Senators, it is my honour to address this house for the second time as EU Commissioner. I was due to be here in February, but circumstances intervened! The whole country had to batten down the hatches and wait for the snowstorm to pass, before getting on with things when the weather improved.
If you will forgive my use of weather metaphors, both Ireland and the EU have had to weather some heavy storms in the last decade. First, we were battered by the global economic crisis, which almost brought Ireland to its knees and forced the EU to drastically recalibrate its priorities.
Thankfully, that particular storm is now in the rear view mirror, and today we are meeting in better times. The European economy has picked up, with Ireland leading the charge.
EU economic growth hit 2,7 per cent in the final quarter of last year and should hit 2,8 per cent this year. Investment is picking up; the employment rate is above 72 per cent – higher than ever; unemployment is down – 10,3 per cent three years ago, 7,3 per cent now. In the four-year lifetime of this Commission, the economy has created nine million extra vacancies – a big achievement.
The European economy grew faster than the US for the first time in years last year.
A heavy storm forces you to check the strength of your foundation, and that is what the EU has done.
The Commission under Jean-Claude Juncker can and should claim a fair chunk of the credit for this recovery, through successful large-scale investment programmes financed by the European Investment Bank; improved coordination of EU countries' economic policies; and the Social Pillar which promotes fair working conditions, equal opportunities and greater social protection for EU workers.
These actions are helping to storm-proof the European economy, helping Member States to withstand future crises through deeper reforms. Economically speaking, the wind is in our sails.
But another storm appeared on the horizon in June 2016, and we are still waiting to see the final cost of its impact, particularly here in Ireland.
Brexit was a hurricane force storm. It caused an existential panic at the heart of the European Union, and there was a real fear of a domino effect that would tear the EU apart. By late 2016, Eurosceptic forces were on the rise across Europe, polling well in a number of key elections, egged on across the Atlantic by the new American President Donald Trump.
The EU's response was smart, and proportionate: check the foundations and see what defences need strengthening.
President Juncker initiated a bottom-up process to see what type of Europe our citizens want, going forward.
I am very glad that Ireland is playing its part. The Citizen’s Dialogue on the Future of Europe has a programme of discussions and consultations that will continue all around the country up to Europe Day on May 9th.
The government is making its own contribution to the Future of Europe debate, and so is the Joint Oireachtas Committee on European Affairs. This is to be warmly welcomed, and I commend the members of this house for their contribution.
The EU institutions have been shaken from their slumber and there is a noticeable new energy and desire to get things done. In a world of rising nationalism and retrenchment, the EU is occupying the space vacated by others to lead from the front across multiple policy areas.
We are now the unquestioned global leader in promoting open, fair and rules-based trade. In the last 2 years we have signed important new deals with Canada, Japan and Singapore, and earlier this week I was delighted to announce an agreement with Mexico. Many of these deals are immensely positive for our agri-food producers, pharmaceutical sector, and financial services - which is very good news for Ireland.
Size matters in trade, and as the world's leading trading bloc, the EU is in a position of strength to build mutually beneficial agreements with our global partners. I will return to this point later.
We are also driving the global agenda on climate and sustainability, which remains the single greatest challenge of our time and one to which this country needs to urgently step up its contribution.
And we are trying to relight the flame of Europe's enlightenment values, making truth and reason relevant again in a world of mistruths and "fake news".
Yet again, Brexit is important here.
EU membership was a successful policy in the UK too – accepted as such by the majority of politicians and commentators. But that didn’t stop a majority of people voting to scrap it.
And that is strange. Because one thing the Brexit story has shown is that the UK does not have an alternative policy to EU membership. Not by a long shot.
Even Brexiteers are happy to keep one foot in the EU: security, transport agreements, and continued participation in some of the EU agencies all spring to mind as examples.
However, the fact remains that people in the UK voted to leave. We, as politicians, might think that successful policies will always commend themselves. Evidently, it is not so. Successful policies need to be defended. Brexit has taught us a sharp lesson.
Understanding this, and incorporating it into our political life, should be one part of our stocktaking. We cannot take for granted that people will like the EU just because it works.
But, perhaps we can go a stage further, and ask how everyone failed to spot the disconnect arising between citizens and their representatives – a disconnect that dominates so much of our politics today. How did we allow our public discourse to be dominated by fake news and half-truths? How can we begin to remedy things and stop it happening here?
Here, again, Brexit is a lesson.
Because another thing the Brexit story has shown us is a brand of politics in which:
concern for people’s real well-being has gone out the window;
the soundbite has become more important than the truth; and
people can “groom” a majority to act against its own welfare.
In short, we now have a brand of politics and commentary that, all too frequently, misleads rather than leads.
It is remarkable that a successful UK economy is determined to be divergent rather than convergent with its neighbouring countries.
If we look a little more widely, we see it is not only Brexit. Our political arguments are becoming coarsened and are having knock-on effects on our behaviour. One sign is the trigger-finger readiness of so many people to play the immigration card, even the race card.
Much of this is the result of “fake news” – the way in which what we used to call tall stories and gossip no longer goes from mouth to mouth but from one set of fingers to a million sets of eyes. With a tap on the keyboard. Brexit shows us how vulnerable we are.
This is why the Commission is alerting Member States to the dangers, advising them to set up an infrastructure that can counter the lies and half-truths. The respected Irish Independent editor-in-chief Stephen Rea is making a sterling contribution to this work, having been appointed to the European Commission's high level expert group examining the issue of 'fake news'.
And next year’s election to the European Parliament gives this added significance and urgency.
We must be on our guard.
My final thought on this is to underline the difference between bad publicity, contrary opinion and fake news.
As politicians we know all about bad publicity and contrary opinion. It comes with the turf. We deal with it. But we do it in the world of truth.
We have been slow to recognise that fake news is something else. It is not bad publicity; it is not contrary opinion; it is not in the world of truth. It is a fiction; a harmful fantasy. As I say, it is urgent that we find the way to reveal it for what it is. Political mischief. The wrecking ball.
These are the positive actions taken so far by the EU to withstand the Brexit storm, but of course that storm has not yet passed.
If we look ahead for the moment, to the post-Brexit Union, one thing is already becoming evident, the changing relationships between Member States. The disappearance of a Member State, and a large one at that, makes this inevitable.
Ireland will be separated from a friend and partner in EU discussions. We joined what was then the Common Market together – indeed it was unthinkable that one of us should join without the other – and have worked together on many of the major issues. Now Ireland has to reconsider its role, its objectives, its relationships. Sometimes, for example, starting next year, we shall be speaking for the whole island.
The development of new relationships has already begun. For example, the Irish government is in the forefront of efforts to coordinate the views and voices of like-minded members. On the trade question, Ireland is alongside Nordic and Baltic states in the informal “Hanseatic League Mark Two”. On digital matters allies and friends are also in contact.
But there is another, strategic, level for us to consider. When the EU talks security, eyes normally turn east or south. For us, bordering the Atlantic Ocean security questions may sometimes seem remote.
But is this a moment for us to review our thinking on these wider, strategic questions? Despite our secure position in the west, we have come under a security threat – from Brexit.
A threat that An Taoiseach and the government are resisting by pressing, pressing, pressing until a soft border between us and the north is guaranteed. They have mobilised themselves to carry the case to Brussels and have done so with such clarity the Union, the other twenty-six members, stand with us shoulder to shoulder, never wavering.
We have felt the strength and benefit of EU solidarity over the past couple of years. Imagine what it means to our fellow members in the Baltic region, for example, who border Russia and have large Russian-speaking populations.
Imagine what it means to those member countries that are in the front line in dealing with immigration from the Middle East and the Mediterranean.
As part of the EU we all share the Union’s destiny. We, who have felt, and are still feeling, the benefits of its solidarity should be ready to ask how we may better contribute to the solidarity offered to others.
We value our neutral status but should not stand aloof because of it. We should also want to play our full part in the Union’s security.
* * *
Brexit can only be declared over when the future relationship between the EU and UK is known. This is perhaps most urgent in relation to the Irish border.
The UK has twice said it will be a soft border.
And Prime Minister May said in her Mansion House speech that the UK wasn’t about to walk away and leave it to us and the EU to deal with the question.
This is positive. But we are still stuck fast in the UK’s self-imposed contradiction between its reassurance of a soft border and its hardline demands, its red lines, which have led the EU to offer a free-trade agreement.
The UK wants to keep its red lines, understands that a free trade agreement means a hard border, and is trying to escape by “inventing” a new type of border.
It says a soft border can be assured – even in a free trade agreement – through new customs practices and modern technology, what I have called a cyber border.
The EU has looked at the UK’s ideas; is not convinced that they can give us the border security we need, within the Brexit timescale; and has sent the UK back to the drawing board. Meanwhile it insists on the back-stop of a customs union for the whole island.
An Taoiseach and the government, supported by the EU, have made it clear that they are not fudgers. The UK has to face up to the fact that decision time is here. The EU must be satisfied the UK’s invention will work or it is the back-stop. The deadline is set for June. No decision, no Withdrawal Treaty; no Withdrawal Treaty, no transition.
* * *
As I say, the government has the border issue under close surveillance. Let us consider for a moment the final piece of Brexit business – the future arrangement between the EU and the UK. Here the target is to agree the broad lines by the autumn and fill in the detail ready for the agreement to be in force by January 2021.
In her Mansion House speech in March, Prime Minister May revealed that the UK wants to retain many of the advantages it gains from EU membership. She has given us a long list of what the UK wants to keep. A very long list.
On the other hand, she maintains her red lines.
Future discussions will show us how badly the UK wants what the Prime Minister has asked for. And by future discussions, I don’t just mean Brussels-London, I mean also the London-London discussions. Indeed, I would say that London-London is the more critical.
Now that its battle is won, now that the UK is within a year of leaving the EU and becoming a third country instead of a member, can London-London climb down from the barricades and evaluate future arrangements with the EU to find a solution which will be in the best interests of UK people, as workers and as consumers?
In my view, a landing zone involving some form of customs arrangement and softening of the red lines must be in the best interest of all concerned.
Or do the Brexiteers want to carry on the civil war until there’s not a building left standing on the other side? Is this the sort of victory they seek? If so, they don’t only endanger the UK’s economy but its society also.
The recent statement by Jacob Rees-Mogg in relation to Irish beef is a good example of a comment that is both unhelpful and irresponsible. But of course this is his stock in trade.
His comments highlight that the rift between the Brexiteers and the Remainers risks going on and on.
Instead, both sides should compare and honestly weigh the costs and benefits of a free trade agreement versus a customs union; this is a moment for balanced judgement, not costly immoderate ideology. Now that Brexit is irreversible, such a review would be the statesmanlike option.
Let’s be frank, the importance of this for Ireland is that the more the red lines are softened, the less disturbance there will be to our UK trade and the easier it will be to achieve a soft border without relying on technical and bureaucratic wizardry.
So Ireland certainly has its own preference for the outcome of these talks between London and London. But it is not in either Ireland’s or the EU's power to realise it. Both are on the sidelines.
The UK has asked, in effect, for a free-trade agreement. Yes, it wants all sorts of additions, but its basic demand is a free trade agreement. And this is what the EU is offering.
* * *
Wrapped into the argument between a free trade agreement and a customs union is the ambition of Global Britain.
In her Mansion House speech, Prime Minister May listed the UK’s freedom to negotiate its own trade deals as an advantage of Brexit.
But, for this freedom to improve the lives of UK people, the UK would need to offset its losses in trade with the EU – which are certain to take place as businesses cut British companies out of their supply chains – and gain additional benefits.
This is the ambition of Global Britain. Is it realistic?
I know that the freedom to seek and negotiate trade deals seems intimately connected to sovereignty. But the UK needs to look at this issue with cold-eyed realism. Its overall objective is to achieve a better future for UK citizens. This cannot be achieved on a wing and a prayer.
What are the factors that make me so certain that Global Britain is not the answer?
First, outside the EU, the UK will see its standing and importance reduced. Global Britain will feel that pain. As I mentioned earlier, size matters in trade.
Second, despite the sometimes effusive language, a trade deal with the US will be very difficult to negotiate. "America First" will be ringing in the ears of the US negotiators.
The US will certainly seek market access in areas that will bring the UK in direct conflict with European standards, for example on genetically-modified crops, hormone beef, chlorine-washed chicken, and so on.
Third, the UK wants to turn again to the Commonwealth. Yes, the Commonwealth has a common language and similar legal systems but it is not a cohesive bloc. There is no single negotiating partner, nor is it geographically compact. And Commonwealth countries have their own demands – India is determined to keep its high tariffs on Scotch whisky, for example, and would probably want the UK to ease restrictions on work visas: something that would not be acceptable to Brexiteers.
Global Britain is stepping out of the huge network of global trade deals that the EU has negotiated and into a difficult world. It is legitimate, therefore, to doubt whether it can achieve more trade for the UK than at present, at least on any realistic time scale. On optimistic assumptions, even UK civil servants say it can’t.
They forecast that Brexit will cause a 2,6% hit to GDP. But if some of their assumptions on trade are made more realistic, the potential losses become greater.
And doubts about betting the house on Global Britain only increase when you count the loss of benefits on the Prime Minister’s negotiating list – benefits that don’ accompany a free trade agreement.
The facts say: “Reconsider.”
* * *
In conclusion, Senators, the Brexit storm has yet to pass, although we have, in the last couple of months, made good progress towards safeguarding our future.
The EU has stood with Ireland, defended Ireland and, in doing so, has demonstrated its value. We are not out of the woods by any means. But we can draw confidence from everything that has happened so far.
I firmly believe we have a European Union that is proud of us as members and of which we can be proud. I want us to build further on this foundation. Go raibh míle maith agaibh.