Sunday, 5 June 2016

Should and will Britain vote for Brexit?

Inability to adapt has often spelt extinction and so could it be said that the European Union (EU) faces such a risk, if not fate, by dint of its inflexibility to adapt to pressing, changing circumstances? What began out of the ashes of post-war Europe as an experiment at economic union, with ultimate political union a far-off goal of its founders, but not, evidently, the common man, to save Europe from any more disastrous wars now appears to have foundered on that oldest barrier to political integration -- self interest taking precedence. The economic experiment was a laudable one that has promoted internal growth and arguably helped keep the peace among Europe's club members, though as a customs union it was to the disadvantage of the developing world and EU consumers who pay higher food prices. But the experiment came at a price -- uncontrolled immigration on a hitherto unprecedented scale, an issue that is likely to be decisive on June 23, when Britain votes to stay or leave. An integral part of that immigration issue is the economic issue, the facts of which, in weighing up the pros and cons of immigration, have been prostituted by the most beguiling of effective lies -- deception by omission, to which I shall return.

If ever an election campaign was fought so crassly and deceptively, Britain's EU referendum on stay or leave must surely be it. Both sides have gone over the top in their wild claims but they have guardedly hedged their fear-mongering and alarmism with words like 'could', 'might' and 'likely', with the most favourite choice being Britain's Prime Minister, David Cameron, and his Chancellor of the Exchequer, George Osborne, frequent warnings about "a leap in the dark" if Britain leaves. George Osborne's latest scare is his claim that leaving the EU could add £1,500 a year to the cost of an average mortgage, based on figures that in turn are based on assumptions, and as most of us know economists are past masters at getting their forecasts hopelessly wrong because their assumptions underlying their forecasts proved false. And in any event could not a leap in the dark turn out to be a leap in prosperity? When Drake's ships steered to glory was that not a great leap into the dark which redounded to the whole world's benefit by creating the greatest empire that spawned the industrial revolution and its effusion of inventions and discoveries that changed the world for the better?

To return to the immigration issue, let it not be thought that Britain's past immigration was anything other than of immense value at enriching the national gene pool and subsequent economic progress. The problem is not immigration per se, it is the need to limit the numbers to sensible levels that do not overwhelm the social services and give rise to simmering resentment, and worse down the line, which under current EU rules is not possible. There are already ugly signs developing in Europe over the high numbers entering from war-torn regions and even higher numbers of illegal economic migrants taking advantage of the political refugees' plight. Germany, France, Sweden, Austria and Denmark are lurching to the hard right and that would be tragic if the trend continued to the detriment of recently-arrived immigrants contributing to the economy.

Earlier I said that the economic cost and benefits of immigration were subject to that most beguiling  and effective of lies ---deception by omission, but what did I mean by that? Immigrants generate costs in ways which are not factored into any cost/benefit exercise for public consumption. One good example is the administration of justice, where the legal aid bill is about £2 billion a year. Why is this relevant? The answer is that Muslims account for 1 in 7 of all Britain's jailed population while accounting for only 4.5% of the total population. That is not part of the administration of the justice bill but is nevertheless a huge annual expense. Then there is the cost of running the immigration courts, where there is a backlog of  500,000 cases. The taxpayer picks up 75% of the cost of immigration asylum proceedings. Then there is the well over £100 million a year spent on interpreters to help people who cannot speak English, something that 50 years ago hardly existed. All of these legal-related issues are never included in any cost-benefit analysis of immigration, so it is a clear case of deception by omission, the most plausible of all lies, and something all newspapers wallow in. People cannot make the best decisions if they are not in possession of all the facts.

The expansion of the EU from its original five members to include over 25 members today, with more waiting in the wings, was bound to founder on the very different levels of economic development of its new members and differences over moral/cultural mores. Greece, for example, has been a recidivist debt welcher since ancient classical times and its populace thinks it is their God-given right to evade taxes come what may. This, combined with Greece's notorious corruption and cronyism, was bound to lead to ever-more Government borrowing to pay for what it could not afford to placate the people. The huge sums lent to Greece and other member countries exposes the economics of the madhouse and has seriously threatened the stability of Europe's banking system.

Nobody knows for certain that leaving the EU poses Britain significant economic risks. Fundamentally there is no reason to believe it should if both parties think and act sensibly. The risks are much higher for Europe in the political arena, mainly because politics has been allowed to trump sound economics, and the belated attempts by France to reform its labour laws in the face of fierce, lawless union opposition is stark testimony to this disturbing fact. Politics is like a harlot. The harlot can be beguiling but there is always a bill at the end to pay, and it could be far worse than one thinks.

So should Britain leave the EU and will it happen? For the present it seems the wiser course for Britain is to concentrate more on distant shores, as once did Drake, and leave open the option of a return when EU obduracy over badly-needed reforms has been removed. The chances are the Brexiters will win.