journal of european integration history revue d'histoire de l ...

The Hague Conference of 1969 and the United Kingdom’s Accession 119
more expensive food imports on the cost-of-living was more predictable. Some
estimates foresaw it to be between 12 and 15 per cent over the first two to three
years of membership. That something of this order of magnitude would occur was
largely expected by the public and the inflationary impulse which it would give to
the economy was an undisguiseable political problem when inflationary trends
were once again becoming a matter of domestic political concern.
The Common Agricultural Policy thus posed a two-pronged threat. One prong
was the ammunition which its inflationary consequences would give to Labour
Party opponents of entry. The other, which disturbed Harold Wilson and his
ministers more, was its consequences for the balance of payments. From the
moment early in 1966 that serious thought was given to making a second
application for Community membership officials were adamant that it could not
succeed if Britain questioned in any fundamental way the principle of the method
by which the Community’s ‘own resources’ were to be provided, for that would be
to question also the principle of the CAP itself. The question the government had to
answer therefore was not whether it was ready to pay the excessive share of the
Community’s running-costs which would be demanded, but the more realistic one
in the circumstances of whether it could do so. This may seem paradoxical in view
of the elimination of alternative possible international frameworks by ministerial
committees between 1963 and 1966. Persisting with EFTA; enlarging EFTA;
developing the Commonwealth trade preferences into a programme more
specifically aimed at stimulating an improvement in the overall export performance
of British manufacturing; a North American Free Trade Area (which might
eventually embrace EFTA); all these were ruled out as substitutes for EEC
membership or even for persevering with the status quo after de Gaulle’s veto.
But the conclusion that Britain had to try to join had no validity if joining would
make its economic situation still weaker. The decision to apply a second time in
May 1967 for membership, followed logically by the decision not to withdraw that
application in the event of its rejection, has to be seen in the context that the
strength, thought to be declining, of the economy could only be restored by
increases in sales and an improvement in total factor productivity by the
manufacturing sector and that this in turn could only be achieved by an increase in
exports from that sector. The ultimate purpose was to reverse what the governments
of the 1960s saw as a decline in British political influence in Europe, largely
attributable to exclusion from the Community, whose consequence would surely be
also a decline in British influence in Washington. But the restoration of British
influence was very closely linked in the collective mind of the Labour Party, which
governed for most of the decade, with restoring the fortunes of the manufacturing
sector. It was from that sector that their main source of political support was drawn.
They had before their eyes the clear evidence of the way in which the common
market was promoting the growth of manufactured exports from all of its
member-states through the mechanism of the European preference system and
believed that it would exercise a similarly dynamic effect on British industries. It
was, already, the most rapidly growing market for them.