Explain the impact of Brexit to a clueless American

[Elok]

I don't want to distract from the main Brexit thread where people who know WTF this is about are talking.

So, I get the basic argument against staying in the EU: they're a bunch of unelected arrogant bureaucrats, etc. What I don't understand is how this will affect things. This is rooted in my basic failure to understand just what the EU does. There's no EU army or anything, and while they have a pan-European currency the UK wasn't in that anyway. I understand that there are a lot of regulations involved in being in the EU, covering everything from immigration and tariffs to agriculture and industry. Is the concern simply that the loss of all those rules would screw up the economy, say by raising tariffs on goods entering and exiting the UK? Or is it that this will trigger a general stampede for the exit?

[OneFootInTheGrave]

The impact will be worked out, so that is in progress.

The three main types of "Brexit" ie the following, but it all needs to be agreed.

So basically, they could remain in the single market, without the right to vote on decisions (remain part of EEA, like Norway), make bilateral treaties with each EU country individually like Switzerland, or completely exit and deal with EU like US or China. Dependable on what kind of shape the exit takes, that will determine the amount of "fallout". EEA is basically - nothing, all stays the same, except paradoxically UK loses some sovereignty, at least short term, until they try to renegotiate the position further.

Odd are on that EEA type of arrangement will be made, EU President was threatening last week, that this will not be allowed ( - bunch of low life sellout Brussels politicians), but regardless of the threats, this is the most likely outcome, as it is by far the least disruptive to both entities and to the banking system, economy in general and so on.

More details require a longer discussion on what EU really is, and how it currently functions.

Other than that Brexit will make it easier for other countries to leave later, and there are plenty of good reasons to do so, while the EU is governed as it currently is, so this vote is a win-win for all. For UK as it regains some sovereignty back (definitely over the long term, even with EEA exit type), can be governed better by the elected national government, while EU will need to take one final hard look on itself, decide to reform in earnest or admit defeat and collapse totally.

Overall the choice is great, better to deal with the reality now, than later when the next 2008 comes around.

[OneFootInTheGrave]

To add - EU was setup as a very poor compromise, where the expectation was that a crisis is needed in order to be setup "correctly".

Crisis happened, nothing changed, here we are. Brexit is a gift to both UK and EU to put their **** together and reform.

Either way UK is going to be shielding itself from eventual EU implosion (as the likelihood of EU beaurocrats "doing the right thing" is maybe just a little bit better than for the Soviet ones - so very, very small) , and one can only hope that EU will react to this as well in a positive way, change the way it is governed. Chances are slim, but better now, still in relatively good shape, than after a crisis which will completely break it economically (when the whole continent will look like Greece or maybe not that bad, but like Spain and Portugal).

[Ben Kenobi]

Yeah, I can't see Britain leaving the EEC. The biggest impact will be the migration - the border controls will be back again.

[BeBMan]

I don't want to distract from the main Brexit thread where people who know WTF this is about are talking.

So, I get the basic argument against staying in the EU: they're a bunch of unelected arrogant bureaucrats, etc. What I don't understand is how this will affect things.

Noone really does at this point, there are various hopes as well as concerns but after all these are scenarios floating around, but what will happen exactly and how it affects anything just remains to be seen.

This is rooted in my basic failure to understand just what the EU does. There's no EU army or anything, and while they have a pan-European currency the UK wasn't in that anyway. I understand that there are a lot of regulations involved in being in the EU, covering everything from immigration and tariffs to agriculture and industry. Is the concern simply that the loss of all those rules would screw up the economy, say by raising tariffs on goods entering and exiting the UK? Or is it that this will trigger a general stampede for the exit?

The first concern is short-term uncertainty. What happens long-term depends on what's actually being negotiated, so which scenario materializes.

Economically the UK could run into further problems when they leave the common market. As noted they can seek to stay in there (despite having left the EU, like others do which are not EU members), but that would mean they still have to abide to rules and regulations related to it.

The other side is whether and how it will change the EU itself, and whether and how Europe will sort out its own problems (and whether this will mean it will be less able to react to problems around it).

[Bereta_Eder]

In two words,

Europe got tired of always pludging into wars and being the smakc boy of the US or the USSR.

So it decided to unite and live by true socialist principles.

Those principles got lost, the system was scewed, Germany became unrealistic and instead of the EU creating prosperity security and harmony it embraced a barbaric neoliberal model of free markets which means that it betrayed itself.

It started attacking Russia, stealing people, suppressing democracies, turning into a veritable cluttered dictatorship.

So now it ends

[Bereta_Eder]

What the brexit means is that the first cousins of the europeans are now completely free to enact unrestrained national law and wide exposed to the tiniest "punitive" action by the EU from tarrifs to immigration.


What that means NOW, is that the UK is excluded from all common european councils. (can't vote in favor of russia sanctions for example)

That's about it, nothing more.

It has to start enacting national law that diverges from unitarian one. And there is no "punitive" actions yet

(like flodding it with immigrans by just opening up calais for example - which it can't sink )

[Bereta_Eder]

How this affects things is this:

there was a sense of unavoidability of progress of the european project.

Meaning that furthering unification was never challenged.

That changed with Greece possibly leav ing the eurozone and it burst like a 200 kg piano now that the UK left the EU itself.

This sense of unavoidability was something akin (since I'm talikng to elok) as the second coming.

Now, it's like someone saying maybe it won't happen...

[Bereta_Eder]

there are 4 pillars of the EU as envisioned in the maastricht treaty (which was rejected and rejected untill they voted right)

freedom of movement of
capital
people
goods
services

on a paneuropean level.

that's the basis of the single market that is an ever going project being implemented with some completely illogical fashion now.

the UK is no longer part of the EU.
that means that it has no free movement of goods, people, services or capital.


it is an island (damn I'm so smartchie)

Now what bebro says, is that there are countries which are not in the EU BUT in order to enjoy a portion of this freedom of movement have accepted to adopt part of the unitarian law (that's community law, enacted by the commission, ratified by 28 member states and automatically transpositioned to national law of each and every member)

So perhaps a similar deal could be struck with the UK.

What that means on the wider scheme of things is that now everyone from captain america to his grandmother are demanding a referendum.

Seeing as the shortcomings of the EU and the neoliberal model have produced anger, far right wing groups and have basically shattered whatever resemblance of european identity was left,

those referendums will be yes to leave, if they are allowed to take place

[Bereta_Eder]

The consequences for the UK are porentially devastating.

Its geopolitical stature has dramatically lowered overnight.

Spain is demanding gibraltar.

Scots want out (again)

the irish are not too adverse to have another referendum for a united irland (that may piss some protestants)
And is amazingly vulnerble to trade wars with the biggest commerical block on the planet.

Many of these threats will not be materialized but they will stay on the table and be used, in time

[Bereta_Eder]

in short terms,
firms that use it as manufacturing base for exporting to the EU will leave. (no free access to the EU anymore) That will cost hundrends of thousand of jobs
city will be destroyed.
the pound will plumet
and it risks fracturing itself as a national entity.

but then there will be a new equilibrium

[OneFootInTheGrave]

Yes, but UK can leave and still be a part of the single market - this is the most likely choice - remain a part of EEA, European Economic Area, together with Norway.

This way they are formally out, but get the decisions made in Brussels without their presence. However the positive side of this is that they can try to buy the time within EEA type framework, and further renegotiate the position over time. Norway did not do exactly badly as an EEA country.

EU bureaucrats are afraid for their influence, as someone for the first time in decades sent an emphatic "no" to them, that they cannot do anything about. If they could crush UK like they did Greece, they surely would, and Juncker just threw a fit earlier today.

Great to see

[Dauphin]

The problem with anyone using the Norway and Switzerland examples to try and gauge what will happen miss that they are both resource based economies. Norway oil and Switzerland Nazi gold^TM.

[Bereta_Eder]

Although the greek system could, em, use some finetuning, it is true that all the (clowns really) that supported the brexit and won made special mention to Greece and the way its democracy was treated as the last drop on the bucket

As a further note, the evaluation of the greek program was magically concluded and 7,5 billion euros are in the greek coffers (to be given back)

I guess averting another greek crisis wasn't enough to avert a brexit

[Bereta_Eder]

and about norway I'm afraid it's true, the only thing they lack is the turbans