Removing all trade and tariff barriers as part of a hard Brexit would generate ‘a £135 billion annual boost to the UK economy’, according to Professor Patrick Minford on behalf of Economists for Free Trade — while those who claim his ideas spell economic suicide are ‘hired hands, they work for government, they work for big industry…’ Well maybe, as I frequently say: Minford talks of a 4 per cent GDP gain from free trade, 2 per cent from ‘improved regulation’ and more from reclaiming our net EU budget contribution and ‘removing the taxpayer subsidy to unskilled immigration’. All of which adds up to much more, for example, than the ‘best-case scenario’ of a 1.5 per cent GDP gain identified by the think-tank Open Europe before the referendum — since which it would be hard to argue that prospects have dramatically improved.
The truth is that one professor’s guess is no better than another’s, because there are so many variables, including the practicalities of repealing EU red-tape and the impact of other economic and political events. But if you’re willing to listen to a professor who disagrees with Minford et al but is no one’s hired hand (having left the Bank of England’s Monetary Policy Committee five years ago), I suggest you try my fiesty friend Adam Posen’s recent speech to the right-wing, free-market American Enterprise Institute in Washington.
Posen regards Brexit not only as economically crazy but ideologically perverse. Behind it, he observes no love of freedom but ‘an ideology that is ethno-nationalist, that distrusts free markets and competition… of course they have the right to do this, but do not kid yourself about the values behind it’. The Spectator should stage a live debate between Minford and Posen.
This is an extract from Martin Vander Weyer's Any Other Business, from this week's issue of the Spectator