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It's really incredible that three months after the vote, we still haven't the slightest idea what post-Brexit UK will look like. Will they go for the EEA (the l

by TillE 10y ago

It's really incredible that three months after the vote, we still haven't the slightest idea what post-Brexit UK will look like. Will they go for the EEA (the least destructive option), or will they - as Theresa May threatens - sacrifice everything just to limit immigration? Three months after the biggest decision in decades, and the subject is barely even being talked about seriously in the UK. I don't understand it.

martinko 10y ago
I think everyone in any position of power understands that they must remain in the single market - now the only question is how to position / sell this to the electorate.
- TheOtherHobbes 10y ago
  I don't think May and the Cabinet do. All the noises seem to suggest the real priority is xenophobia - i.e. immigration. ...Which is a purely political strategy to capture the continued support of leave voters - exactly the people whose lives will be destroyed when trade dries up. The problem is that the typical leave voter understands immigration because they have direct personal experience of immigrants. But leave voters don't understand the intricacies of trade deals, or the incredible damage poor trading conditions can do to an economy. May does, which is why she has been warning of "tough times ahead." If she was interested in continuing trade on realistic terms she wouldn't be saying that. My suspicion at this point is that the Tory party is willing to sacrifice the economic future of the UK in order to remain in power.
  - dogma1138 10y ago
    The typical leave voter lives in the areas with least immigration. The areas with any substantial immigration either from the EU or elsewhere voted remain.
    - barrkel 10y ago
      The places with the least immigration are usually the poorest places most fearful of immigrants taking their jobs (specifically, lowering their wages - and they're probably right) and least optimistic about the future. They are usually remnants of the industrial revolution getting marginalized by globalization (mostly China).
    - biofox 10y ago
      The sight of a few immigrants in an otherwise white British community is probably more shocking for the locals than it would be in a metropolitan area with a large immigrant population.
      - timthorn 10y ago
        The majority of immigrants from the EU are also white.
    - TheOtherHobbes 10y ago
      Aside from London, which is a special case, that's not particularly true. Remain won in the very big cities with urban cosmopolitan populations and in a few university towns, but lost almost everywhere else. There are two main groups of leavers, with some overlap - the working classes with limited education and low prospects, and the petit bourgeois, who are relatively poorly educated and uncurious but can be reasonably well off. The first group has direct experience of poor working conditions, and often lives in an area with immigration. They'll have seen wages being kept down first hand. This vote was enough to swing it for Leave in many working class areas. The second group may not have direct experience, but is easily persuaded by xenophobia and jingoism. They're often older and are nostalgic for an England that never really existed. They tend conservative - and Conservative. They like simple explanations to complicated problems, and they're easy marks for the British press - the real source of many of the UK's problems - which has been stoking their prejudices for decades with a constant stream of anti-EU scare stories. This pattern isn't unique to the UK, but so far the UK is the only country to stress test it.
      - deleted 10y ago
  - clappski 10y ago
    As far as I was aware it was the areas that the least amount of immigrants that wanted to vote for leave, but at this point it's moot. And I wouldn't say that fears over immigration are xenophobic, I think that the referendum came at a terrible time when Europe as a whole is facing a big refugee (economic or not) problem that they still can't decide how to solve.
    - deleted 10y ago
      [deleted]
    - mpweiher 10y ago
      >areas that [have] the least amount of immigrants that wanted to vote for leave Ironic, isn't it? But absolutely typical. In Germany as well, the areas with highest anti-immigrant sentiments (and voting etc.) are the ones with the least amount of actual immigrants. Which kind of makes sense when you think about it...
      - sbmassey 10y ago
        I don't see why it is ironic, really: areas of low immigration can see what happens to areas of high immigration, so will vote against it, whereas for areas with high immigration it is too late
        genofon 10y ago
        except that immigrants were not allow to vote for Brexit.
      - Scarblac 10y ago
        The people complaining are the people in areas with high unemployment. Migrants don't go there, they come to where the jobs are.
  - vixen99 10y ago
    Not all serious economists (who we can assume voted Leave) agree that Brexit is going to be economically harmful to the UK. Not all serious economic analyses suggest that Brexit will leave the UK permanently and materially poorer. The argument can be taken up with the following who we can assume voted (if they are or would be UK citizens) to leave the EU, and some of whom might well have some understanding of the intricacies of trade deals. Roger Bootle, Managing Director of Capital Economics, and Gerard Lyons, Economic advisor to the Mayor of London and former Chief Economist of Standard Chartered Bank. Ruth Lea, Warwick Lightfoot, Neil MacKinnon, Ryan Bourne, Head of Public Policy, Institute of Economic Affairs, Keith Boyfield, Executive Director, Keith Boyfield Associates, Professor Tim Congdon, Founder, International Monetary Research Ltd, Sean Corrigan, Hinde Capital, Mike Denham, Research Fellow, The TaxPayers’ Alliance, Bryan Gould, Former Labour Shadow Cabinet member & former vice-Chancellor, University of Waikato, Dr David Green, Chief Executive, CIVITAS, Dr Graham Gudgin, University of Cambridge, Dr. Oliver Hartwich, Executive Director, The New Zealand Initiative,Damon de Laszlo, Chairman, Economic Research Council, Graeme Leach, Former Chief Economist, Institute of Directors, Andrew Lilico, Chairman, Economists for Britain, Neil MacKinnon, Global Macro Strategist, VTB Capital,Dr Eileen Marshall, IEA Advisory Council, Professor Kent Matthews, Associate Dean for Engagement & Professor of Money and Banking, Cardiff University, Michael Petley, Chief Investment Officer, ECU Group, John Mills, Chairman and Founder of JML,Professor Patrick Minford, Professor of Economics, Cardiff Business School, Iain Murray, Vice President for Strategy, Competitive Enterprise Institute (Washington DC),David Myddelton, Professor D.R. Myddelton, Emeritus Professor of Finance and Accounting, Cranfield School of Management.Ross Parker, Brian Reading, former economics adviser to Edward Heath, Professor Colin Robinson, Advisory Council Institute of Economic Affairs & Emeritus Professor, Surrey University, Matthew Sinclair, Senior Consultant, Europe Economics, Professor Phil Whyman, Professor of Economics, Business, Economics and International Business, University of Central Lancashire,Dr Geoffrey Wyatt, Heriot-Watt University https://forbritain.org/economists/supporters/ https://forbritain.org/economists/supporters/
  - davidf18 10y ago
    The issue with immigration is not xenophobia but economic as Economist Branko Milanovic (and perhaps others) have been pointing out since 2012. Milanovic's now famous "Elephant Curve" shows that the working or middle class in developed countries have seen no wage growth in 20 years. Part of that effect is from exporting jobs to China, Mexico (for US), Eastern Europe (for Europe) and part of that is from importing unskilled/low skilled labor. 20 years ago Britain had 900,000 immigrants. Today they have 3.3 million. The British government promised to limit EU immigration to 100,000 last year but broke their promise: it exceeded 300,000. http://www.bloomberg.com/news/articles/2016-06-27/get-ready-to-see-this-globalization-elephant-chart-over-and-over-again http://www.bloomberg.com/news/articles/2016-06-27/get-ready-... These low-skilled immigrants compete for jobs in the UK and lower wage growth. Not those of professionals but of the working class/middle class. In the US, in 1970 we had 9.6 million immigrants (less than 5% of the population) and 2013 41.3 million (about 14% of the population). That does not include the 11 million immigrants in the US illegally. http://www.pewhispanic.org/2015/09/28/chapter-5-u-s-foreign-born-population-trends/ http://www.pewhispanic.org/2015/09/28/chapter-5-u-s-foreign-... As in the case of Britain, the working class in the US is suffering from the mostly low-educated immigrants that compete for jobs and drive down wage rates. The 11 million immigrants in the country illegally take jobs with illegal working conditions and illegally low wages since they can't complain. So, the issue is economic and not xenophobic. The real issue of BrExit and the rise of Trump is because the political and media elites in both countries (and this includes the Democrats as well as Republicans) have ignored the economic concerns of the working class.
    - rwmj 10y ago
      If it wasn't freedom of movement, it would be technological change (how many people will self-driving lorries put out of work?). The real problem is no one has thought about the long term where a lot of people either won't be able to work or won't need to work. In the UK we still have politicians who genuinely think a less than minimum wage job packing training shoes in a warehouse is morally better than someone being unemployed.
    - yummyfajitas 10y ago
      In the US the reason the middle class has had no wage growth is NOT because immigrants have hindered wage growth. The reason is simply because immigrants lower the averages simply by being included in statistics. In the US, most people with American parents have higher income than their parents did (in their 30's). This is true for all quintiles except maybe the top 20%. http://www.pewtrusts.org/~/media/legacy/uploadedfiles/wwwpewtrustsorg/reports/economic_mobility/pursuingamericandreampdf.pdf http://www.pewtrusts.org/~/media/legacy/uploadedfiles/wwwpew... Figure 1 http://www.urban.org/sites/default/files/alfresco/publication-pdfs/2000871-What-Would-Substantially-Increased-Mobility-from-Poverty-Look-Like.pdf http://www.urban.org/sites/default/files/alfresco/publicatio... Figure 5 Yet when we look at cross sectional statistics (rather than longitudinal ones), income (though not compensation) has remained flat. The way to square these two facts together is that George Jr. has a higher income at 30 than George Sr. did, but the average of George Jr. and Jose Jr. has lower income at 30 than George Sr. did. Jose Sr. is excluded from the cross-sectional statistics since he lived in Mexico in his 30's.
- danieldk 10y ago
  The problem is that it is not in the EU's best interest to give the UK the best possible deal, especially with many populist parties ready to request an exit if the UK deal works out well. The whole process will be immensely complicated: the deal should be bad enough for the UK to instil fear for an exit, but good enough to avoid an economic collapse.
  - tajen 10y ago
    > instill fear Is that how Europe is governed? I think any country should be allowed to leave without condescending comments by anyone. I prefer staying in Europe, but if the majority of my fellows prefer the opposite, then it's democracy. Who are we to judge they are "stupid", "country-side, or "senile", like I've read all across newspapers, or even fascists, like I've heard too? If Europe relies on hating the people who have a different opinion, twisting their vote to say it meant something else, and govern them with "fear" and "bad deal" (your words), then... ...then this is not the Europe I want to be part of.
    - rbanffy 10y ago
      I wouldn't mind if it's their informed opinion. What we see in this case is that they were sold a lie, one that'll eventually collapse into an ugly, harsh truth. The best deal possible is a Norway-like arrangement, which would be unacceptable to nationalists.
      - karma_vaccum123 10y ago
        Your comment basically confirms, on a more subtle level, what the GP post is saying. You have no factual basis for claiming these people are asserting false facts or voting based on false facts. Brexit is a vote on what the future should look like, and no one has a factual basis to predict the future. tl;dr people you disagree with aren't fraudulent by default
        aaronbrethorst 10y ago
        Demonstrably untrue: http://m.huffpost.com/uk/entry/uk_576d0aa3e4b08d2c5638fc17 http://m.huffpost.com/uk/entry/uk_576d0aa3e4b08d2c5638fc17 And in Trump's case (describing immigrants as "rapists" and "murderers") it is also demonstrably false http://www.wsj.com/articles/the-mythical-connection-between-immigrants-and-crime-1436916798 http://www.wsj.com/articles/the-mythical-connection-between-...
- T-A 10y ago
  Doesn't look that way, unless it's a really reckless negotiating tactic: http://www.bloomberg.com/news/articles/2016-09-03/may-s-brexit-red-lines-prompt-warning-from-european-commission http://www.bloomberg.com/news/articles/2016-09-03/may-s-brex...
- timthorn 10y ago
  No, there's a reasoned argument against the need to remain in the single market that has traction amongst politicians: http://www.conservativehome.com/thecolumnists/2016/09/daniel-hannan-repeat-after-me-single-market-membership-and-single-market-access-are-not-the-same-thing.html http://www.conservativehome.com/thecolumnists/2016/09/daniel...
jerven 10y ago
Problem is the EEA option depends on 31 veto possibilities !!! what will the UK have to give up to avoid those vetos? Not every country in the EU does a lot of trade with the UK and those will want their pound of flesh, now that the UK has foolishly put it on the table.
- eps 10y ago
  Vetoes are pretty much guaranteed, and not because of little trade with the UK, but as a warning to other EU members considering the UK route. You can't have the cake and eat it.
- dogma1138 10y ago
  I don't think there will be vetos renegotiations are comming up with Switzerland and later Norway, Denmark is also up for grabs so is Poland once the Euroblock exemption will expire. If the EU is über harsh on the UK, especially if it will come from either the Eurocrats like Juncker or from one of the smaller states it will not fly well with both EU and EEA members up for renegotiations.
michaelbuddy 10y ago
It's not just to 'limit immigration'. It was also to no remove the decidedly unneeded layer of unchecked lawmakers who at any time can run wild and criminalize UK citizens, who then have no recourse. Given that the UK economy is doing well, what is there to talk about? Most people are relieved to have that monkey off their back.
- tfgg 10y ago
  > ... unchecked lawmakers who at any time can run wild and criminalize UK citizens ... Assuming you're referring to the EU Parliament, the EU has little say in UK criminal law -- as opposed to various cooperation agreements and bits of harmonizing how criminal justice is carried out. https://fullfact.org/europe/what-would-brexit-mean-criminal-justice/ https://fullfact.org/europe/what-would-brexit-mean-criminal-...
- joshvm 10y ago
  Those unchecked lawmakers were also responsible for a level of governmental oversight which is unprecedented anywhere else in the world. That's not a bad thing at all, but you can't sell Remain to an electorate by saying "The EU stops us doing stupid stuff to you". That monkey was responsible for a huge number of regulations which benefit EU citizens, again, because it forces the government to take action that they would otherwise be too unwilling or lazy to take.
  - rayiner 10y ago
    The U.K. already had plenty of government oversight. Why on earth does it need even more from bureaucrats in other countries?
    - tim333 10y ago
      A lot of it relates to trade so we could have the single market. If you're going to have a border free market where you can order your ingredients from any country you need them to be made to the same regulations.
    - 10y ago
no1youknowz 10y ago
There has been a flurry of activity behind the scenes. Philip Hammond was recently in China [1] and discussed the possibility of trade agreements with them and other representatives of other countries who were also there. Australia has already mentioned opening up trade agreements [2] with the UK as well. There is even talk of trading with the common-wealth [3]. The point is this, things are moving forward. Just because it's not in the news. Which the majority it won't be until it's ready to be announced. Doesn't mean that nothing is happening. Also I don't know how old you are. But before the UK entered the EC which it was known back then. The UK was trading with the entire world. Now, it has the possibility of accessing the EU market AND trading with the world. Which I think is a great prospect for the UK. Edit: To address the downvotes. When the UK was trading within the EU. These trading agreements were done by the EU for all the member-states. They were negotiating as one trading block. Now that the UK is out of the EU. She can trade speaking for herself, not having veto's by France or another country. Go look it up. Also [4]: EU-US trade agreement fails. Now the UK is free to open up trade talks with the US. [1] http://www.bbc.co.uk/news/business-36877573 http://www.bbc.co.uk/news/business-36877573 [2] http://www.telegraph.co.uk/news/2016/09/03/g20-theresa-may-in-talks-over-a-free-trade-deal-with-australia-a/ http://www.telegraph.co.uk/news/2016/09/03/g20-theresa-may-i... [3] http://www.telegraph.co.uk/news/2016/07/29/a-bright-future-awaits-britain-post-brexit-in-the-commonwealth-m/ http://www.telegraph.co.uk/news/2016/07/29/a-bright-future-a... [4] http://www.express.co.uk/news/world/704752/EU-USA-trade-deal-talks-stalled-Germany-vice-chancellor-says-TTIP-failed http://www.express.co.uk/news/world/704752/EU-USA-trade-deal...
- madeofpalk 10y ago
  Was the UK not trading with the entire world when it was in the EU?
  - tim333 10y ago
    It's still in the EU and still trading with everyone. The kind of things we could change by leaving would be to say drop tariffs and subsidies on agriculture which would make food cheaper but put a lot of UK farmers out of business and so not be politically popular.
agumonkey 10y ago
GBP stopped falling though. Dunno if it's because brexit stalled or because the market thinks brexit will be fine.
- Scarblac 10y ago
  The second can't be true as long as nobody knows what Brexit is going to mean.
- dogma1138 10y ago
  The GBP stopped falling because the UK government spend about 250bln GBP to stop it from falling further.
  - agumonkey 10y ago
    Was it reported in mainstream news ?
    - porker 10y ago
      If you count the Financial Times as mainstream, yes.
      - agumonkey 10y ago
        Not my radar but mainstrean indeed.
  - wavefunction 10y ago
    They bought 250bln GBP, right? I'm no expert on monetary policy but I thought the way to counter a falling currency was to buy the currency with other foreign currency reserves.
  - blibble 10y ago
    the Bank of England offered to provide 250 billion of liquidity to banks, which is not the same thing as the government spending it buying foreign currency
Scarblac 10y ago
Maybe the best option is to have a big party and declare Brexit a huge success, without actually doing anything.
- tim333 10y ago
  I suspect we may end up with something close to that. Maybe a Norway option and a party.
  - varjag 10y ago
    Norway option includes taking its fair share of refugees along with the EU, and overall following the EU regulations. I thought the point of Brexit was against all that?
- deleted 10y ago
  [deleted]
tim333 10y ago
There was a very good article on the practical difficulties of leaving the EU successfully - "Everything you need to know about Theresa May’s Brexit nightmare in five minutes." Basically either you restrict immigration, lose free trade and screw the economy by mucking up decades of prior investments such as that by the Japanese or you go the Norway model where you still have EU immigration and budget payments but less say in what happens so a worse position than we now have. May promised "We're going to make a success of Brexit" but basically does not have the means to do that. What she can do is delay, do studies and so on hence the lack of progress.
- okket 10y ago
  Here is a link to the article you mentioned: http://www.politics.co.uk/blogs/2016/07/14/everything-you-need-to-know-about-theresa-may-s-brexit http://www.politics.co.uk/blogs/2016/07/14/everything-you-ne... I also find the following article very informative: "Brexit means Brexit – and that means there will be no debate on freedom of movement" http://www.independent.co.uk/voices/brexit-means-brexit-and-that-means-there-will-be-no-debate-on-freedom-of-movement-a7224066.html http://www.independent.co.uk/voices/brexit-means-brexit-and-...
  - tim333 10y ago
    That's a little scary if that is what happens. (The article suggests May will enact article 50 in Jan without significant trade concessions from the EU). Maybe time to sell up and short the FTSE.
wuschel 10y ago
Please correct me if I am wrong - as I understand, the referendum for the BREXIT is not binding. As such, there is a lot of fuss and hot air about things that will possibly not materialize. Not to mention all those speculative business affairs..
- m0nty 10y ago
  It isn't legally binding, and although the Prime Minister said she doesn't intend to consult parliament about it, parliament will still need to repeal the European Communities Act which took us into the EU in the first place. So they could say "no", but I think it unlikely in the current political climate. It is binding in the sense that it's "the will of the people", albeit by a slender margin, and it's kind of tricky to just ignore that. I personally suspect the Prime Minister is not highly committed to Brexit (she campaigned against it) but can't be seen to be "sabotaging" it by action or inaction, so she's got her game-face on. But she might come back later and say "it just won't work" or "Europe has offered us a better deal on immigration if we remain in", so let's have another referendum. > a lot of fuss and hot air about things that will possibly not materialize Or they might materialize, and it could turn out to be a Bad Thing, which is why people are worried about it. The continuation of the current status quo seems highly unlikely, whatever happens.
  - wuschel 10y ago
    I understand, thanks for elaborating on that matter. In a way, a clean way to do it would to be a call for elections, and a proper mandate - either to stay in, or stay out. But that might not happen, considering the nature of the political game. I agree about the reasons to worry, and to have a proper discussion. Things tend to get out of hand sometimes when it comes to media.
    - m0nty 10y ago
      > a clean way to do it would to be a call for elections Absolutely, but the weakness of the opposition Labour party and the near-annihilation of the Liberal Democrats at the last election mean (as things stand) it's mostly a foregone conclusion that the Conservatives will win. So to their way of looking at things, they will have two mandates to leave. It's an extraordinary situation, though. I said to my son on the morning the result was announced, this will affect all of us for the rest of our lives. I still don't think I was being hyperbolic. Seasoned politicians and commentators are saying it's our biggest political crisis since WW2 or Suez, and that's even coming from people who seem to support Brexit.
dominotw 10y ago
There is some early data When Economic Doomsayers Stumble: Cautionary Tales From Brexit, Grexit and U.S. Budget Battles http://www.wsj.com/articles/forecasts-of-brexit-gloom-may-be-overdone-1472406752?mod=e2twe http://www.wsj.com/articles/forecasts-of-brexit-gloom-may-be...
- yummyfajitas 10y ago
  I made the prediction on June 27 (the first trading day after Brexit) that all of this is overblown. Proof: https://twitter.com/stucchio/status/747493530277294082 https://twitter.com/stucchio/status/747493530277294082 I'm up 14% (67% annualized) on EWU (UK index) and VGK (Europe Index) since then - it's a nice chunk of money in my pocket. There are so many doomsayers here. When are you guys going to go short? It's a lot easier to criticize the outgroup than it is to put your money where your mouth is.
mikeash 10y ago
You'd think all those politicians campaigning for it would have worked out these details in advance. Too bad politicians actually doing their jobs doesn't seem to be in fashion these days.

by TillE 10y ago

martinko 10y ago

I think everyone in any position of power understands that they must remain in the single market - now the only question is how to position / sell this to the electorate.

TheOtherHobbes 10y ago
I don't think May and the Cabinet do. All the noises seem to suggest the real priority is xenophobia - i.e. immigration. ...Which is a purely political strategy to capture the continued support of leave voters - exactly the people whose lives will be destroyed when trade dries up. The problem is that the typical leave voter understands immigration because they have direct personal experience of immigrants. But leave voters don't understand the intricacies of trade deals, or the incredible damage poor trading conditions can do to an economy. May does, which is why she has been warning of "tough times ahead." If she was interested in continuing trade on realistic terms she wouldn't be saying that. My suspicion at this point is that the Tory party is willing to sacrifice the economic future of the UK in order to remain in power.
- dogma1138 10y ago
  The typical leave voter lives in the areas with least immigration. The areas with any substantial immigration either from the EU or elsewhere voted remain.
  - barrkel 10y ago
    The places with the least immigration are usually the poorest places most fearful of immigrants taking their jobs (specifically, lowering their wages - and they're probably right) and least optimistic about the future. They are usually remnants of the industrial revolution getting marginalized by globalization (mostly China).
  - biofox 10y ago
    The sight of a few immigrants in an otherwise white British community is probably more shocking for the locals than it would be in a metropolitan area with a large immigrant population.
    - timthorn 10y ago
      The majority of immigrants from the EU are also white.
  - TheOtherHobbes 10y ago
    Aside from London, which is a special case, that's not particularly true. Remain won in the very big cities with urban cosmopolitan populations and in a few university towns, but lost almost everywhere else. There are two main groups of leavers, with some overlap - the working classes with limited education and low prospects, and the petit bourgeois, who are relatively poorly educated and uncurious but can be reasonably well off. The first group has direct experience of poor working conditions, and often lives in an area with immigration. They'll have seen wages being kept down first hand. This vote was enough to swing it for Leave in many working class areas. The second group may not have direct experience, but is easily persuaded by xenophobia and jingoism. They're often older and are nostalgic for an England that never really existed. They tend conservative - and Conservative. They like simple explanations to complicated problems, and they're easy marks for the British press - the real source of many of the UK's problems - which has been stoking their prejudices for decades with a constant stream of anti-EU scare stories. This pattern isn't unique to the UK, but so far the UK is the only country to stress test it.
    - deleted 10y ago
- clappski 10y ago
  As far as I was aware it was the areas that the least amount of immigrants that wanted to vote for leave, but at this point it's moot. And I wouldn't say that fears over immigration are xenophobic, I think that the referendum came at a terrible time when Europe as a whole is facing a big refugee (economic or not) problem that they still can't decide how to solve.
  - deleted 10y ago
    [deleted]
  - mpweiher 10y ago
    >areas that [have] the least amount of immigrants that wanted to vote for leave Ironic, isn't it? But absolutely typical. In Germany as well, the areas with highest anti-immigrant sentiments (and voting etc.) are the ones with the least amount of actual immigrants. Which kind of makes sense when you think about it...
    - sbmassey 10y ago
      I don't see why it is ironic, really: areas of low immigration can see what happens to areas of high immigration, so will vote against it, whereas for areas with high immigration it is too late
      - genofon 10y ago
        except that immigrants were not allow to vote for Brexit.
    - Scarblac 10y ago
      The people complaining are the people in areas with high unemployment. Migrants don't go there, they come to where the jobs are.
- vixen99 10y ago
  Not all serious economists (who we can assume voted Leave) agree that Brexit is going to be economically harmful to the UK. Not all serious economic analyses suggest that Brexit will leave the UK permanently and materially poorer. The argument can be taken up with the following who we can assume voted (if they are or would be UK citizens) to leave the EU, and some of whom might well have some understanding of the intricacies of trade deals. Roger Bootle, Managing Director of Capital Economics, and Gerard Lyons, Economic advisor to the Mayor of London and former Chief Economist of Standard Chartered Bank. Ruth Lea, Warwick Lightfoot, Neil MacKinnon, Ryan Bourne, Head of Public Policy, Institute of Economic Affairs, Keith Boyfield, Executive Director, Keith Boyfield Associates, Professor Tim Congdon, Founder, International Monetary Research Ltd, Sean Corrigan, Hinde Capital, Mike Denham, Research Fellow, The TaxPayers’ Alliance, Bryan Gould, Former Labour Shadow Cabinet member & former vice-Chancellor, University of Waikato, Dr David Green, Chief Executive, CIVITAS, Dr Graham Gudgin, University of Cambridge, Dr. Oliver Hartwich, Executive Director, The New Zealand Initiative,Damon de Laszlo, Chairman, Economic Research Council, Graeme Leach, Former Chief Economist, Institute of Directors, Andrew Lilico, Chairman, Economists for Britain, Neil MacKinnon, Global Macro Strategist, VTB Capital,Dr Eileen Marshall, IEA Advisory Council, Professor Kent Matthews, Associate Dean for Engagement & Professor of Money and Banking, Cardiff University, Michael Petley, Chief Investment Officer, ECU Group, John Mills, Chairman and Founder of JML,Professor Patrick Minford, Professor of Economics, Cardiff Business School, Iain Murray, Vice President for Strategy, Competitive Enterprise Institute (Washington DC),David Myddelton, Professor D.R. Myddelton, Emeritus Professor of Finance and Accounting, Cranfield School of Management.Ross Parker, Brian Reading, former economics adviser to Edward Heath, Professor Colin Robinson, Advisory Council Institute of Economic Affairs & Emeritus Professor, Surrey University, Matthew Sinclair, Senior Consultant, Europe Economics, Professor Phil Whyman, Professor of Economics, Business, Economics and International Business, University of Central Lancashire,Dr Geoffrey Wyatt, Heriot-Watt University https://forbritain.org/economists/supporters/ https://forbritain.org/economists/supporters/
- davidf18 10y ago
  The issue with immigration is not xenophobia but economic as Economist Branko Milanovic (and perhaps others) have been pointing out since 2012. Milanovic's now famous "Elephant Curve" shows that the working or middle class in developed countries have seen no wage growth in 20 years. Part of that effect is from exporting jobs to China, Mexico (for US), Eastern Europe (for Europe) and part of that is from importing unskilled/low skilled labor. 20 years ago Britain had 900,000 immigrants. Today they have 3.3 million. The British government promised to limit EU immigration to 100,000 last year but broke their promise: it exceeded 300,000. http://www.bloomberg.com/news/articles/2016-06-27/get-ready-to-see-this-globalization-elephant-chart-over-and-over-again http://www.bloomberg.com/news/articles/2016-06-27/get-ready-... These low-skilled immigrants compete for jobs in the UK and lower wage growth. Not those of professionals but of the working class/middle class. In the US, in 1970 we had 9.6 million immigrants (less than 5% of the population) and 2013 41.3 million (about 14% of the population). That does not include the 11 million immigrants in the US illegally. http://www.pewhispanic.org/2015/09/28/chapter-5-u-s-foreign-born-population-trends/ http://www.pewhispanic.org/2015/09/28/chapter-5-u-s-foreign-... As in the case of Britain, the working class in the US is suffering from the mostly low-educated immigrants that compete for jobs and drive down wage rates. The 11 million immigrants in the country illegally take jobs with illegal working conditions and illegally low wages since they can't complain. So, the issue is economic and not xenophobic. The real issue of BrExit and the rise of Trump is because the political and media elites in both countries (and this includes the Democrats as well as Republicans) have ignored the economic concerns of the working class.
  - rwmj 10y ago
    If it wasn't freedom of movement, it would be technological change (how many people will self-driving lorries put out of work?). The real problem is no one has thought about the long term where a lot of people either won't be able to work or won't need to work. In the UK we still have politicians who genuinely think a less than minimum wage job packing training shoes in a warehouse is morally better than someone being unemployed.
  - yummyfajitas 10y ago
    In the US the reason the middle class has had no wage growth is NOT because immigrants have hindered wage growth. The reason is simply because immigrants lower the averages simply by being included in statistics. In the US, most people with American parents have higher income than their parents did (in their 30's). This is true for all quintiles except maybe the top 20%. http://www.pewtrusts.org/~/media/legacy/uploadedfiles/wwwpewtrustsorg/reports/economic_mobility/pursuingamericandreampdf.pdf http://www.pewtrusts.org/~/media/legacy/uploadedfiles/wwwpew... Figure 1 http://www.urban.org/sites/default/files/alfresco/publication-pdfs/2000871-What-Would-Substantially-Increased-Mobility-from-Poverty-Look-Like.pdf http://www.urban.org/sites/default/files/alfresco/publicatio... Figure 5 Yet when we look at cross sectional statistics (rather than longitudinal ones), income (though not compensation) has remained flat. The way to square these two facts together is that George Jr. has a higher income at 30 than George Sr. did, but the average of George Jr. and Jose Jr. has lower income at 30 than George Sr. did. Jose Sr. is excluded from the cross-sectional statistics since he lived in Mexico in his 30's.
danieldk 10y ago
The problem is that it is not in the EU's best interest to give the UK the best possible deal, especially with many populist parties ready to request an exit if the UK deal works out well. The whole process will be immensely complicated: the deal should be bad enough for the UK to instil fear for an exit, but good enough to avoid an economic collapse.
- tajen 10y ago
  > instill fear Is that how Europe is governed? I think any country should be allowed to leave without condescending comments by anyone. I prefer staying in Europe, but if the majority of my fellows prefer the opposite, then it's democracy. Who are we to judge they are "stupid", "country-side, or "senile", like I've read all across newspapers, or even fascists, like I've heard too? If Europe relies on hating the people who have a different opinion, twisting their vote to say it meant something else, and govern them with "fear" and "bad deal" (your words), then... ...then this is not the Europe I want to be part of.
  - rbanffy 10y ago
    I wouldn't mind if it's their informed opinion. What we see in this case is that they were sold a lie, one that'll eventually collapse into an ugly, harsh truth. The best deal possible is a Norway-like arrangement, which would be unacceptable to nationalists.
    - karma_vaccum123 10y ago
      Your comment basically confirms, on a more subtle level, what the GP post is saying. You have no factual basis for claiming these people are asserting false facts or voting based on false facts. Brexit is a vote on what the future should look like, and no one has a factual basis to predict the future. tl;dr people you disagree with aren't fraudulent by default
      - aaronbrethorst 10y ago
        Demonstrably untrue: http://m.huffpost.com/uk/entry/uk_576d0aa3e4b08d2c5638fc17 http://m.huffpost.com/uk/entry/uk_576d0aa3e4b08d2c5638fc17 And in Trump's case (describing immigrants as "rapists" and "murderers") it is also demonstrably false http://www.wsj.com/articles/the-mythical-connection-between-immigrants-and-crime-1436916798 http://www.wsj.com/articles/the-mythical-connection-between-...
T-A 10y ago
Doesn't look that way, unless it's a really reckless negotiating tactic: http://www.bloomberg.com/news/articles/2016-09-03/may-s-brexit-red-lines-prompt-warning-from-european-commission http://www.bloomberg.com/news/articles/2016-09-03/may-s-brex...
timthorn 10y ago
No, there's a reasoned argument against the need to remain in the single market that has traction amongst politicians: http://www.conservativehome.com/thecolumnists/2016/09/daniel-hannan-repeat-after-me-single-market-membership-and-single-market-access-are-not-the-same-thing.html http://www.conservativehome.com/thecolumnists/2016/09/daniel...

jerven 10y ago

Problem is the EEA option depends on 31 veto possibilities !!! what will the UK have to give up to avoid those vetos? Not every country in the EU does a lot of trade with the UK and those will want their pound of flesh, now that the UK has foolishly put it on the table.

eps 10y ago
Vetoes are pretty much guaranteed, and not because of little trade with the UK, but as a warning to other EU members considering the UK route. You can't have the cake and eat it.
dogma1138 10y ago
I don't think there will be vetos renegotiations are comming up with Switzerland and later Norway, Denmark is also up for grabs so is Poland once the Euroblock exemption will expire. If the EU is über harsh on the UK, especially if it will come from either the Eurocrats like Juncker or from one of the smaller states it will not fly well with both EU and EEA members up for renegotiations.

michaelbuddy 10y ago

It's not just to 'limit immigration'. It was also to no remove the decidedly unneeded layer of unchecked lawmakers who at any time can run wild and criminalize UK citizens, who then have no recourse. Given that the UK economy is doing well, what is there to talk about? Most people are relieved to have that monkey off their back.

tfgg 10y ago
> ... unchecked lawmakers who at any time can run wild and criminalize UK citizens ... Assuming you're referring to the EU Parliament, the EU has little say in UK criminal law -- as opposed to various cooperation agreements and bits of harmonizing how criminal justice is carried out. https://fullfact.org/europe/what-would-brexit-mean-criminal-justice/ https://fullfact.org/europe/what-would-brexit-mean-criminal-...
joshvm 10y ago
Those unchecked lawmakers were also responsible for a level of governmental oversight which is unprecedented anywhere else in the world. That's not a bad thing at all, but you can't sell Remain to an electorate by saying "The EU stops us doing stupid stuff to you". That monkey was responsible for a huge number of regulations which benefit EU citizens, again, because it forces the government to take action that they would otherwise be too unwilling or lazy to take.
- rayiner 10y ago
  The U.K. already had plenty of government oversight. Why on earth does it need even more from bureaucrats in other countries?
  - tim333 10y ago
    A lot of it relates to trade so we could have the single market. If you're going to have a border free market where you can order your ingredients from any country you need them to be made to the same regulations.
  - 10y ago

no1youknowz 10y ago

There has been a flurry of activity behind the scenes. Philip Hammond was recently in China [1] and discussed the possibility of trade agreements with them and other representatives of other countries who were also there. Australia has already mentioned opening up trade agreements [2] with the UK as well. There is even talk of trading with the common-wealth [3]. The point is this, things are moving forward. Just because it's not in the news. Which the majority it won't be until it's ready to be announced. Doesn't mean that nothing is happening. Also I don't know how old you are. But before the UK entered the EC which it was known back then. The UK was trading with the entire world. Now, it has the possibility of accessing the EU market AND trading with the world. Which I think is a great prospect for the UK. Edit: To address the downvotes. When the UK was trading within the EU. These trading agreements were done by the EU for all the member-states. They were negotiating as one trading block. Now that the UK is out of the EU. She can trade speaking for herself, not having veto's by France or another country. Go look it up. Also [4]: EU-US trade agreement fails. Now the UK is free to open up trade talks with the US. [1] http://www.bbc.co.uk/news/business-36877573 http://www.bbc.co.uk/news/business-36877573 [2] http://www.telegraph.co.uk/news/2016/09/03/g20-theresa-may-in-talks-over-a-free-trade-deal-with-australia-a/ http://www.telegraph.co.uk/news/2016/09/03/g20-theresa-may-i... [3] http://www.telegraph.co.uk/news/2016/07/29/a-bright-future-awaits-britain-post-brexit-in-the-commonwealth-m/ http://www.telegraph.co.uk/news/2016/07/29/a-bright-future-a... [4] http://www.express.co.uk/news/world/704752/EU-USA-trade-deal-talks-stalled-Germany-vice-chancellor-says-TTIP-failed http://www.express.co.uk/news/world/704752/EU-USA-trade-deal...

madeofpalk 10y ago
Was the UK not trading with the entire world when it was in the EU?
- tim333 10y ago
  It's still in the EU and still trading with everyone. The kind of things we could change by leaving would be to say drop tariffs and subsidies on agriculture which would make food cheaper but put a lot of UK farmers out of business and so not be politically popular.

agumonkey 10y ago

GBP stopped falling though. Dunno if it's because brexit stalled or because the market thinks brexit will be fine.

Scarblac 10y ago
The second can't be true as long as nobody knows what Brexit is going to mean.
dogma1138 10y ago
The GBP stopped falling because the UK government spend about 250bln GBP to stop it from falling further.
- agumonkey 10y ago
  Was it reported in mainstream news ?
  - porker 10y ago
    If you count the Financial Times as mainstream, yes.
    - agumonkey 10y ago
      Not my radar but mainstrean indeed.
- wavefunction 10y ago
  They bought 250bln GBP, right? I'm no expert on monetary policy but I thought the way to counter a falling currency was to buy the currency with other foreign currency reserves.
- blibble 10y ago
  the Bank of England offered to provide 250 billion of liquidity to banks, which is not the same thing as the government spending it buying foreign currency

Scarblac 10y ago

Maybe the best option is to have a big party and declare Brexit a huge success, without actually doing anything.

tim333 10y ago
I suspect we may end up with something close to that. Maybe a Norway option and a party.
- varjag 10y ago
  Norway option includes taking its fair share of refugees along with the EU, and overall following the EU regulations. I thought the point of Brexit was against all that?
deleted 10y ago
[deleted]

tim333 10y ago

There was a very good article on the practical difficulties of leaving the EU successfully - "Everything you need to know about Theresa May’s Brexit nightmare in five minutes." Basically either you restrict immigration, lose free trade and screw the economy by mucking up decades of prior investments such as that by the Japanese or you go the Norway model where you still have EU immigration and budget payments but less say in what happens so a worse position than we now have. May promised "We're going to make a success of Brexit" but basically does not have the means to do that. What she can do is delay, do studies and so on hence the lack of progress.

okket 10y ago
Here is a link to the article you mentioned: http://www.politics.co.uk/blogs/2016/07/14/everything-you-need-to-know-about-theresa-may-s-brexit http://www.politics.co.uk/blogs/2016/07/14/everything-you-ne... I also find the following article very informative: "Brexit means Brexit – and that means there will be no debate on freedom of movement" http://www.independent.co.uk/voices/brexit-means-brexit-and-that-means-there-will-be-no-debate-on-freedom-of-movement-a7224066.html http://www.independent.co.uk/voices/brexit-means-brexit-and-...
- tim333 10y ago
  That's a little scary if that is what happens. (The article suggests May will enact article 50 in Jan without significant trade concessions from the EU). Maybe time to sell up and short the FTSE.

wuschel 10y ago

Please correct me if I am wrong - as I understand, the referendum for the BREXIT is not binding. As such, there is a lot of fuss and hot air about things that will possibly not materialize. Not to mention all those speculative business affairs..

m0nty 10y ago
It isn't legally binding, and although the Prime Minister said she doesn't intend to consult parliament about it, parliament will still need to repeal the European Communities Act which took us into the EU in the first place. So they could say "no", but I think it unlikely in the current political climate. It is binding in the sense that it's "the will of the people", albeit by a slender margin, and it's kind of tricky to just ignore that. I personally suspect the Prime Minister is not highly committed to Brexit (she campaigned against it) but can't be seen to be "sabotaging" it by action or inaction, so she's got her game-face on. But she might come back later and say "it just won't work" or "Europe has offered us a better deal on immigration if we remain in", so let's have another referendum. > a lot of fuss and hot air about things that will possibly not materialize Or they might materialize, and it could turn out to be a Bad Thing, which is why people are worried about it. The continuation of the current status quo seems highly unlikely, whatever happens.
- wuschel 10y ago
  I understand, thanks for elaborating on that matter. In a way, a clean way to do it would to be a call for elections, and a proper mandate - either to stay in, or stay out. But that might not happen, considering the nature of the political game. I agree about the reasons to worry, and to have a proper discussion. Things tend to get out of hand sometimes when it comes to media.
  - m0nty 10y ago
    > a clean way to do it would to be a call for elections Absolutely, but the weakness of the opposition Labour party and the near-annihilation of the Liberal Democrats at the last election mean (as things stand) it's mostly a foregone conclusion that the Conservatives will win. So to their way of looking at things, they will have two mandates to leave. It's an extraordinary situation, though. I said to my son on the morning the result was announced, this will affect all of us for the rest of our lives. I still don't think I was being hyperbolic. Seasoned politicians and commentators are saying it's our biggest political crisis since WW2 or Suez, and that's even coming from people who seem to support Brexit.

dominotw 10y ago

There is some early data When Economic Doomsayers Stumble: Cautionary Tales From Brexit, Grexit and U.S. Budget Battles http://www.wsj.com/articles/forecasts-of-brexit-gloom-may-be-overdone-1472406752?mod=e2twe http://www.wsj.com/articles/forecasts-of-brexit-gloom-may-be...

yummyfajitas 10y ago
I made the prediction on June 27 (the first trading day after Brexit) that all of this is overblown. Proof: https://twitter.com/stucchio/status/747493530277294082 https://twitter.com/stucchio/status/747493530277294082 I'm up 14% (67% annualized) on EWU (UK index) and VGK (Europe Index) since then - it's a nice chunk of money in my pocket. There are so many doomsayers here. When are you guys going to go short? It's a lot easier to criticize the outgroup than it is to put your money where your mouth is.

mikeash 10y ago

You'd think all those politicians campaigning for it would have worked out these details in advance. Too bad politicians actually doing their jobs doesn't seem to be in fashion these days.