Despite the narrow victory for the Leave campaign in the referendum, the UK remains a member of the European Union and will do so for some years to come. In this country, Parliament and not the people is sovereign, and this means that a decision to leave requires a Parliamentary vote. Assuming this reluctantly confirms the result of the referendum, the UK will need to renegotiate the hundreds of treaties that cover trade with the EU, as well as those treaties between the EU and other countries in which the UK was a participant. The procedure for doing this under the Treaty of Lisbon is for the Government to notify the EU of a desire to invoke Article 50, which provides a maximum of two years for the completion of negotiations. This is unlikely to be sufficient, and so the renegotiation period may be extended on ad hoc basis.
In the meantime, here are five observations on the referendum vote:
1. The ‘scare stories’ produced by the Remain camp during the campaign have turned out to be accurate predictions. The announcement of the result was followed by an 8% fall in the FT250 measure of share prices, a downgrading of the UK’s credit rating, an 8% fall in the value of Sterling, announcements by various firms in the City of London that they were planning to move staff to rest of EU, a renewed demand by the Scottish Government for another referendum on independence, and warnings that withdrawal from the EU would undermine the peace agreements in Northern Ireland.
2. Immigration from the rest of the EU will rise. Withdrawal from the EU has been sold to the public as a means of reducing immigration from other EU countries. But during the period of negotiation, freedom of movement will still apply. This will be an incentive for people from the rest of the EU who wish at some point to move to the UK to bring forward their plans in order to beat the deadline. A similar pattern was seen when the British government announced plans to restrict Commonwealth immigration in the 1960s.
3. There will be greater pressure on the NHS and social care services. About a million UK citizens live in the rest of the EU. Most are elderly people who have retired to warmer climes and who are eligible under EU rules for access to local healthcare services and social security. Withdrawal will probably mean the loss of these rights, which will result in a return of some elderly expatriates and a reduction in the number of elderly people who will choose to retire abroad in the future. In consequence, the number of elderly people in the UK will increase even more than previously estimated, Elderly people are of course the most intensive users of the NHS and social care services.
4. Whether the UK is in the EU or out, the fundamental weakness of the country’s economy will continue. Weak corporate management (sometimes more concerned with looting assets than developing long-term growth), a financial sector which makes more money from facilitating takeovers by foreign companies than investing in our own industry, and the basic lack of skills in the workforce all reflect British domestic policy and have nothing to do with the EU. You get a Polish plumber not because he undercuts British workers, but because we don’t train enough of our own citizens to be plumbers.
5. Russia will be strengthened. Russian policy since the time of Peter the Great has been to subvert, weaken and divide its neighbours to the West. Under Putin, this has involved the invasion of Ukraine, building alliances with authoritarian nationalist rulers in the EU, and funding authoritarian nationalist political parties such as the Front National in France. A British exit from the EU will encourage other authoritarian nationalist movements in the EU and weaken individual countries’ commitment to NATO and other forms of collective action.
All of which makes it essential that the British people reconsider their vote. A good time would be at the end of negotiation period in two (or more) years time, when the full consequences of leaving the EU would be apparent. After all, this is what happens when workers go on strike: there is a ballot to cease work followed by a second ballot to decide whether or not to accept the agreed terms.
In the meantime, here are five observations on the referendum vote:
1. The ‘scare stories’ produced by the Remain camp during the campaign have turned out to be accurate predictions. The announcement of the result was followed by an 8% fall in the FT250 measure of share prices, a downgrading of the UK’s credit rating, an 8% fall in the value of Sterling, announcements by various firms in the City of London that they were planning to move staff to rest of EU, a renewed demand by the Scottish Government for another referendum on independence, and warnings that withdrawal from the EU would undermine the peace agreements in Northern Ireland.
2. Immigration from the rest of the EU will rise. Withdrawal from the EU has been sold to the public as a means of reducing immigration from other EU countries. But during the period of negotiation, freedom of movement will still apply. This will be an incentive for people from the rest of the EU who wish at some point to move to the UK to bring forward their plans in order to beat the deadline. A similar pattern was seen when the British government announced plans to restrict Commonwealth immigration in the 1960s.
3. There will be greater pressure on the NHS and social care services. About a million UK citizens live in the rest of the EU. Most are elderly people who have retired to warmer climes and who are eligible under EU rules for access to local healthcare services and social security. Withdrawal will probably mean the loss of these rights, which will result in a return of some elderly expatriates and a reduction in the number of elderly people who will choose to retire abroad in the future. In consequence, the number of elderly people in the UK will increase even more than previously estimated, Elderly people are of course the most intensive users of the NHS and social care services.
4. Whether the UK is in the EU or out, the fundamental weakness of the country’s economy will continue. Weak corporate management (sometimes more concerned with looting assets than developing long-term growth), a financial sector which makes more money from facilitating takeovers by foreign companies than investing in our own industry, and the basic lack of skills in the workforce all reflect British domestic policy and have nothing to do with the EU. You get a Polish plumber not because he undercuts British workers, but because we don’t train enough of our own citizens to be plumbers.
5. Russia will be strengthened. Russian policy since the time of Peter the Great has been to subvert, weaken and divide its neighbours to the West. Under Putin, this has involved the invasion of Ukraine, building alliances with authoritarian nationalist rulers in the EU, and funding authoritarian nationalist political parties such as the Front National in France. A British exit from the EU will encourage other authoritarian nationalist movements in the EU and weaken individual countries’ commitment to NATO and other forms of collective action.
All of which makes it essential that the British people reconsider their vote. A good time would be at the end of negotiation period in two (or more) years time, when the full consequences of leaving the EU would be apparent. After all, this is what happens when workers go on strike: there is a ballot to cease work followed by a second ballot to decide whether or not to accept the agreed terms.
