3 April 2016

In, out, find a fib to shout



Voters want facts about Britain and the European Union—but these are elusive Mar 5th 2016 

“WHAT I want is facts…facts alone are wanted in life.” Thomas Gradgrind’s grim message in Charles Dickens’s “Hard Times” is echoed in the debate ahead of the referendum on June 23rd about whether Britain should leave the European Union. Voters confused by claims made by opposing sides and in the media are asking for plain facts on Britain’s EU membership so they can make up their minds. Sadly, hard facts are hard to find.

There is a good reason for this: nobody knows what would happen post-Brexit. That is especially true of the trade deal that Britain would have to negotiate with the EU—and how long that might take (the government this week suggested up to ten years). But there is also a bad reason: that the uncertainty lets all sides distort, exaggerate or simply make up their own facts.


Three examples illustrate this. The first is an old assertion that 3m jobs in Britain depend on trade with the EU. In fact, because of the close links among European economies, many economists reckon the true figure is higher. Yet the claim sometimes made by pro-EU voices that all these jobs would be at risk post-Brexit is a nonsense. Nobody can plausibly argue that all trade with the EU would cease. Anyway, job creation depends more on demand, wage levels and labour laws than on membership of a trade block.

The second example concerns the British contribution to the EU budget. Leavers claim that Britain pays an unfairly large amount of almost £20 billion ($28 billion) a year to Brussels, or £55m a day. In fact this is the gross amount before deducting both the rebate won by Margaret Thatcher in 1984 and the money the EU spends in Britain. Adjusting for these, and for the funnelling of some foreign-aid spending via Brussels, the net payment is less than one-third as big, at £17m a day—and Britain is only the eighth-largest contributor per head.

The third example is competing claims about trade patterns. Remain campaigners say the EU takes 45-50% of British exports, whereas Britain accounts for a tenth or less of the EU’s. Yet Nigel Farage, leader of the anti-EU UK Independence Party, has said Britain takes 20% of EU exports, giving it a stronger hand in future trade talks.

One issue here is which source to use: Europe’s statistical office, the British government and the IMF all have different figures. Another is whether to cover just goods or to add services. But the biggest question is whether to count the EU as a block, discounting all intra-EU exports. Doing that puts the share of EU exports going to Britain at almost 16%. But John Springford of the Centre for European Reform, a think-tank, points out that, in trade negotiations, individual countries, not the EU as a whole, decide what to accept. Britain’s share of all other EU countries’ exports is only around 8%, he says (our chart, using IMF figures, puts it even lower), and in many individual cases a lot less, leaving it in a weaker bargaining position.


The arguments over facts in these areas are as nothing compared with the differences on migration and sovereignty—nor compared with the bitter rows within the Tory party (see article). What should undecided or poorly informed voters do?

Fortunately, there are some good sources they can turn to. Two websites, the broadly neutral fullfact.org and the pro-EU infacts.org, both puncture myths in the debate. The House of Commons library produces excellent reports, which are available online. And a group of academics led by Anand Menon of King’s College, London, have set up “The UK in a Changing Europe”, financed by the Economic and Social Research Council, which has a lively website.

The Economist is not neutral in this debate: we believe Brexit would be bad for Britain, Europe and the world. But we also want to explain the issues and present the facts. So over the next four months, we will publish a series of Brexit briefs that seek to do this, as dispassionately as possible—in the hope of satisfying even the Gradgrinds among our readers.

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