The Divi­sive Vote Over Brexit

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Andrew Watt has writ­ten a pas­sion­ate cri­tique of my sup­port for Brexit (“Pro­gres­sive econ­o­mists should sup­port Remain not Brexit – a response to Steve Keen”), and it high­lights a key fea­ture of this pecu­liar ref­er­en­dum: peo­ple who nor­mally find them­selves on the same side in most eco­nomic and polit­i­cal debates have been divided by this ref­er­en­dum.

Andrew com­ments that he broadly agrees with my eco­nomic analy­sis on most issues, but vehe­mently opposes me here. Like­wise, good friends like the het­ero­dox econ­o­mist Geof­frey Hogdg­son; Ann Pet­ti­for, who led the suc­cess­ful Jubilee 2000 cam­paign to can­cel the debt of the world’s poor­est nations; and Yanis Varo­ufakis, who knows a thing or two about the EU, all strongly sup­port Remain.

But many other eco­nomic col­leagues, such as Richard Werner, sup­port Brexit as I do. Richard states his posi­tion this way:

The eco­nom­ics is clear: there is no need to be a mem­ber of the EU to thrive eco­nom­i­cally, and exit­ing does not have to impact UK eco­nomic growth at all. The UK can remain in the Euro­pean Eco­nomic Area, as Nor­way has done, or sim­ply agree on a trade deal, as Switzer­land did, and enjoy free trade – the main inten­tion of Euro­pean agree­ments in the eyes of the pub­lic.

The pol­i­tics is also clear: the Euro­pean super­state that has already been formed is not demo­c­ra­tic. The so-called ‘Euro­pean Par­lia­ment’, unique among par­lia­ments, can­not pro­pose any leg­is­la­tion at all – laws are all for­mu­lated and pro­posed by the unelected Euro­pean Com­mis­sion! As a Russ­ian observer has com­mented, the Euro­pean Par­lia­ment is a rub­ber-stamp­ing sham, just like the Soviet par­lia­ment dur­ing the days of the Soviet Union, while the unelected gov­ern­ment is the Euro­pean Com­mis­sion – the Politibu­reau replete with its Com­mis­sars. (Richard Werner, “EU Basics – Your Guide to the UK Ref­er­en­dum on EU Mem­ber­ship”)

How can one issue divide peo­ple who are in agree­ment on so many oth­ers? Partly it’s because of the polit­i­cally ugly fel­low trav­ellers one finds one­self with: the UKIPs and the Britain Firsts that put for­ward racist, anti-immi­gra­tion argu­ments for Brexit. Bet­ter vote Remain than find your­self with such bedfellows—and there’s the con­cern that win­ning the Brexit vote might strengthen their hands in domes­tic pol­i­tics as well.

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About Steve Keen

I am Professor of Economics and Head of Economics, History and Politics at Kingston University London, and a long time critic of conventional economic thought. As well as attacking mainstream thought in Debunking Economics, I am also developing an alternative dynamic approach to economic modelling. The key issue I am tackling here is the prospect for a debt-deflation on the back of the enormous private debts accumulated globally, and our very low rate of inflation.
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  • twowith­inthree­thati­sone

    You’re right, Leave is the dis­cern­ing vote even if it momen­tar­ily strength­ens UKIP etc. Ref­er­ence my lat­est post on the prior thread regard­ing the gen­eral intel­lec­tual envi­ron­ment before a par­a­digm change.

    And you naive? The pro­gres­sives who sup­port Remain are not only naive they are blind as well. No ide­ol­ogy or insti­tu­tion which has come to power in a world obsessed and based on power gives it up unless they either come to know an even deeper con­cept that sur­passes and yet incor­po­rates and encom­passes power, or are herded in the direc­tion of same by a grass­roots move­ment that awak­ens indi­vid­u­als and the busi­ness com­mu­nity to their true self inter­ests, and pro­mul­gates direct poli­cies that will end their coer­cive threat of unem­ploy­ment over the indi­vid­ual like a Sword of Damo­cles.

  • Bhaskara II

    Great arti­cle pro­fes­sor Keen! Very clear.

    I spoke to an Ital­ian small busi­ness man abroad. I asked him which will be bet­ter for Italy in the future; the Euro or the Lira (Lire)? After a lit­tle clar­i­fy­ing across lan­guages, he said the Lira. I think he then said, with the the Euro there is no money and with the Lira we were rich. 

    Of course, it is not only about money, but rep­re­sen­ta­tion!

    It sounds like you have real­ized some of the pub­lic has a mis­con­cep­tion and the course might change. That seems to lead to some spec­u­la­tive oppor­tu­ni­ties accord­ing to Soros’ the­ory. It seems, Soros* still is still talk­ing about the great idea of the Euro­pean Union. Even though, he men­tions his spec­u­la­tion of where the ster­ling might move.

    On the more crass edu­ca­tional side of things that I might eas­ily effect:

    What are some good spec­u­la­tive trades for the Brexit vote?

    I have “put” paper trades down yes­ter­day. I won­der, are there are other bet­ter ones? Or, safer bets. (I should go trim some hedges in a few days, or call it loss.)

    * My talk­ing about Soros is not nec­es­sar­ily mak­ing a good encom­pass­ing ref­er­ence. But, his eco­nom­ics is dynamic and some what empir­i­cal.

  • Bhaskara II

    So, there was my sam­ple of one Italian’s opin­ion.

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  • Bhaskara II

    nntaleb tweets long on pounds:

    Nas­simNi­cholasTaleb Ver­i­fied account ?@nntaleb

    BTW I am long some GBP so I can talk about mar­kets tonite to satistfy #Skininthegame @will_moriarty”

    Fel­low tweet­ers are long FTSE stock index and an other has a strad­dle on Brit. assets:

  • koonyeow


    As always, you’ve backed your argu­ment with observ­ables rather than ide­olo­gies.

  • Inter­est­ing to see all the ageism in the media and among (many ill informed) younger peo­ple. Far from the days of the wiser elders. Prob­a­bly rooted in some uncon­scious fear of death, accord­ing to Ter­ror Man­age­ment The­ory

  • twowith­inthree­thati­sone

    Grace as in abun­dance is the con­scious philo­soph­i­cal con­cept that runs through, and needs to be more con­sciously inte­grated and con­sol­i­dated within the var­i­ous eco­nomic and mon­e­tary reform move­ments. For instance:

    What is “a mod­ern debt jubilee”? (Steve Keen)

    It’s Grace as in for­give­ness of Debt.

    What is Bank­ing in the pub­lic inter­est? (Ellen Brown)

    It is the finan­cial struc­tural equiv­a­lent of the omni-pres­ence of God/Self Awareness/Consciousness/psychological state of Grace/Flow. It is the finan­cial sys­temic expres­sion of Jon Kabat-Zinn’s Book title Wher­ever You Go, There You Are when describ­ing con­scious­ness. Also, as the psy­cho­log­i­cal state of Grace/Flow is the com­plete inte­gra­tion of Space, Time and Self Aware­ness, so the key­stone busi­ness model of Banking/Finance that was truly in the individual’s inter­ests is the inte­gra­tion of a car­ing, sup­port­ive and gra­cious atti­tude toward the indi­vid­ual and indi­vid­ual com­mer­cial inter­ests as opposed to the dom­i­nat­ing and manip­u­la­tive force it has become.

    What is Sov­er­eign Con­trol of the Money Sys­tem? (Pos­i­tive Money and MMT)

    It is recog­ni­tion that hier­ar­chy is nec­es­sary with forces as pow­er­ful as money, and if they are aware enough, that such hier­ar­chy is, of neces­sity, a sov­er­eignty that is utterly eth­i­cal, undoubt­edly in eth­i­cal con­trol, unbi­ased, objec­tive and com­pletely demo­c­ra­tic in its gra­ciously gift­ing dis­tri­b­u­tions to the indi­vid­ual and com­mer­cial inter­ests and so is a true Sov­er­eign Grace as in the old expres­sion “Your Sov­er­eign Grace”.

    What is true free­dom for the indi­vid­ual and grace­ful and con­tin­u­ous free flow­ing­ness for the eco­nomic sys­tem that is also aligned with our aware­ness of the Laws of Thermo-dynam­ics? (Wisdomics/Gracenomics)

    In a money and debt based sys­tem, secure, con­tin­u­ous and sat­is­fac­to­rily ade­quate pur­chas­ing power is free­dom. A uni­ver­sal div­i­dend to every adult 18 years of age and older that itself approaches a mid­dle class level of income is the gra­cious as in gift­ing expres­sion of that free­dom for the indi­vid­ual.

    In a mod­ern tech­no­log­i­cally advanced cap­i­tal inten­sive profit mak­ing eco­nomic sys­tem that is in an inher­ently dis­e­qui­li­brated state due to the ever increas­ing costs of depre­ci­a­tion of that ever increas­ing cap­i­tal, and that is also now faced with rapid ero­sion of aggre­gate indi­vid­ual pur­chas­ing power due to inno­va­tion and arti­fi­cial intel­li­gence, a means of elim­i­nat­ing that inher­ent cost infla­tion so as to enable not just a momen­tary equi­lib­rium, but a con­tin­u­ous and free flow­ing one….is nec­es­sary.

    As a true equi­lib­rium and/or flow is thermo-dynam­i­cally impos­si­ble in the tem­po­ral world we live in with­out an out­side force and/or pol­icy to enable and main­tain it, and as a momen­tary enable­ment is not a flow and cer­tainly also isn’t the main­te­nance of one, a pol­icy of cost reduc­tion at the end of the eco­nomic process at retail sale where all costs for any item or ser­vice is ter­mi­nally summed and hence after­ward no eco­nomic agent can be harmed because pro­duc­tion has become consumption…..must be imple­mented.

    Fur­ther­more, in order for the sys­tem to be con­tin­u­ously free flow­ing despite the laws of thermo-dynam­ics, a sig­nif­i­cantly price defla­tion­ary reduc­tion in retail price must be the case….and this is accom­plished by rec­i­p­ro­cal Grace as in Gift­ing by the mer­chant to the consumer…and then by the mon­e­tary author­ity back to the mer­chant for all of his dis­counts so that he can be whole on his mar­gins of profit and over­head pay­ments.

    These poli­cies are the con­cept of Grace expressed in the organic affairs of the eco­nomic and mon­e­tary sys­tems, and the inte­grated com­ple­tion of the expres­sions of the other aspects of Grace shown in the other reform move­ments above.

    Even though halt­ingly and still largely uncon­sciously the philo­soph­i­cal con­cept of Grace, in every­one of its rel­e­vant aspects, is the new
    Coper­ni­can evo­lu­tion­ary par­a­digm that a frag­mented eco­nom­ics requires for its tran­si­tion from the mind­sets of aus­ter­ity and scarcity to free­dom, free flow­ing­ness and abun­dance.

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