Brexit: No cake, but let’s welcome the prospect of a nice big bit of fudge!

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Along, I’m sure, with many LDV readers, I’ve read hundreds of articles on the subject of Brexit over the last couple of years.

But one piece of writing has finally encapsulated a precise sensible solution to the whole sordid, messy business.

David Shariatmadari is a writer and editor for the Guardian in London. In a post yesterday entitled “On Brexit, the views of the 48% must be respected too. That’s democracy”, he argued that:

Given that the UK is split, it’s only fair if the government delivers ‘Brexit in name only’, as is looking increasingly likely.

After explaining that the Irish impasse will probably lead to the UK “both in a customs union and closely, if not entirely, aligned with the single market”, he concludes:

…the results were 48% for remain and 52% for leave.

This is clearly not an electorate that decisively favours Brexit. It does so only very tentatively. It does not matter if, among the 17.5 million who voted leave, there are many, even a majority, who feel strongly that a clean break from the EU is best. The government serves the whole country, and 16 million people wanted nothing to do with Brexit at all.

The democratic solution to this split is therefore to enact Brexit, but remain closely aligned with the EU. That is the course that most closely reflects “the will of the people”.

It might well mean “Brexit in name only” – a situation that completely satisfies neither side, a classic fudge, stirred in Brussels and left to set in Westminster. But it is a situation that best embodies the results of the vote. It’s a cautionary tale about referendums, for sure. But if there are Brexiteers who finds themselves “frustrated” by it, perhaps they aren’t quite the democrats they claim to be.

This reminds me of the Norwegian way. The Norwegians saw their 1994 EU referendum result, which was – spookily – 52% no and 48% yes – and concluded that the country was split and that, rather than go with the 52% and have nothing to do with the EU, they would find a compromise solution – a fudge if you like – which leaves Norway in the Single Market but not in the EU. It’s way of trying to find a middle line or consensus.

So, we’re not going to have our cake and eat it, it seems, but we may end up with a nice bit of fudge instead. The British/Irish are very good at fudges. I say let us welcome and relish the prospect of a nice big fudge!

I have to say that Mr Shariatmander’s article is the most sensible thing I have seen written about Brexit and I have set up a regular donation to support the Guardian on the strength of it.

You can read the full article here.

* Paul Walter is a Liberal Democrat activist. He is one of the Liberal Democrat Voice team. He blogs at Liberal Burblings.

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50 Comments

  • Richard Underhill 21st Apr '18 - 3:36pm

    The referendum in 2016 offered a way of saying NO to David Cameron without installing anyone else in his position. Several Labour MPs asked at PMQ whether he would resign in the event of a NO vote. At the time he denied intending to do so, but he went down with his ship, taking us all with it.

  • Regarding the Irish border, I recommend watching the mockumentary “Soft Border Patrol” on BBC iPlayer.

  • Breaking news. Lib Dems back percentage democracy, as you admit an outcome that satisfies no-one.

  • Richard Underhill 21st Apr ’18 – 3:36pm…

    As for David Cameron going down with his ship; that act requires staying at one’s post. He took the ship’s lifeboat leaving us behind with a first mate, one Boris Johnson, who decided that he didn’t want the job. The crew fought amongst themselves and finally settled on a vicar’s daughter who had already shown the ‘Hyde’ tendencies beloved by the party…
    We, the passengers, have been assured of easy sailing, welcoming foreign ports and friendly natives willing to give us everything for a few beads…

    The reality of stormy weather, reefs and hungry cannibals is finally filtering through…

  • William Fowler 22nd Apr '18 - 7:50am

    “One of the great things about the EU is that we have representative democracy at that level. If we just have the economic elements in some sort of pale “compromise”, we miss out on the benefits of all that.”
    Hilarious, we have a lot of has-been politicians on the Brussels gravy-train passing endless, mostly pointless, laws although to be fair the EU ship has been concentrating on consumer rights and taxing business in the past couple of years so may be we should replace have with had.
    I have been looking at population figures, at the end of the Thatcher era UK pop was 57.5 million (up approx a million from the beginning of that era) and it is currently 66.5 million (possibly a lot more as the Home Office is useless) which explains the creaking infrastructure (even after Labour almost bankrupt the country upgrading it), overloaded public services and dreadful transport options. Revenues from extra taxes have been eaten up by welfare and 12 million pensioners rather than gone on public services/housing…
    This is the context in which 52 percent voted for Brexit, blaming the EU for immigration and various problems caused by endlessly incompetent UK politicians… any solution has to address these things and staying in the EU in all but name does not do it.

  • John Marriott 22nd Apr '18 - 8:21am

    @William Fowler
    I’m not a fanfastic fan of the EU either; but your gratuitously insulting remarks such as “has-been politicians” and “Brussels gravy train” simply reinforce my view that it was Britannia’s hubris that prevented Cameron getting anything like a sympathetic reception from his EU partners when he came calling.

    As one of those “12 million pensioners”, I don’t particularly take kindly either to your use of the verb “eaten up” either. One might think that you agree with Scrooge, when he said about making a donation to charity, “Are there no prisons? Are there no workhouses?” By the way, what was the percentage of over 65’s, who voted for Brexit? Better not annoy them. You might live to regret it!

  • Arnold Kiel 22nd Apr '18 - 8:30am

    William Fowler,

    the main “burden” on social services is not the result of population numbers, but their demographics. Health- and social care, pensions must grow faster than the overall economy to sustain service-levels. EU immigrants are underrepresented among the recipients of these, but overrepresented among their providers. Their receipt of working-age benefits is not above average and balanced by their economic contribution.

    Only a growing population can, to a degree (and if governed competently), maintain a balance between recipients and providers of social services.

    Likewise, educating a growing pool of children for an increasingly demanding work-environment (as well as housing and transporting them) is the unavoidable cost of remaining a competitive economy. Low-skilled EU-immigration is the “cheaper” solution: it represents a tradeoff between saved childcare-, education-, transport-, and housing-cost and the qualification-levels received.

    The recovery of the UK economy and public finances since 2008 was, in the absence of productivity-gains, almost entirely workforce- (and thereby immigration-) driven. Stagnant living-standards and declining social service levels support the erroneous perception that more could be gained than lost by “controlling” immigration. The opposite will happen.

  • Many migrants have brought over elderly parents and grandparents into the UK. They too require healthcare and pensions. This practice is becoming more and more common. In fact in some towns with heavy EU migration the GP’s surgeries and hospitals are filled with elderly EU migrants who were never economically active in the UK but now demand taxpayer funded healthcare services.
    Is it any wonder the UK voted for Brexit ??

  • Arnold Kiel 22nd Apr '18 - 8:55am

    Paul Walter,

    your support for Mr Shariatmander’s article is understandable, but based on one equally understandable implicit premise: the absence of leadership. I continue to reject both, the premise and the conclusion. In the end, you might be right, but there is still time to fight.

    Apart from being from all angles factually inferior to outright membership, the Norway-fudge has the defect of lacking sustainability. A 90% compliance, 0% vote vasall-status is widely accepted in Norway, but would continue to be vigorously attacked by hardcore Brexiters in the UK.

    A strong and stable leader would not take long to change the country’s mood, but not somebody like Ms May, who never did anything else than follow: first xenophobic undercurrants, then a referendum, and now her party’s radicals. Things can still be turned around, if Parliament provides leadership.

  • Peter Martin 22nd Apr '18 - 9:04am

    @ Arnold Kiel,

    “Only a growing population can, to a degree (and if governed competently), maintain a balance between recipients and providers of social services.”

    The question of population level should be discussed more than it is. However, on a global scale, to apply this argument will lead to environmental disaster. We can’t grow infinitum. I’m sure you’re aware of what happens when you put one grain of wheat on the first square of a chess board, two grains on the second, four grains on the third etc.

    On the one hand, we seem to worry that the ‘rise of the robots’ will create a society which will leave us all short of things to do. There won’t be enough jobs to go around so we give everyone a UBI to ensure they don’t starve. On the other hand, we worry that we have to have an ever growing economy, and an ever growing population to ‘pay for’, in the future, what we managed quite well to pay for previously with a smaller economy and smaller population.

    Neither of these views are correct. There’s nothing wrong with increasing automation. That will free up people to do other things that we think we now think we ‘can’t afford’. ‘Can’t afford’ on a macro scale is quite a meaningless concept. We either have the resources, including human resources, to do things or we don’t.

    So, sure, if we think we need more human resources we should think of encouraging more people to live here. But, that means there will be a need to provide more resources for them too. They’ll need houses, schools and hospitals etc etc.

  • Arnold Kiel 22nd Apr '18 - 9:07am

    LibDemer,

    I am convinced you are wrong, and that only a minor fraction of elderly dependents are coming to the expensive UK. If they did, they would receive their home-country pensions. Could you quantify “Many”, “more and more”, and “filled with”?

  • Lib Demer
    “In fact in some towns with heavy EU migration the GP’s surgeries and hospitals are filled with elderly EU migrants who were never economically active in the………”
    Perhaps you really meant Spain, full of elderly UK pensioners never active in the Spanish economy, etc.

  • Peter Martin 22nd Apr '18 - 9:51am

    Fudging the issue doesn’t sound to be a great idea. We should negotiate the best deal we can. If that means trading on WTO with the EU for a time then that’s what we need to do. The EU will soon come around when German car manufactures get slugged with a 10% tariff on their exports to the UK.

    The “markets” don’t seem anyway near as worried about the future as most Remainers/Lib Dems. The Government can “borrow” money on ten year gilts at an interest rate of approx 1.5%. Why would anyone want to lend us money at such a low rate if the outlook was as gloomy as many fear?

    The pound is trading at $1.40. That’s up about 20c from last year! Again that not a sign of an economy that’s about to “go over the cliff” any time soon.

  • Philip Knowles 22nd Apr '18 - 10:21am

    Peter Martin
    Do you really think that sales of BMWs, Audis, VWs and Mercedes will be affected by a 10% tariff? Of course not because people WANT to buy them.
    However, sales of Nissans, Toyotas, Hondas and Vauxhalls will be affected by the tariffs into the EU. Nissan have just announced job losses because ofbthe slump in Diesel sales. Remember that they are owned by Renault, Vauxhall are owned by Peugeot, MINI is owned by BMW.
    How long will it be before the European owners close the UK factories and move them to the EU? Every new vehicle type that Nissan produce goes through a factory bidding process. They have a factory in Spain. Washington may be the most productive factory in Europe but could it get past a 10% handicap?
    We are in deep trouble here and dogma is winning over commonsense. Jacob Rees-Mogg doesn’t care how many manufacturing jobs go as long as he gets his way.
    It was said that a lot of people voted Leave to give the politicians a kicking. When the chickens come home to roost and the poor get even poorer democracy could be in serious trouble and would be a ripe breeding ground for the similar groupings that afflicted Germany in the 30s. Those broken promises for the NHS are just the start and everyone will be falling over themselves to say it.s not our fault.

  • Peter Martin,

    1. “WTO with the EU for a time” would irreversibly destroy UK manufacturing
    2. You will have to drive some imported car. It will simply cost you more (it already does in GBP); not a problem for the manufacturer.
    3. UK gilts are a miniscule fraction of global fixed-income markets, and mostly held by Britons. They will be taxed for redeeming them, if needed.
    4. The FX story of the last year is $-weakness, not GBP-strength. GBP/eur, much more relevant for the UK’s trade mix, is rather constantly 15% below pre-referendum levels.

  • Peter Martin 22nd Apr '18 - 5:13pm

    @ Philip Knowles,

    You ask: ” Do you really think that sales of BMWs, Audis, VWs and Mercedes will be affected by a 10% tariff?”

    Yep. Otherwise they’d be charging 10% more than they do already. Just like you’d be pricing your labour at 10% more if you could. Or just like you’d be selling your car or your house for 10% more if you had a buyer at a higher price. That’s the way things work.

    @ Arnold Kiel,

    The pound is down approx 12% against the euro as compared to the 1.30 mark just before the EUref. As our EU trade is heavily in deficit that’s a welcome adjustment. Most of our trade is not with the EU and that sector is growing. Our trade with the EU is declining. The EU hasn’t done much for the UK manufacturing sector in recent decades. Admittedly that hasn’t been all the EU’s doing. We could perhaps have joined the ranks of the EU currency manipulators to ensure that our trade was closer in balance.

    But we’ve let our currency float. If it rises then we find it more advantageous to buy at cheaper prices from overseas and our export industry suffers. The resultant current account trade deficit is only possible if it is balanced by a capital account surplus and that has to involve overseas buyers acquiring gilts. If they didn’t buy them the pound would sink.

    It’s not just cars. The German surplus to the UK is over 50 bn euros p.a. Where is Germany going to find another trading partner that will accept such a huge imbalance? German exports to the UK are more than twice imports from the UK. You’re not going to make that up in the USA. President Trump is quite right that Germany is a currency manipulator.

    The first rule of business is to look after your customers. Let’s see who blinks first.

  • Peter Martin 22nd Apr '18 - 6:06pm

    @ Martin,

    I don’t think my Post-Keynesianism would meet with the approval of the good Professor. We are for managed markets. There’s no such thing, in any case as an ultra free market. Government can’t help but influence the ‘market’ with its fiscal policy.

    If President Trump, or anyone else, was reliably wrong about everything, they’d be very useful individuals. We’d simply do the opposite of everything they said. President Trump is right on Germany as a currency manipulator even though he may well be wrong about almost everything else.

  • Philip Knowles 22nd Apr '18 - 7:50pm

    @Peter Martin
    You’re right and you’re wrong. The market price for the executive cars is as it is now because if one of them raised their prices they would lose market share. But a tariff would apply to them all. The other manufacturers (Jaguar and Lexus) would almost certainy take the opportunity to raise their prices.
    The UK manufacturers exporting to the EU wouldn’t so easily be able to either cut their prices or cope with the price increase threatening the future of those plants (and their UK supply chain).
    The argument that Germany would struggle to replace the UK market is interesting because the likes of Liam Fox and Jacob Rees-Mogg say WE will easily replace the EU market.

  • Peter Martin 22nd Apr '18 - 8:43pm

    @ Martin,

    My degrees are in Physics and Electronics so no formal credentials in Economics I’m afraid. That may change in the next couple of years if I can make some time. My approach has been to try to understand the economy as flows of money in the same way as I would flows of electrons in Electronics or flows of fluid in a hydraulic system. That’s not a bad approach.

    There are economists who were already doing it this way. If you want formal qualifications, I’d recommend people like Steve Keen (see for example on link below), Bill Mitchell (the Aussie one), Stephanie Kelton, Randall Wray. They all make perfect sense. To me at any rate.

    https://www.dailyreckoning.co.uk/economy/professor-steve-keen-on-the-problem-with-europe/

  • Arnold Kiel 22nd Apr '18 - 9:27pm

    Peter Martin,

    “The EU hasn’t done much for the UK manufacturing sector in recent decades.” Well, look at ownership, output destination, management- and R&D-provenance, component-sourcing, product standard formulation, bridgehead-logic… and think again.

    Single market membership matters with respect to the UK’s manufacturing output and financial services where EU-business is dominant. Under WTO-terms, the UK consumer would quickly lose the locally-made option, and simply pay the tariff on top (+ additional GBP-depreciation – some importer-discounting to support volumes). Germany or whoever would lose some volume in line with the UK wealth-decline and the price-elasticity of demand for the respective category, compensated by markets that now enjoy the jobs the UK exported in the process.

    Mr. Trump is always wrong about everything. The president of the ECB is an Italian named Draghi, and commonly understood to support the solvency of Southern Europe with his policies, frequently against German opposition.

    Premium producers cater to consumers that are able to look after themselves (ideally including prudent voting in manipulative referendums).

  • William Fowler 23rd Apr '18 - 7:32am

    “The pound is trading at $1.40. That’s up about 20c from last year! Again that not a sign of an economy that’s about to “go over the cliff” any time soon.”
    Down from a high of 2.4 when Gordon Brown almost bankrupted the country and probably going all the way down to 0.7 if Labour get a chance to turn us into a Marxist paradise and Trump does not crash the USA (always possible so actually almost impossible to predict but I suspect the Euro will emerge as the stronger currency due to German economic diligence and much lower overall debt levels in the eurozone).

    Free Trade UK may work out better than being in the EU, economically for the country as a whole but not for those from poor backgrounds with little prospects who will either end up mired in levels of debt or rough sleeping, nor for those who want to complain about the antics of the State or large companies.

    Leaving the EU is actually a power grab by Labour and Tory politicians from individuals, which is why I am a remainer, actually. Perhaps Sir Vince could start saying that!

  • Peter Martin 23rd Apr '18 - 9:05am

    @ William Fowler

    A couple of points of information:

    1) The all-time low in the pound’s value was in 1985 at $1.08. If you care to check, you’ll find that a one Margaret Thatcher had been PM for around 6 years at the time.

    2) It was about $1.65 when Gordon Brown started as Chancellor. That had risen to just over $2.00 by 2008. That was too high, IMO, and led to a loss of export competitiveness in UK industry.

  • Peter Martin 23rd Apr '18 - 9:32am

    @ Arnold Kiel,

    “Under WTO-terms, the UK consumer would quickly lose the locally-made option”

    And your justification for saying this is………?

    I’d prefer a sensible free trade agreement with the EU so that trade can carry on pretty much as it is, but if the EU don’t want to go for that we could end up on WTO terms. International trade is more like barter than many realise. We swap stuff we make and services we provide for stuff that others make and services they provide.

    We can only import if we export. That doesn’t mean that imports have to equal exports. They clearly don’t in the real world and we can expect an imbalance of something like 5% of so of GDP – depending on what capital inflows there are into the country. It’s the capital inflows that balance up any deficit in the current account. So no capital inflows means no deficit.

    The experience of South Africa under sanctions gives us some insight as to what could happen under the worst possible outcome. Then there wasn’t even a WTO fall-back. The locally produced option for South African consumers was often the only option.

    Of course this wasn’t ideal and it took some time to adjust. Many South Africans believe, however, that sanctions imposed on South Africa actually benefitted their economy.

    Brexit isn’t going to lead to economic sanctions. At least I hope not! So we’ll survive perfectly well.

  • Life is full of fudges or compromises if you prefer that term. What the referendum told us is that the nation is divided over the EU. An outcome referendum on whatever deal is reached is still the best way of trying to re-unite the country and gain some legitimacy for the final destination. It must be inclusive and include 16 – 18 year olds, all who have lived here continuously for over 2 years and those who live abroad and retain British citizenship.

  • An outcome referendum on whatever deal is reached is still the best way of trying to re-unite the country

    I really can’t see how re-fighting an incredibly divisive and polarising battle, re-opening all the old wounds and adding some new ones, could possibly help re-unite the country!

    I mean, one side will lose, right? And probably lose narrowly, like last time. Can you imagine the Remainers, having been defeated a second time, just quietly deciding they were wrong and to get behind Brexit now? I can’t. Or on the other side, can you imagine Leavers, having had victory snatched from them by a procedural trick to overturn the result by giving people a second chance to vote a la the Irish referendums, deciding to accept the result rather than immediately start agitating for another, ‘best of three’ referendum?

    I don’t know how to re-unite the country, if it’s even possible, but I really can’t see how re-running the thing which broke it apart in the first place could possibly do anything but make the divisions worse.

  • but if the EU don’t want to go for that we could end up on WTO terms. :))))

    Suggest you listen to BBC R4 In Business “The Global Trade Referee” (available on iPlayer Radio).

  • @CJ – On migration can I please point you to this article.
    Version that doesn’t require registration to read: https://www.socialeurope.eu/inconvenient-truths-migration

  • Arnold Kiel 23rd Apr '18 - 6:14pm

    Dav,

    Britain is, always was, and always will be divided. This was only overlooked at times when “everybody knew his place”, and later, when, for a while, it seemed as if everybody was participating in growing prosperity. Neither condition will recur. The most impressive trick of the entire Brexit drama/comedy (whichever you prefer) was to make Britons believe that this division has anything to do with Europe, or could be resolved by remaining or leaving the EU. Nothing could be further from the truth.

    The real war is between rich and poor, and the Torys (=the rich) prolonged their grip on power by deflecting Briton’s anger about them on Europe.

    The Rees-Mogg- or Fox- kind of “clean” Brexit will result in final victory of the rich. The UK will dissolve in a global capitalist power play where only the best and the brightest can compete, and where any attempt at Corbinist redistribution or re-nationalization will fail at arresting the vagabonding and elusive capital they wish to share with the many.

    The EU is the only global force against this trend, but also without guarantee of success.

  • Peter Martin 23rd Apr '18 - 8:13pm

    @ Arnold,

    “Britain is, always was, and always will be divided.” & ” The real war is between rich and poor”

    I’m slightly surprised at you pedalling this “class war” stuff. We can look at the Socialist Worker if we want that. Even with my leftist sympathies I’d be hesistant to put it in such stark terms. The modern world isn’t quite so clear cut. I think we’re all moving towards a more US style politics where the wealthy are often much more progressive in their viewpoint than many other groups in society. The more enlightened realise that wealth always does need to be shared out more equitably.

    Most people don’t want absolute equality but they do want a fairer society where life chances aren’t defined by an accident of birth.

    My natural political grouping isn’t doing at all well in the EU. The left-of-centre parties are shaping up lamentably and the working classes are deserting them. There’s not much sign of a class war there. They need to stand up to the EU imposed economic austerity programs which are imposed on them. Goodness knows why they are so useless. They’ll take from the EU what they’d never accept from National Governments – simply because to be anti the EU is seen as being on the populist right.

    Consequently, the populist right are gaining ground everywhere. That’s something we’ve avoided in the UK but only thanks to Brexit. If Brexit is somehow thwarted they (UKIP and groups even further to the right) will be back with a vengeance.

  • Roland. Apologies but registration is simple and the site is an excellent resource. Please give it a go, the article (and others) are very good.

  • Roland. And it’s free.

  • @Arnold – The Rees-Mogg- or Fox- kind of “clean” Brexit will result in final victory of the rich. The UK will dissolve in a global capitalist power play where only the best and the brightest can compete
    If the ‘rich’ are victorious and the UK dissolves in a global capitalist power play, the best and brightest won’t necessarily be the best and brightest at making Britain great again.
    British history provides plenty of evidence of just how dim and daft the rich and powerful can be – we only really won two world wars because a few people, in positions of power, were wise enough to not play cricket…

  • @CJ – I’m sure the site is an excellent resource, however, I, like others, object to being blindly referred to an article that requires registration etc. before I am able to read it.
    By simply warning people that following the link will require registration/paywall, means I treat your comment more of a contribution to the discussion than a potential distraction from it. I totally accept that my viewpoint has been conditioned through many years of Internet forum usage and cleaning up machines after mistakenly clicking on innocent looking links or email attachments…

  • @CJ – cont. Also in this particular case, having read the article (version I linked to), I felt that what was being said was sufficiently important and relevant for others to read and hence removing the small hurdle of registration was worthwhile if it got others to read it.

    Personally, I much prefer websites that allow you to see one or two articles completely and then pull down the access shutters. That way I can introduce people to them, they can get a taster before deciding whether they want to register.

  • Arnold Kiel 24th Apr '18 - 9:07am

    Peter Martin,

    “…US style politics where the wealthy are often much more progressive in their viewpoint than many other groups in society. The more enlightened realise that wealth always does need to be shared out more equitably”? I am surprised their propaganda even worked with you. Ever looked at the results?

    From this misjudgement, you, predictably but unelegantly, arrive at “EU imposed economic austerity programs”. Well, bankrupting the EU would be one way to kill it. So far, unlike the US, it does provide universal healthcare, unemployment insurance, and pensions. Not perfectly, but within its means. Greek, Portugese, Spanish, and Eastern European citizens, btw. received a lot more from the EU (or the guaranteeing North, to be precise) than their national Governments could independently fund.

    Another success of Brexiters and like-minded populists: convincing most poor that their plight is cultural, not economic, and the enemy are foreigners, not the rich. A race-struggle is much cheaper than a class-struggle.

    Do you really believe Briton’s underprivileged will become les numerous and/or happier if Brexit happens?

    Roland,

    the best and brightest, or better (but mostly identical) the rich and powerful have many failings, except one: maintaining and enhancing their riches and their power.

  • Peter Martin 24th Apr '18 - 9:28am

    @ Arnold,

    The EU has only existed since 1993. Since that time direction of travel of ‘Europe’ has been well and truly in a rightward direction. ‘Social Europe’, such as it is, was the creation of largely independent Nation states, not the EU, and reached its peak no later than the mid 80’s. It’s been in retreat ever since.

    The USA does have its faults. We all agree on that. But on economic matters the Americans do, in the main, understand, unlike most Germans, (including yourself), that they can never go bankrupt. They can issue as many dollars as they like to settle their accounts with inflation as the only constraint. It’s the pfennig -pinching ‘Swabian Hausfrau’ mentality of German economists and politicians which is killing the EU. Thomas Piketty refers to ‘conservative’ politicians, but the SPD are little better.

    https://www.independent.co.uk/news/world/europe/german-conservatives-are-destroying-europe-with-austerity-says-economist-thomas-piketty-10368040.html

  • Katharine Pindar 24th Apr '18 - 10:32am

    Good point, Martin. Peter, your case isn’t helped by linking with an old viewpoint – Piketty in July 2015. I think your dismissive view of the EU, that living, growing organism, is out of date.

  • Peter Martin 24th Apr '18 - 10:34am

    @ Martin,

    Can I suggest that you look up some dates? The first requirement for a EU-ophile should at least be to have a good general knowledge of its history. You might want to start with a Wiki. That’s usually a good place to start.

    “The European Union was formally established when the Maastricht Treaty—whose main architects were Helmut Kohl and François Mitterrand—came into force on 1 November 1993”

    It wasn’t just a change of name from the previous E.E.C. or E.C. The Maastricht Treaty changed the nature of ‘Europe’ substantially. The Lisbon Treaty went on to compound the problem. It went from something that was largely successful to the shambles (Greek defaults, the rise of the far right, Brexit etc) we have now.

    https://en.wikipedia.org/wiki/European_Union

  • Peter Martin 24th Apr '18 - 10:44am

    @ Katharine,

    It would be good if you were right but what’s changed vis a vis Germany and the EU? Three years ago we had a CDU/SPD coalition with Merkel as chancellor. Now we have a new CDU/SPD coalition with ……..

    We have to look across the Atlantic to get anything like an independent view of what’s happening in Europe and it’s largely sceptical. The EU pro euro economists aren’t just challenging what’s widely held to be true economically (the importance to national economies of floating currencies etc) they seem to be challenging the rules of simple arithmetic.

    https://www.forbes.com/sites/miltonezrati/2018/03/06/europes-recurring-financial-crisis-has-not-repeat-not-ended/#1d5465d67e5e

  • Arnold Kiel 24th Apr '18 - 1:27pm

    Peter Martin,

    In my view, the history of the EU started 1946. The nation states indeed built the social systems as long as they could. They cannot anymore. It is also true that the EU did not yet take over the job sufficiently, but no other institution or nation would or could, and Brussels understands what is needed (e.g. an end to MNE-tax dumping). The “rightward direction of travel” (I assume you mean fiscally) was an inevitable response to American and Chinese supremacy in technology and productivity. As a consequence, Europe is catching up, and, hopefully, becomes more assertive in this battle. Your ridiculous “own currency panacea” would not do the trick. Some companies or societies must retain world-class competitiveness, not just playing the devaluation-inflation spiral. Europe also needs the financial muscle to see through downturns, technological upheaval, military conflict, and disciplining rouge members, etc. Therefore, the core needs a AAA rating for the ECB to have any firing power, not just a lose group of little Greeces happily printing (figuratively spoken, I know no ink is needed) and inflating away.

  • Peter Martin 24th Apr '18 - 2:07pm

    @Arnold Kiel,

    The history of the European post-war period started in 1946. Or the year before even. It’s led us to where we are now. Greater and greater integration but just not quite enough to create a stable structure. We need to either go back to what we had prior to Maastricht, which is when the European Union, as we know it now, began. Or the EU needs to press on to a United States of Europe.

    ‘Rightward travel’ doesn’t just mean fiscally. The socialist and social democratic parties are in a lamentable state throughout the EU. They can’t manage to present any kind of credible opposition to neoliberal and ordoliberal forces running it even when its their constitutional duty to do that. It’s debilitating and pathetic. It’s really no wonder that the European working classes are looking elsewhere. The extreme right are on the rise in the EU everywhere. Apart from the UK! I keep forgetting that we are still in the EU.

    I don’t quite agree with everything that Milton Ezrati wrote in the link I gave Katharine but his conclusion is the same as mine. I particularly like:

    “The recipients pretend that they will abide by German conditions, and Berlin, to duck the disruption of a prolonged financial crisis, pretends to believe them. ”

    You must know that this is spot-on! You must also know “that German demands are impossible.” The IMF knows that. The ECB knows that. Everyone else in Europe knows it too. It’s really no way to run a currency union!

  • Katharine Pindar 26th Apr '18 - 12:58am

    Faint but pursuing (:)) I read your new link, Peter, and appreciated in the first place that it was from 2017. But from this amateur’s viewpoint, it seems quite logical that the embattled and beset Greeks should try and protect what little they’ve still got by companies holding on to product regulations and unions their labour laws. Even ‘clinging on to nurse for fear of something worse’? I muse. Anyway, what do you think the German Government or/and the EU Commission could do to ameliorate the position? Should they for instance abandon the Stability and Growth Pact, as I remember Michael BG recommending?

  • Malcolm Todd 26th Apr '18 - 1:39am

    Martin 24th Apr ’18 – 10:18am
    “There is little to discuss with someone who claims “the EU has only existed since 1993”, it is akin to discussing evolution with someone who claims the earth only existed since 5509 BC.”

    Well, no – it’s more like discussing British history with someone who claims the United Kingdom has only existed since 1801. In other words, the claim they are making is perfectly true, but a little misleading.

  • Peter Martin 26th Apr '18 - 8:19am

    @ Malcolm Todd,

    It’s misleading to refer to ‘Europe’ instead of the EU. It’s quite possible to be ‘pro-Europe’ but anti-EU. I often try to make the point that the EU (which did indeed officially start in 1993) isn’t the same as the EEC or even the EC. Most people, including myself (I have to admit), didn’t fully pick up on the significance of the introduction of the Maastricht Treaty of the time. It was just another Treaty and just another change of name. I know now I was quite wrong to think that.

    So it’s also quite rational to be pro the EEC and anti the EU. We all need to tighten up a bit on the terms we use.

    @ Katharine,

    Yes, it is logical for the Greeks to bend the rules to their own advantage. I’m sure all countries do (Germany included) – to an extent. Just when bending them becomes breaking them has to be a matter of opinion.

    Greece as a user of the euro has to at least try to abide by the rules of the SGP. It’s not possible for countries to share a common currency without there being some rules. If the EU becomes one country there won’t be any need for any rules – just like there aren’t in the USA or the UK. The rules are a substitute for a single government.

    There’s an obvious problem with rules. What look to be reasonable rules in one economic era (the European pre GFC period) become quite unworkable when a crisis hits. A single government can react a lot quicker to such a situation than can 19 separate countries who have to agree on any rule changes necessary. In fact, they haven’t agreed any changes, and that’s a major problem, but blind eyes have been turned from time to time.

    I

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