Monday, June 20, 2016

An exhortation. 20.6.16

I leave shortly for my latest camino. And there can be only one post today – an exhortation to British readers. Or at least to those who can vote this week in the imminent Brexit referendum . . .

So . . . 

As an expatriate Brit, I have a large stake in the outcome of this. But I don't have a vote. Just as I don't have a vote here in Spain, where I pay my taxes. Surely all wrong.

But anyway, the big day is almost upon us/you and I wanted to post this last column as it represents my Big Picture, Top-down view - to which the (ludicrous) numbers - and immigration - are irrelevant.

An exciting world is waiting outside the EU: Matt Ridley, 'The Times'.

I was just too young to vote in the 1975 referendum. I would have voted “Yes” to the European Community and I think I would have been right to do so. It had contributed to European peace by blurring French and German economic sovereignty. It was a free trade area in a world of high tariff barriers, albeit within a protectionist wall that excluded other countries and continents. It helped to halt Britain’s disastrous obsession with central planning.

Two decades later, the European project stopped being about economic growth (to this day it still has no trade deals with America, China, Japan, Brazil, India, Canada, Australia and Indonesia) and embarked on the drive for monetary and political union, embodied in the treaties of Maastricht, Amsterdam and Lisbon.

The result has been horrible. Unlike every other continent, Europe stagnated for the best part of a decade after the crash of 2008. Monetary union in the eurozone without fiscal union gave Germany an undervalued exchange rate and southern European countries an overvalued one, and so produced rocketing levels of unemployment.

Far from promoting peace, the European Union now increasingly foments fury in many of its member peoples. War within its borders, though still unlikely, is no longer quite so inconceivable as we had hoped. Its ambition of trying to make a country out of a continent without preceding linguistic, cultural or economic equality, without even the ability to share wealth from the richer to the poorer regions, will be a painful one. In a world where trade is increasingly free, where global economic and regulatory co-operation is miles better than it was in the 1970s, I think this regional unification project is a red herring at best and fool’s errand at worst.

America made a country out of a continent by beginning with linguistic and cultural unity and by building a hyper-democratic structure in which the executive and legislative branches were both subject to frequent election.

The federal government assumed the debts of the states (in exchange for moving the capital south), so ensuring automatic fiscal transfer between the richer and the poorer parts of the country.
Yet it also built in a crucial bulwark against over-centralisation, to allow local experimentation and diversity by giving huge power to an elected senate representing the states. Even so, it took a civil war to forge a united nation.

Germany became united through Bismarck bullying a lot of undemocratic regimes that already shared a common language and culture into a customs union, which then became a state under a centralised and militaristic regime with the barest veneer of democracy.

Yet it took three wars and a revolution (in 1989) before Germany’s borders were settled and its regime became democratic. Nation-making is a dangerous business: France and Britain had done it centuries before with just as much pain.

Be in no doubt that if we vote to remain on Thursday, turning the continent into a country is the path we are on. The Five Presidents’ Report of last year is admirably candid in this respect. David Cameron’s renegotiation of Britain’s membership terms made a crucial concession to get French agreement to some of his demands: that in future the EU institutions are at the beck and call of the eurozone in its quest for further unification.

True, Britain and Denmark may remain outside the euro for now (the other non-euro countries are committed to joining it), but future European summits will be all about making the eurozone work.
If the continent is not to be crucified on the cross of a currency, then it must become a country. It must have a single government that automatically transfers tax revenue from the productive to the less productive parts of the country.

The EU has created an ancien régime ruled by unelected commissioners with the sole power to initiate legislation, with a court able to overrule the elected parliaments of member states.

A regime whose corridors of power are swarming with lobbyists for big business, banks and pressure groups, all intent on getting bureaucrats to stifle innovation to protect their monopolies — and to harmonise the hell out of regional diversity.

This flies in the face of all that we have striven for and shed blood for over centuries, especially in Britain: that laws cannot be passed and taxes cannot be raised except with the consent of the people through their elected representatives. I say again: is this worth it? What is so fearful about the world today that we feel it necessary to be absorbed into such a risky project?

Now that the World Trade Organisation has brought tariffs to an all-time low, the decline of violence has brought deaths in warfare to low levels and the internet and budget airlines and container shipping mean that geographical proximity has never mattered less, we can all feel citizens of the world.

Islands that freely trade with the world, enthusiastically elect their own governments and willingly join alliances are thriving as never before: Japan, New Zealand, Australia, Hong Kong, Singapore, Mauritius (one of Africa’s countries with the highest GDP per capita). They see no need to be enmeshed in the top-down unification of their nearest continents.

In the 1840s at a time when war was common and slavery and autocracy were everywhere, Britain felt confident enough to try an ambitious bottom-up experiment: unilateral free trade. Richard Cobden finally persuaded a Tory prime minister to repeal the corn laws (170 years ago this Saturday) and he would shortly persuade a Liberal one to dismantle tariffs of all kinds.

France followed suit and the world began a race to the top, embarking on a period of unprecedented prosperity.

It was Bismarck’s punitive reparations demands in the wake of the Franco-Prussian war in the 1870s, leading to the “iron and rye” tariffs to protect German industry from the effects of an overvalued exchange rate, that began the 60-year race back to the bottom of protectionism, contributing eventually to the fatal calculation of 20th-century dictators that conquest could trump trade.

The best way to unite the nation is for the British people to turn out on Thursday in large numbers and express the wisdom of their crowd and for us all to embrace that decision. I hope we choose the world, not just a continent.

Given that I've been against the Project since reading the revelatory book, The Great Deception, or even before – it's hardly surprising that I favour an exit. I've always argued that it was a wonderful dream - with the emphasis on 'dream' - as it ignored cultural, lingusitic and economic realities. Not to mention centuries-old enmities. 

And that was before the amazingly self-congratulatory introduction of the (havoc-wreaking) euro.

So, if this article tips just one of you into the Brexit camp, I shall be a very happy man.

British voters . . . Ignore the petty, numbers-based Stay argument and help to avoid mortgaging the future of the UK to a superstate ambition of another era which just happens to benefit most its self-interested drivers - technocrats, bureaucrats, sitting politicians and Germany - and is, anyway, doomed to collapse within 10 to 20 years.

Demonstrate again the wisdom which has been shown so many times in our 3-400 years of democracy! Be a visionary, not a bloody small-minded accountant! A book-keeper, even.

But, if not, I will cease to be British.

Postscript: If the vote really is to quit and I need to protect my EU status, I'm lucky enough to be able to choose either Spanish or Irish nationality. And the latter allows me to keep my British passport. So does the Spanish option, in practice, but this would be illegal under Spanish law. As if this would worry anybody Spanish!


Sierra said...

So, summing up - UK - great place, with a wonderful future (as long as I don't have to live there) - the classic expat.

Tom said...

Your exhortation to "ignore the numbers" is astonishingly narrow minded. I'm actually shocked.

Colin Davies said...

Well, I'm shocked at these 2 comments . . .

1. I'm still capable of thinkng about the long term future of the country.

2. The numbers have to be ignored because all of them are inventions to serve a purpose, on both sides. They are no critical asssumptions given and no sensititivy analyis done. In business terms, useless. And the error factor is vast. There are much bigger issues. But if you have good sound forecasts, Tom, let me have them, and the assumptions behind them. I'll be shocked if you can.

3. I still have a daughter in the Uk and I might still move back.

4. I don't have any financial interest. Other than the minor element of my entire pension, which will be worth a lot less if Brext results in a fall in the pound. If I had a vote, I'd be economicially worse off. It's the Costa Brava Brits who are the classic expats. "I don't care about the UK. I live in Spain, though i don't integrate. I'm only interested in my immediate financial future·.

Your comment is way off beam, Sierra. But I accept your apolgy in advance . . .

Tom said...

Actually, Colin I think you've got it completely the wrong way around. When dealing with a question like this, where there is a choice between the status quo and a new situation, it is categorically those advocating for a change who bear the burden of proof. The Brexit campaign has had one number which it has repeated over and over again (the 350mGBP/week number), which has been thoroughly discredited. All of the available numbers favour remaining in the Union. And just about all the experts agree. And so I suspect that you're only calling on voters to ignore the numbers because you've taken a look at your own critical assumptions and realised that you don't have a leg to stand on.

One of my main problems with the Brexit case is that its promoters have been so disingenuous when it comes to the risks involved. I'd much rather that they - and you - admitted "We don't know what's going to happen, and we don't care". Which is clearly the truth.

Finally, what are these 'much bigger issues'?

(Oh, and I think you meant Costa del Sol. Far more expats than on the Costa Brava).

Colin Davies said...

So, you think we should start with the quantitative, however questionable the number on both sides might be, and then move on to the qualitative, though giving much less weight to the latter?

The burden of proof is on both parties on such a crucial issue. And the numbers they produce - as well as the arguments - should be as honest and as reliable as they can come up with. Even if accuracy is virtually impossiblle. We're talking economists here!

To me, it's irrevlevant what stupid numbers have been quoted by both sides. Theay are not the real issue. And neither is immigration. It's irrelevant also how bad UKIP have been with their ads. This is not an issue on which to take sides on the basis of morality, for God's sake.

Your suggestion that Brexiteers should all admit that they don't know and don't care is half right, as it is with the other side. They should all admit that they don't know. It IS a leap in the dark and if you don't support that, that's your call. But to suggest that those who don't agree with you don't care is almost outrageous.

As for other issues - I can only believe you didn't read the article, you haven't been following the debate and considering both sides and/or that you reject them as irrelevant because of the numbers and the fear/risk of the unknown. Otherwise I really can't understand your request. And I don't believe me setting them out would change your mind one iota. This post was clearly not for you.

So, as I am now officially on caminio, I trust you'll forgive me if I don't comply.

Maria said...

I don't have an opinion one way or the other. If the U.K. leaves I know both the U.K. and the E.U. will go into the economic doldrums as an immediate reaction. I also believe eventually they will recover. But if the U.K. goes out, I think a few more countries will follow, and the destruction of the Union be inevitable. As it is now, if the U.K. doesn't leave, the Union will stand for a few more years before its issues scream to be solved, and the Euro will hit rock bottom. Which scenario is better in the long run? I don't know, I'm not versed in economics. But a large change is needed, no doubt about that.

(I also have a U.S. passport at the same time as my DNI, and I've used it. There'll be no problem with your having a different passport from Spanish.)

Colin Davies said...

Well put Maria. A very understandable position, which I believe is shared by many.

As ever, it's a choice of evils. I see the EU as an example of the road to hell being paved with good intentions. And I do not believe it stands a snowball's chance of surviving unless a Brexit (or a near miss) forces those with power to insititute the changes they wouldn't otherwise have implemented. Especially if the vote is close. How anyone believes Britain can stay in and reform it from the inside is quite beyond me.

Eamon said...

Since the beginning of the move by Britain to leave the European Union nothing has really been done to solve the problems that Britain finds by being a member. All that has come out of Europe are threats of no more trading with Britain and Britain won't survive outside of the EU. Well the EU can sell their goods that Britain can't buy to someone else. It won't be the first time that the British have had a hard life and it probably won't be the last. How did Britain ever survive before the European Union beats me. If Britain leaves the European Union the Europeans can have a big party to celebrate getting rid of a headache. It will be great for the Germans because they won't have to worry about having to place their beach towel on the sun lounges around the pool before sunrise.

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