Globalisation or Regionalism?

Globalisation-1The EU says it is a firm believer in the benefits of globalisation:

While globalisation brings huge benefits and opportunities, it also means that Europe has to face increased competition in all traded goods and services.

Through globalisation, EU firms receive easier access to new and expanding markets and sources of finance and technology. EU consumers have access to a larger variety of goods at lower prices. And there are potential significant gains for the EU including higher levels of productivity and real wages.”

[from https://ec.europa.eu/info/business-economy-euro/economic-and-fiscal-policy-coordination/international-economic-relations/globalisation-and-eu-economy_en ]

Yet the EU is notoriously protectionist and the benefits of globalisation are not one-way. True globalisation would allow EU consumers to obtain the best products and services available from anywhere while helping its producers to specialise in those it does best. However, they want to make it harder to access the worlds largest finance market in the City of London. The above quotations pay lip service to the “benefits and opportunities” but it clearly isn’t sincere as they ignore the hardships that result from its one-way only version. We can fairly call this ‘regionalism’, which differs only in scale from nationalism.Globalisation-2

They are, in their familiar patronising fashion, dismissive of concerns that attention should be paid to the disadvantages that many people experience.

The public often associates globalisation with job losses and downward pressures on wages and working conditions. These anxieties are based on fears that increased competition from low-wage countries puts excessive pressure on local producers and workers and may result in the closure of factories in their country.”

The public’s anxieties are hardly surprising when most of the EU suffers high levels of unemployment, especially amongst the young. Something must be to blame. If they exclude Chinese products their consumers will pay above world prices for equivalent products. How would this improve productivity, innovation, wealth and growth?

Regionalism-1The leaders of the EU show no sign that they may be willing to concede the central goal of the project; the federal super-state, which in practice replaces petty nationalisms[EU growth] with petty regionalism. Few, if any, national leaders seem to be willing to challenge the ideology. Indeed many remain committed to it. Both sets ignore the lack of theory or evidence that might support the case for federation. And they wilfully ignore the evidence to the contrary; that in fact many citizens are not receiving the claimed benefits of the EU’s one-sided version of globalisation. As is so often the case with EU propaganda the rhetoric buries the truth.

Are far too many still unaware of the federalist goal? It has been well disguised under a snow-storm of politically correct pseudo-aims, such as:

A complete EMU is not an end in itself. It is a means to create a better and fairer life for all citizens, to prepare the Union for future global challenges and to enable each of its members to prosper.”

(See the Five Presidents Report for this and many other examples of the disconnect between propaganda and truth).

Repeated lieEconomic and monetary union is, in practice, an effective way to raise strong external barriers while declaring that it is a feature of globalisation. This is no doubt what they mean by preparing “the Union for future global challenges”; increasing the diplomatic and political power to resist competition. In reality, completing EMU is the objective; the juxtaposition with the desirables in the second sentence is intended to disguise this objective as something else, something unprovable and contradicted by experience. This lie has been repeated so often that too many otherwise intelligent people have come to believe it.

Distortion-1The distribution of the benefits of EU regionalism is uneven, distorted. Those who favour it are among the beneficiaries; they have paid too little attention to all those who have not benefited, and not just the losers.

Why are government revenues falling, or not rising sufficiently fast to enable them to maintain public services, if regionalism is so beneficial? Or is it beneficial for some and the rest can go hang? The slow growth, high unemployment and low productivity of the eurozone give us one example of how half-hearted approximations to globalisation, can go wrong. The result in the case of the EU is a regional free trade area with external trade barriers; a protectionist shell of complex tariffs and regulations.

Free trade-1Finding ways to offset the damage to those who lose their jobs or can’t find one is important. Finding ways to spread the benefits of freer trade is just as important – perhaps more important as these benefits may be more numerous – but this is largely neglected by EU mandarins.

Couple the rapidly growing wealth of a few, and the gently rising wealth of a few more, with ‘austerity’ and the widespread trimming of government expenditure, and we get the perception that a large and growing section of Europe’s population are, on balance, worse off. They see themselves as worse off than their parents’ generation and believe that their children will be worse off than they are. They are discontented. Some attribute this to ‘globalisation’ whereas it may more fairly be attributed to the blinkered regionalism of the EU.

EU growthThe EU economy has grown slowly, erratically and unreliably for three decades. This is surely because the economy’s importance is secondary to the political agenda and because its managers ignore economic realities. Since the eurozone was created almost 20 years ago cumulative growth in the UK has been 40% compared to 28% for the Eurozone (29% for Germany). Since the start of the financial crisis a decade ago the UK has grown by 10%, the same as Germany but double the eurozone average.

Those who most loudly proclaim that the European Union is a valuable project either have a personal interest in doing so or wilfully ignore its economic and social ineffectiveness. Or both of course. And they refuse to acknowledge, let alone discuss, the federal agenda that underpins the project.Rodeo-1

The EU project has a noble but poorly implemented economic ambition riding precariously and incompetently on the back of a powerful and out-of-control political machine (out of our control, the people). The central purpose of this EU is to create a supra-national government, secured at one remove from a critical electorate. This cannot succeed and should not be attempted.

 

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