On Brexit

IMG_20151230_132102351

It’s all over the news, so telling what’s happened is largely useless, if you are reading this blog it’s likely that you are into finance and UK getting out of Europe it’s something that shouldn’t have skipped your attention.

So UK voted out.

I have a lot of feelings for this milestone in our modern history, mostly because I am deeply linked to the “Evil Albion” since I was 18. That’s a long way away now, but England shaped and changed my life in a massive way and I cannot pretend that it doesn’t affect me since I do not live there anymore.

But let’s start with the financial bits and pieces. I believe that UK leaving the EU is really a massive step back for everyone. The fact that the EU even granted a series of special clauses to get the UK to remain in Europe apparently wasn’t even debated, all the political campaign pivoted on the “doom predictions” on one side and the “bloody foreigners give our job/money back” mantra.

Surely there were a lot of people who actually got some information and voted with an higher degree of knowledge, but from what I read around in blogs and newspapers it seems that there are a lot of people who vote leave just because “I never thought that Leave would win“. REALLY? Ok I’d better not comment that…

Financially UK has to renegotiate all treaties with Europe, taxes, free trade zone, work related agreements, laws. It’s not an easy or quick process and of course it will have its hidden and evident costs. As we didn’t have to worry about these points and now we do, so economically speaking it’s a step back.

GBP is likely to drop in value. Partly it has already, but in my opinion the run is not over yet. Add the likely loss of triple A credit rating (which they fought really hard to retain in recent years) and you’ve got yourself a good recipe for inflation and increased import prices. Weak pound might result in better exports, but the reality of it is that England is not an industrial country anymore, I believe that this point will be marginal.

The “financial safe heaven” of the City might loose some contributors and many multinational companies might need to relocate in European states (Ireland does a very good job at attracting these corps), but I feel that this argument is a bit weak. What is not weak is the fact that many companies will use this Brexit story to cut jobs, on this I am pretty sure.

Europe looses a very important partner, economically doesn’t loose much as the UK was draining a lot of finance thanks to the benefits that Mrs. Tatcher negotiated when the EU was starting. The Euro is going to get weaker and lots of extremists anti-EU parties are going to want to replicate the referendum in other countries. If the EU collapses it will be a very bad thing, if it manages to evolve into the USE (United States of Europe) then it’s a great step forward.

Still I believe that economically speaking is a loose-loose situation.

Then there is a social aspect which is more important in my opinion.

The vote stops freedom of traveling, free exchange, freedom of waking up and deciding to go to work in London or vice-versa. UK might soon be called “K”, as Scotland and Northern Ireland are likely to hold their own referendums to join Europe.

It’s a highly divisive vote, it seems to me that old generations voted for some sense of “British empire” that they still perceive but that, forgive me to say, seems a bit anachronistic in 2016. Young generations lost a lot of rights that they previously had in exchange of…

Yeah let’s see the “exchange”: for what I managed to understand 2 of the major payload of the Exit campaign were “use the 350 million pounds that we give every day to the EU for NHS (national health service)” and “stop immigration”. Within hours of the vote both these points were “retreated” by Farage and Johnson, the two leaders of the Exit campaign. One could argue that these are populistic slogans to attract votes, but judging from the reaction of the journalists they were not just propaganda shots… (see here)  On immigration apparently there has been a step back from a “kick them out” position to a “control them” one (which is what EU and UK were doing now anyhow).

Leaders like Farage represent extremist right wing ideas, easy to come up to the surface when there is a crisis in place as people have less and are more prone to these topics. But voting Leave is also giving these parties more power, and clearly has a ripple effect in other countries too. Socially this vote gives strength to these politicians and to me this is not goods news (remember a guy in Germany around 1930’s or another guy in Italy in the 20’s?).

How comes that people don’t see that united we stand stronger?

I am very disappointed at what happened, I didn’t think that the British people that I know would be capable of shooting in their foot like that, I have always had the impression that despite economic difficulties the backbone of England was still calm and responsible enough to look a bit further than the island’s pride (which in case of the link here on the left I find quite nice).

I was wrong.

Today I was thinking again at the whole Brexit story, I find extremely ironic (and sad) that if I had to do what I did 23 (yes twenty three) years ago, i.e. leave Italy and move to England to go to Uni like any other UK citizen, well… well… I couldn’t do it anymore!!!

At that time, the EU citizen status allowed me no visas, no permits, no Uni taxes (YES you read correctly, that changed later but at that time it was like this), ease of moving funds and travel. I thank England and my foolishness as an 18 year old for what they gave me, it was a key factor in becoming what I am today, and to me England will always be a second home. But the fact that tomorrow my kids will not have the same ease of moving there should they want to it’s a major loss, as a world citizen.

You know the worst part of it all? It’s me not being able to say to the UK “well, I hope all the best for you” and mean it. If it goes well for “them” it might mean that it goes bad for “us”… Them and us…

Can you see how shit this is?

Gutted.

 

 

Advertisements

8 thoughts on “On Brexit

  1. Hi Stal,
    Sadly in this day and age, most political campaigns seem to be driven by a message of fear rather than lead with inspiration and a positive vision. I guess it’s always easier to destroy than create. Even the concessions you mentioned further underscore the problems in the EU. Why is it necessary to essentially bribe countries to stay in what should be an obvious win-win union for all?

    I completely agree with you that that we’re all better together too; but my perception of the political side of the EU is that it’s a bureaucratic, undemocratic mess. I say that from afar as I’ve not lived in Europe for 16 years now. It would probably be better for the UK to become a state of the US than the EU in its current form.

    Long-term I think reason will prevail. There will still be travel, work and study exchange. The natural desire for both the UK and the EU to prosper will emerge and shape negotiations once the emotional reaction dies down. For that matter, internal turmoil within the UK may yet reverse the non-binding referendum result if another vote or national election is held.

    This whole saga reinforces the importance of voting for what you believe is the greater good. Not caring or voting is irresponsible and everyone should respect the freedom and democracy that millions of people have died to protect.

    Best wishes,
    -DL

    Like

  2. Ciao DL,

    Totally agree on several points. EU as it is now doesn’t work, full stop. It’s a bureaucratic mess and it’s not delivering what it was supposed to deliver. But “opting out” seems to me the easy way, rather than changing things for the better from the inside.
    I am not worried for the economy, travel and such. In the short run there will be bad effects, maybe in the long run things will get back similar to how they were before Brexit struck. What is not going to be the same is how people will feel and that’s the biggest part of the damage in my opinion.
    Voting is something that you should always do, unfortunately in modern democracies the percentages of voters are falling down more and more, it’s a terrible shame. But voting knowing what you are voting for it’s also necessary, casting a ballot because “today I feel anti EU” it’s just as bad as not voting at all.
    As to UK having special “rights”, that’s thanks to Mrs.Tatcher who negotiated the entry in the EU in a very hard way, getting the best that she could for England. On the other side EU was stronger with the UK presence (and vice-versa), even if that costed a little bit more. I guess it was part of the game and nobody ever mentioned it after that.

    Now you have Scotland who wants to break away, Cornwall who’s already complaining because they need the EU funds that they were getting, N.Ireland considering union with Ireland… I mean, it seem more of a mess now to be honest.

    On UK being another state of the US… Well, you are British, if I know the mentality a little bit I am sure that I am not wrong saying that “it’s never going to happen” 🙂

    It’s going to be a learning experience anyhow, I just hope that it’s not the beginning of another set of dark ages…

    Ciaociao
    Stal

    Like

  3. Stal,

    You say what is really important is how people feel…and later suggest people should know what they are voting for.

    My perception is that most people would end up voting on a ‘gut feeling’ rather than a careful analysis of all the facts. A feeling that the EU for whatever reason is not working for me is just as valid a reason as any other. We are, after all, just human with our individual secret fears and prejudices, our hang-ups and our neuroses. We are not all intellectuals with university degrees and the ability to take on board all the complexity of a decision to remain or leave.

    As for Scotland – not long ago they had their own in/out referendum and voted 55% to remain as part of the UK. As a region they voted to remain as part of the EU but must abide by the majority of the UK. There is no question of them leaving the UK and remaining part of the EU.

    Young people would rather remain in the EU however, whilst the turnout as a whole was over 72%, less than 40% of young people bothered to vote so I suppose you could say they have only themselves to blame – except most young people do not vote for anything unless they can do it on their smart phones.

    The EU is in a mess and I hope the vote to leave by the UK will be a wake-up call for some major reforms – but I honestly doubt they are capable.

    Although we will not be members in two years, the UK is still part of Europe and a very big economy so I am optimistic there will be plenty of cooperation on trade, the economy, security and wider social issues. Much existed before we joined and I see no reason why they could not continue.

    Finally, we retain our sense of humour and what comes to mind is the end of ‘Life of Brian’ where they are being crucified by the Romans and singing ‘Always Look on the Bright Side of Life’ (worth a look on youtube!)

    Like

    1. Ciao DIY,
      Thanks for stopping by! I am a huge fan of Monthy Pyton (well, I guess that one cannot live 5 years in the UK and not get to know them!!) 😀
      I agree that the vote will be a major wake up call for the EU, which cannot really go on like that…
      On Scotland I see that there is a lot of discontent, a lot of “Braveheart” feelings going on, maybe it’s the media in Europe, but the impression that I have is that they are going to be a pain in the ass for the UK. As to vote as one feels… No, I am more towards a responsible vote rather than a “gut feeling vote”, and my disappointment in the result comes from this, because I looked up at British people for their “Keep Calm/do the responsible thing” attitude which in my opinion faltered this time.
      At least on a technical matter you need to vote according to some evidence, it’s not a vote on abortion or euthanasia, where the feelings are the vast majority of the vote that one casts…
      Anyhow what’s done is done, I still think that there are some surprises down the way waiting for us…
      Ciao ciao
      Stal

      Like

  4. Ciao Stal,

    There are a lot of good things about the EU, but there has also been a lot of things that have been poisoned by the bureaucratic side of the EU. A lot of UK people do not want to be in a ‘United States of Europe’. Hopefully this doesn’t start a big financial problem.

    Tristan

    Like

  5. Ciao Tristan,
    I am not sure that “a lot of people” don’t want to be. The turnout of the election showed a good 30% not going to vote, and the result was very close, so in reality 30% or so of the population doesn’t want to be in the EU, the rest is either against this position or didn’t bother expressing an opinion. It’s funny how, days after the vote, all politicians that supported Leave “disappeared” a way or another. If I was a UK national I’d be really pissed at them, I find this behaviour to be totally irresponsible, one more proof that they did not expect to win and do not have a “plan”. Now it’s up to the new government, I still think that there is a chance that everything will be called off, once all the fuss subsides, reports that I read, also from UK newspapers say that there is a lot of people who voted Leave that are changing opinion, it’s not a clean cut situation I am afraid… Let’s see where it get up to, for sure the UK economically are going to take a hit (not just yet because nothing really happened apart from a fall in the Pound).
    Oh one point: if you want to trade with the EU you must abide to its regulations anyhow. So if you are in or out doesn’t change much the outcome for the exporters, but it changes the way you can affect determined policies…

    ciaociao

    Stal

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s