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Brexit Goes Global: How Daniel Hannan Is Creating an International Free Market Movement

By: Daniel Raisbeck - @DanielRaisbeck - Dec 13, 2016, 8:43 pm

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EspañolNearly six months after 52% of Britons decided to leave the European Union on June 23, many see Brexit as the event that triggered an international populist backlash against a global, interconnected, and often self-serving elite. The aftershocks were felt in the US elections, in the Italian referendum, and even as far as Colombia. President Santos’s humiliating defeat in an October 2 plebiscite concerning his peace deal with the FARC guerrillas was Colombia’s “Brexit Moment” according to several observers.

How you determine the exact parallels between Brexit and the Colombian “No” vote in October depends, of course, on your sources of information.

A Tale of Two Referendums

In Colombia, as in the rest of Latin America, the mainstream media— establishment newspapers El Tiempo and El Espectador, weekly magazine Semana, and others—take their cue for world events from those whom they consider their first world equals: The Guardian, The New York Times, The Washington Post, The Financial Times, The Economist. It is hardly surprising, therefore, that the Colombian media portrayed the Brexit vote as the undisputed triumph of racism, xenophobia, and ignorance over decent, civilized life itself.

As a June 29 headline in El Espectador sermonized, “Brexit Is the Product of Europe’s Profound Racism.” This is a mere reflection of the official editorial line in most of the English-speaking progressive press. The Daily Beast referred to Brexit as “The Rise of Hateful Little England.”  “Brexit and Europe’s Angry Old Men,” ran the headline of a New York Times column. In a qu’ils mangent de la brioche moment, a Washington Post blogger even went as far as suggesting that “Brexit is a reminder that some things just shouldn’t be decided by referendum.”

Daniel Hannan, a Conservative Member of the European Parliament since 1999, visited Bogotá last week to present a completely different version of Brexit. Forget the “Little Englander” caricature of Euroscepticism; Hannan is a fluent speaker of Spanish and French whose vision of Brexit is both optimistic and globalist. He embodies what Lord Borwick describes as the “Big Worlder” view of Britain’s post-EU independence.

Hannan says the UK’s freedom from Brussels bureaucracy “is potentially the best thing to have happened in terms of revitalizing world trade,” especially at a time when global trade is falling and free market principles themselves are under threat, even in the United States.

While Hannan may not have anticipated the rise of Donald Trump and his brand of protectionism, he has been working toward Brexit since long before the term even existed. According to The Guardian’s Sam Knight, Hannan was not only a leading Brexiteer during the referendum campaign, he is “the man who brought you Brexit.”

During the long years which Britain spent within the European structure, Knight explains, there was only “a small, somewhat esoteric part of (the right wing of the Conservative Party)” working towards what became known as Brexit. It was

a sect of true Eurosceptic believers who dreamed and schemed for this moment for the last 25 years. Most worked for little else, with no reward, and with no sign that they would ever prevail…

And no one in that group worked with more devotion than Daniel Hannan…  Since the age of 19 (Hannan is 45), he has fought for what he calls British independence– fomenting, protesting, strategising, undermining, writing books, writing speeches and then delivering them without notes… Hannan may have contributed more to the ideas, arguments and tactics of Euroscepticism than any other individual.

The struggle was long and it involved a series of defeats before the final, unexpected victory. In the run-up to the implementation of the Lisbon Treaty, which heightened the pace toward “ever closer union” within the EU and was introduced surreptitiously after French and Dutch voters rejected a proposed EU constitution in 2005, Hannan would end every speech he gave at the European Parliament with Pactio Olisipiensis censenda est (“The Lisbon Treaty must be put to the vote”), a  “playful echo” of Cato the Elder‘s Carthago delenda est, or “Carthage must be destroyed.”

Although this annoyed the europhile majority of MEP’s, the Lisbon Treaty was rammed through parliaments without consulting voters outside of Ireland, where the EU staged a second referendum in 2009 after a majority rejected the treaty the previous year. Such heavy handed measures could only increase the EU’s so-called “democratic deficit,” alienating voters both in Britain and in other countries. The end result was Brexit.

For Euro-federalists, blaming anti-immigrant sentiment for their rout in Britain became a useful mechanism to avoid facing up to the consequences of their own arrogance.

When we speak in Bogotá, Hannan says that “if anybody tells you that the Brexit vote was all about immigration, I guarantee that you are speaking to a Remain voter. This is the impression not only in Latin America but in the rest of the world outside the UK.”

Brexit, he adds, “has been presented as anti-foreigner, or anti-immigrant. Believe me, if that had been the kind of campaign we ran, we wouldn’t have gotten close to winning. The top issue for Leave voters— we saw this in all our internal polls, and it was confirmed in all the published polls— the top issue was democracy.”

“Immigration was a very distant second, and even among the people who cited immigration, very few expect or even want a complete reduction of immigration from the EU. What they want is some control so that we are back in charge over roughly who comes in and roughly on what terms.”

There is a striking similarity between Brexit and the Colombian referendum in terms of voters’ true motivations versus what the global press chose to tell its audience. On October 10, The Guardian published a piece by Colombian novelist Juan Gabriel Vásquez, an arbiter of bien-pensant opinion, titled “Just like the Brexit vote, the Colombian referendum was corrupted by lies.”

A more precise comparison, however, would have been between the childish post-Brexit reactions of British “Remoaners” and the whining of Colombia’s defeated progressives after their shock setback—opinion polls predicted the Yes side would win with over 60% of the vote four days before they lost the referendum.

“When you come to Colombia,” Hannan says, “you find out that there were arguments on both sides, there were people who thought about it and came to a reasoned conclusion, yes or no. If you read the overseas media, you would think the only possible reason for voting No was because you didn’t want peace, and because you would rather return to conflict rather than risk any compromise with people you didn’t like. That’s the narrative and the same has happened with Brexit.”

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Latin America’s Opportunities in a Post-Brexit World

By obsessing about Britons’ supposedly anti-immigrant vote, the Latin American press has completely overlooked the economic case for Brexit, including the major opportunities that have arisen for Latin America itself. As Hannan has often explained, the EU is not a free trade area, but rather a customs union:

A free trade area is a common market, within which goods, services, capital and sometimes labour can circulate without hindrance. Examples are NAFTA in North America, EFTA in Europe and ASEAN in South East Asia. A customs union, by contrast, surrounds itself with a common external tariff, and conducts all trade talks on behalf of its member nations.

Take the case of EU policy on sugar imports. As Andrew Gilligan wrote in The Daily Telegraph in 2013, the EU’s Common Agricultural Policy

is massively biased towards sugar beet because it is grown in Europe, and the world’s largest beet producer, France, is the country whose farmers have traditionally dictated the policy. The sugar beet industry benefits from generous quotas, mandating that a given proportion of production must be beet…”

“Sugar cane, by contrast, only grows outside Europe. Since 2010, the CAP has drastically restricted its import to protect French and German sugar beet growers, slapping on tariffs of up to £300 a tonne.

Even though British firms such as Tate & Lyle preferred to import sugar cane from Latin America and other regions at world prices, the EU shackles prevented them from doing so. This not only hurt sugar refineries and their workers, many of whom were fired due to Brussels overreach; it also meant that EU consumers had to pay higher food prices. The system was rigged so that the International Confederation of European Beet Growers, a powerful special interest group, could hold on to its privileges without having to face global competition. Cronyism rarely succeeds as thoroughly as it does in the European Union.

Brexit, however, will allow the UK to buy sugar at world prices once again. Producers in Colombia and other Latin Americans countries should be preparing for the opportunity, and the same applies to all other agricultural industries which, like Argentinean beef, have lost the British market due to decades of EU protectionism.

Brexit as a Start-Up

For Hannan, Brexit not only brings an opportunity for Britain to trade with other countries; it also means that global trade itself can be done differently. The post-Brexit UK can be a “start-up” of sorts, bringing innovation to the mired field of 21st century free trade deals.

We talk so much about globalization, we’ve missed the globalization of the NGO movement, the extent to which NGO’s have learned how to make use of these trade talks to extend regulation. And so trade talks now are about ecological standards, and child labor, and women’s rights, and everything except trade. I’m all in favor of a green environment, I’m all in favor of women’s rights, but that’s not what we’re talking about. What we’re talking about is removing barriers and obstacles, shifting the rocks so that the grass can grow.

Hannan says that, after Brexit, Britain “can avoid some of the errors that were creeping into recent trade deals.” Particularly, the Trans-Pacific Partnership (TPP) between Pacific Rim Countries and the failed Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US, two major initiatives of the past decade, were more about harmonizing standards and protecting big business than about free trade.

“In TTIP and in the TPP,” Hannan states, “you had cartels forming, you had corporations on both sides getting together and pushing for more regulation so as to raise barriers to entry. We should get away from all of that. We should just say, ‘look, if something is legal in your country, it’s legal in ours, and viceversa.’ If we do that, we can revitalize the whole stalled world trading system.”

After winning the Brexit vote, Hannan sees his personal mission as “making sure that we get this right.”

There’s no point in leaving the European Union if we replicate the corporatism, and the protectionism, and the cronyism. The whole point of taking back control of our policies is that we can make it work for everybody. We can make Brexit an event that delivers for us but also for our partners in Europe and also for the rest of the world.

Ideally, a bilateral treaty between the UK and Colombia, for instance, would be negotiated quickly and the final agreement would include no more than 10 pages. “It would say, if this drug can be sold in the UK it can be sold in Colombia; if I’m qualified to practice as an architect in Colombia I can practice in the UK. Done. Everybody wins.”

“Mutual product recognition rather than common standards” should be the model for post-Brexit trade in Hannan’s view. “Trade in other words that is for the consumer, not for the producer.”

This is why Brexit can bolster the global free market: “we can do something that so far only Hong Kong and Singapore and New Zealand have done, which is to open our markets across the board in textiles, in food” and other areas.

Like journalist Allister Heath, Hannan, who considers himself an Old Whig, is essentially calling for a 21st century version of the repeal of the Corn Laws, a series of “tariffs and other restrictions on imported grain” which “blighted Britain between 1815 and 1846”. Like EU agricultural regulations, the Corn Laws “pushed up prices, impoverished consumers… reduced the demand for other goods and services, and enriched landowners at the expense of everybody else.”

Heath notes that “the campaign against the Corn Laws was the first morally driven, libertarian middle-class mass movement, demanding free trade, globalisation and popular choice and freedom.” Hannan thinks that, once outside the EU, Britain can reclaim its mantle as the world’s foremost promoter of market liberalism. And this will happen at a crucial time:

The new Prime Minister Theresa May at every opportunity says: ‘I want Britain to be the global leader in free trade.’ And I think this is really important. We’re not going to get that from Brussels, and in the next four years we’re not going to get that from Washington. So somebody has to be out there making the case for open markets.

Exporting Brexit Requires a New Global Movement

For Brexit to succeed as a global force for good, the free market vision which Hannan represents must triumph beyond Britain. His visit to Colombia and his previous stop at Guatemala’s Universidad Francisco Marroquín were part of his current mission “to bring together a movement and, where appropriate, political parties who share the vision of property rights, the rule of law, free markets, and individual autonomy.”

The battle is already being fought in the realm of ideas, where market liberalism faces an international onslaught on both the Trumpian-Le Pen right and the Bernie Sanders-Jeremy Corbyn left. Hannan’s priority is “to try and combat what is currently the prevalent mood in the world, which is that free trade is somehow an exploitative tool.”

If you look at all those idealistic young people protesting against G-20 meetings and occupying Wall Street, they’ve got it into their heads that the free market is a mechanism for white people in rich countries to exploit brown people in poor countries. And it’s extraordinary in a way that they should think that because, until now, free trade was always the great radical cause.

If you go back 100 or 200 years, the kind of person who wanted free trade usually was the kind of person who wanted to end the privileges of the church, to not have authoritarian monarchies, to have opportunity and meritocracy. How bizarre that just at the moment we can see free trade working and delivering, and free markets opening the world and bringing an end to poverty in Africa, that somehow it’s become seen as a mechanism that helps the rich few rather than the many.

Hannan understands that the defense of the free market, whose main beneficiares “are poor people in poor countries”, cannot afford to limit itself “to just a few European and North American think tanks with some decorative motifs from South America.” The global movement Hannan is creating in order to win the argument for global trade has to “genuinely reflect world population and the shift in productivity in the planet to the south and the east.”

Surely, critics of so-called “neoliberalism” will scoff at the idea of making the case for laissez-faire economics “among the people who can’t yet afford washing machines and TV sets.” The main lesson Hannan draws from Brexit, however, is “that people are wiser than their leaders: we were told that the day after we voted to leave the sky would fall in, and people didn’t believe it. And people were right not to believe it.”

“If you look at what has happened since the vote”— falling unemployment, British stocks outperforming European ones, companies such as McDonald’s moving from the EU to the UK, even a recovering pound— it is clear that “the threats that were made turned out to be wrong.”

The great advantage for free marketeers is that, as Hannan notes, capitalism is “the system that goes most with the grain of human nature; almost all of us have an instinctive sense of property rights. And if we can win that argument then life is going to get better and better.”

Daniel Raisbeck Daniel Raisbeck

Daniel Raisbeck is the PanAm Post's Chief Editor. He ran for Mayor of Bogotá in 2015 as an independent candidate. Follow him @DanielRaisbeck.