Sunday, 28 May 2023

Selective statistics -- yet another example

We were assailed by yet another argument that Brexit has cost us dear this week, in a story reported widely and discussed solemnly as part of the growing luvvie consensus that it has all been a disaster.


Thank the Lord for Briefings for Britain again with this story today:

 

An updated paper from the CEP [Centre for Economic Performance at LSE] claims that 30% of the UK’s recent inflation was due to Brexit related non-tariff trade barriers. Catherine McBride reviews the trade data and finds that many other EU countries have seen similar increases in their food import costs, thus destroying the hypothesis that Brexit was the cause.  


...neither the newspaper journalists nor the economists at the CEP [thought]  to look at actual trade data from the EU food exporting countries...The CEP paper claims that UK food price rises would be 8 percentage points lower if the UK had remained in the EU. They blame this on the introduction of non-tariff barriers, but they come to this conclusion without looking at what has happened to the price of EU food exported to other destinations....food export prices have increased to most EU export markets, not just the UK....[Other]...potential reasons for price increases appear to have been overlooked by the CEP’s analysis. Price increases are rarely only about higher wholesale prices. 

 

However, there is still a cost of Brexit, estimated at £7bn overall since 2019. McBride argues that this arose because:

 

Many people mistakenly believed that the EU offered the UK ‘free trade’, but it didn’t. The UK had to pay for this access. This was doubly expensive as we were not only paying to give EU suppliers access to UK markets, but we also had to restrict UK market access to non-EU suppliers....Now companies that import or export goods to the EU must pay for their own compliance costs, just as they do when they trade with non-EU countries. These costs are probably passed on to UK consumers unless there is a competitive reason not to do so... So, it is possible that costs that were once part of the EU membership fee and so covered by UK government expenditure, are now being charged directly to UK consumers, but this is not an increased cost, in fact it is much less than our present membership fee would be if we were still EU members, we have simply changed how we pay it – at the supermarket till, rather than as tax.



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