Beware a botched border

A botched border will be bad for all .

It’s the EU that wants the wall not us – and I wish that our politicians pointed this out more often. The UK and Ireland governments have made great strides in trying to reach a settlement for Northern Ireland and this could unravel  if the  EU are not pragmatic in their approach to the Northern Ireland.

In some recent coverage on the radio along the Northern Irish border there was lots of talk of not wanting the return of the “watchtowers” and the “troops” along the border as we had during “The Troubles” between 1968-1998.

And what irks me about this is two-fold – firstly the UK voting to leave the EU  does not mean we have to put up a military presence along the NI border. The Troubles are long  over and many of the reasons for having the military border have gone.

The second reason and the most important of the two – if the EU insists on a hard border it will not have been imposed by the British, but by the EU. There is not a lot of support for this anywhere in Ireland and the UK government should continue allow Irish citizens to pass freely into the UK,  as they have been able to do so.

Imagine  a scenario where the UK keeps the border much as it is now  – open. And the EU build a customs border on their side. It would not be the UK causing security and customs delays. Instead it will be the EU forcing a border on the Irish mainland. Irish haulers and government would then have to lobby/petition at an EU level to remove the log jam of goods crossing into UK and back again. In this situation the UK position at an EU level would be weaker and we would have to allow the Irish to do our bidding.

The EU fears by keeping an open border between themselves and the UK , that goods from let’s say, America,  could creep into the EU. The UK could simply mandate that all products be labelled as made in the USA like we do already , and then simply let the consumer choose. If they want beer made in Germany with a Texan steak who are we to get in their way ? If free trade is good across the EU then why is it any worse if  we just extend that boundary to include the globe ?

This logic reveals the EU for what it really is, an intra-nation free trade area with a common tariff  border to the rest of the world. As opposed to an international free trade area .

The British and Irish governments have long had a common travel area (CTA) which allows for easy movement of people dating back to 1925 – well before the creation of the EU. Therefore is no reason why an agreement could not be reached on goods crossing the border now.  Electronic customs solutions for goods already exist,  adopting blockchain technology could be used to ensure that there is an accurate record of what has crossed the border. There is no point in re-inventing the wheel for customs clearances , we should adopt technology in lieu of border bureaucrats.

There is nothing that stops the EU making an exception in this case . Such exceptions are already in place along border between Norway and Sweden, and the border between Germany and Switzerland. Both of these borders have components which could be incorporated into creating a no border situation. Not only would this be helpful for NI, but the UK as a whole. Any solution used by the UK and the EU could always be used a template for other accession countries or be used with other nations who want to trade with the EU bloc but want to avoid political entanglements.

As final thought, replacing my economics hat with a political one, we have to consider the actors and their intentions. The border could well be used by Politicians on both sides as a stalking horse.

The Irish could demand that they will forgo a border as long as NI adheres to the same regulatory standards as the Irish have. This would mean that the EU has a border inside of the UK. I doubt that Westminster would go for that. But for the Irish government this would be a win as it would bring NI closer into their sphere of influence; perhaps even realising their dream of a united Ireland again.

On the UK side the threat to build a wall may well force the Irish government to compel  the EU negotiating team to give concessions such as passporting for financial services or generous access to single market etc.

Perhaps this is the real reason that power is not going back to the NI assembly – maybe an ace up May’s sleeve.

First published on stopflyingtheflag.com.

See EU Later: 5 Options for post-Brexit trade

GreenGlobe by Jonathan Gross

Last month the EU Referendum engaged more people in politics than any referendum or General Election since 1992. The fallout just keeps coming as both the main political parties face leadership contests and yet more resignations are still expected. As I write this, Nigel Farage has quit as UKIP leader (again), so it looks like we’re running head first into week three of political carnage since the referendum result. Brilliant.

Despite uncertainty about when or if Article 50 will be triggered, it is largely accepted that the UK has now been presented with an opportunity to cut ties and seek its own trade deals on its own terms. Now, as the dust settles, it is time to start considering with whom these deals could be struck.

Option 1: The EU

Hold on, haven’t we just voted to get out of this?

Well, yes, but we can still trade with them without being a member of the club.

There are more than twenty countries that have trade agreements with the EU. The European Free Trade Agreement (EFTA) is currently shared by several countries in Europe which are not actually EU members. Founded in 1960 by 7 European countries, this is seen as the most likely option for the UK to adopt post-Brexit. In fact, we were a founding member of the agreement, along with Austria, Denmark, Norway, Portugal, Sweden and Switzerland. However, we left in 1973 in order to join the European Community, and some argue this is where it all went wrong.

The Norwegian model is seen as the most viable option for the UK to adopt. This would give us full access to the single market through membership of the European Economic Area (EEA), although we would also still have to make a financial contribution and accept the same free movement agreement that we had while inside the EU. Iceland also shares this model, and was the first country to reach out to the UK to strike a post-Brexit deal.

Another EU trade possibility is the Swiss model – largely revered by libertarians for the simple fact that the Swiss have low taxes, are both prosperous and peaceful, and have a close form of direct democracy. It is no coincidence that a lot of multinational companies choose to base their headquarters in Switzerland, and that is partly down to their ‘best of both worlds’ bi-lateral trade deals with the EU.

The Swiss-EU agreement allows free trade (i.e. trade without tariffs) with most of the industries that make up the single market. Switzerland is neither an EU nor EEA member but is part of the single market. This means Swiss nationals have the same rights to live and work in the UK as other EEA nationals. However, Swiss trading success has partly been down to their substantial annual contributions to EU projects so it is likely that we would also end up pumping a lot of money into projects that we now have no say over.

These are two viable – if imperfect – options for the UK, but would not be enough to ensure financial stability alone. The Adam Smith Institute has backed an EFTA-style deal for the UK, but recent figures from the Office of National Statistics show that the UK is actually exporting more to countries outside the EU now than it was in 2011, so while EFTA looks like a good option, it makes sense for us to widen the net.

Option 2: The USA, Mexico and Canada (North American Free Trade Agreement: NAFTA)

In 1946, Winston Churchill coined the phrase ‘special relationship’ to describe the integrated political, cultural, economic and historical relations that the US and UK have long shared. Despite Barack Obama’s rather unwelcome appearance halfway through the pre-referendum period (the one where he said that the UK would be “at the back of the queue” in any post-Brexit trade deals) it seems that we are in fact still in the ‘special relationship’ and nothing much has changed.

Canada is currently only the UK’s 16th largest export market, and earlier this year Romania, Belgium and Bulgaria were reported to be planning to veto an EU trade deal with Canada, citing ‘unfair visa arrangements’. The UK could and should use this as an opportunity to strike a better trade deal with Canada while the EU tries to figure out a ‘one size fits all’ resolution to the issue. Canada have already said they are cautious, but see the UK as a strategic partner and so are keen on maintaining ties.

Mexico has gone one better and actually drafted a trade pact which is ready for whoever takes up the challenge of negotiating Britain’s exit after Cameron leaves.

Miriam Sapiro, ex-deputy US Trade Representative, has also said that it will be easier for the US to negotiate a trade deal with Britain post-Brexit, as we are a “like-minded” country that is more open to free trade than other EU member states. It seems that ‘back of the queue’ gag may be forgotten by the time Obama leaves office, if not before. It has even been suggested that a quick ‘remedy’ to our Brexit woes would be to add the UK to the NAFTA deal, and ensure those ties don’t break at all.

However, trade with the US comes with a warning: TTIP.

The main aim of the Transatlantic Trade and Investment Partnership is to set standards for any future trade deals done with the US and, eventually, the rest of the world. If you haven’t heard of it, that’s probably because the negotiations have not exactly been conducted in public.

The proposed deal would see the removal of tariffs and regulatory barriers to trade between the US and EU members. The British government claimed that TTIP would add around £10bn to the UK economy, and open up restrictive markets, allowing us to buy goods such as clothing and cars at cheaper rates. On the surface, that doesn’t sound so bad.

Conversely, a TTIP deal would also introduce Investor-State Dispute Settlements (ISDS), which would allow US companies to sue EU governments if their policies interfere with their profit margins. The EU itself has said that this deal would cause the loss of millions of jobs across EU member states, and critics have also pointed out that TTIP would introduce heightened surveillance of citizens under the guise of ‘anti-counterfeiting law’.

As this agreement is currently only being very quietly discussed between the US and EU, it seems that we have dodged a bullet by voting to leave. However, it is likely that TTIP will be a condition of any future trade deals between the UK and NAFTA, especially since our government is so on-board with the idea.

Option 3: The BRICS bloc

(Brazil, Russia, India, China and South Africa)

The BRICS are characterised by being BIG. Big in size, big in natural resources and big in young populations full of people wanting to work and travel. It’s no secret that this collection of nations isn’t exactly viewed as the first choice for trade agreements by many Western countries. Indeed, Russia had diplomatic sanctions imposed on it by the EU following its annexation of the Crimea. China has a questionable human rights record, and Brazil’s desperate scramble to prepare for the Olympics has thrown light on a nation with weak infrastructure and a faltering economy.

These uncertainties partly explain why the BRICS bloc is less competitive than other trading blocs and, although large companies benefit from this, small and medium-sized enterprises (SMEs) in the UK are far from making significant progress with them. Since 2013, the UK has more than doubled its exports to these countries, but there is still a legacy of British reliance on western demand when it comes to trade, and so George Osborne’s attempts to negotiate further trade have come under intense scrutiny.

Since the referendum, India has jumped straight in and is very much looking forward to striking a trade deal with the UK. Our former colony has a very positive outlook on Brexit, with Jayant Sinha, India’s deputy finance minister, claiming that ‘the UK will look to build its relationships with the rest of the world, and will seek to pursue new opportunities with India”.

This is a group of countries which may offer fantastic future opportunities for more trade agreements. However, the diplomatic ties that many countries in the West hold with this bloc will likely need to improve before they can be considered in the same league as the EU for trade negotiations. Nevertheless, it is likely that other countries will confirm their interest in trade deals with the UK in the coming weeks, with all eyes on Russia and China; more on South Africa a little later…

Option 4:  Australia and New Zealand

Since the news broke that the Brits had opted to Brexit, Australia and New Zealand quickly teamed up to negotiate new trade and immigration deals with the UK as soon as possible. Our ex-colonial friends have long been trying to find a way to trade more successfully with the EU, but the UK’s withdrawal makes any such agreement a bit less attractive.

The UK has long been a significant trade partner for Australia as it provides a services-based relationship worth around £5billion. It is widely acknowledged that when the UK joined the EEC in 1973, trade with New Zealand took a hit. Having once imported a little under 80% of our dairy and meat products from NZ, the UK (like all other EEC members) rapidly became flooded with European goods, leaving little room for imports from outside the bloc.

We now only import around 20% of our meat and dairy goods from our cousins in New Zealand, and given the immense historical ties that we share with the ANZAC nations it makes sense to shore up agreements with these countries while they are open to it. These are important nations with which to secure trade deals, not only for their economic value, but for the social security of the millions of UK expats who are shared between them.

Option 5: Africa

Africa is still largely seen as the ‘final frontier’ for many multinational businesses, but more and more small and medium-sized enterprises (SMEs) are realising the huge potential that foreign investment and trade can have in this region. Historically, the African relationship with the EU has been one of forced trade and destructive agreements which have largely been blamed for the increase in poverty in many African countries.

In 2013, the UK made steps towards improving trade with Africa, with the aim of completing these improvements by 2016. The Government has so far pledged to invest £57.4 million to improve trading in Uganda and Kenya and modernise East Africa’s largest port in Mombasa. It has also promised to improve roads on a vital trade corridor between Uganda and Rwanda, and put further investment into female entrepreneurs across the region.

These initiatives do not require “EU funding” (i.e. pre-digested UK taxes) or legislation to support them. It seems logical that we take this to the next level now, and really open ourselves up to the wider continent, from Tunisia right the way down to South Africa. Ghana has already extended the UK an invitation for new trade negotiations, and it is possible that other countries will follow suit in the coming weeks.

This investment in the continent will allow many countries to continue producing crops and commodities more efficiently, and in turn give us more stable and rich economies with which to trade. Within Africa, South Africa is currently the largest recipient of UK exports, and the burgeoning middle class in this country is presenting many opportunities for UK SMEs to sell their goods. This is a growing trend in other markets, particularly Nigeria and Ethiopia which have seen dramatic growth over the past decade; now is a great time to get to know them better.

Far from the bleak picture painted during the referendum campaign, it seems that the UK actually has many options open to it at the moment. Whether we choose to negotiate a safe Norway-type model, or broaden our horizons to the BRICS, the coming months will no doubt show that we can be more outward looking than our European neighbours, and more creative in the way we form trade relationships with other nations. The important thing to note is that we are not limited to just one agreement. We now have an opportunity to make trade ties with many countries both inside and outside the EU. They are open to it – and we can be, too.

Brexit: Politics Is About Picking Winners And Losers

The outcome of the EU Referendum for the UK to exit the EU has caused an enormous outrage among the ruling class in the UK and also in other EU states. As they always do they had mobilised all their power and influence to scare people into voting for the EU membership. They have a lot of experience doing this and it usually gets them what they want.

Not this time! This time the question on the ballot box was very simple. This time it was a direct vote count, and the majority won. This time, people made up their own mind and voted out. They did so for various reasons, but undeniably a good part of it was a protest against the current political order. They felt that their voice was not being heart. They felt that the system did what it wants and did not serve them.

The reaction of the elites in this countries reveals that their instinct was correct. The amount of contempt against anyone who dared to vote out is unbelievable. I am not shy in stating my opinion and I am used to not get applause for it. But even I caught myself trying, in some conversations, to hide the fact that I had sympathy for an out vote.

In all of the public discourse about this vote the underlying assumption is clear. This was a mistake, brought about by uneducated, xenophobic and even senile working class people who were seduced by evil powers. Everyone who can think rationally, anyone who truly understood the question and everyone who is a decent person could have only possibly voted for staying in the Union.

These people show that they do not like being challenged in their political world view. Everyone can see now how arrogantly they think they know better than everyone else and therefore no one should oppose them. Most importantly though, these people clearly show that they are not used to losing. They are the once who are on the winning side of the system. And suddenly they find themselves on the side of the losers and cannot deal with it. A lot of them have called for a new referendum, since clearly too many people did not understand what they were voting on. They are even trying to figure out if there is any way with which they can ignore the outcome of it.

Don’t get me wrong. I can see that this referendum gets some people into trouble that do not deserve it. I talked to a lot of EU friends in the UK of mine, who are now wondering whether they can stay or not. They probably can, but most definitely facing a lot of new bureaucracy to do so. This referendum was not a clear cut case from a libertarian point of view. There are winners and there are losers. The reason why I am like the out vote is, because this actually changes the political system itself and I think the new order will overall advance liberty. I have explained this in detail in my article “Why the EU is the wrong tool to defeat nationalism”. But still there are losers in this, who should not be losers.

But the point that the elitist remainers do not seem to understand is that politics is always about picking winners and losers. That is how the system works. So finding yourself on the side of the losers for once, or let us be honest here, finding yourself on the side of having to give up some of the privileges, which is not the same as losing, is not an argument that there must have been a mistake. Only on the free market everyone wins. In Politics, someone always has to lose. So if you really want a system in which no one losers, you will need to advocate a system of liberty.

That lesson however, no one in the elite really seems to want to learn. Instead they hope by moaning, kicking and screaming they can go back to the system in which the losers are the others. And you know what, this time this will be difficult, but unfortunately they have a very realistic chance of achieving this goal. Let us use this chance to expose them, to make it as difficult as possible for them.

The EU is the Wrong Tool to Defeat Nationalism

I am very much an individualist. As such I have always despised nationalism. I am convinced that we need to overcome this ideology if we want to live in a free world. One could think now that, since I hate nationalism, I probably should like the EU. The core political agenda of the EU has always been to defeat the nation state. And it seems to work to some degree. All nationalists that I know, have a passionate hatred for the EU. And it is nationalists who are very much behind the campaign to get the UK out of the EU.

But I have to say that I have always mistrusted the logic of ‘the enemy of my enemy is my friend’. As much as I dislike nationalism, I also dislike the EU. The EU is simply the wrong tool to defeat this ideology. Neither do I think that it will succeed in defeating nationalism, nor do I think that if it did, it would replace it with something better. The opposite might very well be the case.

The biggest problem with nationalism is that it is married to the state. I cannot think of any coherent theory of how to identify a nation that does not involve a state like political structure. So strong is the connection that every nationalist movement seem to automatically aim for a sovereign nation state. That is why we are seeing all European nationalists cry for an end of the EU, which threatens the sovereignty of their beloved nation state. In addition to that, we of course also seeing all kings of national liberation movement within the accepted nation states, which just goes to show how arbitrary the concept of a nation is.

But of course, nation states are a big problem in and of itself. When Europe only consisted of nation states, these states all insisted of putting up trade barriers between them. Even, worse, very often they saw each other as threats and fought wars all the time. These type of politics were very destructive for the well being of Europeans.

However, what was the problem? The problem was states. Ordinary people have better things to do than trying to stop each other from making trade deals or killing other people, who they have never met, in foreign countries. It is states who organise and facilitate these crimes. So it does make perfect sense to try to do something against these nation states.

Enter the EU. The EU tries to solve the nation state problem by putting an even bigger state on top of all the nation states. That way, so the idea goes, this more powerful big brother state can stop the nation states from committing crimes.

This seems to work to some degree. We have not seen any war between the members of the EU. And trade barriers, including migration barriers have fallen. However, the fundamental problem with the EU is that it is itself a state. And if states are the problem, then how is a bigger state going to solve it? It seems we are just trading one problem for others.

We have some precedents for what the EU is trying to do. Take Germany for example. Germany once was split up into dozens of small, independent states. And it had the same problems as Europe. These states were putting trade barriers up and fought wars against each other. Finally, Prussia, one of the two big kingdoms (the other being Austria) united all the small states into one big state.

And sure enough, there were no trade barriers within Germany anymore and the different ex-states, have not fought wars against each other ever since. But that is not to say that Germany did have free trade with the world and ended every kind of military engagement. The opposite is true. The destruction caused by this new state just got bigger. It got involved, and was arguably responsible, for two world wars and massacred millions of its own citizens. Yes, little German statism had its problems. But uniting Germany into one big state, in hindsight, looks like the worst possible solution for it. In fact, it was no solution at all. And yet, strangely, although everyone seems to agree that the history of a unified Germany is very problematic, few people would even suggest that the solution was faulty. The belief in the alternative of ever bigger statist solutions seems unlimited.

The US is another bad example. It first had a constitution, the articles of confederation, that did not have a central government above the individual states. But they quickly had a counter revolution that succeeded in installing a central government. And now we have a gigantic state that is running the biggest empire in human history. It is bullying everyone on the planet to bow to their demands. And no, it is not a good deal for its own citizens either. They are tax slaves even if they physically leave the country. And they have a very hard time to escape the law, if the US wants them. We just saw this with Edward Snowden, whose only possible refuge was Russia of all places. That is because the US Empire is big enough to enforce their laws and regulations, no matter how bad or silly, far beyond its borders. And lately, it even started to charge people huge exit fees in case their dare to say no to its citizenship.

The EU is on its best way to become like the US. If we know one thing about states, it is that they grow and grow and grow. Short of a revolution, nothing seems to be able to stop them from doing just that. We already have a European police that makes it hard to hide from the legislature of the individual states, no matter how unlibertarian it is. If the EU continues, we will soon see the establishment of a European army. This will be the beginning of another european imperialism, only this time American style. And of course sooner or later they will have a centralised tax policy that prevents the currently existing tax competition.

Many people will say, well this cannot happen. Every single member state would need to agree on this and there will always be someone in opposition. Yes, sure, there are some barriers. But, again, states always grow. They eventually overcome these barriers. The problem is, they can try as often as they want, they only have to succeed once. They may fail 20 times. But then the 21st time, there will be a special historic situation in which suddenly everyone does agree. At that point a new government department will be established. And of course, once established, it will be impossible to get rid of.

The Euro is a good example of this. Just like the EU, most criticisms of the Euro seem to be ill informed. No, you do not need a common fiscal policy to use the same currency. No, it is not the fault of the Euro that people in many Euro states are voting for socialists that are expending the welfare state to unaffordable levels. And no, these countries are not better off leaving the Euro and inflating their way out of it. Inflation has never made any economy richer.

Just like nation statism in general, monetary nationalism is a big problem. It makes trading across state borders more expensive and risky. And it gives the control over a currency to a single government, that can then use it politically without any opposition. Compared to national currencies, the Euro looks a lot better. It reduces the cost of trading within the Euro zone significantly. And it makes it difficult to instrumentalise the currency for political purposes.

Difficult, but not impossible, as we are seeing at the moment. Yes, for a while it looked like the Euro was working well. States that got into trouble had to cut spending and deflate their economies. That is because there was a lot of opposition to money printing. But eventually, this opposition was overcome. Now, the ECB is engaging in huge money printing programs and has set its interest rates below zero. But since the Euro is now covering a much bigger area than the national currencies, the damage being caused by this money printing is much bigger. In other words, as bad as national monetarism is, the Euro has now proven to be the wrong solution.

One interesting aspect about the fall of the Euro is that the Euro had a no bailout clause as a core part of its design. This clause was suppose to prevent the Euro to be used as a tool to bailout bankrupt states within the Euro zone. Had this clause been observed, the Euro would still be a pretty good currency. But it was not. The interesting thing about this is, that the clause was actually never repealed. Technically it is still the law in the Euro zone.

This is a phenomenon that we see over and over again with states. If there is a law in the books that is supposed to stop the state from growing, this law is simply ignored when it becomes inconvenient and cannot be formally removed. This is so common that markets, from the very beginning bet against the no bailout clause. This bet turned out to be a very lucrative trade. It is simply naïve to believe that states can be limited by written laws. It is precisely this observation that made me an anarchist.

So what is the right solution? The answer is, we need to get the government out of money. In other words, letting the market choose its own currency. However, political solutions like the Euro actually make this real solution more difficult. Because the real solutions will have to compete with the political ones. And the political ones have a lot more physical force on their side.

And that is true for the EU as a whole. Other then the official leave campaign suggests, the problem with the EU is not that it is undemocratic. It actually looks more democratic than the UK. But democracy in general simply does not work. Westminster will listen just as little to ‘the people’ than Brussels will. And it is just as capable passing tons of regulations. So to give Westminster more power is something completely different for demanding self determination.

Brussels simply has a PR problem. That arguably, actually makes it a more attractive government than Westminster from a libertarian point. A government that is seen as legitimate is much more dangerous than an illegitimate one, as people are more likely to obey its command. In other words, Westminster can probably get away with a lot more tyranny than Brussels can at the moment.

But, we really need to get rid of both, Westminster and Brussels. The way I see it is, if we get rid of Brussels we have one down, one to go. The real solution to the nationalism problem is global markets. But the EU is actually not helpful for that goal. First of all, since Brussels is loathed, it gives the national parliaments a much higher legitimacy. The governments of the nation states increasingly discover that they can just blame all problems on that other government in Brussels. So it is actually backfiring in the fight against nationalism.

But more importantly, nation states are not capable to deal with a globalised world. Today, more than ever, people and companies vote with their feed if they dislike the politics of a state. The more states exist, the more they are competing for productive people. And the more they are competing the less power they can actually exercise. The market can play divide and conquer with them.

Of course, there is a great need for international rules. If we destroy the state solutions for providing these rules, the market will come up with private ones. If on the other hand, politics provides them, the market for these products will be damaged or even destroyed.

That is not to say that we should oppose treaties that break down trade barriers. Ever treaty that fuels the competition between states should be welcome. But these treaties should not come from international governments like the EU. As soon as we establish institutions like the EU, whose purpose is to regulate, then that is what they are going to do, whether it is useful or not. Single treaties can be accepted or rejected one at a time. And there is no international political body that immediately goes to the next regulation once it has signed the last one. I cannot see, why there could not be a treaty like Schengen, which gets rid of all these, highly destructive, border controls, without having an international government.

We will need to crush the nation state eventually. But we have to do it with the means of the free market and not of politics. If we use ever bigger states as the solution, we will solve one problem and get 10 new ones in return. The EU, just like a bunch of other international institutions, are the wrong way to do it. We need to get rid of them.

The UK leaving the EU will probably be a big step into that direction. Of course, it will be very disruptive. All the talks about new, favourable deal with the EU after a Brexit are nonsense in my view. The EU is a political and not an economic project. I would be surprised if there is any deal at all. Since when do traitors get good deals? They get hanged publicly, to deter all other potential traitors. The most likely offer will be that the UK can re join the EU as a full member at any time, if it comes to its senses. Until then, out means out. There will be no deal whatsoever.

This will be the most likely outcome, because if the UK got any deal that is at all attractive, a lot of other states will then demand the same. And that would be the end of the EU. Not negotiating with Britain is pretty much the only way they can rescue this political project after a Brexit. And even then, they might no succeed in rescuing it. But to me, the chance of the EU blowing up completely is even more reason to leave. It might be disruptive in the short term, but in the long term, Europeans will most likely be better off.

Christopher Snowdon [@cjsnowdon] Releases the First EU Nanny State Index

Christopher Snowdon of the IEA has released the first EU Nanny State Index and it makes depressing reading for those of us in the UK. According to the analysis, that assesses the tax and regulation of ‘sins’ such as smoking and drinking, the UK is rated 3rd worst — far, far behind places like Germany!!

This is important work by Chris so go check it out and share it far and wide…

nanny_state_index

#Brexit: Can we be Proud of Britain’s History?

British MP Liam Fox said last week in a speech discussing why Britain should leave the EU that Britain had a proud history that it didn’t have to hide from…

Now of course this led many to raise their hands and say, “Wait a minute, what about…” Of course they are quite right British History is very much like a Teenager’s face, pot-marked with blemishes…

One example of those questioning Liam Fox’s view is internet Journalist Mic Wright

I’m not one to claim I’m ‘proud’ of being British. The idea of national pride makes me queasy, being a hop, skip and a jump away from the more virulent idea of nationalism. If you come from the position that we are one humanity, the notion of throwing blanket support over one nation is difficult.

That said, my great-grandfathers fought in the First and Second World Wars, my grandfather was in the Royal Navy (national service) and my parents are both Royal Navy veterans. My dad in particular served in the Falklands War, a conflict I believe was entirely necessary. Some hippy notion of a borderless world is also impossible for me to countenance.

The problem with banging the drum for Britain’s historical role during the 20th Century is that it’s only a sustainable position if you’re white and prone to selective hearing and vision.

Britain was a colonial power well into the middle of the 20th century, it pioneered the use of concentration camps during the Boer War, had the RAF firebomb Dresden, withdrew from Palestine knowing war was inevitable between the Jews and Palestinians, saw its soldiers shoot civilians during Bloody Sunday and had its fingerprints on any number of dark deeds during covert wars. And that’s far from a complete list.

For me, as a graduate of History, this is an interesting topic and an interesting question. Can or should we be proud of British History or Britain itself?

This I believe is a matter of perspective. It depends, I contend, on how you judge statism. If you believe in the idea of statism, that is you believe there must be a state and that the state can be a force for good then you may judge the British state rather harshly. If you have a specific standard by which all states should behave, then Britain probably fails. I’m not sure what Mic Wright believes on this point — I won’t pretend to guess.

However as a Libertarian, of the minarchist variety, I don’t believe in the idea of the ‘Good State’. Statism is a fundamentally flawed outlook and as a result all states are bad. The only question that really matters is, how bad? All states centralise power and resources to some degree therefore there will always be a level of corruption and violence associated with every state.

The state is though a historical fact. There is no real example of a non-state society and it’s difficult to think what a non-state society might look like. This may change, but it hasn’t happened yet and doesn’t look like it’s going to. If you take this position, like many Libertarians do, you may assume that the aim of freedom lovers is to minimise state power and violence rather than eradicate it. The latter being impossible.

Many throughout history have come to similar conclusions. This explains why ideas like Democracy and the Judiciary have developed, they are tools to minimise the impact of the state, not to make it perfect. Attempts to limit state power were made by both the Founding Fathers and the Roman Republic. Neither the US nor the Roman Republic are or were perfect societies, they both attempted though to minimise state power and violence. For a period of time they were relatively successful and the US system continues to be to some degree. As Obama said…

“Our Founders designed a system that makes it more difficult to bring about change than I would like sometimes.”

Therefore I don’t believe, unlike Mic, that ‘President’ Trump poses a great threat to the American system. I would contend that the Founding Fathers designed their system specifically to cope with demagogues and populists like Trump.

If you tackle British History from an anti-state/anti-statism perspective then Britain doesn’t look so bad. It could be much worse and over the last 500 years under the British variant of statism a lot has been achieved.

Relatively speaking Britain and its Empire aren’t associated with some of the truly awful crimes of History. Yes, The Opium Wars with China, the 1857 Mutiny in India, the Boer War, Bloody Sunday, Iraq and various other incidents were terrible. They certainly are not to be endorsed, repeated nor celebrated.

However fundamentally Britain for several hundred years now has been a relatively decent state. It has in its own hodge-podge way tried to minimise state power and violence. This is reflected best by the fact that we can discuss the quality of our state, question its current policies, its ideological outlook and its history. There are many states, like Saudi Arabia, where this can’t be done right now.

Also like the spotty teenager mentioned above Britain’s history isn’t all bad — it’s not all spots and surly strops…

The British Empire defeated Napoleon, a nasty power hungry little demagogue. It was British Parliamentary Democracy that between 1808 and 1843 ended Slavery within the Empire entirely. It was the British system that allowed both the Suffragettes and later the Gay Rights campaigners to succeed.

The British played a significant part in defeating Nazism and Communism — both truly abhorrent strains of the statist disease. Britain is not associated with any truly horrific acts. It doesn’t have the Nazi death camps or the Communist Gulags. There was no Great Leap Forward.

Unlike the Spanish Empire it didn’t plunder so much silver and gold that it brought its own economy to its knees. It didn’t carry out the Gallic Wars, which Caesar himself believes killed 1 million people.

Britain for centuries has been a relatively peaceful, stable and free country. As a result it is a country that has allowed many new political and philosophical ideas to develop and flourish. Many great thinkers such as Smith, Mill, Hayek, Keynes, Woolf, Orwell and even Karl Marx have lived and worked in Britain. Great debates have flowed between the likes of Paine and Burke, Hayek and Keynes.

In science we gave the world both Newton and Darwin — both highly controversial figures in their day. In medicine John Snow discovered the cause of Cholera and Alexander Fleming gave us penicillin. Britain not only played a crucial role in developing many positive things but also helped spread these things around the globe.

In Britain today we don’t beat Women because they’re caught spending time alone with men. A result of a relatively free country, that over time has done away with a lot of the religious superstition that holds much of the world back. And importantly for a long time we’ve had a diverse and powerful feminist movement.

States are not pretty, cute institutions with clean hands — they’re not like Battersea Dogs Home… They are dirty, often poorly led, incompetent, and history shows they generally commit acts of horrendous terror. Britain though is and has been one of the better states — we’re not Switzerland or Luxembourg — but we’re somewhere near the top and we’ve given a lot to the world — certainly more than Switzerland and Luxembourg…

I’m not sure I’m proud to be British or proud of all its history. I certainly can’t lay claim to any of the achievements nor am I responsible for any of the crimes or failings.

I am though very glad to be British. I’m glad I was lucky to be born in a relatively free, wealthy, stable and pleasant country. This is a result of our history — as Newton sort of said, “We stand on the shoulders of giants…” And overall there is no doubt in my mind if the world were a bit more like Britain it would be a better place.

The Common Agricultural Policy – a costly protectionist racket

‘The Common Agricultural Policy forces consumers to pay ‘two or three times more for food than we would pay without the policy’
Dalia Grybauskaite, EU budget commissioner 
The way to build lasting economic growth [in Africa] is for Europe to end the CAP
-Sir Digby Jones, former Chairman, CBI.

The Common Agricultural Policy is an EU-wide system of agricultural subsidies. It is a form of protectionism that represents the worst of European Union parochialism. It is designed to “defend” the European agricultural industry from cheaper products from outside producers. The EU spends between £45-50 billion per year (£49 billion in 2013) on this system which is approximately 43% of the total EU budget. The subsidies are combined with protectionist measures such as import tariffs and strict quotas on certain agricultural products from outside the EU. This has made European food prices some of the highest in the world and is seriously detrimental to foreign farmers.

The CAP subsidies have often caused overproduction, which has led to food being destroyed, or sold at below market prices through export subsidies or being stored thereby creating the, now infamous, “food mountains”. The subsidies exports are flooded into third world countries, especially Africa. By undercutting local farmers, who cannot compete with the low priced subsidised imports, the policy is distorting the market and impoverishing people. With growth and development being absolutely essential to the long term prospects of third world countries,the CAP is seriously harmful their underdeveloped economies. The subsidies prevent them from exporting agricultural produce to the EU on a level playing field, creating inflated food prices for us, and economic stagnation for them.

History

During negotiations on the creation of the “Common Market”, France used its influence as the second major power of the EU to lobby heavily for subsidies for its farmers which have stood ever since. This privilege was her price for agreeing to free trade in industrial goods and one of the many benefits France enjoys for its status as the secondary power behind the project. The CAP was created in 1957 under the Treaty of Rome and was implemented from 1962.

It aimed to increase productivity and to protect agriculture throughout the EU by controlling prices and levels of production, and to protect the countryside by subsiding the rural lifestyle. It has in-fact had the effect of protecting big agricultural businesses and enriching hereditary landowners while also damaging the rural environment. The subsidies led to big agri-businesses growing ever larger and stifling smaller producers. The CAP, by guaranteeing prices, encourages producers to use every bit of available land. Inevitably, they have altered the rural landscape with intensive farming. Every furrow is valuable thus efforts are made to use every bit of available space.

A landscape which had been unchanged for centuries and was famously pleasant and aesthetically pleasing is now less diverse. Ancient hedgerows have been torn up, swathes of land are blighted by industrialised prairies and polluted with high levels of chemicals and pesticides (leading to water pollution and soil degradation). The natural habitat of wildlife have been disrupted or destroyed, leading to widespread declines in the populations of many farmland bird species and other wildlife.

By the 1990’s the process of reform began in attempt to curb the amount of waste and address environmental concerns. By 2013, after the first full review since the policies inception, a number of reforms were been approved to be implemented in the period 2015-2020. They represent an attempt to move towards sustainable agriculture and prevent overproduction and include policies intended to preserve the environment and encourage new entrants into the industry. The reforms, while welcome, were a long time coming but have done nothing to address the fundamental problems with the policy. Further, far reaching reforms, of the kind sought by Britain for decades, are unlikely to happen because France and her allies benefit disproportionately from the subsidies and will not allow changes to that threaten the status quo.

Costly protectionism

Britain should strive to be an open, free-trading nation with a global outlook. The CAP is the very antithesis of free trade; it is protectionist central planning and economic isolationism. The cost of food has been steadily declining for decades but the great recession has created a cost of living crisis in Britain and across Europe, food prices have risen and the CAP exacerbates this, costing hard pushed consumers. The price inflation can be seen by comparing wholesale food prices in Europe to world market prices, this shows that we are paying 17% more for food than we would under market conditions.

Central planning and market intervention always creates distortions and unintended consequences. The worst of all the damage caused by the CAP is the way it punishes consumers, especially the poor. The Common Agricultural Policy should be abolished; this would represent a drastic measure to address the cost of living crisis, cutting food bills for all European citizens and bringing relief to impoverished households across the continent.

Advocates of the CAP will protest but for the way forward we need only look to New Zealand. Farmers there had enjoyed generous taxpayer funding and were disconcerted at the thought of losing out but in 1984 when the government was faced with a budget crisis it decided to repeal all subsidies. Did the predictions of disaster and an end to small family farms come true? No, since then the agricultural sector has thrived!

Much like in Europe subsidised farmers in New Zealand had become dependent on government aid and were, in-effect, farming in such a way as to meet targets to make them eligible for subsidies.  This was detrimental to productivity and innovation. When all subsidies were removed farmers in New Zealand proved to be entrepreneurial, innovative and adaptable.  Now, instead of trying to maximise the amount of government aid received, agricultural practices are now motivated by the demands of consumers and farmers are focussed on good business practice. it is as simple as growing things that consumers want to eat. Productivity is up, efficiency and innovation has increased and the industry is thriving without taxpayer hand outs.

Abolish the Common Agricultural Policy and Europe could have a dynamic, diverse, prosperous and growing rural economy too, and we would all be saving money on our food bills.