So for the next year at least, the UK will appear a clear success story while the eurozone remains a mixed one. The Government, however, should refrain from swaggering, and not only because we had too much of that under the previous regime.
Whatever happens, we are likely to grow more swiftly than the eurozone. But what matters for Europe is whether the present reform agenda is sustained.
What matters for the UK is whether our present outpacing of Europe is sustainable. We still have a lot of problems (including a larger fiscal deficit than any core European country) and we need several years of solid growth to fix them.
That leads into the great medium-term debate about EU membership, that awkward word Brexit. If there is a wide spectrum of views about David Cameron’s political tactics, there is an even wider one about the economic consequences of the UK leaving the EU.
For example the new prime minister of Finland, Alexander Stubb, said: “It’s very important that the programme Juncker puts forward is very market-oriented… In the UK, some people need very seriously to wake up and smell the coffee; the European Union is a very good thing for the United Kingdom.”
On the other hand, the think-tank Civitas has just produced a report arguing that the EU single market has brought no lasting benefit to foreign investment in Britain. Non-EU European countries, notably Norway and Switzerland, have fared better.
This debate will go on and on. So what on earth should we think about it? Here is a suggestion: it is quite clear that the UK will have a semi-detached relationship with the EU. We are not going to join the euro and we will continue to try to negotiate various opt-outs of EU policy.
It is also clear that the UK and European economies will remain closely integrated for the foreseeable future. So the question is this: would it be better to be just in, or just out?
The “just in” argument is that this would be administratively much easier. There will be continuing tussles, as we see now, but we have strong allies within Europe and having a dissenting voice at the table will not be unwelcome.
Our bargaining position is very strong as we are still just the eurozone’s largest export market. But if we remain in, we have to accept that there will be continuing arguments, some of which will be rancorous, and the calls for Brexit would continue.
The “just out” argument is that this would end what is and will continue to be a running sore. The exit negotiation would be difficult and there would be some resentment.
But the export market card would be our ace of trumps. Once the exit negotiation was over, and we rejoined an enlarged European Free Trade Association, along with Norway and Switzerland (and Iceland and Liechtenstein), subsequent relations with the EU would be calmer and cleaner.
This surely is the sensible debate to have and you can make a decent argument either way.
My own instinct is that the longer we can delay making a decision the better as much will depend on how the EU evolves and our own economy develops. But “events, dear boy, events”, as Harold Macmillan is reputed to have said, may take over.
