Prime Minister David Cameron is to give a speech on Britain's membership in the European Union on January 18. In his WSJ column, Nixon lays out what he thinks Cameron should say.
Fortunately the debate over the UK's membership in the European Union has shifted decisively over the past few weeks. The business and financial community has finally shown the sort of leadership it always urges on me by publicly making the economic case for participation[1]; and our closest allies have been helpfully pointing out the strategic consequences of withdrawal.
All this makes it much easier for me to say what I now realise I must say. Let me be blunt: there is no way I'm going to lead the UK out of the EU or do anything that might put our membership in doubt. That includes reckless promises of renegotiations and referendums.
Those urging me to pull out of the EU—or to threaten to do so in a playground game of bluff—maybe don't realise what a dire state the UK is in.
We're one of the most indebted countries in the world when you combine public- and private-sector debt. Although my government says it's taking tough decisions, we're running the second-biggest deficit as a proportion of gross domestic product in the EU.
Despite a substantial devaluation and money-printing on an industrial scale, our economy has actually been underperforming the eurozone and may now be heading for a triple-dip recession. Unlike Greece, Spain and Portugal, our current-account deficit is widening, not narrowing.
None of our difficulties stems from our EU membership, but quitting would certainly make the situation worse. Do you really think I'm going to put our fragile prospects for recovery at risk by threatening to withdraw in defiance of the pleas of not only homegrown exporters but of all our inward investors?
Besides, this is exactly the wrong time for the UK to quit an institution it did so much to shape. I'm proud of Britain's role in driving forward the single market and the EU's eastward expansion. Sure, there's plenty that needs to change: Protectionism remains rife and the EU went down a blind alley with its social agenda, which piled new costs on business just when it needed greater flexibility.
But Britain can play a vital role in correcting these mistakes. If the eurozone is to survive and prosper, as I hope and believe it will, Europe needs to seize every opportunity to boost its productivity and competitiveness. That means reducing the burden of regulation and deepening the single market, extending it to areas such as energy, transport, services and the digital economy. This will bring huge opportunities for UK companies. Europe is ripe for a Thatcher moment, and as Margaret Thatcher's political heir, I fully intend to help lead it.
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See also Letter in the Financial Times - Britain needs to lead in a strong, reformed EU
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