The government is using Brexit as a scapegoat forits own failures
David Lammy, the Deputy Prime Minister, chose last week to reopen the issue of the UK rejoining the EU. Asked if we will go back into the customs union, Lammy not only refused to rule it out, but seemed enthusiastic about it. “That is not currently our policy. That’s not currently where we are. But […]
Crawling back to the EU after Brexit will only end badly for Britain
Clear signals are being emitted by Keir Starmer’s government on the European Union (EU). A much closer relationship is being sought on a wide range of issues such as trade and defence. For the time being, the Prime Minister has ruled out a formal application to rejoin the bloc. But it would not be a […]
Economics has a lesson for Remainers and lockdown-lovers who refuse to let facts change their minds
Christmas is a time to be charitable. So let’s spare a thought for those who fought against the referendum result. Unlike the great unwashed, who simply didn’t understand the issues they were voting on, they had all been expensively educated at the right sort of schools and universities. From the time the vote took place […]
The economic impact of Brexit tariffs only tells us half the story
Brexit is about much more than the economic costs and benefits, but the idea that the former dramatically outweigh the latter has become the received wisdom in much of the media. Report after report emerges which purports to show that, under any of the various trade arrangements envisaged, the UK will be worse off as […]
Britain is more optimistic about Brexit than gloomy forecasts suggest
The International Monetary Fund (IMF) is up to its usual tricks. Last week, it predicted a two-year recession in the UK in the event of a no-deal Brexit. Even in the main forecast, involving a mild Brexit, GDP was projected to grow by only 1.2 per cent this year and 1.4 per cent in 2020. […]
This Nobel-winning economist can tell you why there’s no Brexit consensus
Should pure blue sky research be funded? Certainly, the answer from government-backed research councils seems to be “no”. The emphasis is increasingly on research which has immediate practical applications. Yet seemingly esoteric research can shed light in quite unexpected areas. For example, a PhD thesis written by a then obscure research student 70 years ago […]
Europe has suffered from the euro – just ask the Greeks
One of the entertainments of the holiday period was reading Adults In The Room, the book by Yanis Varoufakis. It describes his time as finance minister of Greece, and his negotiations with the IMF, the European Central Bank, and the European Commission. Varoufakis was only in the job between January and July 2015. He had the […]
The Ghost of Christmas Past could tell us where the negotiations all went wrong
In Charles Dickens’ A Christmas Carol, Scrooge finds being haunted by the Ghost of Christmas Past unbearable. He begs it to stop. The Ghost replies: “These are the shadows of things that have been. That they are what they are, do not blame me.” It might almost be the Prime Minister speaking about the whole […]
Economies of the future will have to engage with the world, not just the EU
The fire and the fury rage from day to day around the outcome of the Brexit process. The discussion has lost sight of the longer-term context in which both the UK and the EU will operate, regardless of the precise deal which is or is not struck. In the 1960s, the countries which are now […]
The Bank of England’s own data negates Carney’s overhyped house price warning
No one can tell them quite like Mark Carney, the governor of the Bank of England. He appears to have briefed the cabinet last week that house prices could fall by 35 per cent in the event of a no-deal Brexit. To be fair, the Bank did try to qualify this figure by saying that […]
The UK’s capacity to innovate matters far more than panic over consumer spending
The debate about Brexit has become mired in a virtually incomprehensible quagmire of detailed and technical negotiations between the UK and the rest of the EU. Yet the campaign itself in 2016 was dominated by broader questions of political economy. In addition to the hurly burly of claims about extra NHS spending or Project Fear, […]
Mark Carney has bigger things to worry about than meaningless Brexit forecasts
The governor of the Bank of England, Mark Carney, is up to his usual tricks. Last week, he claimed in front of the Treasury Committee of the House of Commons that British households are now more than £900 worse off after the vote to leave the EU. The figure was obtained by comparing a forecast […]
Master the art of brinkmanship to run Brexit rings around Barnier
Michel Barnier invokes a wide range of emotions this side of the Channel. To his credit, the EU’s chief Brexit negotiator appears to have a stronger grasp of the insights of game theory than his UK counterparts. Thomas Schelling, the polymath winner of the Nobel Prize in economics, advanced the science of game theory in […]
How European commissioners really allocate EU funding
“Pork barrel” has been a theme in American politics for almost as long as the United States has existed. Many members of Congress work hard to secure public works projects, agricultural subsidies and the like for their own districts, almost regardless of the economic arguments for and against. Surely the European commissioners would rise above […]
The UK could teach the Eurozone a thing or two about successful monetary unions
The Office for National Statistics (ONS) published last week some figures which show how a successful monetary union works in practice. It is not obvious at first sight, from the dry heading: “regional public sector finances”. The ONS collects information on the amounts of public spending and money raised in taxes across the regions of […]
