There are two economic dangers from leaving a political union. The first is trade dislocation. Political unions are not necessary for free trade. In fact that hinder it. The EU is basically one big bribery ring where member countries pay off politicians and bureaucrats in Brussels not to harass member countries. It’s like a labor union where the fatcats get all the fees in exchange for forcing out competitors by labor legislation.
The first economic danger is that EU bureaucrats will be ‘butthurt’ as they say and exact trade punishment on the UK by erecting tariffs and embargoes and bans and quotas and whatever else. This is not necessary, but it could happen.
The second economic danger, and this is the major one, is a dissolution of currencies. If a Euro country were to leave the EU, the Euro would fall apart, robbing everyone’s savings in the Eurozone as would happen eventually anyway but a dissolution would hasten it.
The Euro, the Dollar, they will all fall by sheer weight of printing exhaustion. The sooner the better because the sooner the less catastrophic. It’s not the dissolution of the Euro that is is the problem, but a fiat currency controlled by bureaucrats itself that is the problem. The minute it was introduced it was destined for collapse because it is not free market money, but political force money.
Now that Texas wants to secede from the Union, which would be great, the danger to Texas is again trade barriers and the death of the dollar. If dollars are no longer the currency in seceded states, the dollar falls, which again would happen anyway eventually but this would hasten it. I’m all for hastening the inevitable so we can get on with our lives.
Of course, no president would ever allow any state to secede from the Union. They would sooner annihilate every Texan than allow secession. If Texas votes to secede, Trump or Clinton or whoever is head of the army would invade and kill, just like Lincoln did.
But it would indeed be sweet if states just started seceding. How about we make the European Union voluntary, and the American Union voluntary. Those who want to pay taxes to Brussels in Europe are free to do so. Those who don’t want to don’t have to. Those who want to send a federal tax return to Washington can certainly do so. Those of us who don’t, shouldn’t have to. That would be fine.
But of course, political unions depend on forcing those unwilling to contribute.
Brexit is a beautiful thing. I would rather have trade barriers than bribe bureaucrats to lower them with ever bigger unions and bribery fees.