Remain

The Case for Remain

Today is perhaps the biggest decision the UK will ever face. Under 18s will be most affected by this decision but can’t vote. Brits can. More important than which way we vote is that we should vote.

I’m normally politically apathetic (only voted once) but this is such a key decision, I’ve spent hours researching the facts and evidence (often misportrayed) with an open mind – in fact, I earlier posted a detailed blog on the case for Brexit). After all that, my personal view is overwhelmingly for Remain.

1) JOBS. Thousands of firms are here because of access to the Single Market – a “passport” that allows them to sell to 500m customers in 28 countries, rather than 60m in 1.

40% of international firms’ European HQs are in London. (#2 is Paris with only 8%.) Many will relocate significantly to the EU upon Brexit. JP Morgan stated they’ll cut 4,000 jobs, HSBC 1,000. 2/3 of the financial services industry is outside London; it’s not just rich bankers. (Source: Alastair Lukies in CityAM).

What about non-UK folks stealing UK jobs? The evidence just doesn’t support this. The LSE’s Centre for Economic Performance found that immigration doesn’t harm wages, jobs, or public services. Immigrants buy goods and services, generating employment for Brits.

2) INVESTMENT. 70% of investors in the UK link their decision to invest to the UK being in the Single Market. Investment provides jobs.

3) TRADE. UK exporters benefit from not needing to pay the EU’s Common Customs Tariff if they export to the EU. The Leave campaign says the EU isn’t important to us. The facts don’t show this. 45% of the UK’s trade is with the EU, versus only 18% with the USA and 3% with China

Much has been made of the UK’s ability to negotiate its own trade deal post-Brexit. But:

– The average time to broker a trade deal is 28 months. It’s true the UK will benefit from the Single Market for 24 months post-Brexit. But, 28 months is the relevant figure. From month 1 (not month 25), firms will reduce investment due to uncertainty. They already have been.

– The UK will still be the world’s #5 economy. But, the RANK is not what matters, but the RELATIVE SIZE. The UK will be far, far smaller than (say) China, and be dictated to in trade negotiations.

4) THE ECONOMY. Stock markets aren’t always right. But, they’re pretty good. The market jumped 3% on Monday upon hopes of Remain. That’s £60 billion pounds. The stock market isn’t owned just by the mega-rich – but also by pension funds and insurance companies. And, it’s not just paper money. Let’s say the probability of Remain rose by 10% on Monday. A £60bn rise means that the UK economy will be worth (in terms of output) £600bn more upon Remain. (£60bn = 10% * £600bn).

The National Institute of Economic and Social Research forecasts GDP in 2019 will fall by 2.1-3.5%, reducing public finances by £20-40bn (AFTER including the reduced EU contribution). The Institute for Fiscal Studies predicts that “Austerity would be extended by another year (optimistic scenario) or another two years” – leading to further job losses.

5) SCIENCE AND TECHNOLOGY. Over 50% of nanotechnology and evolutionary biology funding comes from the EU. A common funding source helps collaboration between EU labs. Otherwise, a project between labs in 3 countries would require 3 separate applications. Digital Science forecasts that Brexit would cost UK science £1 bn. Source: The Economist.

6) PEACE. As Richard Branson wrote, “One of the EU’s most important achievements is that it has kept its members out of conflict in Europe. I represent the first generation of my family not to go to war in Europe. For centuries, almost every generation was at war with one European country or another.”

Both the UK and Eire being in the EU has played a major role in maintaining peace in Northern Ireland.

The UK’s membership of EU was a big factor behind Scotland’s decision to stay in the UK.

7) ENTREPRENEURSHIP / SMALL BUSINESSES. The Single Market catalyses startups, giving them access to 28 countries and helping them get off the ground. TransferWise (Estonia founded, UK based) has used it to expand across the EU. (Source: Alastair Lukies).

8) LESS BUREAUCRACY. Much is made out of EU’s overregulation. But, EU membership /reduces/ a lot of paperwork – in many areas that the public might not even realise.

Over half of channels broadcasting in more than EU state do so out of the UK, like Discovery Channel and MTV, using only one single license. If UK were outside, broadcasters would have to get separate licenses in all EU states (or leave UK). (Source: Alastair Lukies).

9) FREEDOM. A UK passport gives the right to travel, work, study, retire anywhere in the EU – without having to get visas (again, LESS bureaucracy, not more). This provides tremendous job and educational opportunities – but more importantly, culture and life experience ones.

(SOME) ARGUMENTS FOR BREXIT

1) UNELECTED BRUSSELS BUREAUCRATS. There are only 55,000 EU civil servants. The UK has 393,000. We don’t vote for Treasury or Home Office officials, or the Governor of the Bank of England. Source: LSE’s Nicholas Barr.

2) COST. Cost of EU membership is < 30p per person per day. Even a small reduction in trade or investment would dwarf any savings.

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