Tuomas Malinen+ Your Authors @mtmalinen PhD econ. Chief Economist of GnS Economics. Adj. Professor of Economics @ Uni Helsinki. Economic growth, economic crises, monetary unions and central banks. Sep. 06, 2019 2 min read + Your Authors

I've been very outspoken about #Brexit, which has raised some questions of why. Here, my five cents.

First, I am a big believer of democratic decision making. The straighter the better.

In my opinion, Brexit ref was a pinnacle in the long history of democracy in Britain. 1/

Second, the EU has continuously grown less democratic (despite of the claims to the contrary).

While first refs on EU were conducted in good practice, problems started when referendums turned against further integration. These include the double-refs in Denmark and Ireland. 2/

But, it got worse.

When European debt crisis, which actually was a (masked) banking crisis of Germany and France, threatened to break the euro, the response of European leaders was to bypass European laws.

Most notably, bailouts breached Articles 125, banning mutual... 3/

... fiscal responsibility and Article 123 of the TFEU banning all credit lines from the #ECB. The ECJ made a serious mistake by accepting the QE -programs.

I consider debt crisis as the starting point of "populist" movements.

The rules of the TFEU was made such so that... 4/

... countries wouldn't need to bear the troubles of other member countries. Politicians knew that a bailouts within the EU would never "fly" among majority of citizens of rich countries.

So, when faced by legal barriers, they decided to "deceive, inveigle and obfuscate". 5/

When bailouts faced a political backlash, a wide media campaign against "populist parties" emerged. Democracy started to die in Europe.

It was recuscitated by the referendum call of PM Cameron.

But, after a surprise victory for Leave-campaign, everything started to sour. 6/

It has been painful to watch how scared and incompetent British politicians, with exception to B. Johnson, have been.

Their negotiation stance against the EU was an utter failure, and parliament has made a complete mockery of itself. 7/

If #Brexit fails, I fear that three developments will materialize.

1) Britain will fall in serious political disarray, which will spread to Europe.
2) Democratic principles will die in Europe.
3) Article 50 will be effectively removed, locking us all in. 8/

These would doom our continent to endless political quarrels, infighting and econ depression. Europeans should not need to be reminded, what lies at the end of that road.

I might be wrong, of course, but I would not like to test that. Hopefully, Brits won't either. 9/

You can follow @mtmalinen.


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