onsdag 25 oktober 2017

Topsy-turvy view of trade

Trade takes place because goods are worth more to the buyer than to the seller. Everyone's idea of a good deal is that one buys things that satisfy their wants and are good value for money. A brand new car at a 20% discount is a good deal, in normal usage.

But in this whole debate over Brexit, the idea of a good deal has been turned inside-out. The "good deal" is that people in the UK are allowed to sell UK produce to people in the EU. It is as if people in the EU were not really buying British goods because they wanted them, but as a favour or act of charity.

The reality is that keeping out British goods is depriving EU people of the opportunity to purchase them. It is exactly the same as if the UK imposed sanctions on the EU and refused to sell its goods. In normal situations sanctions are imposed against a country as a punishment. In this case the EU is imposing the punishment on itself, not particularly because there is any desire to punish the UK but because that is the way the Single Market trade rules operate.

Why are so few people able to see this? Is it because it is too obvious?

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