Brexit Implications

First, since Prime Minister David Cameron backed ‘Remain’, this is his defeat. No surprises then that Cameron has announced that he will quit by October and would attempt to ‘steady the ship’ in the meanwhile. More distant possibilities are a split in the Conservative party and another general election.

Second, Scotland, which voted to stay, will call for a new referendum on independence. And the Catholics of Northern Ireland will call for unification with Ireland – though they may not get it, since Protestants are in a majority. Scots may have called for another referendum even if Britain had stayed in, but now the calls will reach a crescendo.

Third, Britain will probably spend another year or more trying to negotiate the exit, and the resultant uncertainty is likely to damage growth, dent the pound sterling, and slow down investment decisions in Britain. The Tata Group, which owns Jaguar Land Rover (JLR) and Tata Steel (former Corus Steel), will be affected by higher tariffs imposed by the EU against British imports, and the steel company, which is on the block in the UK, will now have to figure out what Brexit means for them.

Fourth, Brexit will empower Euro-sceptics in other parts of the EU, which is now seen as a supra-state that is simply too big to manage on the basis of a consensus. France, for one, could seek a better deal from the EU, and the far right led by Marine le Pen is actually calling for a Frexit. Greece may wonder if it too should default on its loans and exit. Southern Europe, which is hurting from German-imposed austerity, may also begin to re-examine its premises. The trading union will probably stay, but countries may want more powers to be shifted back to national governments in areas like immigration.

Fifth, Brexit is a negative vote by the hinterland against London. As one of the world’s biggest financial centres, London is as international as they come, and it voted to stay. But the fatcats of finance are probably disliked by the rest of the country, which worries more about issues like British manufacturing decline and immigration. The ‘Leave’ vote shows how far the financial sector is from understanding what the real sector and real people feel. We saw that in America after 2008, and we are now seeing it in Britain.

Sixth, immigration is going to become an issue everywhere in Europe. With terrorism already becoming a big issue – Germany had a gunman shooting indiscriminately in a cinema theatre on the day of the Brexit vote – and with a major influx coming in from war-torn Syria, most EU countries are worried about Muslim immigration. The EU’s own rules that allow any citizen in a member country to work anywhere may have to be tweaked. In Britain, the huge influx has been from Poland. Ironically, Britain entered the Second World War when Germany invaded Poland; Britain is leaving the EU partly because it has been invaded by Poles in search of a better life.

Seventh, Brexit proves that the forces of nationalism and sub-nationalism do not die out just because of the creation of free trading unions and common markets. Economic gains do not always trump social and cultural concerns. Trade does not erase xenophobia and bigotry, which lie just below the surface. Political correctness keeps these feelings in check, but when growth is down, they surface. This is the case all across Europe and America. At the end of the day, no one sees his nationality as European; they still remain Brits, Germans, or even Scots or Irish.

Eighth, while the vote is not against free trade, the idea of the common currency will certainly come under the scanner all across Europe. The fact is countries prefer to change at their own pace, but a common currency forces deeper changes faster. If Greece had had its own currency, it could have let it depreciate against the euro, thus giving itself time to adjust to its lack of competitiveness.

Ninth, Brexit is also a vote against elitism, where ordinary citizens feel the national parties and busybody bureaucrats fail to understand what matters to them. The Narendra Modi election in 2014 was also a similar revolt against the English language elite who thought they knew what was good for the country. The message is politicians must listen before they lead.

Tenth, the biggest lesson, however, is that complex issues like joining or leaving a trading bloc should not be decided by referendum. At the end of the day, the ‘Leave’ campaign may have won by playing on fears over one single issue - immigration. It did not win the vote by thinking through the more complex issues involved, including the economic gains and losses. Logically, a third option should have been a mandate for renegotiating the rules of the EU, failing which Britain could leave. By giving voters only a yes/no option, and not ‘yes, but’ or ‘no, but’ options, referendums become reductive exercises. more  

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I disagree with your last point. When you have referendum, the citizens vote either yes or no. The votes are not split between three or more options. Therefore, you have a decisive vote which reflects the opinion of the majority that voted. Mostly, those who have not voted would have voted in the same ratio. In any case UK had not opted for the currency union and was not fully committed to the concept of European Union. It is good that they have decided to leave rather than being a member without adopting Common Currency. If you notice the voting pattern, the elderly have voted for the exit. It is the generation that has seen Britain as a world power and had fought in Second World War or were involved with reconstruction after the war. They have a sense of pride of being a part of huge British Empire and want to maintain that identity. We must appreciate that the politicians in Britain opted for a referendum. Indian Politicians do not have the guts to go for a referendum on issues of National importance as they know that there is a big disconnect between the masses and the Ruling Class ( Politicians and Government Officials). more  
Thanks to all I am virtually know what does mean how it influence on the world more than india thank you for information which is analytical in nature more  
Their is always misunderstanding between the voters and the ministers due to fund problem, as the public projects like Metro rail project which might be a central government project is getting delayed to the extend that the people are not able to reach the place in time. Their is always misunderstanding between the ministers and the officers in implementation matters. eg., the insurance policy given for the people who open account for gas connection is normally a minister's individual decision, in which government would face lot of financial problem. First people who don't take the amount should be given with the interest, people should not go in a wrong way for death claim insurance. If the Insurance policy type says that the interest to be credited in back will be moved to their LIC account, and at the age of 60, 100 days account openers should retire leaving the youths to get utilized with this scheme, and those people should be given this LIC policy amount during their retirement. If so their will be security for these people's life. more  
This is about Brexit. How does "compost" fit in? more  
Brexit will have some impact on UK, but may not affect India much. more  
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