Sunday, 14 May 2017

In or out of Europe?

Let me say up front that I do not believe Britain is in a state where it can leave Europe without economic consequences. I say this because of the “single”/”global” market mentality. This mentality says we have to export what we produce in order to have a local economy. It argues that we need access to the European common market in order for Britain to survive.

Is there an alternative to dependency on Europe or some other external market? I believe there is and I believe it doesn't mean isolation from the rest of the world. Let me try to explain.

The health of any nations economy tends to depend on the health of the world economy. This is because we have headed toward global markets. As a result, an economic blip in one country tends to vibrate around the world causing economic shocks or blips in other nations.

What would happen if instead of focusing on a global market, we focussed instead on vibrant, sustainable local markets and communities. This isn't to eliminate trade between communities but it is about giving priority to the health of local markets over the larger world market. If local markets are healthy and providing the bulk of the essentials for a local community then there is less likelihood that a local glitch in one economy would rebound through other local economies. This doesn't stop local economies and communities helping each other when times are tough but does remove the effect of global economic impacts.

A local sustainable market would have its own currency and have control over its own currency. The objective of the local currency should be on ensuring that local resources can be interchanged in an equitable manner to meet needs. This means it can be used to facilitate the local economy without concern for wider economic activity. To understand how this might happen, you need to understand monetary systems including the way money is created and how the money supplied is maintained. There should always be enough money in a local economy for it to buy and sell the goods and services that it produces provided there is no over supply of those goods and services. The foundation of money is a promise to supply goods and services to the value of the currency. Just a word of caution, I place the emphasis on meeting needs and not on building artificial markets. The way we construct local markets will influence rates of resource consumption and wastage. Excess goods and services produced by a community is what it uses to exchange with other communities for goods and services which it is unable to produce for itself but again the focus should be on need and not maximising profit or growth. Being sustainable means that it wants to ensure a continued viability in the local market and community and not extract current goods and services for short term gain at the expense of longer term viability.

There are other advantages of local economies and these relate to community spirit and community building. The global economy tends to draw people away from their local community and consequently decrease local dependency and interaction. This also means a decrease in the awareness of need within the local community. Restoring a local economy helps get people interacting on a local basis and builds more awareness of each other's needs.

Interaction between local communities starts at regional level and then a national level finally leading to exchange between nations. At all levels, the focus needs to be on satisfying needs and ensuring sustainability. As soon as it switches to maximising profit or return on services, the community spirit is destroyed and inequality will increase.

So, I could accept BRexit if I saw more vibrant sustainable local economies operating in the UK. Since I don't and I don't see any group advocating BRexit promoting such a strategy, I don't believe BRexit is a good idea.

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