The Economics of Brexit

I am not an economist but simply listen to economists as they make their analyses and predictions. I do this because they are widely reported and hardly a day goes by without some learned person making some kind of prediction about our future prosperity.

Take Brexit, for instance. We are constantly being told that a no deal Brexit would be catastrophic for our economy (and all sorts of other things). The Siren voices drown the voices of those who argue that a no deal Brexit would not be a catastrophe, but an opportunity.

We have to consider self interest; democracy take into account the self interests of all the voters and comes up with a result. However self interest is affected by beliefs and beliefs are affected by propaganda and propaganda is a tool of the politically and economically powerful.

So most of the multi-national corporations oppose Brexit because they believe Brexit will produce conditions that will favour the smaller businesses and thus disadvantage the multi-nationals of the world. I think that they are right; Brexit will help smaller businesses mainly because they will have to put fewer resources into regulatory compliance after Brexit because there will be fewer regulations (apparently) after the UK has left the EU.

Employment law is a good example of what I mean. Our existing complexities of employment law are inspired by the continental concept that a job is an asset, like a house or a car, which belongs to the employee. There are thousands of regulations about all aspects of employment law and whether you have a large business (employing Human Relations staff) or you have a small business employing a handful of folk the regulations equally apply. The more regulations there are the more expensive it is for small business to comply. There are many other examples.

So when you hear of dire economic consequences of Brexit treat them with as slightly less attention as you would pay to the chap bearing a sandwich board stating the end of the world is nigh.

 

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