Brexit

So I was wrong about Brexit. I reasoned that if the majority were against Brexit (as has consistently been the case in polling since 2017) then it wouldn’t happen. But even in this post-truth age I cannot deny that on 31st January 2020 we legally left the EU. However that does not mean that Brexit is over. As Churchill said about the battle of El-Alamein, “This is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning”. Now that Brexit has really started I thought I would be a good time to record some of my thoughts on the topic.

Firstly, some quick self-reflections on why I got it wrong on Brexit. Fundamentally I did not think that the Conservatives could win a majority in an election based on a hard Brexit policy, given that this type of Brexit is a long way off majority support. I did not expect Johnson to purge his own party of non-believers so dramatically, I didn’t fully account for Brexit fatigue, and didn’t think that Labour and Corbyn would be as disappointing as they were during the election (which includes their own muddled and confusing Brexit policy which came two years too late). In the end Johnson persuaded enough people to grit their teeth and vote for him despite their concerns over Brexit.

The Cost of Freedom

The reasons for my opposition to Brexit are difficult to articulate verbally, so I think this blog is a good place for them. Most people in favour of Brexit recognise that the economic argument is against them. Nevertheless that infamous bus did influence the referendum outcome, so it is worth highlighting that Standard & Poor estimate that the cost of Brexit since the reference is £66bn, or £550m per week (mainly due to lost economic growth). Goldman Sachs put the value at £600m per week, and the Bank of England estimate £800m. Bloomberg Economics estimate that the cost has already reached £130bn and will surpass the £200bn mark the end of 2020, which is equivalent to the total sum of payments made to the EU during our 47 years of membership. This range does highlight the difficulty in making economic forecasts based on opportunity cost, but it should be remembered that we haven’t left the common market and customs union yet, so the impact of increased trade friction has not yet been felt.

My first fundamentally objection to Brexit is that it will not address any of the key problems in our society, and is therefore a monumental waste of time and resources. As an engineer I think that a good solution is one that addresses the root cause of a problem. The referendum and its result are a symptom of an unequal and divided society. The less well-off half of society has been largely ignored by successive governments during the era of neo-liberalism which we have lived through since the 1980s. Will Brexit allow us to address inequality? It is hard to see how. We have always had the tools available to us to address inequality, but have lacked the political will to do so. Indeed, history and the evidence available suggest that the cost of Brexit will fall disproportionally on the less well-off. More than that, one of the few visions of a post Brexit Britain that makes logical sense (i.e. explains why we would want to be outside the EU) is a ‘Singapore-on-Thames’ Britain with low tax and low regulation. This would in theory give us a competitive edge against the EU trading bloc and make us more attractive for foreign investment. However this vision is only advocated by a tiny minority of libertarian extremists, because the majority intuitively recognise that a low tax and low regulation state is not in their best interests (anyone who has tried to buy a property in London knows that foreign investment does not necessarily benefit the majority). Unfortunately for democracy, that tiny minority is noisy, wealthy, influential, and disproportionally represented in government. Therefore there is a very real risk that this vision will at least partially be realised due to Brexit, and it will make the problem of inequality worse than rather than improve it.

The Wrong Vision

Brexit represents a vision for this country and our place in the world which I fundamentally disagree with, and this is my second objection to it. I believe in the advantages of political integration and close relationships. The ultimate purpose of the EU is to prevent war in Europe by promoting political and economic integration. It has been very successfully in this purpose. This integration also makes it easier to tackle challenges that cross national borders, including climate change, terrorism and tax evasion. The most popular slogan during the referendum was ‘take back control’, which means taking back our national freedom from the EU (e.g. freedom from EU legislation). However freedom is a double edged sword, and for that reason we subconsciously choose not to be entirely free. This applies from the individual to the international level. The only way to achieve total freedom is to live as an anarchist outside of society, perhaps as a hermit living off wild berries. Even our friends constrain our freedom. For example we may decide we want to meet a friend for a drink, and find that we are not both available at the same time. We can choose to compromise and go at a time which isn’t ideal, or we may prioritise our freedom to go when we want, in which case we will be drinking alone. Brexit represents the latter choice. Libertarian extremists insist that free trade means national freedom, but like society itself they require compromises which constrain our freedom (for example we may have to accept deregulated food products from the U.S, relaxed visa controls from India, or regulatory alignment with the EU). The fact that these constraints be may be conflicting is an additional challenge.

So the trade agreements we now need to pursue represent compromises, and the extent that we need to accept compromise depends on our relative bargaining position. Before Brexit we negotiated as part of the EU, which is currently the world’s largest trading bloc and second largest economy in GDP terms, and as a result we achieved relatively advantages outcomes. The UK’s GDP at time of writing is ~$2.7 trillion compared to the EU’s GDP of ~$18.8 trillion. It is a simple logical fact that we are now in a far worse negotiating position and will need to accept far more compromise. While big countries get bigger and smaller ones club together, we in Britain are swimming against the tide. Many on the right are blinded to the reality of the situation by nationalist pride, and a nostalgic sense that we can recreate the world of the British Empire. Brexit then is much easier to agree with if you are a nationalist. Unfortunately there has always been a positive correlation between nationalism and racism. I recognise that not everyone who voted leave is a nationalist, and only a small minority are racists, but it is not a coincidence that the number of reports of racial hate crimes has increased dramatically in this country since the referendum. The problem is that nationalism is inextricably tied to the logic of Brexit. Brexit represents an inward looking nationalistic vision for Britain, which is naturally inclined to compete with rather than collaborate with other nations. Brexiteers like to claim a monopoly on patriotism and call the rest of us traitors. I consider myself a ‘patriot’ because I love my country and broadly speaking am proud to be British, but I do not think that Britain is ‘better’ than other countries. I recognise Britain’s weaknesses as well as its strengths, and the value of close collaboration with other countries, particularly our nearest neighbours the EU (both geographically and culturally).

Lets Fail Quickly

I worry about what Brexit has already done to the character of our society and our place in the world, and what it will do to us in the future. In a few short years we have gone from being a global leader within Europe (for example leading the global response to the 2008 Financial Crisis) to being an international basket case, and a source of both amusement and pity to other countries. Brexit represents a vision for this country which is both economically and morally wrong, and we will all suffer as a result (with the exception perhaps of the very wealthy). There are of course legitimate criticisms to be made about the EU as with any institution. For example it is too bureaucratic, and its legislature is too trigger happy when it comes to matters which are really national rather than international. However the right thing would have been to use our influence to reform the EU. Running away from the challenge is cowardly and not in our own best interests.

It is sometimes the case that in order for something to improve it must first be allowed to fail. This seems to be where we are with our relationship with the EU, and with British society more broadly. It could also be argued that a battle over competing visions for Britain will test both options more rigorously and ensure a better outcome. I would be more relaxed about this thought if it were 1990. In 2020 we face urgent crises (most urgently climate change but also the impact of new technologies such as AI) that will require functioning and cohesive societies, both at the national and international levels in order to address. We are almost out of time on climate change. I only hope that Brexit will fail as quickly as possible, so that we can move on with solving the real problems in our society.

One thought on “Brexit

  1. A logical, well-supported view, with a thoughtful appreciation of differing interpretations of the implications of recent events.

    Like

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