The Prime Minister’s latest reason for Brexit is that it will let the government bail out bust firms and buy British products. Did he learn nothing from Margaret Thatcher?
The Tories used to think it was a bad idea to prop up ailing businesses. They used to think this amounted to pouring good money after bad. They used to think this distorts the playing field – and disadvantages new nimble firms that don’t need subsidies. And they were right.
The Tories used to think protectionism was a bad idea too. Buying British would mean taxpayers paid more for goods and services than they needed to. And they were right.
They believed these things so passionately that they wrote the EU rulebook on state aid, competition policy and public procurement. They wanted fair competition rules across the whole continent. So British firms could prosper in other countries without having to compete with foreign companies that had been propped up by state aid. So they could get access to contracts from the German, French and Italian governments on the basis of merit rather than nationality. And they were right.
Now Boris Johnson is throwing all this out of the window. For no good reason. Except perhaps to garner a few extra votes in this miserable election.
But it’s worse than that. If the Prime Minister really embarks on a new round of state aid and protectionism, he will make it even harder for the UK to trade with the rest of the world.
Why would the EU want to keep its markets open to us if we are subsidising our lame ducks? Why would it be as keen to have access to our market if we are giving our own firms a leg-up – and buying British at the expense of Swedish, Dutch and Spanish producers?
And why would the Americans, Canadians, Japanese, Australians and so forth want to do deals with us too?
Why indeed?
