Paul Krugman: Fear, Loathing and Brexit
Should Britain stay in the European Union?:
Fear, Loathing and Brexit, by Paul Krugman, NY Times: There are still four and a half months to go before the presidential election. But there’s a vote next week that could matter as much for the world’s future...: Britain’s referendum on whether to stay in the European Union.
Unfortunately, this vote is a choice between bad and worse — and the question is which is which. ...
The straight economics is clear: Brexit would make Britain poorer. ... Britain would end up about two percent poorer than it would otherwise be, essentially forever. That’s a big hit. ...
True, some Brexit advocates claim that leaving the E.U. would free Britain ... to deregulate and unleash the magic of markets, leading to explosive growth. Sorry, but that’s ... the same free-market fantasy that has always and everywhere proved delusional.
No, the economic case is as solid as such cases ever get. Why, then, my downbeat tone about Remain? ...
The so-called European project began more than 60 years ago, and for many years it was a tremendous force for good. It didn’t only promote trade and help economic growth; it was also a bulwark of peace and democracy in a continent with a terrible history.
But today’s E.U. is the land of the euro, a major mistake... Britain had the good sense to keep its pound, but it’s not insulated from other problems of European overreach, notably the establishment of free migration without a shared government. ...
But ... the most frustrating thing about the E.U.: Nobody ever seems to acknowledge or learn from mistakes. ... I feel some sympathy with Britons who just don’t want to be tied to a system that offers so little accountability, even if leaving is economically costly.
The question, however, is whether a British vote to leave would make anything better. ... I fear that it would actually make things worse. The E.U.’s failures have produced a frightening rise in reactionary, racist nationalism — but Brexit would, all too probably, empower those forces even more...
Obviously I could be wrong about these political consequences. But ... Britain will still have the option to leave the E.U. someday if it votes Remain now, but Leave will be effectively irreversible. You have to be really, really sure that Europe is unfixable to support Brexit.
So I’d vote Remain. There would be no joy in that vote. But a choice must be made, and that’s where I’d come down.
Posted by Mark Thoma on Friday, June 17, 2016 at 08:33 AM in Economics |
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