| Sometimes the European Union resembles this marvellous old house. Impressive looking, but on rather shaky foundations. It’s an old Mayor’s house in a town we visited in Portugal. They’ve been trying to get around to repairing it for about twenty years, but politics and finance and red tape is getting in the way. So it’ll stay this way for a few more years yet. I don’t know if you’ve noticed that when journalists talk about the need for “structural reform” in an economy, they seldom go into detail. It’s harder to explain than interest rates or levels of debt. But for most economies it’s the more important issue, certainly in terms of generating an efficient, sustainable, dynamic economy. |  |
In Japan, Shinzo Abe is still trying to advance his reforms...
The Japanese Prime Minister has had some success in making things easier for women to enter the workplace. His efforts to make it easier to invest in the energy and agriculture industries are making slower progress.
Quite rightly, there’s a debate about the social impact of any deregulation, but too often policy makers simply give up on change rather than try to press a way forward.
So, instead, Japan tries things it can make happen more easily, like pushing interest rates into negative territory - which could have terrible consequences, and won’t stimulate growth by themselves.
Yet reforms needn’t be as ambitious those making the headlines in Japan.
At a recent investment conference I hosted, debate turned from the consequences of Britain leaving the EU for Britain, to its consequences for the EU… And then we looked at how fit the EU was, in itself.
 | Speaking at the conference (I can’t tell you all of his thoughts, to be fair to delegates), former trade minister Lord Tebbit talked about the need to “Get out of the burning building before it collapses”. And I found myself thinking of three conversations about the little things that are wrong with Europe - rather than macroeconomic policy, or myths like a ban on curved bananas. |
Take Jane, who runs a gift shop in Portugal - who gets her goods from Southern Africa and Southern Asia via London, rather than Lisbon. Progress though customs and the rest in Lisbon can take four months - in London just a week or so.
Or Veronique, whom we met in Vientiane, buying local fabrics for her outlets in Paris. Again, a hold-up in Paris, where they changed their minds about how her textiles should be labeled.
Or on the customer side, how about Patricio, who’s moved to Southern Italy, only to find he can’t buy an Italian car there, as a foreigner, nor register a foreign car locally. He’s also been obliged to buy private medical insurance, in order to claim residency - this is illegal under EU rules. Anyone who challenges this compulsion, in court, wins - but the system does not change.
And I’ve lost count of the number of plumbers, electricians and builders I’ve talked to over the years who find it hard to move from one jurisdiction to another and do their jobs easily, fitting in with local rules and ways of doing things - whatever freedom of movement might seem to offer skilled EU citizens.
Surely if rules were followed consistently, or rationalised, or restrictive practises were eliminated, there would be more jobs, not fewer; greater growth, not less? And this is where national governments are being allowed to fail, damaging the EU project.
I’m not sure whether Norman Tebbit’s right to say the EU is a building on fire.
But it needs more than a lick of paint over the cracks. It needs attention to detail.
Or Veronique, whom we met in Vientiane, buying local fabrics for her outlets in Paris. Again, a hold-up in Paris, where they changed their minds about how her textiles should be labeled.
Or on the customer side, how about Patricio, who’s moved to Southern Italy, only to find he can’t buy an Italian car there, as a foreigner, nor register a foreign car locally. He’s also been obliged to buy private medical insurance, in order to claim residency - this is illegal under EU rules. Anyone who challenges this compulsion, in court, wins - but the system does not change.
And I’ve lost count of the number of plumbers, electricians and builders I’ve talked to over the years who find it hard to move from one jurisdiction to another and do their jobs easily, fitting in with local rules and ways of doing things - whatever freedom of movement might seem to offer skilled EU citizens.
Surely if rules were followed consistently, or rationalised, or restrictive practises were eliminated, there would be more jobs, not fewer; greater growth, not less? And this is where national governments are being allowed to fail, damaging the EU project.
I’m not sure whether Norman Tebbit’s right to say the EU is a building on fire.
But it needs more than a lick of paint over the cracks. It needs attention to detail.
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