ER

To brexit or not to brexit?

Dear Reader,

After a weekend of code reading – three other websites got hacked and needed cleaning – I almost had it with the internet. When I got back to the fun part of life, I noticed a dozen SPAM comments on diablog. And unfortunately one of Philippa’s

phillipa-real

got caught in there as a false positive. Sorry for that, Philippa, your comment is up now here.

Prior to that, Glynsky and I were debating again. We just love it. Not that it changes much, or anything at all. It is fun, an intellectual exercise. This time the topics were:

  1. Great cars, we agreed mostly.
  2. The potential Brexit, we did not agree at all.

Now, the POTUS, aka Barak Obama, already collected negative points, when he “meddled with British affairs”. His advice was, do not leave the EU. More about the reasons later.

I do not really care that much, whether you will leave the EU, or not. But Glynsky asked for my opinion. And maybe I can add some food for thought from the outside.

Update: Before we get serious, here is an amusing piece (Monty Python says hi):

Let me start with the positive implications of a Brexit:

None

The only positive aspect Glynsky maintained after our debate was, that he likes being independent. Fine. But that is more for entertainment. In itself it is not worth much. Being against mainstream, the whole world develops towards more cooperation not less, can be interesting. Yet, being North Korea isn’t a lot of fun, I was told. And no, you will not be allowed to play Switzerland or Norway. Which both are paying substantial amounts towards the EU, and they make sure to play nicely.

Whereas the monies you are sending to the EU are peanuts. Since Thatcher you get a 66% discount on your net payments. Yet you got most EU headquarters of foreign companies from America and Asia. I’d say that is worth a lot more in tax revenues, employment, general business, and not to forget influence. And you have not played nicely in recent years.

Glynsky’s next idea was, the UK could become the tax haven in Europe. To which I replied: that you are already. Granted, the Dutch have the Antilles, the French have Curacao, the Italians have San Merino. But nobody helps tax cheaters and criminals more than the English banks. Nothing to gain there. Most dubious money from almost all crooks in the world finds it way to London already.

And what about additional international business? From where? Do you believe, there is anyone out there, who has held back? As in: Oh, no, they are part of the EU, we will not deal with them. Seriously? English as a foreign language made you the number one destination for trading. You surpassed France hundreds of years ago. Before any Chinese, Indian, or whatever tries France, Germany, Italy, or any other market, they come to you. You actually benefit handsomely from being perceived as the gate to Europe. Even Americans start export to Europe in the UK.

Now let us get to the almost certain downsides of a Brexit.

Nobody can put a number on it, but you will lose business. And it will be substantial.

First all the above mentioned EU headquarters will leave the UK quickly. You can kiss good-bye to tens of thousands of high paying jobs. Those are very flexible and their reason of being in the UK will be lost.

Next, most of the manufacturing/assembly done in the UK will leave. For example, currently the UK is a net exporter of TVs. Not because you have an English TV manufacturer. But the Asians assemble there for the EU. Those businesses and jobs you will lose. The same goes for cars. Why would Tata make Land Rovers in the UK? Why should BMW make Minis there? For all foreign investors you used to represent access to some 350 million consumers. That will be down to a mere 60+ millions. Almost 80% of your commercial importance will be gone.

What about your financial industry? Immediately after the Brexit the EU states will play hardball. If you want to learn what that feels like, ask Swiss bankers. Or ask around in Panama. Only as a member you could prevent a tax on financial transactions. Only your membership saved you from losing your all important ‘financial industry’. Once you are out, you and you banks will be free game. The money from citizens of the EU will leave immediately. Your so-called City will have tons of office space available soon. Have you wondered, what the Pound Sterling will be worth after that drain?

And for the ones hoping to get new trade deals negotiated quickly, I quote our POTUS:

“The UK will be at the end of the queue”.

You are way more dependent on imports, than anyone is on exporting to the then reduced UK. You actually need trading partners. While those are focusing upon Brazil, Russia, India, China, Iran, etc. Do the math. 60 Million Brits versus billions of consumers in the other markets.

You made a similar mistake in 1887. Overestimating your power you forced German companies to label their products with “Made in Germany“. The result is well known, you helped create one of the most valuable brands in the world – for Germany! And lost tons of business in the process.

While we are at history, England invaded all but seven counties in the world at one point or another. Do you really think, they all forgot? Do you really think, those will be eager to deal with a reduced, less wealthy, less powerful, less important UK? Right now, nobody starts a trade war with the UK, because you are part of the EU. After a Brexit some might give it a go. Russia comes to mind. Farewell British Petroleum, hello TotalFina and/or Royal Dutch Shell. Mr. Putin might get some of the Russian money out of London and closer to home.

Finally, I owe you the reasons why the USA wants you to stay in the EU.

The first reason is, you were and are up until now are our #1 partner within the EU. Whenever Europeans wanted to do something we didn’t like, it was your job to veto it. Whenever we wanted something from the EU, you organized that. Whether we want you to spy on people, or when we wanted Europeans to join us in a war, or at least pay the costs. Since WW II you have – to call it politely – followed our lead increasingly well. We would not like to lose that kind of influence.

Secondly, there are only two things our national security experts really fear:

  1. A fleet big enough to invade. We will do everything to prevent that from being built by anyone.
  2. An alliance of Russian manpower with German money and knowledge. Such an alliance could endanger US hegemony. The result of the Nazi-Soviet-Pact was disastrous enough, wasn’t it?

As long as the UK plays a role within the EU and represents our interests like in the past, such an alliance is less likely. We would like it to stay that way. Not only for us. For another 70+ years of peace in Europe as well.

Your turn.

Engine Room

15 thoughts on “To brexit or not to brexit?

  1. Thanks for that ER, I hope the necessary parts reached the fenced people.
    I find it irritating that I must vote because this should be a no brainer even without the facts.
    Lets make the world easier to understand, if the US wants to do the thinking for everyone then let them, so far, be known my knowledge is limited, they have done a good job and I trust there decisions.
    Peace and all that jazz, we are now going past politics and into the unknown universe(big boy stuff) – that is of real interest. Set the egos aside and keep it in perspective we are but a teeny bleep in the universe.

    Casper X

    • I am skilled in the art of kicking cheeky bums, Smiles xXx do you dare anger for a wrath of Casper?

  2. Let the record show that last time upon seeing me – Smiles only let out a prolonged bleeeeeeeeeeeeeeeeeeeep haha ;-)

    Casper

  3. I could hardly raise the enthusiasm to reply to this load of drivel! The video was full of inaccuracies to start with. What happened with Magna carta if that wasn’t the start of all freedom of speak and law and order, first issued in 1215 in Britain and revised subsequently to protect the individual English freedoms. The US constitution was based on this in 1787. Since when did the EU court of human rights invent anything before we did. We even abolish slavery in the mid 19th century, long before America who took until the 1970’s to finally get it sorted!

    Habeas corpus – Medieval Latin translating roughly to “You should have the body” is a recourse in law whereby a person can report an unlawful detention or imprisonment before a court. This was the basis for individual liberty and we had here hundreds of years ago, never mind what the EU court has decided.
    Bleep bleep.

    As for all that stuff you regurgitate, as though they are facts about the repercussions of us leaving the EU, it’s all speculation, looking to the stars, scare mongering. No one knows what will happen, it is a matter for negotiation once we get out. The EU isn’t going to play hard ball, they need our business more than we need theirs. As for the UK providing a gate way to Europe, we are still a natural intermediary as despite speaking the same language, we share the same ideals and participate together in all sorts. This ain’t going to change. As you say, the US needs our security support.

    The US isn’t about to have the same relationship with Germany or France, even if there is one. And why shouldn’t we trade with whoever we want, back of the queue or not (hard to believe), Obama would say that wouldn’t he, he’s a fello socialist and they are for remain here.

    With the current state of the EU both financially and politically, who’s to say it will survive after our departure. Is it really the bureaucratic dictatorship of Brussels that is stopping WW3 in Europe? I don’t think so. Jobs for the boys there, just like so many of Europe’s member states and how they run things. Closer federal integration is inevitable if we help fuel this monster.

    Where is the government led fair facts debate? All we get is a biased leaflet, that is full of opinion. This should have been a factual list of pros and cons as far as anyone with any knowledge could put then together. The fact is that no one actually knows what will happen, just the same as when all the brains in financial circles said we should join the Euro. What a catastrophe that would have been!

  4. Sounds like speculation for leaving just as much as staying…the fact is what will the people be accustomed to?
    You are enticed by what by what you did first, what about what is is good for the people, how will they fair while your over confidence demolishes what they have while you play around with trying to forge a new deal?
    What exactly is your argument Pip as I am lost in your directed arguments to belittle and not articulate an adult perspective.
    I am in the clouds most of the time but none of what was said convinced me of anything but there is someone who has displaced frustration.

    Taking about frustration ‘bleep bleep’

  5. You just have to follow your heart Casper. There are no known definitives to guide you, only speculation both ways as to how it will pan out. Staying will be more of the same, too many people not necessarily of the nature we need, overstretched infrastructure and services to our detriment. Leaving will be control of our own destiny, no enforced rules, selective immigration, buy and sell with whomever we want. It’s not anti Europe and we had freedom to roam prior to the EU. It was only forged by central European countries desperate to avoid another war. You know which way I lean.

  6. Interesting.
    Very interesting.
    Thanks Pips, that certainly has made me want to reevaluate my decision. I will look further into it one evening, Ill buy a tub of ben and jerry’s it might be a long night, I wouldn’t take an exam without preparation :-).
    I must say though the media hasn’t got much to work on in terms of those that are representing the leave campaign.

    Casper X

  7. Philippa just a thought.
    If we have had control and had rules and guidance and they still messed up, why would you consider rewarding by giving more freedom, choice etc
    Or are you blaming the EU for that?

  8. Dear Philippa,

    Thanks for your comment.

    You might want to review the video. It addresses Magna Carta, Freedom of Speech, the EUCHR, etc.

    Through various laws against terrorism the privileges of magna carta were taken away. F. e.. in the UK anyone can be held now for three days without legal representation, without a trial, without a court order, and without the right to remain silent.
    Today the EU convention on human rights – written mostly by English judges after WW II as pointed out in the video – offers more protection, than current UK laws.

    The US constitution was influenced by magna carta and the bill of rights. And by ancient Roman laws – like in checks and balances, French laws – see Montesquieu, and other laws from other countries.

    Wrong is: “they need our business more than we need theirs.”
    The UK has a negative trade balance. You depend upon imports.
    And after the UK lost the EU headquarters, and assembly of goods for EU exports, the trade deficit will worsen. We just don’t know yet, how quickly and by how much.

    It gets worse, the UK hase the second largest dept – as a percentage of GDB – in the world, after the USA.
    And what is disastrous, the UK depends upon foreigners to maintain this dept. The UK has the third highest foreign dept ratio, after Luxembourg and Iceland.

    Talking about money, since introduction of the Euro, the GBP lost 10% of its value against the Euro.

    Also wrong: the UK could stay a gate way to Europe. Leaving the EU means giving up that position.

    Finally, as a non-member the UK cannot represent US interest within (!) the EU.

    ER

  9. You take the high road and I’ll take the low –
    And I’ll be in heaven afore ye!!!
    Baloney ER.
    A riposte very soon.

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