Last Thursday we witnessed something that will forever change the course of history. Something that has been and still is a major topic on every news channel. More so than the terror attacks in Istanbul yesterday (which Ill get to in a separate post). The phenomenon #Brexit.
What is it?
A vote (referendum) the United Kingdom held on whether or not to stay in the European Union. The result, at least in my opinion, devastating. The vote swayed towards “Yes, we want out” as votes were being counted, albeit the margin being very thin. 48.1% (ca. 16 million votes) voted to “stay” and 51.9% (ca. 17.5 million votes) voted “leave”.
In a country with a population of nearly 65 million, a turnout on this hot topic of only roughly 33.5 million (ca. 51%), again shows how important it is to participate in democratic elections. Something we in the western world take for very granted.
Why does it matter?
The long-term impacts of leaving the European Union in regards to economic costs and the shift of the UK in it’s affiliation with the remainder of the EU may currently be difficult to sort out, however the current impact this exit has is mind boggling. Something I cant comprehend, because to me it’s simple common sense. Investors and business leaders will have to rethink a lot of their strategies especially in times like these where nearly every where we look we face slow economic growth in a glass-like world aside from the tremendous political risks this exit brings for the UK, Europe and the global markets.
UK: the UK’s political establishment will now face a period of political and policy uncertainty as it negotiates both internally and externally on their new relationships with the rest of the world. Scotland looking to seek independence and join the EU and Northern Ireland to merge with its southern countrymen. Even London throwing out the idea of wanting Mayor Sadiq Khan to declare Independence from England.
Europe: From what Ive been following, Europe is right on the corner of finally being back to where it should be going. OVerall market sentiments are better, productivity is generally on the rise and GDP growth has been improved significantly in the first quarter of the year. Looking across the EU, the prediction was roughly 1.5% growth! This comes after years of challenges including the world financial crisis, the banking problems, Greece and the threat of their exit, nationalism, terrorism and refugees trying to reach the Schengen-zone. The exit of the UK has now caused an existential crisis for the EU.
The Globe: The global economy as a whole, from the way I perceive it is meandering and lacking growth. The IMF (International Monetary Fund) described the global economic situation as “ever-slowing and increasingly fragile.” The OECD (Organisation for Economic Co-operation and Development) noted that the economy on a global scale is “stuck in a low-growth trap.” Both organizations expect global output to increase just 3.1% in 2016. The same as last year. The World Bank is even more critical then that. Now, everyone is talking US and China and how they contribute to the engines of the global economy, but questions on the sustainability of growth in both countries continuously arise – including, commodity prices, inflation, interest rates, etc.
How does this tie into the UK leaving the EU? The UK accounts for roughly 2.3% of the world GDP. Its a major financial and business hub. The destabilization of one of the worlds reserve currencies, the impact on the stabilization of Europe and the trajectory of the global economy. These various factors will again cause volatility to the market which could derail growth yet again.
My 2 Cents
I did not want to go into very specific depth of the #Brexit above, just wanted to outline a bit of what is happening with a dash of my thoughts included. It’s all over the news and every media resource. Go read, because knowledge is power.
My take on this is that on a personal level I am very disappointed with this result! Here’s why:
My family has roots, literally current generation that range across the globe from the United States to Turkey, from Taiwan to Romania. I myself am a citizen of Austria but I am a proud pro-european! I believe that together is better than going at it alone. Two brains are better then one. Cultures, languages and people uniting in a combined cause is always stronger, better and eventually more productive then fighting at it on our own.
Now, just like any other country or business, the EU has become a very bureaucratic machine and although I do not agree with everything Brussels implements, the majority of what we as Europeans are and do today is due to the relentless thinking of uniting Europe. This goes from the Treaty of Rome (the founding days) all the way through the Schengen agreement, the Schengen convention, and so forth.
As a citizen of Europe, I am allowed to move freely, work and play my part across the EU on a majority scale, without the hassle of visas, various forms of documentation, etc. I have the privilege to travel, get to know people, cultures, heritage and ways of life without boundaries. As a European citizen I know that what I want for the people of Austria, the same is valid for all EU states regarding human and legal rights. The harmony across the EU to promote peace and international cooperation makes us more aware of how united we are stronger. The economic benefits of free trade for businesses, removal of non-tariff barriers allow businesses to grow, reduce costs and prices for consumers creates jobs and higher income. The EU is one of the strongest economic areas of the world, as a block.
All of these things are things that I, as a pro-European take for granted and utilize. The fact that I can start a business anywhere. I have a huge market. I can access jobs anywhere. I have access to healthcare, to various forms of benefits from economic to social. This is what I want all Europeans to understand.
The problem we face today is that the world is more selfish. It is all about “I” and “my own.” Right-wing mongers utilizing the notion of the financial crisis, the current influx of non-European immigrants and the fact that all our jobs will be gone and we will go back to the stone-age if we don’t become sovereign nations again. This is just wrong thinking.
Yes, we have a shitload of problems we need to deal with in Europe. Yes, Brussels has become bureaucratic and that needs to change, but it is us, the people who need to stand strong and voice what we want. And to me that want is not sovereignty. Going at it alone, closing borders and wearing blinders like horses is not the solution. Is it not easier to tackle a problem together as a family? These right-wing assholes that hold speeches and instill hate not only on immigrants and the financial crisis but against each other as Europeans is not what we have worked so hard for to remove. Taking our countries back is not going to make anything less better. We rely on each other when it comes to the economy, when it comes to jobs, and trading and business growth. We rely on each other for help and support in times of crisis.
The shitload of problems is what we need to tackle! Things like how do we support those less fortunate than us Europeans – the immigrants who leave all they have for something better. A majority of them or good people looking for a decent life just like you and me. Things like how can we ensure safety for the citizens of Europe from extremists. Extremists (of any religion by that matter) have nothing to do with Islam. Muslims are part of our community and looking to live a decent life just like you and me. Becoming a sovereign nation outside the European Union, to me is not a problem that is part of that shitload.
We need to come together. We need to support, collaborate, discuss and believe in one another. We need to widen our horizons and understanding of each other – our cultures, our heritage, our languages, our ways of life. We need to treat each other with decency and respect, utilize the fundamental values of what makes us human. We need to build on each other whether social or economic, provide healthcare and education for all. Allow all of us as Locke (later Jefferson) put it – the right to “life, liberty, and the pursuit of happiness.”
My ask to all of you Europeans reading this – do not be afraid, believe that together we can achieve more, united we are stronger than as individual nations. Be proud of your family, your country, your heritage and be proud to be European! Tell your representative of government what we as Europeans want!
Note: Please feel free to share this and comment below or on social media. This topic is dear to my heart and it involves a multitude of factors which would be to long to dispense all into a single written blog post. I hope that I was able to capture a snapshot of my thoughts on the topic that allows for reflection for you, the reader, as to where my thinking and justifications go.