“If it is good enough for Iceland to do it,” Nigel Farage remarked in the first of his two televised debates with Nick Clegg, “I’m damned certain the British with 64 million can do even better.” The Ukip leader was referring to a free trade agreement that the Icelandic government signed with China in April 2013, despite the tiny Nordic country not being a member of the EU. Is this what proud British Euroscepticism has been reduced to – comparisons with Iceland? Together with Norway (population: five million) and Liechtenstein (population: 36,000) – those two powerhouses of the global economy – Iceland (population: 326,000) is a member of the snazzily named European Economic Area. The EEA is, in essence, the faux-EU, the geopolitical equivalent of a knock-off Gucci handbag. Rather than having all of the pros of EU membership with none of the cons – as some British Eurosceptics disingenuously suggest – EEA membership guarantees some of the pros and most of the cons.
Take Norway, often cited by the anti-EU brigade as a possible model for Britain. Despite being outside the EU, Norway has had to implement 75 per cent of its laws – 6,000 pieces of legislation. “We have been more compliant than many EU member countries,” the premier Erna Solberg, leader of the Conservative Party, has confessed. (In the 1990s, Norway was known as the “fax democracy”, with Brussels simply faxing new directives for the Norwegians to follow.)
It’s not a cheap deal, either. Norway’s total financial contribution to the EU each year is about €340m – which, per capita, works out to be slightly higher than the UK’s.
As for the “free movement” of workers that so upsets Tory backbenchers, the non-EU Norway, like the non-EU Iceland, is a signatory of the Schengen Agreement, which scrapped internal borders – unlike the UK, an EU member, which opted out. Is it any wonder that a government-commissioned report concluded in 2012 that Norway had seen “extensive Europeanisation” over the past two decades and that it was an “illusion” to believe it was outside of the EU?
Forget Norway, then. How about the wealthy, dynamic, free-market Switzerland (population: eight million), which arranges its own bilateral deals with all its trading partners, including the EU? The Swiss negotiate on an individual, case-by-case basis and are under no obligation to implement all of the EU’s internal market legislation. What’s not to like? Boris Johnson is so keen on the so-called Swiss model that he coined the term “Britzerland”.
But wait. First, Switzerland has a free trade agreement in goods with the EU but no agreement on services – including, astonishingly, on financial services. Remember that the UK accounts for a third of the EU’s wholesale finance industry. Want to try selling the Swiss option to the City of London now? No? I didn’t think so.
In 2009, the Swiss government acknowledged: “The existing [EU] barriers to market access place Switzerland at an economic disadvantage.” It added: “Switzerland loses out in terms of jobs, value creation and tax receipts.”
Second, whatever happened to no taxation without representation? Although it is outside the EU and outside the EEA, too, Switzerland contributes about €450m a year to the EU budget.
Third, Swiss sovereignty is overrated. The country relies on roughly 120 separate bilateral agreements with the EU and it is expected to adopt every single EU regulation in each of those areas – again, without any say on their shape, structure or content.
Eurosceptics harp on about the need for democracy. But the Swiss, like the Norwegians and the Icelanders, choose to eat food from a table at which they have no seat. They have no spots on the European Commission, no members of the European Parliament, no invitations to the Council of Ministers, no judges on the European Court of Justice. Yet, to varying degrees, they submit to EU legislation over which they have no votes, no vetoes and very little influence.
The simple truth is that whether the UK is inside the EU or out, we’ll have to follow EU rules and regulations. Eurosceptics say they like the EU’s single market but don’t like the EU’s regulations. What they seem unable – or unwilling – to understand is that there is no single market without regulations; it is the regulations that make it a single market, rather than a continent-wide free-for-all.
And it is the single market that gives EU member states power, clout and influence on a global scale. Do we want to negotiate with the Chinas and Russias of the world as part of a 28-member bloc of 500 million people? Or quit the biggest single market in human history in order to emulate Iceland, a country with a population smaller than Bristol? Eurosceptics bridle at being called “Little Englanders”. Yet their obsession with the likes of Norway, Iceland and Switzerland suggests the label may be an understatement. Tiny Englanders, perhaps?
The EU is far from perfect. It does need to change – to become less austerity-focused and neoliberal, for a start. The EU’s Common Agricultural Policy needs reforming and the Transatlantic Trade and Investment Partnership agreement with the US, which will empower unelected corporations at the expense of elected governments, needs rewriting. But you don’t win a fight by leaving the ring. You get in, stay in and keep fighting your corner.
Mehdi Hasan is a contributing writer to the New Statesman and the political director of the Huffington Post UK, where this article is crossposted