By Raymond Freeman
Right-wing politicians in Britain now lie as brazenly as Donald Trump, such that the Brits voted to jump off the cliffs of Dover. Will Americans follow them?
Britain joined the European Common Market in 1973. Many European regulations were tiresome but at least there were common standards for free trade. Goods were no longer held up at borders due to silly national differences. Britain shed its reputation as the Sick Man of Europe, sending 44 percent of its exports to mainland Europe, and became the world’s fifth-largest economy. Not bad.
But the European bureaucracy became arrogant. It tried to ban the beloved British “bangers” (sausages) and tried to introduce Nazi-style identity papers. These annoyances were usually defeated, so life went merrily on. But there came a big push for closer integration. A common currency, the euro, was introduced, together with free movement of capital and people. More countries were admitted to the European Union (EU). The Brits said “nein” to the euro but were outvoted on other issues. Hence, anyone holding an EU passport could move to Britain.
Many Eastern Europeans did just that. Many had learnedt English in school and Merry Old England is a great place to live. Not surprisingly, The Economist stated that Britain would become the most densely populated country in Europe by 2050. A new political party, the UK Independence Party (UKIP), arose to stop this.
Tall tales abounded as to how immigrants were stealing jobs and getting welfare benefits. True, they take low-paid jobs, but overall, foreigners give far more than they take. Their contribution to high-tech industries is outstanding. Moreover, London became the financial center of Europe due to the free movement of capital and skilled labor.
But for many people outside London the economy is in the doldrums. Inequality is almost as bad as America’s. Prime Minister David Cameron gave in to pressure from his right wing and the far-right UKIP. He put the question of leaving the EU to a referendum (a special vote). All the bookies predicted a Remain win. Amazingly, the Leave side won, 52-48.
The lying by UKIP was utterly shameless. It said Turkey would join the EU, whereupon millions of Turks would flood into Britain. It said that Britain gave 350 million pounds a week (a wildly inflated number) to Europe, which could instead be spent on the beloved National Health Service. It declared that Britain could stop immigrants pouring in and still get the benefits of free trade with Europe.
The rebuttals to these lies were dismissed as mere “opinions” of experts who had been wrong before. The Remain case was feeble, stressing the negative economic results of leaving as opposed to any positive vision. It failed. Cameron resigned.
The British public finally realized they could not have it both ways with Europe. To keep free trade, they would still have to follow EU regulations, pay into the budget and allow free immigration. Fury mounted as the extent of the political rip-off sank in.
The results predicted by the derided economic experts came to pass. The pound dropped to a 31-year low. France’s economy has overtaken Britain’s as the fifth-largest because it uses the euro, not the weakened pound. The economy of the British peoples will shrink further because Scotland wants to stay in the EU and wants a divorce from England. Britain’s divorce from the EU will take years to negotiate. This is officially Bad News. Financial markets detest uncertainty.
Globally, $3 trillion was wiped off stock market valuations of companies affected by “Brexit” (Britain’s exit). London’s financial industry, which accounts for 12 percent of Britain’s economy, will be hit hard when much of Europe’s financial market moves to Frankfurt. A recession has been forecast for Britain.
A friend of mine in Liverpool owns an engineering company. He exports to Europe. He believes Brexit will be “disastrous.”
The parallels with America are obvious. We have a shameless liar and world-class rip-off artist running for president. The world’s top banker, Christine Lagarde of the International Monetary Fund, told the Financial Times that Trump would be “disastrous” for the world’s economic system. I believe Lagarde is correct.
America is a world-class deadbeat, financially speaking. We import far more than we export, producing a large deficit on current account. As a big secret, we therefore depend on foreign investors to finance it. But Trump has bragged that he may rip them off like his contractors, bankers and investors. Somewhat obviously, foreigners would stop investing here. The dollar would therefore plummet and interest rates would rocket, thereby increasing our cost of living and causing a global recession.
The likelihood of Trump becoming president, with a rubber-stamp Republican Congress, is slim to none. Mercifully, the likelihood of Americans jumping over the cliffs is also slim to none.