Monday, 12 December 2016

Post Brexit Nightmare

Yes, I'm blogging about Brexit again... Or more accurately what I fear will happen after we leave the EU. I hope this is hyperbole, but I fear that it won't be, simply because the calibre of politicians we have is pretty bad.

Let's assume, to begin with, that the negotiations are over in time, that by October 2018 the UK has left the EU. What then? We will essentially be sitting without economic ties, free trade deals or anything else. Those will take up to seven years to sort out, and we're now being warned that trade with our former EU partners is going to become more expensive, while CETA, the trade deal between the EU and Canada took about 20 years. So we run the risk of over a decade without the lucrative trade deals that Liam Fox is so keen to promise are just hanging there like low hanging fruit. My concern here is three-fold. First, as I've said before manufacturing only accounts for 10% of the UK's GDP, second Mr. Cameron's targets for competition in actually making things were India and China, which are basic secondary economies. This is telling, there is no plan to allow us to compete with Canada, the USA, Japan, or Germany. As ever the UK is washing its hands of actually making things, in a move that is an echo of our reluctance to adapt to the secondary stages of the Industrial Revolution or, in the 1970s, to grow our computer industry. The same appears to be true here, there is no plan, for example, to take advantage of our mass of coastline to develop tidal electric power, and then sell it overseas. Or, as we are fairly involved in the arms industry, why not build on our maritime past by developing stealth boats or a new wave of naval vessels? Since we'll be more dependent on the sea post Brexit we could work on developing ways to defend our shipping lanes.

This brings me to the third thing I fear, that leaving the EU will open the UK up to more asset stripping, multinational companies that don't have any intention to do anything beyond buy up our industries up cheap and gut them in the name of a quick buck. If there are factories attached they will be moved to somewhere cheaper (as Kraft did with Cadbury's) and we will only see an increase in the flow of jobs to places like India and China (our two great rivals, apparently). George Monbiot has outlined the dangers facing the democratic world from transnational capital here, far more eloquently and knowledgeably than I can. My basic analysis would be: company gets very big, puts lots of lawyers in pockets, uses said legal professionals to run rings around governments and get their own way. Company bad. Nod head. Get treat.

This sort of activity is nothing new, it's been the norm for about the last thirty years or so, and stems directly from the adoption of neoliberal economics by both Mr.s Thatcher and President Reagan. It's bracketed by the idea that the state should not be involved in the market, not even for long term investment. At one point it was assumed that this would be beneficial, Thomas Friedman's Golden Arches of Diplomacy was written for a reason, even if it no longer holds true. But the reality is that as the corporate sector has grown, it has become less accountable, more likely to greenwash and to sidestep laws it dislikes and to sue governments over decisions that affect profits. For example, Philip Morris sued the Australian government over packaging legislation that carried health warnings. The danger for Britain is that, if we have no trade deals, and if the government of the day deems the EU to be 'difficult' (as it apparently already does because Brussels is playing by its rules rather than wheeling and dealing in the fashion the Three Brexiteers seem to favour) that regulations and taxes to lure investors.

This is bad news. For us, I mean. There'll be no consequence for the businesses, nor I'm sure for Messrs. Davis, Fox, and Johnson. I imagine too that the Prime Minister will sit pretty in those very expensive leather trousers. But for the rest of us, it seems to suggest that the future of work in the UK might be low paid, semi-skilled and based on zero hours contracts, with the blessing of Westminster. It suggests the minimum wage will vanish, that workplace benefits will disappear and that we will sink into the sort of dead end economy that will do nothing for most of us. More, if those regulations cover environmental measures as well, we can expect more air pollution, perhaps even a return to the UK being the dirty man of Europe.

The question then becomes, will the public accept that? Recent polling has shown that the UK will not accept a cut in living standards or wages. But as the things that have caused mass unemployment in some parts of the country (it should be noted that at present the UK only has 5% unemployment, which is considered to be full employment by economists), will not have changed, and most of the UK's immigrants come from outside the EU.... The question is whether on the surface the things that apparently matter most to the people who cared about the Brexit aspect of the referendum will see anything actually change. If not, then there's a problem, especially if a) no new jobs are created and b) food become more expensive.

At this point we might see a slide towards the far right, politically, because hungry, desperate people are more likely to vote for change than something they see as maintaining the status quo (there's evidence the conflict in Syria was caused by a spike in food prices rather than Daesh being entirely like a supervillain and rubbing their hands together while they cackle). From there we might see a spike in racist crime or even attacks on women - in the same way that soldiers attacked women doing 'men's jobs after World War One. The nation slides into extremism because nobody trusts the news because there are no jobs, no food and the country has been sold out to foreign powers... albeit economic rather than political ones. Throw in an embattled health service and declining environment and you have a recipe for revolution and a 'purity' drive (because those are always a good thing, right?)

This feels like it could happen, to me, though as I said it is hyperbole. Or at least I hope it is. My concern, as I hope I've illustrated above is that there is no new politics really coming to the fore. Nobody seems to have a clue what to do once Brexit has been achieved and that worries me.

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