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The Brexit Thread

BigT said:
There’s a lot of crystal ball owners on here today, any chance of tonight’s lottery numbers?
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What are you referring to? The claims that Brexit will be damaging to the economy? That it will be more damaging than Covid?

No crystal ball required. There is plenty of data available.

For starters, the government's own analysis which forecasts that a no-deal Brexit would reduce UK GDP by 7.6% after 15 years, while reaching a free trade agreement (FTA) with the EU would lead to a 4.9% decline.

LSE also did research which shows that Brexit will be more damaging than Covid. This is because although Covid has a sharp shock, there will be a recovery. However a Brexit, especially a no deal Brexit, will cause a reduction in GDP that will persist over a much longer time. In 15 years time there will have been more damage caused by Brexit than by Covid. Two to three times more, in fact.

Sampson-2.png

Notes: Covid-19 shock is the same as in Figure 1. The long-run effects of FTA and No deal Brexit on GDP are taken from HM Government’s ‘EU Exit: Long Term Economic Analysis’ paper using the central estimates. The Brexit shocks are assumed to phase in linearly over 15 years.

Sampson-3.png

Notes: Author’s calculations of the present discounted value of the real GDP paths shown in Figure 2 relative to a baseline where real GDP is constant over time. Future GDP is discounted assuming the annualised real interest rate equals 4%
 
We could all find graphs but frankly it’s absurd, nobody knows what’s going to happen hence the crystal ball comment, it wasn’t specifically aimed at you but lots of comments about what’s going to happen.

Interestingly you focus on GDP and not the half a TRIlLION pounds that’s already been borrowed that has to be paid back.
 
BigT said:
Interestingly you focus on GDP and not the half a TRIlLION pounds that’s already been borrowed that has to be paid back.
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Why do you keep comparing Covid and Brexit? Covid was unavoidable (although the mishandling of it was but that's for the other topic), we have to spend to keep our heads above the water. Brexit and the subsequent mess of decisions that's followed is entirely of our own doing.
 
BigT said:
We could all find graphs but frankly it’s absurd, nobody knows what’s going to happen hence the crystal ball comment, it wasn’t specifically aimed at you but lots of comments about what’s going to happen.

Interestingly you focus on GDP and not the half a TRIlLION pounds that’s already been borrowed that has to be paid back.
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Nobody is saying they know what’s going to happen, but the risks being taken bring zero benefit to this country. All the so called benefits of a no deal brexit have been proven false (as already mentioned none of the trade deals we have agreed exceed anything the EU managed to get).

Why take such a risk over it? The trade deal we did with Japan forces the UK to make certain law changes and insist on certain policy directions, why are we ok with Japan eating into the mystical sovereignty but not the EU? All trade deals do this, I don’t understand why this is coming as a shock to people?
 
Funcone said:
I do agree that Brexit might not be as bad as some people think it's going to be. That's hardly a ringing endorsement though. They didn't put that on the side of a bus, did they? "Vote for Brexit, it might not be as bad as some people think it's going to be".
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I think it was the promise to give the NHS a large chunk of the EU membership payment.

Then the morning after the win. Went back on it.


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delta79 said:
I think it was the promise to give the NHS a large chunk of the EU membership payment.

Then the morning after the win. Went back on it.


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Apparently, some people justified that claim by saying the money spent on the EU could hypothetically be spent on the NHS, not that it definitely would be. Even when the slogan was plastered all over that bus...I don’t buy that explanation. I really don’t. It just sounds like back-pedalling to justify lies.
 
Jonathan said:
Apparently, some people justified that claim by saying the money spent on the EU could hypothetically be spent on the NHS, not that it definitely would be. Even when the slogan was plastered all over that bus...I don’t buy that explanation. I really don’t. It just sounds like back-pedalling to justify lies.
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It's far simpler than that. Anything that Vote Leave said about what would happen if they won was entirely hypothetical and designed to be vacuous. They weren't the government, seeking to govern or even a political party with a manifesto, they were just a campaign with a single aim. The government and the opposition were on the other side, after all!

In order to win the EU referendum, Vote Leave rightly identified that they would need Labour voters to do so. Historically, the issue Labour voters most care about is the NHS and that's why it was chosen.

Vote Leave used a number of tactics from the Yes campaign in the 2014 Scotland referendum and redeployed them (more effectively). The NHS was weaponised there too, "The NHS is on the line - wholesale privatisation of the NHS is a very real prospect" .... that's the fully devolved NHS, of course :)
 
Craig said:
Why do you keep comparing Covid and Brexit?
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I don’t, there is no comparison, if we are talking global turmoil Brexit is the equivalent of a pimple on your backside in terms of inconvenience compared to COVID.

It might surprise you to know but I didn’t even vote for Brexit, I work for a German company so it would of been like turkeys voting for Christmas, however since it happened anyway we have had to plan for it, we ship parts, equipment and people all of the time over the border normally on a just in time or emergency basis, it hasn’t been easy but it’s just a case of stockpiling the correct things in preparation for expected delays that may or may not happen.
 
BigT said:
I don’t, there is no comparison, if we are talking global turmoil Brexit is the equivalent of a pimple on your backside in terms of inconvenience compared to COVID.

It might surprise you to know but I didn’t even vote for Brexit, I work for a German company so it would of been like turkeys voting for Christmas, however since it happened anyway we have had to plan for it, we ship parts, equipment and people all of the time over the border normally on a just in time or emergency basis, it hasn’t been easy but it’s just a case of stockpiling the correct things in preparation for expected delays that may or may not happen.
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I’m shocked I tell thee that a global pandemic has a bigger impact on the global economy than a small country leaving a customs union! I would if I lived in Australia or America care little about brexit but as we do live on this little island I think brexit has a lot of relevance.

Im going to assume your German company is not dealing in perishable items? And how much is it costing to stockpile the required items and is that cost being passed onto the consumer?
 
Dave said:
I’m shocked I tell thee that a global pandemic has a bigger impact on the global economy than a small country leaving a customs union! I would if I lived in Australia or America care little about brexit but as we do live on this little island I think brexit has a lot of relevance.

Im going to assume your German company is not dealing in perishable items? And how much is it costing to stockpile the required items and is that cost being passed onto the consumer?
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No they aren’t perishable as almost all goods that move over the border aren’t.
They are machines and parts for food processing machines so I do know a thing or two about perishable goods and the food supply industry.
The cost is millions but no the cost doesn’t get passed on, in fact it’s a saving for the customer as shipping cost is lower.
 
BigT said:
No they aren’t perishable as almost all goods that move over the border aren’t.
They are machines and parts for food processing machines so I do know a thing or two about perishable goods and the food supply industry.
The cost is millions but no the cost doesn’t get passed on, in fact it’s a saving for the customer as shipping cost is lower.
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Except for late summer more than 70% of fresh food is imported. If it doesn’t cross the border how else is it getting here? Teleportation?

I mean the entire food industry is stressed about the flow of perishable goods, and all have said prices will go up in the event of no deal. What assessment are you using to repute their conclusion?
 
Dave said:
Except for late summer more than 70% of fresh food is imported. If it doesn’t cross the border how else is it getting here? Teleportation?

I mean the entire food industry is stressed about the flow of perishable goods, and all have said prices will go up in the event of no deal. What assessment are you using to repute their conclusion?
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I’d love to know where you get those figures as they are complete fiction, 70% of fresh produce imported in late summer? What right in the middle of the main UK harvest season you mean?
You must give us your wealth of experience in the industry because whilst there is tension in the industry it’s more to do with cheap labour supply than anything else.
 
Brexit is no longer a standalone issue. It is very much intertwined with global affect of the pandemic.
We are now stuck in a endless loop of protectionism. Each side want the best deal for them. And i can clearly see we will end up trading with the EU under WTO rules with a few item deals are done.

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