Sanction oligarchs by all means – but the sad truth is Britain depends on foreign money

theguardian.com:

Dirty Russian money has polluted British democracy. The Conservatives have taken donations from Vladimir Putin’s chums without asking enough questions about where the cash is coming from. It is time to clean up Londongrad and also to wave goodbye to a burgeoning list of sanctioned oligarchs that now includes the owner of Chelsea, Roman Abramovich.

That’s all completely true but it also doesn’t tell the whole story, which is that Russian money is just a part of an annual flow of foreign finance that enables us as a country to run permanent and massive trade deficits, where imports of goods and services are higher than exports. Put simply, we have been happy to take oligarch money so that we can live beyond our means. It is not just them, it is us.

There was a time – many decades ago – when trade deficits were a big deal. Politicians used to fret about them. They were front-page news. Famously, a bad set of trade figures was supposed to have cost Labour the 1970 general election (although they probably didn’t). But since the early 1980s, Britain’s trade deficit has got bigger and we have worried about it less. Instead, we worry about why so many of our leading football clubs have foreign owners, or why so many of the utility companies are no longer in UK hands.

A little known – but invaluable – government publication called the pink book helps explain why the two things are linked. The pink book provides an in-depth account of Britain’s balance of payments, which divides things up into a current account – which includes imports and exports of goods such as cars and computers, and trade in services such as banking or management consultancy – and a financial account that simply measures flows of money itself in and out of the