The exit from the single market closes a chapter the UK has done so much to write – Financial Times

When Big Ben hits 11 p.m. on New Years Eve, the UK will leave the European Single Market. It will be a moment of national catharsis – and as in Greek tragedies – a moment when the triumphs of the protagonist’s past catch up with him.

Because the roots of Great Britain’s rupture with Europe are born of its greatest European victory: the success of the transmission to Europe of a British economic ideology and above all a conservative one of eliminating bureaucratic barriers to trade. The Single Market was to a large extent created by British Conservatives.

“Just think for a moment of the prospect this represents,” Margaret Thatcher told an audience of British business leaders at Lancaster House in 1988, when she was Prime Minister. “A single market without barriers – visible or invisible – giving you direct and unhindered access to the purchasing power of over 300 million of the richest and most prosperous people in the world. Bigger than Japan. Bigger than the United States. At your doorstep. And with the Channel Tunnel to give you direct access. “

Thatcher was the political force behind a truly unified European market for goods, services, labor and capital; Arthur Cockfield, the Brussels commissioner she appointed in 1985, was its intellectual architect and bureaucratic engineer.

The motivation was pretty clear. When Britain belatedly joined what was then known as the European Economic Community in 1973, economic integration mainly took the form of a customs union, known as the ‘common market’ of the United Kingdom. Union in which tariffs between members have been eliminated. Those who saw economic benefits for Britain were vindicated, with membership quickly ending Britain’s long underperformance as economic growth caught up with its European peers.

However, the common market remained riddled with obstacles, as divergent national regulations made cross-border trade expensive.

And upon his arrival in Brussels in 1985, Cockfield set out to suppress them. Its White Paper on “Completing the Internal Market”, one of the most important documents in EU history, presents a compromise between “harmonized” pan-European rules and “mutual recognition” of national rules. Just as the British might once have wanted a simple system of mutual recognition, Cockfield realized that politically it would never work without a base of minimum common standards. Where appropriate, common rules for the single market would therefore be adopted – by qualified majority of Member States rather than unanimity, to avoid a political deadlock – with national leeway to shape detailed implementation when that is possible.

Cockfield has enjoyed remarkable success. The Single European Act of 1986 enabled single market legislation by qualified majority. Hundreds of legislative measures were then passed quickly, and by early 1993 the single market was a reality and most border controls disappeared.

However, the UK started to degrade on its own creation, even before it was created.

An irritant was present from the start. For continental leaders, the elimination of capital controls meant that only monetary unification could prevent monetary instability that would distort trade or jeopardize cross-border investment. As the slogan said: “One market, one money”. This link was never accepted in Great Britain. In the long run, this deepened a divergence of interests between the UK and eurozone members, which would manifest itself sharply after the global financial crisis and David Cameron’s ill-fated attempt to negotiate new terms for membership. from Great Britain to the EU.

But other consequences of the single market were those the UK not only accepted, but wanted. Yet he soon had doubts about them.

Shortly after Lancaster House, Thatcher delivered what would become the Bruges Speech, a foundational text for British Eurosceptics. The ambition of the European Commission for a “social Europe” had awakened her to the danger, as she saw it, of having “succeeded in pushing back the state borders in Great Britain, only to see them re-imposed at the level European with a superstate exerting a new domination of Brussels ”.

If this had happened, it would have been an effect of the very method Thatcher and Cockfield had advocated: the development of common rules by decision by (qualified) majority. The prime minister who pushed for common rules to remove trade barriers found it difficult to accept that a majority of others may have different ideas on what should be the best common rules for free trade. At the same time, the Labor Party has warmed towards a European integration that it had previously rejected.

Another implication of the single market project was the growing role of the European Court of Justice. When there are common rules, there should logically be a common arbiter to know if the rules have been respected. But it increasingly categorized the loudest British Eurosceptics as offensive to sovereignty. Even for Prime Minister Boris Johnson, a long-time supporter of the Single Market, the ECJ’s final say in interpreting much of the law that regulated the UK economy appears to have been genuinely intolerable.

Then there is the more toxic part of the 2016 referendum campaign. Part of the betrayal myth about the UK joining in 1973 is that people only joined free trade. , and not to a freedom of movement imposed later by stealth. But the ability to work anywhere in the bloc was part of the EU’s founding credo, as was well understood in the UK membership debates.

The single market has nevertheless made the aspiration for free movement of workers a reality by removing bureaucratic and legal barriers to movement. Then, in 2004, Eastern European countries joined the EU, supported by the UK, which was also one of the few countries to forgo a transition period before Europeans from the East get the full right of free movement. Millions of workers took the opportunity to come. The transformation of the UK labor market and demographics has given Eurosceptics their most important issue to campaign on.

It was all about wanting the end but not the means. British Conservatives were successful in liberalizing trade across Europe, then found that what they really wanted was a strict conception of sovereignty. Mr Johnson’s Christmas Eve trade deal gives them that – but at the cost of restoring all the trade friction Thatcher and Cockfield had managed to remove. This could settle the matter if the self-proclaimed British “natural government party” had now made up its mind. But with Brexit associated as much with a global free-trade Britain as it does with a sovereign Britain, no one can know whether the deal will resolve these tensions permanently.