It is striking how the use of certain terms distorts underlying concepts and impairs understanding. The current debate is characterised by a supposedly sharp divide between “soft Brexit” and “hard Brexit”. The defining difference is whether the UK remains part of the single market.

Whenever it is suggested that we might go for so-called “hard Brexit” it is widely assumed that our economic future will be worse. The underlying idea seems to be that the single market is economically good. Accordingly, if the UK rejects membership of it, this must be because, either we are mad, or we value certain non-economic – and political – objectives more highly than economic prosperity. Prime among these are the control of immigration and the restoration of sovereignty, including escape from the clutches of the European Court of Justice. Accordingly, much of big business, and especially the City, favours “soft Brexit”, implicitly putting prosperity before politics.

But is it clear that membership of the single market is such a good thing? Most of the world – including the US, China, Canada and Singapore - does not belong to “the” single market nor, come to that, to any other single market. Yet they seem to be rubbing along all right.  Meanwhile, the members of the single market are not doing so well.

Most of those economists who supported Brexit and wanted to leave the single market – including yours truly – did not make this choice because they believed that certain political gains outweighed economic losses. They believed that in the long run, if not also immediately, leaving the single market would deliver the best economic result.

This should not be surprising. Along with single market membership comes three significant negatives. Prime among them is the need to submit to all EU rules and regulations. Britain’s leading business organisations have been berating us for years about how cumbersome and costly these are. Why have they now apparently forgotten this?

Second, if we belong to the single market we are unable to manage our own trade relations with countries outside the Union. We have to impose the EU’s common external tariff and are forbidden from forging trade deals with them.

Third, we have to pay a membership fee, amounting to about 0.5pc of GDP per annum.

Those business people and institutions who are confident that belonging to the single market is such a good thing are, on the whole, the same as those who were confident that a vote to leave the EU would bring immediate economic pain. When will they learn that the single market is not all that it is cracked up to be? The UK’s economic interests are not the same as those of established businesses as perceived by their short-termist and self-interested leaders – and loudly proclaimed by their myopic and blinkered lobby groups.

David Fuller's view

This is a brilliant and also droll column by Roger Bootle.  I commend the entire article to you, and feel free to pass it along to nervous ‘Remainers’.   

“Hard Brexit” may feel like a leap in the dark but it is probably far more sensible than a long, protracted and expensive negotiation with a dysfunctional EU of 27 nations, which have no experience of a departure from the Union, and which some may choose to take personally.  Once out of the EU, the UK can propose sensible trade terms with individual European nations and common sense would be more likely to prevail.  Meanwhile, the UK will be simultaneously pressing ahead with trade agreements elsewhere around the globe.  

Here is a PDF of Roger Bootle's column.