Suggestions for those who will leave if X wins the Presidency

It all goes back to that dark November night in 2004, when eventually a winner was called. I stayed up late to watch all the way through. It was a long day. At 6:15am as I approached the polling station, an advocate for one of the candidates rushed toward me - staying just outside the mandated boundary. I put my palm toward them, and said "Forget it, I'm here to overthrow the government".

So late that November night, well actually about 3am the following morning, I stumbled to bed. My wife woke enough to ask "What is the result"?

I responded "We're moving to France".

"Okay" she said, and went back to sleep.

Well, it is that time again, the US election cycle is heating up, and like good brewing beer, the scum is rising to the top. Unlike good beer brewing, the scum is not being scraped off and discarded, hosed away into the metaphorical gutters of history. The problem is that whoever wins, almost half of the US (and much of the rest of the world) will think that the scum won.

So as we lead up to the election, we are hearing again and again, "If (fill in the blank) wins, I'm leaving the country". Okay, good for you, but as someone who said that, and then did it, I have a few suggestions.

First, if it had been that easy. There was work to manage, property to find and (rent or buy), and attempting to find a way to economically survive post a move. And of course, the move needed to be legal, or there would be no difference between us and an economic migrant trying to sneak into Europe by boat.
So for those of you who really mean it, let me give just a few suggestions based on having actually said it, and then done it.

1. Make the personal commitment. Talk to yourself, you spouse, family. Make sure that everyone is, if not supportive, then understanding. But also test yourself - am I just saying this, or do I really, really mean it?

2. Plan. Long in advance. Get as much ready and thought out as you can. Depending on who wins, you may find yourself at the back of a very long queue of people who feel the same way. There may not be a million economic or political refugees streaming north and south across American borders into countries with makeshift refugee camps, but there will be a queue to speak to someone at a consulate or embassy, delays for passports and visas, and limited jobs already being taken by those in front of you.

3. Where? Not such an easy question. Canada; well maybe. But the real question is; where in the world will I feel at home, has what I need in infrastructure, and is politically acceptable to me (after all, you will be leaving because of a politically unacceptable outcome. One rule-of-thumb, you are NOT going on holiday, so if you've been somewhere on holiday and said "I could live here", you probably either cannot, or would not want to year round.

So what are your criteria? May I suggest the following:

a. Language: how important is language to you, or do you speak a second language, which will certainly help narrow down your choices. Learning a language is not easy, but is possible and can be huge fun. It can also be a huge hindrance to getting things done and enjoying yourself.

b. Political System: Are you happy with a totalitarian regime as long as they don't bother the foreigners, or do you demand a democratically elected government? Some very nice places are ruled by dictators or monarchs, yet are full of opportunity and fabulous people. Remember that you have NO say in that country, so be ready to leave your political opinions in the US when you leave.

c. Economy: If you are going to "retire" then the choices are much wider, but if you will need to work, you might want to consider developed economies. Associated with this is your ability to get a work visa or other authorization to earn a living in the country. Of course some countries are more "open" than others, and it does help to have a second citizenship.

d. Civil stability: Some countries have a higher potential (or current) for civil war, social unrest, or outright war with a neighbor. How safe do you want to feel? In some countries the overt oppression of minorities creates an environment of almost continual latent violence,  covered over by a patina of civility and culture.

e. Population density: Hey, we all want to be in the country, right? But realistically, most people live in cities, and some very attractive countries are effectively city-states. Remember also that Islands are wonderful, with beaches (most) and sunshine (many) but they are islands, and if you will suffer from "island fever". That applies to almost all islands, from the UK down to Singapore.

f. Weather: After all, if you want to ski and like winter, then Dubai probably isn't for you. Likewise, escaping winter seems to be a huge draw. Florida isn't full because New Yorkers can't get enough snow. I like some seasons, but not too much hot or too much cold. More important, my wife loathes the cold, so that is a major factor.

g. Distance: Never forget the tyranny of distance. If you need to be close to family and friends, then consider just how far you are willing to be, and how long it will take you to get "home" if that is what you will still call it. New Zealand may be heaven on earth, but it is 24 - 36 elapsed hours of travel from North America or Europe, meaning visitors effectively need to dedicate two weeks to make the trip worthwhile, and so will you going "home" for a visit.

You may have additional criteria of your own. Food, wine, sunshine, opportunities to work in IT, Risk, Accounting, Oil & Gas, etc.

4. Meet the Natives. Well, at least people from that country. Hear from them the pluses and minuses, and ask them why they do not live there. Your assumptions about a place will be reinforced or corrected by getting to know people - the kind of people that will be around you every day. These people will also provide you with great pointers on how to settle in, and with good contact in-country. Their networks will be invaluable to you.

5. Visit. So you've picked a few places (or only one), met and talked with people from there, now it is time to make your knowledge a bit more real; go there. Spend a week, or two or more. Do not look at it as a tourist, look at it as a resident. What do the supermarkets look like. Talk to local headhunters (if you are in an easily transportable profession).

You are now about as ready as you ever will be, and all that remains is for you to watch the November night results.

Of course there is the risk, that after doing all your prep, you may reach the conclusion that it doesn't really matter who wins, it is time to go.

Stop talking about Austerity as you have no idea what that means

It is disgusting to hear the British and French bleat on about the horrors of Austerity, as if they actually had any idea of what they are talking about.

My friend Andrew Brice in Wellington, New Zealand has produced some simple but effective graphs that showing GDP growth across the world from 1994 to 2014. Looking at the graphs for somewhere like Greece, and you quickly see what Austerity really means.He is graphing World Bank data since 1994 on a range of economic data points for all countries. While not setting out to show "Austerity", the graphical presentation does provide some interesting information. His site can be found here.

I've selected four countries for the chart below: France, Greece, Spain and the United Kingdom.

Notice how the GDP points expand fairly uniformly for France and the UK. Each point on the spider diagram, for the three reference years, shows growth, indicating and reasonably balanced growing of the various key elements of GDP.

Not Greece, in which that growth virtually implodes for 4 of the five factors between 2004 and 2014. Only 'X' - Exports, continues to grow, and that at a slower rate than the previous decade. Household consumption, General government, Gross capital formation and Imports all collapsed. Gross Capital Formation is less than it was in 1994.

Spain looks only marginally better.

Yet for the UK and France, all five indicators continue to expand through the crisis and into the second decade of this century.

GDP growth graphs for http://zyaneconomics.appspot.com/#/finmodel/

In the UK and France, governments have attempted to bring spending under control, and in large measure have failed miserably.

Oxfam's report on Austerity in the UK is a wonderful example of not understanding reality. "Since 2010, austerity – primarily in the form of deep spending cuts with comparatively small increases in tax – has been the UK government’s dominant fiscal policy, with far fewer measures to stimulate the economy. The stated aim of austerity was to reduce the deficit in the UK to give confidence to the markets and therefore deliver growth to the economy. While austerity measures have had some impact on reducing the deficit, they have delivered little growth, and public debt has risen from 56.6 per cent of GDP in July 2009 to 90 per cent of GDP (£1.39 trillion) in 2013."

It is almost as if "Austerity" actually only means "we cannot have everything that we want". Economies just balance what is required to keep the lights on, tax rates that do not disincentive investment, balanced against social programmes that effectively avoid rioting and revolution. In which case Austerity has become the a rejection of a "give me mine" mentality.

Yet contrast that with 10 things the Greeks cannot do (from July 2015 at the height of the crisis). If you want to see real austerity, look at Greece. Could the UK or French governments survive cutting pensions by greater than 50%. Or unemployment higher than 25% (and 50% for under 26 year olds)? What would Oxfam say to 45% of pensioners living below the poverty level, and food consumption dropping by almost 30%?

United Kingdom

Looking at the GPD growth chart for the UK it is almost easy to see the source of discontent. Yet it needs to be remembered that the economy has continued to grow (once over the Global Financial Crisis - GFC - induced great recession) and is now larger then it was in 2008.

UK GDP Growth, 1994 - 2014
Note the continued expansion of all five elements

 
Personal income has (as of 2015) grown to exceed personal income, inflation adjusted, pre-GFC. It took a long to time recover, and certainly the average POME (Prisoner of Mother England, or is that short for Pomme de Terre?) has had a rough ride. But pensions have continued to be paid, the health service has continued to treat patients, and to expand the range of coverage and care provided. The economic effectiveness of that service may be up to question, but that is a factor of quality of provision, not total expenditure in GDP terms.

France

France is not significantly different, with growth across all five data points through the years. Yet France (and the French) are mired in a psychological paradigm that says that they are suffering, oh so horribly, from massive austerity. Each new president is elected on a promise of change, or in the case of Sarkozy, "rupture" with the past. Yet for twenty years, each new president has been met by strikes at the mere hint of market reform legislation, strikes lasting weeks and covering the entire country sometimes. Each president has caved. Even the French military has a better (much) record of refusing to surrender.

France GDP Growth, 1994 - 2014
Not bad for coming through the GFC

Yet looking at the image above, you would think that France has had fairly steady growth, especially when you consider that between 2004 and 2014 there was the GFC knocking their economy into deep recession, and their being in a Europe that has seen lackluster growth at best over the past half decade.

Greece

Turning to Greece, we see a very different graph, in which the only growth has been in exports. The years between 1994 and 2004 showed good growth, in line with the UK and France. Yet with the GFC and their debt crisis, loss of sovereignty and destruction of the social welfare system, the years 2004 and 2014 we can see what austerity really means.

Greek GDP Growth, 1994 - 2014

The collapse in Greek GDP growth has been across the board, with only exports growing past 2004 levels, and that only marginally. The other four indicators have all collapsed, with Gross capital formation falling to below 1994 levels.

Compare that to the GDP performance of Greece's four land-border neighbours; Albania, Bulgaria, Macedonia (well, okay, the Former Yugoslav Republic of Macedoia to give it the official name) and Turkey. All four have experienced consistent and continual GDP growth.

 These countries have come through revolutions, civil wars and military dictatorships, but have then spent 20 years growing. And growing. Meanwhile their Eurozone neighbour has suffered at the hands of creditors and "friendly" governments. "But it's all the Greeks fault, they are perfidious and profligate, and they borrowed the money". All true (well, except the perfidious). Yet looking at the rouges gallery of neighbours, can we really say that the Greeks are any worse?

Greek is in austerity. And this is real austerity; the kind that results from the markets losing faith, and the bankers engaging in as much Moral Hazard as the Greek government itself. Yet when the bill came due, the banks (as effectively representatives of other governments or the ECB and IMF) decided that only one side of the perfidious (and here I mean it) cabal would pay.

Summary

The United Kingdom and France should, to use the English colloquialism, "shut their pie-holes". They are not in austerity, and do not actually know that it means. They are living *slightly* above above their means, but continuing to borrow like drunken sailors.

True Austerity is Greece, and this is in their futures when the markets say "enough". Then we will see real austerity in those two countries, as government debt becomes unavoidable and unsustainable. Greece saw:

– 25%: Fall of gross domestic product
– 28%: Reduction in public sector employees
– 28.5%: Drop in food consumption
– 61%: Drop in average pension (833 euro)
– 45%: Number of pensioners living below the poverty line
– 26%: unemployment (50% at ages under 25)

This is the real face of austerity, and something the UK and France should really fear. Today's weak attempts to controls spending are only a start, and a poor one at that.