BREXIT – Are you In or Out?


On Thursday 23rd June Britain will decide whether to stay put or bid au revoir to the EU.

From the outset, I would like to point out I have no idea which way to vote and am not a member of any political party. These are purely just my observations and not an indication of which way anyone should vote.

But what is the best decision?

Like a game of cricket there are two sides: in and out.

The team that’s IN says the best thing to do is stay in and the team that’s OUT says the best thing to do is leave.

And all their arguments just seem to be contradictions of each other – and it’s beginning to sound like a well-loved Monty Python sketch.

But what is the best decision? How do we make up our minds?

Since it is probably the biggest decision the UK has had to make since deciding to join the Common Market in 1975 should we simply just toss a coin, try and find out as much information as possible ignore everyone else and draw our own logical conclusions, or simply just tune in to WII-FM and vote according to which camp we think we (as individuals) will be better off?

I guess my first question would be whether the UK really is well-regarded and considered as an influential power within the EU at present.

If it is, then that sort of gives team IN the edge. If not, then really what have we got to lose by leaving?

From what I’ve read, or at least tried to research, there’s a lot of scare-mongering going on. It’s all going to be doom and gloom whichever way we vote.

But I think in all honesty, it’s not going be like the morning after a night on the town, or ripping off a band aid. We aren’t suddenly going to wake up on June 24th and find the world has stopped, everyone’s jobs have gone and the price of food and flights to Europe increased infinitesimally overnight, whichever way the vote goes.

Which leads me to my second question, if we stay in, despite the pro-EU leaflet saying we have special status and won’t join the Euro or be part of any further political integration, won’t that kind of making our membership a little bit null and void. A bit like being on a team but not really being part of the team, so to speak.

And as we’ve already, apparently secured a permanent out from joining the Euro, or be part of any further political integration, doesn’t that give team OUT the edge?

I make that one all! And still the decision is no clearer!

So, moving on to the hot topics, that are categorised in the IN and OUT leaflets, regarding the vote.

  1. The Economy

The pro-EU leaflet states that “The EU is by far the UK’s biggest trading partner. EU countries buy 44% of everything we sell abroad, from cars to insurance. Remaining inside the EU guarantees our full access to its Single Market. By contrast, leaving creates uncertainty and risk.”

Now, playing devil’s advocate and ever the mathematician, what drew my eye was the number 44%. So the EU may buy 44% of total UK exports, but let’s just flip that around. That means that 56% of total UK exports are sold elsewhere and surely that is a bigger percentage. So if we sell more stuff to outside Europe then surely that negates the leaflet’s next point that “Remaining inside the EU guarantees our full access to its Single Market. By contrast, leaving creates uncertainty and risk

Which leads me to my third question – when 56%, or more than half, of total UK exports are sold outside the EU, how can leaving the EU create such a huge risk to UK exports?

Also, if EU countries are buying goods will they suddenly stop buying them on June 24th if we leave? And on the flip side will they suddenly stop exporting cars and goods to us?

If that does prove to be the case then they clearly aren’t very good at running businesses. From where I stand I certainly can’t see Mr Head of BMW say “we’ll stop selling cars to the UK, our profit margin doesn’t matter?”

The pro-EU leaflet also states that “The Single Market makes it easier and cheaper for UK companies to sell their products outside the UK, creating jobs as a result.” But who to? This sentence is not qualified. Since less than half of total UK exports end going to the Single Market is this just a red herring ‘scaremongering’ sentence?

It may take some time to sort out new arrangements, but I don’t see that by leaving the EU we will lose full access to selling to the EU.

Now, moving on to team OUT’s leaflet – they say that “at the moment the UK has no trade deals with important countries like China, India and Australia. If we vote to remain in the EU, we won’t be able to make our own deals. We’ll keep having the same old rows about bailing out the euro (€).”

Why don’t we have these deals yet? China and India have been up-and-coming economies over the last 15 years, who has been sleeping on the job and not getting this done.

The Chinese President did visit last year and there was some stuff I read about bi-lateral agreements, but I couldn’t find any mention of a formal trade agreement (please correct me if I’m wrong)

As for Australia and the rest of the commonwealth – well according to Wikipedia “Britain’s entry into the European Economic Community (EEC) in 1973, and its evolution as a member state of the European Union (EU) has meant that for practical purposes, the United Kingdom cannot independently enter into negotiations with Commonwealth states to establish a free trade agreement. Instead, the EU, as a representative of all its members, negotiates collectively.”

So much for the Commonwealth Free Trade process!

Is that a win for team OUT? (I guess that makes it 2-1)

 

  1. Improving our lives

According to the IN leaflet this is separated into “Cost of Living” and “Travel Abroad”

Cost of Living

Their leaflet states that “If the UK voted to leave the EU, the resulting economic shock would put pressure on the value of the pound, which would risk higher prices of some household goods and damage living standards.”

No one knows exactly what will happen should the vote go to the OUT camp or indeed to the IN camp.

So, is it fair to state that there will be an economic shock?

Would it be a long-lasting and catastrophic shock (as in the case of Japan in the early 90s), or would it just be a short-term panic shock and then back to business as usual?

Is that sentence, and the use of the word “risk” surely just playing into the fear factor?

Looking at the value of the pound against the dollar over the last couple of months there was a definite bottom to the graph at the beginning of March – where you got just under $1.40 to the pound – but the graph has been slowly, but steadily climbing back upwards thus showing the value of pound is getting stronger.

And if you just use the FOREX as a guide, there’s always some kind of fluctuation when major announcements happen, some big some small, but it always manages to bounce back.

Again, nothing will happen instantaneously. It will take time to re-negotiate trade agreements should the OUT vote win, and whilst there may be some increase in the cost of living, as it will have been spread over a length of time (the leaflet suggest it will take 10 years to sort out trade agreements) surely it any increase will be absorbed into the general increase in living costs that we have endured over the years anyway?

So, is there any substance to this claim? I have no clue, and no counter-argument as the OUT leaflet doesn’t mention cost of living.

Travel Abroad

Will it become more expensive to travel in Europe if the OUT vote wins?

According to the IN leaflet, “EU reforms in the 1990s have resulted in a drop in fares of over 40% for lower cost flights.”

Is this really the sole reason for voting IN?

Having used certain low-cost airlines over the years, it’s not always that cheap, and sometimes the destination really is miles from anywhere! In fact, once I found it was cheaper to actually use a national airline than a budget one.

I don’t this can be chalked up as a win for team IN, so the score stands at 2-1

 

  1. Immigration & Border Control

Onto a big, hot topic here.

Team IN states that “The Government has negotiated a deal that will make our benefits system less of a draw for EU citizens. In future, new EU migrants will not have full access to certain benefits until they have worked here for up to four years. The Government will have greater powers to take action where there is abuse of our immigration system. Some argue that leaving the EU would give us more freedom to limit immigration. But in return for the economic benefits of access to the EU’s Single Market, non-EU countries – such as Norway – have had to accept the right of all EU citizens to live and work in their country.”

Team OUT states that “If we vote to remain in the EU, we’ll be stuck with an out-of-control immigration system which is bad for our security. The European Courts will be in charge of who we let in, and who we can remove. Imagine if Turkey joins this broken system. If we Vote Leave, we will be able to have a fairer, more humane system based on the skills we need. We’ll be able to control numbers without having to turn away talented people from outside the EU who want to contribute.”

To be fair, I can see valid points to both sides of the argument here.

Both sides seem to agree that the immigration system is out of control and there does need to be some form of more stringent controls.

To be honest I like the idea of a points system and skills shortage lists like they have in Canada, Australia and New Zealand (and how bummed was I to be 10 points under the limit for NZ – still my dream of moving there is not dampened – but I digress)

With regard to border controls, there’s no mention of this in team OUT’s leaflet, and team IN quite rightly states that we are not part of the EU’s border-free zone, and that the UK has the right to check everyone arriving whether they are from an EU country or not.

Hmm, well I’ve been through border control and seen everyone waved through bar me, just because SC has a different surname and I have to prove he’s my son (do they want to see the scars?) – and yes I seriously do have to carry his birth certificate to prove it (never mind my surname is also part of his name!!!)

I’m so totally chickening out of any further discussion on this one, so I think I’m calling it a draw!

 

  1. EU Member Benefits

Team IN states that “For every £1 paid in tax, a little over 1p goes to the EU.”

Team in states that “We send over £350 million to the EU every week – enough to build a modern hospital every week of the year.”

So, I’ve done some delving and being a mathematician some quick calculations.

A website called “fullfact.org” broke down the EU payments as shown here:

  • £18Billion – is what we should pay
  • £5Billion – is our instant rebate – so we never pay this and our Membership Subscription (for want of a better word) is £13Billion
  • BUT we also get £4.5Billion coming back due to EU spending on the UK

So our total bill is £8.5Billion which is not (sorry Team OUT) £350Million a week, but £250Million a week.

Pah! What’s £100Million amongst friends?

It is still an extortionate amount of money, and yes would do an inordinate amount of good building better health services, new schools, etc.

BUT! And here’s the but.

If you spin it with Team IN’s argument and look at the Tax Revenue (courtesy of “economicshelp.org”) for the UK, you can see the UK government collected during 2013/2014 £490Billion. That’s just purely tax collected not including any assets, interest, etc.

So if we work out the percentage our EU Membership costs, we get that 1.73% of taxes collected goes to the EU. Which sounds a lot a better really, and quite frankly begs another question what exactly happens to the remaining 98.27% of tax revenue??

It’s amazing how the same things can look so different from different angles, isn’t it?

Based on these figures alone, I think Team IN can chalk this one up as a win. (2-2)

 

  1. Control over our Laws

Team OUT state that “If we vote to remain, EU laws will overrule UK laws and the European Courts will be in control of our trade, our borders, and big decisions like whether prisoners are allowed to vote. If we Vote Leave, UK laws will have ultimate authority and we will take back control. We should be able to vote out the people who make our laws.

Team IN makes no comment on this issue.

On a common sense ground, surely as a democratic society we should be able to vote out people who make our laws, if we don’t like what they are doing? And on this basis if we don’t have a say in who is making the laws, where has our democratic right gone?

As there is no opposing argument, I can’t chalk this up as a win.

 

So at the end of a hard fought match we have …

A TIE!!!

Seriously?

Looks like I’ll be flipping a coin then!

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