The Germans are saying no access to the single market if the UK votes for Brexit, and Cameron has said he’ll take a Brexit vote as a signal to pull us out of the single market as well. Although both sides could backtrack on this, it would be difficult after all this has been said. So a Norway deal is out. Even a Swiss style thing is impossible. So what would Brexit look like then? I think I’ve finally figured it out.
I once thought that building a Eurosceptic view from the left was easier than from the right. This was because I could see why the Left thought of the EU as a free market project – that’s because it is. Meanwhile, I always wondered why people who considered themselves conservative figured that taking a massive risk like leaving the EU would be worth it. This week I finally, really got it: Brexit is a huge risk – just not for them personally. For them it really is a once in a century opportunity, not just because we’re holding a referendum, but because of the circumstances under which we are having it.
If Brexit happens, it would be the final triumph of the Right in Britain. I don’t see how anything centre-left comes back after it. Because the following is likely to take place if we vote to Leave on June 23rd.
Whether Cameron goes or not is immaterial, really. He’ll either be forced to quit or manage to convince his parliamentary party that having campaigned against Brexit puts him in the best position politically to carry through what Brexit really means – which he would probably be correct about. Whomever is prime minister, there is only one option outside of the Norway one which does not involve the economy going completely down the toilet almost immediately: a WTO deal. Only, I hear you say, the WTO isn’t going to give the UK some sort of ideal deal right away. It will take years to sort out, right? Not if the UK agrees to drop all tariffs altogether, on a worldwide basis. Then the WTO will give the UK a deal as quickly as they can.
One of the WTO’s principle aims is a tariff free world. So if one of the world’s largest economies decides to drop all tariffs, they would bend over backwards for that country. There would still possibly be holdups while deals were agreed, but the WTO would work as hard as possible for the UK to get through this.
No tariffs would mean every nation on Earth could trade on equal terms with homegrown goods so long as they opened their markets up to Britain. This would be a no-brainer for China, India, and most large developing economies. If this went ahead, certain portions of UK industry would do very well out it. Others, like steel or car manufacturing, would be totally finished inside of a year.
There would be a large swing from the poor to the rich in terms of wealth as jobs at the lower end of the scale were either done away with or had its wages slashed. Scotland would almost certainly go, not because of SNP agitation, but just simply because an England trying to be a Singapore off the coast of France would be totally incompatible with the Scots desire to be a Scandinavian style social democracy. Taxes would have to come down to attract even more trade, as public services were massively rolled backed. The NHS would move to an insurance model over several years, quietly. Immigration wouldn’t go down, but rather up – first off, when the Brexit vote is announced and everyone in the EU who has ever wanted to move to the UK does so as they know they only have two years at most to do it in. Once the UK is out of the EU, immigration is high still but very different than pre-2016 migration; as the economy changes dramatically, and some industries die while others explode, getting in top talent from around the world becomes necessary. Businesses like the fact that they can get almost anyone in from anywhere with little red tape and do not have to rely on people they need being by chance EU citizens.
Meanwhile, the poorest parts of the country get even poorer. How you avoid South American style slums is hard for me to imagine, as housing benefit is eliminated in this new hyper-free market economy.
Some of you might say all of the above is speculation – and it is. But are we still supposed to believe that Boris Johnson and John Redwood are bleeding heart socialists whose concerns about the NHS keeps them up at night? The above vision of Great Britain becoming a reality is why people like John Redwood are pro-Brexit in the first place. That’s where Euroscepticism comes from on the Right – this idea of a Britain that could be a low-tax, small-state, low-regulation, able to “control” immigration by having low level free movement from around the world, not just the European Union, but only free movement of the globalised, reasonably wealthy.
If only we left the EU. The Right’s wish might be about to come true – off the back of traditional Labour voters, worried about immigration leading to lower wages, voting for the exact opposite thing they really wanted in every possible sense.
Con Logue says
Indeed. This is why I also firmly believe that promises that the Irish border remains open are pure speculation as well.
Nicholas Martin says
The big trade barriers today are generally not tariff, but non-tariff barriers (i.e., regulation). While China might be happy to drop all tariffs on UK goods (tho’ I frankly doubt it — they maintain quite high tariffs on many things, for protective purposes), it would certainly not drop all non-tariff barriers. So financial and business service companies trying to do business in China would still struggle (at the very best), and exporters to China would continue to labour under many regulatory restrictions. I’m also not sure what the WTO (a bunch of civil servants and administrators) could really do to “help” the UK, since decisions over lowering tariffs & other trade barriers are national decisions, and I’m not sure what the WTO itself could offer countries in return for them treating the UK kindly.
Joe V says
When you say ‘Low Tax’, I presume you’re only talking about the higher rate coming down or being abolished? I’m guessing that the 20% rate will stay and this will benefit only the higher paid segment of the population?
Thomas Zunder says
Right on comrade. Remain and work with our socialist comrades to make a better Europe. It may not be perfect but Europe is the home of socialism.