The Result and the Aftermath

Well it’s been an interesting week in politics. This blog was always going to be – first and foremost – a political blog and I’ll be doing more in the future; especially as both parties are now engaging in leadership contests (even if Labour’s is not fully declared yet). But first there’s the result – and its aftermath.

It was a surprise to a lot of people; though I wasn’t one of them (yes I know it’s very easy to say that now). My opinion at the time was that it would be close and could go either way; but it wasn’t an opinion I widely broadcast.

So what happened? In summary, I would say people voted with their hearts and for things they thought would make them and their families better off. Since so much has changed with an awful lot of things becoming clearer,  I thought I’d look back on the momentous day and what made the majority of those who voted, vote to Leave.

Wanting to spend more of our money on our services.

This was a very emotive reason and summed up in the famous “we can spend the £350m we send to the EU each week on the things we want” (even though it never was £350m as discussed earlier), it’s an emotive appeal and does make sense (though it does depend on what you mean by “we” – but that’s for another time). So how’s that working out?

It lasted barely 36 hours. It has been variously: played down as a misunderstanding, denied it was ever said, stated that the amount is much less, claimed it was only ever a possibility.

Basically, it was b**ls**t.

There was some spare cash available from being part of EU – our net contribution of £7.1billion per year is effectively the UK’s fee for being part of the Single Market. The benefit from that membership, however, was hard to quantify; but as investment dries up and the economy falters, we may well get a chance to measure how much it did actually mean to us.

Most importantly, national tax revenue of the UK government was £533.4billion in 2015/16 and that net cost represents just 1.3% of that. So if the economy and tax base shrink, or even just grow at a slower rate (i.e. if we had been going to grow at 2.3% and now we grow at 1%, that’s a 1.3% reduction in our expected tax base (crudely)) Such a reduction in growth is now the minimum expected – and any future growth is now from that reduced base. So, however you want to cut it, there are now less resources than there were; and so no extra funding is going to appear as a result of this referendum.

And that is before you look at the impact of losing our sovereign credit ratings.  This basically means that there will be less demand for the debt we issue to pay the shortfall between tax income and government spending (the budget deficit) because we are considered a less economically safe bet. It doesn’t happen straight away because everyone is looking for safe investments at the moment – and government debt is safer than shares – but these ratings are very hard to get, which is why Osborne put the UK through austerity as he knew higher ratings meant we spend more on interest than on ourselves. Maybe it wasn’t worth doing that and we should have done it earlier and had less austerity. Perhaps; but it should have been a decision consciously made at the beginning rather than after being forced on us after 6 years of austerity because of Brexit fallout.

Bottom line, if you voted Leave to get more investment in British services – summarised by the idea that now we’ve left there will be no more queues in hospitals etc as some have claimed – then I’m afraid you have been severely mislead. In fact, I’ll be stronger. If that was the reason you voted Leave, you were conned.

Immigration

This turned out to be a big reason for many people to vote Leave; but there are shades within that representing different people and different reasons. So I’m going to look at those in turn:

Jobs – there were a number of people who believed that the flow of people into the UK to work reduced their wages and made it harder to get a job. There is undoubtedly some truth in that and voting Leave on that basis does make some sense. Unfortunately, it’s only half the picture.

Leaving the EU would allowed the UK to restrict who can come here to work and so take that pressure off wages and make it easier to get a job. True; but leaving the EU causes such a massive economic impact with a reduction in investment and economic activity, that there will then be less jobs around and you are back to square one – still facing competition for jobs and low wages because there are just fewer jobs.

The best way to avoid that negative economic impact – and yet still Leave – is to remain in the Single Market through the European Economic Area. To do that, though, you need to accept freedom of movement and so you can’t restrict immigration.

Therefore, if this was your reason for voting Leave, you are likely to either get your wish but have the same economic situation of low wages and fewer jobs available OR you can have more jobs but accept the freedom of movement and immigration you didn’t actually want in the first place. Either way, it’s not going to work out very well.

Strain on Public Services – there are some who voted Leave because they believed that EU immigrants were putting huge strain on Public services – most notably Schools and Hospitals. In localised areas, there is undoubtedly some truth in that; but nationally, it was never true.

There is general strain on such services; and we virtually all agree that they need more resources (perhaps that was really the biggest message of the Leave vote); but immigrants have been net contributors to those resources and have often been the ones helping to provide those services.

In some areas, there has been strain; and that requires the application of more resources to communities which had seen the greatest change and increase in demand. That was – and is – a UK government issue.

But as was noted in the first section above, Brexit provides less resources, not more; and immigrants were helping to provide those services through financial contributions and personal work. So if you voted Leave on this basis, you are going to get the opposite to what you wanted as there will now be similar strain; but less resources and fewer people helping.

Sending back all those non-whites – I know that sounds emotive but there were a large number of people who voted Leave thinking that this would mean we could and would kick out all past and future immigrants. The massive upswing in post-Brexit abuse on non-white people has been testament to that.

Anyone who voted Leave on that basis will be severely disappointed. Firstly, because the referendum was only ever about the EU and EU immigration. It had nothing to do with more than half the immigrants that come here (the half that are mostly non-white). So nothing is going to change there.

Secondly, even if it was about gaining control over all immigration (non-EU immigration is already controlled by the UK), we were never going to be packing all these people off as they have been beneficial to our economy. Anyone who told you, or implied, that this was the case was either lying or didn’t understand economic realities. If this was your reason for voting Leave, you were also misled.

Sovereignty

One of the other reasons that people gave to Vote Leave was that they wanted to return sovereignty to the UK.

Now to be sovereign is to have the ultimate power and not be subject to anything that you didn’t agree to. Obviously from a personal point of view, that can be quite scary as it would mean that anyone can do anything that they want, which would be anarchy. We all understand that if we are going to live together, we all need limits, otherwise a simple dispute could end in murder and we would have the rule of the strongest.

However, this concept seems to have more traction with states and the idea exists that states – especially nation states – should be sovereign and should not be restricted by anyone else. This is an idea that has quite some appeal – i.e. no one in distant Brussels should have any control over our state. It’s also, I’m afraid, quite ridiculous in the modern world. Let’s look at it with respect to:

  • Trade and diplomacy – We discuss and sign up to all sorts of rules and regulations. Yes, we could unilaterally pull out of any of them and so the UK is still “Sovereign” but to do so causes untold harm and therefore we don’t. So we have sovereign right so long as we don’t use it. Because as soon as we do, people wouldn’t deal with us anymore as they couldn’t trust our promises.
  • Military alliancesAs a full member of NATO we signed away the sovereignty to always decide where to fight as well as the right to command our own troops. In NATO they come under American generals and we would be fighting the day any member state was attacked. But NATO kept the peace in Europe since 1949 so this intrusion on our sovereignty was worth it.
  • Economics – Economics is beyond sovereignty- certainly beyond the nation – as the markets are global and there is no respect for territories. There is just the pure economics of supply and demand; and can only ever be tackled by working together.

So modern states share sovereignty, submitting themselves to limitations for added benefits. And so it was, and is, for states in the EU. It doesn’t undermine sovereignty as each state reserves the right to do what it wants and could break away any time it wants to. But if you do, you lose the benefits – it’s a trade-off. We stay while we have the benefits and we would leave if there were none.  Saying we don’t want there to be a level of rules beyond our state and yet be part of NATO or any of the large trade organizations is to contradict yourself.

Fundamentally, there is no preordained law of nature that says that sovereignty rests with a nation state. The only natural sovereignty one could seriously argue for is that of an individual who chooses, through participating in society, to sacrifice some of their absolute freedom of choice to enjoy the benefits and protection of society. After that, where power is located is an open quesiton; and the fact that the most power is currently held by the Westminster Parliament is accidental. Power can be at any level.

A much more important question than at what level power is exercised, is whether such power is democratically controlled.

Democracy

This was another powerful emotive argument for voting Leave. The idea that we want to control our own destiny; that we should make our own laws and that nothing should be allowed to occur in Britain which the British haven’t agreed to. It’s a powerful argument. Unfortunately, as I’ve discussed before in a previous post, it’s illusory.

Power can be exercised justly and democratically at any level. That isn’t a problem. If power is being exercised without democratic accountability, then that is an issue; but that doesn’t describe the European Union. It could certainly be done better as I discussed in that earlier post; but there is an elected parliament that works with elected governments to decide what affects them all. So how is this not democratic?

The only way this argument makes sense is if you think that the there can be no authority higher than the nation state and that “supranational” authority is inherently undemocratic as Britain can be told to do something that the majority of Britons (but far from all), don’t like.

The logical conclusion of that argument, though, is that any community should not be forced to agree to anything it doesn’t agree with. The problem there is that the argument quickly spirals down to individuals where they can say that they should not have to do anything they disagree with; and then anarchy reigns. So long as there is a democratic discussion and debate on the issues and proposals, it is democratic.

So what is the driving force behind quoting democracy as the reason to vote Leave? It’s basically nationalism. I don’t say that lightly; but it is the only conclusion to come to. There is no logical reason to say you can’t have democratic accountability at a European level unless you believe that the nation state is the only legitimate level for democratic power.

I’m patriotic and proud of Britain – and of my part of Britain; but it’s just part of my identity. To claim it’s the only part that is democratically valid is to pigeon-hole all of us and we are all more complicated and more diverse than that.

But it is a coherent argument for voting Leave and if you did vote Leave on a nationalist basis then you have a clear and focused reason. You would also vote the same way tomorrow regardless of the economic consequences because the nation being sovereign is more important than mere economic advantage. And while I don’t agree with that, I can certainly respect it.

German Dominance

Some people suggested that a good reason to Leave is because the Germans are too dominant and we should be independent of them. This seems bizarre to me because it’s saying that we are so worried about a country’s actions, we want to leave the very organization that puts a break on some of its actions and allows us to directly influence it. Outside the EU, what exactly can we do to reign in that influence? This seems to me to be one of the most self-defeating augments possible.

Improved Economic Position

Most of Brexit economic discussions have actually been focused on damage limitation rather than on setting out a new positive vision. Even when there is supposed to be some advantage, and some say there is, Brexiteers admit there is a lot of pain to go through first.

However, there is arguably a lot of pain to go through after as well and it is highly disputable that there is any economic advantage in Leaving – and a lot of disadvantages (I deal with this in more detail in my earlier post). Basically, economics – especially when one considers what we have to give up – is not a reason on its own to Leave. Listening to most pro-Brexit economists on this issue, they preface most of their comments with a statement about sovereignty or democratic accountability, thus showing the real reason for supporting Leave. And we’re back to nationalism.

Conclusion

Ironically, a week after Leave scored a narrow win over Remain, there are less reasons to vote Leave than there were before the vote. To Recap:

  • More Money on our public services – not going to happen as all the Leave campaigners have now admitted
  • Reduced Immigration – either not going to happen as some Leave campaigners have admitted or, if it did, it would so damage economy that there would be no benefit
  • Sovereignty – ultimately a shared compromise. To have absolute sovereignty means not dealing with others and the economic impact of that would be devastating
  • Democracy – EU could improve in areas but fundamentally there is democratic control
  • German Dominance – a worry that is only made worse by us leaving
  • Economics – never a positive case. Always damage limitation or effectively arguing for a change in policy

If, in the cold light of a potential Brexit, these reasons don’t stack up and have been exposed either through the Leave campaign’s own admissions (extra money for services and immigration) or by their own inconsistent logic (sovereignty, democracy and German Dominance) what does that leave us with?

Nationalism.

The idea that Britain is best, come what may, and should always do what it wants and should never be beholden to anything or anyone. And that this goal, this pure independence, is so valuable that it is worth any cost to achieve.

Nationalism being the only valid reason for voting Brexit is typified by Boris Johnson’s closing statement at the end of “the Great Debate” in the last few days of the campaign:

“At the end of this campaign, I think you’ll agree there is a very clear choice between those on their side who speak of noting but fear…and we, on our side, who offer hope. Between those who have been endlessly rubbishing our country and running it down and those of us who believe in Britain. They say we can’t do it, we say we can. They say we have no choice but to bow down to Brussels, we say they are woefully underestimating this country and what it can do. If we vote leave we can take back control of our borders, huge sums of money, £10bn a year net…and of our whole lawmaking system, the democracy that is the foundation of our prosperity and if we stand up for democracy we will be speaking up for hundreds of millions around Europe who agree with us but have no voice. If we Vote Leave and Take Back Control I believe this Thursday can be our country’s independence day”

No promises, details or facts. Boris just wrapped himself in the flag and said Britain is great and so we can do this if we want to. Emotive, passionate and devoid of any substance. Perhaps that works in a debate; but it’s a poor way to run a country and to decide our future.

Given the lies that infected the campaign, the nationalism that dominated it, and the economic imperatives that drive a different way, there is only one thing anyone can say about this result – it wasn’t decisive, just divisive.

Winning a small majority by outright lying about key issues and promising the earth, the Leave campaign forfeited any moral authority it had. And for something as momentous as this, you really need to carry the whole nation with you. This did not.

The result has not produced a conclusion to this matter. All it seems to have done is divided the country and wake the passion, which has been complacent, on the Remain side. With demographics on the side of Remain, combined with a growing feeling of being conned by so many who did vote Leave, this issue is far from settled.

I expect it to dominate politics for the foreseeable future.