The Real Name Of The Game.

 

 

The referendum on Britain remaining part of the European union has focused minds on the benefits and disadvantages of membership.

In truth it is impossible to make a rational and considered case for staying or leaving on the basis of a simple comparison of National Advantage or disadvantage for any member of the EU.

Political, economic and cultural relationships between the signatory states are so entangled and interdependent that there is no simple way to conclude that any one aspect of the EU agreement is either all beneficial or all bad.

In addition the entire European Union project has historical components that cannot be reduced to contemporary accountable credits and debits – the political and cultural rehabilitation of Germany being the foremost of these.

These complicating factors mean that both sides of the argument are finally reduced to motivating their respective constituencies through vague fears and even vaguer aspirations.

Pro-EU argue that the dangers from leaving the European Union are too great. Anti EU argue that fear of change reflects an unpatriotic lack of confidence on the part of their opponents. They say that Britain can be great outside of Europe. For anyone who wants to really understand the underlying meaning of the European referendum debate this superficial tub thumping is pretty depressing stuff.

There is a way to make a rational accounting of the pros and cons of European membership. But in order to do this we must have an understanding of what membership of the European union actually means within its component states.

Let us start from deconstructing the ‘national advantage’ perspective.

The relationship between Britain and Europe is based on treaties that specify certain obligations. Either the disadvantages arising from obligations outweigh the benefits of membership, or the benefits outweigh the obligations. That seems straightforward enough.

So from the national advantage point of view, our task would be to determine whether Britain or Europe is the net beneficiary of the relationship.

Let us assume that membership of the European Union is net beneficial for Britain and correspondingly less beneficial for the rest of Europe. If this were the case, European elites will be in favour of Britain leaving the European Union. But all of the European union leadership is increasingly openly bargaining for Britain to remain part of Europe.

If on the other hand, membership of the EU net benefits Europe more than Britain we would expect all sections of British society (including the financial elite) to argue that Britain should leave the EU. This is clearly not happening. The financial and industrial elites of Britain are increasingly openly arguing that Britain should remain part of the European union.

The actually observed behaviour of European and British elites does not correspond to a situation where Britain net benefits from the association to the detriment of Europe, or Europe net benefits from the association to the detriment of Britain. From this we can conclude that neither side has net national benefits or disadvantages from this association. Or at least, any comparative advantage or disadvantage is so small as to be incalculable.

If this is the case, comparative national advantage cannot be the rational basis for national elites (or anyone else), deciding either to remain or leave the EU. If the difference is so small as to be negligible why does it matter to anyone either way?

Because the significance of the EU does not lie in the formal relationship between the nation state members and their respective elites.

The first thing most important thing is to establish is that EU is an agreement between elites. European ‘politics’ is actually based on media and politicians doing what is necessary to get respective populations on board with ever increasing integration.

A classic example of this was the excruciating Irish referendum where the people were forced to keep voting ‘until they got it right’. The subsequent political and economic European gangbang of Greece was a further extension of this process. The people don’t ever get a say is a fundamental principle of the EU..

That Europe is a project of elites is hardly a revelation, most people get that. But what most people don’t understand is the consequences of this state of affairs.

Europe is effectively creating a new DEMOS – a new constituency; actually a new republic funded by wealth redistribution within nation state members. The EU is using the existing wealth of nation states to fund the creation of a new organism from within the shell of the old one. It is doing this by redistribution.

What is the nature of this internal redistribution ?

In a British example redistribution means that those who are disadvantaged by various European agreements are effectively paying a toll to those who are advantaged by those same agreements. Of course, it will come as no surprise that those who are disadvantaged tend to be the already poor and those who are advantaged are the already rich.

Here are a couple of specific illustrations of the redistribution process in Britain. They are illustrative of the process as it applies to all relatively affluent nations in western Europe:

Rents

Increased immigration (labour force mobility), from Europe means that rents rise due to increased demand for lower end housing. As a consequence of these rent rises landlords benefit directly. House prices in general are also pushed up as a consequence and all those who profit from housing in general benefit. People who have to pay rent lose out correspondingly. Where do immigrants tend to congregate? Not in affluent areas- prices are already too high! The congregate in poorer areas. Rents and house prices in poorer are pushed beyond the reach of local poor people.

Schools

Increased immigration means that more children are forced into existing provision. Foreign children who do not have English as a first language require many more extra services. These extra services have to come from the provision from existing children.

Where do immigrant children go to school?

Where they congregate of course.

Where do they congregate?

In poorer areas!

Healthcare

See above

Wages

Supply and demand. Increased immigration leads to lower wages.

There is a clear process that can be observed. Over time, the wealth and living conditions of immigrants tend to converge with the wealth and the living conditions of the local host community. In other words, the living standard of a Romanian immigrant into England will tend to rise somewhat and the living standard of the English people around him will tend to move downwards towards the Romanian standard.

This is not controversial. It is an openly stated objective of EU policy to harmonise living standards across the EU. What is not openly stated is that this harmonisation will involve the falling of living standards for a considerable section of the European population.

With this process in mind, one or two things become immediately clear.

There is no national interest as such, in voting for the EU, there never can be. By its very nature the purpose of the EU project is to divide nations up; it is meant to do this. It can never be in ‘Britain’s’ or any other nations interest to stay in the EU or leave because this is a fundamentally mis-stated question!

If you are in an area, that is targeted for transformation, (i.e. if you are a relatively poor member of a relatively rich society), your immediate interest is in stopping the process, since you will immediately lose out. Of course, the poor and ignorant are the least likely to vote or take part in the politics. This accounts for the relatively easy ride the process has had so far.

The areas transformed by immigration will necessarily expand over time. The longer the process goes on, the more that people ‘doughnutted’ in wealthier areas around immigration hotspots will start to feel the effects of the process and realise that they should oppose it.

Because of this, it is CRUCIAL to have as many referendums etc as early in the process as possible (and it is still relatively early in the process), since the longer it goes on, the more likely there is to be organised resistance to the process within relatively wealthy sections of national communities.

And doesn’t this, rather than the supposed national advantage perspective, more accurately correspond with what we actually see?

All over Europe it is people who live in the ‘immigration doughnut’ regions of western Europe who are protesting most about EU integration. (NOT, you will note, those on the EU periphery such as Greece..)

All over Europe it is those sections of national communities that have clearly benefited from ‘freedom of movement’ that argue for increased EU integration. (In Britain, this would be the City of London etc)

To go back to the original question:

Is it possible to make some kind of rational assessment of how much EU has benefited its constituency and disadvantaged those around it?

Well a couple of graphs here* can point towards an estimate:

This is the Earnings to mortgage ratio.

house-price-to-earnings-ratio-600x536

And this is  Bank of England base rates:

base-rates-bank-rates-mortgage-rates-500x354

You can see that broadly speaking, house prices take up an ever increasing proportion of wages in Britain. This process has begun to accelerate in the last decade. The only reason it has not accelerated even more is explained in the second graph which shows that the Bank of England policy of keeping base rates at zero has meant that mortgage rates have been ‘artificially’ held at a relatively low level. As a consequence mortgages are an artifically low proportion of wages.

You can see that where immigration and in particular European immigration is at its most concentrated, in the London region, the disparity between housing and wages is at its most acute.

This is what we would expect to see in line with my description of the redistribution process.

If I had to make a guestimate of the total loss to the poorest part of the British population as a result of European integration I would say:

Loss of wages.

Lack of access to health and education.

Increased rents

Increased house prices

Lost social benefits,( denial of trades union membership, denial of social welfare benefits)

All adds up to a loss of 25% of total wealth so far.

And this is only the beginning.

 

Typical tenant pays £40,000 in rent over five years, report finds

http://www.theguardian.com/society/2016/mar/03/tenant-paid-40000-rent-five-years-shelter

Wages for British workers will rise in the event of a Brexit, head of in campaign says

http://www.telegraph.co.uk/news/newstopics/eureferendum/12181385/Wages-for-British-workers-will-rise-in-the-event-of-a-Brexit-head-of-in-campaign-says.html

*http://www.economicshelp.org/blog/5709/housing/housing-market-stats-and-graphs/

 

There is more to say here:

The Fall of Europe and the Rise of Eurasia

The geo-political reality is that Europe -whatever it’s disputed borders might actually be- is the western part of EURASIA. Europe has managed to exist ‘separately’ for 4-500 years or so because of its relative economic and cultural advantages over the rest of the landmass. It was an economic/cultural grouping strong enough to keep Eurasia out. That relative strength adavantage is evaporating quickly now. The fall of Europe is the rise of Eurasia.

The elites of Europe (and Anglo Saxon elites) are entirely aware of this process. They are ALREADY ‘democratically’ transforming Europe into a LATIFUNDIA system- pockets of relative wealth and stability within the larger western Eurasian area that will be subject to falling living standards and relatively high insecurity.

There will be no progressive, social Europe or EU to be part of in the next decade. There is no possiblity of reforming Europe or the EU. They are both the creation of western European elites and will always continue to be.

These elites were forced to pay lip service to the Anglo Saxon ideal in the post WWII period. But that is no longer possible or desirable for these Europeans.

 

 

 

 

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