A letter to the Spectator magazine which was published on 23rd September 2006.

Your contributor David Rennie (‘It’s funny what you can pick up in Iceland’, 16th September) greatly overcomplicates the basic issues surrounding Britain’s possible withdrawal from the EU with his talk of rejoining the European Free Trade Area (Efta).  What most long-term opponents of Britain’s membership of the EU actually wish is for the UK to be in the same relationship with the EU for economic purposes as are the USA, Canada and Australia, whose aggregate trade with the EU is about the same as Britain’s, and for which they pay the EU absolutely nothing.  The constant reiteration of the phrase ‘access to the Single Market’ as the benefit for which Britain pays about £10 billion gross is thus totally misleading.  The EU’s external trade is regulated by its membership of the World Trade Organisation in which, after withdrawal from the EU, the UK would resume its place as a fully independent member.  World trade in goods is in any case practically tariff-free, while since 1995 the WTO has systematically extended transparency to the trade in services.

From a global trade policy and regulation point of view the EU, like EFTA, is now to all intents and purposes irrelevant.

A paper written on 25th March 1993, but not originally for general publication. It is included here because it shows the author’s progress of thought on this subject and the time scale.

1          Change in Establishment View about Manufacture

Alarm about the state of British manufacturing has now gripped all but the most unreconstructed City circles, but the alarm is largely inchoate.  Barely five years ago political, financial and journalistic circles maintained almost to a man that a rapid decrease in manufacturing as a proportion of the gross domestic product was in some ways “natural”, even perhaps the hallmark of an advanced economy, where Britain would once again be pointing the world towards its future.  With a trade gap of £15-20 billion in prospect for the recession year of 1993, following on an accumulated deficit of over £30 billion from the previous two years, this proposition is exposed as the ridiculous viewpoint it always was.  In three years then, in the depths of a demand-based recession, the average British family unit has accumulated a foreign debt of around £2,500 or 15% of its annual income.  Before a remedy can be proposed it is necessary to analyse briefly why the proposition about the relative unimportance of manufacture is, and always was, so absurd, as this writer and a few, but very few, others have argued over the years.

2          The importance of Manufacture for Britain

Broadly any nation can make a living in the world from four natural resources – its land, its sea, minerals under the land or sea and its brains.  For a country with nearly 60 million people, living on about 60,000 square miles of reasonably habitable and cultivatable land above 50 degrees North, having only one significant mineral resource (oil), its brains will have to provide the bulk of its income.  Even a 50-100% tariff on food form tropical and subtropical regions of the world has not discouraged the population from importing a massive percentage, possibly 30%, of its food from these regions, while living and working for 48-50 weeks of the year above latitude 50^o North and subject to 30-100 inches of rain per annum will ensure a massive deficit on tourism.

Oil and gas extraction contribute around 2.5% to national income – a proportion which is likely to decline.  Oil and gas extraction in UK waters, and mineral extraction generally, pose a particular problem in another sense however and that is that the available price is set overwhelmingly in regions of the world where extraction is fundamentally easier, so that relatively small price shifts can close a large portion of the British industry down overnight.  The coal industry poses the present example, but world price reduction of $5 per barrel would threaten half of North Sea production.  There is no salvation, nor has there ever been salvation, in North Sea oil.

2.1       Britain’s dependence on brains

A major objective of national economic policy – as for any prudently managed business – must be to reduce the vulnerability of the nation’s economy to factors beyond its control even – and this is a key point – at some sacrifice of short-term advantages.  For this and the preceding reasons Britain is dependent on its brains and always will be for the vast bulk of its income.  Many will nod agreement and add “skills” but here it is worth recalling a phrase of King Alfred, written (in English) almost exactly 1100 years ago: “That which is done unthinkingly cannot be reckoned a skill”.

2.2       The Manufacturing Multipliers

The fundamental reason for the importance of manufacture in Britain’s economy is that via its enormous replicating ability it is overwhelmingly the vehicle for brains – German brains, Japanese brains, American brains – and potentially British brains.  It is for this reason that the overwhelming majority of traded products are and will continue to be manufactures.  Using data from the chemical, computing and aerospace industries certain ratios can be established which may be termed the manufacturing multipliers:

M₁:       One unit of design effort embodied in capital plant provides about 40 units of saleable product.

M₂:       One year of designer’s effort embodied in capital plant provides about 30 man-years of semi-skilled employment.

Contrary to received wisdom the values of M₁ and M₂ indicate that manufacture, in Britain’s geographical situation, is both the main engine of wealth and directly and indirectly will continue to be its main source of wealth creating employment.

Of course for M₁ and M₂ to apply at their maximum values capital must be forthcoming to embody the designers’ efforts – in a word his brains – and the capital must be managed efficiently.

2.3       The Principal Reason for British Failure in Manufacture

While much attention has for 20 years or more been focussed on labour productivity, there is abundant evidence that it is capital inefficiency in both senses – the embodiment of brains in the initial investment and the subsequent management of that investment – which is the most important factor distinguishing British manufacturing industry disadvantageously from its chief rivals.  Because funds available for reinvestment are particularly sensitive to capital efficiency, practically the whole of the shrinkage of British manufacture relative to its principal competitors can be attributed to this feature which is today the responsibility solely of corporate management. That there are baneful influences in Anglo-Saxon capitalism bearing down on British managements is indeed true, but will singular and outstanding exceptions, British corporate managements are composed of men whose mentality is that of traders – people who are happiest when buying other companies’ technology (i.e. their brains) and markets, using money borrowed from banks and shareholders – rather than applying themselves to the hard graft of thinking, analysing and developing their own technology and products.  While there are many examples to choose from, that of BMW is one of the most instructive.  Here is a company which 30 years ago was about the size Jaguar is today, whose subsequent organic growth to about half a million vehicles per annum owes nothing to City-type expertise, but everything to the services of a dedicated and determined management, schooled in the technology of car design and manufacture.

2.4       Scale of the Failure in Manufacturing

Overall the hard fact must be faced that by and large the leadership of British industry has in the last 30 years or so, with as I have said outstanding exceptions – pharmaceuticals and chemicals among them – been a gigantic failure.  It has allowed itself to be expelled from whole areas of manufacture – machine tools, printers, copiers, plastics machinery, instrumentation, electromechanical gear of all descriptions, heavy trucks, most domestic equipment, heave construction equipment and a whole host of everyday items.

To answer those who say market losses were inevitable, it is worth reflecting that if Britain had the same share of world manufacturing as France has (about 7%) it would have a trade surplus bigger than its current deficit and unemployment well below a million.  It is a significant commentary on political attitudes that reference is always made to Britain’s share of world manufacturing trade (about 8.5%), but it is total manufacturing that counts.

Because the source of failure on the current scale is attributable to the corporate management class, heavily influenced by the financial system, and because something so entrenched will neither be changed overnight, nor even be inclined to recognise its own failings, the best that can be expected from it over the next ten years or so is to hold on to Britain’s existing world manufacturing market share (4%).  Even this objective will require a major shift in attitudes among those presently in control.  The significance of Japanese investment is that it injects just the required change of attitude, but the injection is essentially that – a projection of Japanese corporate attitudes, not a change in British ones.  However at best this will, for the reasons given above, only keep Britain in permanent trading deficit – which will have to be paid for eventually by the gradual realisation of its overseas assets (basically the 1980s’ oil revenues) or the progressive sale of domestic assets (chiefly companies and real estate as found on the West Coast of the USA and Canada) or both.  Just as serious a consequence will be the institutionalising of massive (around 10%) unemployment (the present levels is about 15% of genuine jobs).

3          Radical Change

It is the view of this paper that such a prospect for a great country is not to be contemplated, that the threat to our survival as a nation is greater than any in our long history, and that being so, every current belief, shibboleth, alliance, relationship, commitment, practice, must be subjected to the stringent test: “Does it help or hinder us in our fight for industrial survival?” and if it hinder us, it must be discarded or bypassed.  Everything, but everything, must be subordinated to winning the industrial war.

3.1       A National Objective for Manufacturing Expansion

Wars are won by setting difficult but attainable objectives.  This paper proposes that over an eight year period manufacturing industry should be expanded by 35% net.  This would bring manufacturing’s direct share of GDP to about 30%, broadly the figure which applies to Germany.

This would add £50 billion to GDP directly and via the multiplier add another £50-100 billion in total.  It would require at current manufacturing technology, additional investment of around £120 billion, or about £15 billion per annum.  This corresponds to an approximate doubling of current levels of manufacturing investment.  It represents however a mere £500 per insured adult per annum and should be compared with the nearly £2,000 per insured adult per annum which Germany is paying (or rather not paying) for bringing former East Germany up to West German levels.

At current technologies the additional employment in manufacturing industry would be about 0.8 million, which merely replaces the loss in the last six years.  Further employment of 1-1.2 million would be created in the services supplying the new manufacturing industries, making 1.8-2.0 million all told.  In essence the main part of our chronic unemployment problem would be solved.

3.2       How the objective can be achieved

3.2.1    Human Resources

At current technologies and wage levels an investment of £15 billion per annum over eight years requires about 120,000 qualified people to design, construct and subsequently run it.  This is about half of the current membership of the major engineering institutions.  However only 50% of engineering graduates enter industry.  That is about 15,000 per year who do not.  Thus contrary to received opinion there is a vast pool of inexperienced, but qualified engineering professionals in the country, and it is probable that a disproportionate number of the ablest have entered accountancy and finance which at the end of the day create nothing.  In addition there are probably 100,000 qualified and experienced engineers in the prime of life, eking out a living as consultants, advisors to government quangos, reluctant teachers and refugees in the further and higher education sectors.  In addition the country is awash with unemployed time-served experienced mechanical craftsmen of all descriptions, many of them from defence-related industries under the threat of further large-scale closures and redundancies.  In short there is no lack of human resources for the envisaged expansion.

3.2.2    Creation of new firms from scratch

Just as in another emergency Kitchener raised his New Armies in 1915-16, so we must create a New Army of firms from scratch, using the human resources defined above.  Members of the existing corporate establishment (with outstanding exceptions) must not be, repeat not be part of this venture.  (The outstanding British (Australian actually) general of the First World War, John Monash, was an engineer by profession, and even Haig recognised that officers from the non-military field performed on average better than those from the traditional military caste.)

Taking the average manufacturing firm as having the following characteristics: £20 million capital, £20 million turnover, £10 million added value, a staff of 200 of which 10 are engineers and 10 other professionals, we need to create at this scale about 1,500 firms per annum.  Of course over time many of these will grow so the need to seed will reduce.

3.2.3    Market targets for the new firms

These should be based on a detailed expansion of the list given in 2.4 of the markets from which Britain has largely or entirely been expelled.  The business schools should be called on to donate 50% of their staff time to doing a real job of work, namely to producing, industry by industry, sector by sector, a market plan for British manufacturing firms at the £10 to £50 million per annum turnover level.  Before any firm is set up this essential staff work must be completed.  Included within this will be the need to define sales networks for both recapturing the home market and capturing overseas markets.  To support the national objective of £15 billion additional manufacturing product, approximately 5,000 man years of effort will be needed, but there is bags of resource for this – to be found not only in the business schools, but among the mass of technical research degree takers which have at best only peripheral scientific, let alone commercial, relevance.

3.2.4    Paradigm for the creation of new firms

The central enabling step is the establishment of several Manufacturing Institutes with a mission defined by broad categories of industry.  The unique feature would be both the scale – each would be responsible for about £1 billion of new output per annum – and the fact that they would be a combined business and teaching establishment.  They would have responsibility for launching the new firms.  Instead of doing artificial case studies, students – who would be qualified engineers and scientists of any age – would be the managers and directors of actual new firms, starting not at the one or two man scale, but at the 50-100 employee scale.  Each Institute would also be the home of a General Staff for its industry sector, assembling and commissioning the market plans referred to in 3.2.3.  This general staff would not be made up of failed members of the present corporate establishment, but would be staffed by people having two essential qualities: an absolute dedication to reconquering lost markets and the technical knowledge of the manufacturing processes to achieve this.

The leaders of the new firms would bid for a given market segment on the basis of their personal qualities, not their access to finance, which would come through the Institutes.  They would be paid a good salary together with shares, which if the firm reached the £10 million per annum added value, would make them paper millionaires.  Restrictions on selling out would be imposed.  Mistakes would be made, but the release of youthful energy targeted by the experience and dedication of older people would rejuvenate the whole nation.

3.2.5    Where would the cash come from?

We are talking of £500 per annum per insured person, about the sum spent on foreign holidays, about two thirds of that currently spent on support of the unemployed.  If implemented, this plan would make the DTI and regional aid largely redundant, releasing about one third of the required cash.  My proposal is that the money should come initially from a combination of %0% savings on the DTI/regional aid and a savings levy in the form of industrial credits – at the rate of one penny on basic tax rates, five pence on higher rates, the restoration of a new 60% top rate, plus 50% on merchant bank profits – which could be encashed at some future date.  This would give the general public a stake in the success of the plan.  Individuals could nominate which manufacturing institute they preferred – machine tools, plastics machinery, textiles – whatever.  Because the focus would be initially at least on conquering the lost home market, credit holders would have a built-in incentive to buy British and to know precisely where to address their complaints if the quality were not good enough – but it will be; I have no doubt of that.

A paper written in December 1990 for a Gresham College Conference.

It shows the importance of high standards in teaching and learning and the way to achieve them.

To read the text please click on the link More Matter Less Art which will take you to the paper on the Britain Watch website.

A letter to the Times which was published on 28th April 1990.

Ronald Butt said (article, April 25th) that it is inconceivable that Britain should leave the EC.  But why is it inconceivable?  Politicians in the original EC Six have repeatedly said they want plitical union – a United States of Europe.  Why not believe they mean what they say, rather than keep asking what they really mean?

What they mean is a sovereign republican Government to which national governments would be subordinate and to which foreign countries such as the USSR and USA would accredit their diplomatic representatives.  The Queen, while remaining the supreme symbol of law-making and parliamentary sovereignty in 10 other Commonwealth countries, would no longer have that role in Britain, her native land.

It is perfectly pointless therefore for the British Government to join in talks on political union, if it is determined, as the Prime Minister and Mr Hurd have repeatedly said, to uphold the sovereignty of the Queen in Parliament – an undertaking incidentally which every MP swears to uphold.

Instead of a futile effort to deflect the deep-felt wish of many Continental countries to unite, the Government would better spend its effort in thinking through Commissioner Andriessen’s proposal last year that Britain and Denmark should resume membership of a European Free Trade Association, enlarged to take in the countries of Eastern Europe and linked to the EC in a wider European Economic Space (EES) as he suggested.

This proposal offers us: retention of our independence; free trade and technical co-operation with the whole of Europe; removal of the huge drain on our balance of payments represented by the European Community charge (£4.5 billion last year); escape from the common agricultural policy; freedom to make our own trade agreements with our historic trading partners in the rest of the world; relief from the everlasting EC wrangles.  What more could we possibly want?

A letter to the Editor of The Field magazine which was published in November 1989.

It was written in answer to a letter from Martyn Bond, Head of Information Office, European Parliament, London, SW1. This followed an article by Professor Bush published in The Field in their August 1989 issue which you can find in the Papers and Articles Section.

Mr Bond wrote in his letter: “The Single European Act was not ‘smuggled through the British Parliament despite the misgivings of the Prime Minister’. It was approved by 319 votes to 160. The Prime Minister herself voted in favour.”

Mr Bond also wrote: “Professor Bush asserts that ‘many decisions in the Council of Ministers are taken now on the basis of one country, one vote’.  In fact, fewer are now taken on this basis than in the past, and more are taken on a weighted basis, according to a key unanimously agreed by all member states and ratified.”

Mr Bond also wrote: “Professor Bush asserts that ‘Britain’s trade with Sweden, a non-EEC member, and theirs with Germany is as free as Britain’s with Germany’.  This is nonsense, as repeated attempts by other members of EFTA to become full members of the EEC have shown including Austria’s current application.”

Mr Bond also wrote: “He [Prof Bush] continues, ‘None of the improvements in our manufacturing industry in the last few years owes anything to the EEC entanglement, any more than Germany’s industrial renaissance did.’ Both assertions are false, ignoring the importance of markets (potential demand) in investment decisions. More representative and well-informed sources (CBI and Bank of England) argue a case opposed to Professor Bush’s in their surveys and reports.”

Stephen Bush replied:

If Mr Bond had cared to consult some of his fellow countrymen up and down the country in April to July 1986, he would have found that few would have ever heard of the Single European Act which was passed through Parliament in that short time.  Contrast this with the exposure given to the current Health White Paper.

Readers will have appreciated that the weighting in the European Parliament I referred to was by countries, and to repeat – seven countries with a combined population of 51 million have around 134 seats to Britain’s 81 for a population of 57 million.

Virtually all of the tariffs on industrial goods in trade between European Free Trade Association (EFTA) members and the EEC were abolished on 1 July, 1977.  In 1988, per head of population, Sweden exported £440 worth of goods to Germany, while the UK exported £170.  Sweden has a policy of not joining the EEC.

Markets are an essential feature of investment decisions, but I deny that the power-hungry European Commission and Parliament are needed to supply this ingredient.  Product quality and market knowledge are the overriding factors as the success of Japanese goods testifies – despite the barriers that were erected against them by the EEC.

Rather than rely on blind faith about the EEC I prefer to use my eyes.  While 85 per cent of our colossal manufacturing trade deficit (about £14 billion in 1988) is with the EEC, our trade with our single biggest customer, the USA, is fundamentally in balance, in fact £2 billion in surplus in 1987.  Whatever ‘informed opinion’ in the CBI may tell Mr Bond, its own members invest most of their overseas capital in North America, not in the EEC.

A letter to the Editor of the Daily Telegraph which was published on 4th July 1989.

Mr Heseltine (letter June 29th) conspicuously declined to answer my question about what limits, if any, he would set on the transfer of British sovereignty to Brussels.  Instead we have the usual obfuscation about all alliances imposing constraints on a nation’s freedom of action.

Most people, however, can see the difference between an alliance like Nato with its specific and limited objectives and the Single European Act which, inter alia, allows the 11 other members of the Council of Ministers to issue instructions to Britain on matters that have nothing to do with free trade, which was what the British people have been led to believe was the objective of joining the EEC.

As for the EEC being a means of avoiding economic domination by the United States and Japan, Mr Heseltine should contemplate the make-up of our colossal manufacturing trade deficit, 85 per cent of which is attributable to our trade with the EEC (chiefly Germany).  By contrast our trade with our biggest customer, the United States, is fundamentally in balance, as it has been through the years of our mounting deficit with the EEC.

A letter to the Daily Telegraph which was published around the 3rd December 1986.

Your educational correspondent, David Walker, needs to learn a few facts about foreign educational systems before he extols their virtues.  For instance, American public high school education is widely regarded there as a disaster.  Talk about their breadth and lack of specialization is the merest tommy rot: lack of anything would be nearer the mark in many cases.  The result is patent – American university faculties and laboratories full of the products of other countries’ education systems, especially our own.  So far as Japan is concerned its later secondary and tertiary system is atually more specialized that our own at comparable levels of attainment.

Breadth and attainment level in fact must be looked at together.  Thus if you examine the content of the 18+ French Baccalaureat or German Abitur examinations you find that their vaunted breadth is at a level which, particularly in the sciences and mathematics, is basically O-level.  Of course only a minority anyway of French and German children pass the examination sufficiently well to go on to university successfully, just as only a minority pass a broad range of O-levels adequately in this country.  The difference is that in Britain, basically that same minority does it at 15 or 16 and goes on to study in school three or four subjects at a level which in other countries is carried out at university.  It is this efficiency which is the reason why our country produces honours degree graduates at 21 who can hold their own with the products of foreign systems who are two to three years older.  It is the current inefficiency of their system which is causing the French Government to tighten entry standards to their universities by insisting on a closer match between school and specialist university subject choices.

There is actually no conflict between maintaining A-level and university standards and seeing that the below average part of the population get a decent school education and a work related follow-up, which is what Lord Young’s YTS certificates represent.  What is needed is a disciplined effort in the schools to match the efficiency of the A-level system at lower levels, not to wreck the one part of the system which is genuinely world class.  The no-fail philosophy of the GCSE is hardly a prescription for taking on the Germans or the Japanese.

There is nothing highfaluting about academic standards, particularly in the technical sphere.  As Correlli Barnett has analysed in “Collapse of British Power”, it was the Victorian cult of the “practical man””, bereft of theoretical knowledge, which bears a major responsiblity for the pathetic state of British industry in 1914, from which it has never completely recovered.

A letter to the Daily Telegraph which was published on 9th July 1985.

Your leaders on June 27th and July 1st once again implicitly accept the fundamental differences between Britain and the two key EEC countries, France and West Germany, yet refuse to draw the obvious conclusion that we should withdraw from that organisation.

However much you may wish to believe that the Continental countries are not really serious about a European union, the fact is for different reasons they are.  For France, the EEC is seen as a vehicle to promote French concepts and projects – Ariane, Airbus and now Eureka; for Germany, the EEC is a stage on which to regain political pride.

Britain figures absolutely nowhere in their thinking except as a country to be alternately despised, exploited or envied.

France and Germany can, and will, advocate the abrogation of the veto, confident that no proposal will command majority support which will really damage their ambitions.  Britain, however, would look forward to a sequence of decisions which will damage us individually as people and collectively as a nation.  The GAP, the fishing and budget settlements and now the car vehicle emission standards agreement are all immensely damaging to our interests, and this is soon to be followed by pressure to remove immigration controls on arrivals from EEC locations.

The tragedy for Britain is that we endure all this for absolutely nothing.  The ritual incantation by politicians like Mr David Steel (June 27th) who have no practical industrial experience, about the benefits of the EEC’s 320 million common market, doubly miss the point; first all European countries whether in the EEC or not are already linkined within an industrial free trade are; second the benefits of such a market are unquantifiable and, in any case, overshadowed by other factors which lie entirely within the competence of individual natios.

West Germany’s economic success owes absolutely nothing to the EEC’s exisence and everything to having a resolute, technically competent managerial class backed by a trained disciplined work force and a banking system which sees its first duty to support its own manufacturing industry.  The extent to which the British economy has improved of late is the extent to which these three factors have become more widespread.

Again, the technological benefits of large units are vastly overstared by politicians eager for roles to play.  With the possible exception of a moon-shot and certain nuclear missile projects, there are probably no technological goals outside the competence of an industrial nation of 60 million people.

As a recent visitor to centres in the USA engaged in the Eureka technologies, I can say that Americans certainly do not regard their size as conferring any particular advantage.  On the contrary, in the vital computer field for instance, the world’s most powerful commercial computers and the best work stations are both supplied by relatively small firms staffed by gifted individuals.

Sooner or later the political establishment, which long ago lost faith in Britain, will have to allow the British people to confront a stark choice: cease being an independent nation, or let the EEC go its own way to union without Britain.  When the present British passport, which for millions of people is the symbol of our nationhood, is suppressed in about 18 months’ time, just before the next General Election, the present Government will find that in the interests of yet another damaging Euro-compromise it has grievously offended another large section of its natural support.

A letter to the Editor of the Daily Telegraph which was published in February 1983.

Your leading article and the commentary on the City Page (Feb. 21st), like many others, follow the oft-repeated view, also built into most if not all models of the British economy, that there is little if anything to be done to revive the British economy without the long-awaited upturn in the United States economy and revival in world trade generally.

But does this view not lay too great a stress on foreign trade as virtually the only source of inflation-free growth?

With anything from 40 per cent to 90 per cent import penetration in the major categories of the manufacturing sector (valued at about £55 billion annually), it is clear that a determined across-the-board attack by British manufacturers on the British market, aided by a Government employing the same measures to restrict imports as our trading partners do, would be the single biggest contributor to reducing domestic unemployment.

A 10 per cent reduction in manufacturing penetration would correspond to about 300,000 direct jobs alone, even allowing for present under-used capacity.

It is usually objected at this point (as implicitly in your City Comment) that the resultant strong pound would make imports cheaper and exports dearer again, thus largely offsetting the quoted employment gains.

But this objection ignores the fact that the United Kingdom, alone among the major industrialised economies, can, if it wants to, control the trading balance outside the manufacturing sector, without using fiscal means, by varying the extraction rate of oil.

Oil at the present rate of extraction is the great exporter of British manufacturing jobs.  One day’s production of North Sea oil shipped to West Germany keeps 1,000 West Germans in jobs for a year just on converting a fraction of that oil to chemical and plastics products, a large proportion of which are then shipped straight back to Britain to contribute to the import penetration quoted above.

In fact, the oil extraction rate should be seen as a control lever in the economy which we have never had before.

With central government revenues now under control, the opportunity exists to use this control to engineer an import substitution-led revival of the British economy, to a considerable extent independently of the decisions and difficulties in the economies of our principal trading rivals, the United States, Japan, West Germany and France.

A letter to the Editor of the Daily Telegraph which was published on 3rd November 1982.

The Rt Hon Geoffrey Rippon (Oct. 29th) and Mr Christopher Tugendhat, in their efforts to prove the impossible, namely that the European Economic Community brings economic benefit to this country, continually confuse the issue of EEC membership with the issue of free trade in Western Europe.

They know very well that the European Free Trade Association (EFTA) countries negotiated tariff-free industrial trade with the EEC as long ago as 1973.  British trade with Switzerland, for instance, is as free as it is with West Germany or France.

In fact, British exports to Switzerland rose 6.4 times in the seven years to 1980 compared with six times for the EEC excluding Britain, and unlike the EEC this is a trade which is fundamentally in balance.

As for American and Japanese investment location preferences, these are far more to do with pre-existing geography and English language and local workforce skills than with EEC quangos.

It is laughable to suppose that were Britain to leave the EEC, the EEC would in some sense shut Britain’s exports out.  Preferential access to Britain’s oil and her home market are far too valuable for the Nine to imperil them by some sort of spiteful trade war.

What would be imperilled by Britain’s withdrawal would be the jobs of dispossessed British politicians, but I think Britain could survive that.