I voted remain because I think it would have improved European security but if we must leave let’s not get poorer as a result. And so read on…
“All That Is Solid Melts into Air”
He was referring to how capitalism (or market economies) can reshape cities and peoples’ lives. Think of Detroit or the UK’s industrial North East.
Paul Krugman said,
“Productivity is not everything but in the long run it is almost everything”
The wonderful lifestyle that we enjoy today in the developed world compared to our forebears is a result of market economies continuously increasing productivity.
The challenge is how to improve productivity while reducing the social impact of change. In the UK this will require continuing transfers of wealth from more productive residents to less productive residents, for example, England subsidises Scotland by £6bn/year. This cannot be sustained if mass migration continues unabated.
Limiting immigration after Brexit will improve the lot of the working poor through higher wages and the non-working poor through continued subsidy.
That addresses the corporeal needs of the poor so what about the rest of us?
Tim Worstall points out that it is imports that make citizens better off, not exports. When I buy a banana I am exchanging my £1 for a banana that is worth more to me than £1. If Nissan sell a car to a German hausfrau I am no better off, shareholders in Nissan are better off.
Import taxes (tariffs) are taxes on the consumers and they are taxes that affect the middle classes most, the poor don’t buy much and the rich don’t care how much it costs.
To improve the lot of the middle classes we should abolish all import tariffs
This will drive productivity increases in domestic industry. This will increase profits and improve the lot of the property owning classes.
In this amusing article Tim Worstall explains why exporters like Nissan should actually pay all our EU dues after Brexit (TLDR – they get the benefit not the taxpayer).
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