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Obama’s empire

The 44th president of the United States was elected amid hopes that he would roll back his country’s

In December 2008, shortly before being sworn in as the 44th president of the United States, Barack Obama pledged his belief that, "to ensure prosperity here at home and peace abroad", it was vital to maintain "the strongest military on the planet". Unveiling his national security team, including George Bush's defence secretary, Robert Gates, he said: "We also agree the strength of our military has to be combined with the wisdom and force of diplomacy, and that we are going to be committed to rebuilding and restrengthening alliances around the world to advance American interests and American security."

Unfortunately, many of the Obama administration's diplomatic efforts are being directed towards maintaining and garnering new access for the US military across the globe. US military officials, through their Korean proxies, have completed the eviction of resistant rice farmers from their land around Camp Humphreys, South Korea, for its expansion (including a new 18-hole golf course); they are busily making back-room deals with officials in the Northern Mariana Islands to gain the use of the Pacific islands there for bombing and training purposes; and they are scrambling to express support for a regime in Kyrgyzstan that has been implicated in the murder of its political opponents but whose Manas Airbase, used to stage US military actions in Afghanistan since 2001, Obama and the Pentagon consider crucial for the expanded war there.

The global reach of the US military today is unprecedented and unparalleled. Officially, more than 190,000 troops and 115,000 civilian employees are massed in approximately 900 military facilities in 46 countries and territories (the unofficial figure is far greater). The US military owns or rents 795,000 acres of land, with 26,000 buildings and structures, valued at $146bn (£89bn). The bases bristle with an inventory of weapons whose worth is measured in the trillions and whose killing power could wipe out all life on earth several times over.

The official figures exclude the huge build-up of troops and structures in Iraq and Afghanistan over the past decade, as well as secret or unacknowledged facilities in Israel, Kuwait, the Philippines and many other places. In just three years of the Iraq and Afghanistan wars, $2bn was spent on military construction. A single facility in Iraq, Balad Airbase, houses 30,000 troops and 10,000 contractors, and extends across 16 square miles, with an additional 12 square mile "security perimeter". From the battle zones of Afghanistan and Iraq to quiet corners of Curaçao, Korea and Britain, the US military domain consists of sprawling army bases, small listening posts, missile and artillery testing ranges and berthed aircraft carriers (moved to "trouble spots" around the world, each carrier is considered by the US navy as "four and a half acres of sovereign US territory"). While the bases are, literally speaking, barracks and weapons depots, staging areas for war-making and ship repairs, complete with golf courses and basketball courts, they are also political claims, spoils of war, arms sale showrooms and toxic industrial sites. In addition to the cultural imperialism and episodes of rape, murder, looting and land seizure that have always accompanied foreign armies, local communities are now subjected to the ear-splitting noise of jets on exercise, to the risk of helicopters and warplanes crashing into residential areas, and to exposure to the toxic materials that the military uses in its daily operations.

The global expansion of US bases - and with it the rise of the US as a world superpower - is a legacy of the Second World War. In 1938, the US had 14 military bases outside its continental borders. Seven years later, it had 30,000 installations in roughly 100 countries. While this number was projected to shrink to 2,000 by 1948 (following pressure from other nations to return bases in their own territory or colonies, and pressure at home to demobilise the 12 million-man military), the US continued to pursue access rights to land and air space around the world. It established security alliances with multiple states within Europe (Nato), the Middle East and south Asia (Cento) and south-east Asia (Seato), as well as bilateral agreements with Japan, Taiwan, South Korea, Australia and New Zealand. Status of Forces Agreements (Sofas) were crafted in each country to specify what the military could do, and usually gave US soldiers broad immunity from prosecution for crimes committed and environmental damage caused. These agreements and subsequent base operations have mostly been shrouded in secrecy, helped by the National Security Act of 1947. New US bases were built in remarkable numbers in West Germany, Italy, Britain and Japan, with the defeated Axis powers hosting the most significant numbers (at one point, Japan was peppered with 3,800 US installations).

As battles become bases, so bases become battles; the sites in east Asia acquired during the Spanish-American war in 1898 and during the Second World War - such as Guam, Thailand and the Philippines - became the primary bases from which the US waged war on Vietnam. The number of raids over north and south Vietnam required tons of bombs unloaded at the naval station in Guam. The morale of ground troops based in Vietnam, as fragile as it was to become through the latter part of the 1960s, depended on R&R (rest and recreation) at bases outside the country, which allowed them to leave the war zone and yet be shipped back quickly and inexpensively for further fighting. The war also depended on the heroin the CIA was able to ship in to the troops on the battlefield in Vietnam from its secret bases in Laos. By 1967, the number of US bases had returned to 1947 levels.

Technological changes in warfare have had important effects on the configuration of US bases. Long-range missiles and the development of ships that can make much longer runs without resupply have altered the need for a line of bases to move forces forward into combat zones, as
has the aerial refuelling of military jets. An arms airlift from the US to the British in the Middle East in 1941-42, for example, required a long hopscotch of bases, from Florida to Cuba, Puerto Rico, Barbados, Trinidad, British Guiana, north-east Brazil, Fernando de Noronha, Takoradi (now in Ghana), Lagos, Kano (now in Nigeria) and Khartoum, before finally making delivery in Egypt. In the early 1970s, US aircraft could make the same delivery with one stop in the Azores, and today can do so non-stop.

On the other hand, the pouring of money into military R&D (the Pentagon has spent more than $85bn in 2009), and the corporate profits to be made in the development and deployment of the resulting technologies, have been significant factors in the ever larger numbers of technical facilities on foreign soil. These include such things as missile early-warning radar, signals intelligence, satellite control and space-tracking telescopes. The will to gain military control of space, as well as gather intelligence, has led to the establishment of numerous new military bases in violation of arms-control agreements such as the 1967 Outer Space Treaty. In Colombia and Peru, and in secret and mobile locations elsewhere in Latin America, radar stations are primarily used for anti-trafficking operations.

Since 2000, with the election of George W Bush and the ascendancy to power of a group of men who believed in a more aggressive and unilateral use of military power (some of whom stood to profit handsomely from the increased military budget that would require), US imperial ambition has grown. Following the declaration of a war on terror and of the right to pre-emptive war, the number of countries into which the US inserted and based troops radically expanded. The Pentagon put into action a plan for a network of "deployment" or "forward operating" bases to increase the reach of current and future forces. The Pentagon-aligned, neoconservative think tank the Project for the New American Century stressed that "while the unresolved conflict with Iraq provides the immediate justification, the need for a substantial American force presence in the Gulf transcends the issue of the regime of ­Saddam Hussein".

The new bases are designed to operate not defensively against particular threats but as offensive, expeditionary platforms from which military capabilities can be projected quickly, anywhere. The Global Defence Posture Review of 2004 announced these changes, focusing not just on reorienting the footprint of US bases away from cold war locations, but on remaking legal arrangements that support expanded ­military activities with other allied countries and prepositioning equipment in those countries. As a recent army strategic document notes, "Military personnel can be transported to, and fall in on, prepositioned equipment significantly more quickly than the equivalent unit could be transported to the theatre, and prepositioning equipment overseas is generally less politically difficult than stationing US military personnel."

Terms such as facility, outpost or station are used for smaller bases to suggest a less permanent presence. The US department of defence currently distinguishes between three types of military facility. "Main operating bases" are those with permanent personnel, strong infrastructure, and often family housing, such as Kadena Airbase in Japan and Ramstein Airbase in Germany. "Forward operating sites" are "expandable warm facilit[ies] maintained with a limited US military support presence and possibly prepositioned equipment", such as Incirlik Airbase in Turkey and Soto Cano Airbase in Honduras. Finally, "co-operative security locations" are sites with few or no permanent US personnel, maintained by contractors or the host nation for occasional use by the US military, and often referred to as "lily pads". These are cropping up around the world, especially throughout Africa, a recent example being in Dakar, Senegal.

Moreover, these bases are the anchor - and merely the most visible aspect - of the US military's presence overseas. Every year, US forces train 100,000 soldiers in 180 countries, the presumption being that beefed-up local militaries will help to pursue US interests in local conflicts and save the US money, casualties and bad publicity when human rights abuses occur (the blowback effect of such activities has been made clear by the strength of the Taliban since 9/11). The US military presence also involves jungle, urban, desert, maritime and polar training exercises across wide swathes of landscape, which have become the pretext for substantial and permanent positioning of troops. In recent years, the US has run around 20 exercises annually on Philippine soil, which have resulted in a near-continuous presence of US soldiers in a country whose people ejected US bases in 1992 and whose constitution forbids foreign troops to be based on its territory. Finally, US personnel work every day to shape local legal codes to facilitate US access: they have lobbied, for example, to change the Philippine and Japanese constitutions to allow, respectively, foreign troop basing and a more-than-defensive military.

Asked why the US has a vast network of military bases around the world, Pentagon officials give both utilitarian and humanitarian arguments. Utilitarian arguments include the claim that bases provide security for the US by deterring attack from hostile countries and preventing or remedying unrest or military challenges; that bases serve the national economic interests of the US, ensuring access to markets and commodities needed to maintain US standards of living; and that bases are symbolic markers of US power and credibility - and so the more the better. Humanitarian arguments present bases as altruistic gifts to other nations, helping to liberate or democratise them, or offering aid relief. None of these humanitarian arguments deals with the problem that many of the bases were taken during wartime and "given" to the US by another of the war's victors.

Critics of US foreign policy have dissected and dismantled the arguments made for maintaining a global system of military basing. They have shown that the bases have often failed in their own terms: despite the Pentagon's claims that they provide security to the regions they occupy, most of the world's people feel anything but reassured by their presence. Instead of providing more safety for the US or its allies, they have ­often provoked attacks, and have made the communities around bases key targets of other nations' missiles. On the island of Belau in the Pacific, the site of sharp resistance to US attempts to instal a submarine base and jungle training centre, people describe their experience of military basing in the Second World War: "When soldiers come, war comes." On Guam, a joke among locals is that few people except for nuclear strategists in the Kremlin know where their island is.

As for the argument that bases serve the national economic interest of the US, the weapons, personnel and fossil fuels involved cost billions of dollars, most coming from US taxpayers. While bases have clearly been concentrated in countries with key strategic resources, particularly along the routes of oil and gas pipelines in central Asia, the Middle East and, increasingly, Africa, from which one-quarter of US oil imports are expected by 2015, the profits have gone first of all to the corporations that build and service them, such as Halliburton. The myth that bases are an altruistic form of "foreign aid" for locals is exploded by the substantial costs involved for host economies and polities. The immediate negative effects include levels of pollution, noise, crime and lost productive land that cannot be offset by soldiers' local spending or employment of local people. Other putative gains tend to benefit only local elites and further militarise the host nations: elaborate bilateral negotiations swap weapons, cash and trade privileges for overflight and land-use rights. Less explicitly, rice imports, immigration rights to the US or overlooking human rights abuses have been the currency of exchange.

The environmental, political, and economic impact of these bases is enormous. The social problems that accompany bases, including soldiers' violence against women and car crashes, have to be handled by local communities without compensation from the US. Some communities pay the highest price: their farmland taken for bases, their children neurologically damaged by military jet fuel in their water supplies, their neighbours imprisoned, tortured and disappeared by the autocratic regimes that survive on US military and political support given as a form of tacit rent for the bases. The US military has repeatedly interfered in the domestic affairs of nations in which it has or desires military access, operating to influence votes and undermine or change local laws that stand in the way.

Social movements have proliferated around the world in response to the empire of US bases, ever since its inception. The attempt to take the Philippines from Spain in 1898 led to a drawn-out guerrilla war for independence that required 126,000 US occupation troops to stifle. Between 1947 and 1990, the US military was asked to leave France, Yugoslavia, Iran, Ethiopia, Libya, Sudan, Saudi Arabia, Tunisia, Algeria, Vietnam, Indonesia, Peru, Mexico and Venezuela. Popular and political objection to the bases in Spain, the Philippines, Greece and Turkey in the 1980s gave those governments the grounds to negotiate ­significantly more compensation from the US. Portugal threatened to evict the US from important bases in the Azores unless it ceased its support for independence for its African colonies.

Since 1990, the US has been sent packing, most significantly, from the Philippines, Panama, Saudi Arabia, Vieques and Uzbekistan. Of its own accord, for varying reasons, it decided to leave countries from Ghana to Fiji. Persuading the US to clean up after itself - including, in Panama, more than 100,000 rounds of unexploded ordnance - is a further struggle. As in the case of the US navy's removal from Vieques in 2003, arguments about the environmental and health damage of the military's activities remain the centrepiece of resistance to bases.

Many are also concerned by other countries' overseas bases - primarily European, Russian and Chinese - and by the activities of their own militaries, but the far greater number of US bases and their weaponry has understandably been the focus. The sense that US bases represent a major injustice to the host community and nation is very strong in countries where US bases have the longest standing and are most ubiquitous. In Okinawa, polls show that 70 to 80 per cent of the island's people want the bases, or at least the marines, to leave. In 1995, the abduction and rape of a 12-year-old Okinawan girl by two US marines and one US sailor led to demands for the removal of all US bases in Japan. One family in Okinawa has built a large peace museum right up against the edge of the Futenma Airbase, with a stairway to the roof that allows busloads of schoolchildren and other visitors to view the sprawling base after looking at art depicting the horrors of war.

In Korea, the great majority of the population feels that a reduction in US presence would increase national security; in recent years, several violent deaths at the hands of US soldiers triggered vast candlelight vigils and protests across the country. And the original inhabitants of Diego Garcia, evicted from their homes between 1967 and 1973 by the British on behalf of the US for a naval base, have organised a concerted campaign for the right to return, bringing legal suit against the British government, a story told in David Vine's recent book Island of Shame. There is also resistance to the US expansion plans into new areas. In 2007, a number of African nations baulked at US attempts to secure access to sites for military bases. In eastern Europe, despite well-funded campaigns to convince Poles and Czechs of the value of US bases and much sentiment in favour of accepting them in pursuit of closer ties with Nato and the EU, and promised economic benefits, vigorous pro­tests have included hunger strikes and led the Czech government, in March, to reverse its plan to allow a US military radar base to be built in the country.

The US has responded to action against bases with a renewed emphasis on "force protection", in some cases enforcing curfews on soldiers, and cutting back on events that bring local people on to base property. The department of defence has also engaged in the time-honoured practice of renaming: clusters of soldiers, buildings and equipment have become "defence staging posts" or "forward operating locations" rather than military bases. Regulating documents become "visiting forces agreements", not "status of forces agreements", or remain entirely secret. While major reorganisation of bases is under way for a host of reasons, including a desire to create a more mobile force with greater access to the Middle East, eastern Europe and central Asia, the motives also include an attempt to prevent political momentum of the sort that ended US use of the Vieques and Philippine bases.

The attempt to gain permanent basing in Iraq foundered in 2008 on the objections of forces in both Iraq and the US. Obama, in his Cairo speech in June, may have insisted that "we pursue no bases" in either Iraq or Afghanistan, but there has been no sign of any significant dismantling of bases there, or of scaling back the US military presence in the rest of the world. The US secretary of state, Hillary Clinton, recently visited Japan to ensure that it follows through on promises to provide the US with a new airfield on Okinawa and billions of dollars to build new housing and other facilities for 8,000 marines relocating to Guam. She ignored the invitation of island activists to come and see the damage left by previous decades of US base activities. The myriad land-grabs and hundreds of billions of dollars spent to quarter troops around the world persist far beyond Iraq and Afghanistan, and too far from the headlines.

Catherine Lutz is a professor at the Watson Institute for International Studies at Brown University and editor of "The Bases of Empire: the Global Struggle against US Military Posts" (Pluto Press, £17.99)

MILES COLE
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The new Brexit economics

George Osborne’s austerity plan – now abandoned by the Tories – was the most costly macroeconomic policy mistake since the 1930s.

George Osborne is no longer chancellor, sacked by the post-Brexit Prime Minister, Theresa May. Philip Hammond, the new Chancellor, has yet to announce detailed plans but he has indicated that the real economy rather than the deficit is his priority. The senior Conservatives Sajid Javid and Stephen Crabb have advocated substantial increases in public-sector infrastructure investment, noting how cheap it is for the government to borrow. The argument that Osborne and the Conservatives had been making since 2010 – that the priority for macroeconomic policy had to be to reduce the government’s budget deficit – seems to have been brushed aside.

Is there a good economic reason why Brexit in particular should require abandoning austerity economics? I would argue that the Tory obsession with the budget deficit has had very little to do with economics for the past four or five years. Instead, it has been a political ruse with two intentions: to help win elections and to reduce the size of the state. That Britain’s macroeconomic policy was dictated by politics rather than economics was a precursor for the Brexit vote. However, austerity had already begun to reach its political sell-by date, and Brexit marks its end.

To understand why austerity today is opposed by nearly all economists, and to grasp the partial nature of any Conservative rethink, it is important to know why it began and how it evolved. By 2010 the biggest recession since the Second World War had led to rapid increases in government budget deficits around the world. It is inevitable that deficits (the difference between government spending and tax receipts) increase in a recession, because taxes fall as incomes fall, but government spending rises further because benefit payments increase with rising unemployment. We experienced record deficits in 2010 simply because the recession was unusually severe.

In 2009 governments had raised spending and cut taxes in an effort to moderate the recession. This was done because the macroeconomic stabilisation tool of choice, nominal short-term interest rates, had become impotent once these rates hit their lower bound near zero. Keynes described the same situation in the 1930s as a liquidity trap, but most economists today use a more straightforward description: the problem of the zero lower bound (ZLB). Cutting rates below this lower bound might not stimulate demand because people could avoid them by holding cash. The textbook response to the problem is to use fiscal policy to stimulate the economy, which involves raising spending and cutting taxes. Most studies suggest that the recession would have been even worse without this expansionary fiscal policy in 2009.

Fiscal stimulus changed to fiscal contraction, more popularly known as austerity, in most of the major economies in 2010, but the reasons for this change varied from country to country. George Osborne used three different arguments to justify substantial spending cuts and tax increases before and after the coalition government was formed. The first was that unconventional monetary policy (quantitative easing, or QE) could replace the role of lower interest rates in stimulating the economy. As QE was completely untested, this was wishful thinking: the Bank of England was bound to act cautiously, because it had no idea what impact QE would have. The second was that a fiscal policy contraction would in fact expand the economy because it would inspire consumer and business confidence. This idea, disputed by most economists at the time, has now lost all credibility.

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The third reason for trying to cut the deficit was that the financial markets would not buy government debt without it. At first, this rationale seemed to be confirmed by events as the eurozone crisis developed, and so it became the main justification for the policy. However, by 2012 it was becoming clear to many economists that the debt crisis in Ireland, Portugal and Spain was peculiar to the eurozone, and in particular to the failure of the European Central Bank (ECB) to act as a lender of last resort, buying government debt when the market failed to.

In September 2012 the ECB changed its policy and the eurozone crisis beyond Greece came to an end. This was the main reason why renewed problems in Greece last year did not lead to any contagion in the markets. Yet it is not something that the ECB will admit, because it places responsibility for the crisis at its door.

By 2012 two other things had also become clear to economists. First, governments outside the eurozone were having no problems selling their debt, as interest rates on this reached record lows. There was an obvious reason why this should be so: with central banks buying large quantities of government debt as a result of QE, there was absolutely no chance that governments would default. Nor have I ever seen any evidence that there was any likelihood of a UK debt funding crisis in 2010, beyond the irrelevant warnings of those “close to the markets”. Second, the austerity policy had done considerable harm. In macroeconomic terms the recovery from recession had been derailed. With the help of analysis from the Office for Budget Responsibility, I calculated that the GDP lost as a result of austerity implied an average cost for each UK household of at least £4,000.

Following these events, the number of academic economists who supported austerity became very small (they had always been a minority). How much of the UK deficit was cyclical or structural was irrelevant: at the ZLB, fiscal policy should stimulate, and the deficit should be dealt with once the recession was over.

Yet you would not know this from the public debate. Osborne continued to insist that deficit reduction be a priority, and his belief seemed to have become hard-wired into nearly all media discussion. So perverse was this for standard macroeconomics that I christened it “mediamacro”: the reduction of macroeconomics to the logic of household finance. Even parts of the Labour Party seemed to be succumbing to a mediamacro view, until the fiscal credibility rule introduced in March by the shadow chancellor, John McDonnell. (This included an explicit knockout from the deficit target if interest rates hit the ZLB, allowing fiscal policy to focus on recovering from recession.)

It is obvious why a focus on the deficit was politically attractive for Osborne. After 2010 the coalition government adopted the mantra that the deficit had been caused by the previous Labour government’s profligacy, even though it was almost entirely a consequence of the recession. The Tories were “clearing up the mess Labour left”, and so austerity could be blamed on their predecessors. Labour foolishly decided not to challenge this myth, and so it became what could be termed a “politicised truth”. It allowed the media to say that Osborne was more competent at running the economy than his predecessors. Much of the public, hearing only mediamacro, agreed.

An obsession with cutting the deficit was attractive to the Tories, as it helped them to appear competent. It also enabled them to achieve their ideological goal of shrinking the state. I have described this elsewhere as “deficit deceit”: using manufactured fear about the deficit to achieve otherwise unpopular reductions in public spending.

The UK recovery from the 2008/2009 recession was the weakest on record. Although employment showed strong growth from 2013, this may have owed much to an unprecedented decline in real wages and stagnant productivity growth. By the main metrics by which economists judge the success of an economy, the period of the coalition government looked very poor. Many economists tried to point this out during the 2015 election but they were largely ignored. When a survey of macroeconomists showed that most thought austerity had been harmful, the broadcast media found letters from business leaders supporting the Conservative position more newsworthy.

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In my view, mediamacro and its focus on the deficit played an important role in winning the Conservatives the 2015 general election. I believe Osborne thought so, too, and so he ­decided to try to repeat his success. Although the level of government debt was close to being stabilised, he decided to embark on a further period of fiscal consolidation so that he could achieve a budget surplus.

Osborne’s austerity plans after 2015 were different from what happened in 2010 for a number of reasons. First, while 2010 austerity also occurred in the US and the eurozone, 2015 austerity was largely a UK affair. Second, by 2015 the Bank of England had decided that interest rates could go lower than their current level if need be. We are therefore no longer at the ZLB and, in theory, the impact of fiscal consolidation on demand could be offset by reducing interest rates, as long as no adverse shocks hit the economy. The argument against fiscal consolidation was rather that it increased the vulnerability of the economy if a negative shock occurred. As we have seen, Brexit is just this kind of shock.

In this respect, abandoning Osborne’s surplus target makes sense. However, there were many other strong arguments against going for surplus. The strongest of these was the case for additional public-sector investment at a time when interest rates were extremely low. Osborne loved appearing in the media wearing a hard hat and talked the talk on investment, but in reality his fiscal plans involved a steadily decreasing share of public investment in GDP. Labour’s fiscal rules, like those of the coalition government, have targeted the deficit excluding public investment, precisely so that investment could increase when the circumstances were right. In 2015 the circumstances were as right as they can be. The Organisation for Economic Co-operation and Development, the International Monetary Fund and pretty well every economist agreed.

Brexit only reinforces this argument. Yet Brexit will also almost certainly worsen the deficit. This is why the recent acceptance by the Tories that public-sector investment should rise is significant. They may have ­decided that they have got all they could hope to achieve from deficit deceit, and that now is the time to focus on the real needs of the economy, given the short- and medium-term drag on growth caused by Brexit.

It is also worth noting that although the Conservatives have, in effect, disowned Osborne’s 2015 austerity, they still insist their 2010 policy was correct. This partial change of heart is little comfort to those of us who have been arguing against austerity for the past six years. In 2015 the Conservatives persuaded voters that electing Ed Miliband as prime minister and Ed Balls as chancellor was taking a big risk with the economy. What it would have meant, in fact, is that we would already be getting the public investment the Conservatives are now calling for, and we would have avoided both the uncertainty before the EU referendum and Brexit itself.

Many economists before the 2015 election said the same thing, but they made no impact on mediamacro. The number of economists who supported Osborne’s new fiscal charter was vanishingly small but it seemed to matter not one bit. This suggests that if a leading political party wants to ignore mainstream economics and academic economists in favour of simplistic ideas, it can get away with doing so.

As I wrote in March, the failure of debate made me very concerned about the outcome of the EU referendum. Economists were as united as they ever are that Brexit would involve significant economic costs, and the scale of these costs is probably greater than the average loss due to austerity, simply because they are repeated year after year. Yet our warnings were easily deflected with the slogan “Project Fear”, borrowed from the SNP’s nickname for the No campaign in the 2014 Scottish referendum.

It remains unclear whether economists’ warnings were ignored because they were never heard fully or because they were not trusted, but in either case economics as a profession needs to think seriously about what it can do to make itself more relevant. We do not want economics in the UK to change from being called the dismal science to becoming the “I told you so” science.

Some things will not change following the Brexit vote. Mediamacro will go on obsessing about the deficit, and the Conservatives will go on wanting to cut many parts of government expenditure so that they can cut taxes. But the signs are that deficit deceit, creating an imperative that budget deficits must be cut as a pretext for reducing the size of the state, has come to an end in the UK. It will go down in history as probably the most costly macroeconomic policy mistake since the 1930s, causing a great deal of misery to many people’s lives.

Simon Wren-Lewis is a professor of economic policy at the Blavatnik School of Government, University of Oxford. He blogs at: mainlymacro.blogspot.com

 Simon Wren-Lewis is is Professor of Economic Policy in the Blavatnik School of Government at Oxford University, and a fellow of Merton College. He blogs at mainlymacro.

This article first appeared in the 21 July 2016 issue of the New Statesman, The English Revolt