The EU: move on or rejoin?

“We need to rejoin the EU.” I was sitting in the main hall of the Congress Centre in Davos, listening to the European Union president, Ursula von der Leyen, and I was texted by a friend, asking what I was doing. I messaged back: “Listening to Ursula von der Leyen. We need to rejoin the EU.” 

And it was as if, in saying it, a spell had been broken. After the speech, I ran into von der Leyen, as you do, walking the main corridor of the World Economic Forum and I stopped her to say: “I just listened to your speech; it made me think: ‘We need to rejoin the EU.’” “Oh,” she said, smiled and, possibly just out of politeness said, “Please do.”

I’m James Harding, I’m the editor of Tortoise, and I may be bouncy, sometimes naïve or unreasonably upbeat, but I’m not delusional. Rejoining the EU is not on the UK’s political agenda; in fact, neither the Conservatives, nor Labour, nor even the Liberal Democrats countenance it – in fact the Liberal Democrats, the logical advocates of a return to EU membership, have made the political calculation, I was told by one Lib Dem this week, that if they did, if they did advocate joining the EU, their national poll ratings would go up, but they’d be likely to lose even more of the few seats they’ve got in Parliament; it would put a ceiling on their vote and a low one. 

But, in this week’s Editor’s Voicemail, I want to describe my week. I want to describe the thinking process, the discussions that I’ve had, because I couldn’t shake the idea that we need to at least talk about rejoining the EU. Why, even if it’s not on the horizon, it should, most definitely, be on the agenda. 

And here’s why. Globalisation has given way to continentalism. What Ursula von der Leyen was saying this week was that the EU is going to put nearly £1 trillion behind investments in clean, green energy. Just as President Biden’s Inflation Reduction Act is marshalling $2 trillion to invest in green tech and make the US more or less self-sufficient in next generation energy, the EU is trying to do the same.  And so, by the way is China. And so is India, too. 

And it’s not just energy. If the globalisation generation was driven by a combination of technology and markets, this coming decade of continental competition is going to be made by science and capital; whether it’s fusion or generative AI or bio-engineering or quantum, the continents are putting state capital behind scientific research to try and dominate the breakthrough technologies and, with them, societies and markets at scale. Following Covid’s shutdown of global supply chains, the West’s realisation of how reliant it was on Chinese manufacturing and after Putin’s invasion of Ukraine made plain the West’s reliance on Russian energy, the US and Europe have decided they want to own more of their own future: the phrase of the moment is is ‘strategic autonomy’. 

And this, this poses a direct challenge to the economic promise of Brexit. The argument you’ll hear that if you speak to people inside Downing Street, Number 10 or Number 11, those people who work with Rishi Sunak, the Leave-voting Prime Minister, or Jeremy Hunt, the Remain voting and now ‘make Brexit work’ Chancellor, is that Britain can and will be more prosperous as a result of leaving the EU for two reasons. One is what’s known as “regulatory divergence” – or competitive divergence – i.e. by getting out of the EU with its meddlesome, one size fits all rules, the UK will be able to set less restrictive, more elastic requirements and standards for companies, and those companies as a result, will be more nimble, more innovative and successful. And the second reason is that in the 21^st century economy, geography doesn’t matter as much as connectivity; it’s not your neighbourhood that matters as much as your network.

But the problem is that these theories of the Brexit case make ever less sense; they’re increasingly unlikely to prove true. In the era of continentalism, geography does matter, we are, in business terms, where we are. And regulating products and services for our small, island market doesn’t put you easily in the game to do business in the big, continental economy on your doorstep. The collapse of British Volt, not least for lack of big car companies wanting to buy their batteries, makes the point: British businesses need continental customers. No wonder William Hague said Volt was a bad omen for Brexit. The point is that with Britain out of the EU, it’s not just out of Ursula von der Leyen $1 trillion in green tech financing but it’s on the fringes of the market of those green energy businesses that that money will create.

To be sure, the thought that I had in that conference hall was more of a question than an answer. It’s one of those moments you started asking yourself whether you’ve been asking the right questions at all. And then during the course of the week, as I’ve found myself saying to people that we’re not talking enough – frankly we’re not talking at all – about rejoining the EU, I’ve found you get these reactions:

–      First, you’re regaled with the history of the 2016 referendum; it’s explained, very patronisingly, why people voted the way they did, and why you’re out of touch if you still don’t understand that;

–      Or you’re told that talking about it is just pointless, politically. It’s not possible, because the Europeans wouldn’t have the UK back. It’s unhelpful, even unpatriotic. (One government minister said I was in danger of becoming “the other side’s Bill Cash”.) Or, for Remainers, it’s a tactical mistake: it won’t happen but will instead reawaken the hardline Brexiteers

But thinking about the case for rejoining is not about what happened in 2016, it’s not about revisiting the referendum or who the Leavers feel sold out Brexit since then. It’s about what’s best for Britain now and in the decade to come. The sovereignty gains have been, at best, symbolic, but even those who argued for sovereignty, those who said they were willing to forfeit some prosperity for control, they always talked about it as a short-term sacrifice for Brexit, not the long-term price. 

And, as for the politics, well that’s not my job. That’s not the job of a journalist. Too many of our politicians – and, it strikes me, too many of us in the media who question those politicians – well, they’ve got boxed in by the politics. Because the question for the UK two years after we left the European Union surely shouldn’t be how do we, in Boris Johnson’s formulation, make Brexit work; or, in the formulation of some in Labour, how do we make Brexit work better; it’s how do we make Brexit better than being part of the EU? That’s the test for Rishi Sunak’s government. Not can you come up with a compromise, but is your plan for the future better outside the EU than in it.  And if so, how? And if not, then what? It’s the question that forces us to think more clearly about what’s best for Britain: move on or rejoin? 

Have a very good weekend.