Brexit and Airlines

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About a week before the UK government triggers Article 50, and the stories are just rolling out about taking control how difficult untangling the UK from the EU is going to be, how much business is going to head across the Narrow Sea (and to a much lesser extent, across the Irish Sea), and how very little influence the UK government is going to have on the process.

EU chiefs have warned airlines including easyJet, Ryanair and British Airways that they will need to relocate their headquarters and sell off shares to European nationals if they want to continue flying routes within continental Europe after Brexit.

The Guardian adds a little British understatement, “The ability of companies such as easyJet to operate on routes across the EU has been a major part of their business models.” Indeed.

Some airlines have started to seek headquarters within the EU and to restructure their ownerships. EU holding requirements could include “the forced disinvesting of British shareholders.” At least some business leaders were hoping the problem would go away. Because reasons, I suppose. “EU officials in the meetings were clear, however, about the rigidity of the rules, amid concerns at a senior EU level that too many in the aviation industry are in denial about the consequences of the UK’s decision to leave the bloc.”

Getting a new agreement won’t be easy, either. At present, the European Court of Justice is the final arbiter of disputes that arise under the agreements that cover air travel within Europe. The current UK government has signaled that it wants to leave the ECJ’s jurisdiction entirely. And of course undoing a multilateral agreement opens the door for some states to assert their individual interests in negotiating a new one: Spanish diplomats have said that they will not sign on to any international accord that recognizes the airport in Gibraltar. Somebody might be taking back control.

This is shaping up to be a very good couple of years for corporate relocation businesses, and possibly for people looking to sign on at the new headquarters locations replacing folks who were unwilling or unable to leave the UK when their jobs picked up and went.

Brexit and Banks

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With Prime Minister May due to trigger Article 50 eight days from now, shit’s about to get real the clock is about to start ticking, not least for the huge financial center in London. Nothing in the present UK government suggests that they will be able to negotiate an amicable separation in the twenty-four months before they are unceremoniously bounced from the European Union. (Less actually, as agreements will have to be finished early enough for the relevant bodies to vote on their approval.) Hard Brexit, here we come.

Likewise, I don’t see any reason for the 27 to let London continue to have the same access to EU financial markets that it had when the UK was a member of the Union. Prudent bankers came to similar conclusions long ago, and indeed Bloomberg finds that plans to move people and capabilities into the remaining EU are taking concrete shape. Frankfurt and Dublin are the likeliest winners: Frankfurt is the largest financial hub on the continent, and home to the European Central Bank; Dublin is the only English-speaking alternative. (At least until Scotland joins the Union.) This was always the way to bet, and reporters’ talks at individual banks are adding micro details to the macro framework.

“Bank of America Corp., Standard Chartered Plc and Barclays Plc are considering Ireland’s capital for their EU base to ensure continued access to the single market, said people familiar with the plans, asking not to be named because the plans aren’t public. Goldman Sachs Group Inc. and Citigroup Inc. are among banks eyeing Frankfurt, other people said.”

Two Japanese institutions Bloomberg spoke with are considering Amsterdam; Morgan Stanley, local patriots, insisted that New York would gain as they and other institutions re-allocated resources away from Europe entirely. Brexit is going to put a huge dent into one of the UK’s most important economic sectors. Taking back control!

The Populist Papers: 29 Years of Populism

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Thinking about Brexit, the Donald, Austria having a presidential election replay, and other things, it struck me that in a sense I’ve lived through a Populist Era, a parallel history to the official narrative of ever-closer European union and what we might call ever-closer Western union. The starting point is hard to place. Jörg Haider’s party joined the Austrian government at the end of 2000. Silvio Berlusconi was first elected as Italian prime minister in 1994. In the same year, the BNP won and lost its first local council seat. But we’d be fools to ignore what was happening further east – Vladimir Meciar’s third term as Slovak prime minister from 1994-1998 is an example, and some people argue Slobodan Milosevic from 1989 onwards was the very first. Then you have to deal with the FN’s electoral breakthrough, at the French parliamentary election of 1987. Jean-Marie Le Pen achieved a score that time his party wouldn’t equal until 2015.

Since then, they’ve come thick and fast and all over the world, in societies as various as Thailand and Australia, or Bradford and Dresden. They are as diverse as the societies that gave rise to them, and the degree of success they have achieved varies enormously. It is commonly said that the word “populist” just means a political party others don’t want to accept, but I disagree with this. It is true that they differ dramatically in their content. Leaving the European Union is obviously not a priority for the newly elected bishop-mayor of Rio de Janeiro, Marcelo Crivella. Yet Crivella is recognisably a populist and would fit nicely on a platform with Marine Le Pen, Nigel Farage, Beppe Grillo, or Donald Trump.

Instead, I think, what unites them is a way of doing rather than a way of seeing. You can look at this as an aesthetic style, or as a technology for winning elections. It doesn’t matter; style, after all, is founded on technique. But looking at it as a set of style tropes and technical solutions has the advantage that we can understand it as such. Technology diffuses. Once it is invented, sooner or later, it spreads, and it spreads the faster the more people feel able to try it out and to adapt it to their own aims, aims which are themselves changed by the process of trial. We know quite a lot about the sociology of innovation diffusion.

So I want to pick out the minimal common elements of the technology here. So far I’ve got:

Politics against method

Most types of state have some form of universal ideology, a body of ideas that are meant to guide the citizenry in all they do. Conservatism in Burke’s sense claims this is embodied in old institutions, which must be defended. It therefore aligns the power of the state with the authority of those institutions. Liberalism demands that the institutions get out of the way of the citizenry in the name of liberty, and therefore sets up the power of the state as a sort of depoliticised referee whose mission is to guarantee that liberty. In this sense, socialism or at least social democracy is the sturdy child of liberalism – rather than merely asserting the equality of citizens and sitting back to let them get on with it, the state aims to actively ensure their equality in the name of positive liberty. Even beyond this, most states also believe in some form of technocracy, in economic or administrative principles and techniques that represent the state of the art and can be rolled out around the territory for the greater good.

One of the most interesting features of populism is that it rejects method. This goes well beyond the now quaint idea that what matters is what works. Method is both a source of power, and a constraint on power. If it doesn’t work, you can’t do it. On the other side, it is entirely acceptable to argue that you are pursuing “politics for the little man” and immediately offer a massive tax cut to the richest, justifying this on libertarian grounds, and then demand that the state subsidises petrol prices. I remember Jörg Haider doing all these things in the same speech. Method is a construct of the boring, and a tiresome constraint on rhetorical creativity. Instrumental rationality is subordinated to expressiveness. This is one of the reasons why populism is often described as “post-modern”.

Method is also a force against one of populism’s most important aims, which I am about to discuss.

Repoliticising the state

Liberalism, very broadly defined, likes to see the state as a neutral force, hanging “above the parties” as the Germans say. Conservatism and socialism both see it as a force for universal good, differently defined. They all, however, believe that it is different from partisan politics. This does not mean that it is apolitical, just that it is different. Parties and interest groups come and go, but the state endures, and at least claims to serve the public good. One way to look at this is as a depoliticisation of the state. Rather than being defined by opposition to an enemy, it is defined by the inclusion of its citizens.

Carl Schmitt argued that the fundamental political act was to define friends and enemies. He is an example of a long-running counter-tradition in Western political thought that fears this depoliticisation and wishes for a partisan state. Populists demand that the government takes sides among its citizens, that it acts in an explicitly partisan manner. They want to feel that the state is on their side, not because it serves the public good, but because they personally get took care of. Following any particular method obstructs the state in doing this, as it requires that the state acts in accordance with rules.

An important concept here is victimhood. I covered this in a previous post on my own blog. In an important way, populism democratises access to the category of people who feel justified in demanding state help. This is a consequence of the rejection of method; if there is no determinate standard of victimhood, then everyone can feel justified in wallowing enjoyably in it.

Many other writers on populism, from Richard Hofstader onwards, have observed that it arrogates to itself the right to define the people. This is primarily important, though, because it permits them to use the state in the manner that great political thinker, the Salford Machiavelli, Dominic Noonan advised: Look after those that look after you, fuck off those that fuck off you. It shouldn’t need saying that the EU is a prize example of an institution built on method that tends to depoliticise the state, as is NATO, NAFTA, and the WTO. Interestingly, the German ultraconservatives of the 1920s thought the same about the League of Nations.

I’ll make you a deal

It follows that the response to a problem or an injustice is not necessarily to solve it, but rather to make an exception. Schmitt, again, held that this was precisely the attribute that defined sovereignty, and perhaps that is why populists are so attached to the idea of sovereignty. Populism is a system of exceptions. If you do not believe it is possible to get anything right systematically, and you do not believe in the institutions, you can still hope you might be able to get special treatment for yourself. As such, it is something of an indicator-species for a low trust society. Soviet citizens were constantly trying to get treated “po chelovek”, on a personal basis.

Donald Trump, of course, tries to cope with literally everything this way. The F-35 project is far too complicated and is costing too much? If you yell at Lockheed-Martin hard enough, they might give you a discount for the sake of quiet, and of course you can also take care of them by ordering more airframes down the line when everyone will have forgotten. You can’t compete with German exporters? Jump the counter and yell until they offer you a deal. But it’s not just him. Haider offered cheap Libyan diesel around come election time; Theresa May has taken to distributing cash whenever a charismatic exporter threatens to leave the UK. This can also be done in a negative sense, by calling someone in and publicly humiliating them.

It is worth noting that a problem, in this view, is an opportunity to make yourself indispensable. There’s a reason why low-trust societies don’t function well.

Bullshit, and the rejection of constraint

If you reject method, and reduce politics to a system of individual customer-retention gimmes and theatrical humiliations, it follows that you don’t have much use for facts. In some sense, a fact arises because of a method. I think this may explain why the rejection of constraint is so important to populists. Nigel Farage affects to believe that cigarettes are good for you. Donald Trump grabs ‘em by the pussy. I asked a Brazilian friend of mine who voted for Crivella, and she thought for a moment and said “People with big white trucks who live in Zona Oeste”. This remark needs a bit of unpacking; the socio-cultural references packed in there are meant to evoke a petty bourgeois or nouveau riche aesthetic, but I’d like to focus on the truck.

If there’s a constraint they like to reject above all others it’s anything to do with energy, the climate, and hence transport. In part this is explained by the fact there are major funders available who hand out cash to people who reject this constraint. Beyond cynicism, though, is it too impressionistic to imagine that some people feel experts in general just want to take their trucks and make them listen to the doctor and stop smoking? I think this is interesting, because the populist target market tends to be the same around the world – rather well-off but not particularly educated fifty-somethings, not coincidentally also a demographic that likes to jump the counter and demand a deal, and that consumes a lot of ambient media.

That said, I also don’t believe Farage really thinks Craven “A” don’t affect your throat. Instead I think this is a performative statement. Harry Frankfurt famously defined bullshit as speech that doesn’t bear any relationship with truth, not even the negative one lies do. The great thing about bullshit, in Frankfurt’s telling, is that it offers so much creative freedom to the bullshitter to come up with what his audience would enjoy hearing. Populist bullshit arises because it’s fun and it gets the desired audience on your side. Farage’s audience would like to feel, for a while, that cigarettes are good for you and that they might get a special offer.

Made it through another month

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Now that Trump has outlasted William Henry Harrison as president of the United States, perhaps it’s time to publish here something I wrote elsewhere just a few days after the American election.

Germany’s next.

If there is any major leader who has Putin’s number, it is Merkel. A Clinton-Merkel tandem at the world’s top table would have made things exceptionally difficult for him. Half of that tandem is out of the picture, and Putin would clearly like to see off the other half as well. National elections here are next year (probably in mid- to late September).

We’re about to see a stress-test of Germany’s democratic institutions, and of the values that the postwar era has strengthened.

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Well then.

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Looking back at posts from January 2009, I see a mix of hope and serious concern. Country after country was following the US into what has since become known as the Great Recession. It is reckoned by some as the largest global contraction since the 1930s; I’ve only been following such things for about 20 years, so I don’t know for sure (the Asian currency crisis of 1997 might give it a run for its money in terms of the number of people harmed), and Edward, who would likely have known off the top of his head, is no longer with us.

Still, for all that massive economic dislocation was bearing down on the developed world, new leadership in America gave cause for hope. Republican ideas had been tried, and had failed in the sands of Iraq and in the money markets on Wall Street that had turned into casinos where gains were privatized and sufficiently large losses offloaded onto the general public. With the Bush restoration in 2000, that party had claimed that the grown-ups were back in charge. But it was Democrats who did all of the adult things of putting America back together after the economic carnage of 2008, and they even managed to extend America’s promise to people who had been excluded, to take some of the fear out of American health economics, and to give regular folks more of a chance against plutocracy. In foreign policy, Obama’s most famous adage — “Don’t do stupid shit” — illustrates the low bar set by his predecessor, one unlikely to be cleared by his successor.

Here at the outset, the Trump administration (I still can’t believe I have to write that) looks set to do some very stupid shit indeed. Statements from the transition have not been particularly coherent, but they indicate that the incoming administration does not care whether NATO and the European Union continue to exist, and may in fact prefer it if they didn’t. This is foreign policy malpractice on the greatest scale imaginable. NATO and the EU are human institutions, and therefore imperfect, but blithely talking about doing without them indicates that the Trump people have not asked the third great policy question: “Compared to what?”

We’ve seen what Europe is like without institutions, in which Putin-style land grabs and subversion of neighboring governments are the order of the day. Every few months construction crews in Berlin dig up another unexploded bomb that’s a relic of the last time that kind of Europe was in vogue. Let’s just not.

Given that European policy and politics with Trump in the White House are likely to be a Gish gallop of ridiculous idiocy, it will be worth it to me to concentrate on a few things, in the hope that other people will pick up other threads. At the moment, I’m most interested in Kremlin subversion of the upcoming German election, further signs that Putin’s circle is testing Europe’s institutions, conflicts in the Caucasus, and some aspects of Brexit. In my working life, I have been doing a lot of things related to pharma and biotech in recent years, and so at a micro level I am interested in whether the European Medicines Agency stays in London (seems unlikely, post-Brexit) and if not, who will win the competition to host the agency. I’m sure other stuff will attract my attention, but that’s what I know I will be looking at.

Thanks, Obama. I hope we see your like again before too much time has passed.

4200

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Thirteen years, and now 4200 posts.

Judging from the level of activity, Brexit broke the blog. Now with the election of Trump, we’ll get to see a lot of other stuff broken. When I first started writing here, I was still doing a fair amount of public speaking in cooperation with the US consulate in Munich. I often fielded questions about a multipolar world, and they often implied that such a world would be better than the unipolar moment following the end of the Cold War. We’re about to find out about that now, too, because the incoming administration is going to take the US out of a lot of global debates. The new political leadership may also render the government lame by personal corruption, chaos in the top echelons, deliberately gumming up the works, or some new way to fuck things up that I wasn’t previously aware of. (Needless to say, I won’t be doing any public speaking in cooperation with the embassy in Berlin for the next four years.)

Next year promises to be interesting. The Putin government is already working out ways to meddle in the German and French elections. I think Trump’s election put paid the idea that a president Le Pen is impossible; let’s hope that France nevertheless finds a way to avoid such an outcome. From current polling, it looks like the AfD will get into the German parliament. That means six parties in the Bundestag, assuming the FDP manages to come back from their drubbing last time around. Building a coalition will be difficult, and the larger the AfD delegation, the more difficult it will be. The SPD may finally have to work with the heirs of the Communists who so effectively persecuted their forbears in East Germany.

Thirteen years. 4200 entries. Onward.

The Eurozone bailouts: learning more

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The Independent Evaluation Office (IEO) for the IMF released its evaluation of the Eurozone bailouts last week. Unfortunately, the excellent report was released on the Thursday of what was for Bureaucristan the last working week before September, and was released as a package with prebuttal of the recommendations by the Fund itself, which diluted its impact. And even in the financial pages of the newspapers, attention was more focused on the banking stress tests which came the following day [UPDATE: good attention to the IEO report from the New York Times]. Nevertheless, the report deserves a long shelf life; below the fold (direct quotes in italics), a selection from its more striking findings: note, these findings may have been documented elsewhere sporadically before, but one value of the report is collecting them all in one place and integrating them into a broader narrative.

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Headline chasing

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IMF note to the G20 meeting in Shanghai in February –

The global recovery has weakened further amid increasing financial turbulence and falling asset prices. Activity softened towards the end of 2015 and the valuation of risky assets has dropped sharply, especially in advanced economies, increasing the likelihood of a further weakening of the outlook. Growth in advanced economies is modest already under the baseline, as low demand in some countries and a broad-based weakening of potential growth continue to hold back the recovery. Adding to these headwinds are concerns about the global impact of China’s transition to more balanced growth, along with signs of distress in other large emerging markets, including from falling commodity prices. Heightened risk aversion has triggered global equity market declines and brought a further tightening of external financial  conditions for emerging economies. Strong policy responses both at national and multilateral levels are needed to contain risks and propel the global economy to a more prosperous path.

IMF note to the G20 meeting in Chengdu in July–

“Brexit” marks the materialization of an important downside risk to global growth. The global outlook, set for a small upward revision prior to the U.K.’s referendum, has been revised downward modestly for 2016 and 2017, reflecting the expected macroeconomic consequences of a sizable increase in economic, political, and institutional uncertainty. But with “Brexit” still very much unfolding, more negative outcomes are a distinct possibility.

The two notes, which are written barely 6 months apart, read together bizarrely. The earlier note sees anxiety in financial markets and searches around for any narrative that could justify that — to the point where even a fall in oil prices could be bad! The new note has the luxury of an actual negative shock — Brexit — to work with, but with one big problem relative to the doom-and-gloom narrative of February:– it says that if it wasn’t for Brexit, the IMF was ready to along with the evaporated panic from February, and anyway financial markets haven’t taken Brexit particularly badly!

Could it be that the financial market-led narrative in February was a panic in search of a problem, except that the markets — and thus anyone using that as their lens — missed the one problem that was actually on the horizon, namely Brexit? As it happens, financial asset prices could well be a bit player in the way Brexit eventually plays out.

Ukip’s sinister double bill and failed political leadership

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Until early this year it seemed unlikely that an extreme idea lingering for two decades on the political fringe could turn into a mainstream choice preferred by majority of British voters as happened on June 23. Ukip’s leader Nigel Farage declared victory: he has for decades championed leaving the European Union but that was only half of his political double bill.

“The phrase, ‘I’m not racist, but…’ could be invented for some of the things Farage has done in politics,” Tory MP Damian Green said on BBC’s Daily Politics on the day Farage announced his resignation as Ukip’s leader. Stressing he was not accusing Farage of being a racist, Green added: ”He encourages feelings that are unhelpful and destructive, and that’s what he’s always done for his political career.”

Farage denies it, leading “Leave” politicians also deny it but in addition to the Ukip fanfare policy of leaving the European Union, Farage and Ukip have unashamedly brought something else to British politics, propagated by the whole “Leave” campaign: xenophobia and outright racism.

The political legacy of the victorious Farage is not only Brexit but the destructive sentiment of xenophobia, particularly appealing to older voters. However, Brexit would never have happened without support from established politicians, most notably Tory politicians like Boris Johnson, Michael Gove, Andrea Leadsom and Labour politicians like Gisella Stewart. With their support, the once so extreme view of leaving the EU, laced with xenophobia, is now mainstream.

The treacherous road from January 22 2013 to June 23 2016

In a speech on 22 January 2013 Prime Minister David Cameron promised to renegotiate UK’s membership of the European Union: no later than 2017 should the British people be given a “simple choice” of a continued EU membership on renewed terms – or leaving the EU.

As so many of his generation in the Tory party Cameron had never shown any particular interest in European matters but the EU has always come handy when a scapegoat was needed: all evil came from Brussels, the brilliance from Tory policies and their leaders.

Given the momentous pledge in 2013, Cameron’s attitude towards the EU was strangely enough no more enthusiastic than earlier. So, after eleven years as a Tory leader and six years as prime minister two months of campaigning didn’t make up for his earlier disinterest in all things European.

At the time of Cameron’s pledge, Farage’s Ukip was enjoying a record following of 10% in the polls, also worrying for Labour. Cameron was not prepared to call a referendum to rid the Tory party of dissident anti-EU ideas and Ukip’s influence.

What Cameron and those around him didn’t seem to understand or didn’t believe was that Ukip’s speak was permeating the mind of so many Tory MPs underpinning not only Brexit but also the other part of the Ukip double bill: the xenophobia and racism. These two currents united in the “Leave” campaign where the political pondus of the likes of Johnson and Gove gave wings to Ukip’s mission.

The “simple choice” of 1975 v the muddled choice in 2016

The seeds for the Brexit disaster were already sown by Cameron when it came to posing the 2016 referendum question: the choice was no longer simple, as it had indeed been in 1975, but a muddled one.

In 1973 the British Tory government led by Edward Heath, decided to join the European Community, a decision tested in a referendum under Labour’s Harold Wilson in 1975; 67% of those voting said yes. Although the motives and arguments were manifold the question – to join or not – was clear and unequivocal.

The recent referendum had a clear “yes” option in the “Remain” but the “no” option, “Leave,” was ambiguous. Wrapped up in the “Leave” was Ukip’s original goal of Britain leaving the EU, never a mainstream opinion in Britain until the referendum – and the stated goal of many Tories inter alia Boris Johnson who argued for his position by claiming Britain would secure a better deal by voting “Leave.”

Bumpy start… towards ashen Tory faces

Farage’s “out” and the “get a better deal” propagated by non-Ukipers gave the “Leave” campaign a bumpy start. Interviews with the Tory “Leavers” waving the “better deal” gave rise to the obvious question what would qualify for a “better deal” leading to unexciting answers.

With the “Take control” slogan things took a better turn for the “Leavers.” Although that also invited convoluted discourse – control of what and what would this new era of British control imply – this slogan could be connected to all relevant issues, be it immigrants or the NHS.

Now, the various sentiments awoken earlier by the fringe Ukip could easily be merged into mainstream Tory speak, useful not only to unruly Tory backbenchers but to leading Tories like Johnson and Gove.

As the voting stations closed June 23 Farage still seemed to believe his long-time apparently so ludicrous goal of pulling Britain out of the EU was lost; seven hours later he was a triumphant if stunned winner.

Contrast Farage’s celebratory appearance with the funeral demeanour of Johnson and Gove when they finally made a public appearance late Friday morning. Their ashen faces indicated they realised they would now need a plan, which they didn’t have. Demagogy and burning ambitions are two sentiments notoriously difficult to harness – a few days later their political fortunes had turned but that is another story.

Farage, leading a fringe party, didn’t feel obliged to have a plan. He had wanted a Brexit, getting it was all he needed to claim victory and he could resign (though given his career of resignations it’s a different matter if he really is leaving politics).

The Ukip xenophobia: from extreme to mainstream

Damian Green’s epitaph of Farage building his political career by encouraging destructive ideas sums up one view of Farage’s political contribution.  Farage may fade out of UK politics but his message lingers on among those who took note of his message as they had never before. Not because his message was better or different than it has been for decades but because established and leading politicians adopted and legitimised his stance.

By adopting Farage’s stance on the EU, Brexit supporters like Gove and Johnson, not to forget Andrea Leadsom, also propagated the other part of the Ukip’s political bill, the xenophobia with a whiff of racism. Here, the “Remain” stance of the Labour leadership, especially Jeremy Corbyn, was lamentably weak.

Leading Brexiters from the two big parties vehemently deny xenophobic intentions and undertones but that is too late: thanks to the Brexiters outside of Ukip these views have entered the political discourse. Again, what once was extreme is now mainstream.

The once so loony and laughable

To be exact, this legitimation hasn’t only happened in the last few months. For years, instead of rebutting the often hugely misleading statements from Ukip on immigration with facts and figures established mainstream politicians came to echo the Ukip view. Also, by not engaging the fact that concerns on immigration were the embodiment of simmering anger over political failures since the 1980s was lost.

Already in 2006 Cameron called Ukip “a bunch of … fruticakes and loonies and closet racists mostly.” Like Cameron, established politicians saw Ukip as a crazy fringe party: there was no need to argue with Ukip, no need to correct Ukip-ers’ misleading statements. In the media, largely sympathetic to Ukip’s views, the party was often ridiculed but almost in an endearing underdog way with Farage clowning on BBC’s Have I Got News For You.

With time, there was the seducing option for established politicians to use these sentiments for their own political advantage inter alia by blowing problems with immigration out of all proportions and blaming the immigration on EU rules.

The referendum “Leave” campaign showed that Ukip had by now shaped the immigration debate: further, its views were legitimised by Tory “Leavers” campaigning for a cause earlier only touted by Ukip with arguments earlier only used by Ukip. – This is the grin the parting Farage leaves in British politics.

Danish echoes

The Danish political environment is fundamentally different from the British one but similarly to what has been happening in Britain, xenophobic sentiments, tinged with racism permeated Danish politics in the years up to the elections in 2001. Ukip’s sister party Danish National Party emanating these ideas, jumped from a fringe position with 7% of votes to being the third largest party with 12% of votes and a decisive influence.

In the previous years DNP, founded in 1995 but an offspring of 1970s right-wing currents, had put pressure on the established parties, both the centre-right parties and the Social Democrats, leading many politicians to concede to and echo the DNP view instead of debating it. Buoyed by its 2001 results DNP came to shape Danish immigration policy and the political language: what could earlier not be said had been legitimised. With 21% of votes in the 2015 DNP is now the second largest party in Denmark after the Social Democrats.

Interestingly, in Denmark immigration hasn’t been blamed on EU but been a domestic bone of contention. In spite of sceptic EU-attitude there is no appetite in Denmark to leave the EU and hasn’t been for years. DNP, which used to be anti-EU has without fanfare abandoned its anti-EU stance.

There is however a Danish Brexit effect: opinion polls show increased support for Danish EU membership and less appetite for a Danish referendum on membership. Before the British referendum 40% of Danish voters wanted a referendum on Danish EU membership, 60% preferred to stay in the EU and 22% wanted to leave; now these numbers are respectively 32%, 70% and 18%.

Abdicating political responsibility

When David Cameron, under pressure from Ukip, promised a referendum he might have been lured by an easy game against “loony fruitcakes.” Following an albeit narrow win in the 2014 Scottish referendum and in the 2015 general elections he lost the EU referendum and together with that loss, xenophobia and worse has come to stay in British political debate.

The economist Joseph Schumpeter (1883-1950) claimed the welfare system would be in danger when the sense of entitlement to gain from it was greater than the will to contribute to it. Similarly, democracy is in danger when politicians take it too much for granted and can’t be bothered to argue with ideas that undermine it. After all, being in power means not only having power to take action but also to sway and influence opinion.

Cross-posted on Icelog.

How many people care about immigration?

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I wrote this for Politico Europe, but they won’t have it, perhaps because it’s not OMG BREXIT enough. To update it, let’s note that Ipsos MORI reckons only 20% care about immigration and more people think they, personally, have benefited from it than not.

With ten days to go, the two Brexit campaigns are talking about almost nothing but immigration. Gone, the expansive talk about whether the “Norway model”, the “Canadian model”, or indeed the “Albanian model” so dear to Michael Gove’s soul would be preferable. Nobody is now pushing the virtues of unilateral free trade. Instead, it’s all about immigrants, immigrants, immigrants, or sometimes Turkey, a placeholder for immigrants.

This worries a lot of people. Immigration polls badly. Surely this is the Leavers’ strongest suit? The problem, though, is that something can be your strongest suit and still be pretty damn weak. Consider a chart I used back in April, 2015, for this Politico piece. Back then, using YouGov’s online poll, immigration was rated the No.1 issue nationally, with 50% of the public saying it was their biggest concern for the country.

If you asked them what they, themselves, worried about, well. Immigration plummeted from 50% to 20%, far behind the economy, the NHS, pensions, and tax. Even UKIP voters displayed the same effect, although the level was different. 90% thought immigration was the top issue for the country, until they had to put some skin in the game, when it came down to 49%.

YouGov’s most recent referendum poll, from the 6th-7th of June, hammers the point home. This was a forced-choice question, where the respondents had to pick one issue and one only. Only 20% of the public say immigration will decide how they vote. 31% say the economy. Another 31% say it’s:


Which is likely to strike a better balance between Britain’s right to act independently, and the appropriate level of co-operation with other countries

And 4% say it’s foreign policy in the classic sense. Now, Remain is camped all over the economy, which it’s hitting from all angles, and Leave has pretty much stopped even trying. We can try different assumptions about the vaguely defined “appropriate co-operation” question. If the Remain side is getting as little as a third of those, though, it suggests they are addressing about 45% of the electorate, with an upper bound around 60%. The problem with All Immigrants, All The Time is that only about 20% of the public care all that much.

Of course, perhaps there are so many more people worked up about immigration out there. They’ve managed not to show it at any general election in their lifetimes. But now der Tag is upon us, and they will rise like lions after slumber. Could happen, as we said in Yorkshire. Meaning: don’t hold your breath.

Daniel Kahneman, of Judgment under Uncertainty and Thinking, Fast and Slow fame, got his Nobel prize in part for his contribution to prospect theory, the study of how human intuitions about risk diverge from rationality. In principle, a 40% chance of gaining €100 should be worth exactly as much as a 100% chance of gaining €40. In practice, it’s much more complicated than that; the curve bends, so people generally prefer the sure thing even when the expected value is identical.

More interestingly, your decision depends on your starting point. If you’re in the money, rather than being more recklessly confident, you’ll pass up more chances. If you’re out of the money, though, you’ll tend to double down and pick opportunities with worse chances and bigger payoffs in order to chase your losses. Like: betting the farm on those 20%. That said, that YouGov poll does say 40% of the public think #Brexit would be good for the NHS. I stick by my call, but chance is chance.