There were two programme on the box over the last week about UKIP, and its probably not the sort of press attention they are looking for. Firstly there was the Beeb’s meet the UKIP’ers in which a group of generally angry old pensioners, in a deprived ex-seaside town, wandered around blaming foreigners (rather than budget airlines) for their town’s demise, constantly complaining about how they had to watch what they say in case the media labelled them as racist. Well that’s never been a problem for me! If you’re worried about accidentally saying something racist, that’s probably because you ARE a racist! I mean one of these guys, the local UKIP chairman for Farage’s constituency, was ex-National Front. Yet he seemed oblivious to the fact that this either implied he was a racist, or a complete brain dead moron to join an organisation like that, hang around with them for several years, surrounded by skin heads, giving the nazi salute, and it didn’t occur to him that they were more racist than a Chelsea supporter :no:
The other programme was C4’s UKIP: the first 100 days, which portrayed the effects of a theoretical UKIP government’s first hundred days in office. Needless to say, UKIP weren’t happy, giving them yet something else to be angry about. However I’d argue that actually Channel 4 gave UKIP a pretty easy ride, they failed to tackle the many obvious hypocrisies and unworkable policies within UKIP’s manifesto. My fear for UKIP won’t be the 100 days, it would be the thousand days after that as they would likely prove to be the last 1,000 days of the United Kingdom.
For starters there’s UKIP’s plans to leave the EU. I had a go at the Catalonians a few months back (and how unworkable their proposed independence was) and I’ve pointed out how one of the flaws in the SNPs plans, probably something that ultimately cost them the referendum, was their inability to answer basic questions about an independent Scotland. Well UKIP’s plans include many far worse howlers.
Trouble with Trade
So Farage wants independence from the EU, okay then and how long would that take to organise? You do realise youll need to negotiate a deal with the EU and thats likely to take time, and I mean a good few years? If theres one thing the EU doesnt do and thats work in a hurry.
As Ive discussed before, the economic consequences of leaving Europe would be severe. The, LSE predicts a significant drop in GDP, even in the best case scenario. So there would be quite significant job losses, as many of the UK’s companies rely on integrated manufacturing processes, which means tight co-ordination of manufacturing across the EU and the wider world. Any sort of interruption to trade will inevitably make it very tempting to move factories across the channel (or up the M6, or across the Irish sea), not least given the lower wages in certain parts of Europe (or lower taxes in countries like Ireland).
A crucial requirement of UKIPs plans, is to secure a free trade agreement with the rest of the EU and the EEA. However, that assumes the EU will grant such an agreement on terms UKIP would favour. And the likely terms of such a deal are already known…and they arent exactly UKIP friendly! They would require the UK agreeing to take on all EU law relating to trade and allowing free movement of people in support of commerce. In essence Nigel and his UKIP members presence in the EU parliament (and Britains veto over EU policy) will be replaced with a fax machine in Westminster, through which the EU will tell the UK parliament when to jump and how high. Regardless of your views on the EU, how could anyone consider this an improvement on the current status quo?
I repeatedly hear from UKIP types their prayer the EU has more of a need for the UK than the UK needs the EU. Well the economic figures say the opposite is true. Hence in these negotiations the EU will know it has the UK over a barrel and the UK will ultimately have little choice but to cave in. And even if it were true, the culture of the EU (which means they will not bow to threats from petty bigots, they made that mistake back in 1938 and we all know how that one worked out) prevents them from doing so. This was fairly obvious during the Eurozone crisis and recent events regarding Greece.
And its not just the EU UKIP would have to negotiate with but the US, China and numerous other countries, some of which have already warned the UK of the economic consequences in the event of Brexit. They would argue that the UK leaving the EU would be sufficiently disruptive to trade that it would invalidate any existing trade agreements. The US has already been very clear that they will exclude the UK from existing trade treaties if the UK leaves the EU. Inevitably the UK will not get the same sort of deal it got with the rest of the EU backing it up. After all, the Chinese cant play brinkmanship with the EU and risk being shut out of the worlds largest economy. But they can certainly afford to do so with UK, particularly when they know the UK cant afford to leave the room without a deal.
In the meantime the UK economy will be in limbo land. Inevitably investors will shuffle their cash off somewhere safe (Eurozone, US treasury bonds offshore tax havens, gold bullion, canned food ;D), investment will grind to a halt as businesses wait to see what happens next. In short economic paralysis. Inevitably interest rates will go up as the UKs credit rating is cut and inflation will rise.
This will mean in simple terms, that the interest on your mortgage will go up, as will the cost of living. But wages or the interest and returns paid to shareholders will not increase by nearly as much. This would be particularly bad news for anyone who has retired and is on a fixed income…So if C4 were being genuinely alarmist perhaps they could have shown UK pensioners living off food scavenged from bins and burning furniture for heat.
Government by chaos
Of course we have to factor in the UKIP factor to any negotiations. As UKIP have shown by their past behaviour, government by them would be chaotic, disorganised and gaffe prone, with much dictatorial micro-management by Farage. Consider how UKIP treats its own when they step out of line. Rather than any sort of enquiry or due process, there’s simply a dictate from HQ (usually by e-mail or text!) and the individual in question is pretty much taken out back and shot. There is for example, the jostling and backstabbing regarding party candidate selection. Or how Farage sacked the entire leadership of UKIP Scotland (including climate denier and former deputy leader Chris Monckton) when they failed to toe the party line and failed to perform.
Now all well and good this happening with a party whose basically in the Monster Raving loony category, but imagine it continues when some of them are minsters. The effect on any negotiations will be to drag things out, if not convenience other countries that the British have lost the plot, walking away from any trade deal until someone sane is in power. Naturally the effect of such chaotic and inept national leadership would have a severe effect on the stock market and the UK’s credit rating. This is why tin-pot dictatorships in Africa can’t get a loan, because investors never know whose going to be in charge when the time comes for the loan to be paid off!
Then there’s the possible breakup of the UK to worry about , how are UKIP going to handle that? The SNP have pointed out that Scotland would have to sign off on an EU exit, with similar noises coming out of Wales. This would likely mean either giving these region’s sufficient economic independence via Devo Max that they could effectively become an EU member themselves in all but name (which would of course render much of UKIP plans moot). Or fight with Hollyrood (and Cardiff) and trigger another independence referendum or two.
And what about Northern Ireland? The Good Friday agreement all but assumes an open border between the Republic and the North. Getting around that would mean negotiating with Sinn Fein, and we already know what their terms will be a referendum on reunification of Ireland. While polls do suggest a No, I suspect if such a poll were put in the context of an EU exit (i.e. youre expecting the non-sectarian voters who are currently saying No to maintain the status quo, to vote in favour of a tax increase, a cut in services and higher living costs just to stay part of the UK) theres at least a 50/50 chance of a Yes vote. How are UKIP going to deal with that one? And resisting it would probably mean reigniting the troubles.
It is for these reasons that I consider the greatest threat to the United part of the UK is UKIP. The UK self-destruction party would seem a better name for them.
Then there’s the labour shortages, its a pity this programme didn’t point out that if you arrest lots of migrant workers, well that does kind of mean they won’t be able to do their jobs. The whole reason why migrants are over here, is because there are labour shortages within the UK and thus jobs available and not enough people with the necessary skills to do them. Immigration from the Eurozone represents a net boost of £5-10 billion, which rises to £25 billion if we include the whole of the EEA.
Now its all well and good pointing to the many unemployed in jobs centres, but that’s not much help to an employer who needs a few hundred skilled brick layers or the NHS which needs doctors and dentists, or in my field where we need to bring in academics from abroad with expertise in a particular narrow field. I might add that this is why I support labour’s plans to encourage apprenticeships, as its this “reskilling” that’s a far more effective way of reducing labour shortages and unemployment, compared to beating up Romanian and Chinese immigrants.
Also, more often than not, the problem in the UK is there are jobs available, just not were people currently live. The main reason why immigrants are taking them is they are prepared to move and many British aren’t (for various reasons). This is why UKIP tends to poll well in deprived areas with relatively little migration, such as ex-resort towns in the South east.
So chuck people out of the country and suddenly you have crops rotting in fields with nobody to harvest them, engineering projects put on hold due to a lack of staff and NHS waiting lists increasing due to a lack of nurses and health care workers. And as I’ve discussed before there is a certain hypocrisy towards claiming to be right wing and in favour of free markets (as UKIP do) and then equally want to impose a series of massive trade barriers that will simply make it impossible for some British businesses to function.
Indeed the one set of jobs the programme showed UKIP, hiring ex-soldiers as immigration enforcement officers (which is based on actual UKIP policy), does actually show the nativity of the party. Most ex-army types I know would probably be insulted at the thought that the only thing they are good for is breaking down doors and beating up minorities. Many of them took the time in the army to develop various skills, be it management skills, IT, repairing equipment (electronics, mechanics), expert driving skills, etc. They have therefore gone on to get jobs in a variety of different roles (emergency vehicle drivers, health care, IT, engineering, etc.) and would probably be unsuited to this sort of a job (and probably not very fit anymore!).
And if you think I’m being alarmists, well I haven’t even started talking about the power cuts yet. The UK, and in particular England, is heavily dependant on imported energy. Half of the UK’s energy is now imported and the main source of domestic energy production is of course within Scotland, which might well be a separate country after Brexit. About 7% of the UK’s electricity is imported, mostly from European nuclear and renewable energy plants, which is crucial to making up the growing winter gap in UK generating capacity. Scotland is responsible for about 15% of UK electricity, as well as supplying most of the gas, either domestic gas or gas imports from Norway (the other major source of Gas coming in via pipelines from Europe). So the consequences of the UK leaving the EU would be to hand England’s energy fate into the hands of…well Scotland and the rest of the EU.
And while the other parties have been at least trying to pretend they are angry with the big six energy suppliers over the high cost of bills and lack of progress on the construction of new power stations, UKIP’s spokesman on this issue has suggested he is sympathetic to the power companies.
Again, it suggest enormous naivety and ignorance of the issue on the part of UKIP. They seem to believe that it is the fault of over-regulation by the government and that the only reason why the power companies build wind farms is to claim subsidy money. However if anything the opposite is true. Subsidies represent only a small portion of the lifetime costs of renewables (about 13%, so 87% of the cost of a wind farm comes from the energy company). The reason why power companies have been building them is because they represent a hedge against future rises in gas prices, with the subsidy intended to sweeten the deal slightly to hedge against drop in gas prices, such as has been the case recently. And most people would argue the reason for high bills is down to a lack of any effort to reign in the power companies, with Ofgem basically asleep at the wheel :zz:
The problem with energy is that it is a long term problem requiring long term solutions. It takes decades to build a power station or develop a new gas field and nobody in the right mind will finance such projects unless they are sure that the government isn’t going to change policy and render it unviable. The main political parties have been very good at making well meaning speeches committing to renewables, fracking, nuclear or whatever is the current flavour of the month, but then basically kicking the can down the road and not implementing the policies to bring about long term investment in the industry, hence the alarming drops in the UK’s generating capacity.
UKIP’s policy of taking their hands off the wheel and then letting the magic of the market solve everything would likely just lead to the big six giving us all a right royal shafting, building even less power infrastructure (after all, as ENRON showed in California, an artificial shortage means their profits go up) until the resulting blackouts get s embarrassing and disruptive that they force government intervention.
But any attempt by the state to solve such a problem would be problematic. While I’ve heard noises out of UKIP proposing to copy France’s policy on nuclear for example (which is again somewhat at odds with their supposed free market values), one has point out the decades that would take to implement, the massive numbers of foreign workers who would have to be allowed in to work on these projects (destroying any attempt at immigration quota’s) and the hundreds of billions it would cost. And whose going to pay those costs? The whole reason why Hinkley C is being subsidised (to the tune of 68% of the cost of every kWh) is because the markets refused to lend money to the project….and that was in an environment where gas prices were high and credit cheap. Farage will be trying to do the same when gas prices (and renewable prices) are low and credit expensive. How do you think that’s going to work out? So in short, vote UKIP…then invest in candle makers!
Again, Im not saying the UK isnt entitled to have a referendum on leaving the EU, but at the risk of sounding like Alastair Darling, independence would be for life not just for Christmas. And I dont think many UKIP supporters realise that. The UK would be paying a huge price for what ultimately will turn out to be a futile and meaningless gesture that will in all likelihood have the completely opposite effect that they intended.