Posts Tagged '#Brexit'

Documenting media bias and lies in Simon Wren-Lewis’ new book

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Simon Wren-Lewis

Simon Wren-Lewis, author of The Lies We Were Told, out today, talks about his anger at austerity and how this and other key events of recent times have been impacted by media bias and lies.

“Many of the key events of the last eight years have a common thread to them. In the case of austerity, the Eurozone crisis, the 2015 UK election, the Brexit vote in the UK and Trump’s election, the media played a critical role in making them happen. This involved ignoring expertise, ignoring facts that didn’t fit the chosen narrative of one side, or simple lies. None of these events are mistakes only in hindsight, but rather errors that were predicted at the time. Documenting that is an important part of this book.

It was for that reason that I tell the story through my blog posts at the time, with additional postscripts, preambles and introductions that enable each chapter to tell a complete story. There seemed no better way of showing how all of these policy or electoral errors were understood at the time and therefore could easily have been avoided.

“I began writing my blog mainlymacro because of my anger at austerity.”

I began writing my blog mainlymacro because of my anger at austerity, and the fact that the view of the majority of macroeconomists that it was a bad idea was largely ignored by the media. When the media did talk to economists, they tended to be from the financial sector. Financial sector economists are biased in two directions: they tend to be right wing and they tend to talk up the importance of a capricious financial market and their ability to know its ‘needs’. I used the term ‘mediamacro’ to describe how most of the media seemed happy to tell the story of the deficit as if the government was a household, which any first year undergraduate textbook explains is not true.

Many used the Eurozone crisis as an excuse for austerity, but I quickly discovered that the line most journalists took was missing the key reason for that crisis. Eurozone countries cannot create their own currency, and the institution that could act as an unlimited lender of last resort to individual governments, the European Central Bank, was refusing to do so. The crisis ended when the Eurozone changed this policy and became a lender of last resort to most countries. The exception was Greece, and I tell their more complex but shocking story in a few posts.

“Adapting an old Sun headline, I argued it was mediamacro wot won it, although luck also played its part.”

Before the UK’s 2015 election the Conservatives talked about a strong economy, and talked up rising employment levels. The media went along with this narrative. In reality the recovery from the recession had been the weakest for centuries, in good part because of the policy mistake of immediate austerity. Strong employment growth combined with weak output growth meant productivity was stagnant, which in turn helped create falling real wages. Yet for mediamacro the government’s deficit was a more important goal of policy than economic growth or real wage growth, and as a result the economy was the Conservatives strong card that led them to victory at the election. Adapting an old Sun headline, I argued it was mediamacro wot won it, although luck also played its part.

Defeat in 2015 led to Jeremy Corbyn being elected as leader of the Labour party. Although this took the commentariat by surprise, I argued it was the logical result of Labour’s weak or non-existent stand against austerity and a lot of what austerity required. When John McDonnell became shadow Chancellor, he invited me to be part of an Economic Advisory Council, and I explain how this led me to help create Labour’s fiscal rule, which is the first such rule that prevents austerity. I also explain why the Council came to an end.

“A consequence of the Conservatives winning in 2015 was a referendum on Brexit.”

A consequence of the Conservatives winning in 2015 was a referendum on Brexit. A few months before I wrote a post reproduced in the book which fairly accurately set out how the campaign would play out. Remain’s case was that leaving the EU would have serious economic consequences, and it was a very strong case, but I suggested the media would balance this case against nonsense from Leavers, and the electorate could convince themselves that the economics was not clear cut. The fact that free movement prevented controlling immigration from the EU was by contrast clear cut, but as the government had played up the negative aspects of immigration they could not credibly change course.

Alas the media’s failed to present near unanimous expert opinion in economics and elsewhere as knowledge, and instead it became just Remain’s opinion to be balanced by the other side. As a result the electorate, who craved information about the EU, did not get it from the broadcast media. In addition, those that read most of the daily papers by readership got propaganda pure and simple, and had been getting it for a year at least. I present strong evidence at how influential the media can be, and therefore argue that Brexit represented the triumph of the right wing press. I showed that the media were failing in similar ways in the US, and that therefore confidence that Trump would not get elected could be misplaced,

The book also has a chapter on the role of economists in influencing policy. Did the global financial crisis or the failures of macroeconomic forecasting discredit economics, and is macroeconomics influenced by ideology? I explain why the delegation of economic decisions can be partly about transparency, and why economics is most like medicine among the sciences.

“While the media played an important role in Trump becoming President and Brexit it does not explain why those things are happening now rather than ten or twenty years ago.”

While the media played an important role in Trump becoming President and Brexit it does not explain why those things are happening now rather than ten or twenty years ago. The final chapter in the book looks at what neoliberalism is, and why both austerity and using fear of immigration to gain votes despite austerity can be seen as neoliberal overreach, by which I mean taking deception of the electorate in order to pursue ideological goals to a dangerous extreme. Both austerity and anti-immigration feeling helped the cause of Brexit and helped elect Trump.

The Global Financial Crisis required a strong and quick recovery to avoid the dangers of populism. Austerity prevented a strong recovery, and it was undertaken as a cynical attempt to reduce the size of the state. The subsequent populist mood was directed towards the right by politicians and the media playing on racism and xenophobic fears. This was fertile ground for disasters like Brexit and Trump to happen. This suggests that even if we could go back to the world as it was before Brexit and Trump that is not enough to stop similar disasters happening again.

The Lies We Were Told FCThe Lies We Were Told by Simon Wren-Lewis is available with 20% discount on the Policy Press website. Order here for £11.99.

Find out more about impact, influence and engagement at Policy Press here.

Policy Press newsletter subscribers receive a 35% discount – sign up here.

The views and opinions expressed on this blog site are solely those of the original blog post authors and other contributors. These views and opinions do not necessarily represent those of the Bristol University Press and Policy Press and/or any/all contributors to this site.

Brexit: 10 myths about the ‘Norway model’ examined

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On 8 May the UK’s House of Lords passed an amendment to require the House of Commons to vote on remaining in the European Economic Area (EEA), the possibility of Britain adopting the so-called ‘Norway model’ is back on the agenda of British politics.  

Here the authors of Squaring the Circle on Brexit: Could the Norway Model Work?, John Erik Fossum and Hans Petter Graver, give some background to Norway’s relationship with the European Union and reveal the truth behind some common myths about the Norway model.

“While Norway has rejected membership of the European Union twice in referendums in 1972 and 1994, it has consistently sought as close a relationship with the European Union as is possible for a non-member.  The core element of that relationship is the European Economic Area (EEA) agreement, which came into effect in January 1994, almost a year before the second referendum.  This seamlessly ties Norway to the EU’s internal market without it being part of the supranational political union.

However, Norway’s experience shows how non-members of the EU must make difficult trade-offs between relative autonomy in decision- and rule-making and access to the EU’s internal market and other EU policies.  Norway is frequently portrayed as a ‘rule-taker’ and there is no doubt that Norway’s inability to affect EU rule and decision making is – democratically speaking – very problematic.

A closer look at Norway’s experience reveals that, in spite of this, members of the EEA can still shape their socio-economic model and mode of functioning.  In other words, how a country handles its relationship with the European Union matters.  Norway has retained a well-functioning welfare state and high levels of trust in public institutions, helping to offset potential negative influences. This trust is crucial. Norway’s experience underlines that the issue is not simply one mode of EU affiliation but the important left-right issue of choice of socio-economic model, which has significant bearings on the question of social justice.

“Norway has retained a well-functioning welfare state and high levels of trust in public institutions, helping to offset potential negative influences.”

Given these pros and cons, and the reemergence of the EEA as an essential aspect of the Brexit agenda, now is the time to unravel some of the myths around Norway’s relationship with the EU:

 

1. The ‘Norway model’ is an arrangement that just involves Norway

A core aspect of the Norway Model is, in fact, the European Free Trade Association (EFTA)-based EEA agreement which was signed by Iceland, Lichtenstein and Norway and where all decisions are based on unanimity.

 

2. The Norway model is the EEA

The Norway Model is made up of 120 different arrangements and covers a far greater realm of issue-areas than just those regulated under the EEA agreement. Norway is an affiliated member of Schengen and asylum and police cooperation (Dublin I, II and III. Norway is therefore within the EU’s external border with responsibility for border controls. It has also signed agreements on foreign and security policy and participates in the EU’s battle groups).

 

3. The Norway model is more constraining than the Swiss model

Unlike Norway, the Swiss have opted to unilaterally adapt their legislation to be EU-compatible. The EU is unhappy with the Swiss arrangements. They will likely not be extended elsewhere.

 

4. The EU’s off-the-shelf arrangements for non-members are straitjackets that do not allow for the flexibility of a bespoke deal

The sheer range of affiliations under the Norway Model testifies to some flexibility and ingenuity, but there are limits, especially within the EEA agreement which is about common rules and equal conditions for competition. There is political will on both the EU side and the Norwegian side to maintain close relations, and that allows for a certain measure of flexibility.

 

5. The Norway Model does not allow for an independent trade policy

The EFTA states retained their freedom to decide their own trade policies towards third countries because they are not part of the EU’s customs union. Norway had negotiated 27 free trade agreements with the EFTA countries in 2016, and has undertaken negotiations with ten countries (including China) and regional trade blocks (MERCOSUR).

 

6. No deal is better than a bad deal

Theresa May has said on Brexit that no deal is better than a bad deal. The Norway Model, with all its challenges, has shown to Norwegians that having common rules and equal conditions of competition, and the equivalent means of enforcement, offers the certainty that is necessary for an open economy to function in today’s tightly interwoven Europe.

 

7. The Norway Model is deeply contested in Norway and is unlikely to receive majority support elsewhere

In fact, there always been a clear majority in Norway in support for the model it has adopted: there is little support for EU membership, and very little support for abolishing the EEA. There is a very strong sense across most economic sectors that assured EU access is vital for prosperity. 65% of Norway’s exports (excluding oil, gas and ships) go to the EU. Norway needed a Schengen association agreement (to be within EU’s borders) in order to preserve the Nordic passport union which ensures free movement in the Nordic region.

 

8. The Norway Model is about rule-taking 

There is no denying the arrangement is democratically problematic, but there is scope for local adaptation and flexibility. The Norway model reflects the complex nature of the EU, which combines a supranational core (the internal market) and a set of intergovernmental arrangements for handling matters of border controls, and security. There is more scope for bargaining in the intergovernmental realm, which the UK has experienced through its numerous opt-outs and opt-ins. In the supranational realm the EU is also constrained by the Court of Justice, which has the final say on what arrangements are compatible with the EU aquis (the body of common rights and obligations that are binding on all EU member states) The implication is that the EU is more likely to accept bespoke arrangements in the intergovernmental than in the supranational institutional realm.

 

9. The key question about the Norway Model is the type of affiliation that it represents

That is only part of the picture. Equally important is how Norway handles this affiliation domestically. What Norway’s experience shows is that it is important to consider the state’s ability to handle its EU relationship. The Norwegian state is a well-functioning state with a high level of competence and a broad range of comprehensive welfare arrangements that enable it to compensate actors for the negative effects of Europeanisation. Norway also has a tradition of consensus-based politics that contribute to keeping EEA issues outside the realm of party politics.

 

10. Norway will be included in the European Union’s post-Brexit arrangements

Norwegians will not automatically get the same arrangements with Britain that members of the European Union will. Norway is not part of the Brexit negotiations and for many issues Norway will have to sort out its relations with the UK on its own, for example, on the rights of Norwegian citizens in the UK and UK citizens in Norway. In this case, the UK government has assured Norway that citizens will receive the same treatment. Nevertheless, Norway is a decision-taker on the sidelines during the negotiations on the UK’s future relationship with the EU and is concerned with when its arrangements with the UK will be settled.

 

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Could the Norway model work for Britain? Find out more in Squaring the circle on Brexit – Could the Norway model work? by John Erik Fossum and Hans Petter Graver, a comprehensive first-hand account of Norway’s relationship with the EU.

The book is available with 20% discount on the Policy Press website. Order here for £19.99.

Find out more about impact, influence and engagement at Policy Press here.

Policy Press newsletter subscribers receive a 35% discount – sign up here.

The views and opinions expressed on this blog site are solely those of the original blog post authors and other contributors. These views and opinions do not necessarily represent those of the Policy Press and/or any/all contributors to this site.

If not a hard Brexit, then what?

janice-morphet

Janice Morphet

Now that a ‘hard’ Brexit seems less likely, Janice Morphet – author of Beyond Brexit? – looks at alternative options for the UK’s relationship with the EU.

“Following the apparent disruption of hard Brexit that has followed the General Election, it is now time to review the other options available to the UK.

It would have been better to review these before the referendum was called and to explain the options to more fully inform the electorate during the campaign. Even after the referendum result, a review of the options would have been helpful rather than the incoming Prime Minister opting for the hardest form of EU/UK relationship without appreciating the paradox that her social welfare agenda could best be achieved using EU values, programmes and policies.

However, better late than never. So what are the real options available rather than those frequently suggested by those politicians less familiar with the EU?

 

The European Free Trade Association (EFTA)

The most frequently discussed approaches are the potential for the UK to return as a member of the European Free Trade Association (EFTA). This was set up in 1960 by the UK as an alternative free trade bloc to the EU when the UK realised that it had made a mistake in dismissing membership of the then Common Market. Its members are now Iceland, Lichtenstein, Norway and Switzerland. While EFTA works as a group on some issues, its members have different relationships with the EU. This might suit the UK, but Norway has already indicated that it may not take the UK back into EFTA membership. How do these relationships work individually?

Continue reading ‘If not a hard Brexit, then what?’

What now for Brexit?

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Danny Dorling, Dimitris Ballas and Benjamin Hennig

Danny Dorling, Dimitris Ballas and Benjamin Hennig – authors of The human atlas of Europe – look at the reasons behind Labour’s success and ask… what now for Brexit?

 

“On June 8th 2017 young people all across the UK turned out to vote for a new conception of politics and a more inclusive, nourishing vision of society (as New Internationalist journalist Chris Brazier put it).

The rise of Labour in the polls in the month before the election was three times greater than any rise ever seen for that party in a month before. The swing in the vote to Labour was greater than that measured at any general election other than the 1945 landslide election. To be fair to Jeremy Corbyn it was actually even greater than that, as that 1945 swing took ten years (from 1935) to occur. In contrast, Labour’s swing in 2017 emerged within just two years of the last election (held in 2015).

Despite the enormous success in the polls and the voting booths it was not enough for Labour to win. The party had started so far behind in 2015 that a completely unprecedented swing would have been needed for outright victory. Labour’s four week surge in the polls would have had to have been not just three times greater than it had ever been before, but five, six or seven times – depending on exactly where that swing had been geographically concentrated. An outright Labour victory in June 2017 was nigh-on impossible in the circumstances, not least of a split Labour party.

But what Labour achieved was enough to put the Conservatives into the demotion zone of now being a minority government.

 

“..greater solidarity is gaining in popularity over division.”

 

Continue reading ‘What now for Brexit?’

A General Election to challenge – or intensify – neoliberalism?

Bryn Jones and Michael O’Donnell, authors of Alternatives to neoliberalism, argue that a ‘hard Brexit’ under a Tory government would strengthen, not challenge, the neoliberal agenda.

Mike O’Donnell

Bryn Jones

Public sector retrenchment, deregulated markets and corporate takeovers of public and civil society spheres are contested topics in this election. Yet the protagonists do not directly acknowledge that these arise from the disruptive effects of the generation-long, neoliberal system.

Neoliberalism still underlies the current social unrest and political crisis; but its ideological hegemony is under threat. Trump, neo-nationalist populism across Europe and Brexit, all express popular angst caused by neoliberal processes: de-industrialisation, public sector austerity, worsened living standards, insecure and/or poorly paid employment.

“Trump, neo-nationalist populism across Europe and Brexit, all express popular angst caused by neoliberal processes.”

Continue reading ‘A General Election to challenge – or intensify – neoliberalism?’


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