I don't vote. I would vote if there was a candidate or a party that didn't want to increase the cost or scope of government, but no such luck for me. My friends and family get upset around elections, were I duly go to the poling station to draw willies on my ballot paper. Choosing between two or more socialist parties that want to take more of our money and spend it on slightly different priorities, for me only validates their mandate. By turning up to vote and invalidating my ballot, I can vote for the electoral system without helping to put any of these pricks in power.
There was one exception, however. I did vote in 2004, saying yes to our country becoming the smallest member state of the European Union. I would also have voted to re-legalise divorce, but I was abroad for that particular referendum. At the time, I was a fan of the European project. I naïvely thought that Brussels could stop Valletta from running amok. The dream of being able to live and work anywhere in Europe, to turn our market of 500,000 people to one of 500,000,000 was intoxicating. Unfortunately, the Euopean project lured me, and so many others, in on false pretenses.
To be clear, I'm not sure I should have voted no. Nor I am sure I would vote to leave if that question were asked of me. EU membership has been good. Personally, it allowed me access to a much larger market for my services and allowed me to live and work in the Netherlands, Germany and the UK. For the country more broadly, it brought legitimacy to our institutions, with which were able to attract massive investment from abroad through a comparative advantage in taxation and regulation. This is possibly the first time we have ever had a comparative advantage in anything, except maybe corsairing in the 17th century. Without membership, our lax rules lose their edge over even friendlier jurisdictions like Panama and the Bahamas, at least to the European customer.
So what has been the price of membership? With project funding and cohesion funds and cushy jobs for our boys in Brussels and Luxembourg, it's hard to see the cost of the European project. But the cost is real and enormous. For starters, there is the price we pay as net contributors to funding the EU, to funding the drug and booze parties in Brussels and the incredible waste and inefficiency of the bloated bureaucracy. To funding massive agricultural subsidies that create (literally) mountains of wasted food. To pay for translating miles of regulation into a myriad of languages, including ours, which no-one, not even our lawyers will ever read in that language.
The waste, white elephants and scandalous expense reports are only the beginning. The regulatory burden is also astounding. Miles and miles of regulation in the name of health, safety, the environment and social 'justice' ensure that in many sectors, the EU will be at a significant competitive disadvantage. All that aside, the main cost is exacted upon us by the second most reckless monetary policy in the world. The Euro was eagerly adopted as the Deutschmark for everyone. unfortunately, we have all been lumped with the Lira. Alas, not the Maltese Lira, but the Italian one. The reckless ZIRP and NIRP policies and bond purchase programs have generated massive inflation. No, not an increase in consumer prices (although that too), but the real and original definition of inflation as evidenced by reflated stock and property markets to bubble levels, record prices at auctions, and most importantly record levels of government debt.
Euro membership has allowed our government to borrow and spend much more than it would have been able to otherwise. And no, there is no surplus. GDP growth that is slightly higher then the current account deficit is not a surplus, the debt is still increasing. ECB and EU policy have incentivised massive government debt growth and deliberately fueled inflation. And despite the marketing campaign, 2% inflation is not price stability and is not good for us.
But again, do these massive costs outweigh the massive benefits of membership that we have successfully reaped? For the moment, no, but the trajectory is very disconcerting. With the British leaving, will that be remembered as it is considered now, as Britain making a fatal mistake, or will the near future make them look prescient? There are dark clouds on Europe's horizon. The EU was supposed to be, as Churchill put it, the "United States of Europe". At the time, the US was highly decentralised, before the war the government accounted for a tiny fraction of GDP and state independence was paramount and celebrated as the laboratory of democracy. Unfortunately, we do not have the United States of Europe, but rather an attempt at the Brussels Hegemony, or a rehash of the 19th Century Frankfurt Parliament. The Frankfurt Parliament is obscure today, as it was an abysmal failure to assimilate the various German, Austrian and Bohemian states into a single country though regulation and inter-state compromise.
Indeed, the focus is shifting away from Britain (who will probably only replace the mistakes in Brussels with problems in London) towards the EU's eastern and southern flanks. The ECB's massive irresponsible gamble has bailed out the PIGS, but should they try to normalise monetary conditions, they will soon discover (if they don't already know) that you cannot solve a problem of over-indebtedness with more debt. And no, they cannot stay this easy forever, as even official 'liar' inflation rates are now close to their mandate and heading much higher in a hurry. Unable to solve the problem of out-of-control inflation and bankrupt governments down south simultaneously, the EU will have a difficult choice; not dealing with inflation will eventually make the Germans (and to a lesser extent the Benelux) throw in the towel, but a rise in rates will force real austerity on the south, which will surely respond with Grexit, Spexit, Portugo and Ciao. In the latter case, the PIGS will find that their old currencies, thought they can be printed, cannot buy prosperity.
The financial apocalypse aside, there is a growing rift between East and West not seen since the rusty curtain. The East is showing signs of independence, unfortunately largely motivated by racism. The exit of Britain (or Brexit, if you will) has upset the balance of power within the union. Allemagne and Frankreich now have only Malta, Ireland, Poland and others (depending on the issue) opposing the Brexit response. This response is massive centralisation. We can expect an increase in the regulatory/litigational clampdown on Ireland's and Malta's taxation and regulatory independence. We might see rules aimed directly at tax and regulatory 'evasion' as the Franco-Germans bring der hammar down. this will negate the main advantages to our membership and leave us with only the costs. This policy might see the exit of some countries in the East but Malta will most likely go along for the ride and then it will be too late for me to vote no.
Dingle, Ireland 26th June 2018
TLDR: The European project is being betrayed by parastatists
There was one exception, however. I did vote in 2004, saying yes to our country becoming the smallest member state of the European Union. I would also have voted to re-legalise divorce, but I was abroad for that particular referendum. At the time, I was a fan of the European project. I naïvely thought that Brussels could stop Valletta from running amok. The dream of being able to live and work anywhere in Europe, to turn our market of 500,000 people to one of 500,000,000 was intoxicating. Unfortunately, the Euopean project lured me, and so many others, in on false pretenses.
To be clear, I'm not sure I should have voted no. Nor I am sure I would vote to leave if that question were asked of me. EU membership has been good. Personally, it allowed me access to a much larger market for my services and allowed me to live and work in the Netherlands, Germany and the UK. For the country more broadly, it brought legitimacy to our institutions, with which were able to attract massive investment from abroad through a comparative advantage in taxation and regulation. This is possibly the first time we have ever had a comparative advantage in anything, except maybe corsairing in the 17th century. Without membership, our lax rules lose their edge over even friendlier jurisdictions like Panama and the Bahamas, at least to the European customer.
So what has been the price of membership? With project funding and cohesion funds and cushy jobs for our boys in Brussels and Luxembourg, it's hard to see the cost of the European project. But the cost is real and enormous. For starters, there is the price we pay as net contributors to funding the EU, to funding the drug and booze parties in Brussels and the incredible waste and inefficiency of the bloated bureaucracy. To funding massive agricultural subsidies that create (literally) mountains of wasted food. To pay for translating miles of regulation into a myriad of languages, including ours, which no-one, not even our lawyers will ever read in that language.
The waste, white elephants and scandalous expense reports are only the beginning. The regulatory burden is also astounding. Miles and miles of regulation in the name of health, safety, the environment and social 'justice' ensure that in many sectors, the EU will be at a significant competitive disadvantage. All that aside, the main cost is exacted upon us by the second most reckless monetary policy in the world. The Euro was eagerly adopted as the Deutschmark for everyone. unfortunately, we have all been lumped with the Lira. Alas, not the Maltese Lira, but the Italian one. The reckless ZIRP and NIRP policies and bond purchase programs have generated massive inflation. No, not an increase in consumer prices (although that too), but the real and original definition of inflation as evidenced by reflated stock and property markets to bubble levels, record prices at auctions, and most importantly record levels of government debt.
Euro membership has allowed our government to borrow and spend much more than it would have been able to otherwise. And no, there is no surplus. GDP growth that is slightly higher then the current account deficit is not a surplus, the debt is still increasing. ECB and EU policy have incentivised massive government debt growth and deliberately fueled inflation. And despite the marketing campaign, 2% inflation is not price stability and is not good for us.
But again, do these massive costs outweigh the massive benefits of membership that we have successfully reaped? For the moment, no, but the trajectory is very disconcerting. With the British leaving, will that be remembered as it is considered now, as Britain making a fatal mistake, or will the near future make them look prescient? There are dark clouds on Europe's horizon. The EU was supposed to be, as Churchill put it, the "United States of Europe". At the time, the US was highly decentralised, before the war the government accounted for a tiny fraction of GDP and state independence was paramount and celebrated as the laboratory of democracy. Unfortunately, we do not have the United States of Europe, but rather an attempt at the Brussels Hegemony, or a rehash of the 19th Century Frankfurt Parliament. The Frankfurt Parliament is obscure today, as it was an abysmal failure to assimilate the various German, Austrian and Bohemian states into a single country though regulation and inter-state compromise.
Indeed, the focus is shifting away from Britain (who will probably only replace the mistakes in Brussels with problems in London) towards the EU's eastern and southern flanks. The ECB's massive irresponsible gamble has bailed out the PIGS, but should they try to normalise monetary conditions, they will soon discover (if they don't already know) that you cannot solve a problem of over-indebtedness with more debt. And no, they cannot stay this easy forever, as even official 'liar' inflation rates are now close to their mandate and heading much higher in a hurry. Unable to solve the problem of out-of-control inflation and bankrupt governments down south simultaneously, the EU will have a difficult choice; not dealing with inflation will eventually make the Germans (and to a lesser extent the Benelux) throw in the towel, but a rise in rates will force real austerity on the south, which will surely respond with Grexit, Spexit, Portugo and Ciao. In the latter case, the PIGS will find that their old currencies, thought they can be printed, cannot buy prosperity.
The financial apocalypse aside, there is a growing rift between East and West not seen since the rusty curtain. The East is showing signs of independence, unfortunately largely motivated by racism. The exit of Britain (or Brexit, if you will) has upset the balance of power within the union. Allemagne and Frankreich now have only Malta, Ireland, Poland and others (depending on the issue) opposing the Brexit response. This response is massive centralisation. We can expect an increase in the regulatory/litigational clampdown on Ireland's and Malta's taxation and regulatory independence. We might see rules aimed directly at tax and regulatory 'evasion' as the Franco-Germans bring der hammar down. this will negate the main advantages to our membership and leave us with only the costs. This policy might see the exit of some countries in the East but Malta will most likely go along for the ride and then it will be too late for me to vote no.
Dingle, Ireland 26th June 2018
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| At the edge of Europe on the edge |
TLDR: The European project is being betrayed by parastatists
