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GRAYLING collarless

Chris Grayling is Leader of the House of Commons, and MP for Epsom and Ewell.

“It’s a privilege and an honour to address you tonight here on Capitol Hill at what is a crucial time for my country (and actually for both of our countries) and at a time when a fierce debate is raging about the UK’s future. I want to start by expressing my thanks to the team at Heritage and to George Holding for making this even possible.

I want to start by asking you to imagine a cold February evening in New Hampshire back in 2008. I want you to imagine a young senator from Illinois turning up in front of a crowd of potential supporters on a campaign visit to the state. And I want you to imagine him making a powerful speech advocating change for the United States.

It’s a tough and complex world, he might have told those supporters. No one country can stand alone. We have to face up to the challenges together. Of course we are a proud, independent nation, but there is so much more we could achieve. There is a better way for the future.

This, he might have told that crowd, is my vision for the future. We would be better off as part of an American Union of nations, working together to secure a stronger future for our continent. I want that Union to bring together all of the nations of North and South America. It should have its own Parliament, and the institutions needed to support it. That Parliament should be in a neutral location. What about Panama City – a place on the cusp of the two halves of the Americas? We should give that Parliament the power to make the majority of our laws.

It’s right that we should have common rules in areas like the way our workplaces operate, the hours that we work, the rules that govern our transport system, the way we manage our agriculture and our fisheries, the way we regulate our banks, the way we operate our sales taxes, the way we manage aviation – all of these things would be better done by an international organisation than by us here in the United States. Oh, and we should allow the other countries to outvote us and decide what happens here in the US even if we disagree with them.

There should also be Supreme Court of the Americas, perhaps in Venezuela, to outrank the US’s own Supreme Court, and to take decisions that will be mandatory in the United States.

We should even consider having an army of the Americas, and do away with antiquated ideas like the United States having its own military.

And to achieve this dream, he would have argued, we have to give every citizen of the Americas the right to live and work wherever he or she chooses across the whole of North and South America. Why shouldn’t every Mexican have the freedom to move to New York City if they choose. There shouldn’t be any restrictions on movement at all.

So if the young Barack Obama had come to New Hampshire and made that speech back in 2008, exactly how many votes do you think he would have got – in that primary and elsewhere? Not a lot, I suspect.

Suggesting that the United States should be part of such an organisation does not seem to me to be a political platform likely to command widespread support here.

But Ladies and Gentlemen, that is exactly where the United Kingdom finds itself today. We have joined such an organisation. It began as an economic partnership, designed to facilitate cross-border trade – in many ways just like NAFTA.

It has become something very different. It’s not yet a United States of Europe, though as I will explain, it is on that path. But it is closer and closer to becoming a single Government for Europe, and indeed many of its key players have that as a clear goal.

Given the issues that the Eurozone faces it is inevitable that it will reach the point of becoming a full federation.

Now from the perspective of the United States of America, an equivalent body on the other side of the Atlantic might seem theoretically attractive. People here in Washington regularly describe Europe in a way that suggests it is seen as a single entity. But I want to disabuse you of that.

The United States and the European Union may be comparable in terms of size, but they are very different. It is much more realistic to think of the comparison between different parts of the European Union in terms of the comparison between the USA and Bolivia, rather than the comparison between Nevada and Maryland. Different countries, different histories and languages, different cultures, different economies, huge gulfs between them.

It’s those gulfs in a continent that has tried to pretend that they don’t really exist that have brought the Eurozone close to collapse and led to social breakdown in many parts of the European Union. Greece has been the worst example, but there are others – youth unemployment in Spain, for example, is near 50 per cent.

So I want to tell you a little about what I think has gone wrong, about why the United Kingdom cannot and should not be part of what comes next, and why it is in the interests of the United States to stay outside the argument.

The seminal moment for the European Union came seventeen years ago with the creation of the single currency. In my view the countries that joined the euro created the economic equivalent of the San Andreas fault. They tried to create a single economy in a geographic area where there was no single government, no common culture or commonality of performance, and where the traditional escape valves when things went wrong in underperforming nations simply disappeared.

So the countries of Southern Europe ran up massive deficits, leading the life of Reilly off the back of a strong currency, whereas in the past the drachma and the lire would have fallen sharply on the exchange markets, forcing those countries back to a degree of rectitude. At its simplest, the Greeks retired at 55, ten years earlier than everyone else, and hoped someone else would pay the bill. And in the end someone else did – the Germans, the European Central Bank, and the IMF stepped in to prevent an all-out collapse.

But you can’t go on doing that. In a single currency area, if things look doubtful, the wealthy transfer all their money to safe havens in places like Frankfurt. The run on local banks brings them down, and the resulting collapse affects all. So no rescue is not an option.

That’s where the Eurozone finds itself now. And it cannot carry on that way. They’ve managed to stabilise things once, but it’s hard to see how they could withstand another major shock.

But there’s no easy solution either. You can’t just kick a country out of the Eurozone without creating that massive collapse either. If Greece had been forced out of the Euro, it would have been left with a devalued currency, unable to afford to pay its Euro-denominated debts. It would have defaulted and left massive losses across the continent. And then the pressure would have built up on other countries, and the contagion would have spread. And would spread if and when all of this happens again.

So the inevitable future is beginning to take shape. As my former Government colleague, the former UK Foreign Secretary William Hague once said, the Euro is like a burning building with no exits.

They have to make it work.

There had to be a bail out. But the rules must change. It’s as if the US was told to bail out Argentina, but had no control over Argentinian policy after the bail out. You wouldn’t do it. Nor will the countries of Northern Europe.
And that means political union. There is no other way. There has to be a single Government structure for the Eurozone. There has to be a United States of the Eurozone.

The plans are already taking shape. Angela Merkel, the German Chancellor, her deputy Wolfgang Schauble, the Italian Finance Minister, the French President Francois Hollande, the Speakers of the biggest Eurozone Parliaments, the Presidents of the big EU institutions have all called for political union. It means, according to Hollande, a Eurozone Parliament, a common budget and a common cabinet. Inevitably it means giving up independent nation status.

And in European terms that really does mean finishing our equivalent of that fictitious American Union – not just with a Parliament in Panama City, but with a single Government of the Americas there as well. Europe has no choice but to make its version of that fiction a reality.

It’s getting ready too. A new raft of European legislation, to harmonise a whole new range of powers currently held by member states, awaits us the other side of the referendum in June. There is a tidal wave of European integration ahead of us.

So where does that leave the United Kingdom. We did not join the Eurozone in 1999. Only 19 of the 28 members of the EU have adopted the Euro – but only two nations, us and Denmark – are not committed by treaty to do so.

We do not need to join the euro.

We do not need to join the passport free area of Europe that has caused so many debates during the refugee crisis.

We can opt out of some Justice and Home Affairs measures.

But the deal that David Cameron did in Brussels in February only cemented those opt-outs, and gave us a little extra protection against being sucked into a European superstate.

The EU will still make laws for us in the same way. We can still be outvoted on almost anything – and are regularly.

The European Court of Justice will still act as our Supreme Court.

All those same areas of our laws will be made in Brussels.

For example, it is the job of Brussels to decide on the working conditions in our factories and offices.

To decide on the environmental rules that can hold back the development of new housing estates.

To set the standards for our transport system as we travel to work.

To decide who can be defined as an asylum seeker.

Whether we levy a tax on tampons as a luxury product.

How our farmers work their land.

The rules that govern our oil industry in the North Sea.

How cancer research is conducted.

Laws on consumer protection.

How powerful vacuum cleaners are allowed to be.

The rules on fishing in our waters.

The aid that we can provide to struggling industries, like steel.

The hours that doctors work.

And on and on….

It’s a process that continues year after year. The European Union is governed under two documents, the Lisbon Treaty and the Charter of Fundamental Rights, both of which are vaguely worded. That vagueness allows a regular mission creep in Brussels to take control of more and more new areas of activity.

So when two heroic Americans wrestled a terrorist to the ground on a train in the Netherlands, the first reaction of the EU institutions was to insist that they should now be responsible for on-train security.

And as the member countries of the Eurozone move to unify more and more of the way they govern themselves, many of those changes inevitably will be applied to the UK as well – because we are already subject to EU-wide legislation in those areas. So if the Eurozone takes a decision about how to operate its banks, Britain and the City of London are affected by the same rule changes and we can do nothing about it.

As the Eurozone federates, and the EU becomes a single block with a single Government, what happens to the bit stuck on the edge? The UK. We will have little ability to defend our national interest. We will be outvoted all the time. But more and more of our law-making will be sucked into Brussels. We will be of marginal importance while footing a large slice of the bill. The US would never accept that. Why should it expect its closest allies to do so?

That’s why we must leave.

But where does that leave the United States, and our mutual friendship?

No two countries have worked more closely together over the years to secure peace, democracy and prosperity wherever we can, than the United States and the United Kingdom.

Some of the great international partnerships have been between the leaders of our two countries. Roosevelt and Churchill. Truman and Attlee. Thatcher and Reagan. Leaders who worked together to shape the world in which they lived.

We have stood side by side in two world wars, in Korea, in Kuwait, in Iraq and Afghanistan, and now in Syria as we work to tackle the threat of Daesh and to try to secure peace for that war-torn country.

We forged the NATO alliance in the aftermath of war, and stood firm with our allies to ensure that peace reigned in Europe and that the expansionist ambitions of the Soviet Union were successfully resisted.

Today the work that we do together to secure a more stable world continues as strongly as it ever has. Our intelligence professionals work side by side in a seamless battle against the threat of terrorism. Perhaps more than any two other countries on earth, we share the fruits of those labours in a way that strengthens our mutual security, and that of our mutual allies around the world.

But our relationship is about more than security. The United States is Britain’s biggest trading partner. The United Kingdom is one of the biggest international markets for US goods and services.

We share cultural roots. Year after year at the Oscars ceremony British actors, actresses and production teams feature high on the nomination lists. US TV is challenging the best of British on UK TV channels. Our people criss-cross the Atlantic to share in the experiences that each of us has to offer.

But above all we know we can always count on each other. Even when the United States faces challenges elsewhere, the relationship between our two countries remains vital to both of us.

When Barack Obama visited London in April, he made it very clear that he believes Britain should stay in the EU. A number of other US politicians have made a similar arguments. Often they have done so with honest intent and with what they believe to be the best interests of the United Kingdom at heart.

But the view from Washington isn’t really the best way of judging what is right and wrong for the United Kingdom, and I think President Obama was wrong to insert himself into the debate in this way. In the same way that the United Kingdom should respect the big decisions taken in the US, so the verdict on the future of the United Kingdom must be one for the people of the UK alone.

Inside or outside the EU, Britain’s relationship with the United States will and must remain strong. Neither of us should ever be at the back of the line when it comes to working together. If Britain chooses to leave, our partnerships in defence, in intelligence, in counter-terrorism, in trade and in culture should remain strong and unchanged. Neither of us would benefit from growing apart, and neither of us should want that to happen, regardless of how Britain chooses to shape its future.

We have a unique and special relationship that has survived changes of Government and changes of circumstance. That relationship will and must stay strong regardless of how the British vote in June. As David Cameron himself has said, I believe our best days together lie ahead.

And our friends here in Washington and across the United States should understand the challenge we face, and should stand aside as we reach our own best view about how we secure our future.

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