Moral outrage against Trump is distracting people from his incompetence

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Donald Trump has made a whirlwind start to his presidency, acting much as he did on campaign. This has provoked predictable moral outrage from liberals across the globe. This leaves me with foreboding. It will not stop Mr Trump, or the political movement he represents.

As a Briton I feel a sense of deja-vu. It reminds me of 2010 when the Coalition government took power and launched an aggressive austerity programme, cutting many public sector jobs, benefits and grants to NGOs. There was moral outrage on the left. I remember screaming protestors at the Liberal Democrat conferences in Liverpool and Sheffield in the year that followed. The Lib Dems were particular victims: they were nearly wiped out at the subsequent General Election, and are only just starting to recover, thanks to the distraction of Brexit.

But all that fury came to nothing. The beneficiaries of the Lib Dem meltdown were their Conservative coalition partners, who gained a parliamentary majority as a result. This led to redoubled austerity and Brexit. The left's response was then to move into even more extreme outrage, by selecting Jeremy Corbyn as Labour's leader. This has only made the Tories look even more entrenched. For all its outrage the left has lost the argument amongst floating voters.

The left was convinced that the people were behind them in their anger. And, critically, they thought that they did not have to win over conservative floating voters. They dreamt of two things: attracting disillusioned Lib Dem voters; and getting people out to vote who had not voted before. Both strategies failed. Labour did manage to convert large numbers of Lib Dem voters - but in the process they weakened the party so much that many Lib Dem voters switched to the Tories to keep Labour out. And, anyway, since most Lib Dem seats were Conservative facing, weakening the party tended to benefit the Tories. And inasmuch as new voters were found, it was not Labour that benefited. Instead many disaffected voters turned out for the populism of Ukip, and then to vote for Brexit in the 2016 referendum. There is no army of left-wing non-voters waiting to be mobilised.

The hard lesson from this is that in politics passion cannot substitute for savvy. And it is no use just talking to people who agree with you already. That may boost your own feelings of self-confidence, but it will not help persuade the people who need persuading. Interestingly, this is not symmetric. The populist right have succeeded by stoking up anger, and loathing for "liberal elites" - and not attempting to persuade liberals. Such tactics in reverse are ineffective on the left.

I fear liberals in America are making the same mistake with Trump as the left did with the Coalition. Their outrage at Mr Trump's actions is certainly justified. But to Mr Trump's voters, many of them former Democrats, what he is doing must look like a breath of fresh air. A politician fulfilling campaign promises! Urgent action on trade and immigration! That there is a lot of outrage and not a little confusion will not concern them. On campaign Mr Trump was repeatedly outrageous, and that harmed his standing not at all. It doesn't matter if liberals hate him.

And it will be hard for liberals to win the propaganda war.  There will be successes for Trump. Look at how the motor companies are changing their tune about jobs in the US; and NATO countries are talking more about their defence budgets; the economy looks just fine. And failures can readily be blamed on the usual suspects. Likewise some distinctly questionable handling of conflicts of interest will arouse shrugs: people sort of knew that would happen when they voted for him.

The smart people in all this are the mainstream Republicans, who control both houses of Congress. They are keeping their heads down and taking the credit as much as they can. It is by no means clear that Mr Trump will last the course. He is old for a first-term president; he is not grounded in the ups and downs of politics; an implosion of some sort cannot be ruled out. But the Republicans, and especially with Vice President Mike Pence, will be there to pick up the pieces, and create a more sustainable version of the Mr Trump's politics that will lock the liberals out of power.

You can't, and shouldn't, stop people being angry of course. But opposition also needs to do two things. First is to avoid personal attacks, on Mr Trump or his supporters. Jokes about the size of Mr trump's hands, or accusations that those that voted for him were bigots or idiots, need to be toned down and reserved for private conversation. Second, which follows, is that the conversation needs to be about competence rather than morals. The Trump administration (unlike the Coalition, by and large) is astonishingly incompetent at actual policy, as opposed to messaging.  To give this criticism credibility it means acknowledging the government's successes when they occur.

Remember George W Bush. He was the target of a torrent of sneering attacks from liberals - but his power only grew. But when he appeared utterly incompetent in the face of Hurricane Katrina, and then Iraq,that's when his popularity fell off a cliff. And yet his incompetence had been evident for years before that. I have read a similar account of Italy's Silvio Berlusconi. Personal attacks did not harm him; scrutiny of his policies did.

So far, opposition to Mr Trump has failed these tests. The president's executive orders have been badly drafted and are leading to muddle and injustice. But he is able to shrug all this off while liberals indulge in ill-directed anger. While liberals congratulate themselves on the size and noise of their protest marches, Mr Trump's relationship with his base is intact.

What the left lacks is leadership, both here in Britain and in America. A liberal fightback can be successful. Demographics are in their favour. But they must rally around a clear and competent alternative. Alas none is in sight.

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The US Republican company tax reform might be a good idea

I like to see the bright side. With the accession of Donald Trump as US President, alongside the Republicans controlling both houses of Congress, that is hard. Mostly, I simply hope that the process of challenge will make liberals stronger and harder. There is too much complacency in liberal thinking. And there is more cosying up to vested interests than we might like to think.

And among the flood of bad ideas coming out ot the new administration, there may be the odd good one. Reforming company tax might be one of them.

What I am thinking of are the plans proposed by Paul Ryan, the Speaker of the House of Representatives.  Liberals should support it, though alas many won't because of who is proposing it, rather than its merits.  One part of the plan is to cut the rate of company tax to 20%, but reduce the number of deductions. This is an old debate. I am sympathetic to lower marginal rates and fewer deductions, though 20% is aggressive. I do not share the view that company profits should not be taxed, and that the burden of taxation should entirely be on distribution of profit instead.

There's another old idea in the mix too: 100% write off of capital investments in the year the money is spent. Older British accountants like me will remember that we had that system here in the 1980s - called 100% capital allowances. It was the basis of many a tax avoidance scheme, and perhaps tilted the balance too much in favour of investing in plant rather than people. But there is some merit to it.

But the really interesting idea is the so-called "border adjustment". This exempts from tax sales outside the US, and disallows as deductions spending on imports. This can be painted in different ways. To nativists this sounds like encouraging exports and discouraging imports. Alternatively it can be presented as a sort of value-added tax, which is well-established here in Europe. Neither presentation does it justice. It is not VAT, not least because the costs paying people is within its scope. And its effect on corporate incentives can be beneficial to the world economy rather than detrimental. It amounts to a constructive proposal to deal with a major problem: the taxation of transnational businesses.

At the moment companies are taxed by the location of profits, apportioned "fairly" using general accounting principles. This falls foul of manipulation through transfer pricing - what country-level subsidiaries within a transnational business charge each other. Thus when a multinational sells you something in Britain, it may treat as part of its costs the use of intellectual property based in a low tax regime, such as the Netherlands or Luxembourg. National tax authorities have been fighting a losing battle against abuse. The G20 recently adopted some new rules to reduce abuse, but this is sticking plaster to repair a fracture. It is best seen as an attempt by corporate lobbyists to stave off more radical approaches.

One such radical approach to reform corporate tax is unitary taxation. This method means that tax authorities assess a business's global profit, and then allocate it to country based on the location of some combination of sales, employment or property. This is how US states tax the profits of US businesses, mostly allocating them using the Massachusetts formula. I have been advocating this for years internationally, but I have unable to persuade even the Liberal Democrats to pursue the idea.

Mr Ryan's border adjustments are an alternative idea, and look simpler. In essence corporate taxes would be based on the location of revenues - something that would not be easy to distort. So, applied in the UK, Amazon or Starbucks would not be able to use spurious intellectual property charges to relocate profits to tax havens. Overall the scheme favours countries that have trade deficits (like the UK or US) rather than surpluses (like Germany or China), but that is no bad thing.

And probably unilateral action by the US is the only way much is going to happen. Multinational forums like the G20, and even the European Union, have completely failed to deal with this problem. Only the US has the power for unilateral implementation. Where it leads, others will be forced to follow. And post-Brexit Britain should be able to follow quickly.

Alas the power of corporate lobbyists in our democracies remains massive. They are masters of quietly undermining radical ideas and promoting "compromises" that have only superficial effects. Mr Trump is a sceptic, and that's a very bad start. The hope must be that Mr Ryan will get his way in the inevitable horse-trading between the presidency and congress. Mr Trump may be sceptical, but he is not strongly against it either.

But even if this reform attempt fails, I hope that liberals everywhere will take on the challenge of corporate tax evasion with a radical approach, such as border adjustment or unitary tax. Alas I am not optimistic.

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Back to realpolitik: only the promise of prosperity will ensure the return of liberal diplomacy

Yet another ceasefire has been arranged in Syria's civil war, although this morning it looks close to collapse. The difference with this one is that the US and the EU have not been involved in its negotiation. And, not coincidentally, it does not include the Kurdish forces. It is the result of a rapprochement between Russia, Iran and Turkey. It looks as if this is the shape of things to come: a world where there is only the faintest pretence that countries should look out for the needs of people outside their own borders.

It looks like the death of an idea: liberal diplomacy. For liberal diplomacy, and its cousin the ethical foreign policy, the object of diplomacy, and the use of military power, should be to create a better world. A world of peaceful relations and prosperous trade, where human suffering is the responsibility of all. In its place we are left with the idea that countries should pursue their interests, and seek whatever advantage they can. There is an old name for this approach: realpolitik. It was the way most countries ran their affairs before the First World War, with only a few prominent dissenters, such as the British Liberal leader William Gladstone.

How it resolved in that era was that countries were ordered into a small number of great powers, able to conduct independent foreign policy, and project their power over a sphere of influence. Then came minor powers, nominally independent, who did the best they could in the spaces left behind, and finally subject nations - colonies, protectorates and such, managed by great powers, and sometimes minor ones. It was a system established at the Congress of Vienna in 1815, after the fall of Napoleon. It was taken for granted that major powers would use force to pursue their interests - and that their only constraint was avoiding wars between themselves. This did not always work. From 1853 (the Crimean War) to 1870 (the Franco-Prussian War) there were a series of short wars between European powers. But, compared to previous periods of 99 years, the years from 1815 to 1914 were remarkably peaceful for Europe. But it had its dark side. The great powers exercised their might with little restraint within their spheres of influence. It was a century of colonial oppression. The weakness of the Chinese empire was cynically exploited: amongst other things the British used force to maintain the opium trade there; the death and destruction wrought in Belgian Congo is probably the biggest blot on a cynical century. And in the end the prevailing matter-of-factness about the use of warfare led to the European powers to drift into a catastrophic war in 1914.

After 30 years of war and an unstable interwar period, in 1945 the world moved into a different order: the Cold War. The Cold War resurrected the idea of realpolitik, but between just two great powers: the United States and the Soviet Union. And these powers projected their power within their respective spheres with an ideological slant: promising to promote peace and prosperity amongst their allies through their political philosophies. But the failure of the Soviet system to deliver its promises became so obvious that it collapsed from within in 1990. This ushered in the period of liberal diplomacy that now seems to be coming to an end. It was not without its success. Perhaps no period of 30 years in human history has seen so many people lifted from abject poverty - as the countries left behind in earlier phases of development took advantage of a peaceful, trade-friendly world (and ,some might say, the enlightenment of neoliberal economics).

What caused it to fail? I think there were two main problems. The first was that the United States, which emerged as a hegemonic power, became tempted to abuse its position. Many Americans felt that their country should use its massive military power impose its will in a manner more explicitly to favour its narrow interests. These were led by the Neo-Conservatives who gained influence in the presidency of George Bush from 2001 to 2008, and reached its apogee with the US invasion of Iraq in 2003. The Neocon strategy was dressed up in the language of spreading peace and democracy - but this convinced nobody. The feeding frenzy of US businesses following the invasion of Iraq was shocking. Other countries, especially Russia and China, resented what they saw as an abuse of raw power, and drew the lesson that they too should advance their interests by building military power.

But the election as US president in 2008 of Barack Obama might have saved the day. No US leader has been as faithful to the idea of liberal diplomacy. But by then it was too late. The financial crash of 2007-2008 had fatally undermined the authority of liberalism. The winning idea of liberalism was that it was the surest route to prosperity. That was how the US won the Cold War, after all. But after the crash, people lost confidence in it. The economies of the developed world stagnated. Amongst those who lost confidence were many American people themselves: Donald Trump won the presidential election by promising to go back to realpolitik. But authoritarians from Vladimir Putin to Recep Tayyip Erdogan, to say nothing of the Chinese Communist Party, saw that they had nothing to lose by pursuing an authoritarian path. And liberal diplomacy without the promise of economic prosperity simply looks like weakness.

So what happens next? The objective of the nascent Russian-led Syrian peace process looks to be first to persuade the Syrian Kurds to submit to the authority of the Syrian government. Russia no doubt also wants to wind down its presence. They also hope that the Sunni rebel groups will either submit or be crushed, except those allied to Turkey, who can expect some form of autonomy. That leaves the question of Islamic State, but the US will help with that. This way forward may bring an end to the civil war, but at a terrible cost. We had hoped for a less oppressive government - instead we will no doubt have to confer status onto one of the most vicious regimes in post-1945 history.

The main uncertainty in this new world of realpolitik is how the new US government will interpret its national interest. The main ideas that are emerging are: the identification of US interests with those of Israel, including a vigorous pursuit of Iran; renegotiation of trade deals to reduce access to US markets; the finishing off of Islamic State's control of territory in Iraq and Syria; and some kind of engagement with Russia. This does not look particularly coherent, and neither does it look particularly rigorous in following the US national interest - so how it will play out in practice is anybody's guess.

Meanwhile China will proceed to consolidate its influence in Asia as America reteats. Russia's main aim for now is to weaken and lift the economic sanctions imposed on it. Russian leaders probably want to establish all the countries of the former Soviet Union in its sphere of influence - but just how far it will be prepared to go in that aim is moot.

But there is one key problem behind all this. The authoritarians taking over leadership of the world powers understand realpolitik and the consolidation of power. But they do not have an answer to economic prosperity. Each country, including Russia, Turkey and even China, is threatened by economic stagnation or worse. That fate also awaits the United States if Mr Trump prevails on protectionism and the Republican deficit hawks prevail on budget policy. That will undermine their authority in the long run, though no doubt the ruling elites will still prosper.

If liberalism, ethics and humanity is to return to world affairs, then its advocates need to show that it is the surest route to economic prosperity. Absent that, the world faces a grim prospect.

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Syria is the biggest blot on an awful year

2016 is not over yet. And one of my bugbears is people reviewing the year before it is finished. Sometimes life delivers a finale in the last week. Who can forget the Boxing Day tsunami? Older readers may remember the Soviet invasion of Afghanistan in the last days of 1978 - an event which changed everything. But surely there is nothing that can possibly happen in the last few days of 2016 that can redeem it - though things could happen to make it even worse. If Jesus Christ was to make his second coming, and call out Nigel Farage and Donald Trump for the evil that they have perpetrated, nobody would believe it was the real Christ, and nothing would change.

Brexit is, of course, the event that most colours my view of 2016, as it is has the most direct impact on me. It has plunged my country into years of bad-tempered, divisive politics and an administrative quagmire for no obviously good purpose, and given has licence to the intolerant to deliver their bile in the name of free speech and democracy. And the election of Donald Trump as US President does similar things - a campaign built almost entirely on untruth and false promise.

But rumbling behind this is Syria. This is not a new story, but one that took an evil turn in 2016. And unlike Brexit or Trump, it has been killing and maiming many thousands of people, and displacing millions. Its effects ripple through to Europe and the rest of the world. The fall of Aleppo to the Assad regime shows the collapse of liberal intervention, led by President Barack Obama, and the triumph of the evil methods of Bashar Assad, supported by Vladimir Putin's Russia and Iran's hardliners. It seems that there is nothing we can do to stop the spread of evil without crossing the red lines that liberals have drawn - about the ethical use of force, and intervention on purely humanitarian grounds. We must kill innocent people and ruthlessly pursue national interests in order to achieve anything, it seems.

2016 (so far) has been an excellent year for Vladimir Putin. Earlier in the year I drafted a post comparing him to Napoleon, and urging the rest of the world to emulate his Nemeses of the Russian Prince Kutuzov and the Austrian Prince Schwartzenberg in undermining him and destroying him. (I do not rate Waterloo as the decisive event in the fall of Napoleon - had he won that battle he would have been beaten soon after). For some reason I never posted it; I would have looked foolish if I had.  Russia has not become bogged down in Syria, as I was forecasting. Mr Putin proved too clever for that. The Russian military has developed tactics for dealing with insurgencies that are economical and effective. They include the indiscriminate bombing of civilians and the targeting of schools, hospitals and anybody who seeks to aid the suffering. These are tactics that liberal democracies find unethical - but we will not intervene to stop their use. Our doctrines of non-intervention make our actions predictable, and that has been exploited by the chess-playing Russian regime. The political left, so critical of much milder tactics when used by the US, stay silent. The right try to divert people's attention to the lesser evil of the Islamic State terrorist network, pretending that it is an existential threat, and that we should ally ourselves with Assad, the Russians and Iran to suppress it - not caring about any innocent lives destroyed by this pursuit of national interest.

The worst of Syria is that all approaches look hopeless. I have been advocating non-intervention by the West, leaving it to regional actors to sort the problem out. But that simply leaves the door open for other actors, like Russia, to intervene on the side of evil, while the interminable suffering continues. Humanitarian intervention? This is treated as a political act and prevented or attacked by the Assad regime and the Russians so that those interventions tilt the balance in their favour. And yet military intervention would have led to a quagmire that would not have made things obviously better. Our allies would quite likely have turned out to be just as nasty as everybody else. We can, with some justice, shrug and blame others for the problem -there are no shortage of culpable suspects) - but that won't stop the suffering.

So there seems to be not much more that we can do that watch, helping refugees where we can. Russia will no doubt seek an exit - though its campaign looks to have been quite economical, it will still cause stress to that country for no obvious tangible benefit. The new Trump regime will be left with the puzzle of how it continues the campaign against IS without goving succour to Iranian hardliners, whom it loathes. Maybe some kind of political settlement will be achieved which leaves Assan in place, but allows other factions space.

But the outlook is dismal. The era of liberal intervention, which started in the 1990s with Tony Blair in the van, is well and truly over. The Middle East has proved too big a task for it. But the policy's virulent left wing critics cannot claim victory - they have been exposed as vacuous complainers with no interest in any alternative strategy for alleviating suffering. The western liberal democracies are diminished. That may not be a bad thing of itself, but we must hope that other powers come forward, able to look beyond narrow self-interest. They must understand that creating a stable and prosperous world is in everybody's interest, but that it cannot be delegated to just the US and its allies. That is slim hope indeed.

Syria represents the worst of an awful year.

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Competence, cosmopolitanism and change. And fewer experts needed forthe liberal fightback

Liberals are traumatised by the Brexit vote in Britain and Donald Trump's victory in the USA. The margins were very fine in both cases, but that is little comfort. Things weren't meant to be that close. And more shocks could be to come. It isn't too late to fight back. But how?

And here there is a lot of confusion. Some want to coopt the tactics of the populists and fight dirtier (like the Guardian's Jonathan Freedland); others say that we should stick to the issues and avoid personal attacks (take this piece from Luigi Zingales, building on experience with Silvio Berlusconi); others again suggest that we follow a populist left agenda in the manner of Bernie Sanders; or perhaps stick with the centre right (such as France's Francois Fillon or Britain's Tony Blair). Or meet the populists half-way by conceding immigration controls and restrictions on trade.

All of these ideas are flawed. One striking feature of both the British and American situations is just how divided the public has become. Accommodating one side of the argument means creating resentment on the other. Bernie Sanders would surely have lost more votes from Hillary supporters than he would have picked up from Trump ones. Recent polling on Brexit voters show that very few on either side have changed their minds.

We should be careful about accepting the populist narrative: that they represent a rebellion by the public against an elite. Most of the people I meet are on the establishment side of the argument, and are passionately opposed to Brexit and Mr Trump. But they are very far from any elite establishment; we are as ordinary in our way as the rebels. And all any political process does is to exchange one elite for another. As Brexit and the Republicans take over, there are going to be just as many angry and resentful people as before - but they will be different people.

Two ironies strike me here. First is that Mrs Clinton was right when she accused half of Mr Trump's supporters of being a "basket of deplorables". Saying so was one of the biggest mistakes of her campaign, and it showed a complete lack of political judgement  because it reinforced the idea of a sneering elite. And yet it is hard to see that there will be any reconciliation with people who have convinced themselves that the problem with the US (and Britain) is that an essentially white heritage is being polluted by incomers, and that the country needs to return to the values of the past. But there is the other half of Mr Trump's supporters, who simply lost confidence in the establishment and just want to shake things up.

The second irony comes from  a seminal moment in the Brexit campaign when leading Brexiteer Michael Gove said that people had had enough of experts - because so many experts were advising against change. And yet the liberal side of the argument was badly let down by experts - or those that were advising their campaigns.  In America those experts has parsed the 2008 and 2012 election campaigns in minute detail and thought they had cracked it. Poll analyst Nate Silver made his reputation by predicting the result with precision in 2012 long before polling day. And yet the expert strategies in 2016 amounted to picking up pennies from in front of a steamroller. They lost the wood for the trees.

What are the experts saying now? They are very quiet, but I think can I guess what they will be saying. Don't panic. Use the confusion and resentment emanating from the new ruling elites to build up a protest vote. Normal service will be resumed.

Well the Trump administration and the Brexit-supporting Conservative government will offer plenty of ammunition to opponents. But it isn't enough. The British Labour Party thought it had the Conservative-Lib Dem coalition on the ropes in the years up to 2015 - such was the popular anger against austerity policies. And yet they lacked a convincing alternative, and all they succeeded in doing was pushing Lib Dem voters into the arms of the Conservatives, while being unable to contain the popular backlash in Scotland. Labour are trying something different now, with a lurch to far left - and the signs are that this will be even less successful. The populists are absolute masters of blaming anybody and everybody else for their problems, and they know how to stir up their supporters and create doubts among the uncommitted.

So what to do? I think that three things need to be at the heart of any fightback: competence; cosmopolitanism and change. Competence because that is what people will soon be yearning for, especially in America as the Trump regime takes control. People like the idea of somebody that creates chaos more than the fact. So any alternative must look like a cool, safe pair of hands. And, I would add, because this goes alongside it, somebody that cares about truth, and can admit awkward facts.

Cosmopolitanism because that really is the only way forwards. The genie is out of the bottle. We are going have to get along with people of different nationalities, races and cultures. There is no future in harking back to cultural distinctiveness. We must grow more confident in our own cultures and learn more from others. Ironically even the populists are doing this amongst themselves. If there is anything that unites the half of the population that is resisting the populists, it is a belief, at some level, in cosmopolitanism. Rallying this group is critical.

Well, Hillary was competent (except at campaigning) and cosmopolitan; and that was not enough. We also need to show that we believe in change. We must accept that the establishment orthodoxy of the 2000s was wrong in many respects. The relentless quest for a narrow vision of economic growth and the crushing of human control in the name of productivity and modernisation must end. All they do is enrich a few lucky people. We need a new vision of modernisation that takes to heart that most successful of Brexit slogans: "take back control." And our experts won't be much help here: we need new vision.

So we need new leaders that stand for competence, continuity and change, and are able to see beyond the myopia of experts. Justin Trudeau has done it in Canada. Who will do it in Britain and America? Oh how I wish I knew the answer to that!

 

 

 

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The European Union needs more political integration, not less

In yesterday's FT former French president Nicholas Sarkozy suggests reforming the European Union, and then offering Britain the chance to rejoin it. This does not look a practical proposition, but it is a useful thought experiment. How should the Union be reshaped?

First of all, we must get past the current British obsession with Brexit. This is shaping the debate in an unhelpful way. Remain supporters are too uncritical of the current EU. Of course they say that the EU should be reformed, but their ideas about how are as sketchy and muddled as Brexit campaigners' ideas about Britain outside the union. And the EU has much deeper problems than the sorts of things that were upsetting British voters. It is not the right place to start when trying to understand where the EU needs to change.

Indeed the EU is beset by three more serious problems than Brexit: the Eurozone, refugees, and populist governments. These are the issues that most concern Mr Sarkozy. He wants a separate governance structure for the Eurozone that will allow further integration of economic governance. He wants a more coherent immigration policy, with a consistent, contribution-based, system of entitlements to state benefits. And he wants to reduce the competencies of the EU Commission so that it bumps into national governments less often.

But we need to take a step back further than even that. Just what is it the we need the EU to do? Its foundation is the idea that European nations benefit from a degree of political and economic integration. There are two groups of overlapping benefits: political stability and peace; and higher material standards of living.

Political stability and peace remain solid achievements for the EU. That these should not be taken for granted can be seen from the wars involving the former Yugoslavia, and from the aggression emanating from Russia. Ethnic tensions can still lead to wars. States with powerful armies can still seek to get their way by force, allowing corrupt elites to perpetuate their power. Furthermore the EU has been part of a dramatic extension of constitutional, democratic government, firstly in Spain, Portugal and Greece, and then in the former Soviet bloc. But these gains are fraying. Populist governments in Poland and Hungary are undermining constitutional democracy. Other governments are failing to deal with corrupt elites. The EU struggles to confront external threats, because to do so it needs consensus - and weaker governments from smaller powers are tempted to use Russia's aid in propping up their corrupt elites. Other countries are too far from the source of trouble to show much solidarity.

One striking thought emerges from this. To confront these problems the EU needs more political integration, not less. It needs a more powerful executive with more EU funds to allocate; it needs more power to police the use of these funds, and be able to apply sanctions to countries that fail to meet standards. It also needs to forge tough deals with such troublesome neighbours such as Russia and Turkey. It needs new institutions to confer democratic legitimacy. It probably needs integrated armed forces. The founding fathers of the EU (before it was even the EU) always foresaw this, but others, led by Britons, have been in denial.

Times have changed. The biggest political problem for Europe is posed by the rise of Russia, with its championing of old-fashioned corrupt elites and nationalistic politics. But Russia is incomparably weaker than the old Soviet Union. The latter could not be confronted without US leadership. The US is in retreat, but, nuclear weapons apart, Russia is not so strong that a politically strengthened Europe, based on Germany and France, cannot stand up to it. Russia's attempts to undermine Europe provide the pretext to unite it. The smaller states of eastern Europe need to understand the choice between a Russian-aligned, weak and corrupt system, or joining the road to something much better. I suspect that they already do if you push them - and that gives a strengthened EU the basis for a mandate.

Economically though, the case for more integration is not so clear. Free movement of people and trade has surely been of enormous benefit. Some interesting work has shown how even brain drains can help the  countries losing workers - the emigrants are replaced, causing greater social mobility. But the pace of change has caused enormous stresses. And, in some countries at least, regional inequalities have become a major headache (Britain is perhaps the worst - if one puts Italy's primarily down to weak institutions in the south).  This is a complex problem, but I think that greater regional and local autonomy is critical, and the union's third great freedom - movement of capital - may need some hedging. I suspect that the real problem is not the balance of power between the EU and member states, but the balance of power within the larger nation states. But some of the EU's single market rules are getting in the way - the limitations on state aid for example.

Then there is the Euro zone. This deserves, and will get, a post (or several) in its own right. Suffice to say that though most Anglo-Saxon commentators regard this project as the essence of madness, it is not dead yet. I believe that floating currencies tend to reinforce and increase inequalities - an argument I need to develop another day - but that fixed exchange rates and weak political governance are a toxic combination, as has been proved on countless occasions, in and out of the Eurozone. The political stresses brought about by the crises in Greece, Cyprus, Portugal and Spain show a degree of failure. (There are successes too: France and Germany have experienced steadier and more equitable growth than Britain has outside the Euro). Mr Sarkozy is right that some form of further integration of economic management is warranted, but a reconciliation between French and German approaches will be needed to make this work.

So where is all this leading? In the extreme France and Germany might lead a new United States of Europe, with much deeper political integration, based on a proper constitution, and, perhaps, a democratically elected president. This will no doubt be tied to the Euro currency area. This new federal state would be surrounded by a looser economic zone, with surrounding countries participating on an à la carte basis.

An interesting question is whether less extreme versions of this idea could unlock enough of the benefits to make it worthwhile. There would be a highly integrated core of countries, alongside a number of less integrated ones.

Where would that leave Britain? Much as I would like my country to be part of further European political integration, politically the country is completely unready for it. Brexit may even be helpful for Europe in the long term, as the country has been a major brake on political integration. If the country does join in, it must be on the basis of a project that is primarily political, not economic. That would be a sea change from how the EU and its forerunners were presented to the British public (by its supporters, that is; opponents have always painted it as a political project with the real goal of a super-state). More Britons are ready for that than used to be supposed, but they are still a minority. But as Britain finds that leaving the EU is no answer to its deeper political and economic problems, and more Britons equate the "good old days" with a suitably idealised membership of the EU (just as they do now with the days before membership) perhaps that might change. On the other hand, for Millennia inhabitants of our island have had some notion of special destiny, separate from our continental neighbours to whom we owe so much. For now we are destined to be observers rather than shapers.

 

 

 

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Making America small again. Trump’s victory marks the decline of the USA

"Make America Great Again." That was the slogan of Donald Trump's insurgent campaign to take the US presidency. It resonated with many Americans. They felt that the US had been subject to serial humiliations in its international dealings, and that Mr Trump's more robust and confrontational leadership would help to reverse it.

But politics is full of paradox. To exercise power is to diminish it. Power accumulates to those who understand restraint. In Britain English and Welsh voters took to heart the slogan of "Take Back Control" and voted for Brexit. The country is now basking in the thrill of exercising direct power in its relations with its fellow European neighbours. And yet the result will be a medium-sized power adrift in a friendless world, seeking to trade freely when everybody else is becoming more protectionist It will be more rather than less subject to the whims of foreign powers. Britons may prefer it that way, but they will come to understand that the keys to "taking back control" actually lie in Westminster and their local council chambers, rather than in Brussels.

So it is in America. Mr Trump's supporters will revel in the assertion their country's direct power. And yet he will exercise this assertiveness in order to carry out a retreat. The result can only be diminishment, relegating the US to the middle part of a medium-sized continent.

Let's look at some specifics. Consider the Trans Pacific Partnership (TPP): the multinational trade deal put together by President Obama. This was a central element of his Asian diplomatic strategy, designed to collect a number of Asian countries into America's orbit in trading terms, conspicuously excluding China. Mr Trump (along with many Democrats) denounces this as a bad deal and will scrap it. That leaves a vacuum into which China is ready to pounce. It plans its own version of a free trade area, involving most of the same countries. Mr Trump has also questioned the value of America's military alliances in the region. The clear message to countries there is that they must acquiesce with China's increasingly imperial ambitions. The Philippines' President Duterte looks a little less eccentric in his pivot to China. The USA is suddenly a much less important country.

Mr Trump's promised assertiveness in trade relations with China makes little sense either. It comes at an important moment in the evolution of China as a nation. It has built its economy on international integration, especially with the US, and developed a large trade surplus in the process. But there is nothing particularly beneficial in a trade surplus - it implies that a country's citizens are consuming less than they could - an act of self-denial. A trade surplus has political advantages - it makes you less beholden to foreign creditors - but China is already powerful enough for this not to matter much. So it is in the process of carrying out an economic pivot to  develop its consumer economy, and away from integration with developed economies - though the scope for integration with less developed economies remains. An economic model where it exports less to America and integrates more with other Asian countries, and even African ones, suits it just fine strategically. Mr Trump means to hurry it along, but it will disrupt the US economy more than the Chinese one.

In Europe the issue is not so much trade. The proposed trade deal between the US and the European Union, TTIP, looks dead in the water without any help from Mr Trump. The main issue for Europeans is military and diplomatic support for the European countries against Russia in particular. Mr Trump has said that the current balance involves America in a disproportionate level of commitment. He has a point. If America steps back from its military commitments, and caves in to pressure from Vladimir Putin to create and extend a Russian sphere of influence, then it will put European countries in a very tough position. It is not very clear where this will lead - but one thing is very clear: America will be less important to Europe. This is not necessarily a bad thing for Europe, but it will be very uncomfortable.

And then there is economics. We are still guessing what will emerge from Mr Trump's presidency - but there could well be a short-term lift for America. Some form of fiscal stimulus is in the offing. Mr Trump and his advisers hope to lure in US corporate profits that are stacked offshore for tax reasons, and to use the proceeds to fund infrastructure investment. Unlike many of his Republican colleagues, Mr Trump will be reluctant to cut state handouts, like pensions or healthcare - though health insurance is under threat. This could give a short term lift to the US economy . And, as this week's Economist points out, much of this gain will be at the cost of other world economies.

That should please Mr Trump's supporters. But the problems will start quickly. The stimulus is badly timed. In many aspects the US economy is running at close to potential output. All the stimulus might do is suck in imports and push up prices. But there may well be a lot of hidden potential in the US economy - more workers could be drawn into the workforce, and other workers could be made to work more productively. But if Mr Trump is serious about rolling back free trade and driving out foreign workers, then he will cut the capacity of the US economy when it needs to be increased. A financial crisis is in the offing.

The truth about the American economy is that, far from being taken for a ride and funding lavish lifestyles of foreigners, American consumption is being supported from abroad. This is what a trade deficit means. A transition to a more self-sufficient economy, as wished for by Mr Trump's supporters, will entail economic shrinkage. Americans may rail at the loss of jobs in many industries, but they exchanged these for cheaper products, made abroad or with automated technologies, or both. Reversing that means reducing living standards.

Except that most Americans could still end up better off. If the country can share out income more evenly, with lower profits and higher wages, and more of those wages paid to middle and lower level employees and less to the top layer, then this shrinkage need not be painful to the majority. But what chance is there of a Republican administration, run by senior businessmen, achieving that? To Mr Trump exploitation is simply good business practice, and profits are reward for enterprise. There is no sign of a mindset that wants a different distribution of the fruits of economic success.

America and the world is in for a rough ride. But strategically it has been clear for a long time that American power, relative to the rest of the world, is in decline. That is not such a bad thing  - it results from a fairer distribution of the world's wealth. After the diminishment of Europe, it is now America's turn. Mr Trump's victory marks a big step along that journey. But it should surprise no follower of politics that he is claiming to do the opposite.

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The centre collapses. What should liberals do?

Unlike on 23rd June (the day of the British referendum on the EU) I went to bed with a sense of quiet foreboding on Tuesday night. And that foreboding was confirmed by the shocking news of Donald Trump's victory in the US presidential election.

It is a bad year for liberals. Some liberals did support the British vote to leave the EU, of course, and persist in saying this was a good thing. Well, maybe, but the campaign was not fought from the liberal centre, it was fought and won by those who persuaded the illiberal to vote in their masses - which is similar to Mr Trump. Meanwhile, illiberal governments face no serious challenge in Hungary and Poland, and in Turkey President Erdogan is crushing all forms of opposition, liberal and otherwise, following the example of President Putin in Russia. It does not seem so far-fetched to imagine that Marine Le Pen will take the French presidency next year. There are major populist uprisings in the Netherlands and Italy.

All this points to a collapse in the political centre. What do I mean by that? The centre is a set of political assumptions about the way the world should be run which has become the conventional wisdom of our governing classes, and which is shared by many political groupings. Those who did not support this centre used to be branded as extremists and pushed to the margins. Or sometimes parties would talk as if they were challenging the centre, but quickly adopted its principles once in power - France's François Hollande comes to mind. Centrist principles incorporate free trade, free movement of capital and free movement of workers - an unmistakably liberal combination. Globalisation, and the economic growth that went with it, were embraced. Social liberalism ran alongside these principles, with the promotion of diversity at all levels of society. In Britain, Tony Blair's enthusiastic embrace of these centrist values was the key to his taking the Labour Party to three election victories in 1997, 2001 and 2005. The Conservative victory in 2015 largely came about because it persuaded electors Labour had turned away from the centre - though, in a portent, the avowedly centrist Liberal Democrats were crushed in the process.

But Mr Trump's campaign was based precisely on a rejection of the centre. He painted a picture of a politically corrupt and complacent elite who had let people down, and imposed social liberalism onto unwilling subjects. This brought previously apathetic voters out of the woodwork, and persuaded many who had voted for the left in the past - blue collar workers in particular - to change allegiance. By comparison Hillary Clinton struggled to raise enthusiasm for her campaign; this apathy may actually have been more important than enthusiasm for the insurgents. It would be wrong to blame that on her personally. She was in fact a strong candidate, but she represented a ruling philosophy that people have lost faith in. President Obama may be more charismatic, but his intervention seemed to have little impact. He seemed to be part of the problem.

Could the left have achieved a similar success with its own anti-establishment campaign? This is what Democratic contender Bernie Sanders attempted; and it is what Britain's Jeremy Corbyn seeks to achieve. Like all counterfactuals this is impossible to prove. Many of the criticisms against Messrs Sanders and Corbyn - their lack of so-called "credibility" - seemed to positively benefit Mr Trump. But I think the rebellion is about more than changing personalities and attacking the political elite. There are overlaps in policy; Mr Sanders wanted to clamp down on free trade and attack big business - just as Mr Trump  does. But he also stood for big government and social liberalism. These do not resonate with the disaffected. It might rally a lot of younger, urban people - but not the white working class. It would not have been hard for the Republicans to paint Mr Sanders as in fact being part of the liberal elite, who would bring with him socially liberal values, more interference in people's daily lives, and higher taxes.

But for all that, the liberal left shares a disillusionment of the conventional centre with the conservative insurgents. They see the economic gains going to a lucky minority, while working class, and many middle class, people face increased insecurity - especially if they are young. The trouble is that the left lacks a convincing policy agenda to address it. Their solutions have a lot of the "same old" about them. And in particular they lack ideas on how to promote a thriving business environment, beyond more active demand management through fiscal policy, also promoted by Mr Trump, it has to be said.

So how to respond? Of course Mr Trump and his associates equally lack a convincing policy agenda to address the concerns of the left-behind. They will throw them some socially conservative red meat, but it is hard to see their economic policies making them better off. Meanwhile many social benefits, starting with health insurance, will come under threat. This gives the left the raw ingredients for a fightback. The developed world is becoming more socially liberal, so liberals must hold their nerve. And as conservative economic and foreign policies fail to gain traction, there will be more sticks to beat the conservatives with. Competence may come back into fashion.

But the left still needs a convincing policy agenda of its own. The old centrist agenda needs to be picked apart and put back together again. In my view this means a strengthening of local communities. Somehow a flourishing global economy needs to cohabit with flourishing local economies. Our hope must be that as Mr Trump as his conservative allies test their economic ideas to destruction, it will open people's minds to fresh ideas. But those fresh ideas need to be fleshed out.

 

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The same arrogance that created disaster in Iraq is behind Brexit

It is a very British piece of political theatre. Yesterday Sir John Chilcot published the results of his enquiry into the Iraq. It is exhaustive, scrupulous, but examines events that are now ancient political history. Historians will find it useful, but in the big picture it tells us little we did not know already. It will have changed no minds. No currently active political career is affected. The US State Department spokesman sounded very puzzled over the attention the affair is getting, given the pressing challenges facing the world. No doubt that puzzlement is felt by other foreign observers. What was the point?

All I can say to that is that it is just the British way. We like to produce weighty reports that achieve little. Some people find it cathartic. It is much easier to reflect on the mistakes of the past than to consider a very messy present. I particularly enjoyed this reflection by an anti-war leftist in the New Statesman (Thank you Martha Zantides). I have always felt that moral certainties are evasions; my views on Iraq have always been ambiguous, notwithstanding the clear stand made by my party, the Liberal Democrats.

But I think it is a good moment to reflect on the nature of political power and decision-making. The immediate concern of Chilcot is Britain's role in Iraq. And the main point here is how the moral certainty of Tony Blair, our then Prime Minister, managed to subvert the checks and balances of institutional decision-making to throw the country behind an American project, over which British leaders had very little influence. In Mr Blair's eyes Saddam Hussein was a vicious dictator and a threat to world peace, and needed to be removed. He encouraged the Americans to work to that end, and backed them when they took the project on. After that he and the British were helpless passengers. British military resources, also committed to Afghanistan, were overstretched and forced into ignominious retreat - a small fraction of the continuing catastrophe that enveloped Iraq. Could this sort of thing happen again? Certainly; our institutions still favour the executive - though our capacity to act, and willingness to embroil ourselves in foreign adventures, are now much diminished.

But the British dimension was a sideshow. The real disaster in Iraq reflects the US political process. This firstly led to a reckless drive towards war, and, more culpably, a massive mis-judgement of how to deal with the aftermath. Driving these disastrous decisions was group of officials and politicians with a clear, driving vision. The most notorious was the Defence Secretary Donald Rumsfeld; there was also Vice President Dick Cheney (who brought shadowy commercial interests into the picture) , and the highly influential Paul Wolfowitz, a real ideologue. Collectively these were known as the Neo-Conservatives, or Neocons.

The Neocons had a clear vision of the world and America's role in it. They wished to push over dictatorships using US military power, and let the grateful people set up democracies and unregulated market economies in their place. They dismissed the legions of diplomatic and military types who made practical objections as being hidebound by old norms. They seized on small scraps of evidence that supported their case, and dismissed anything else. This was exploited by a group of Iraqi exiles, notably Ahmed Chalabi, who had no real political base, but told the Neocons what they wanted to hear about the country's readiness to embrace American ways. This process, whereby an arrogant, visionary clique creates a simplified world view in the teeth of the evidence has been given a name: "groupthink".  There are plenty of examples down through history. There are notable parallels within the ruling elites of Germany and Austria-Hungary before the First World War, for example. Democracies should not be as vulnerable as autocracies, as there should be more pluralism of thought, but Iraq showed that the US and British systems are not immune.

And in Britain we are now in the middle of another catastrophe brought about by groupthink - Brexit - though thankfully not one so threatening to human life. Amongst the supporters of Brexit in the British establishment we see the same ideological zeal, and the same unwillingness to get involved in the practical details. Chief amongst these is the Justice Secretary Michael Gove. This man is full of visionary zeal, but he seems unwilling to listen to experts. Indeed he publicly dismissed the usefulness of experts in the referendum campaign. This was evident in his stint as Education Secretary, when he dismissed the educational establishment as "the Blob". Experts often lose the wood for the trees, and so must be open the challenge. But the answer is not to drive a bulldozer through them. Mr Gove's term at Education achieved some good things, but was mainly a colossal waste of effort, which we are still picking up the pieces from.

Alongside Mr Gove sit, or sat, political opportunists like Boris Johnson and Andrea Leadsom, and anti-intellectual populists like Ukip's Nigel Farage. And behind them there are a coterie of Brexit backers, a group of businessmen, financiers, think-tankers and retired officials who provide intellectual heft. These are united by a loathing of European Union institutions (admittedly not an inspiring edifice). These have created a construct of Britain outside the EU that is not dissimilar from the Neocon vision of Iraq after the US invasion. Hopelessly optimistic, and dismissive of the practical difficulties of achievement. These people are still popping up on Radio 4 to tell us all will be well after the first wobbles have been overcome. They have no concept of the pain that Brexit is inflicting on our very sense of self. It's question of puling ourselves together and getting on with it. And if disaster ensues, it will be somebody else's fault. Just like the Neocons in Iraq (and Tony Blair) who blame Iraq's collapse on bad people, over whom they hold no sway.

Meaningful progress does not arrive through a visionary, revolutionary process imposed by a tiny elite. Neither does it emerge from a vacuum - the removal of the forces of order so that a new , more efficient system will emerge by market forces. It happens through a hard process of evolution, comprising a dialogue of bottom-up and top-down processes. It's hard work and requires patience. Alas we have once more fallen victim to the impatient, who will walk away to leave others to clear up the mess.

 

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The EU referendum: the arguments that count

Britain's vote on EU membership tomorrow (23 June) has produced a lot of emotional polemic, and very little dispassionate analysis. I was persuaded yesterday to click through to this article by Professor Alan Johnson (not to be confused with his namesake, the Labour politician) on the basis that "it was the most compelling case for Leave that I have read", to find that it was anything but compelling, as it jumped off from premises that are highly flawed in my eyes. And it made no real attempt to persuade people of an alternative view either. Of course, I am guilty of polemicism too, for Remain. But I try to stand above such things, as well. So on the eve of the vote I will assess the arguments that I think hold water.

I will do this based on the three substantive arguments for Leave: that the EU project is fatally flawed; that free movement of people within the union is too high a price to pay; and that rejecting the EU would give a needed shock to the country's political and economic system. I will then say something about the benefits of EU membership.

A flawed project?

First is the flawed nature of the EU project; this lies at the heart of Professor Johnson's case. What is the EU? It is an association of sovereign states that have agreed to bind themselves by treaty to hold to common standards in a wide variety of areas, to act jointly in others (most importantly in trade negotiations), and hold the whole thing together with a system for developing common policy and resolving disputes. Some of the Union's founders saw this as an intermediate stage towards a United States of Europe, on a similar basis to the USA, and some of the language of the treaties ("ever closer union" ) was drafted with that aim in mind. But it lacks the wherewithal to make such a transition without the consent of the peoples of the member states. Unlike the early USA, there is no federal army to bring dissenting states to heel. Nor can there ever be.

But that leaves the project with some serious problems. Staying within the Union binds member states to a whole series of standards on a take it or leave it basis. Individual countries have little ability to opt out of the bits not to their taste - just opting out of the whole shebang, as Britain now contemplates. That is because it is a carefully balanced whole, and opt outs would be seen by other member states as trying to gain an unfair advantage. But it isn't very democratic. Much ire is raised by, for example, the way Irish voters have been bullied into accepting treaty changes in spite of initial rejection (Professor Johnson aerates about this). But neither is it democratic for Irish voters to impose their will on all the other member states.

This leaves a dilemma at the heart of the project. If you want to make the EU more democratic and accountable, you have to make it look like a more conventional state, taking decisions as a whole union, reducing the autonomy of individual states. If you allow member states to vary treaty terms at a whim, then the whole project collapses.

This dilemma is at its most acute with the imposition of a common currency - which, of course, does not include Britain. Its implementation has been flawed, leading to ugly disputes between debtor and creditor nations. Many say that the only way to make the currency workable is to promote political integration. I don't happen to agree with this, but further integration of the Eurozone could make Britain's status within the union untenable - but we haven't got there yet, and can act accordingly if we do.

There is really no easy answer here. You have to weigh the benefits of joint action against the losses to autonomy. I will come back to those benefits, but there is one clear area of lost autonomy that upsets a lot of people: free movement of people.

Free movement: too high a price to pay?

Our rights within the union to travel to and work in other member states mean that member states have little control over immigration from other member states. Very large numbers have come to Britain from other EU countries, especially the new states of eastern Europe. This is not Britain's biggest immigration issue - which comes from other migrants, who are more numerous and who integrate less easily - but there is a feeling among many that Britain is "full", with excessive stress on housing and public services. Many Britons, especially less educated ones, sometimes feel like foreigners in their own land as they pass through districts settled by people of foreign origin. There is little evidence that European immigration has caused pay levels to fall, but it may have stopped wage rates in some jobs from rising.

Leaving the EU, and its single market, would allow Britain to put quotas on migrants from all sources. This would be popular amongst most of the population. It is Leave's most powerful argument.

The main counterargument is that this would either make less difference to migration than most people suppose, or cause even more stress to services than it saves. Unemployment in Britain is low. Jobs are being created as fast as migrants come in to take them up. Our workforce is shrinking as more of us retire.  So if those migrants did not come, who how would be find people to do the jobs that need doing? The government would be under huge pressure to let the migrants keep coming. We can see that this has happened for migration from non-EU countries - which the government has tried to limit, but which remains high.

There are other arguments. The rights of Britons living in other EU countries (and there are many) would be endangered; the system for administering immigration (an Australian-style points system has been suggested) would be a bureaucratic nightmare; there may be an intractable problem on the border between the Irish Republic and Northern Ireland. And would the politics of immigration controls make the country a less tolerant and open-minded place?

It's messy, and it comes back to the same balance between the benefits of autonomy over the benefits of being part of the union.

A shock to the system

There is also an angry argument. This says that Britain's governing institutions have become complacent and need to be shaken up. There are two groups of complaints, which are not necessarily consistent with each other. One is that the "elite" ignore the social and economic tensions in communities outside the metropolitan South East of England (or devolved Scotland). A second, from businessmen, is that they are overregulating the way we live and work,  and holding back creativity; nothing much is being done to rectify a large trade deficit. There is substance behind both of these complaints. And a vote to leave the EU would constitute a massive institutional shock.

The trouble is that the results of that shock are incalculable. The British trade and government deficits leave the country vulnerable. A prolonged period of political and economic uncertainty would be extremely damaging.; it is not inconceivable that the country would have to call in the IMF, and face economic conditions much more severe than anything the EU imposes.  And who would take political control in the wake of a Brexit vote?

It really depends on how much risk you are prepared to run, and how likely you think that what emerged on the other side would be better than what we have now.

So what are the benefits of the Union

A decision on which way to vote may be affected by a worries about the short-term chaos that may or may not arise from a vote to leave. But the main factor behind any decision must be a view on the longer term benefits of the union - to weigh against the loss of national autonomy. There are three important ones: the single market, extended personal rights, and the Union's political project.

The single market is the most talked about of these, and the most important - it was why, after all, that Margaret Thatcher was initially happy with the trade-off, though she changed her mind later. The important point here is that in order to have a true single market, in which businesses can sell to each other across the union on a playing field that is rather more level than otherwise, you have to go way beyond the absence of tariffs - which is implied by the idea of a "free" trade area. Barriers to trade  are about much, much more than this. It is about standards, regulations and subsidies. Is it fair that one country can undercut another through lower environmental standards, inhuman working conditions, or state subsidies? But addressing these issues is intrusive. Most of the power of the US federal government arises from its constitutional power to regulate interstate trade.

The EU single market is an imperfect compromise, inevitably, but it has taken the idea much further than any other association of sovereign states. The economic studies I have seen have shown that it has largely worked. Trade between the EU states has increased massively since the single market was developed (and not by diverting it from the rest of the world) - it has been much more effective in this that the single currency, which has had little measurable impact. There is bound to be a significant economic cost to withdrawing from it. It makes Britain a much riskier place to build a car factory, for example. This is why economists and businessmen so overwhelmingly support staying in.  The Leave campaign have resorted to quoting the same two: Andrew Bamford and James Dyson over and again; Remain can call on hundreds.

A second benefit is extended personal rights. We get these when we travel abroad, and, especially, when Britons live or work abroad. These are imperfect, of course, but life is much easier for us than, for example, for Australians. This will be irrelevant for those that don't travel - but many of us do, if only to holiday in other EU countries.

A third benefit, on the other hand, is very indirect: the EU's political project. This has been to spread the standards of democracy, the rule of law and good governance across the continent of Europe - to say nothing of making warfare amongst the nations unthinkable. From its initial core of countries the union has been the leading force in democratising first southern Europe, and then post-communist central and east Europe. This is reaching its limits. New members may be brought in from the former Yugoslavia and Albania, but Turkey and Ukraine look like steps too far. More important, there is much work to do to consolidate democratic standards in the post-communist members, especially in Romania and Bulgaria, but in most of the others too. This worthy project would be weakened if Britain left, even if we individually feel little impact. Closer to home the EU has also a vital part of the fudge required for the Northern Ireland peace settlement to stick; leaving would add to the already big headaches there.

In conclusion

I was going to mention the host of spurious arguments that have been put up in the campaign, mostly be the leave side (such as the one about the EU's economy being weak, as if that would not be just as much a problem if Britain was out of the EU), but I've been going on for long enough.

It will be clear from the above that deciding the best way to vote means making some tricky judgement calls, balancing the costs and risks either way. This does not mean that the choice is marginal or unimportant - it would make a big difference to what this country becomes. In these tricky circumstances we are guided by value judgements.

If you are angry about the restrictions European treaties place on our politicians, that will point you towards Leave. If you are reasonably happy with the status quo, and want any change to be gradual, that points to Remain. If you feel that in order to make our way in an interconnected world the countries of Europe need to take joint decisions; if you are happy with the idea of Europe as an extension of "home"; if you don't mind that so many of your neighbours are from other European countries; then that points to Remain also. Which doesn't mean that you should be happy with the way things are, but that Britain leaving the EU would be a step backwards, not forwards.

And me? I was just to young to vote in the 1974 referendum - but I was a very keen supporter of Britain's membership at the time. It has been a defining part of my political outlook ever since. I wanted to be part of something bigger than Britain, much though I love it. I still do, though I have fewer illusions about what is going to be possible. So for me voting Remain was an easy decision. For most of my compatriots it may not be.

 

 

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