My On Point wrap-up piece for Project Syndicate.
In CityAM Mark Sands quoted me in a piece on the impact of migrants on housing and public services on 1 June.
Fellow economist Philippe Legrain, who supports liberal migration rules, slammed Fox’s comments. “This is more than dog whistle politics, it’s just demonising migrants for the failings of the British economy and the British public sector,” Legrain said.
“The bigger issue with the British housing market, which would exist even with much less immigration is planning restrictions which prevent us building extra housing. Generally EU migrants also pay in more than they take out so any pressure that exists on other public services is due to the failings of the public sector. In short, Liam Fox is talking rubbish.”
Read the full article here.
I was an expert witness to the House of Lords’ European Union Committee report into completing Europe’s economic and monetary union. In the final report published in May 2016, I am quoted several times.
Philippe Legrain… argued, in contrast, that this reduction in Germany’s surplus with the eurozone meant “that it is exporting its capital elsewhere, draining demand from the eurozone and exporting deflation to the rest of the eurozone.”… Philippe Legrain was disappointed that the Five Presidents’ Report did nothing to “tackle the issue of a mercantilist German core and the deflationary impact of that.”93
Other witnesses also criticised the narrow focus on competitiveness in the Five Presidents’ Report. Philippe Legrain said that competitiveness was irrelevant in responding to the eurozone’s challenges, and favoured “boosting productivity growth”. Focusing on ‘competitiveness’ meant: “you end up specialising in lower-end production rather than dynamically moving up the value chain and producing better goods for higher wages.”102
Philippe Legrain and Professor Jones drew attention to the structure of deposit insurance currently in place. Professor Jones noted that “the different types of German banks have different deposit insurance. That is the biggest part of the problem. Sparkassen and Landesbanken do not want to get implicated in a European system because they have their own preferential arrangements.”165 Philippe Legrain predicted that one could imagine a ‘carve out’ for the very politically powerful Sparkassen banks, similar to their arrangements under the Banking Union.166 Should EDIS be developed, the BBA supported it being embedded into the Banking Union framework, so that “the scope of banks mirrors closely the scope of single supervisory and resolution mechanism.”167
Philippe Legrain summarised the problem facing the eurozone: “We have election after election in the eurozone in which voters reject the outgoing Government, and the first thing that happens is that voters are told that they have to stick to the old policies of the government they have just rejected because EU rules say so, and I do not think that is desirable or sustainable.”210
Philippe Legrain considered that, in the immediate term, “there is little prospect of eurozone members caucusing together, simply because they disagree on so much.227
Philippe Legrain thought that the European Parliament would resist the creation of a new and separate parliament: “Such is the power of the European Parliament that it is inconceivable that you would create a separate structure … a eurozone parliament, if such a parliament were to emerge, would basically start off as a committee made up of members of the European Parliament from eurozone countries.”238
After two years of hard work, my new think-tank, Open Political Economy Network (OPEN), has finally launched today with a ground-breaking new study by me on how refugees can contribute to the economy. The report is co-published with Hamdi Ulukaya’s Tent Foundation, whose mission is to help forcibly displaced people. A key finding, based on IMF figures, is that investing one euro in welcoming refugees can boost the economy by nearly two euros within five years.
“This is a truly excellent report which should be read by anyone wishing to be informed on the subject, and particularly by policymakers,” said Peter Sutherland, Special Representative of the United Nations Secretary-General for International Migration and Development.
Please check out OPEN’s new website, http://www.
I spoke about Brexit at an Institute of Directors (IOD) Ireland breakfast event at the Westbury Hotel in Dublin on 19 May.
On 1 April I chaired a conference of students around Europe on the refugee crisis, immigration and open borders near Subotica in Serbia, just by the barbed-wire fence that Hungary has erected to keep out refugees. The conference was used to prepare an exhibition at the Bozar museum in Brussels. It was a fantastic experience. Thanks to Guy Dermul and Ditte Van Brempt for organising it.