The Seven Mistakes That Led to the (Shameless Stupidity of) Brexit
How Britain Chose to Self-Destruct and Make Itself a Global Laughingstock
If you’re not quite following the bizarre, incredible, self-self-inflicted catastrophe that’s Brexit…well, I wouldn’t blame you. It’s not only labyrinthine…it’s a maze of shameless stupidity, head-spinning folly, and despair-inducing backwardness so deep that they literally seem impossible.
Let me tell you the story, in seven mistakes, that will probably go down in history as among the most hilariously, weirdly, astonishingly tragic set of choices a rich country ever made, (right up there with America cheerily electing a wannabe cartoon Fuhrer, of course.)
The first, formative, fundamental mistake — the one which set the wheels of tragedy in motion — that led to Brexit happened in the halcyon days of 2007. The global financial crisis exploded, the result of decades of financial “liberalization”, which basically means banks and hedge funds were granted open season to do their worst. That meant investing in shady project, giving loans to oligarchs, and pumping and dumping stocks. As most of these foolish “investments” were revealed to be little more than a shell game, bank after bank was threatened with sudden, catastrophic illiquidty, and then insolvency (translation, running short of money, and then going broke with nothing left to sell.)
The mistake that the British made was similar to the one that America did. It took all these private loans, and effectively put them on its own balance sheet — the public ledger. But almost no banker was prosecuted for fraud or malfeasance or simple misconduct. Almost no bank was reformed, management shaken up, and so on. In other words, the old formula of capitalism was applied yet again: privatize the gains, socialize the losses. The finance sector was bailed out, at the cost of…well, we don’t really know. Nobody’s counted it up yet. The best estimates put it at trillions.
Now, economics doesn’t have much that’s useful to teach us. But there is one lesson which stands out. After financial crises, countries swing to the right — the greater, the harder. Why? The reason probably goes something like this: thanks to neoliberalism, what happens after financial…
