True enough, the capabilities of Magic haven’t been explored enough canonically to disprove that - but if the government learned of Magic, the first thing they’d do is subvert some wizards to their side, who might be able to counteract them - in many ways, it’s a battle of statecraft as it is of actual power.
But they were able to setup the core of their commercial and governance infrastructure in the middle of London, with no particular notice from muggles - not to mention, we know that the government already knows about wizards (MoM liaises with the PM). So there must be a quid pro quo already in place, with the government tolerating and aiding in the existence of a semi-independent polity in their heartlands in return for unspecified benefits, probably defence against foreign wizards.
True enough, the capabilities of Magic haven’t been explored enough canonically to disprove that - but if the government learned of Magic, the first thing they’d do is subvert some wizards to their side, who might be able to counteract them - in many ways, it’s a battle of statecraft as it is of actual power.
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But they were able to setup the core of their commercial and governance infrastructure in the middle of London, with no particular notice from muggles - not to mention, we know that the government already knows about wizards (MoM liaises with the PM). So there must be a quid pro quo already in place, with the government tolerating and aiding in the existence of a semi-independent polity in their heartlands in return for unspecified benefits, probably defence against foreign wizards.