Query: Why Britain separated from EU? What are its implications on – Britain, EU, and on India.
I submit my views.
Summary:
Britain is already on a downward slide. By exiting from European Union, it has hastened its fall. It is a non-event for rest of the world. Unless…the Britishers wake up and put their act together.
There is nothing unique in Britain’s tendency to bring harm upon itself. India has done it repeatedly. US is doing it right now very seriously.
1. Details.
History is Process Driven :
In studying human history, we tend to look at events. This is micro view. It would be better to look at the whole process that has resulted into the event; and then see:
(i) What caused the event;
(ii) If the process continues, what can be the consequences; and
(iii) If the process stops or reverses itself, what can be the consequences.
For this we also have to consider the human psychology, and the laws of philosophy. Realise that the process itself consists of several cycles – some virtuous cycles and some vicious cycles. The cycles keep changing in several manners – speed, intensity, direction etc. The interaction of all these cycles produces several events. We notice some.
This may be the practical Macro view, encompassing more than what the economists call a “Macro View”.
2. The British Process of Exit:
2.1 The Britishers left EU because, they still believe – majority still believes – that they are superior to rest of the world. (This is a universal human weakness). And their currency – Pound sterling is the best currency. They cannot be subordinate to anyone. EU was perceived as – making them lose their sovereignty and hence unacceptable. This was the first cause.
2.2 British economy is downhill. There is unemployment. The American economic crisis of the year 2008, has only exacerbated the British economic crisis. All the supply of additional money (Bail outs & Quantitative Easing) has not lifted the economy. People who are unemployed are dissatisfied with their own Government; EU Government and with many other causes that they can identify. After changing the British Governments, economy has not improved. So what do you do? Can’t change EU Government. So leave EU.
2.3 The U.K. current account deficit at 7% is an all-time high. With Brexit this deficit is likely to increase. This will devalue the sterling pound further. However, some believe it is good for Britain. Hence leave EU.
2.4 Despite the fact that British economy is down, the perception of majority of Britishers is that EU is dysfunctional and is a sinking ship. So leave EU.
2.5 The EU policy is that any citizen of EU can move anywhere within EU and can settle down anywhere that he likes. People from Eastern Europe and many countries where economy is far worse than in UK, did migrate into the UK and started working there for a lower pay. This was perceived as causing unemployment amongst the Britishers. This perception ignored the fact that many Britishers live in EU.
2.6 The Syrian refugee crisis exacerbated the fear of unemployment. Sheer number of refugees, and the fact that almost all of them were Muslims, made them unacceptable. And then media publicized news that the refugees were raping European women, terrorists enter Europe with refugees etc. These are big reasons for making refugees unacceptable. But refugees cannot be prevented from entering Britain as long as Britain is part of EU. So leave EU.
Remember the year 1971 when more than a crore of Bangladeshi refugees came into India. Western World advised India to accept them on humanitarian grounds. The refugees are still in India. At Wadala – Antop Hill, there is a whole area known as Bangladeshi Colony. This is just one of the areas spread all over India.
Also note that the USA – which is at the root of the Syrian crisis is not affected by the refugee crisis.
2.7 Then came a sheer coincidence. Cameron made a promise in his election campaign that he will call for a referendum – ‘whether UK should continue in the EU or not’. Having made the promise, when he won election, he was duty bound to call for the referendum. Cameron himself believed that UK should continue with the EU. He had made the promise just to get more votes. If no referendum was called, there would be no exit. But the referendum was called and there is BREXIT.
There were people who were dissatisfied with the EU for psychological reasons. Economics & Geopolitics were not on their mind. They seized the opportunity, canvassed heavily for exit. Most Britishers do not understand Global politics & economics. They only know whether they or their close ones have lost their jobs. People canvassing for Brexit also did not expect a win. When they won the referendum, they were shocked and went in the background.
3. Impact:
3.1 “United we stand & divided we fall” is understood by all. However, this is practised by few. European Union together is the largest economy. It can influence global politics and even challenge US influence. When one unit out of the Union separates, the strength of the Union certainly goes down. Hence, to that extent EU will suffer. To that extent, US might be happy.
3.2 Culturally and psychologically, Britain and Europe have always considered themselves separate and different. British ego increased and sharpened that separation.
However, the irony is that Britain is seeking to delay the exit whereas EU is working for an early exit.
3.3 Also, Britain has no strong leader. It is not in a position to impact world sentiment, leave aside world economics and politics. Its own economy is in doldrums. By exiting EU, worst sufferer will be UK. Pound sterling has already lost 10% of its value since the exit vote making import of raw materials and consumables expensive. This increases both the cost of production and cost of living – impacting industry, jobs and the common Britisher. Scotland and Ireland are reviewing their relationship with Britain.
3.4 If we consider the theory of “Butterfly Effect”, everything affects everything. There will be some impact on India as our exports to UK will become expensive. But the impact will be so small that does not merit discussion. Because of Brexit Netherlands, one of EU’s founding members will call for a UK like referendum and Hungary’s forthcoming October referendum will be on EU migrant policy. Mr. Geert Wilders leader of the Party for Freedom of Netherlands in the party’s manifesto has pledged to withdraw from EU. As opposed to this Germany is working for ?better Europe’ and not `more Europe’. Despite these developments E.U. will still be the second largest economy. Hence I am of the opinion that there will be little impact on world economy.
4. Principles of analysis :
Considering an event and then trying to project future events and consequences – amounts to ignoring an important principle of analysis. Human beings are an important cause of all the cycles and the total process. After the event, they are not going to sleep. They will act. How they will act will affect the cycles and hence future course of events. How humans will act in future is a difficult matter to project and I cannot cover it in this brief article. Hence my view: Future was always unpredictable, and will remain unpredictable and
‘Brexit is a non-event’.
