The EU, law-maker or law-taker?
Of interest to anyone who seriously wishes to campaign for Britain leaving the European Union was this story in the Telegraph recently. In short a number of ‘city types’ have, quite correctly, asserted that Brexit will not lead to a slashing of financial regulations and red tape. Indeed their viewpoint can be extended beyond finance to many other areas of life and it attacks an old eurosceptic theme that is still trotted out, the idea that when we leave the EU masses of regulation will go and we shall be free from our bondage to it. However this is clearly, when investigated, a staid, stale piece of reasoning that is simply out of date; the question is, why?
The answer can be summed up in one word: Globalisation. This seemingly inexorable process of the integration of economies, markets and policy making around the world has, and will, continue to change and shape the origin and nature of the regulations that effect us all and in such diverse areas of life ranging from trade to food quality to social policy. It is this very modern phenomena that means regulations are increasingly created at a global level by a vast array of different bodies, many under the aegis of the UN, and passed downwards to such as the European Union. Consequently the EU is becoming a law-taker, not a law-maker. This process is only likely to gather pace.
Finance(the starting point of this piece) just happens to be a prime example of how this new force of Global Governance is shaping our 21st century world. The important body in framing financial regulation is the Financial Stability Board(FSB) based not in Brussels but Basel. The FSB’s sponsoring body is the G20 and it is at the very centre of a web of international organisations that are concerned with global financial regulations, one of the many being the EU. Others include, for example, the Basel Committee on Banking Supervision(BCBS) and the International Association of Insurance Supervisors(IAIS). From Basel the global agenda on finance is steered, monitored and passed downwards. Hence the post 2008 financial crisis reforms initiated by the G20 were mainly those then taken up by the EU. A House of Lords report on the EU reaction to this crisis acknowledged the international origin of it’s work;
“… it is likely that the UK would have implemented the vast bulk of the financial sector regulatory framework had it acted unilaterally, not least because it was closely engaged in the development of the international standards from which much EU legislation derives.”
And it does not end with finance. The role of the International Labour Organisation in forming EU social policy and Labour rights is highlighted by LeaveHQ here and Pete North has carried out excellent analyses of the role of the International Maritime Organisation, for example here. I could also mention the role of UNECE, Codex, WIPO, ISO etc, etc.
All this begs the further question: with EU regulations actually made above it, does this not make our membership superfluous? I would argue yes, but it is actually worse than that. Our continued membership in the 21st century will be damaging because on many global bodies we have to go along with the EU agreed position even if it is not in our national interest. Pete North’s work includes a first class example of EU membership having a negative effect on the UK in the area of maritime law, here. If regulations are now increasingly made at the global level then it is clear we need to be free of the EU, and its insistence on 28 states having a common position, and so be able to speak for ourselves at the Global Top Tables. Then we would have the free vote, veto and opt-outs available to independent countries and be able to act in our own interests.
In conclusion, and put bluntly, the EU is becoming redundant and it is globalisation that has handed out the notice. Post Brexit there will be no bonfire of regulations because the EU doesn’t make them, it merely adopts from above and passes them off as its own. For Brexiteers this is great news for we can demonstrate that the EU is a middle-man that once cut out post Brexit will enable an independent UK to have far greater influence where it really matters and so have a prominent voice in helping shape the modern, globalised world. It is a positive, progressive message; so let’s get it out there. What’s not to like?
