Horoscopes
Columnists
Like Us On Facebook

OP/ED: Brexit seems like a lonely way to go, Britain

BY JEFFREY OPPENHEIM, M.D.

 

As world markets, pundits and the media try to make sense of the decision by the United Kingdom to withdraw from the European Union, one thing is clear: America needs to avoid the Machiavellian instinct to fear imaginary barbarians at her gates. Globalization, free trade, and an active immigration program have made America prosper and efforts to reverse this trend are doomed to hurt our economy.
Brexit was a vote against globalization. The British are afraid that integration with Europe was hurting their economy by siphoning economic resources to the weaker countries (Portugal, Italy, Greece and Spain – the PIGS). Brexit was also a vote against open immigration. Not only were the British afraid that foreigners were taking their jobs, but they were also seen as a threat to their culture. The mistake made by the UK is evident in the damage already done to their currency and global reputation.
In America a similar fear is being propagated by our Presidential candidates. Trump wants to dismember NATO, end free trade, block immigrant Muslims from our shores and build a wall with Mexico, while kicking out more than 10 million illegal immigrants. Bernie Sanders rallies against the free trade acts, such as the North American Free Trade Act (NAFTA) and wants better protection for American workers. Even Hilary Clinton, who long ago supported free trade, voted against the Central America Free Trade Act (CAFTA) and now opposes the Trans-Pacific Partnership (TPP). Each of these opinions flies in the face of economic facts and experience.
Economists agree that free trade benefits virtually everyone. If this weren’t the case, then we might as well argue that people should only be allowed to consume things that they made themselves. Who would argue for that? The same analogy holds for nations. The ability to sell American products abroad without constraints drives the American economy, while being able to purchase foreign made products at the lowest prices lifts our standard of living. Conversely, trade barriers result in fewer jobs and a lower standard of living.
While no one wants to lose their job, competition and progress necessitate change. If protectionism were to rule our economy, we would still be riding in horse carriages. Free trade facilitates competition and innovation. Erecting barriers to trade cannot result in economic prosperity. Data from the Heritage Foundation and the World Bank clearly show a linear relationship between GDP growth rates and economic freedom. Has isolationism benefited North Korea? Can anyone seriously believe that American isolationism would lead to more jobs at home?
Similarly, welcoming immigrants to our economy has been the single greatest source of economic growth in American history. Waves of immigration over the last 2 centuries has fueled the greatest economy in human history. Even recent history is ripe with examples of immigrants and immigrant children transforming our economy (e.g. Steven Jobs, Sergei Brin). Indeed, 40% of the Fortune 500 companies were founded by immigrants or the children of immigrants. The revenue generated by these companies is greater than the GDP of every country (except the US, Japan and China). Without another generation of immigrants, our American economy would decline.
In his newly published book, The Rise and Fall of Nations, Ruchir Sharma directly ties the success of nations to the growth rates of their populations. A declining growth rate of the working class is the clearest sign that a country is heading for economic decline. The British have naively ignored this lesson. If America closes immigration to Hispanics, Chinese or Muslims we can expect to pay a very significant economic cost. Assuring national security is no excuse to deny the next generation economic prosperity.
In times of economic fear people, and nations, are prone to take populist actions that are detrimental to their own future success. Brexit is just the latest example of such an act of idiocy.brexit

 

-Jeffrey Oppenheim, M.D. is a neurosurgeon and the former Mayor of Montebello, New York

 

Comments