Thursday, 11 August 2016

Imagine there's no countries - how do we get there from here?

There's been some astonishingly good analysis on the Brexit decision in the last couple of days, here are some of my reflections.

I'm struck by the fact, as the IFS outlines, that the government wants to take a lot of time, effort and money to shoot ourselves in the foot on the back of one vote about #Brexit, a non binding one at that. But the most startling thing to me is that the choice that seems to be surfacing, albeit probably impossible, is being part of the single market but not having free movement of people.

As Daniel Knowles points out spectacularly well in The Times, it seems Brexiteers don't understand international trade, only it's discontents. I've noticed this before, namely that even David Cameron and his "global race" don't seem to understand that all economies gain from trade, and that includes people moving across boundaries.

People don't seem to like immigration across the world, and there's probably some political leadership to be done there- as per when Free Trade was advocated in the 18th century by the likes of Adam Smith. Sometimes it feels as if without ideology as we are, more or less; we don't seem able get across ideas in the modern world, but it's in my view that the economic world has far outstripped the political world with globalisation. It is better to have the free movement of people, the question is how we get there from here?

Watching Out and Proud, the Sky documentary with Faisal Islam last night I was struck by how many people genuinely had based their vote on the ahem, misspeaking of the Leave campaign - people referred to the £350m for the NHS (discredited) and apparently the fact oil, gas and food will become cheaper after Brexit.

I'm not sure many people think we are actually a great economy in the world, because they look around their local area and see poverty and lack of investment. The Pareto Principle leads people to invest where money can "do the most good" which seems to inevitably mean loads of investment for the South East of England and less/not much elsewhere. The EU seeked to balance that by investing in our deprived areas, areas that will lose out as a result of Brexit.

It seems there are many reasons for voting out and that they often stem from a mixture of misconceptions ("We'll be better off out as we aren't that well off as a country") prejudice ("immigrants taking our jobs") and ignorance about how free trade works - ignorance that extends to the people charged with Brexit.

I can only hope eventually our very pragmatic PM, Theresa May, comes to appreciate that Brexit could cost us very badly, that is if she doesn't already, and potentially provides the very leadership we spoke of. It's a small hope, as our previous PM, despite being on the surface more outward looking, didn't really get it either.

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