With a hard Brexit, Britain is shooting itself in both feet and then trying to dribble like Messi.
What next for the world,
What next for us?
What next for the world,
Is it written on a bus?
What next for the world,
What next for the good?
What next for the bad,
What will happen –
Is it time for us to live the future free?
The effect of technology on future employment, as highlighted by business leaders at Davos, is profound. More and more software, computers and robots will be replacing human workers, and some of it has already happened (think the lack of as many human cashiers in supermarkets).
One answer to the increased joblessness and lack of expendable income is a “spending wage” for citizens for doing no work at all. This would stimulate the economy by allowing people to purchase consumer goods, though it may not solve the self-esteem issue of people not feeling that they have a purpose in life, or that they at least have a diminished purpose in life.
Thomas Picketty, a French economist who, as written in his highly-talked-about book ‘Capital in the 21st Century’ released in 2013, believes that wealth should be taxed in order to regulate capitalism, may live to see this desire happen, as the damaging aftermath of the HSBC scandal, Panama Papers and the clamp-down on corporate tax avoidance suggests. This could be only considered a good thing for everyday people, as taxes are a great way of funding a thriving society.
Picketty may be wrong, however, in suggesting that global growth is going to slow, thus allowing capital owners’ bank balance to rise in proportion to the incomes of normal tax payers. “Infra technological frontier” countries such as China, Nigeria, Indonesia and India may help keep global economic growth higher than the rate of return on capital. In 2013, the rate of return on capital was a bit above zero per cent (Picketty believes that in order for capital to create a more and more unequal society, the rate of return on capital needs to rise above 2.5 per cent).
It’s not unthinkable that the rate of return on capital may indeed go into negative territory. Also, it would seem to be the case that global convergence between Africa, China and India could take a century, or perhaps longer than that, to happen (global convergence would lead to lower growth rates and the rise in prominence of capital, which could send Europe and North America back to the nineteenth century in terms of economic equality). Indeed, the convergence may never happen as the economies of countries from North America, Asia and Africa will likely go up and down, such that convergence may always be out of their grasp.
The rise in prominence of Picketty and his ideas about taxing wealth signal that the push to increase Ireland’s corporation tax will only grow more aggressive as time goes on.
So the unthinkable happened: Brexit. It appears that the fear and accompanying hatred of immigrants and the promise of a better Britain overcame the fear of leaving the EU. For Ireland and Britain, other countries and the global economy this is most definitely bad news. It’s a cultural tragedy that Ireland and Britain will now not be as European as each other. This decision will cause a mini recession in Britain, quite probably.
It will have a negative effect on Ireland’s economy. Britain might become weaker economically and politically and very ironically have a big reliance on outside countries to help it limit the economic and political damage. The country may descend into right-wing politics before the younger generation – and disaffected citizens generally – decide to vote for left-wing parties.
Most likely it will be a lesson some of the British public will have to learn: Britain is stronger economically and politically in the EU. Another one would be to not let the media and politicians take advantage of you; be a critical thinker. The tabloid media generally were arguably the cheerleaders of Brexit for their own agenda of selling papers and perhaps for tax and lack-of-EU-oversight reasons. They possibly heightened British peoples’ fear of immigrants and some even explicitly came out in favour of Brexit. Even the rest of the media were somewhat complicit in allowing the “Leave” side to win by allowing the referendum debate to be centered on immigration and not arguing in favour of immigrants in terms of what they add to Britain.
And the politicians in favour of Brexit were conceivably more motivated by their own possible political gain in backing Brexit than they were motivated to do something good for their citizens. If the half of the British public led astray learn these lessons and decide, years from now, to rejoin the EU, it may be on the EU’S terms, as Britain would be in a weak bargaining position. They may have to join the euro, for instance. Perhaps then the British public will stop blaming the EU for its problems and instead reform its own country. Examples may be creating enough better-paying jobs, breaking up its banks to end “too big to fail” and improve service and reforming its political system.
Johnson, Farage and Gove, along with the tabloid media generally, may be detested in the years to come by the half of the public that was on their side (alongside the other half, of course). And the rest of the media may not be seen in a favourable light either.
Scotland and possibly Northern Ireland may soon seek to extricate themselves from the United Kingdom. This could deal more economic damage to England and Wales. Scotland leaving could hurt the Labour Party in Britain, as they derive a lot of their support from that country. And the Queen will not be amused to see her empire crumble. And maybe if what’s left of Britain declines economically some of the public may blame the immigrants who are already in the country for their woes once again.
But it may be all alright. The world moves on. We will all adapt.
Brexit won’t happen. Fear is too powerful a force. But, anyway, it’s in Britain’s best interests to remain in the EU. It’s also in Ireland’s best interests, along with the rest of EU.
If Britain were to leave the EU it would disallow free trade between Britain and the rest of the EU members. It might be seen as a reason for companies to think twice about investing in Britain. Sure, Britain would still be a big market on its own, but it would make things more awkward and complicated for companies to set-up there because of Britain’s laws being out of kilter with the EU laws.
It would also make Britain weaker as an economy, as it would no longer be part of a very important club. Some people who want Britain to leave want the country to go back to the glory days of British power. But it seems that at present Britain is very far away from that. And I don’t think the British public will be patient with such a project. And I doubt that project would succeed, anyhow. People in favour of Brexit want the country to essentially isolate itself and hope China and others come to its aid. I think that an isolated Britain wouldn’t have a good bargaining position with potential helpers.
Also, if Britain became weaker this would be bad news for the US and many other countries because all these countries benefit from certainty.
It would disrupt the easy-going relationship that Ireland has fostered with Britain. The British would still be our closest neighbours, but psychologically wouldn’t seem to be as connected to us as before. We would be living under EU policy and rules, but Britain would not. They wouldn’t be as European as us. It would be a cultural tragedy.