‘Brexit’ threat could do serious damage and needs our full attention

With the election under way we can expect the minds and energies of our political leaders to be focused elsewhere for the next month or so. However, the world doesn’t stop when the posters go up.

Neither, to be fair, does the Government or administrative policy making, but it slows.

In the context of Britain’s referendum on whether or not to leave the EU, widely known as ‘Brexit’, this may be problematic.

The vote on Brexit looms large and it will will be enormously problematic. 

Part of the problem will be around what will happen when all the pieces stop moving.

The risks include those that can be quantified, and uncertainty, which by definition, cannot be quantified.

The plan by UK Prime Minister David Cameron, in so far as it can be ascertained, is to obtain from the EU the maximum amount of real reforms or concessions that can be presented to the UK voters and which can be put through with the minimum amount of trouble. 

This in essence limits the material he can work with as no EU leader will want to go near a treaty change that requires their own referendum or even a parliamentary vote.

His problem is that literally nothing he brings home will satisfy those who favour Britain getting out of the EU.

Having pushed and goaded the UK to the brink of what was politically unthinkable why would the UK eurosceptics stop now? 

No logic, no evidence, will appeal to emotions which are running at a high temperature.

The draft outline deal that was agreed in recent days has not it appears won over a majority of UK voters, with a new poll showing an increase in support for Brexit amid dissatisfaction with the draft deal. 

What should be of greater concern is not that there is a majority of those polled in the UK that there is also the very real prospect that Brexit could lead to the breakup of the UK.

While a majority in England may want at this stage — it appears — to leave the EU, Scotland it is suggested is very solidly in favour of staying in. 

The UK leaving the EU cannot be pushed down the throats of the SNP.

What of Northern Ireland? 

Polling on the issue seems scant. The most recent poll conducted late last year suggests that a majority of voters in the North want to stay in.

Would the North stay in the UK if the Scots leave? 

The dilemma facing unionists would be hideous, while one can imagine the nationalist parties rejoicing.

Could England, dominated by a determinedly Tory isolationist economic ideology that would not be out of place in the early years of Queen Victoria, continue to support Scotland and the North to the extent that it has done?

While an independent Scotland could well thrive, the same is not as clear for any putative independent Northern Ireland. 

Depending on who you ask the annual subvention to the Assembly is as much as €13 billion a year.

That’s up to four times the total raised from the USC tax.

In the making of the deal between the UK and the EU there is confusion and tentativeness when bold and clear positions need to be set. 

The main planks of the plan are twofold, from an economic perspective.

First, there would be potential for the UK to declare an emergency and to restrict the rights of EU migrants to in-work benefits, for up to four years.

Second, there is a proposal for a two tier bank approach across the EU.

Both of these proposals could and should worry Ireland. There are approximately 400,000 Irish citizens in the UK. 

Are we really happy to see a situation whereby Irish working citizens receive fewer benefits than their otherwise identical UK counterpart?

Even if some deal were cobbled together, how could that deal be accepted by the Polish and Lithuanian governments? 

Like it or not we are in this together and if we do not hang together for workers’ rights we will hang separately. 

One of our largest banks, Bank of Ireland obtains a large part of its profits from the UK.

Overall the Brexit juggernaut rolls onward. We cannot afford to take our eye off the potential for it to do serious damage.

Brian Lucey is professor of finance at the School of Business, Trinity College Dublin.


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