Wednesday, 27 April 2016

In 1981, 364 economists got it totally wrong and they are wrong today on Brexit

When working at the Bank of England I was not popular with the hierarchy. It is one of the advantages of age that I can remember when the accepted wisdom of the great and the good in Economics got it totallly wrong. These people have such huge egos and lack of manners that even now they still cannot admit they were wrong. Its now called groupthink but I think arrogance is a better description.

The UK was in a mess in 1981 Thatcher had been in power for less than two years inflation was rising, boorowing was rising and in the 1981 budget Chancelllor Geoffrey Howe put up taxes by £4 bn to try and cut our borrowing. The whole economics establishment including Mervyn King and economic Nobel laureates  rose up en masse and signed a letter to the Times forecasting doom, disaster and armageddon as a result of this economic illiteracy by Howe just like the Remain campaign is doing today attacking Brexit. In fact Howe was simply not accepting the Keynsian economic orthodoxy and recognised the political context which trumps economic orthodoxy. Adam Smith was not an economis professor he was Professor of Political Economy.

Thatcher faced the same line of questioning as Andrew Neil deployed today on the Daily Politics against Brexiter Liam Fox ie are all the great and the good wrong and you are right and name any reputable economists who support your view.

When challenged in the HoC in similar fashion Thatcher named Alan Walters, now dead, and Patrick Minford both of whom I knew quite well as supporting her view. She could have added Tim Congdon and Terry Burns, but 364 aginst 4 looks overwhelming but of course the economic establishment were wrong and the gang of four were correct. Following Howe's so called disastrous budget the UK economy went from strength to strength.

You can read this in more detail by clicking the link below,

Liam Fox quite rightly referred to the more recent cases of ERM entry pushed by Heseltine and Howe onto Nigel Lawson which of course turned out to be an absolute disaster in Sept 1992 leading to a massive loss of UK reserves and brought Cameron his first public appearnce skulking in the shadows in Downing Street behind Norman Lamont. In 1997  Gordon Brown avoided joing the Euro despite heavy pressure from the Eurofanatics like Mandelson. Brown was no great economic brain or principled politician. He did it for political not economic reasons to establish a seperate power base to Blair.

The depressing thing is these people who were so wrong before, Mandelson, Heseltine and Clarke are still being so heavily promoted by the BBC as men of great wisdom whom we should listen to. Look at the facts. They have a long track record of getting it wrong along with their puppet master, the BBC.

Neil then switched to all those reputable international organisations predicting disaster if we dare leave the EU. He named the IMF and OECD. Both have a poor record of forecasting accuracy on a par with HMT. Patrick Minford had much better forecasting accuracy than all three!

Brexit supporters include PatrickMinford, Tim Congdon, Gerald Lyon all economists of repute strongly supporting  Brexit. All are UK nationals living in the UK who have a strong love of the UK.

The IMF is based in Washington. It is headed by the French woman Mme Lagarde who was put forward for election and relection by Gideon Osborne. She is a lawyer not an economist. The IMF has been a French rotten borough and since its founding in 1948 has been under French control about 60% of the time.

Previous to the IMF Lagarde was Sarkozy's French Finance minister and was and still is a Euro fanatic who played a large part in the ongoing Greek Euro disaster.

 In 1981 Lagarde joined Baker & McKenzie, a large Chicago-based international law firm. She handled major antitrustand labour cases, was made partner after six years and was named head of the firm in Western Europe. She joined the executive committee in 1995 and was elected the company's first ever female Chairman in October 1999.

Now who else was growing up professionally in Chicago at that time? Barack Obama was there from 1991 so must have overlapped with MMe Lagarde, He joined Davis, Miner, Barnhill & Galland, a 13-attorney law firm specializing in civil rights litigation and neighborhood economic development, where he was an associate for three years from 1993 to 1996, then of counsel from 1996 to 2004.

The OECD is based in Paris and has been French dominated with a large French staff contingent since 1948 changing its name to the OECD in 1961.

So all these independent sources A Neil likes to quote are not quite as independent as A Neil and the BBC claim. They all swim in the same pond and are staffed by people of similar background. Beware the independence claim! 

I see Fraser Nelson has  piece in the Spectator today on the OECD
 It seems to say Brexit would cut UK immigration by 84000. Now there's a thing that Dave claimed he would do but failed at like everything else.

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