May 22, 2019

Brexit Leave voters: Don’t give in to Establishment pressure

brexit flagsU.S. markets continued to sell off Monday, with the Dow falling over 300 points and the S&P down over 2%. Global elites are blaming Brexit, the referendum last week in which United Kingdom citizens voted to leave the European Union. Opponents of the “Leave” movement predicted a market crash and are now wagging their fingers, saying “I told you so.”

They’re also accusing the Leave campaign of going back on its pre-referendum promises, reporting that over one million Leave voters now want to change their vote to remain, and continuing the narrative that Brexit was nothing more than a racist, xenophobic reaction against immigration.

Leave voters should expect their convictions to be tested nonstop until the break with the EU is official.

As I wrote just after the vote, some of the same scare tactics were used against the American people in the wake of the infamous TARP bill failing to pass on its first vote. American voters had deluged their representatives with angry phone calls, emails and letters warning against a vote in favor of the $700 billion bank bailout. On September 24, 2008, George W. Bush made an impassioned plea to the American public to support it.

If TARP didn’t pass, warned Bush, the markets would crash and Americans would lose a large portion of their retirement savings.

Pressure from voters relented and TARP passed on the second vote. But equities markets continued to crash, losing an additional 20% of their value after the bill passed. A prolonged recession followed, from which we arguably have never recovered.

That’s what comes of believing politicians when they claim that only giving them your money can save you. Let it be a lesson those under pressure to change their minds on Leave.

There isn’t much doubt a referendum of this magnitude would cause some uncertainty in financial markets. Uncertainty usually results in selling. But any attempt to blame a prolonged crash or recession on Brexit should be seen for the scapegoating it is. If this a major correction, it’s the result of a bubble that’s been looking for a pin for years, blown up by unprecedented inflationary policies by central banks all over the world.

On this side of the pond, the federal funds rate target for the Federal Reserve remains at .038%, following seven years targeting zero percent interest rates. This is the stuff the 2007 bubble was made of. Brexit now provides an excuse for the Fed to continue to inflate, something it was going to do regardless.

240 years ago, Thomas Paine wrote the following to Americans wavering in their support of our own secession from Great Britain:

“THESE are the times that try men’s souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands by it now, deserves the love and thanks of man and woman.”

Americans maintained their resolve in the face of a mighty empire waging war against them on their own soil. In 2008, faced only with the scare tactics of an unpopular president spouting economic gibberish, we folded our tents and gave in to the crony capitalist establishment. We’re still paying for it.

Stand firm in your resolve, Leave voters. What you’ve done is hated by all the right people, who don’t have your best interests at heart. Proponents of freedom the world over are looking to you for inspiration. Don’t let them down as we did.

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

Brexit: Hated by All the Right People

1200px-Flag_of_the_United_Kingdom.svgAs global equities markets tumble and gold soars, the world outside the United Kingdom tries to make sense of just what our British cousins did last night. There are many narratives. UKIP Leader Nigel Farage is calling it “our independence day.” U.S. presidential candidate Donald Trump says it’s a precursor to his own election in November. Many opponents are dismissing it as a racist backlash against immigrants and refugees.

Maybe it is a little bit of all those things. Maybe it is something else completely. Whatever else it may represent, one thing is undeniable for opponents of central economic planning, giant international bureaucracies and global crony capitalism: Brexit is hated by all the right people.

One doesn’t have to be an expert on European politics to instinctively understand that if the governments, the central banks and all their connected crony capitalists are howling there will be Armageddon if you do X, it is virtually always in your best interest to do X.

And howl is just what they have been doing, with a nonstop campaign to scare the daylights out of British voters should they consider withdrawing their consent to Brussels. As MEP Daniel Hannan pointed out, they haven’t been unwilling to just make things up in their desperation to intimidate the people into a Remain vote.

As an American, I can’t help thinking about George W. Bush’s scare-tactic speech to convince Americans to support TARP back in 2008. Public outrage had sufficiently worried Congress to vote against the bill the first time around. Bush’s speech, littered with many of the same pseudo-economic canards thrown at British voters today, convinced enough Americans to relent that Congress eventually felt safe ramming it through.

This time, it didn’t work.

For those dismissing the vote as the kind of “nativist” bigotry they say inspires the Trump movement in America, there is that inconvenient other little fact that the UK is the second largest net payer in the EU, next to Germany. Critics of the EU predicted, long before the rise of Nigel Farage, Donald Trump or Marine Le Pen, that the EU would fail when the net payers grew tired of subsidizing the net payees. British citizens just confirmed their prescience.

Ironically, the “nationalist” movements sweeping across the West are the precise opposite of nationalist movements in the 20th century. Then, nationalism was a centralizing force, antagonistic towards local government. Now, it’s a decentralizing force, taking economic and political power away from larger political units and returning it to relatively more local ones.

What it is not is necessarily a conservative, liberal or libertarian movement. Individual nations and even the local cultures within them have myriad visions for what they believe society should look like. The Trump movement longs for traditional conservatism, with its protectionist tariffs, government-funded infrastructure and restrictive borders. The secessionists movements in Vermont and Quebec, Canada sought to create socialist societies. And the “Texit” movement, well, they just want to be Texans.

Neither will Brexit be a panacea for all British ills. It is likely they will make mistakes in the short term, like most secessionist movements have in the past, including the Americans in 1783. But it will be Britons making their own mistakes and living with the consequences, something they have now demanded their right to do.

Whatever Brexit ends up looking like in the short and long terms, one can’t help remembering a night 27 years ago, when the people in a city in Germany decided they’d obey their masters no longer and knocked over a wall. Oh brave new world, that has such people in’t!

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.