Venezuela & Texas

As you might have heard, Venezuela is facing economic collapse. Leftists, many of whom previously praised it as a role model tries to blame it on the sharp drop in oil prices.

Since Venezuela’s economy depend greatly on revenues from oil exports, it is no doubt the case that the price drop has weakened its economy, compared to how it would have been if oil stayed expensive. However, the point is that current weakness isn’t because of cheap oil, it’s that it wasn’t weak before only because oil was expensive.

Venezuela after all, isn’t the only country/region/state that is highly dependent on ┬árevenues from oil exports. Yet you don’t see the hyperinflation and shortages that Venezuela suffers from in for example Saudi Arabia, Norway or Russia. And in Texas,the state whose oil industry, gained international fame in the 1980s through the TV series “Dallas”, not only aren’t wee seeing any shortages or hyperinflation, employment is up 1.6% in the latest year, not very different from the national average.



Brexit Would Be Good For Britain, Bad For The Rest

In little over two weeks, the people of Britain will vote on whether or not to stay in the EU or not. What’s to make of that? Well, in short, it would be good for Britain, but bad for the rest of us if they decided to leave.

There have been some anti-exit doomssayers “reports” claiming that Brexit would have devastating effects on the British economy. But while the initial uncertainty about the terms of future trade agreements could indeed initially have a negative effect, there is no reason to believe there will be a permanent negative effect. Britain is too important (the biggest export market) for the rest of the EU to start a trade war or anything like that.

Meanwhile, Britain would save all the money they now send to Brussells, and would be free of much of the Brussells regulations and could have even freer trade with the rest of the world.

So, Brexit would be good for the Britons (at least to the extent we overlook the indirect negative effects of what I’m going to write in the next sentence) . Unfortunately it would be bad for those of us who live in the rest of the EU. Britain is the most important voice for global free trade and against EU regulations, and so if they leave, the EU would become more statist.

So, despite the benefits of Brexit for the people of Britain, I hope the “remain”-camp wins