‘Dear True Sinews, what are your thoughts on Brexit? Roger Bootle wrote a piece in the Telegraph yesterday suggesting that just because everyone is saying one thing, it doesn’t necessarily follow they are right Currently, I sit firmly on the fence getting splinters! Neither side is convincing me either way.’
So wrote a friend the other day. What follows is my answer to his question.
Funnily enough, my first response to the letter to the Times, that highly-orchestrated, Orwellian protestation of orthodoxy, was to tweet about the infamous 364 economists who wrote decrying Howe’s 1981 budget under Thatcher. Ditto the IMF’s woeful track record or the Queen’s famous ‘How did no-one see it coming?’ question in 2008/9.
Consensus is never a determinant of truth and even, the cynic might say, is often proof of the opposite! Humanity has not moved from grubbing a living rooting for mammoth carrion to where it is today by being over respectful of consensus. In fact, the very nature of entrepreneurialism is to challenge consensus while mainstream economists are still denying the possibility that anyone could possibly have left a £10 note lying on the pavement!
The critical thing is not to get bound up in a further exercise of that stultifying doctrine of paralysis known as the ‘precautionary principle’ so beloved of the Khmer Vert eco-(in)activists. If we had never acted in any different fashion until we were absolutely certain of the outcome, we’d still be swinging from branches in the primaeval forest canopy.
Yes, there are risks – some calculable, many not – but there are also opportunities aplenty. That is why it is so shrewdly disingenuous of Project Fear to play up all the things that might go wrong and to try to paint the Leave camp’s case as insubstantial simply because the latter are being honest enough not to offer an entirely bogus prospectus of what they will do, once they’re out.
For the record, I don’t see Brexit as a panacea, but merely the chance to manage one’s own affairs and to conduct one’s own debates over what should or should not be done by the state in one’s name. As in all things, I hew to the principle that politics should be as parochial as possible, that we should be able to grab a delinquent politician by his lapels at any moment and set him to rights, as well as to clap a diligent one on the back in acclamation when he pops in the local pub for a pint.
Subsidiarity is the thing. Politics should work from the bottom up in widening circles of co-operation and conflict resolution, not diffuse down from on high as if it were Holy Writ. Thus, the smaller the state, the better. And before anyone quibbles about ‘Balkanisation’, being too small to suffer delusions of geopolitical grandeur and too narrowly based to succumb to the temptations of economic autarky, it behoves such statelets to get on well with their neighbours and to concert their efforts with them willingly so as to widen markets and to broaden the scope of mutually-enriching commercial intercourse as far as possible.
Thus, though I think a certain level-headed optimism should inform the case for an exit – over the years, the Brits have managed rather well outside such groupings, after all – the awful warning not to be too starry-eyed about the consequences ought to be what a quasi-independent (but egregiously-subsidised) Scotland is already suffering from the Tartan Taliban under Nicola Maduro Sturgeon!
Conversely, to follow up that same example, it is easier to imagine a small, coherent polity centred on Edinburgh eventually summoning up enough (post socialist-collapse) courage to try out the principles of its own Scottish Enlightenment, to erect statues of Sir John Cowperthwaite on every street corner, and so to become a contented, affluent, vibrant Switzerland of the north, than it is to imagine a soulless EU monolith of 510 million disenfranchised regulation-slaves sparking any kind of latter-day Renaissance.
The Italian city states who last did that were, you will note, small competitive units, largely free to experiment, and not part of some larger and forcibly homogenized amalgam with demonstrably different priorities. One might also mention the case of the United Provinces of the Netherlands, arguably the fons et origo of our modern, bourgeois prosperity
In Britain’s case, the change would inevitably give rise to economic winners and losers and it may easily be imagined to involve some additional, net short-term expense of time and effort as the country moves to adapt. But to pretend, for example, that Europe will maliciously shut out UK exports or discourage the tourists and holiday-homers from visiting in their droves and so risk a devastating retaliation from its biggest source of external income is worse than a joke. (A rational, post-mercantilist economist would note, in any case, that imports are what we benefit from in trade, not exports, just as, in our personal lives, the purpose of ‘exporting’ our labour is to acquire the goods which we choose to ‘import’ from others in their turn).
As for the purported threat to jobs in the City, ask yourself how much has the combination of onerous EU regulation and ECB extremism already cost the industry? Read Peter Praet’s lament this week for the dire straits to which Continental banks have already been reduced. Listen to the howls going up everywhere from the associations of pension and insurance providers in Germany and elsewhere.
Alternatively, ponder the question of how the City grew to be great in the first place, absent the EU’s gentle nurture. When assessing any supposed threat, be sure to take in to account how much expertise, what concentration of skills, what time-honoured synergies in the whole panoply of banking, insurance, trade finance, asset management, and trading resides in Frankfurt or Paris as opposed to the Square Mile and Canary Wharf. Spend some time wondering how do New York and Singapore cope without the EU to watch over them and ‘passport’ their dealings?
Whatever weight you attach to such studied catastrophism, the plus side of the equation is that it would mean that UK policy could be formulated once more from the perspective of addressing solely British needs and not of contributing unwillingly to the integration of an alien empire – an approach which is pretty much a summation of what has informed British history to date.
Of course, it won’t deliver paradise on earth either – given a choice between that too-clever-by-half, serial interventionist, Gordon-Blue Osborne, and Jezza – a kind of intellectually-challenged Michael Foot clone – the prospect is of more bad than good choices immediately arising from the exploration of the newly liberated, political landscape, post-exit. But at least Britons could not only ‘throw the rascals out’ from time to time, but most of those rascals would no longer be motivated by the overriding goal of refashioning an entire Continent, largely irrespective of the cost, in their own image, as is the case with today’s Jacobins-in-office in Brussels.
Furthermore, what the UK Leave campaign has been all too shy in highlighting is just how disenchanted the average European him/herself has become with it all.
Polling shows understandably high levels of discontent (almost half of Italians, two-fifths of French and even a third of Germans said they, too, would wish to leave the EU in a recent survey) – and that’s not to mention all the various regional separatist movements in Spain, France, Belgium, Italy, etc., whose members don’t even want to be part of the existing member state, much less the gestating superstate alternative. In fact, it was recently admitted by a Danish politician that if Britain did vote to leave it might well find that rarest of things, an orderly queue of Europeans, lined up behind it, hoping to do the same!
As Die Welt put it only this week:-
‘More and more of the 510 million EU citizens not only have no interest in Brussels, they flatly reject the European project and would be shot of it tomorrow. They feel the EU has increasingly become a bureaucratic monster that meddles in too many national interests, rather than worrying about the really important things. One that adopts a cucumber curvature regulation, rather than a viable and permanent solution to the refugee crisis. The British will soon have something of which many other Europeans can only dream: a chance to vote on whether their country remains a member of the Union…’
So it’s hardly a Land of Milk and Honey, is it?
Moreover, the fact that people have become rightly fearful for their lives and livelihoods under the triple assaults of economic stagnation, ECB scorched earth policy, and the ‘Decline & Fall‘ re-run of mass immigration is undeniable. The fact that those same people feel that their politicians either do not choose to represent their views or are impotent to do so in the face of whatever diktats emerge from the EU hierarchy is leading to a sadly predictable dissolution of European society.
So-called ‘fringe’ parties are now beginning to make real inroads on the established Tweedledums and Tweedledees to the point these latter are scrabbling about trying to put highly improbable coalitions of not just uneasy, but formerly daggers-drawn, bedfellows together in order to defend their accustomed and long-unchallenged positions at the cosy, Michelin-dining, chauffeur-limo’d centres of power – cynical moves which show up the lack of underlying principle and lay bare the self-serving nature of the relevant politicians all the more starkly and which therefore strengthen the protest parties’ largely, if necessarily, negative case all the more.
Add to that the polarisation which is reducing even the most complex of issues to ones perceived to be so black and white that no democratic compromise is possible.
This means that every adverse decision taken inside the parliament building brings forth a howling mob to throw Molotov cocktails outside it. Look at the farce in France where even the Socialists (or at least one, more pragmatical sub-set of them) have grudgingly recognised that the only way to encourage more hiring is to give back to potential employers some small, extra degree of control over their private relations with their workers. Far from being welcomed, this turnaround has set student hordes prowling the boulevards at night, worried that somebody might make it easier to sack them from a putative future job which one in four of them will never actually get in any case!
Mutti Merkel’s capricious, not to say cavalier, Emperor Valens imitation is also going to haunt the place for generations.
Only Europe could imagine that you could offset the dire implications for an unfunded welfare state of rising demographic dependency ratios by (a) severely reducing the prudent person’s pension income via monetary policy; (b) making it ever harder for pitifully large numbers of young natives to find work; and (c) indiscriminately importing millions of underskilled, culturally-incompatible aliens and then paying them tens of billions of euros to become devil-makes-work-for-idle hands, unintegrated dependents in their own right.
But, to the inner core of European politicians this is dialectical heaven! The greater the chaos, the less legitimate and the more helpless the national governments appear to be, hence the more opportunity to ratchet up the cause of centralisation. Bonaparte would be proud of them.
For a case in point, Schaeuble – whom some Brits seem to imagine is a sceptic of some sort, just because he doesn’t suffer (mainly Latin) fools too gladly – gave an address at Basel University a month or so back in which he said, pretty much verbatim: ‘Yes, the refugee situation represents an enormous crisis but, as you know, we only make progress in Europe by means of crises so I’m hugely optimistic as a result.’
You really don’t want to be part of all THAT just so you don’t have to fill a few new forms in, do you?