Friday, 13 May 2016

George Washington: the first and greatest Brexiteer

I always feel uneasy when someone here in Brussels – usually one of the ‘Europe is my country” types – insists on drawing parallels between the development of the United States and the development of the EU. There are no parallels. The idea that the two are in any way the same kind of creature is grotesque.

The Framers of the US Constitution perfected the British constitution for a federal republic. They established a federal government of strictly defined and highly limited powers, with the states and their people retaining their individual sovereignty.

The European Project was from the first a project to construct by stealth a supranational power to destroy the sovereignty of the member states, under a government the limitation of whose powers would never be defined.

So, no parallels.

There are however things to be learned from the history of the United States. One of them comes today from Brian Reading, a veteran economist who has been commentating on global economics since the 1950s. Reading was the first economics editor at the Economist, and he was economic adviser to Ted Heath.

He backs Brexit.

Today Reading has a comment piece on the website of the Official Monetary and Financial Institutions (OMFIF) Forum.

In it, Reading takes apart the ‘facts’ offered by George Osborne and the Treasury report: ‘Osborne’s claim to have presented “rigorous and objective” analysis to reach “robust” conclusions is exaggerated.’

‘The prediction by Mark Carney, the Bank of England governor, of a possible recession if the UK quits is similarly faulty.’

But we know that, it’s been covered. What caught my attention instead was Reading’s conclusion:

‘The Treasury argues, correctly, that “openness” to trade promotes productivity, GDP and income growth.’

‘These are the advantages Adam Smith first described in 1776, the year of the American declaration of independence. The 13 states were fully aware of the consequences for trade and capital flows from Britain. They preferred making their own laws rather than obeying those made in London.’

‘This decision did not impair their long-term prosperity. The colonies rejected British appeasement offers. They faced severe short-term costs, including the Revolutionary war that they won.’

‘No one today would argue that the American states would have been better off remaining UK colonies. In a few years, long after the flawed Treasury report has faded from memory, no one will claim that the UK would have been more prosperous by staying in the EU.’

George Washington: the first, and greatest, Brexiteer.

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