- BREXIT -
L UKE H ENDERSON
Brexit: I don’t have a vote but I do have an opinion
As a Dulwich College economics student, I have been fascinated by the recent departure of the UK from the EU both from an economic and personal perspective. I didn’t get a vote, but I do have a strong opinion; I’d like to explain why I believe the result is the wrong one for my generation. There is still uncertainty on the outcome with the Labour party in disarray, Scotland and London holding a strong view with over 60% wanting to remain in the EU, and no indication of when (or if) article 50 might be implemented. Therefore, a calm, informed discussion on this subject still could have an effect on the outcome. The democratic decision was close, though clear. Understandably there has been a strong backlash asking the government to revoke the public’s decision to leave the EU, but there are still reasons to stand by the outcome of this referendum. One of the most persuasive is to ‘take back control’ from what is widely seen as an inefficient, possibly corrupt, and certainly aloof unelected administration in Brussels. This bureaucratic system seems far removed from the best interests of the UK in the long and short term, and the expansion of the new countries has meant that UK ‘control’ recedes further as the EU grows. This strong feeling comes hand in hand with a desire for independence and a wish for the ‘good old days’; for Little Britain to rise once again, especially among the older demographic. There is widespread disillusion with the political classes creating a strong populist protest vote, although the logic of this is very weak - this ultimately life-changing decision is about leaving the EU, not choosing an alternative government. We could also argue that many people based their decision on the threat immigrants seemingly pose to people’s jobs and a general consensus that they don’t benefit the economy. The Leavers’ argument was that five more countries on the verge of joining the EU, such as Turkey (although that seems unlikely anytime soon), could lead to an exponential rise in migration of people to our country (as well as Germany and Western modern economies) and a threat to jobs and housing availability. On the economic side, leaving the EU gives the UK opportunities to expand their export interest to other countries such as China and other BRIC’s and NIC’s that are growing rapidly and could become key trading partners. Even if there are more tariffs to other countries, this potentially strengthens our economy because we would be forced to rely on ourselves in domestic products whilst solving the current account debts; killing two birds with one stone. According to Leave, we could also keep the money we currently send to the EU, all of the ‘£350 million’ to be part of the commission that we could spend on arguably more beneficial instruments to the UK economy (e.g. the NHS, although this was later retracted as a policy by the leave campaign). Finally, the depreciation of the pound we have already seen could be seen as a positive factor for the leave camp; with cheaper exports so, consequently, greater aggregate demand, although this would be a trade-off for a greater expense on imports. So there is a case to be made for leaving the EU. But the huge majority of economists and large analytical firms have overwhelmingly judged that it would be a bad idea to leave the EU. Why? We can safely say that guaranteed trade with the EU wouldn’t reach its previous level for several years after article 50 is implemented. Along with the free movement of people being restricted, the implications of this would be rises in wage prices due to less supply of workers to the market, therefore an increase in costs of production. So, if everything stayed the same, supply would actually fall causing a retraction of growth which
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