25 June 2016   Leave a comment

The Scots rejected independence in 2014 in a referendum in which 55% of Scots voted to remain a part of the United Kingdom.  The Brexit vote will likely bring about another such referendum as the majority of voters in Scotland voted to remain in the European Union.  The voters in Northern Ireland also voted to remain in the EU and they may consider leaving the United Kingdom and joining the Republic of Ireland (which is a member of the EU and also uses the euro).  We may witness the dissolution of “Great” Britain and have only England and Wales remaining.

A new and improved Panama Canal opens tomorrow ushering in what may be new patterns of global trade.  For the last nine years, construction at the canal has been ongoing so that the new super-sized cargo vessels can pass through.  The improvements will double the amount of cargo that can pass through the canal.  After tomorrow cargo vessels from Asia will no longer need to unload on the US West Coast which requires the containers to be shipped by truck or railroad to the US East Coast.  They will be able to unload their cargo in ports in the Gulf of Mexico and the East Coast reducing shipping costs for most items.  Panama makes an incredible amount of money from the tolls it charges to use the canal.  Unfortunately, most of that money never trickles down to the majority of Panamanian citizens.

The media is inundating us with articles that suggest that the Brexit vote signals the “end” of globalization.  The Washington Post ran such an article as did The New York Times.   There is little question that the Brexit vote was supported by a lot of anti-globalization sentiment.  But it is hard to see how “globalization” can be stopped.  Companies will still move their factories to low wage areas (or will roboticize their production); rich people will still shuffle their money to offshore banking sites; and people will still figure out ways to cross borders.

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Posted June 25, 2016 by vferraro1971 in World Politics

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