16 September 2017

Social Europe: Economic Sovereignty: A Delusion

It has been Conservative policy in Britain since Mrs Thatcher to reduce the size of the state in pursuit of some golden age where private ownership and management would dominate (see Meek). The scale of the dismantling of the state and the destruction of what Meek calls ‘universal networks’ (the social and technological system deemed essential to all citizens) has been extraordinary. As Meek concludes:

The most absurd paradox of Britain’s privatisation is that it has actually led to the nationalisation of British infrastructure by foreign governments with parts of former British state firms becoming the property of the governments of France, the Netherlands, Sweden, China, Singapore and Abu Dhabi. [...]

It is not that foreign ownership is in itself a bad thing but to argue that Brexit will permit the UK to re-establish economic sovereignty is simply a chimera. The UK is a very open economy with a ratio of Imports and exports to GDP of 61% and rising (51% in 2003). This is one of the highest ratios of any of the G8 countries. How is it possible for an economy so dependent on trade in goods and services to recover its economic sovereignty given this extremely high dependence on imports both for consumption and for production? [...]

The three biggest Eurozone economies (Germany, France and Italy) have jointly presented a paper to the EU Commission calling for a strengthening of powers to control overt political takeovers – especially where these threaten areas of key national interest and security. The Commission would be given the power to review key business takeovers although the ultimate decision making authority would remain at national level.

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