UK prime minister David Cameron has promised to renegotiate terms of its membership in the EU and put the measure to a popular referendum.

In response, Business leaders warn UK’s David Cameron that leaving the EU would be bad for economy.

Top business executives have warned U.K. Prime Minister David Cameron that he could damage Britain’s economy if he seeks to renegotiate the terms of its membership in the 27-country European Union.

In a letter published in the Financial Times on Wednesday, Virgin Group’s Richard Branson, London Stock Exchange head Chris Gibson-Smith and eight other business leaders challenged Cameron’s plan to renegotiate the U.K.’s EU membership terms and put the matter to a referendum.

However, popular distrust of the EU has grown in Britain — one of the 10 countries in the region that doesn’t use the euro. The British public shows no interest in the EU’s plans to move closer together. Most can’t even seem to stomach the current level of power of the EU, which many Britons see as meddlesome and inefficient.

Though the business leaders urged EU reform in their letter, they argued “we must be very careful not to call for a wholesale renegotiation of our EU membership, which would almost certainly be rejected.”

“To call for such a move in these circumstances would be to put our membership of the EU at risk and create damaging uncertainty for British business, which are the last things the prime minister would want to do,” they said.

But while Cameron wants Britain to remain in the EU and to retain influence in the body, he is also resisting a push by many member states, like France and Germany, to grant central authorities in Brussels greater powers over financial and legal affairs for the whole of the EU.

In the long run, many EU countries want to turn the bloc into a United States of Europe, an idea British politicians, particularly among Cameron’s Conservatives, abhor.

We Want Our Cake And Eat It Too

Note that it is not just UK businesses that want their cake and eat it too. So does Cameron.

The irony is that everyone is tired of the nonsensical nannycrat rules of the EU, and those rules will only get worse as time goes on.

For example, the nannycrats in Brussels are hell-bent on financial transaction taxes, high VATs, and onerous corporate income taxes. The bureaucrats also have gone along with absurd crop subsidies demanded by France. The result is everyone in Europe overpays for food (and nearly everything else) on account of tariffs that have not saved a single job. 

For now, the EU has backed down on a ridiculous airline carbon tax scheme, but rest assured the subject will come up again. Indeed, all the nannycrats did in November was suspend the proposal for a year, hoping for less opposition next time.

One Million Tiny Miseries

Bureaucrats never give up on stupid ideas, they just set them aside for a while. Proof is in the pudding. In the EU, inane rules, regulations, and fees are everywhere you look.

In case you think I am exaggerating, Pater Tenebrarum has an excellent writeup in his post One Million Tiny Miseries Inflicted by Government Policy

Hotel California Setup

Cameron sees some of those things and wants to renegotiate special rules for the UK. In effect, he wants to have his cake and eat it too, just like the business leaders. His hope is to keep the nannyrules he likes, and toss out a plethora of rules he doesn’t like.

The problem with his approach is this is a Hotel California setup. As with the Euro, you can check in anytime you like, but it is damn hard to leave.

If Cameron commits (or the referendum passes), sometime down the road, after he is gone as Prime Minister (which could be rather soon), some other prime minister is likely to agree to god-knows-what, and without a referendum giving UK citizens any say in the matter.

Note that had it not been for that absurd transaction tax idea last December, Cameron may have signed on the dotted line already.

US Voices Concern

The Telegraph reports US publicly voices concerns over Britain leaving EU

Philip Gordon, the US assistant secretary responsible for European affairs, said that Britain’s membership of the EU was “in the American interest”.

His remarks came as David Cameron prepares to deliver a speech on Europe later this month. The Prime Minister is expected to promise to renegotiate Britain’s membership and then put the new terms to a referendum. Many Conservatives, including some Cabinet ministers, believe that a ‘No’ vote would mean Britain leaving the EU, although Mr Cameron says he opposes an exit.

One Last Chance to Get this Right

The UK has one last chance to get this right. The way to get this right is simple: Ignore pleas from the US, put the matter to a vote (including an option to leave the EU as opposed to renegotiate terms), openly campaign to exit, then politely tell the EU to go to hell when the result comes in.

Simply put, it is preposterous to expect one nation out of 27 to have significant leverage over a group of dedicated nannycrats, all wanting some inane rule, regulation, or tax.

In the meantime, expect nannycrat proponents to pound the airwaves with threats of Armageddon sometime before the vote.

It will be interesting to see if common sense secures a victory over the nannycrats, the socialists, and the half-baked conservatives expecting to have their cake and eat it too. Don’t count on it.

Mike “Mish” Shedlock