Pascometer burns red on Brexit shock

Weoo, weeoo, weoo.

Bad news for the global economy. Pascometer has written Brexit off as meaningless thereby confirming the gravity of the the threat.

Reader Gunnamatta has done an excellent job of deconstructing the Pasconometric clap trap. Find it below. Pascoe begins:

I really don’t give a damn about Britain.

So I thought I’d add an opinion piece revolving around it to your day, given that I am particularly knowledgeable about things I don’t give a damn about.

It’s of minor importance to Australia, worth only a couple of percentage points of our exports. If the Poms want to shoot themselves in their economic foot by withdrawing from a powerful trade bloc, I don’t care.

What I do care about is filling up my opinion piece with sentiments about places I have told you from the outset I don’t care about.

But I do care about the isolationist small-mindedness that seems to have driven the Brexit vote; the shrinking vision, the reduced hearts and minds of what was once a rather grand outward-looking nation. The danger, as many have commented, is that it gives heart to similar xenophobic, anti-globalisation types.

Yes, anyone not entirely feeling they get a good deal out of the political mainstream as it has operated over a generation which has included the greatest financial collapse of all time (and the bailing out of an awful lot of large banks by taxpayers), the rise of managerialism and the embedding of conservative mantra as social policy (including rampant immigration without an accompanying overt policy on the economic need for this, or even a statement about how the immigration would even work economically, beyond ‘the more the merrier’ and ‘suck it up’) is………….a small-minded, small-hearted, xenophobic, anti-globalised bigot.

We should thank Pascoemeter here. He has gone to the very heart of the issue in one sentence. He supports unaccountable decisions made by the few being driven over the concerns of the many. 

More:

The same populist forces that swung the British public – that demonise migrants and, especially, refugees, that push a myth of a smaller, protectionist future being better – are at work here and more broadly in the world.

That’s a worry.

And never more so than during an election campaign revolving around two mainstream parties which do not want to go within a bulls roar of addressing Banks, Housing policy, immigration, the rights of foreign nationals to launder money in our real estate market, the rights of large corporates to employ foreign nationals when they don’t want to employ locals, widespread concern about the competitive aspects of the economy in the present and future, and the ability of that economy to sustain the highest privately indebted people in the world, let alone the need to tax the employees of the future to pay for the entitlements of those who own the houses of the present, while they are buying the same houses of those they are supporting with their taxes using the worlds largest mortgages.

The sense that those who think they are entitled to drive their solutions over us may not have our best interests at heart, and looking at this may get out of control once we start, so it is better is that we don’t even start. Is this what the Pasoemeter is saying? That we aren’t mature enough to have the discussion? That only spouting business journalists in heavily loss making media organisations who have the right to ask questions?

Should we ask questions about the possibility the entire global financial system has completely mispriced the possibility of Brexit? Are you going to ask that question or are you just going to hector us about being small minded bigots?

Many of the protagonists know no better. They are people with minds closed to the reality of the world being made a better place by maximising engagement, by welcoming differences and enlargement. There are others, the worst of them, happy to exploit ignorance for their short-term advantage. It sells newspapers. It can win an election. It can give an aspirant power.

Is Pascoemeter suggesting that many of the protagonists are know nothing small minded bigots, so it is best to assume that all of the protagonists are small minded bigots, and refuse to address any of the issues raised by those questioning the status quo?

Is he suggesting that the only people raising concerns about such issues as…..

  • money laundering in real estate,
  • the level of immigration running at 4 times the thirty year average,
  • the use of primary school visas to support an entitlement by foreign nationals to buy residential real estate,
  • the overcrowding of our infrastructure,
  • the widespread evidence of malpractice by our financial system,
  • the margin generation practices by our corporates
  • the use of foreign labour and 457 visas
  • the complete lack of an economic narrative about where this country is going
  • the complete avoidance of discussion why we have the most expensive houses in the world, or that we have
  • millionaires claiming welfare payments on the basis of not having their own home calculated in the entitlement deliberation, while we have young families paying life deforming mortgages for a roof over their heads
    etc etc etc

….is only coming from small minded bigots or those seeking some sort of power advantage (notwithstanding that our mainstream parties are united by a fierce desire not to have most of those issues arise at all during the longest election campaign in a generation) or seeking to sell newspapers (notwithstanding that there are only two sellers of newspapers – his outfit and Uncle Ruperts – and that they are both losing money hand over fist, both desperate for revenues, both clinging desperately to the banking and real estate advertising spend, and that this is supported by the very factors that our mainstream politicians and press don’t want to discuss).

Is this what Pacoemeter is suggesting? Does Pascoemeter ‘get’ that any other interpretation of phenomena happening in this world is possible other than that he has a vested interest in criticising?

The ignorant still view the interactions of nations as zero-sum games. They don’t grasp that globalisation is a win-win process, that the sum of our individual nations is indeed greater than the parts. They are blind to the lessons of post-WW2 Europe and the post-Cold War world as greater internationalism was embraced across trade and human movement.

Is Pascoemeter suggesting that we don’t engage with ignorance and educate it, but we should ignore it, that we don’t discuss the issues the ignorant are ignorant about and talk them through their concerns, but deny them that discussion? That we ignore the ignorant? And who decides when they are ignorant or not?

Lets explore that Pascoemeter hypothesis some more. If the interactions between nations are not zero sums games are they 100% win-win? Or could they be 70% win-win and 30% zero sum?

Or if they are win-win at a national level does this mean that not a single individual in those nations ever loses, or that somehow the decisionmaking processes within those nations send the winnings to one section of those nations while other sections of those nations may experience a diminution of their winnings (we could put that in small print – maybe it is already in small print in one of those trade agreements we don’t get to look at before our politicians sign them on our behalf).

Do those suspecting that they may not be getting any winnings from the interaction between nations game have a review mechanism? Can they raise concerns? (or are they ignorant and should be ignored?).

The lessons of post WW2 Europe were about making sure that everyone gets a piece of the pie. The lessons of Brexit (and the general post 1980s experience) is that many feel they no longer are, and that those who used to make sure that all people were getting some slice of the pie are now welcoming suitcases full of cash carried into town by someone they know nothing about. Does that greater internationalism embrace have any downsides Pascoemeter? Or is it only upside in your Panglossian world?

The lack of confidence in a nation’s ability to absorb migrants, to compete in a wider world, is a little sad. In the end, that’s what Brexit was really about.

The saddest thing is that if the benefits are so obvious and manifest then the selling pitch has faltered somewhere. Is it a lack of confidence in a nations ability to take migrants or a lack of being able to see the point, if all it does is overcrowd infrastructure, contribute to higher mortgages, and welcome dubiously acquired capital flows that nobody wants to talk about? Is it an inability to compete or a suspicion that all that extra competition isn’t actually doing much for the day to day experience, Pascoemeter? Or that the benefits of all that extra competition are going to people sitting in nice offices with nice views telling us what we should think, while the mugaccinos are increasingly frothy?

There are people in most countries that feel that way. Weak leadership either feeds on or gives in to their fears. Strong leadership resists the ignorance and actually leads rather than follows the fear-mongering minority. Domestically, there is a duty to educate Australians about the massive rise in living standards we have achieved through embracing globalisation and migration.

Did those miniscule looking mortgage payments of the past provide greater satisfaction than the ones being serviced now with extra hours in the health care sector looking after the mortgagors? As for your thoughts about leadership should we get in touch with Vladimir Putin? There is not an issue he will not discuss with his people, and there seems to be loads that our politicians don’t want to talk to us about.

Finally if Australians haven’t been educated enough about the dramatic rise in our living standards (sufficient to feel they have had one – maybe they got one of those dodgy private courses) should we wait until they have been or should we ram some more down their throats while they still don’t get it? Please tell us, oh strong one!

The world’s markets are suffering a knee-jerk reaction to the UK’s vote to be smaller. The actual decision doesn’t matter much to the rest of us, as long as the knee-jerk itself doesn’t upset fundamentals.

Dear Pascoemeter, you are a business journalist. Why don’t you ask your local bank about their cost of capital? Is the potential dismemberment about the worlds second most used currency a fundamental in your view? And if it does upset fundamentals how well positioned is the Australian economy, how well do our uber sized debts (to pay our uber sized mortgages) look as a servicing requirement at that point?

When the immediate shock passes, it will take some years for the UK to extract itself from the European community. The Scots and even the Northern Irish might reconsider their positions and the UK could further shrink. Doesn’t matter to me if what was once a global power becomes a less relevant little island off the coast of Europe.

Under Article 50 of their treaty it needs to be done in less than 2 years (Google mustn’t be working at the Pascometer offices). The Scots and Northern Irish are almost certain to reconsider their positions. Do you think this could have any international effects? (which may affect fundamentals, such as the Pound Sterling, still one of the 5 most used global currencies). Do you think it may impact on the way the EU deals with people remaining within its aegis? Or the companies they control? Do you think that the EU may become a little more focused on making sure that the people of the EU see their win, and maybe less on ensuring that their counterparties also get a win?

Could the small minded people inside the EU, or anywhere else for that matter, now see their elites paying extra special attention to them getting a slice of pie and explaining it to them real well? If all those elites were to go that way do you think that our elites may go the same path or do you reckon they would continue to avoid addressing the day to day experiences of the punterariat a little longer? Do you reckon we (a nation capable of engaging with the rest of the world in nothing but the exchange of dirt) are likely to be more or less significant than the UK (home of the worlds largest financial centre, with generations of capital management expertise) given that we are even further off the coast of anywhere?

But this caving in to populism in having such a dangerous plebiscite, this lack of leadership, should be a warning to others not to let the lies and myths of the xenophobes and small-world types go unchallenged. The steps backward to a greater degree of tribalism, of embellishing nationalism, can be a siren song for the power-hungry.

What, so there are no power hungry in the new globalised win-win world? Is explaining things thoroughly to a people really that dangerous? Wouldnt your real power seeker want a piece of that bigger connected power, especially if there were more people to dilute the downsides with? Shouldn’t those lies myths and xenophobes be addressed with rational discussion? Are you saying they should be ignored?

Samuel Johnson said it first: Patriotism is the last refuge of the scoundrel.

Yeah, and La Rochefoucauld rightly noted that silence was often contempt.

But all that said, somebody had best start thinking about the here and now, for the end of cycle shock. Houses and Holes often refers to is here and all the certainty of the Pascoemeters world is going to be swept away….

Comments

  1. St JacquesMEMBER

    Brilliant dissection of this complete tosser Gunna. His attitude and righteous special pleading reminds me of the French aristocracy just before the revolution “Who gives a stuff about the scum who have to work to live and are seeing their wages and conditions and chances of living a full, normal life being smashed by the deluge of immigrants and visas holders, F-k them! The more desperate they are, the more us property speculators, slum lords and banksters get ahead!” Pascoe, the total tool.

    • A fascinating analysis of where the main density of Vote Leave occurred in the UK shows a high correlation between old Labour heartlands full of long term unemployed, and very high levels of support, suggesting strongly that many people in these areas accepted that in or out would make little difference to their plight, so they relished the chance to ‘stick it’ to an Establishment responsible for decades of political failure. Democracy did indeed prevail, but its main objective was to say to P’Cers, Thatcherites, Blairites, Neoliberals and other misguided ideological High Priests, “You have failed”. Every fresh hope for a brighter British future since 1975 has been dashed. And all the while, the more the great Neoliberal experiment turned out to be alchemy the more it was praised to the Heavens. The more people went to University, the less likely they were to have a job, and the more the “recovery” was declared to be on the way, the further away it got. Political waste and incompetence – and Westminster’s 0% awareness of responsibility for it – had removed hope from the lives of vast swathes of Britons.

      (John Ward)

  2. moderate mouse

    Glad I stopped contributing funding to the MacroBusiness circle jerk last year. This shit takes the cake. Cheering in Brexit…FFS. What’s next…….Hanson for PM?

    • GunnamattaMEMBER

      Brexit: Why I tend to be supportive of it, even if I don’t think it will necessarily deliver the outcomes those voting for it may want

      OK, the rant I posted on the Brexit thread the other day may have seemed a tad Libertarian, and I am doubtful about what the Poms may do from here. But what I support, and will continue to support, is the right of peoples anywhere to voice their grievances. If that voice is cornered into a position where it is voiced in a form which looks to many like small minded xenophobia, or is suppressed and unheard, then I would always take the voice. Suppression is subjugation, subjugation is denial and totalitarianism.

      Focus on the punters and their malcontents

      Let me say from the outset I too am doubtful about Boris Johnson and Nigel Farage. But just the revolt they have led will tie them more closely to those who have voted in favour of Brexit, than those whom they have beaten were to a nation which has genuinely surprised both its leadership and (more disturbingly) the global financial system – I actually suspect the least surprised were those at the core of the EU, whom I am reliably told looked at the early result from Newcastle and knew they had major, major problems, well before the result was beyond doubt.

      I buy the line that the voters for Brexit were the less educated, the poorer, the older and the most ‘threatened’. What I find myself wondering is why those in power with the funds and with the access to address the education, the poverty, and the ‘threat’ didn’t pick it well beforehand and address it (for a fraction of the cost it will now incur). OK if they have voted on issues associated with immigration, then that is distasteful, but that vote should be considered in the context of how much power they have to deal with it and what that immigration means to them in their eyes. It isn’t as though the Brits haven’t taken countless millions of migrants, is it? I played cricket in the UK in teams composed of almost nothing but Pakistanis and Indians, and I worked in places (including banks) where everyone was from somewhere else. It isn’t as though there isn’t a long history of migration into the UK which has ultimately panned out just fine. If migration is the issue there is something about this particular type of migration as it has been experienced in the recent past or currently, which is aggravating it. It isn’t immigration per se. I think the claim about anti-immigration being the basis for the Brexit vote is a convenient front (even where it has been voiced by Brexit voters themselves), for not delving into (and addressing) a whole range of social issues which may have been impacted by immigration, but which the body politic hasn’t wanted to touch, or hasn’t thought was significant enough to address.

      The vote was about economics primarily

      Mostly I see it revolving around poverty. If not direct poverty of people, then the risk of poverty, and the poverty of opportunity for people to address their circumstances. You can see a lot of it in the UK. I lived there two years more than 20 years ago, and was surprised then at just how accepting the British were of the poverty in their midst, my regular trips back never brought me to the view they were doing something about it (even at the peak of ‘Cool Britannia’ you only had to go somewhere outside London or the centre of the newly gentrified centres of larger cities to see very confronting poverty). From there I tend to see the Brexit vote as simply an avenue for expressing public discontent about poverty. The migration issue (such as it has been played) has essentially been played along two avenues – migrants compete for jobs (particularly semi skilled or unskilled jobs) and tend to have the effect of suppressing wages, and migrants represent a further social welfare spend requirement (and in the UK it is a pretty parsimonious spend). Ultimately the immigration (and I certainly don’t think all/most Brexiters voted on immigration grounds) functioned as a subset of economic policy. And it is here that the UK body politic has failed, and that (most importantly) the EU has shown itself to be utterly powerless to provide a better economic backdrop for its people over the last 10 years (at least), if it is not a genuinely worrying socio-economic threat in its own right.

      I think the Brexit vote revolved around economics, was the first remotely plausible opportunity many Brits have had to deliver a message about economic policy as they receive it in a very long time, and was rightly identifying that the EU has been a spectacular economic failure for many people living there, and has shown itself as an institution to visit financial and economic hypocrisy on an epic scale (to the people of Greece, to the savers of Cyprus, to the workers of Spain or Portugal, or the taxpayers of Eire for starters – but in countless other ways – in the interests of upholding the rights of bondholders and mainly German and French banks, against the backdrop of EU monetary policy serving Germany first and other parts of the EU second). And it is that right to protest that I support entirely, unreservedly. Against the backdrop of a world which has increased the take of the 1% for more than a generation the real tragedy of the Brexit vote is that nobody has gone to that 1% and suggested they need to reverse their take or there are likely to be societal consequences, and that not addressing these concerns is, beyond a certain point, laying the basis for protest, for revolt, and ultimately for some serious ugliness. Some sort of deal could have been nutted out which would have cost far less than the trillions being wiped off markets as those markets reprice the possibility of policy and social revolt.

      Epic level cock ups

      I think there are two epic level political cock ups underlying Brexit. The first was that the British body politic would offer a referendum on a foreign affairs or powers of Westminster v Brussels issue without realising it would be primarily (in the context of mainstream bipartisanship on most economic settings in the UK – invariably revolving around conservative trickle down economics based on discredited DSGE and efficient markets thinking) used to deliver an economic message by people who don’t usually get the chance to throw a political spoke in the policy wheels. The second was that the EU (of any organisation!) which could conceivably not get that this would be the basis of the response to them. Do the players of the EU think that the Pom Brexit crowd are likely to be any less charitable towards the EU than the unemployed of Spain, or Italy or even France, or the savers of Cyprus, or the taxpayers of Eire?

      Where to for the Brits?

      I don’t think that Johnson is, in a social, or underlying assumptions context, any different from much of the UK conservative party. He is a privileged, self-entitled git. More to the point I don’t particularly doubt that he has picked up the Brexit (anti EU) idea as a source of personal power for him (his path to the British Prime Ministership). But he at least has picked it, he has identified that it was a phenomena that was there, and that it was of a magnitude which was significant. The vast bulk of other self-entitled gits in the echelons of British politics (both sides, the British Labour Party is every bit as prone to Euroscepticism as the Tory side) and the British corporate world (or ‘the establishment’ as it likes to think of itself) are obviously so isolated from the punterariat in the nation they run as to not even get that far.

      But if Johnson now assumes power on the basis of Brexit, then he has to deliver outcomes to the people, who have voted in protest for Brexit. And the party he (will?) lead, and the Labour Party in opposition if it wants to return to power, now must deliver outcomes to those people, or run the risk that they will be the next political emasculation. The corporate world in the UK will now find itself revisiting a lot of assumptions (starting with the cost of funds – the most massive cock up of all must surely be the complete and utter failure of global markets to price the Brexit risk) and possibly even working harder on delivering an outcome (or possibly selling an outcome they already provide) about jobs, about skills about remuneration and living conditions for the ‘stakeholders’ they have ignored for a generation – those they employ. But only if they get the chance, and given the path they now face that chance may not offer much scope for better outcomes. I agree completely that anyone in British politics will be profoundly careful about putting something to a vote again in the near (think decades) future – the memory of the Brexit vote will haunt politicians (and not just in the UK) for a long time.

      The example the EU needs to make of the UK

      Unfortunately for the UK (or the English and Welsh, because I suspect the Scots and Northern Irish will want out) the EU now needs to make an example of them, and it will try to do so. Sure, the Poms have their own currency and institutions, and that will help them to some extent, but the motivations of the EU will be broadly the same. Anyone wondering about the example which will be made need look no further than Greece, where the EU has shown itself perfectly prepared to trash life as the Greeks know it to preserve the EUs self-interest. But equally they could look at the way the Irish state was backed into backing Irish private banks when it was obvious they had ceased to be solvent, and the subsequent taxpayer impost stemming from that. Or they could look at the Cyprus bank deposit raid, or some of the chicanery around pressuring Spain and Portugal. While these were no doubt a significant factor in the distaste many no doubt felt for the EU (and I do tend to the view that the Brexit vote was ultimately about economics and the EU), they now become the starting point for negotiations between the UK and EU. The EU could shunt Varoufakis out the way and get a complete reversal of policy put to (and voted for by) Greeks, with the prospect of a return to the economic stone age. They could do the same in Cyprus. Now they need to send a message to a range of irredentist groups across the EU about the implications of voting out (or even trying) with a real model of a nation which has voted out – they need to send the message of there being no way out but the economic isolation and economic impoverishment of anyone trying (or even thinking) out. That is if one assumes that there will not be frantic negotiations to try and keep the UK in the EU in some guise, and therein lay the balance the EU needs to come to – do they try and retain some sort of sway over the UK, in some form of loose arrangement (and hope that nobody else wants it) or do they provide a living breathing economic example of the price to be paid for voting out? I reckon the latter will be the longer road, but I wouldn’t be at all surprised if something was at least tried beforehand.

      Presumably that will make the support they offer the Scots to vote out of the UK of particular interest. They can’t really offer them more than they are offering the Catalonians to stay in Spain can they? And if they try to encourage the Northern Irish to unite with Eire what are they offering? The chance to get taxed to support a bank bailout they never were part of, which reflected a housing bubble and population ponzi of the type they have voted against as Brexiters? The Scots have almost double the per capita sovereign debt of the English, how do they explain that to the Italians and Slovenians (inter alia) whom they have pressured about their sovereign backed debts? Or the people of Finland and Netherlands who tend to have pretty dry economics? Do businesses in Northern Ireland or Scotland relish the prospect of dealing with the Euro (essentially representing German-French economic exigencies) more than the Pound?

      With the English (and Welsh presumably) there will be lots of scope for the EU to pare access to EU markets, and hence to redistribute profits or revenues to businesses inside the EU, but ultimately if they do that what else are they paring access to? And what are they paring their own business to in the UK? It may become a real issue in the financial services world where London is without doubt the preeminent financial centre in Europe. It is probably the one area where the EU could feel significant pain. More disturbingly for the EU the sudden release of London from closer EU oversight now offers considerable scope for the UK (traditionally far less inclined to financial regulation than the EU, and far more inclined to rest on property rights – where it has a vastly superior framework than anything inside the EU) to become more of a home away from home for European banks and financial institutions and reverting to its strength as a capital entrepot centre (along with the financial services and specialities London has, which aren’t matched anywhere else on the continent) and offer unrivalled scope for London to continue laundering money of dubious provenance (or desiring less visibility) from within the EU.

      The issue for the UK from here is to somehow leverage what strengths it has into coming up with a plausibly better outcome for its people – sufficient that they feel less inclined to vote against the obvious preferences of the establishment and their political elites. That is precisely the outcome the EU cannot let them have, for if they do they encourage loads of others across the continent to vote down the EU. I am profoundly doubtful they can, but if they can keep their financial and legal system intact and work out a way to tax it sufficiently to produce politically better outcomes then they may be a show. They are unlikely to do it with the outdated financial models of a previous economic era which have lead the EU (and UK) into a form of zombie economics, where a housing bubble and uber private debt is held up as vibrant economic life. It is this (question and move on from their existing model and come up with something superior) that I don’t think the Brits will do. But I do think the necessity they now face of having to try something (for the economic status quo will crumble quickly if they don’t) will lead to some interesting policy. From there I tend to the view the EU (every bit as wedded to the same economic orthodoxy) will try to thwart anything that looks like it could be a success in the UK.

      The larger implication – it’s the economy stupid, always the economy & at what point do orthodox economics and ideas revolving around efficient markets actually get questioned

      Of course the economic issue is the largest implication of the Brexit vote – the whole financial system model has been held up to question.

      The Western world has run a model since the mid 1970s exhorting (and often pressuring other nations to adopt) the use of markets (on the basis that these are efficient or superior to anything involving regulation or direct control by interests concerned about anything other than capital return). This has been in the experience of most people the adoption of trickle-down economics, and of the increased perception of people as subservient to the interests of capital (through a focus on those people as customers rather than a balance between producers and customers), with the people often accorded a legal status in market economies akin to that of a chattel. Generally this has been without the slightest question being asked about the provenance of the capital, and how it has been acquired in the first place, and of what it may do in any destination it desires. It has been supplemented by the extension of debt which is generally priced solely to provide a return to those extending it, without considering other economic impacts (asset bubbles, intergenerational transfers, economic efficiency, production costs etc), and generally on the belief that markets simply don’t fail when it comes to pricing debt (regardless of the spectacular examples on offer around the world suggesting that it does, and does so regularly). Britain was central to the advent of that model, after the spectacular failure of Keynesian inspired economics in the mid 1970s, courtesy of Mrs Thatcher, and her successors (both Conservative and Labour), the big bang of the City in the late 1980s, and London’s preeminent position as a financial centre.

      Since the 1970s this has seen the increased concentration of capital in fewer hands across nearly all developed economies, all developing economies and in the former centrally planned economies. It has also seen the widespread indebtedness (both public and private) of whole societies, and the marked deterioration of the bargaining position of labour vis a vis capital. In many respects the UK has been at the forefront of this (probably surpassed only by the US).

      The limits of the model

      I tend to see the Brexit vote, and the rise of the Trump (and Sanders) phenomena in the US as political symptoms of the limits of the economic role model we have experienced for a generation.

      Currently that economic role model has an economic zombie of Japan and the EU, the economic marginalisation of much of the US, an ominous debt implosion prospect in China, the denial of some pernicious money acquisition processes across the developing world (from the Middle east to Russia to China and onto most of Africa and South America) and has devolved into the politics of impotence and shrill small (or non insofar as much of the electorate is concerned) issue bitterness across political spectrums around the world. In Australia it has seen the marginalisation of the young (and I reckon young in that sense is anyone younger than about 50) and the stripping of economic vigour to facilitate a housing bubble and debt explosion. That model has ceased delivering real outcomes in many nations some time ago, and replacing the real outcomes have been spurious and specious words – by politicians, by corporate elites, and those who have a position ‘at risk’ from any process of looking at new models. Many of the elites who have come to power in the age of this model and whose power is deeply embedded in the functioning of this model, have no other intellectual answer, and lacking any other answer need to suppress questioning of the model whatever way they can. That of course leads to the voice dispossessed, and loads of politically unacknowledged messages, which can’t really do anything to get addressed but become more and more obnoxious (and where they do become obnoxious they enable the state to openly crush dissent one way or another).

      The near death experience

      That economic model has had one near death experience in 2008. Since that time it has been living on life support as central banks have delivered transfusion after transfusion of cash into the system to keep it viable or plausible – even though most observers have long thought it less plausible than the politburo standing on Lenin’s tomb in 1983. Like the Soviets of that era the system runs long on an ethos of ‘the system is eternal and there is no other’. Unfortunately those transfusions being pumped into the model since 2008 (at least) have been haemorrhaged out as easy money for those with access to debt, and these have in turn have haemorrhaged it out again on asset bubbles (notably real estate) rather than doing anything much productive with it – mainly representing the informed fear that a generations worth of debt saddling has curtailed the worth of investment in productive endeavour, and making speculative gambling on whatever asset class seems doable a less risky venture. They have been able to do this because the model they are doing it under sees regulation (particularly financial regulation) as anathema, and is wedded to the idea that where there is money it will do the most efficient thing, which in turn is always to the best interest of the society in question. The idea that money provision wouldn’t ‘work’ in terms of delivering better social outcomes wouldn’t enter the head of those exhorting the model. The idea that large sections of society have missed out in some way must surely represent, for these people, the idea that there is something ‘wrong’ with those who have missed out. And so it is here – Those voting Brexit are wrong, uneducated, anti globalisation, racist lowlives many of the commentariat would have us believe.

      The Brexit vote and the repricing

      The Brexit vote has delivered a message to those living at the limit of that model. It has raised the bar for those looking to continue the operation of the model inside the UK, and will deliver a warning to those seeking to extend the model in the EU (as well as raise the costs for them). More disturbingly it puts the rise of Trump (whom I loathe) into a context where it may make sense to many people in the US to vote a nutter into the White House, rather than a scion (Clinton) of the model as it has run for a generation (particularly where she is the very embodiment of the sort of speciousness and glib literality of the type which people around the world have increasingly been seeing in their political elites as the model has ceased to deliver economic outcomes).

      But perhaps the most truly spectacular outcome of the Brexit vote, is in the complete misreading of the sentiment and issues at play by the global financial system. The Brexit vote requires the entire political economy of the globe to be repriced (as it will be in waves of volatility over the coming weeks and months). It surely will lead in the coming days to a complete repricing of the Trump phenomena. Indeed it must invariably lead to a repricing of the possibility that many of the underpinnings of the model which has run for a generation will be revisited, when the hitherto assumption was that they never really would be (often because there was no political vehicle to carry that sentiment). More disturbingly for the EU it now must invariably lead to the repricing of EU related risk, or the costs involved in ensuring that the ruling elite there don’t get called out this embarrassingly again. For at the end of the day this was a nation which has voted against being a member of the EU, when the elites of that nation, and the elites of the EU assumed the benefits of the EU tie for the UK were obvious. Brexit implies a repricing of the obvious, which means a revisiting of almost everything in an economic policy sense.

      The cojones and the Poms

      For that reason I support the Brexit vote. I support the rights of people who do not believe their leaders listen to them, or who do not believe their leaders address their circumstances, or do not provide them with much of a choice in the address of those circumstances, or even (in the worst case) hold their hopes of addressing their circumstances to ransom, for a rent, to do whatever it takes to have their issues addressed. Regardless of whether the vote will be a step towards a better future for the Brexit voting Brits, I admire their bravery. I admire their cojones in facing up to an elite which has told them repeatedly that they either ‘suck it up’ what they are given (or what they aren’t given) or face a dire alternative, and saying to that elite ‘we will take the alternative’. Yes I think they are taking an enormous risk, but I think the world has reached the limits of the economic model we have run for a generation and needs to start taking some risks. Regardless, I think that the process of repricing and revisiting policy assumptions which I think will flow on from Brexit will lead to a greater focus (or pricing analysis) of the circumstances being experienced by many who have been marginalised – and I think that offers scope for the improvement of the lives of the many (no matter where they are) rather than the 1% who have soaked it up for a generation.

      Gunnamatta 25 June, 2016

      • moderate mouse

        Be under no illusions – this is a triumph of the Hard Right, not some Fourth Way revolution. Two-thirds of Brexit voters identify as Tories, so talk that this is a working class revolt are overblown. Oldies voted 2-to-1 in favour of Leave, while only 1 in 4 18-24 year olds wanted out. Only 30% of Labour voters voted Leave (yet the Gillards and Shortens of UK Labour are still blaming Corbyn for the result and sharpening their knives…go figure). Vulnerable people were lied to by Pied Pipers who threw away the dog whistles and picked up the megaphones to drag the Leave vote across the line – and already they are reneging on promises of more funding for the NHS. Simple solutions don’t fix complex problems – and blaming immigrants for your woes is the oldest trick in the book. What a joke.

      • If this is a victory of the hard right then how badly did the left f#ck up over the last 30 years with their pro-corporate thin-skinned bed wetting?! Chew on that

      • Very true MM.

        What upsets me is that people who have very real grievances have been persuaded that their plight is due to the EU and migration, when really it is due to the neoliberal policies of all governments since Thatcher … this vote won’t deliver any resolution to them, but actually puts them right into the hands of the very people that are pushing the country more to the right. Johnson, Gove and Farange.
        There will be no improvement here and for most of those in need it will get worse. It was EU money that rebuilt Liverpool, it is EU money that supports local projects. Will the Tories replace those grants with money saved from the EU dues ? Will they fuck …

      • “. It was EU money that rebuilt Liverpool, it is EU money that supports local projects.” 10 years ago? Noticed any EU money going anywhere but banks recently? Wake up and smell the 2010s! EU money completely fucked Greece, Spain, Portugal, Ireland, Italy. Nobody voted for Farange, they had that chance months ago! Your also forgetting Farange was a MEP for a decade! So the EU created Farange, but that’s a mirror too far for you pro institutionalists

      • St JacquesMEMBER

        You cannot have an endless tsunami of desperate people who’ll do anything flooding in without upsetting the socio-economic balance of the country. Basically, the neoliberal Thatcher set and their ordoliberal European Union counterparts and basically the global elite said to the working and now the middle classes – so long as this contributes to speculative and rental increases and exponentially growing bank profits FU !!!! Look at Europe, a huge percentage of the latest wave of immigrants flooding into Britain are coming from the countries that have been afflicted by the crisis produced by the bubble collapse in Ireland, Spain, the Baltic states, and the endless austerity medicine being forced on them. The bubble was fuelled by the low interest rates of the Eurozone. The result of this disaster, and their betrayal by the simpering faux left is that these people are turning to the hard right and if this chaos keeps going, they’ll finally turn to fascism

      • St JacquesMEMBER

        Let me one last point: the very design of the EU means solving these problems from within its anti-democratic, ordoliberal foundations IS SIMPLY IMPOSSIBLE. There can only be bandaides until the whole fuken utopian wet dream explodes.

      • St JacquesMEMBER

        And before I say au revoir and adios, I’m not an anti-European; I hold a European passport and most of my family live not far from where our ancestors have lived for millennia.

      • Yes Gunna some confuse the EU with progressive sociopolitical and economic policy when in reality is Ordoliberalism, which imo is actually a stronger brew than the American neoliberal variant, but hay, good social PR has been historically shown to overcome such nuances….

        Can’t find the rational for arguing against TTP et al because of sovereignty issues but borders and immigration influx is a whole different kettle of fish. Not that all the actions over some decades by the elites in far away country’s have primed the pump wrt refugees and those with a bit of dosh seeking safe haven…. especially when its more than likely to get worse….

        Disheveled Marsupial…. Don’t see it…. right wing thingy… had Corbin pushed the referendum the outcome would have been the same…

      • bolstroodMEMBER

        Thanks Gunna, for the disection of Pascoe & the obitury of Neo-Liberal philosophy.

      • “only 1 in 4 18-24 year olds wanted out.”

        Of those who voted. And the proportion of youth that voted was lower than that of the oldies.

    • Because cheering in Bremain is what, soooooo leftillectual? The whole of the EU will fall apart under the weight of the arrogance of nobodies like you, who assume that everyone just has to go along with your lefty mega-institutions, even though you refuse to provide even one clear compelling reason for your love of technocracy done wrong!

      All I’ve heard on this site and others is that the EU stops war in Europe. Utter BS, American bases all over the continent do that, but NATO might just pick a fight with Russia…. Lefties…. Always the same sh#t, blame everyone but yourselves because your ill conceived projects fall apart

      • How to make money from the forthcoming European break up!
        “Maxim was reported to have said: “In 1882 I was in Vienna, where I met an American whom I had known in the States. He said: ‘Hang your chemistry and electricity! If you want to make a pile of money, invent something that will enable these Europeans to cut each others’ throats with greater facility.'”[18]”
        https://en.wikipedia.org/wiki/Hiram_Maxim

  3. Seems like there still is a long way to go for an actual Brexit to happen!
    “http://indy100.independent.co.uk/article/people-are-really-really-hoping-this-theory-about-david-cameron-and-brexit-is-true–bJhqBql0VZ”

  4. Can’t wait for the institutional left on this site, who never fail to mention how cheap they are (I have two active subscriptions) to tell us how a yes on SSM is “make no mistake about, a win for the hard left, we’ll all be married to rabbits soon”….

  5. I’d highly recommend to Mr. Pascoe learning a bit more about “the isolationist small-mindedness that seems to have driven the Brexit vote”. The documentary below would be a good starting point to learn about the progressive EU model of democracy in which the so called European Parliament does not have legislative initiative unlike a bunch of nominated bureaucrats forming the European Commission https://www.youtube.com/watch?v=UTMxfAkxfQ0

  6. I’ve been shocked at the vitriol in the media this past while. Every leave voter (and anyone who dares criticise the same neoliberal/globalist immigration regime here) is now branded a racist, or if they’re not white, some kind of uncle tom pulling the ladder up behind them.

    Unrestrained immigration has pushed existing infrastructure beyond limits and made the welfare state untenable. This has nothing to do with race and everything to do with living standards being eroded for the sake of making elites richer via lowered wages and increased sales. Let me be clear: the people benefiting from mass immigration are Gerry Harvey and Harry Triguboff. If you aren’t in their circles then you’re the chump paying the bill.

    As has been stated on this blog many times, the “left” is just as responsible for this result as the “right’, so to blame the cryptofascist lunatic fringe for this is a bit rich. Let’s not forget that Labor, the supposed party of the working man, is the one that deregulated the banks and opened the FIRB floodgates. The party of the working poor has no policy with regards to curtailing immigration to Australia, the highest per capita out of OECD countries. The Greens, the party of the environment, does not seem to care that importing millions of new people will be the most effective way to destroy the environment they pay so much lip-service to. Green power will make no difference when we’re running out of fresh water and arable farm land that hasn’t been sold off to provide food security for other nations.

    Why is it that things need to get bad before a country is finally motivated to look after itself? Why not simply have a policy of taking care of your own shit first, ala Norway or Switzerland?

    The race card has been played so many times now that it is becoming meaningless. The media calls Trump and Farage fascists, but all they do is forment the very-real grass roots movement behind them.

    • I watched Brexit the Movie last nite Tony…..

      A thoroughly eye opening documentary.

      And guess what ?

      Nary a mention about immigration, borders or refugees fleeing flooding into Europe.

      Who woulda thought ?