When a good friend does something that you suggested he or she not do as it is fraught with peril, you are concerned, but still care for them and pull for them. This is especially true when, as an outsider, you can see more clearly the troubles with a decision to do something. It gives you a sick feeling, but you will do your best to help them soldier on.
That is how many feel about our friends in the UK with Brexit, a vote to leave the European Union. I recognize the EU is imperfect like any government entity and needs improvements, but the global construct is more beneficial than it is not, due to more trade and freedom of movement. Working collaboratively, also helps lessen the risk of national turmoil which can cause unhealthy behaviors.
The global financial markets have shown an immediate displeasure with the change with significant declines and the pound priced at a 35 year low. Watching BBC World News America and PBS Newshour, where many global financial and political experts spoke, the sense is this is not just a short term aberration and that the Brexit will cause more long term financial anguish. Plus, with Scotland poised to initiate another referendum to leave the UK, this time to rejoin the EU, coupled with Northern Ireland considering the same, this does not look promising. June 23, 2016 may be remembered as the beginning of the end of the current UK construct.
All of this is unfortunate. Clearly, the UK citizens have a right to decide on their own country. Yet, in addition to Scottish and Northern Irish voters wanting to remain, the people under the age of 35 clearly wanted to remain, as they see the continued job opportunities with a solid EU. So, this is not a universally appreciated decision. What these folks see is non-UK companies setting up headquarters in the UK for their Europe business. With this change, my guess is some will consider relocating those to the Republic of Ireland or on the main continent. London’s loss may be Dublin, Paris or Frankfurt’s gain.
The UK will soldier on and the US will continue to support it. We will pull for you, but the climb is now more uphill. We should be reducing barriers to trade, not erecting them. No one is relishing redoing trade agreements with all of these entities. The uncertainty created just by this process alone will cause issues. Plus, it adds the uncertainty of other EU countries following suit. The more disruption, the harder trade becomes and creates opportunities for unhealthy nationalism.
The EU does need to do a better job of governance. The EU does need to do a better job of allowing the pipe on immigrants to be tightened and loosened dependent on the labor demands of an individual country. These are fixable problems, but they need to be worked at collectively and with due consideration of one’s country’s labor market. Leaving the EU makes everything a little bit harder to accomplish.
I know the “Leave” voters are happy, but the rest of the world is saddened (with some exceptions), that the vote to remain was defeated. And, that is unfortunate. It would be my sincere hope is that the next few months will allow the UK to reconsider its decision and proceed with a new vote. This may be precipitated by a need to ward off Scottish and Northern Irish votes to leave the UK.