Some people on my Dayre have been asking me about what I thought about Brexit. Well I’ve been reading a lot about it in the news but I have never really gone through in detail what each camp is claiming and how true it is so I’ve never really had an opinion on it.
After the results and with the whole markets coming down though I finally decided to look into the whole debate. After all my research here’s what I finally think:
1) Brexit is bad for the economy in the short to medium run. No doubt about that.
2) While the price to pay for exiting the EU is a potential recession and a weaker British economy in the short to medium run, the plus side is that it gives more direct power to British nationals to influence their own laws.
Why is that?
In order to remain part of the EU, the UK has to adhere to a number of EU laws. These laws are passed by a council of people who some are British but are meant to be completely independent. The reason why they’re supposed to be independent is because while they’re British and nominated by their own government, on the EU council they’re supposed to take off their British hats and put on their European hats. They’re supposed to think about what’s best for the EU instead of what’s best for their individual country. A collective group can’t work if everyone is just trying to do things for their own best interest.
Yes it’s true that the UK has got a good deal with the EU. Some laws they don’t apply and there are some laws they can veto out. But yes… if a UK citizen wants absolute control of their own country’s fate then yes Brexit would make sense.
3) I don’t like the way the Leave camp campaigned. I thought it was racist and scare-mongering people in the UK of immigrants that come to UK borders. I feel that their victory is going to send a signal to all politicians that Trump-like politics or campaigning works. Being racist and making non-sensical rhetorics do win votes. That’s really sad not just for the UK but for the rest of the world.
4) The EU is not exactly doing really well as a union too. When I studied Economics at University College London we studied the EU. One of the major challenges the EU faces is that it’s a union of very distinct economies that have to abide by one monetary policy. That makes it really hard to control. Perhaps the EU would have worked better if they had economies that were more similar in terms of GDP per capita, cost of labour and productivity but the truth is it’s not.
5) To be fair though, the EU is still really young. It took many decades or centuries before China was united to be one country. So I feel it’s too early to judge but there are some true benefits the EU has yielded. Like peace among the major powers in Europe for the past decades after the two most brutal wars at the first half of the 20th century.
So what do I think? Should the UK have remained in the EU? I would have voted a YES… Stay in the EU.
Here’s what I think will happen in the future. I’ll probably look back many years from now and see if my predictions were right:
- The UK economy will be weak in the short to medium run but eventually they’ll find their own footing. I don’t think it would be as strong as it could have been with a well-working EU but we’ll never really know now.
- EU won’t fall apart as people predict but it’s likely some other member countries will leave too. I think that could be better because the problem with the EU in the first place was that they tried to grow too big too fast. Less countries in a similar economy level would make a better union.
- While everyone is predicting banks moving out of London, I think London won’t stop being the finance capital of Europe.
- Scotland will continue to be part of the UK.
- UK citizens will likely face a recession in the short run but in 5-10 years time they’ll all forget about this. People by then would probably write articles like “What if we had stayed in the EU?”…. but nobody would never really have known.
Okay those are my thoughts. See you in 2026 Tim!
Timothy Tiah – Co-Founder of Colony, Kuala Lumpur Co-Working Space