Thursday, 13 October 2016

Lifted directly from

2. Open up markets with key partner countries

We seek to create growth and jobs for Europeans by increasing their opportunities to trade with the world. This is particularly important in the context of current economic conditions.

One way of opening markets is to negotiate better access and conditions for trade and investment through free trade agreements.

The EU has concluded a number of Free Trade Agreements and is continuing negotiations with others.

I'm struggling here, stated EU policy appears to be in favour of FTAs, but where does it say "except with the United Kingdom of Great Britain and Northern Ireland"?

It's also well worthwhile following the first link to "trade and investment through free trade agreements", all good stuff but it doesn't exclude the UK there either.


Rich Tee said...

The whole thing baffles me. I agree with those who say: why do you need an agreement to trade? Trade took place for thousands of years without needing any kind of government "agreement".

Any "free trade agreement" is interference in free trade. Governments are more likely to restrict free trade than promote it.

Mark Wadsworth said...

RT: " I agree with those who say: why do you need an agreement to trade? Trade took place for thousands of years without needing any kind of government "agreement".

Lola and I myself have both said exactly that recently.

(Hence why I keep saying that VAT is the worst tax, it is like a 20% tariff on all trade, even within the same village.)

But we are where we are. So-called FTAs are still better than tariffs, quotas, embargoes etc.

Physiocrat said...

VAT probably results in an overall net loss.

* Administrative and compliance costs, estimated at 4.7% of yield, but I can no longer find the source of this figure.
* Taxpayers' money paid to people to pay VAT with ie churning. Pensions, benefits and public sector salaries are more than £300 billion. How much of that is VAT?
* Abstraction from other revenues which would have been taxed eg profits and rents.
* Deadweight losses, worth several per cent of GDP. A cut in VAT on restaurant meals from 25% to 12% in Sweden in 2012 resulted in the creation of 11,300 additional jobs. This resulted in not only a saving in unemployment benefits, but also an increase tax revenues.

Putting that lot together, VAT begings to look like a fiscal folly that no country can afford. Unfortunately it would take serious number-crunching to attach figures to all of the above.

Bayard said...

"Taxpayers' money paid to people to pay VAT with ie churning."

When I was a civil servant, it always baffled me that government departments had to pay VAT. When you think of the works budget of an organisation like the (erstwhile) Property Services Agency, 99% of it on VATable items of expenditure, it's just madness.

Lola said...

B. Or 'income taxes and NI contributions' on its staff salaries. Those employees are de facto on 'benefits'. (just to be a wind up...)

Rich Tee said...

I suppose that what has happened is that governments over the years have restricted free trade to protect their domestic markets (protectionism) and a Free Trade Agreement should more accurately titled a Removal of Barriers to Trade Agreement.

VAT always seemed to me like the initiation rite or tribute money of a club or gang. It is like "you must levy this tax to become a member of our club (the EU) to show you're tough enough/dedicated enough to join."

Dinero said...

> Mark Wadsworth

Good find. I too read it a few weeks ago, and was, as yourself, struck by the contradiction to the statements from UK politicians and commentary in the MSM.

Bayard said...

Lola, I always wondered whether I actually paid any income tax at all, since it was deducted at source by the government before they paid me.

Mike W said...

I agree with the points above, I use the 'all taxes are not the same', to intro LVT. Otherwise, folks cannot see the 'least bad argument' developed here. But just to make one side point.

'Or 'income taxes and NI contributions' on its staff salaries. Those employees are de facto on 'benefits'. (just to be a wind up...)'

But it is not a wind up. It's true, but we have to look at both sides of the structure.

I always argue that many of those on 'benefits' are not 'unemployed' they are civil servants.

An 'unemployed' has a social role like a judge, a Whitehall civil servant or a general. They function like court jesters and freaks in fuedal days. We pay them to be insulted, mocked and affraid of and often hated. They are where we fear to be. All of this important work and at the lowest salary of all! The government pays for this division and likes what it does in our society.Certainly the police, security and the social services value there work more than the frightened.

They need a uniform. I am thinking; scarey clown?

In contrast, as MMTers here know, a Warren Mosler type, 'job guarantee' is a perfectly rational way of using, willing labour, until the private sector steps up to the plate. Having lots of so called, Jobseeker contractors ( ie, they sign a contract they cannot turn down) is just a policy that helps our type of society tick along nicely.

So more flexible civil service and push through staff when the private sector is back on its 'boom' cycle.

Mark Wadsworth said...

MW, agreed on the valuable role of the unemployed in reminding people why its good to have a job.

I don't agree on JG of course, far too bureaucratic and expensive. Citizens Basic Income is much better.

Mike W said...

It is fitting you should mention Citizens Income. I was thinking of that too.Hoping you would bring it up. Not least, the key defense that you have already made. Let me remind you.

We are not savages we cannot just: Poor House, deport, starve, execute those who do not 'succeed', will not succeed, even in a Georgist State. (What the faux Libs/neo libs will do in the real world, as we know, always goes unstated)

In terms of a CI, we do not mean £20,000 a year and a free holiday to Disney World chucked in. We mean basically a non means tested £5,000-6,000, at todays prices. You have already pointed out not to be drawn into a Strawman, Swiss referendum situation, with the cost set stupidly high. Agreed.Done and dusted.
But what to do with those at the bottom who (we hope)do want more than this? I do think that some sort of JG is the answer, but with the same defense you have already given for CI.So to answer your point.
It cannot be set too high, (it cannot create a level of Lola's 'non-jobs' that CT cures as a nice side product) it will be the next step for thise who wish to enter the 'real' (free Market) labour force. 1 year for anybody wishing to work, so £6,000 + £6,000.Thats it, hopefully done at a city level. The state gets the best of these folks - the ones with the balls to actually get up and do this, back into the labour market and one year later, free enterprise hires them. Whats not to like? :)

Mark Wadsworth said...

MW, yes, £5000 to £6000 a year seems fair enough if it replaces Housing Benefit as well as normal Income Support/dole.

As to JG, doesn't the govt/taxpayer provide enough funding for education and training? Like 80% - 90% of the education system? Subsidising apprenticeships seems fair enough to me, that keeps people in the private sector, which is better able to judge demand. As long as employers don't just get rid of qualified workers and replace them with apprentices… It's a tricky topic.