EU-US free trade talks show why Britain is better off in

Few can seriously claim that UK on its own would have as much clout in trade negotiations as the whole of the EU.

Like it or not, David Cameron had a good win at the EU budget summit last week. After over 24 hours of caffeine-powered talks he got what he came for - a real terms cut in EU spending. That said, it is easy to overplay Cameron's role in the marathon talks. Germany's Angela Merkel was, as ever, the real dealmaker.

In any case, as Will Straw wrote last Friday, the budget deal is hardly something to celebrate. The budget headings that suffered the biggest cuts were "Global Europe" - which includes development spending - and investment in infrastructure projects. In contrast, despite being cut by 11 per cent, spending on the Common Agricultural Policy - possibly the worst and most wasteful of all EU policies - remains the largest single area of spending.

But while 99 per cent of the summit media coverage was about rehearsing centuries-old cliches about European diplomacy - in last week's case, Britain screwed the French by making a deal with the Germans - the importance of the EU budget was actually pretty low. In fact, while over 24 hours were spent haggling over how Europe would spend just over €900bn of its own money, leaders spent a few minutes and several pages of the summit communique talking about something of far greater significance to the EU's future.

The importance of Barack Obama's launch of formal negotiations aimed at agreeing the world's biggest ever bilateral trade deal during his State of the Union speech to Congress yesterday, dwarves the endless debates in Brussels on rebates, "own resources", and the difference in funding for Pillars 1 and 2.

It hasn't happened overnight. Since autumn 2011, diplomats have been working behind the scenes on preparing the ground for a EU/US trade talks. Full negotiations on a deal looking not just on the elimination of tariff barriers but also on harmonising regulatory and technical standards for products could generate 2 per cent of GDP on its own. EU officials think that, by itself, a US trade deal could translate into €275bn per year for the European economy and two million new jobs.

The EU - as both its supporters and critics would agree - is not just about the single market, but its status as the world's largest market is a valuable and, so far, relatively under-used commodity. At the moment, just four of the EU's 29 trade deals are with countries from the G20, and those four are with South Korea, Mexico, South Africa and Turkey. But the EU is now devoting increasing amounts of political capital to trade. An FTA was agreed with Singapore in December while a deal with Canada is expected to be completed imminently. Negotiations with Japan are expected to be launched in Tokyo in April, meaning that the EU will spend the next year brokering trade deals with the two largest world economies. In contrast to the EU's budget talks, there's nothing inward looking about that.

It is also a welcome sign that leaders are recognising that trade is the single most effective alternative to austerity. The collapse of the Doha round of WTO trade talks in 2005 followed by the financial crisis did real damage to world trade and to the European economy. One of the little-noticed developments in economic policy in recent years has been the glut of protectionist measures. The World Trade Organisation stated earlier this year that only 18 per cent of the trade restricting measures adopted by G20 countries since 2008 have been scrapped, amounting to a total loss of 3 per cent of world trade - equivalent to some €350bn.

But while the drive towards trade marks a decisive shift in priorities by the EU, it is also hugely significant to the debate on Britain's continued EU membership and to the Conservative Party's attitude to Europe.

One of the common lines of attack from the 'better off out' brigade is that, shorn of its EU shackles, Britain would be able to go around agreeing its own free trade deals. In response, one of the most convincing argument in favour of Britain being at the heart of Europe is that together we're stronger. In the EU we are one of the most powerful players in a bloc of 27 countries and 500 million people. Outside, we are, at best, a medium-sized power. When it comes to dealing with the likes of the US and Japan, few can seriously claim that Britain on its own would have as much negotiating clout as the whole of Europe.

Besides, an EU pursuing a free trade agenda should be like manna from heaven for most moderate Tories. It should also pacify those who grumble that the EU should be about trade, not political union. At the very least, if the EU continues the shift towards using its muscle to drive international trade deals it will becoming increasingly difficult for Conservative eurosceptics to maintain that we are better off out.

A couple of days before last week's summit, the Europe minister, David Lidington, told reporters that, come 2017, he and David Cameron wanted to be "campaigning with enthusiasm for a 'yes' vote". On his wish list, alongside less EU regulation and a liberalisation of the services sector, was the "fantastic prize" of a transatlantic trade deal. In Lidington's words, failing to go for it would be "betraying future generations". Cameron himself said today that an EU/US agreement would "create jobs on both sides of the Atlantic and make our countries more prosperous." It looks as though his wish may yet be granted.

It goes without saying that a transatlantic trade agreement is far from a fait accompli. Both sides like to subsidise large parts of their economy - particularly farming - and both will be under pressure from powerful internal lobby groups hoping to strangle the baby before it is born. But the EU and US have, nonetheless, made a bold statement of intent which could eventually lead to a seismic change in the world economy.

Ben Fox is a reporter for EU Observer. He writes in a personal capacity

European Commission President José Manuel Barroso speaks following a summit with US President Barack Obama as European Council President Herman Van Rompuy looks on. Photograph: Getty Images.
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Owen Smith is naïve if he thinks misogynist abuse in Labour started with Jeremy Corbyn

“We didn’t have this sort of abuse before Jeremy Corbyn became the leader.”

Owen Smith, the MP challenging Jeremy Corbyn in the Labour leadership contest, has told BBC News that the party’s nastier side is a result of its leader.

He said:

“I think Jeremy should take a little more responsibility for what’s going on in the Labour party. After all, we didn’t have this sort of abuse and intolerance, misogyny, antisemitism in the Labour party before Jeremy Corbyn became the leader.

“It’s now become something that is being talked about on television, on radio, and in newspapers. And Angela is right, it has been effectively licenced within the last nine months.

“We’re the Labour party. We’ve got to be about fairness, and tolerance, and equality. It’s in our DNA. So for us to be reduced to this infighting is awful. Now, I understand why people feel passionately about the future of our party – I feel passionately about that. I feel we’re in danger of splitting and being destroyed.

“But we can’t tolerate it. And it isn’t good enough for Jeremy simply to say he has threats too. Well, I’ve had death threats, I’ve had threats too, but I’m telling him, it’s got to be stamped out. We’ve got to have zero tolerance of this in the Labour party.”

While Smith’s conclusion is correct, his analysis is worryingly wrong.

Whether it is out of incompetence or an unwillingness to see the extent of the situation, Corbyn has done very little to stamp out abuse in his party, which has thus been allowed to escalate. It is fair enough of Smith to criticise him for his failure to stem the flow and punish the perpetrators.

It is also reasonable to condemn Corbyn's inability to stop allies like Chancellor John McDonnell and Unite leader Len McCluskey using violent language (“lynch mob”, “fucking useless”, etc) about their opponents, which feeds into the aggressive atmosphere. Though, as I’ve written before, Labour politicians on all sides have a duty to watch their words.

But it’s when we see how Smith came to the point of urging Corbyn to take more responsibility that we should worry. Smith confidently argues that there wasn’t “this sort of abuse and intolerance, misogyny, antisemitism” in the party before Corbyn was voted in. (I assume when he says “this sort”, he means online, death threats, letters, and abuse at protests. The sort that has been high-profile recently).

This is naïve. Anyone involved in Labour politics – or anything close to it – for longer than Corbyn’s leadership could tell Smith that misogyny and antisemitism have been around for a pretty long time. Perhaps because Smith isn’t the prime target, he hasn’t been paying close enough attention. Sexism wasn’t just invented nine months ago, and we shouldn’t let the belief set in that it did – then it simply becomes a useful tool for Corbyn’s detractors to bash him with, rather than a longstanding, structural problem to solve.

Smith's lament that “it’s now become something that is being talked about” is also jarring. Isnt it a good thing that such abuse is now being called out so publicly, and closely scrutinised by the media?

In my eyes, this is a bit like the argument that Corbyn has lost Labour’s heartlands. No, he hasn’t. They have been slowly slipping away for years – and we all noticed when Labour took a beating in the last general election (way before Corbyn had anything to do with the Labour leadership). As with the abuse, Corbyn hasn’t done much to address this, and his inaction has therefore exacerbated it. But if we tell ourselves that it started with him, then we’re grasping for a very, very simple solution (remove Corbyn = automatic win in the North, and immediate erasure of misogyny and antisemitism) to a problem we have catastrophically failed to analyse.

Anoosh Chakelian is deputy web editor at the New Statesman.