Multinational corporations love regulation because they’re big enough to cope with the costs, while the regulatory thicket acts as a major barrier to small companies, start-ups and new businesses— Roger Helmer MEP, Head of UKIP delegation in the European Parliament
•I wrote recently about the high volume of mail which we MEPs are receiving from concerned citizens about TTIP (the proposed Transatlantic Trade & Investment Partnership), and I expressed the view that their concerns were premature, because we don’t yet know what the Treaty – if it is ever agreed – will say. Most commentators believe it will be years, not months, before we have a final text, and that will be the time to decide whether the benefits outweigh any disadvantages, and whether to vote for or against.
But I recognise that the concerns expressed are genuine, and I am struck by the way that most specific concerns relate straight back to the broader worries that many people feel about the EU as a whole. The anti-TTIP campaign may be motivated by protectionism and anti-Americanism, but it has some genuine points — the NHS, ISDS, the dangers of empowering large multinational corporations, and the secrecy surrounding the negotiations. Let’s think them through.
NHS: We’ve been assured by just about everybody on this side of the Atlantic that the British NHS will be protected. If the UK was negotiating directly with the US, you can bet that the NHS would be at the top of the minds of British negotiators. But for the EU, it’s merely one issue for one out of twenty-eight member-states. Important, yes, but just part of the negotiating furniture to be horse-traded between the parties.
Indeed this gives the lie to those who say that with the strength of the EU’s size and numbers, we can negotiate much more favourable trade deals than by going it alone. Exactly the reverse is true. EU negotiators are in the unenviable position of having to trade-off the conflicting concerns of 28 EU member-states, before they even start trying to accommodate the negotiating position of the other side. Far from adding strength, this structural conflict critically weakens the EU position. We’d be much better off with a bilateral deal (and but for our EU membership, we’d probably have had one decades ago).
ISDS, the influence of multinationals, and lack of transparency: Opponents of TTIP fear that ISDS, the Investor/State Dispute Settlement régime, will unduly empower multinationals, and enable them to “ride roughshod over the democratic decisions of member-states”. I think that concern is overdone – after all, ISDS has been a commonplace of free trade agreements for years, and if properly drafted shouldn’t be a problem.
But there is a much broader issue of the willingness of the European Commission to listen to large companies. Multinationals keep hundreds – perhaps thousands – of lobbyists in Brussels, and they wouldn’t carry that cost if they didn’t think it would deliver. There is a curious symbiosis between large corporations and the EU. The corporations need to influence the Commission, and to do this effectively, they have to sing the Commission’s tune – especially in two key areas. This is why big companies support (publicly at least) EU integration, and oppose Brexit. And this is why they support the orthodoxy on climate change. More than once I’ve heard spokesmen for big-name companies talking publicly about the importance of fighting climate change. But catch them afterwards over a beer, and it’s “Well Roger, you understand why we have to toe the corporate line in public, but my own view is quite different….”.
This symbiosis (or at least convergence of interests) is also driven by the consensus on regulation. European Bureaucrats love regulation — it’s what drives their careers, pads out their CVs and justifies their posts. Multinationals love regulation because they’re big enough to cope with the costs, while the regulatory thicket acts as a major barrier to small companies, start-ups and new businesses. It’s a barrier to entry. So both the Commission and the corporations love heavy-handed regulation, even though it damages the wider economy.
This is one of my key concerns with TTIP. As I have written before, tariffs on manufactured goods are already low, and TTIP’s benefits are therefore likely to come from non-tariff barriers, which implies regulatory convergence. But regulatory convergence is a two-edged sword. Of course it’s daft that the same corporation needs to prepare its accounts on two separate bases to satisfy both European and American rules, and it would increase efficiency if we had common standards. If regulatory convergence is accompanied by a determination to minimise the regulatory burden, well and good. But the danger is that every player wants to put his own bauble on the tree, and you end up with a dog’s breakfast. Some opponents of TTIP argue that regulatory competition has its benefits too.
I will certainly want to satisfy myself on this point, and to be convinced that benefits out-weigh costs, before deciding how to vote on the final package.
As for lack of transparency — well that’s what the EU does best. It has thousands of specialist committees meeting behind closed doors and determining policy (don’t imagine for a moment that the European parliament makes the rules).
So I hope that one point is crystal clear — for those with serious concerns about TTIP, the EU, and our membership of it, is part of the problem, not part of the solution. While in theory trade deals have to be ratified by each member-state, in practical terms there are huge pressures on every member-state to toe the line, and as EU members we may be forced to accept a TTIP deal that isn’t right for Britain. If you’re worried about TTIP, be sure to vote “Out” in the Referendum — and we’ll maybe get the bilateral UK/US trade deal that we should have had years ago. Roger Helmer MEP