A LEADING economist yesterday warned against Europe importing the “craziness” of President Donald Trump’s trade war.
Two of his colleagues also spoke out on the Alex Salmond Show, one suggesting Brexit could only damage the UK, and the other telling how economists were able to nail the lies that were told about Catalonia’s economic future prior to last year’s referendum.
Continuing a three part series on Catalonia, Alex Salmond yesterday spoke on his RT show to three world-ranked economists who have intervened in the Catalan constitutional debate.
They gave their views on the dangers of a world trade war, the economics of an independent Catalonia and the economic impact of Brexit on the UK.
Professor Xavier Sala-i-Martin of Columbia University put forward an alternative view on how the rest of the world should react to President Trump’s tariffs.
He said: “There are very few things that most economists agree on and that is that a trade war is bad for everybody.
“From an economist’s point of view it is crazy to see how politicians are not only doing certain things but reacting.
“When Donald Trump puts tariffs on steel he is going to hurt the American people. You protect the company by making everybody else pay higher prices... by taking money from the American people.
“What is incomprehensible is that then Europeans do the same thing, we’re going to put a higher price on bourbon. Now who is going to pay this higher price – the European citizens.
“If the President of the United States is crazy then let him be crazy. But don’t bring this craziness back to Europe.”
Professor Jaume Ventura, described how a group of Catalan economists combined to successfully influence the nature of the constitutional debate in Catalonia and there may be a lesson in what he said for those campaigning for Scottish independence.
Professor Ventura said: “At the very beginning of the independence movement, the Catalan people were bombarded with ideas that Catalan independence would not be feasible from an economic viewpoint.
“A lot of very false, outright lies were published in newspapers. “Many of us who were looking at this issue from an academic standpoint [formed] a network of economists working in many places.
“We decided to say how can it be that these lies were published, so we went and we made some calculations, we decided to write things.
“We were successful to the extent that the economic debate stopped being a debate”
Finally on the economics of Brexit, Professor Mas-Colell, author of the most used post graduate micro economics textbook in the world, and a former Catalan Economy Minister said: “ I cannot see how the United Kingdom can possibly benefit from Brexit.
“It is too large to become a Singapore.
“It has benefitted a lot from trade and education and migration from Europe and so it seems to me a very misguided move.”
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