Welcome friends!
How about the UK voting to leave the EU? Maybe like me you don’t follow European politics very closely but I bet you heard about that one. Kind of a big deal. Of course you may have heard about it without realizing it. For a while I thought Brexit was some notable foreign personage we here in the US just don’t know much about, like Rooney or anyone named Nigel. Eventually I decided to do my duty as a citizen of the world and read up on this mysterious Brexit and I discovered the word actually refers to British exit from the EU. Yes, it seems so many EU states talk so frequently about leaving the EU they had to come up with a shorthand way to refer to the phenomenon so for example Brexit, Frexit, Grexit, etc. Of course, from my perspective across the giant ass pond known as the Atlantic Ocean I don’t really care too much one way or the other. Nor is the UK exiting such an arrangement particularly surprising to me. I’m actually a little surprised there is an EU given Europe’s history of violence, nationalism, and greed. But it did get me thinking a little bit about when federal political unions work and whether my smallish brain might say anything sensible on the subject in the context of a short and flippant blog post. It’s actually a bit of a tricky area. Here in the USA we celebrate the war ending our political union with Great Britain and the war that prevented some of our own states ending their political union with other states. Humans being social animals I suppose people choosing to come together under one political system must represent an advancement of human civilization and be good in that sense but it’s also rather apparent it doesn’t always work out so well. After boiling up a modest sized cup of coffee and thinking about it for the requisite ten minutes I decided to comment on two things Brexit brings to mind for me: distributional issues and political legitimacy. Hey, come on. It’s Brexit! I should say something, right? So let’s dive right in.
First, distributional issues matter! Oh, did I say that before? Yes, I’ve found whenever strange things happen in this world distributional issues cannot be far away. I suppose that’s because we’re just not very good at talking and hence thinking about them. Not hard to understand why. It’s a bit awkward because of the implied conflict. No one would like implicit conflict to become overt and of course one superficially attractive way to prevent that is to just not talk about the implicit conflict and hope no one notices. Of course, that’s not a real solution because the implicit conflict exists and people are bound to notice it sooner or later. And while one is resolutely not thinking and talking about it all kinds of funny things are liable to happen. Then I guess a completely different source of silence on distributional issues is that those with economic power in any given system just don’t like the little people discussing such matters. (No, I’m not talking about the Munchkins; I’m talking about you and me baby.) It makes them nervous. The inevitable result is people put off discussing these issues until funny things start happening and then they start foaming at the mouth like a pack of lunatics.
I bring up distributional issues because as far as I can tell one of the big issues some people in the UK had with the EU was the EU policy of free movement of labor between member states. I’m sure I’ve mentioned before that from a distributional perspective the problem with free movement of labor is it reduces the bargaining power of existing labor, which is actually kind of a big deal because in some or let’s just say most distributional systems around today that’s the only thing that really matters for the wages of normal working people. Under the sort of labor market arrangements that exist in the UK and USA the only bargaining chip the average Joe has is scarcity. Either one has to have some attribute or skill that causes one to be scarce like being eight feet tall and able to bounce a ball or writing a fascinating blog every couple of weeks (yeah right) or labor in general has to be scarce, which isn’t bloody likely but I guess can sometimes happen in conditions approaching full employment. Under normal conditions one’s wage is not based on what one actually does or how well or efficiently one does it or anything else of that nature. As one can see from the experience of the USA over the past several decades the owners and CEOs capture most of the surplus from those sources. No, in most situations one’s wage depends mostly on whether or not the firm can find someone or something cheaper to do the job. So of course if you bring in a bunch of unemployed or underemployed people from someplace else who are willing to work for a lot less for whatever reason then the living standards of the workers already in whatever locale we’re discussing will plummet. Every American knows the way to bust a union is to bring in scabs. Same concept.
Now some people in the sort of distributional systems we’re discussing aren’t bothered by this at all. CEOs looking for cheap labor are fine with this arrangement. They’ll actually get paid more themselves for making the company more profitable. People who own stock in the company might be pretty happy as well depending on how significant that particular stock is for their income or wealth. And people who have money or are getting money some other way are usually just looking for a cheap toaster so they’re probably quite happy as well. Or maybe that’s not entirely fair. Some of them may also like the idea of helping out the unemployed and underemployed people entering the system even if it means some people already in the system struggle. Hey, foreigners are people too. My point is no one but a worker already in the system is likely to see a problem. Well, OK, other people might see a problem if total demand goes down enough to matter to the overall economy because then we might be talking about a recession that could affect whatever source of wealth they’re drawing upon themselves but otherwise not really. They most likely think everything is fine until a bunch of pissed off poor people chuck a rock through their window one fine evening. Then it’s a big freaking mystery. How did that happen? Oh my goodness! I came home with my cheap toaster and feeling pretty good about myself for helping all those struggling immigrants and suddenly Brexit! Right upside the head! I hate to think of anyone hurting their brains trying to think through such convoluted matters so let me just put it this way. People need money. People need jobs. If a nation’s way of handling this most basic of social issues is to dump most of its citizens in a big room and let them fight it out like a pack of starving rats while a few people at the top focus on further enriching themselves and scouring the shops for cheap toasters and maybe helping poor people from other regions get a slice of pie just be prepared that one day something funny might happen. And I don’t mean ha ha funny.
Second, political legitimacy matters! If one is going to form a political union with some other people everyone involved has to not only buy into the notion they have some things in common and should coordinate with one another but that the coordinating system is fair and legitimate. Now I’ve never really looked up the details of how the EU works because, you know, I’m American and we just don’t usually follow that sort of thing very closely, but I’m guessing it’s basically OK. I sometimes rib my European friends but I’ve never said they were idiots. They know as much about democracy as anyone else. But what seems funny to me is despite the presence of this overarching federal EU government the only thing I ever seem hear about in this country is the national politics of various European nations. Why is that? I mean here in the USA we have the federal government and then we have various state governments but we hear a lot about the federal government, which kind of makes sense since that’s the bit that ties us together as a nation. Europe seems to have gotten things a bit out of balance as far as I can tell. Indeed, I found I was completely incapable of naming anyone in the EU government until I read an article on Brexit and discovered the president or whatever of the EU is some guy named Juncker. Did you know? I mean, something isn’t right. The head of the EU should be a big deal, like the president of the US. Who gets elected to the EU parliament should be a big deal, like who gets elected to the US Congress. Why does no one know who the hell they are? Is anyone taking it seriously at all? Does it not actually do anything? I read a little article on EU politics the other day that said although there are pan-European political parties the norm is that the citizens of each country just discuss things on their own and then elect some local guy to represent their interests in the EU parliament and that’s the end of it. I’m not entirely sure Europeans really see themselves as one body of people with a common heritage and set of values who really should be united in a common political framework. More like a bunch of competitors trying to get one over on everyone else. That’s not going to work. Particularly when one adds distributional issues to the mix. Here in the USA we all know people in some states get more back in government benefits than they put in while the reverse is true in other states. It’s OK because we’re part of the same freaking country. If people are tanking in one part of the country it seems perfectly fine and correct to most people the rest of the country should help them out. If some people in some states act like idiots well it’s all in the family. I’m not sure Europeans think the same way. My impression is their inclination upon seeing a fellow member state in any sort of trouble is to find some way to capitalize on the situation. That’s no way to run a country. Or even a pseudo-country.
Well, I feel that’s really all I’m comfortable saying about Brexit just now so maybe we can wrap it up. We can keep it short this week. Political unions are great in my opinion. Indeed, I look forward to the world government conservatives are always fretting about because then we’ll finally have a political system that can address global issues. But we clearly have a heck of a lot of work to do before that can happen in terms of working out some thorny issues and disagreements in the political, social, economic, and philosophical realms. Can’t force human evolution. Has to come naturally. Apparently we can’t even manage a European government right now. Oh well. Let conservatives have their little celebration. They earned it. The UK and EU had issues they just couldn’t work out. Hooray! We have the rest of history to get our act together. We’ll try again another day. One day we’ll have enough experience and insight to make it work. That will be a day the rest of us can celebrate. (And yes, I did notice the interesting way conservatism has entered the discussion. I’ll have to write a little something on that later. Hint: Some conservatives focus on one thing and some on another but don’t waste your time trying to see how it all fits together because it doesn’t. That’s why conservatives are at one another’s throats right now in the US. Kind of funny really.)
