Saturday Rate of Exchange:
How Much Must Britain Pay?

from Burr Deming

 
Neil Bamforth at MadMikesAmerica takes a look at Brexit negotiations. The European Union wants twice in an exit settlement what Britain is willing to pay. There seems to be a common agreement that there exists, in leaving, a moral debt. Neil wonders why, in the absence of any clear legal obligation, Britain doesn’t threaten to simply walk away.

We linked to Neil’s analysis. Infidel753, whom we regard as expert in such matters, reacts:

There is no reason the UK should be paying anything to get out of this parasitic organization, but there are two reasons why the EU is strongly motivated to grab whatever cash it can.

First, there are rumblings of discontent in other member states. Even in France, pro-independence candidates won 43.6% of the vote in this year’s election in May. The EU has every reason to want to make Brexit as painful as possible to discourage others from getting out.

Second, Britain is a net donor to the EU budget and its departure will leave a huge shortfall which will have to be made up by other members. It’s similar to what would happen with our federal budget if a net donor state like California or New York were to leave the US. Anything the EU can grab from Britain’s pockets on the way out will be that much less they have to pry out of German and French taxpayers or save via aid cutbacks to poorer countries.

I’m often surprised at how many Americans seem to think the UK is some kind of giant Disneyland that stopped being a serious country in 1945 and survives on tourism and Monty Python residuals. It’s the fifth or sixth largest economy in the world and a major exporter of things like pharmaceuticals and heavy equipment. It’s the main supplier of financial services in Europe. It’s also one of only two real military powers in the EU (the other is France), so if Europe ever wants to develop its own defense capability more independent of the US, it’s going to need British cooperation, EU or no EU. The Brussels oligarchy is lucky it isn’t dealing with a British government that’s really inclined to play hardball and use all the leverage it has. They don’t really hold a lot of cards here.

More from Infidel753 can be found here.