Brexit vote a ‘risky bet’: US ex-treasury secretaries

Bloomberg

Leaving the European Union would be a “risky bet” for the U.K. and the country should not “turn inward,” according to eight former U.S. Treasury secretaries going back to the era of President Richard Nixon.
The intervention in a letter to the Times newspaper in London published on Wednesday came two days before U.S. President Barack Obama is set to add his voice to those warning Britons of the danger of backing a so-called Brexit. PM David Cameron is hoping that the swell of voices from overseas will sway undecided voters before the June 23 referendum. “It would be unfortunate for the British economy, unfortunate for Europe, unfortunate for the U.S., and unfortunate for the world,” Lawrence Summers, one of the signatories to the letter.
“It would do damage to London as a financial center, it would do damage to Britain as a gateway to Europe, it would remove the very positive influence that Britain has within European debates that strengthen the European economy. It would be a step toward a more closed, more protectionist, less effective and less prosperous global economy.”
The first week of formal campaigning has seen the “Remain” campaign, led by Cameron, turning its full fire on those arguing for a “Leave” vote. As well as seizing on global voices such as the IMF, it deployed a U.K. Treasury analysis that suggested a Brexit would cause decades of harm to the economy.

‘Wouldn’t Dream’
Vote Leave, the official campaign for a British withdrawal from the 28-nation bloc, responded with anger to the intervention and said the U.S. would not be willing to give up sovereignty in the way Britain has to the EU.
“These U.S. politicians wouldn’t dream of agreeing to give NAFTA £350 million a week, or handing power over to Mexican judges over which criminals they can deport or opening up the US border to Mexican migrants,” Vote Leave CEO Matthew Elliott said.
“They would have been laughed out the building if they suggested it. So why do they think that we should do the same with the EU?”
The latest published poll, conducted April 12-14 by TNS, found 38 percent of respondents backing staying in the EU, with 34% opposed and 28% undecided.

‘Global Primacy’
The Treasury secretaries’ letter, which was highlighted on Twitter by Cameron and Chancellor of the Exchequer George Osborne, said that “while Britain will remain an attractive center for finance even if Britain exits, it should not take for granted its global primacy when it is no longer the gateway to Europe.”
A Brexit vote would “likely disrupt and reduce trade flows at least for a while, curtailing the scale and efficiency benefits from economic cooperation and integration.”
“Over time, Britain would no doubt be able to re-establish trade ties through negotiation of new trade agreements,” they wrote.
“But as our own experience in the United States with trade negotiations shows, it is a difficult environment to negotiate and approve agreements and the risk of accidents is real.”
Former U.K. Defence Secretary Liam Fox rejected the argument of the Americans, telling the BBC they had “failed to take into account the decline and failure of the European economy.”
As well as Summers, the other signatories were George P. Schultz, W. Michael Blumenthal, Robert Rubin, Paul O’Neill, John Snow, Hank Paulson and Timothy Geithner.