Grant: Britain will have a Brexit productivity boom
Michael Grant, Co-CIO of Calamos Investments told Yahoo! Finance that he considers Brexit an economic Get Out of Jail Free Card for the UK.
Michael Grant, co-CIO and Senior Co-Portfolio Manager of global investment firm, Calamos Investments appeared on Yahoo! Finance on Thursday and explained why he was bullish about Britain post-Brexit saying:
“Ultimately, the European Union is sort of a protector of a stagnant status-quo. Most economists, if you ask them what drives economic growth; they’ll tell you, productivity. Productivity is a mix of laws and taxation, education, the legal system, openness to innovation and so forth. And one of the reasons why the European Union is the worst performing major economic region of the world is because it has low productivity; driven, very much, by the policies of the European Union. So breaking away from that regulation and that tax policy is, sort of, like receiving a Get Out of Jail Free Card, in economic terms.”
He did allow that there would be some teething issues adjusting to Brexit, but was of the firm belief that these were heavily outweighed by the benefits Brexit would bring to Britain. He told Yahoo! Finance:
“After for decades of integration, there will be some disintegration costs that will be incurred by Britain and the European Union. But the point is, there is a lot of upside for managing the economy in a pro-growth, pro-productivity way that doesn’t exist when you’re a member of the European Union.”
He also agreed with Boris Johnson that the backstop would severely curtail these benefits saying:
“The Irish backstop was the poison chalice; to ensure that Britain stays close to the European Union and, obviously, it doesn’t want to do that. So a big part of the fight that is going on is getting rid of the backstop, which will then free them in trade terms and regulatory terms and so forth.”
Mr. Grant also dispelled the mainstream media fallacy that in all matters trade the EU has the upper hand over the UK. According to him, economists know that this is not true. He reminded Yahoo! Finance:
“With respect to trade, obviously, the UK runs a significant trade deficit with Europe. One of the things that economists don’t tell you is that in an trade war, or a trade conflict, the countries that are the most vunerable are those with the surplus, not the deficit. The surplus is on the continent.”
Patrick Sullivan is the Political Editor of The Commentator @PatJSullivan
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