Wednesday, June 15, 2016

Bye bye UK

As the date for the UK vote on the country’s pertinence to the EU approaches it is becoming more and more clear that, as much as most of the political establishment and the upper classes would like the ”remain” option to prevail, the “leave” will win the day. Which kinda sucks, as I’m a great fan of British beer, and fear that its price in my corner of the world will go up after they are penalized with heavy import tariffs for their defiance. Thankfully, many of the best crafts lately come from Scotland, which I hope will secede from Great Britain as soon as the vote counting finishes, and which would be quickly readmitted back in. Now seriously, I am going to devote this post to analyze why the Brits will likely vote to leave against what the most educated amongst them tell the masses is their best economic interest, to what extent that is true, and what I would vote if I were them (not that anybody should care, but I can envision more of these referenda in our collective future, as the European project bleeds legitimacy and attractiveness with every member that decides to follow the British example –and make no mistakes, after the Brits there will be more votes like this).

Let’s start by recapping who is for leaving (“Brexit”) and who for staying, what arguments have they made publicly and what arguments really animate them (as we will see the two can be substantially different). The Brexit party is animated by a core of unrepentant Eurosceptics that for decades have brooded within the conservative party, claiming that “Europe” is taken over from its very inception by socialists and welfarists that have produced a monstrous bureaucracy with no real accountability to any single country’s electorate, that thus limit economic growth by the imposition of needless regulation, the “crowding out” of private initiative and the encouragement between its member states of a policy of high taxes and excessive safety nets. Getting out, for them, is all about regaining “control” over the UK finances, their traditions (including a tradition of laissez faire in the economic realms they see threatened by the deluge of norms and laws originated in Brussels) and their frontiers (being free to decide who they admit and allow to settle). The last point is the key one, as what polls show is that the core of the movement doesn’t lie within the Tories, but within the less educated (on average, because the intelligentsia in England, as in so many other places, has historically tilted heavily towards the left) Labor voters that seem to be utterly disgusted by what they see as an unconditional surrender of the state towards the foreign imported currents of multiculturalism and an imagined “alien flood”.

So the democratic majority that very likely will get the UK out of the European Union will do so out of grievance and mistrust, as a protest against a society they see too welcoming of the mythical “other”, be it a Polish plumber or a Pakistani purveyor, a Hungarian Hussar or a Nigerian Naturalist, a Hong-Kongese Hoodlum or a Bangladeshi Burglar. A society that in their eyes has not only failed to prevent so many alien people from coming and settling in their midst, but is actively showing their preference for them giving them all the advantages of Britain’s generous welfare state rather than to the native born, impervious to the fact that such preference is mostly imagined, and falsely so (see this recent article by Polly Toynbee in the Grauniad: Be careful what you wish for, Brexiters).

A bit of good ol’ fashioned racism and a bit of sense of national identity seen under threat in times of turmoil and economic uncertainty, nothing new or exciting here, folks. Add to that the festering trauma of the loss of empire only six decades ago, which turned the country from the towering superpower of yore into a run-of-the-mill middling democracy, and one that has been loosing ground to Germany ever since the end of WWII (side note: do not forget that since the Peace of Westphalia the central focus of British diplomacy and international stance has been precisely containing Germany and the German speaking peoples of Central Europe, not my thesis but Brendan Simms’ in Europe: The Struggle for Supremacy) and you start to see why they seem ready to forego some points of GDP growth in the coming years (the most clear-eyed economists give a range between 2 and 4%, which in the present scenario of anemic productivity gains may mark the difference between minimal increases in per capita output and downright depression) for gaining what they see as a modicum of independence and dignity (again, most markedly the dignity of not having to put up with so many foreigners, the fact that the most troublesome amongst them come from outside Europe be damned).

The sad truth is that just having the debate in those terms is already a victory for the forces of reaction. If you were asked to choose between freedom and a few more coins, what would you choose? Especially when the loss of coin can be also discussed and even outright negated, as the liberty from the “heavy bureaucracy” will supposedly allow the British exchequer to save 350 billion pounds a year (a figure thoroughly debunked) and unleash the legendary entrepreneurial spirit of the nation. Which takes us to the side of those making such feeble attempts to convince their countrymen to stay. Nominally the head of the Tory government and his ministers, the head of the opposition party (Jeremy Corbin), the leaders of every UK company north of 100 employees and every writer, performer, university professor and publicly known figure you can dream of, having on his side the “serious” newspapers and the venerable British Broadcast Corporation. But all those concerted voices of reason and concord, all those sensible and exemplar citizens have been unable to convince a majority represented by a ragtag of disreputable politicians (Nigel Farage and Boris Johnson) and the tabloids.

Such are the whims of democracy, and they just reinforce my idea expressed in a previous post (on democracy's health) that representative democracy may have stopped being the most efficient system to aggregate the multiple preferences of our societies, as in the absence of “natural” external models (“outgroups”) against which compete in a structured fashion it makes some fractions of the “ingroup” turn viciously against each other (fabricating its own, convenient, at-hand “outgroup”) and, lacking a mutually agreed criteria for solving their differences, ends up resorting to numbers and humiliation. Again, as Mrs. Toynbee pointed in her article, linked above, the biggest concern comes from what may come after the referendum, as the passions aroused by the winning side will show difficult to contain, after they have been legitimized by the popular vote. Once you confirm the strength in numbers of your position nothing impedes you to demand ever greater submission of those that disagree with you. If you voted to leave Europe, economic consequences be damned, because you were fed up with the Pakis, and the Indians, and the Africans in your neighborhood, what will prevent you from actively pursuing their uprooting once the economy turns predictably to the worse and the size of the pie that can be distributed consistently shrinks? Class solidarity? Basic human decency? Doesn’t seem any of them had much impact when appealed to in the current election…

And probably this is what tips the balance for me regarding what I would vote if I were British (or what I will likely vote when the turn comes in my place). Listen, I get that Europe as is currently being constructed is a sham. That the Euro is a costly failure, a lovely common project that got hijacked by an unholy mixture of well-intentioned Germanic fundamentalism (indebtedness is always bad, no matter what you use the money for, and inflation is the work of the devil to be avoided at all costs) and difficult to predict double whammy of socioeconomic tsunamis (they couldn’t foresee that the all-too-evident demographic collapse unfolding under their noses would be compounded by the exhaustion of the capacity to innovate of the societies they were tasked with overseeing). If I could choose to stay within the unfathomable and not-too-overtly democratic institutional structure of the European Union (and keep the freedom of movement) and get rid of the Euro I would do it in the blink of an eye. But unfortunately that choice is not on the menu, neither in my country nor in England. What is on the menu is leaving the Union entirely, forsaking your country’s ability to influence the future development of the continent (limited as it may have been before, it was something) and jeopardizing your economy’s ability to freely trade within what is still the world’s biggest trading bloc. You may gain some similar ability by bilateral negotiation, but it will take time, the result is uncertain and your position will be undoubtedly weaker. And, in the case of England, they do not have the Euro millstone around their neck in the first place!

So, given the doubtful moral stance of the leave position, the unsavory company I would be in, and the fishy logic of the potential economic advantages (derived from them not being part of the single currency), I think I would vote to stay. There is another consequence of them leaving that also have to be considered: the Scots would get a new argument for secession that may finally push them to break the Union, as the EU is much more popular north of the border than south. Not that the jingoistic followers of Mr. Farage seem to be much troubled by that prospect, but it should give some pause to the conservative followers of Mr. Johnson for whom national greatness and cherished traditions seem better served keeping the Act of Union of 1707 alive.

The consequences for the rest of the continent are similarly dire. The stock exchanges are already discounting the loss of value of a Brexit, seen as a harbinger of more protectionism and less free trade. Within the EU, Germany would be far more dominant without the (already feeble) British balance, and France would be made more conscious of its subsidiary status. Furthermore, a Europe more heavily centered around the German inspired principles of sound money and austerity at all costs is wont to be economically even more sclerotic than what it has been until now (some feat!), prompting other countries to leave (the Scandinavian ones to pursue greater success outside, and the Southern ones unable to accommodate German orthodoxy with the plunging output their choked populations will be able to produce). Bad news all around, but bad news that are unlikely to tip anybody’s mind in the lovely island, as at this point they’d rather feel like Samson making the philistine’s temple come crashing down over their own heads than like Johnathan Swift’s Lilliputians, trying to secure another thread of twine to keep the gigantic Gulliver prostrate. All we can say is that in the long run, the role of the Lilliputian is far more useful, and far more beneficial, than that of Samson. 

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