The economic impact of leaving the EU
The economic impact of leaving the EU
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Edit: after a recount, first, like Leave.
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TSE still sore about the result?
(This is a reference to Farage's concession early on the night, not a suggestion LostPassword is the frog-faced Fascist.)
I note todays darling Peter Magyar has pointed the way to the future. Both him and Zelensky have suggested Brejoin as important to the future of European defence.
I'm looking forward in particular to part 3, and what methodology is adopted to attempt to address that.
I suspect the answer is ultimately that it's impossible to tell what the aggregate economic impact of Brexit has been, but the methodology of the attempt criticised in the header does seem to be particularly poor.
Has anyone come across anecdotal stories of UK businesses benefiting from post-Brexit trade deals?
As exciting as an AV thread.
Greens overtake Labour
RefUK 24% (nc),
CON 19% (nc),
GRN 18% (+2).
LAB 17% (+1),
LDEM 13% (nc),
https://x.com/SamCoatesSky/status/2043917459401453842
And where the balance of benefits is, is an empirical question which this study attempts to answer, but I believe its answer is hugely overstated, if not completely wrong.
Anecdotes, assertions and cherry-picked statistics are, I'm afraid, no match for detailed analysis.
As Keynes said, in another context, "the general public, though welcome at our debates, can only be spectators".
Wait a few years and when that figure hits 10% from 8% it will be on a side of the return bus.
What never gets pointed out by those bemoaning the effect of Brexit is that those same moaners were the people who tied us ever more closely into a situation where leaving would harm us. Deliberately, daring us to unravel it. With no democratic process involved in that ever-closer enmeshing.
If Brexit had a cost - then let's not blame the voters. Rather, let's blame those who made it an inevitable consequence, once democracy entered the debate.
Not clear yet what the implications are for the California governor primary, as he will still be on the ballot despite withdrawing, but it seems likely that it will consolidate Democratic support around one of the other two leading candidates and is probably therefore bad news for the Republicans hoping to take the top two spots.
Gonzales, in Texas (Republican) also to quit the House for much the same reason.
Honestly, what is it with US politicians?
https://www.reaction.life/p/britain-looks-like-brexit
But it’s impossible to say there were no impacts on UK growth. The biggest impact was on small businesses exporting who were less able to deal with the new red tape . HMRC note a drop in businesses exporting to the EU of approx 20,000. Some of those businesses would have likely grown in the future .
Of course there was a muddying of the waters with Covid, the Ukraine war which makes analysis all the more difficult.
Before Brexit the EU was an easy scapegoat for the UKs problems and now we see the reverse where Brexit is in the firing line.
Some of it warranted and some not .
Which in theory it is, via an app, but only for Portugal and Sweden and it sounds as though it's very hit and miss even there.
Good to know it's not just the British who are totally incompetent when it comes to managing mid-level technology systems.
* Or jetsam depending of how we left the EU.
Hooray, said Kemi Badenoch.
Your list of bullets under Flaw 1 is however, er... flawed:
1. a once-in-a-century pandemic,
2. Russia’s invasion of Ukraine,
3. the big increase in the tax-and-spend ratio,
4. the decline of the UK’s two highest productivity industries (financial services and oil and gas),
5. the Liz Truss mini-budget,
6. mistakes and triumphs of macro- and micro-economic policy, etc. etc.,
1. and 2. affected all western economies, so are not relevant to Britain's economic performance relative to Germany, France etc. (Brexit almost certainly encouraged 2. though, Putin seeing the West as divided.)
3. is a consequence of 1 and 2 and similarly affected Germany (UK tax take 2016 / 2026 = 33.7% / 37.0%; Germany 37.6% / 40.5%; France 45.3% / 45.5%)
4. Hard to be sure that the decline of financial services wasn't impacted by Brexit.
5. Without Brexit no Truss PM
6. Affects other economies too.
Ultimately, the butterfly effect probably applies here - we cannot know how things would have proceeded without Brexit.
The Eurosceptics put in a lot of agitprop work, over several decades, to turn British attitudes against Europe. I'm not convinced that European Unionists in Britain are capable of turning back that tide.
A concerted effort is underway by a bipartisan group of women Reps, to force especially sexual allegations out into the open. It was recently discovered that $17m has been paid out of public funds in settlements to sexual accusers, and the men in Congress voted to keep the details secret.
The California governor primary was of course the whole reason for the Swalwell allegations coming out this weekend, when it appears that his being a scumbag with women has been well-known among the Washington and Sacramento political and media classes for a decade or more. One has to admire the ability of the Democratic party to so ruthlessly cast aside one of their own when he’s no longer useful to them, and risked handing one of the most coveted positions in US politics to the Republicans. There’s now a better chance of both parties advancing out of the “jungle” primary in June, instead of the two Republicans.
More fool Merkel for trusting the EU's energy supplies with Putin's Russia. That did indeed impact the relative EU vs UK economic performnce, so your cascade above, er, falls down.
On Truss, that had bugger all to do with the EU. It had all to do with the Conservative Party members losing their minds.
https://x.com/bswud/status/2043942711842029853
Unless they've learned from this experience?
PB
More FBPE PB 😀
In the last couple of years the UK has continued to outgrow Germany.
A few more years of that, and it is going to be very hard for anyone with an ounce of credibility to claim harm.
Or perhaps more accurately, why did the Conservative Party lose its more mindful members?
FWIW, I have sympathy with some of Fishing's arguements - the US dominated comparator, for example, but the wider shocks, while a complicator, did apply to all, albeit with potentially different severity. The kind of thing that completely buggers up an interrupted time series (e.g. Covid has ruined many such analyses for a while). I haven't read the original study and I might be less sympathetic to Fishing's point of view if/when I do so.
ETA: I don't think we'd have been completely Trussed without Brexit. Cameron would have gone on much longer, potentially being replaced by a Lab PM in the end.
My summation, both before and after Brexit, was that there was simply far too much noise to allow a clear conclusion that Brexit had been bad or good for us. As you point out in your first flaw the period of time since Brexit has been exceptionally noisy with a whole series of events that will have had larger effects on our economy than Brexit did. The political responses to these events, such as the pandemic or the increase in gas prices post the invasion of Ukraine, varied widely from country to country once again exacerbating any differences. Anyone who thinks that they can confidently identify a "Brexit" factor in that mess has an agenda.
An argument can be made that the UK did comparatively better from its EU membership than the EU itself or more to the point the Eurozone countries .
That’s proven by the data !
https://dieterhelm.co.uk/energy-climate/the-price-of-energy-and-the-system-costs-of-renewables/
That was despite her erratic behaviour, political fundamentalism and bizarre public performances.
If he had kicked her out in 2009 none of that would have happened.
I think it's bold to assume she would not have been further promoted had his government not continued.
One thing that you should pair empirical analysis with is some theory. By what mechanism had Brexit induced faster growth in the UK? What effects have counteracted the significant barriers to trade out businesses have had to endure?
We'll never know, of course.
Their agenda is much more important to them and they don't need to worry about scrutiny because the liberal elites in the media will repeat anything they see that will further the agenda.
A governor or Senator untainted by the Biden government would have had a better chance.
Although, it is worth remembering had any of the Republican Party, the Supreme Court or the American judiciary done their duty rather than what would be popular with the nuttier elements of American society it wouldn't have mattered.
Together with the US President entering the debate on the side of Remain.
Biden let us not forget actually beat Trump in 2020, he knew Harris would hand the election to Trump on a plate and he was right, hence his reluctance to let her run
I'm not sure the electorate would have bought it though. They are an orney bunch. As Trump is now discovering in turn. At least Biden had an external excuse for inflation. Trump's is a self-imposed economic clusterfuck. Perhaps his only out is to fire his Administration and say "They were all idiots!".
Although, the replacements will likely be too.
And the main idiot will still be in the White House.
Before 2016, one of the dynamics was Sensible Government Types saying "leaving the EU would harm our GDP". It didn't work that well as an argument- the lady on Question Time(?) who said something about her GDP having been rubbish for years nailed it.
It's very hard to rationally argue someone out of a sense that life isn't going well for them, and that's why some people were happy to roll the dice on Brexit, and now on Farage and Polanski. I'm unconvinced that Brexit backers telling the public that British GDP is nothing to do with Brexit will make much of a difference.
Whether it's fair or not, the public hive mind currently thinks that Brexit isn't going well and was probably a mistake. The polling is here;
https://www.whatukthinks.org/eu/questions/in-highsight-do-you-think-britain-was-right-or-wrong-to-vote-to-leave-the-eu/
Either that changes (how?) or the question will continue to stink out the political conversation in this country.
If billionaires back Zelenaky over Putin all to the good and most billionaires in the US voted for Harris who opposed the Iran conflict not Trump
The alleged economic benefits of Brexit suffer and suffered from exactly the same flaws as this study. They start with a conclusion or some wishful thinking and then they "prove" that benefit has occurred or will occur. It is gibberish.
Brexit gave us the opportunity to change our economic model somewhat. We could have significantly reduced regulation, we could have changed our tax system to favour investment in ways not permitted within the Single Market, we could have provided greater subsidies or incentives that would have attracted more foreign investment. None of these are no brainers, of course, there would have been a price to pay in terms of trade deals and access to foreign markets. In very recent times we have drawn back to further integration of regulation with the Single Market and looked to reverse the modest changes we had made.
The Treasury has fiercely resisted any such changes because they were anxious about the trade implications. Whether they were right or wrong about that is something else we will never know the answer to. But that policy agenda has further muted the Brexit effect for good or ill. We had opportunities but we did not take them and now seem to have decided that they are not worth taking.
every swing state and the popular
vote to Trump. The Australian and Canadian governments were elected last year, the Spanish government was re elected, the Indian government won most seats in that time period
From Fishing's data its clear that the UK has grown 300% faster than the EU if Germany is used as the sole comparator.
Two discordant thoughts on all this - events like the pandemic and the Russian invasion of Ukraine would likely have happened were we still in the EU. They were both (and are) economically disruptive and would have been so whatever our EU membership status.
Second, we couldn't go on as we were with our rebate-obsessed, half-hearted, mean spirited membership. The EU had long moved on from being simply a free trading bloc or "Common Market" with which we were largely content. The social, cultural and economic impacts of Freedom of Movement in particular led to significant resentment.
There were indeed only two coherent positions - we should either have stayed out completely (though wishing the overall project well and establishing a solid working relationship) or joined in enthusiastically embracing Schengen, the Euro and accepting the push to full economic and political Union. We chose to adopt neither and wasted two generations arguing about it.
Biden should have done what he said he would do back in 2020, which was to announce early that he would be a one-term president and allow for a regular primary season. It’s unlikely Harris would have won that.
The problem was those around Biden enjoyed the power too much, as the old man mostly let them get on with things by themselves. They all conspired to have him run again, starting with his wife, until the debate performance vs Trump pushed the issue that he was too old right to the front of the news for a week.
Personally, my choice to support leaving the EU was driven by questions of democracy and sovereignty - I always thought the economic impact was likely to be slightly negative in the short to medium term, and am pleasantly surprised by how small it seems to have been. For instance I thought the economy would fall into recession for a year or two after we voted to leave, but that did not happen. Conceivably it would have done when we left the single market, but the magnitude of the COVID impact at the time was so enormous that we will never know.
As to the list of bullets, the point is not that France and Germany or others were unaffected by those factors, but that the impacts were differential. For instance, the UK has been affected far more by the two big energy shocks than France. Conversely the slow-motion financial crisis in France as it cannot get its budget deficit under control has played out very differently in the UK, as we are not in the single currency. To be worthy of the name, the study should have made an effort to disentangle them and quantify those differences, rather than simply asserting unsupported that the UK's alleged underperformance was due to leaving the EU. Of course that would have lengthened it from 81 pages to several volumes, but that's the price of rigour in these matters.
More likely, the effects are fairly marginal either way. There are too many non-statutory constraints for it to make all that much difference - EU remains a big and nearest market and so fitting in with their regulations to sell there becomes largely de facto even if not de jure.
Harris was a rubbish candidate.
Harris would have done better if she had been incumbent President and/or become candidate through a primary process.
Given that it only needed a 1% swing for Harris to win ...
It's taken me a while to get to that point - I've very much been on a journey and my general thinking has been that the price that would be demanded as a condition to lock the UK back into the EU probably makes it unpalatable to the majority - but I think this is by now by far our best option in an uncertain world.
I didn't support Brexit in the referendum (though I did appreciate some of the arguments on the leave side), but I did believe that the referendum result should be honoured and I disliked the political game-playing that followed. But I think the world has changed so much since 2016 and our politicians have all failed to grasp any potential opportunities that may have arisen (the only real benefit would have been to go bold and undercut in many areas, which is of itself a high risk strategy), to the point where it looks like we are now going to remain peripherally aligned but with no real influence on direction - the worst of all worlds that most of us wanted to avoid.
At the same time we are increasingly learning that we cannot expect our interests to align with the US (even if Trump is gone in 2028 there is little doubt that his politics will still pervade at the top levels of leadership for some time, even if the GOP lose power at the federal level in the immediate term).
Europe now needs to seriously start thinking about its security (economic, energy, border etc) and its place in the world. There is a huge opportunity for it to present itself as a stable bulwark and a safe place to do business. There is a lot that the UK can bring to the table in that discussion - I am not saying we hold "all the cards" but we do bring with us clear strengths in finance, skills, language, defence and security etc. The EU needs to reform, but we should play a role and part in that, not as an observer.
And finally, from a pure electoral standpoint, a rejoin referendum is surely the rabbit out of the hat that Labour need? It's the one weapon in their arsenal that could change the game, the one thing that enables them to present a clear differentiator and choice at the next GE and bring back wavering voters. It's radical, it will upset some people, but given where they sit in the polls surely it makes increasing sense.
I don't see any Westminster government wanting to assume responsibility for anything that is suboptimal in Britain.
I wonder if these 'academics' will receive the mockery that Matt Goodwin has.
Its almost comical that their 'evidence' that the UK would have done better in the EU is based on comparing the UK with a country not in the EU.
I’m sure that, with the UK still in the EU, everything except nuclear weapons would be pushed into a version of the “EU army” wished-about for decades. An EU army which would have done an awful lot of talking among the many big brass hats, but with little action resulting.
For their many faults at least Labour are pro nuclear power
The NBER 8% claim is perhaps at the higher end of the estimates of Brexit’s impact on the UK economy but the consensus seems to be that (sadly) the negative impact is real & sustained and the promised sunlit uplands of Brexit have not materialised.
It was as though the Leavers in the party, having won the electoral argument, decided to metaphorically disembowel themselves and leave the field to May and her campaign manager, Gavin Williamson, who seemed like some kind of political genius such was the depth of the rabbit hole into which the party had descended.
Who did the Leavers put up - Andrea Leadsom, once Gove and Johnson had shot themselves in the foot and stabbed each other in the back at the same time?
Had Johnson or Gove taken over after Cameron with a clearly articulated vision of what leaving the EU was about, it might have been easier to manage a Commons where there was no majority to leave the EU or force an election to win a clear mandate to leave - would a Johnson or Gove led Party have done better than May did in an alternative 2017 election?
Hard to see how they wouldn't.
Why wouldn't or couldn't the Conservative Leavers take the victory they had obtained (which had been obtained by millions of Conservative voters supporting Leave against the Prime Minister)?
was a woke coastal elitist.
Sunak was leading a government in power for 14 years not candidate of an administration just 4 years in office
Australia and Canada also suffer as comparators for similar resource export reasons.
Perhaps there would be something you could do with a more detailed analysis, that looked at the performance of particular economic sectors (such as the pharmaceutical industry) or something like SME cross-border trade growth, foreign direct investment, or business investment.
As such, it is perhaps the most politically influential academic paper since the Ferguson studies on the impact of not locking down - which, I would argue, were similarly flawed, but also permeated the debate because they told people something they believed and really wanted to hear from an expert.