Results for “brexit” 205 found
What is the best way to think about secession?
That is the topic of my latest Bloomberg column, here is one excerpt:
When an empire is crumbling, and the rulers are very bad, the libertarian approach to secession makes good sense. That said, it’s not a fully general principle.
Sometimes a region wants to leave a country because of differences of ethnicity, religion, language or background culture, as is the case with the Scottish independence movement and the Catalonian secessionists. In those instances, it’s not obvious whether a unified or a newly independent government would result in greater liberty and prosperity. And for all the strong feelings you will find, I am not sure there is an objectively correct moral answer as to whether there should be one nation or two.
We do know, however, that political tensions rise and emotions tend to flare as such secessions approach the realm of possibility. For instance, there is a chance the government of Spain would react aggressively to what it perceives as an unconstitutional Catalonian secessionist attempt. Madrid might institute legal sanctions against Catalonian leaders or, in an extreme case, send in troops. The final result could be no independence and less liberty in all parts of Spain.
The problem is that people are often overly passionate about political boundaries, and an extra dose of irrationality isn’t exactly what the world needs right now. To cite another example of this problem, the Brexit referendum seems to have lowered the quality of debate and governance within the U.K.
There is much more at the link, including a discussion of why the American Revolution might have nonetheless been a good idea, and also why the libertarian approach needs to be supplemented with conservative ideas.
Do Republicans give their representatives more ideological slack?
I found this intriguing:
According to several years of nationally representative survey data, about two-thirds of Americans believe that elected representatives should “try their hardest to give the people what they want.” Remarkably, however, Republican voters are between 20 and 30 points less likely than their Democratic counterparts to agree. Moreover, people represented by a Republican member of Congress are almost 20 percentage points less likely to perceive their member as behaving that way, regardless of their own party identification.
It’s not as nefarious as it sounds. Republican voters, whether they consciously realize it or not, are more comfortable with what political scientists call “trustee-style representation,” whereby representatives use their own principled judgment when casting votes. In contrast, the “delegate style” binds legislators to constituent demands. Many Republicans — voters and lawmakers alike — cherish their principles more than they do the whims of a mostly uninformed and inattentive mass public.
…members of groups that comprise the Republican base seem especially averse to delegate-style public overtures. Even after taking account of other forces that might shape citizens’ views of lawmakers, we found that traditionalistic Christians are 23 points less likely than seculars to say that representatives should “give the people what they want.” Instead, they should “stick to their principles, no matter what the polls might say.”
…when Republicans think their representatives are getting soft, they try to hold them accountable. In surveys, we asked respondents to tell us not only what kind of representation they wanted but also the kind they thought they were actually getting. Democrats proved 23 points less supportive of their representatives when they perceived them paying too little attention to public opinion. In contrast, Republicans were up to 50 percentage points less supportive when they saw them paying too much attention.
Fourth, judging from legislative roll-call data since 1985, Republicans in Congress have been considerably less likely than Democrats to follow their constituents’ policy preferences — a tendency that has grown over time. We found that the ideological convergence between voters and legislators is more than three times greater among Democratic legislators than among Republicans.
There is yet more of interest at the link, from Monkey Cage, by David C. Barker and Christopher Jan Carman.
Does the UK need a second Glorious Revolution?
That is the topic of my latest Bloomberg column, more or less, here is one bit from it:
That leaving is so difficult, however, may in part explain the desire to leave. In the most sophisticated cases for Brexit, there is no acceptable resolution to the negotiating dilemmas. Rather many Brexiteers think their nation’s culture and legal system need to take their own courses. For better or worse, they think England in particular simply can’t become that much more “continental.” What appeared to be a wonderful deal — free trade but no euro — actually was viewed as a Trojan horse for the disappearance of British uniqueness. Over time the encroachments of EU law and governance will clash more and more with the underlying institutions and culture of the U.K., and something will have to give. Law and culture eventually must prove congruent, but EU legal and bureaucratic powers will inevitably grow, ultimately clashing with the notion of Britain as an idiosyncratic and independent nation. Culture and law cannot remain so separate forever.
I have myself been strongly pro-Remain, but I don’t dismiss the Leavers as a bunch of ill-informed voters or hapless victims of globalization. Counterintuitively, it is the supposedly undereducated Leavers who have the more theoretical and historical perspective. It doesn’t help that they initially were promised a much weaker set of ties with the EU, and so mistrust makes all of the complaints more potent.
On top of all this, many Brexiteers suspect there won’t be any better time to leave than now, and so “Remain” is for them an impossible stance over the longer run. Returning to history, ejecting James II seemed risky and destabilizing at the time, but for the most part the decision wasn’t regretted and it was better not to have hesitated.
Do read the whole thing.
To what extent is current alt right populism an Anglo-American phenomenon?
That is the topic of my latest Bloomberg column, here is part of the argument:
More generally, the U.S. is an environment where new products — and here I mean of the non-political sort — get started relatively easily. People are willing to take more chances with their consumption, and so this is a fertile environment for startups, which then spread to the broader world.
As for Britain, the traditional aristocracy is remarkably weakened, voting along class lines has disappeared and, most observers agree, if it were really up to the House of Lords, Brexit wouldn’t be happening.
On top of these factors is English, by far the world’s leading language for scientific and philosophic and political discourse, for blogs, for Twitter, and for many other kinds of dialogue. We shouldn’t be surprised if new ideas are more likely to surface and take hold in the English-speaking world.
Here is another bit:
To be sure, some evidence suggests the influence of President Trump is actually causing Western Europe to become more liberal. But don’t confuse style and substance. Another five to 10 years of deindustrialization, terrorist attacks and migrant crises might lead to a “home brew” version of Trumpian ideas in continental Europe, albeit cloaked in a more intellectual and more aristocratic garb. There is a running joke going around along the lines of “If fascist ideas come to [Country X], they will come in the form of anti-fascism.” Once the properly European version of the product comes to the fore, it might do very well indeed.
There is much more at the link.
My podcast with Ed Luce
It was a forty-minute chat (podcast, no transcript), most of all about the decline of liberalism, based around Ed’s new and very well-received book The Retreat of Western Liberalism. We also covered what a future liberalism will look like, to what extent current populism is an Anglo-American phenomenon, Modi’s India, whether Kubrick, Hitchcock, and John Lennon are overrated or underrated, and what it is like to be a speechwriter for Larry Summers, among other topics. Here is the opening bit:
COWEN: Having a taste for the esoteric, I’d like to start with a question. If we go back to the 1680s and James II takes the throne, then, William of Orange comes over from what we now call the Netherlands and pushes him out — was that a liberal development or an illiberal development?
LUCE: At the time, it was very much a liberal development. Of course, we then get the bill of rights. We then get a further restriction of the power of the monarchy that comes with this new Dutch co-monarchy, William and Mary.
In retrospect, given the fact that this is very much the Protestant fundamentalist, the Battle of the Boyne, the victory of the Orange forces, William of Orange. In retrospect, I think it’s being celebrated in a pretty illiberal manner.
Of course, that’s very germane right now in Britain, given that Theresa May is trying to form a government in which the DUP, the Ulster Unionist Party are going to make up the difference between being a minority government and majority government.
It depends which bit of history you’re looking at it from is my answer.
And then I toss him this question:
COWEN: Let’s say we take the British election that was just held. So many people are calling it a mess, chaos, no-good results but, say, I offered you a revisionist view, how would you respond?
I would say it’s the first real election where voting by class has essentially fallen away. You even have Kensington in London going Labour for the first time since 1974.
Voting is now much more by age. You’ve more female representatives than ever before. You’ve 15 Muslims elected, 7 of those being female. More LGBT individuals. Maybe the new liberalism is reflected by that kind of elevation.
Then on top of that, the election definitely thwarted Scottish independence. It probably helped a soft border for Ireland. We hope it’s helping a soft Brexit.
No Corbyn, no UKIP. Wasn’t it exactly the vote we needed and the most liberal outcome you could have imagined, at least relative to all the initial constraints? Or not?
Ed is extremely interesting and articulate throughout.
Again, you can subscribe to the whole series here, we will be doing more bonus offerings of this nature.
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Tuesday assorted links
1. Is a British U-turn from Brexit really workable?
2. New results on right-to-carry laws.
3. Mortality inequality between the U.S. and Canada is a converging trend.
4. The union wage premium in 1950.
5. GMOs boost corn yields by 17%.
6. A bad, too-trendy predictive list of future literary classics.
My chat with Steve Davies on UK politics
This 24-minute podcast was recorded in April, a time when I believe both of us were underestimating the chances of Labour. In any case it was a fun chat, here is the podcast (no transcript), and here is one excerpt:
Tyler: Is Scotland going to leave? Yes or no?
Steve: I would like to say yes but I think no.
Tyler: You want them to go.
Steve: Oh, I definitely do.
Tyler: Tell us why.
Steve: My attitude and the attitude of the majority of English is that it would be pretty good to get rid of the bloody Scots. If there was a referendum on Scottish independence purely in England there would be a clear majority in favor.
More generally: “They talk about how the general election could shape the terms of Brexit, how much further the EU and even the UK will splinter, the prospects for the European left-wing, and the populism underneath it all.”
I am a big fan of Steve Davies. He is a historian, formerly at Manchester, extremely well-read, and now Education Director at Institute of Economic Affairs. He is also great fun to hang out with.
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Is low expected market volatility good for the world but bad for America?
That is the topic of my latest Bloomberg column, here is one bit, the optimistic part:
When observing the evolution of market prices in reaction to Trump, I am currently left with a mix of very optimistic and very pessimistic sentiments.
First, the European Union, and not the U.S., really does remain the center of Western civilization. The underappreciated good news is that European growth rates are edging up, the euro as a currency appears to have a more secure future, and Brexit, though I view it as a major mistake for the U.K., is not pulling apart the broader European project. The refugee crisis has stabilized, and right-wing populist parties are not taking over Europe. I see that (legitimate) concerns about the impact of Trump are distracting many people from these quite positive developments.
Second, I now view many asset classes as at least partially dependent on Chinese capital, but I’m not so afraid of that capital going away, as those positions have built-in hedges. If China does well, the flow of Chinese capital will continue. If China does poorly, capital will leave China rather rapidly and seek out foreign investments, and that too gives non-Chinese markets a fair degree of protection. China’s highly leveraged position may be precarious internally, but the West has a built-in hedge, namely that bad times for China still send more capital our way, at least for a while. That’s another piece of security that we have been distracted from seeing, though I’m not sure it is good news for China itself.
If you were wondering what to make of low expected volatility in markets, it’s typically worth looking at which asset prices have been volatile. I have two nominations: Chinese corporate bonds and Chinese commodity prices, both of which have fluctuated considerably with changing expectations about Chinese deleveraging. But those have not created a broader crisis of volatility, which is consistent with the above story about how the world as a whole has been growing economically safer. Furthermore, the ongoing growth of emerging economies implies more global diversification over the long run for both trade and investment.
Do read the whole thing.
Friday assorted links
1. Noah Smith on productivity, and if you read this piece we’ll become more productive yet.
2. Loveflutter: dating app to use tweets.
3. A bad article but with some interesting content. I say there are no real YIMBYs in this war, only competing NIMBYs. (Question: how many more of you will click because I call it a bad article?)
4. The fish problems of Brexit (FT).
5. No government health care funding for people who won’t make lifestyle changes?
The euro isn’t as bad as we all thought
It still was a mistake, most of all for Greece and Cyprus. Yet overall its prospects are looking up, as I argue in my most recent Bloomberg column. Here is the most revisionist passage:
I now think of the 2008-2012 period as unwinding a long-term bubble of overinvestment in the EU periphery, and thus those were special circumstances when virtually all economic policies were radically underperforming. Given that a recurrence of such conditions is unlikely, the euro will do much better in the future.
Along related lines, compare the performance of fiscal austerity now with that earlier period. Greece has been going through an unprecedented fiscal adjustment, with a primary surplus running at 3.9 percent of gross domestic product; yet Greek output, while ailing, has remained roughly stable. Portugal has been cutting back drastically on public sector investment, dropping its public sector deficit from 4.4 percent of GDP to 2.1 percent. Rather than imploding, the economy grew by 1.4 percent.
Of course, fiscal austerity didn’t perform nearly as well in the earlier part of this decade, and neither did the euro. The economic implosion from the unwinding of the bubble was simply too strong, so we should not overgeneralize from the very negative performance during those years.
Here is the most important passage:
One of the original goals of the euro was to tie countries to the European Union and its rules for free trade and free migration. The major EU country that eschewed euro adoption, the U.K., has now voted itself out the union altogether, to its detriment. Estonia and Latvia, which adopted the euro in part for political reasons to tighten their bonds with the EU, still seem secure against potential Russian aggression. The biggest political trouble spots seem to be Hungary and Poland, neither of which are euro members. That may be a coincidence, but it may also reflect a very real psychological tie resulting from the currency adoption.
Do read the whole thing, there are several other arguments at the link.
Speculations on the forthcoming British election
An interesting theory is that a big victory will make a softer Brexit more likely, since May will no longer have to appease her more eurosceptic backbenchers. And so by 2022, in theory, the most turbulent period of Brexit will have passed, and Labour, or the new centrist ‘Democrat’ Party or whoever is in opposition, are hardly likely to stand on a platform of a European remarriage following the complex divorce. In the meantime another good result for the SNP, which seems likely, will surely give Nicola Sturgeon a mandate for a second referendum. And then there’s Northern Ireland…
That is from Ed West, via Mark Koyama.
Old globalization, meet the new globalization…
France is careening toward a nail-biter presidential election this month that pits a crowded field against anti-E.U. titan Marine Le Pen. But E.U. funds pay her salary, support her assistants, and underwrite the conferences and books she churns out to attack the 28-nation bloc. Key British leaders of the successful Brexit campaign got their financial lifeline from Brussels euros. Elsewhere in Europe, self-identified fascists are paying for rallies to further the future of the “white race” by breaking up the E.U. — all thanks to E.U. money.
…[these parties] get millions because of their heft in elections for the European Parliament, an institution that is short on power but flush with cash.
Here is the Washington Post story by Michael Birnbaum. I say that Hegel, and works of Continental philosophy that use the word “totalizing,” should be raised in status!
Addendum: Here is more from Farrell and Newman.
Friday assorted links
1. Who’s complacent? Not St. George, Utah.
2. Review of David Goodhart, The Road to Somewhere, quite an interesting book, most of all for the UK.
3. Kenneth Arrow was right about information being a public good: “David Pogue tested 47 pill-reminder apps to find the best.” And two-year fellowships at Brookings.
4. Poor Russian families berate a store owner for handing out free bread.
5. Has Tinderization of the NBA improved road records?
Saturday assorted links
1. Did the Congo crisis just get a lot worse?
2. UBI has weak support from top economists in poll.
3. Redux link: “Fiduciary standard for financial advisors actually may increase fees and commissions.” Maybe we don’t know but people, please don’t be a sucker for mood affiliation on this one.
4. Should you google your therapist?
What does robust UK gdp growth show?
Scott Sumner has a very good post on that question, noting that UK gdp growth has been robust and suggesting this refutes uncertainty-based theories of the business cycle. I see the matter somewhat differently, however. In standard real business cycle theory, a’la Long and Plosser, a business cycle is defined in terms of comovement and persistence. The real business cycle “victim” can either take a direct hit to wealth, or by various processes of smoothing and substitution, spread the hit out across various sectors and over time, thereby generating comovement and persistence and thus what we call a cycle. Taking the direct, concentrated hit isn’t a “cycle” but it still is very painful, in most simple versions of the model it is more painful than doing the smoothing.
Now fast forward to Brexit. There is no representative agent, and the shock “attacked” the UK economy in the form of an immediate exchange rate depreciation. That is a hit to wealth, concentrated on import purchases, though with a good deal of smoothing over time, because import purchases are themselves spread out. Presumably British consumers would prefer the price increases to be more evenly distributed, and not just over imports, but it is easy enough to cite reasons why, in heterogeneous agent models, that won’t happen so easily. Of course over time, some of this smoothing will occur, as the Brits reallocate domestic production to substitute for the now more-expensive foreign goods, pulling resources away from a broader variety of sectors.
None of this refutes real business cycle theory once you see that the non-cyclical immediate “hit” to wealth is an ever-present option. The results don’t look like a “cycle,” but they very much fit the overall framework. But the result is a mix of a super-rapid wealth adjustment, and a super-slow motion series of taxes on imports; I think Scott is a little too distracted by not seeing cyclical action at the usual intermediate frequency.
A while ago I estimated the costs of this “hit” at 5,625 pounds per capita, though since then the British pound has fallen even further, thereby raising those costs.
As for the uncertainty theories, I’m not sure the Brexit story is a good case study for them. At first I was uncertain as to whether it really would happen, but not very much any more. It doesn’t seem the market was ever that uncertain about the final results. A known but surprise event came, and the market knocked down British wealth, mostly bypassing the cycle.
The key point here is that the cycle is an artifact, not something that absolutely has to happen. The negative wealth effect is a more fundamental category, and we absolutely have seen one of those in Great Britain.
The puzzle here — and it is a very real one — is why economies sometimes get immediate hits to wealth, and no cycle, and other times they have to go through the wringer with an ongoing process of temporal decay. The answer lies in part with Britain’s nature as an open economy, and the total lack of stickiness in the exchange rate price, but I think there is also more to it than that…