SATURDAY ESSAY

EVEN at events where the Champagne flows freely, the mood in the German capital is subdued these days. On Tuesday I attended one of these glamorous Berlin functions, at which our Chancellor Angela Merkel was awarded the American Academy’s Henry Kissinger Prize for her contribution to transatlantic relations.

Merkel was lauded for her ‘steadfast’ leadership, which had provided ‘ thoughtful, decent and long government’.

But all that praise could not disguise the profound sense of apprehension that hung in the air.

In Germany, fears are growing that the ship of Europe is sailing troubled waters. Soon it could be dashed on the rocks.

Why the anxiety? The looming impact of Brexit, as politicians and policy- makers across the continent begin to recognise that Britain’s departure represents a daunting challenge to the European project.

At times it feels like cocktail hour aboard the Titanic, with the iceberg looming on the horizon.

It wasn’t meant to be like this. For years, EU leaders have insisted that Brexit would be a disaster for Britain, leaving your country hopelessly isolated.

According to the relentless propaganda of the pro-EU cause, Europe would forge ahead on the global stage, ever more united, while the UK would slide into insularity and decline. But that narrative is starting to look like a delusion.

Headed by a strong government and sustained by a dynamic economy, it is Britain that can look forward to the future with confidence, while the EU and its member states remain trapped in bureaucratic sclerosis, obsessed with regulation and welfare when much of the rest of the world is embracing commercial freedom.

This week, your Government’s Brexit Bill finally completed its passage through Westminster, despite some last-ditch and futile skirmishing by Remainers in the House of Lords.

AFTER

all the long years of Parliamentary stalemate, Britain’s withdrawal from the EU will become a reality next week. The alarmists of Project Fear predicted that this moment would be the cue for economic meltdown, yet just the opposite is happening. Britain seems ready to prosper.

Only on Thursday, an authoritative study by the Confederation of British Industry reported the biggest surge in confidence on record among manufacturers, with companies planning to rampup investment.

The CBI’s report followed news earlier in the week of yet another fall in unemployment as the British jobs miracle continues.

The jobless rate in the UK is at its lowest since 1974, while employment, at 33 million, is at its highest-ever level.

Particularly striking is the dramatic growth in selfemployment to more than five million, a sure indicator of an enterprising economy.

The welcome jobs news comes against a backdrop of a rising pound, widely available affordable credit, a resurgence in the property market and a significant fall in Government borrowing.

Britain looks like it can manage well without the EU. But can the EU manage without Britain?

Your economy is bigger than the 18 smallest EU countries combined. This means in economic terms that the EU will lose not just one member state — but shrink from 28 members to ten. On a purely fiscal level, the loss of Britain’s contribution will have huge implications for the EU’s budget.

And, on much a deeper level, Europe will also badly feel the loss of the Anglo-Saxon, promarket business model, when so many EU governments are addicted to a quasi-socialist, big- state, heavily interventionist approach.

It is telling that, in this age of online technology, Europe’s most significant achievement has not been to create a new web giant to rival Amazon

or Google, but to use its clout to introduce tougher controls on email traffic through more regulation.

Similarly, it is remarkable that EU member states account for only seven per cent of the world’s population — but 50 per cent of all welfare spending.

The truth is that Brexit — so often sneered at by the federalists — has shone a harsh spotlight on Europe’s deepseated structural problems.

Here in Germany, our economy has long hovered on the brink of recession, with growth at its most anaemic for a decade.

Manufacturing is looking increasingly outdated as exports and capital investments suffer.

Our car industry — the backbone of our economy — now faces perhaps its biggest crisis since Gottlieb Daimler and Karl Benz invented the automobile in the 1880s.

Yet in the face of this darkening picture, Merkel — now in the last full year of her tenure — seems astonishingly complacent and impotent.

At that Champagne reception in Berlin, she boasted of her achievements, then went on to do something most unusual for a Western politician: she quoted the Russian revolutionary Lenin, who referred to the political principle of ‘one step forward, two steps back’.

No one seemed surprised that Merkel uttered the name of this massmurdering communist in front of an august group of U.S. academics.

Meanwhile, the difficulties