Brexit Revisited
Virtually everyone beyond Britain fell asleep on the night of June 23 in the belief that the result of a referendum on EU Membership in the country was already decided. In fact, in Nick Clegg’s (former) seat of Sheffield Hallam, he reported in a BBC interview that people had voted for Brexit for the fun of it; that Brexit wouldn’t happen. However, then came the results; unlike other elections, there was no exit poll or projection. Instead, those in the Leave and Remain campaigns had to painfully watch as each of the voting booths reported their results.
The key shock came when Sunderland voted in favour of leaving the European Union. It was an unexpected result from a key region; if it fell to the Leave Campaign, a Remain victory would very much be on knife’s edge. The Sterling fell almost 3% with that result alone. Panic was beginning to build in. Soon after, the Midlands clearly appeared to be Leave territory; not even a strong lead of 24% for Labour in Scotland could save the Remain camp. England and Wales voted firmly to leave the European Union, and Leave by far bested Remain with a 1.4 million vote lead.
Panic set in from the outset. The Pound plunged 10% and the Euro, 6%. Shares on international financial markets plunged; the Dow Jones Industrial Average plummeted 600 points, Asian shares took a drubbing, and British and continental European stocks saw their worst day since the worst of the European Debt Crisis of 2011. The exact repercussions of Britain voting to leave the EU were completely unknown.
The political ramifications were clear; the vote led to an upsurge in the voices of Euroscepticism in Europe, where elections were scheduled for the next year. Marine Le Pen congratulated the British on leaving the European Union, as did Geert Wilders (two of the most Eurosceptic leaders whose voters would head to the polls in 2017). In Britain, David Cameron resigned (even after saying he wouldn’t) and would be succeeded by his Home Secretary, Theresa May. Within the European Parliament, there was a general sense of anger and horror. Jean Claude Juncker furiously retorted to Nigel Farage’s victory speech in Brussels with allegations that the Leave Campaign had won due to lies.
The exact sources of victory for Leave (against all odds) aren’t hard to spot. On the right, the Conservatives had always been divided, with the further right of the party advocating Brexit for long. Indeed, Guy Verhofstadt (a key proponent of European Federalism) claimed that the whole Brexit vote was a result of infighting within a divided Conservative Party. UKIP, although far from a force in the British Parliament, had won 12% of the vote in the 2015 election (the third party by popular vote). On the Left, Euroscepticism was also present; from data taken from the 2017 UK General Election, there were clearly many UKIP voters who came from the Labour Party.
How did the expectations end up so wrong? First, there’s the unfortunate Remain Campaign platform against the populist Leave Campaign platform. For ‘Remain’, there was largely fear-mongering of the economic ramifications of leaving the EU (justified or not, that is up for the voter to decide). However, in an era where detailed numbers and International Economics remains too much for an ordinary voter to digest; it was clear ‘Remain’ fell short. Furthermore, the extent to which ‘Remain’ was fear-mongering made them seem as though they had no argument (when they clearly had; a political movement wouldn’t be a movement if it were baseless). It was so badly run that Soraya Bouazzaoui, herself a Remain voter who accused David Cameron of ‘waffling’ in a Brexit town-hall like discussion on Sky News, said that everything she saw made voting to remain in the EU look worse.
By comparison, ‘Leave’ ran a campaign filled with its own, more populist fear-mongering; best exemplified by the image of Nigel Farage and an army of refugees following him. This was the critique of the Free Movement of People. Another successful slogan was ‘£350 million for the NHS’; this wouldn’t have made much of a difference in the Blair and Brown years when the NHS was generously funded. Cuts as part of the austerity programme, however, added to the strain to public services; the idea that such cuts could be relieved by ending financial concessions to the EU was a myth too good for the British public to pass off.
Indeed, the idea of making the EU a scapegoat for many of the economic and social difficulties Britain faces was quite easy. The immigration question was an easy talking point of ‘Leave’; with the free movement of people, Britain was signing a warrant to be flooded with immigrants with no ‘control’ over borders. Although there is plenty of evidence to contradict that (Britain did have some control over borders as part of the Schengen Agreement); it seemed to suit the interest of an angry public.
More importantly, however, was the fact that a clear distance between ‘Eurocrats’ and political classes, and the British people. Consider the talking points from ‘Brexit: The Movie’; the European MEPs received generous pay-outs and massive allowances for their home and children’s education. For an average Joe, unable to make ends meet, the prospect of seeing their money enter the pockets of some already well-off ne’er-to-wells was too much. The vast difference in the prosperity of the upper classes, particularly those in government, and those ordinary British people, would have made the idea of staying in the EU fundamentally unfair to them.
The exact extent to which the claims bandied about by either side were accurate is debatable. The ‘Remain’ campaign’s claims that the British household will be £4,300 worse off by 2030 and the economy, 6% smaller relied on a number of assumptions, when predicting the shape and course of the world economy ten years later is in itself difficult and likely to yield incorrect results. The Remain Campaign also claimed that leaving the EU would cost 3 million jobs; that wouldn’t account for potential future growth after Article 50 of the Lisbon Treaty were put in place.
As for the Leave Campaign’s £350 million for the National Health Service; that would be to assume each and every penny that goes to the EU daily would be spent on the Health Service (which would make such a claim more valid for a General Election assuming not every Conservative could promise £350 million, on the nail, for the NHS). In fact, the claim was ridiculed just months later; after September 2016, it was clear it wouldn’t materialise for some time. Further, it didn’t account for the fact that the EU could demand money and investments back; such talk of a ‘Brexit Bill’ was laughed at and made part of the list of the 10 Myths of Brexit on the ‘Better off Out’ page. That isn’t even to mention their claims that Britain had no control over its borders and that Britain could emulate Norway and Switzerland (claims that would need infinite assumptions; including that Britain could actually get a free-trade deal with other nations and that Britain would pursue a free-market economic policy that-if a Labour government were formed-would be deemed impossible).
Just how will Brexit shape up in the future? With the benefit of hindsight, we can see that the picture isn’t as rosy as it was in late 2016 (when it wasn’t rosy anyway). It was clear that France and the Netherlands rejected extreme Euroscepticism, and the idea of Britain becoming a free-market economy attractive to tremendous foreign investments that would keep the City of London alive and dynamic was not going to happen as long as Labour moved further to the Left.
The effects of Brexit were clear. Domestically, the vote further divided the population and left many angry at the Conservative government. The result in Scotland then reinvigorated the Independence debate; Nicola Sturgeon, the Scottish First Minister, claimed that the Scottish people chose the EU and had to be considered. With hindsight, we can see this did nothing to win the SNP votes (they lost a third of their seats in the 2017 General Election). Over in Europe, politicians were horrified by it and some wanted to give Britain a punitive deal so as to keep other nations from leaving the EU. Others saw it as an advantage to create a more federal Europe.
With hindsight, we can see that the ‘Hard Brexit’ vision that seemed more likely than not to materialise would be undermined on the ballot with the 2017 General Election yielding a once ascendant Conservative Party, a devastating blow. However, it still left many questions in the air. Would the EU be united, and Brexit bring the 27 nations together? Or would the initial perceived unison of countries because of Brexit lead to a false air of optimism in the EU that would only yield more populism for the future? In the short-term, what would it mean for someone else across the Atlantic who had to pull off a Brexit times five?