Monday, June 27, 2016

Brexit and Immigration: More Millionaires than Terrorists.

Britain just decided, via a close vote, less than 2%, to leave the EU.

This is in my opinion a major mistake.  I am not British, nor am I European, so some may think I have no business talking about it.  That is ridiculous - I have no business voting on it, but I am free to discuss it, just as the British and other Europeans discuss our election.

From an economic viewpoint, larger economies are always better than smaller ones.  It's not just economies of scale, not just saving money by doing things once rather than multiple times (one decision about cigarettes, one decision about food dye #7, etc.).  Nor is it only about having to painstakingly re-do a multitude of treaties.

There is also the innate power of free trade.  It is the great equalizer.  Yes, certain British businesses lose out to more efficient European ones - but the British people benefit from the superior companies. Or they used to.   They won't anymore.

But more importantly, Britain is NOT the 'weaker' part of the EU, as such they are the ones with the better companies that will eat the lunch of the Greece and Portugal.  Yes, separate from the EU, they can set Interest rates and other government regulations to deal just with local problems, rather than European ones, but frankly this is not that big a deal.   If we TRULY knew and understood how to do that then we wouldn't have those issues at all.  Sure, we know enough to prevent extremely high inflation but quite frankly we don't really know the ideal value.  As such, our attempts to control things are misguided.  Yes, they can save a small (relative) amount of cash they contribute to the EU, but they lose out on the economies of scale, etc.

But nationality is not just about economics.  There are also social values.

I could see leaving a Union of the majority of the EU was culturally opposed to the values of Britain.  But that's not really the case.

The main 'cultural' issue that is upsetting Britain is Immigration, and quite frankly most of the EU is anti-immigration and anti-Muslim.  That's not a real difference.  The only real difference is the severity of the anti-immigration movement, which is more so in Britain than in other countries.  Not surprising, as Britain won World War II without being invaded, making them far less sensitive to accusations of tyranny than other European nations, which still the bigotry that the NAZI party forced on them.

But Britain's new bigotry isn't going to help them.   It stops one in a million terrorists, while also keeping out thousands of innovative, brilliant, creative, citizens.   There are more soon-to-be millionaires in those immigrants than Terrorists.   Hard working immigrants outnumber the criminals and give more in taxes than the criminals cost.  The net result is a worse Britain, not a better one. 

 So why do people dislike the immigrants?  They are culturally disruptive. The new millionaires invade the old institutions and demand services.   Those new hard working immigrants take jobs from hard working native born.  And the immigrant criminals steal things the native born criminals wanted to steal.    It's all about the competition, and no one wants it.  Sound familiar?  It is - it's the free market at work.

Just as a free market beats a mercantile one, an immigrant friendly country beats an anti-immigrant one.  It's the exact same principle - let anyone do it and let the market decide who is better.

Britain leaving the EU is a huge mistake.  It's obvious to the financial markets and that's why things are getting bad.    Plus side, good time to buy.

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