Bill Carmichael: It's time that we called Juncker's Brexit bluff

In a speech to the Belgian parliament, Jean-Claude Juncker said: “The British people have to know, they know already, that it will not be at a discount or at zero cost… So the bill will be, to put it a bit crudely, very hefty.”

According to some estimates the EU is likely to demand the UK pays up to £50bn as the price for our independence. Cheap at twice the price if you ask me.

But it is worth trying to analyse what Juncker is up to here. Does he really believe that trying to bully us will make us change our minds? I don’t think so.

Juncker’s sabre rattling clearly demonstrates how weak a hand he has got in the upcoming negotiations.

What is he going to do if the UK simply refuses to pay this “Brexit Bill”? Throw us out of the EU? Erm… yes please!

The key thing to understand here is that the fear giving them sleepless nights in Brussels isn’t that Brexit will be a terrible disaster. No, they will be delighted if that happens.

The real worry is that Brexit will be a terrific success. If the UK is able to establish friendly relations and lucrative trade deals, both with countries in the EU and around the globe, then the other member states will start to question the value of tying themselves to giant job-destroying bureaucracy.

And if that happens the whole thing could unravel very quickly. This explains Juncker’s intervention. His comments are not aimed at the UK, but at the remaining 27 EU members. He is in effect saying: “Don’t even think about leaving or we’ll hit you very hard.”

What kind of a club is it that has to use threats to stop members from leaving? A very bad one, that’s what.

So the EU is in a terrible bind. If they are too hard on the UK in upcoming trade negotiations, they will destroy jobs and growth in their own countries. But if they are too soft it could encourage other countries to consider leaving.

In truth these tantrums coming out of Brussels don’t amount to very much – because the real power lies in Germany.

Germany has always dominated the EU, but now with the UK – the last serious counterweight to German power – leaving, that dominance will become absolute. And what you can be absolutely sure of is what Germany wants, Germany will get.

For example Stephan Mayer, a member of the German parliament and a key ally of Chancellor Angela Merkel, was swift to criticise Juncker’s remarks.

“I’m not so happy with this aggressive line,” he told the BBC. “I fear in a certain way that this harsh pressure, which is put by the European Commission on the UK, is not in Germany’s interests.”

Well, if it isn’t in Germany’s interests, it isn’t going to happen.

It is not hard to discover why. Figures from the Office of National Statistics released this week reveal we run a massive £61bn trade deficit with the EU – in other words we buy far more from them than they buy from us.

The trade deficit with Germany alone is almost £22bn, with Spain over £10bn and with Belgium over £8bn. If all trade between the UK and the EU stopped tomorrow, it would hurt them far more than it would hurt us.

Do you honestly think that VW, BMW and Mercedes are going to wave goodbye to their biggest European export market just because a few unaccountable bureaucrats in Brussels are having an adolescent strop? Mark my words – it simply isn’t going to happen.

Despite all the gloomy forecasts from Project Fear, the UK continues its remarkable economic success story with robust growth and low unemployment.

In contrast the EU suffers anaemic growth, high unemployment and frightening levels of debt. The moribund EU needs a trade war with its highly successful neighbour like it needs a hole in the head.

All you really need to know is this – if a trade deal between the EU and the UK suits both Britain and Germany, it will go ahead. And there is little Mr Juncker can do about it.