Kaiserschmarrn wrote:My point is that this is about trade-offs and a population like the Brits who were on average never particularly fond of the EU and especially its political aspects may well be prepared to sacrifice such a low contribution to growth in order to retain their independence. Additionally, the UK is one of the most well-positioned EU members to make up for it through its relationships with the rest of the world.
The UK is divided on Europe as shown by the referendum. Cameron couldn't have picked a worse time to hold it actually - during the migrant crisis. But to put things into context, as pointed out by a fellow PoFoer, less than 40% of UK citizens actually voted to leave the EU. So despite what was occuring and all the fear-mongering taking place about being flooded with refugees, it still didn't result in what I call a decisive madate to make an important decision to leave (something like leaving the EU in my opinion requires at least 65% of the electorate to prevent division). So arrogance and stupidity resulted in this gamble going wrong. Not fondness.
Another issue I had with this referendum - that would have given people a better sense of the costs of leaving, was that there was no manifesto on what the Brexiteers planned on doing should we vote to leave the EU. Brexiteers promised everything, but as shown since, will not be able to fulfil such promises. Even since the vote, there seems to be no plans revealed to give businesses confidence should no deal be achieved. So to your point about new trade deals with the rest of the world to compensate for the single market, I can't see how anything could be better (or replace it). And that is due to geography. No matter what deals are created with the rest of the world, the EU will always be out biggest trading partner - whether it be WTO or tariff free. The only advantage for the UK is that they have a trade deficit with the EU so are able to compensate their businesses with business rate deductions from tariff income and EU membership money (so to entice businesses to invest here). The problem is of course, that should there be a negative consequence due to Brexit, people can only buy your products if they can afford to do so - whether inside the UK or outside the UK. Hence why I think it is better to keep Europe together and to look after everyones interests. Brexit serves no ones interest.
And this leads into your last point. People vote with their pockets. People don't really give a shit who or where their laws come from (independence) as long as it doesn't effect them financially. Brexit will be judged on this very point. So perhaps the UK government needs to either reconsider another vote on Europe (with a manifesto) or start pulling their fingers out and publish policies with what they can actually achieve with certainty from Brexit. Because I can assure you with one thing, without goals that they can fall back unto, should there be a downturn, all people will remember is the false promises of great wealth during the Brexit campaign and blame the government who is in power for not achieving these promises.
Even the decade long EU membership hasn't changed the UK enough for its economy to be suitable for the euro or to be more integrated than with non-EU countries in terms of trade or value chains. While geographical proximity matters, it's by no means the only or most important factor.
The Euro would have suited the UK actually, the same way Germany benefits from it today. It doesn't suit poorer nations. The solution to the Euro is simple. Either create a second Euro currency for poorer nations to devalue if need be or to federalise the currency union and bring the responsibility of the Euro to all of the Eurozone and taking it way from individual states (so say Greece doesn't hold all the burden and is sent into a debt it will stuggle to pay).
There's also the fact that economic gains have a tendency to decrease over time and come at a higher cost in terms of independence and sovereignty. You can easily observe this by looking at today's FTAs which often don't have a whole lot to do with actual trade despite their name. The costs are obviously restrictions in terms of how much people are able to regulate and legislate their own affairs, e.g. membership in the single market leads to pressure to homogenize tax policies and this pressure is increased by the very existence of a centralised bureaucracy which will invariably argue that centralising powers and competencies is more efficient. This is not necessarily unreasonable, but people ought to realise that some form of centralisation is the most likely outcome down the line and that this is especially true in an EU context.
Strict legislation brings in high standards within products. I assume you want good quality of goods? The UK will still have to adhere to single market rules to trade within the single market. I can't see how independence is going to benefit here.
Let's not pretend that the alternative to the EU is autarky please. Obviously the impact for the UK and to a lesser extent the EU will depend on the maturity of the two parties. If the EU's objective is to increase prosperity and cooperation across Europe, as it claims, it ought to not submit to the temptation to be vindictive. A reasonable outcome is eminently possible.
The EU can't make it attractive to leave. Why would they do a deal that gives the UK everything without any burden? Nonetheless I have said countless times on here that a trade deal actually benefits the EU more than the UK. It's services that the UK needs from the EU. Without a deal on that, it be unlikely there be a trade deal anyway. Hence why if I was the UK negotiator, the delay on talking about trade wouldn't bother me. I would just publish a plan on tax breaks for businesses to compensate for a no deal instead and explain I still wanted a trade deal with the EU.
It's glaringly obvious that Ukraine is not a good example, as the alternative for the UK is not a "Soviet model". Further, we had this discussion about the difference between the Eastern European EU-members and former Soviet republics in another thread where I showed that the difference in GDP growth isn't as large as is often assumed. If we take into account their starting points in terms of GDP, their geographical proximity and the extent to which they were economically integrated with the Soviet Union we can explain some of the disparity. Further, countries like Hungary had already started to liberalise their economies prior to the fall of the Iron Curtain and some Eastern European states had long-standing ties with Central Europe. That's not to say that EU membership doesn't have a positive impact but that it's often greatly exaggerated.
Ukraine is an example of a nation within Europe who has not benefited from the single market at any point. They are a prime example to show the importance of the single market. There is Ukraine and there is Poland. Both were in the Warsaw pact and both needed investment since the curtain fell. Who is better off? Stats or estimates on GDP doesn't mean much when you can actually see the difference visually.
And as Ukraine have a great food export economy, should they have been in the single market, I could envisage them being quite wealthy today actually.