My Thoughts On Brexit

I haven’t written a post in a long time. My blog was mostly an attempt to piece together and understand the 2008 financial crisis, and the various consequences of it.

One pretty big consequence, at least in my home country, the United Kingdom, has been Brexit.

I didn’t vote in the 2016 referendum. Mostly because I was at that time I was living abroad in the United States with my father, having moved there the previous year, and I had trouble applying for an overseas postal vote.

I probably would have voted remain, but I’m not hugely committed to either side. I see huge problems with the European Union. Look at what has happened to the euro area countries such as Greece, Spain, Portugal, and Italy who got into trouble in the financial crisis. They ended up going through years of grinding deflationary austerity measures inflicted onto them by Germany, the ECB, and the IMF. Trying to piece together a European monetary union without a fiscal union has been an utter failure.

Of course, I don’t think that many leave voters in the UK were particularly concerned about the fate of Greece, and so forth. Brexit was really about us. The UK for the most part has never been particularly europhilic, or committed to European federalism. I grew up in Stoke-on-Trent, one of the most heavily leave supporting areas in the country, and the people I grew up around identified overwhelmingly as English. Not even British, and certainly not European.

If you throw the financial crash and eight years of austerity into the mix, is it at all surprising that people voted to look after their own island instead of sending money over to Europe, when they never felt very European in the first place? After years of austerity, those slogans about millions of pounds of extra money for the NHS struck a lot of chords.

And although Britain in the EU is still one of the happiest, and healthiest, and most successful countries in the world, leavers believe we can be so much more than an island on the edge of a European federation. A third of the landmass of the planet used to be British. And now we’re just going to be a European province?

The remain campaign did not inspire people in this way, so it is not hugely surprising to me that they lost. I am a democrat, and I accept the result of the referendum. My rationale for voting remain would have been that I believe in the principle of working together with other countries, and also that it is risky to rock the boat, and make radical changes to our political system. The 2008 financial crisis was due to the excesses of the financial system that devolved into a casino, not the EU. The austerity inflicted on the UK from 2010-16 was a political choice by British politicians, not European ones. In many ways the EU has been unfairly scapegoated, and often in particularly strange ways, such as over the curvature of bananas.

But that doesn’t answer the basic identity issue. If people in the UK don’t feel European, they’re not going to want to be part of a European federal union. Technological progress (e.g. telecommunications, motorization, shipping containerization, aviation, etc) has brought the world together, but not to the extent where people are happy to give up their national boundaries.

Still, it was a close result, and that has led us to the deadlock we are in. At present the British government cannot pass any laws through parliament to secure Brexit as it does not have a majority. But it cannot dissolve parliament and have an election, as the opposition parties refuse to have one.

That is partly down to the awful and stupid Fixed Term Parliaments Act, brought into being by Cameron and Clegg’s coalition government. It is more importantly down to the utter failure of the political parties in parliament to cooperate and reach a Brexit compromise that delivers Brexit while also addressing the concerns of the large minority who wanted to remain. My perspective is always that the people and the country come before any kind of party loyalty, and there is absolutely nothing wrong with working together across different political parties. But I am not a politician, and I will never be a politician, and even if I was a politician I would have no ability to fuse together this ideologically divided rabble in parliament into something workable.

I don’t know how this is going to end.  For a long time, I expected that the struggle to compromise (both between leavers and remainers, and between the UK government and the EU) would just lead to a no deal Brexit. As someone who has looked at a lot of economic forecasts in my time, I do not necessarily expect this to be as awful as it is forecasted to be by government agencies. The UK has no reason to block the flow of essential goods such as food and medicine from the EU into Britain. So while a no deal Brexit would undoubtedly lead to disruption, it would be temporary disruption as British manufacturers would reorientate to sell their goods to different markets, such as the U.S., China, and the former British empire.

But the opposition has blocked this at every turn. And Boris Johnson does not seem to be committed to leaving the EU without a deal. Nigel Farage offered him an electoral pact based on a no deal Brexit, and he turned it down.

The compromise that brings parliament together might be another referendum, or as europhiles bizarrely call it a “people’s vote”, ignoring the fact that there was already one people’s vote in 2016, the result of which hasn’t been fulfilled. The remain position seems to be to have another referendum, and hope they win. Leavers, obviously, resist this.

To me, the problem stems from the 2016 referendum being badly organized. David Cameron had no plan to leave the EU, or to deliver on any result other than remain. He only held the first referendum to silence the eurosceptics in his own political party. The day after the referendum, he quit. The Conservative Party then put Theresa May into power, who only weeks earlier had been campaigning to remain in the EU. Since then, the British government has been haphazardly improvising.

The deals that have been put before parliament seemed like a worst of both worlds situation to me. The UK would leave the EU, and leave behind any kind of say over European law, but continue to be bound by it. This may have been improved somewhat in the most recent deal negotiated by Johnson, where only Northern Ireland would continue to be integrated into the European system.

Of course, the next referendum will probably not even include a no deal option. The Labour Party and Liberal Democrats seem to be pushing for a referendum between the negotiated deal and remaining in the EU. This seems rather intellectually dishonest to me, as I think the first referendum settled the question of remain or leave. A second referendum should only be used to clarify the type of exit, lest it become a best of three situation. At least implement the result of the referendum. If that doesn’t work out, say, after 20 years, then surely the UK can rejoin the EU? (Although perhaps not, we have hardly shown ourselves to be committed to the European project, perhaps many European leaders will be happy to be rid of us?)

I think more than anything else, the situation has become very fatiguing. A lot of economic evidence is mounting to show that uncertainty is becoming a very great problem. Businesses are struggling to commit to investment if they have no idea where the UK is going to be in five years or ten years time. Until Brexit is resolved, there is a very great degree of uncertainty. But even after Brexit, there will be a lot of different uncertainties. What shape will the new relationship between the UK and the EU have? Which countries will the UK sign trade deals with? What kinds of trade deals will these be?

So, the UK is in a bit of a political mess. Indeed, the UK itself may not exist for very much longer. The Scottish nationalists are pushing for another independence referendum, and the Irish nationalists are pushing for a united Ireland.

The UK is not showing much inclination to get out of its mess any time soon, either.


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