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The Brexit farce The Brexit farce.

Brexit is a good thing for everybody
Globalization ends here
Articles on Britain published before 2016


  • (july 2016) The Brexit farce.

    The "Brexit" referendum has become such a farce that it is even difficult to understand who won. Boris Johnson, the most visible leader of the "Leave" campaign, has basically told Britain that he has no intention of leading the process, that he had advocated, of leaving the European Union. Nigel Farage, the leader of the Independence Party, has resigned. To an external observer, it sounds like the rats are leaving the sinking ship, except that these rats are the ones that made the hole.
    The very leaders of the Brexit campaign are opposed to a parliamentary election, despite the fact that the vast majority of parliament was opposed to leaving the EU, and therefore the current parliament is not qualified to represent the will of the referendum. The "Leave" camp basically wants a prime minister, a government and a parliament from the "Remain" camp to carry out the separation from the EU (perhaps in order to blame the "Remain" politicians for all the ills that will follow the Brexit).
    The very politicians who argued that the British currency would not collapse are now hailing the collapse of the currency as a boon to British trade (while at the same time repeating that the British economy is the fifth in the world, which of course is no longer true if the currency collapses because the British GDP is calculated in that currency). And so forth. Not since the days of Stan Laurel has Britain staged such a funny farce. It suddenly makes Italy's politics look austere and rational.
    The Brexit referendum can be summarized as "a Leave movement that treasured tradition and heritage over economic gain versus a Remain movement that downplayed tradition/heritage in favor of the economic advantages of globalization". Some in the Leave movement did not believe in the economics behind globalization but, more importantly, most of them didn't care. I don't think that too many "Leave" voters went to study the various technical arguments advanced by the experts. Most of them just didn't care what happens to the British stock market, to the British currency (called "pound"), to the British GDP and (ultimately) to the future generations. They simply wanted good old Britain to "remain" good old Britain.
    That is what is historical about his election: the elderly won. Among 18 to 24-year-old voters, the vote in favor of remaining in the EU was 72%. Among pensioners, it was 34%. Why the pensioners won? Because they voted in much greater numbers. This referendum sent a powerful signal that we no longer live in the Obama era, in which the vote of young people decides the elections. We entered an era in which an increasingly vast population of elderly people determines the outcome of the election. Many other developed countries (starting with Japan, Italy and France) need to wake up to the fact that they are becoming countries of elderly people, and the old adage "the future belongs to young people" is no longer true: these elderly people are going to stick around into their 100s (or so they think) and therefore are very interested in deciding what happens in the next 30-40 years.
    The lessons that young people around the world need to learn is that they are becoming a minority and their father does not care for their future the way their father's father cared for their father' future. It used to be that a parent in her/his 50s was mostly interested in the future of her/his children, whereas now that parent is still very interested in her/his own future. In other words, young people have hopefully learned that they have to go and vote. Way more than 70% of elderly people voted in the Brexit referendum. Way less than 50% of young people voted.
    Throughout the developed world we are going to witness the confrontation between the Baby Boomers who grew up in the 1960s and the Millennials who are growing up in the new century. The Baby Boomers loved sex, drugs and rock music, but it was sex with white kids of the same neighborhood, drugs made and sold in their home town by white friends, and rock music played by white people. The Rolling Stones were wild, but they had last names like Richards, Jones and Watts, not Khan or Patel. It was an illusion that the Baby Boomers stood for a progressive view of the world: they stood for a more material way of life, free from the religious constraints of the past, but they never stood for a merging of their civilization with other civilizations, let alone for an invasion of foreign immigrants who don't even speak English, are not even Christian, and are not even white.
    A geographic breakdown of the vote shows, as expected, that the opposition to leave the EU came from London (the capital that invented globalization and still funds most of it), Scotland and Northern Ireland. It would be easy for people like me, who deride the "united kingdom", to predict that Scotland will declare independence and rejoin the EU, but the facts are a bit more complicated: it is really London that lost the referendum. Scotland is a loser whichever way it goes: independence and the euro will not come at a cheap price. Northern Ireland could vote for union with Ireland, a logical outcome that has been delayed by military occupation, but it would join a poorer, not richer, country. This was really a vote for English (not British) nationalism, a vote against the people who don't respect England, people which include both Scotland and London (which is English only in name, de facto an international financial hub that will prostitute itself any day of the year to the highest bidder).
    This nationalistic feeling is somehow related to the de-industrialization of England and Wales, because the de-industrialized regions are the ones where the "Leave" vote was higher. These are people who miss the factories, the mines, and the pollution of the 1960s. They are nostalgic about the very industrialized world that was demonized by the intellectuals. They have seen the "service" economy and they are not convinced that it is better for them than the factory.
    The other big winner of the referendum is obviously the anti-immigration camp. European politicians are guilty of denying the obvious. Obviously, Europe is being invaded. Obviously, Muslims are exporting to Europe not only their religion (which most non-Muslims truly dislike, and not only in Christian Europe) but also the problems that come with that religion: sexism, religious intolerance, hostility towards education, poverty and civil war (all facts routinely denied by politically-correct politicians and commentators despite the ever mounting evidence around the world). Anti-immigration parties are winning more and more votes in Italy, France, Holland and Austria, and they are already in power in Poland and Hungary. The anti-immigration camp may have a lot of facts wrong (e.g., very few people mention that Eritrean Christians and Syrian Christians are among the largest groups of refugees from non-EU countries and that the vast majority of immigrants to Britain are from white and Christian EU countries) but its main point is a simple fact: we are witnessing the biggest invasion of Europe by non-Europeans ever, and, in particular, the biggest invasion of England since the 1066 Norman conquest of England under William the Conqueror. Denying it is not a good way to gain the trust of your voters. Don't complain if your country will be next. Voters are not blind: it doesn't take a PhD to count the number of foreigners in your neighborhood and compare it with the number of ten years ago.
    Besides cultural/ethnic factors, there is also a simple demographic factor: population density in England is almost 420 people per sq km compared with 70 people per sq km in Scotland. France's population density is 120 people per sq km. England is overpopulated: no other European country has such a density of population. The polls were showing a narrow majority for the "Remain" camp until the end of may, when the Office for National Statistics announced that net immigration into Britain had set a new record of 330,000. From that day on, polls showed that the majority shifted towards the "Leave" camp.
    Many commentators in the USA are implying that the British anger at the EU might be similar to the anger of the middle class in the USA at the Washington establishment. I think the similarities are rather in the technique used by the "Leave" camp to win the referendum, which is eerily reminiscent of the tactic used by Donald Trump to win the Republican nomination. The leaders of the Leave campaign were three reckless demagogues (and borderline sociopaths): Nigel Farage, Boris Johnson and Michael Gove. They used a mountain of lies and exaggerations to make their argument sound convincing. When faced by the press with specific facts, they accused the questioner of lying and worse. That's typical Donald Trump tactic: accuse the accuser. When told that all experts disagreed with his analysis, Michael Gove replied: "People in this country have had enough of experts." Donald Trump could have said that. Ultimately, they shouted "Let's make Britain great again" exactly like Donald Trump shouts "Let's make America great again", based on absolutely no sound policy and sometimes not even a ghost of an idea.
    The globalized world is so complex that ordinary middle-aged people have lost the ability to understand it and are desperately looking for someone who can simplify it for them. Voters of previous generations always could (or at least they thought they could) identify the causes. If they didn't like A, they would vote for the politician opposed to its cause. But this has become just too difficult. Middle-aged people have a simple recipe: let's go back to the simpler life of the non-globalized world. Anybody who lies to them and tells them that this can easily be done is welcome as a prophet. Younger people, armed with their smartphones and social media, are less concerned with this globalized world not because they understand the issues better but simply because the advantages outweigh the disadvantages for them. They can't wait to travel, experience the world, date exotic foreigners, study abroad, work in places with good weather or exciting technology... generally speaking, they don't want to be trapped in the neighborhood where their middle-aged parents feel safe. If the price to pay is a mosque round the corner, so be it. They are not planning to live there for much longer anyway.
    The Brexit farce will play out for a while, precisely because none of the winners knows what to do with his triumph. The queen of this "united kingdom" will not be amused.
    There are two realistic scenarios going forward, and, ironically, neither includes a "Brexit". In the first one the new British prime minister is a hater of the EU and will spend all his time sabotaging everything that the EU tries to do, easily justifying himself because of the mandate received by this referendum. In this scenario Britain does not leave the EU but causes the EU to sink. Eventually other countries start leaving the EU because Britain makes it unworkable. Britain literally causes the EU to implode, and then the British prime minister can tell the British public "See? I told you so!" Self-fulfilling prophecies are generally the ones that come true.
    It is always a bad idea to predict the future, but i'll predict that the second scenario is the more likely one: Brexit = Grexit, i.e. Britain will not even try to leave the EU the same way that Greece did not leave the euro. A Brexit would be just too complicated and painful; and all the lies of the "Leave" camp will quickly come to the fore even for the most stubborn Euro-haters. It almost sounds like the "Leave" camp itself wasn't expecting a victory: they don't have a plan, not a plan A and not a plan B or C. Remember "Grexit"? That was another case of a tiny indebted country making a lot of noise. Remember the anti-austerity rhetoric of Greece's opposition party Syriza, that eventually toppled the government and swept to power? The pessimists predicted that Greece would be forced to leave the euro and some even predicted that the euro would soon collapse. Syriza pledged to renege on the program of austerity only to... implement every word of it! I predict that an anti-EU politician will become the new prime minister and will spend the next two years buying time. Then he will beg the EU to make a couple of concessions on immigration that he will sell to the British public as reasons to hold a second referendum, and the British public will overwhelmingly vote to remain in the EU. Case closed, and the EU will be the real winner of the Brexit referendum.
    TM, ®, Copyright © 2016 Piero Scaruffi All rights reserved.
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  • (june 2016) Brexit is a good thing for everybody. (A not-so-humble proposal for the EU to stop meddling into British affairs and, more importantly, a humble proposal for Britain to stop meddling into EU affairs)
    The implications of a British exit from the European Union (a "Brexit") for Britain could be devastating (yes, i know that the "Leave" movement thinks otherwise, and it's fine with the rest of the world if they believe so). The implications of Brexit for the rest of Europe are negligible (except maybe for Ireland). On the contrary, a Brexit would probably strengthen the European Union because Britain has always been the recalcitrant member that slowed down progress towards real political integration. Even the pro-EU politicians admit that they would never surrender sovereignity to a supranational entity. It sounds like a no-brainer: let Britain go (or, even simpler: just expel it, so it doesn't even have to hold the referendum).
    The European Commission is not an elected body, the European Court of Justice (ECJ) has little to do with justice, the European Parliament is not a democratic institution, and the European currency (the euro) is optional for member states and left without a fiscal union and without a banking union. The British are right to complain about this but they forget to mention that it is their fault if no progress has been made on all of these issues. The European Union needs to transform itself into a fully democratic and antinationalistic United States of Europe, and this will not happen for as long as hyper-nationalistic Britain is a veto-wielding member of it. The British are right to point out that, for example, the Treaty of Lisbon was forced on European citizens by an elite that found grotesque ways to avoid a popular vote after the text had been rejected by French and Dutch voters, literally overriding the voters' decision; but the British forget to mention that awful treaties like the Lisbon one are the effect of British opposition to sensible treaties. If Britain decides to remain in the European Union, the EU should hold it accountable for the financial problems of the eurozone. It was Britain that opposed any serious fiscal and banking union. The victims are millions of unemployed people around the continent while the crooks of the city of London continue to speculate on the victims. The decline in Euro-enthusiasm across Europe is largely due to the reforms that never happened because of British opposition. Britain has de facto been sabotaging the European Union.
    Analysts may be sorely mistaken about who is opposing the EU in Britain: it is not the workers, nor the lumperproletariat, but the educated and rich white elite. Boris Johnson got his degree at Oxford University. The "liberal" press is mostly in favor of leaving the EU. Those who know and treasure British traditions are more likely to vote for an action that will cause economic pain but will restore British pride.
    Let me tell you an apocryphal anecdote, which may or may not be historically accurate. When the world cup of football was launched in the 1920s, Britain stayed out of it. Britain felt that they had invented the game, and they already had an internal competition that featured England, Scotland, Wales and Northern Ireland (for those who don't know it, these are the four "states" that constitute the United Kingdom of Great Britain). In 1950 England was willing to join the world cup but Germany objected to the idea that Britain had four national teams: after all, West Germany consisted of not four but ten states. For the record, Brazil consists of 26 states and the Soviet Union at the time consisted of 15 republics, one of which (Russia) was in turn a federation of other republics. So it sounded a bit funny that Britain would get four national teams instead of just one. The British were adamant that they, being a superior country, deserved four national teams, not just one like everybody else. One country came to their rescue: Italy. Italy was perfectly happy that Britain would split its best players among four teams. The result? England made it to the final of the world cup only once (in 1966, when it won), whereas Italy made it to the final 6 times and won 4 times. Scotland, Wales and Northern Ireland never even made it to the semifinals. So Britain keeps its royal (imperial?) pride, whereas Italy gets to win a lot more often. Other than David Beckham, it is hard for foreigners to name a great English player, who has won a lot internationally. On the other hand, it is easy to name a great Welsh player (John Charles, and today Gareth Bale), a great Northern Irish player (George Best), a great Scottish player (Kenny Dalglish). Imagine if these champions had played in England's team (with the likes of Bobby Charlton, Bobby Moore and Beckham) instead of being relegated to the national Welsh and Northern Irish teams (you didn't even know that such teams existed, did you?) Bale is widely considered one of the greatest living players and, still, he has never played in a world cup. That anecdote explains a lot about the British who want to leave the EU. It is not about winning, it is about national pride. They want to leave the EU and pay the consequences for the same reason that they have no intention of unifying those four national teams in one, no matter how much the world laughs at that oddity and how badly they lose in all international competitions.
    The British are right to be proud of their Magna Carta (1215) and of their Bill of Rights (1689), and we are all thankful to them for changing the history of the world in 1215 and 1689. But the rest of Europe should try to live in 2016, not in 1215 or 1689, lest it is being left behind by the rapidly advancing civilizations of East Asia, not to mention tiny Silicon Valley that, in every single high-tech sector that matters for the future, has ten times more startups than the entire United Kingdom of Great Britain combined. In 2016 there are other examples to follow than Britain's.
    13 countries have joined the EU since 2004, and more would gladly join if not threatened at gunpoint by Russia. Will anyone notice if 1 country leaves it, the one country with a current-account deficit that is 7% of its GDP? i.e. the one that is borrowing the most from foreigners to sustain its bubble economy? Moritz Kraemer from Standard & Poors: "Britain is the world's most vulnerable state on a key measure of short-term debt... the British financial system is extremely dependent on external financing... Debt coming due the next year amounts to a whopping 755% of the UK's external receipts...", the highest of all 131 countries that are rated by Standard & Poors.
    There are much bigger challenges in the world: Russia's new Cold War, China's aggression towards its neighbors, and the endless mess in the Islamic world. The European Union can help with some of them, Britain is a useless vassal of the USA. Brexit-ers probably believe that the USA will still value the alliance with Britain, based on the handful of aging atomic bombs that Britain is hiding somewhere, and based on the willingness of British soldiers to fight in the wars that the USA starts; but most young Northamericans cannot find tiny Britain on the map.
    The Europeans should remove the English language from the European Union. Once Britain leaves, none of its member states speaks it, and the majority never did. German is the most spoken language within the EU. Of all the languages of the European Union, Spanish is the one that has the most speakers in the world. French is spoken by four member states. Why use English? In the age of machine translation, it is not even necessary to pick one specific language for official documents.
    While they are at it, Europeans should also remove the privileged status of Switzerland. Norway is in a strange limbo: it enjoys all the rights of EU members and pays its dues for it, except that it has no voice in the decisions made by the EU. It is a good deal for the EU. If Norway likes it that way, fine. It basically chose the status of colony.
    Switzerland, instead, gets too sweet a deal and should be left to itself. Switzerland has basically been blackmailing the EU because of its strategic geographic location: all traffic of goods among Germany, Italy and France goes through Switzerland. But in 2016 the traffic of information over the Internet is much more important than all those antiquated trucks. Removing Switzerland's privileges would simply encourage multinationals to open more local factories instead of shipping products from their headquarters along highways and railways.
    We greatly respect the historical legacy of Britain, and greatly respect its great thinkers, writers and scientists, who will be studied all over the world for centuries to come. The EU should certainly make sure that Britain (or its successor state, if Scotland ever succeeds in getting rid of centuries of occupation) will always have the option to rejoin in the future... assuming that it accepts the conditions of total, utter, irrevocable surrender to the European Union with no veto rights.
    In conclusion, maybe the EU should stop meddling into British affairs, and Britain should stop meddling into EU affairs.
    TM, ®, Copyright © 2016 Piero Scaruffi All rights reserved.
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    Globalization ends here.
    Globalization was born in Britain. The first globalized economy was the economy of the British empire. Back then the British citizens were very happy at the idea of free trade across five continents. They even enforced it with the warships when China tried to stop Britain from selling Indian opium to Chinese consumers. Times have changed. According to the latest Financial Times' poll of polls, a majority of British voters now would prefer to leave the European Union. Tiny Britain, that most of the world's population under 20 cannot find on the map, could also become the place where globalization dies. The movement didn't start in Britain. Winds of change have been blowing from a while. For example, Polish voters favored the euroskeptic Law & Justice Party in Poland (an ironically named party, because the European Commission is accusing it of tampering with the law). The issue is not the economy, it is the cultural diversity that comes with globalization, and specifically immigration, and even more specifically (sorry for being politically incorrect) Islam. Muslims are viewed as exporting their mess, their poverty and their bigotry to the European countries that never invited them and that don't need them. (Make no mistake: i totally blame the Muslim population in some of these countries for creating the anti-Muslim sentiment, as i have frequently written). Because of Muslim and inter-European immigration, every country of the European Union is changing, every city is changing, every neighborhood is changing. The people who grew up thinking of themselves as, say, Polish can no longer tell what "Polish" means. "Polish" used to mean Catholic, Slavic, blond hair and blue eyes, well-versed in Polish literature and classical music. The European Union wants them to accept immigrants who are completely different, who will change what "Polish" means the same way that Muslims changed what "French" means. And so the Poles voted against the previous government, despite a historical economic boom. They voted a new government in power that has already caused economic damage but has promised a little "ethnic cleansing" that would restore Polish dignity. The British, being a former imperial power, are particularly vulnerable to the seduction of nationalism. They absorbed huge minorities from the colonies but those were the days when the colonized wanted to be accepted by the colonists. (History is funny: the British have to thank Gandhi if today they are still ruled by white prime ministers. Had the Indians decided to remain in the British Empire, it is likely that today Britain would be ruled by Indians, given that today India's population is 20 times Britain's, not counting Pakistan, Bangladesh, Burma and Sri Lanka). I have argued for decades that the European Union should expel Britain: it would be a better union without this annoying British nationalism. But now the point is that the British voters are part of a bigger movement and they may end up spearheading a worldwide trend. (To be historically accurate, the anti-globalization movement was yet another idea pioneered by Italy, the first Western country to enjoy a xenophobic party in power, the Northern League, and later the place where the anti-G7 protests erupted in urban guerrilla warfare; Italy being the country that pioneered influential ideas such as the mafia, fascism and billionaire heads of state).
    At the same time that British voters want to leave the EU, voters in the USA have chosen Donald Trump as one of the two candidates to become the next president. Some polls even show Trump ahead of Clinton. I have written before ( What Donald Trump represents) that Trump represents the uneducated older blue-collar white males who are nostalgic about their old-fashioned "America" (the same old white males who never figured out that America is a continent stretching from Canada to Argentina) with its bbqs, country music and baseball games. A commentator on the right-wing tv channel Fox News (which i nicknamed "Fix News") blasted the World Cup of soccer and the metric system as decadent "liberal" values ("liberal" is a bad word for these folks). Trump offers US voters exactly what Boris Johnson offers British voters: the illusion that globalization can be stopped and the world can be restored to what it was before 1991 (fall of the Soviet Union).
    To be fair, Trump and Johnson are the product of all the politicians and media that demonized globalization. British politicians spent too much time denigrating the European Union: Boris Johnson is the by-product of their euroskeptic rhetoric. Republicans spent too much time ranting against the United Nations. And too many European populists picked the euro as the scapegoat to justify the deepest economic crisis in the world because they didn't want to solve the real problem (huge budget deficits). Eventually, these politicians and media created a huge movement of voters that demonizes anything "international".
    It would be fitting if the referendum in Britain triggered an avalanche of similar "exits" from the European Union and possibly from NATO: globalization was born in Britain and it should die in Britain.
    TM, ®, Copyright © 2016 Piero Scaruffi All rights reserved.
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TM, ®, Copyright © 2015 Piero Scaruffi All rights reserved.