrastically amend its Scottish Futures Trust project for public investment inschools, hospitals and roads to give the private sector a bigger, more profitablerole. [7]

Scotland and Wales have suffered heavily from the export of capital and jobsto southern and eastern Europe, where labour is skilled but cheaper andenergy and transport costs are lower.

As independent member states of the EU, Scotland and Wales would beamong the smallest, while their main economic relations would continue to be


with England. The Scottish Government in Edinburgh accepts that Scotlandwould continue to be a net contributor to the EU Budget as a separatemember state.[8]

The EU can be reformed to serve the interests of thepeople.Creating a ‘Social Europe’ was the sugar coating on the ‘Single EuropeanMarket’ pill. But since 1992, EU social programmes have been cut or directedtowards eastern Europe. Employment rights no longer expand as the EUdrives up the state pension age across Europe.

Three of the four major EU institutions (the Commission, ECB and ECJ) havetheir extensive powers guaranteed by EU treaties which can only be changedby unanimous agreement within the fourth, namely, the Council of Ministers.

Those fundamental treaties severely limit the ability of EU member stategovernments to fund public investment, rescue failing companies andindustries, save jobs or use public ownership for wider economic, social andenvironmental purposes.

Democracy and human rights will be threatened ifBritain leaves the EU.Democratic rights in Britain are enshrined in our domestic law, together withcommitments arising from international law, its conventions and courts. Thoserights did not originate in the EU.

Tory hostility has been aimed at the European Convention on Human Rights(ECHR, enshrined in Britain’s Human Rights Act) and its European Court —both of which arise from our membership of the Council of Europe, set up in1950 and wholly separate from the EU.

While EU membership obliges all member states to adopt the ECHR, this doesnot prevent governments from flouting both the convention and the UNDeclaration of Human Rights. In December 2014, the ECJ blocked a drafttreaty affiliating the EU to the convention and its court, not wishing to exposeEU institutions and treaties to a different authority — the ECHR’s EuropeanCourt — in matters of human and democratic rights. [9]

We need to defend and extend democratic and human rights, includingthrough the ECHR and OSCE, whether inside or outside the anti-democraticEU.


There is no realistic alternative to EU membership. Most of the world’s countries, big and small, manage without being in the EU.Britain has bilateral agreements with almost all of them, including through ourparticipation in more than 70 international organisations in political, economic,scientific, emvironmental, labour, health and educational matters.

Many countries trade and cooperate with the EU, without being EU membersor accepting the imposition of the pro-big business economic and financialpolicies demanded by EU treaties and institutions.

Joining the European Free Trade Area and through it the European EconomicArea would enable Britain to remain in the ‘Single European Market’, but at theprice of obeying many EU rules and diktats.

Economic, political and other relations could be strengthened by newarrangements with BRICS and the 53 Commonwealth countries, collectivelyand individually.

Five harsh realities about the EU

It’s a big business club. The EU and its forerunners (the European Coal and Steel Community and theEuropean Economic Community) were designed to rebuild the big capitalistcorporations in Western Europe after World War Two, within a single marketwithout barriers to trade and takeovers, behind a tariff wall against imports.

The Treaty on the Functioning of the European Union (TFEU) maintains thecommitment to an internal market in which there is the ‘free movement ofgoods, persons, services and capital’ (Article 26) — the cornerstone of theoriginal Treaty of Rome (1957) establishing the EEC. The aim is to enablebusiness corporations to move capital and labour around Europe in theirefforts to maximise profit.

The TFEU also declares that ‘all restrictions on the movement of capitalbetween Member States and between Member States and third countries shallbe prohibited’ (Article 63). The EU leads the drive in the WTO and throughtrade and investment agreements to open up countries, their markets, naturalresources and public sectors to penetration by European monopoly capital.


EU directives have promoted the fragmentation, ‘marketisation’ and‘liberalisation’ of nationalised utilities and public services, preparing the groundfor privatisation of electricity, the railways and postal services. EU-fundedbailouts have demanded sweeping privatisations as a condition of ‘bail out’loans to member states in debt to German, French and British banks.

Corporate interests lobby the EU Commission and EU Parliament on anenormous scale. Big business corporations use their close links with EUCommissioners to shape EU policy on a wide range of issues, not least throughthe European Round Table of Industrialists and the European Financial ServicesRound Table.

It’s anti-working classAll the EU talk about a ‘Social Europe’ to win over trade unions and agnosticsocial democratic parties, smoothing the way to the 1992 ‘Single EuropeanMarket’, has evaporated. The Working Time Directive is full of loopholes (e.g.employees can opt out under employer pressure) and, like the Parental LeaveDirective, falls shorth of provisions won by struggle and progressivegovernments in some EU member states. EU directives have not closed thegender pay gap, limited the average working week to 48 hours or raised paidholidays in Britain to the average European level — only trade union action andnational legislation can be relied upon to do that.

The protection for imported migrant labour in the EU Posting of WorkersDirective has been undermined by a series of EU Court of Justice rulings (theViking, Laval, Ruffert and Luxembourg cases). These outlaw action by tradesunions, regional and central governments to secure compliance with collectiveagreements, local government regulations and even national legislation bytransnational corporations for their imported workers.

EU austerity policies have resulted in mass unemployment and deepeningpoverty for millions of workers and their families.

It’s anti-democratic and unreformable.Besides the Council of Ministers, the most powerful bodies in the EU are theEuropean Commission, the European Central Bank (ECB) and the EuropeanCourt of Justice. The Commission’s appointed members draft and police EUlegislation, including powers to sanction democratically elected member stategovernments. It shares some of these roles in financial affairs with the ECB,which also controls central banks and interest rates throughout the eurozoneand must remain free from any supervision or accountability under Article 130of the TFEU.


The European Parliament is directly elected, but on a scale so large (one MEPfor every 500,000 electors) as to make it meaningless. Fewer than half theelectorate bothers to vote (43% in 2014 and only 34% in Britain). Unlike otherparliaments, the EUP cannot initiate legislation, all of which comes from theCouncil of Ministers, although it is drafted and mostly initiated by theCommission. Amendments must then be agreed by the Council (usually on theCommission’s recommendation). Nor can the EUP sack Commissioners exceptall at once (the unusable ‘nuclear’ option). Only the Commission president,elected by the EU Parliament, can sack individual Commissioners.

The anti-democratic institutional arrangements and basic free market, pro-austerity policies of the EU are set in concrete in EU treaties. These can onlybe amended by unanimous agreement of all member states (28 at present).Should Britain elect a left or progressive government, the treaties will act as astrait-jacket on its policies, which could only be removed if every other EUgovernment agrees to treaty change.

The fundamentally anti-democratic character of the EU has beendemonstrated by its refusal to accept the result of national referendums thathave gone against proposed new treaties: those in Denmark (1992 Maastricht)and Ireland (2001 Nice and 2008 Lisbon) were run again in order to secure apro-EU result. After France and Netherlands (2005) voted against a EuropeanConstitution, referendums in Britain and other member states wereabandoned; the proposals were transferred into the Lisbon Treaty and afterIreland voted against (2008), in the only referendum to be held, anotherreferendum was held to reverse the result.

When elected national governments in Italy and Greece defied EU demandsfor even more austerity and privatisation in 2010, they resigned under pressurein favour of unelected caretaker regimes led by EU-approved ‘technocrats’ —a fomer EU Commissioner and ex-Vice President of the ECB, respectively.

It’s reactionary and anti-socialist.EU free market rules prohibit member state governments from planningeconomic development through regulating the movement of capital, goods,services and labour, across and even within the country’s boundaries. Plannedeconomies are, in effect, outlawed by Article 3 (for a ‘highly competitivemarket economy’) of the Treaty on European Union and Articles 119, 120 and127 which repeatedly demand that that all EU member states operate a ‘anopen market economy with free competition’.

The EU Stability and Growth Pact sets limits on public sector financial deficits(3% of GDP) and accumulated national debt (60% of GDP) and commitsmember state governments to achieve balanced or surplus budgets. Thisprohibits government strategies to finance current and/or investment spending


through ‘excessive’ borrowing. Using the state bank to buy public sector bonds(people’s ‘Quantitative Easing’) is expressly prohibited by Article 123 of theTFEU.

Each member state government must submit an annual ConvergenceProgarmme setting out how it is implementing an austerity programme ofdeficit reduction in line with the Growth and Stability Pact. [10]

State aid or any kind of preferential treatment to protect, rescue or promotespecific companies or strategic industries — whether in the private or publicsector — is banned as a distrortion of competition under TFEU Article 107.The EU Commission may grant very limited or temporary exceptions.

EU Directives have enshrined Value Added Tax as the EU’s ‘tax of choice’ to beimposed in all member states at no less than 15% on most goods and services,or at least 5% on specified essental items if not already zero-rated. Suchindirect taxation favours the rich, because everyone pays the same ratewhereas taxes on income or wealth can be levied at different rates.

It’s imperialist not internationalist.

From its inception, the EU has been constructed to promote the commoninterests of Western Europe’s capitalist monopolies at home and abroad. Thishas included trade agreements with existing and former colonies to facilitatethe import of cheap goods into the EU, while maintaining tariffs against rivalsfrom North America and the Far East.

As the major monopolies inside ‘Fortress Europe’ have grown stronger, so theEU has moved to a policy of breaking down protectionist barriers, so thatEuropean companies can exploit markets and raw materials across the world.

Today, the EU negotiates trade and investment pacts with other countries andregional associations in order to exploit commercial markets (the US, Canada)and labour and material resources (India, Malaysia, Ukraine, Peru, Colombia)more thoroughly. Plans have been agreed for the EU to take over all trade andinvestment negotiations with other countries and regions, replacing bilateralones conducted by individual members states.

As the EU develops its military dimension and merges into NATO’s structuresand strategies under US domination, so it more openly pursues the commonobjectives of Western imperialism particularly in relation to Russia and theformer Soviet Union, the Middle East, China and Africa. This includes theeastward expansion of the EU in tandem with NATO and greater involvementin military intervention of every kind, including the construction of newfacilities and war.


Five good reasons to leave the EU

1The British, Scottish and Welsh governments would be free to financepublic expenditure and support industries and services in whatever ways

they decide; free from the EU Classical Directive on public procurement, localgovernment could award larger contracts to local suppliers.

2The British government would be free to reduce or abolish VAT as itwishes, including as part of strategy to combat poverty and inequality.

3A future British government would be free to regulate the movement ofcapital, goods and services in order to boost domestic investment in

productive industry, stimulate economic growth and balanced industrialdevelopment, support strategic sectors and enterprises, encourage differentforms of public and social ownership, and protect all workers against super-exploitation.

4Britain would be free to conduct its own independent foreign, trade anddefence policies, instead of being represented by the EU in international

trade matters and bound by EU common foreign, defence and security policies.

5Workers, progressives and socialists could fight for policies to be enacted atlocal, national and all-Britain levels that could not be blocked or outlawed by

an EU that is beyond fundamental reform.


Notes[1] IMF, World Economic Outlook (October 2015):http://www.imf.org/external/datamapper/index.php

[2] ONS Statistical Bulletin, Balance of Payments, Quarter 3, 2015 (23December 2015), Tables B and C; ONS, UK Trade in goods estimates and theRotterdam effect (6 February 2015).

[3] OBR, Economic and Fiscal Outlook (November 2015) supplementary fiscaltable 2.25: http://budgetresponsibility.org.uk/download/economic-and-fiscal-outlook-supplementary-fiscal-tables-november-2015/

[4] ONS, Foreign Direct Investment, 2014 (23 December 2015):http://www.ons.gov.uk/ons/publications/re-reference-tables.html?edition=tcm%3A77-392545

[5] HMRC, https://www.uktradeinfo.com/Statistics/Pages/Annual-Tables.aspx[6] https://fullfact.org/europe/wales-getting-best-deal-out-eu/

[7] http://www.theguardian.com/uk-news/2015/jul/27/scottish-government-rely-private-money-public-projects-childrens-hospital-eu-rules-state-spending

[8] Scottish Government, Scotland in the European Union (November 2014).

[9] http://www.euractiv.com/section/justice-home-affairs/news/court-of-justice-rejects-draft-agreement-of-eu-accession-to-echr/

[10] The annual UK Convergence Programme can be found at:https://www.gov.uk/government/collections/uk-convergence-programme



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