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The Draghi Report on EU competitiveness highlighted the way the EU economy is falling badly behind the US this century. Sky high energy taxes and prices, and an anti high tech company set of law codes and taxes have kept the EU in the slow lane. US GDP per head is growing faster and is now 80% higher than the EU. The UK has been dragged down by EU laws and taxes, and has only grown a little faster than the EU since Brexit owing to its failure to change suffocating EU rules and charges. It has managed to avoid some of the latest unhelpful laws of the EU but is stupidly putting itself into the carbon taxes, emissions trading and carbon based tariff schemes which help make energy so dear.
A study by the European Centre for International Political Economy in 2023 set out how US GDP per head 47 % higher than EU in 2010 surged to 82% higher by 2023 based on cheaper energy and better technology. It showed how the major economies of Germany, France, Italy and Spain were falling further down the league table compared to US states. It is getting worse as the US accelerates its highly successful data centre and AI investments. The EU is becoming a digital colony of the US whilst protesting and seeking to constrain and tax the US companies it relies on for so many purposes.
The story of this century shows UK voters were right to vote to leave the damaging EU which has been holding down growth and living standards. This government’s wish to bind us closer to a failing economic model is bad economics and worse politics. We need much cheaper energy and we need to liberate our tech sector. No to CBAM, no to EU emissions trading, no to EU net zero madness, no to the digital tax, no to more tariffs on non EU imports, no to energy dependence on EU imports, no to the big fish give away to the EU...
This note by our Advisory Council member John Redwood was first published on his website on 3 August
Click here to read the Draghi Report and here for the ECIPE report.
