The EU Referendum was by any sane standards one of the naivest, most bizarre and arguably vaguest questions ever put to the British electorate. One that appeared to provoke an emotional response, not one based on facts, logic or reason. No one – certainly not Cameron, Johnson or Farage – actually believed the British Public would be ballsy enough, or as some would argue, stupid enough, to actually vote to leave the EU.
It goes against all perceived wisdom for people to vote for the unknown.Indeed, it is well known that on the whole, people fear change and an uncertain future – and let’s be frank, that is what a vote for Brexit was. There was no clear vision put to us by ANY of the Brexiteers as to what a post EU Britain would actually look like. Aside from a few empty promises hastily pasted onto campaign buses, the Leave campaign had no specific manifesto. How could they? They were not actually a party, more a patchwork, cultural collective, headed up by a ragbag of cross party politicians.This was without doubt an unholy alliance.
In one corner, you had pro-democracy campaigners who disagreed with the undemocratic institutions that have blossomed within the EU, highlighting the immense power they wield over our daily lives. There were genuine concerns, particularly over the proposed transatlantic trade agreement (TTIP), which would have escalated the rights of corporations over all members of the EU trade block and its citizens.
Then, in the far right corner, you had the out and out racists, who blamed our membership of the EU for the increases to net immigration into the UK. That is not to say that anyone who expresses concerns over immigration should be branded a racist, but some were and this became apparent in the racially motivated incidents that immediately followed the Referendum result.
When it came to doing business post Brexit with the EU trade block, they guilelessly believed they could have their cake AND eat it.
The final result was, without doubt, a seismic shock.Not just to the UK and the EU, but to the whole world. How could we have done such an utterly senseless, maddening thing? Even those who voted to leave were consumed with dread. One only had to observe the panic stricken face of Boris Johnson on that surreal Friday morning after the votes had been counted. He unwittingly provided a perfect ashen visage to symbolise the nations dazed and confused feelings.
Then, to add to this malaise, Cameron decided to renege on his promise of remaining PM “whatever the result” and threw his toys completely out the pram. Whether it was born of arrogance or utter stupidly, it turned out the Government who had promised a referendum within their election manifesto, only had plans in place for one of the two possible outcomes resulting from such a vote!
On top of this, the opposition began tearing lumps out of itself, as the shadow cabinet used the post Referendum fury, as an opportunity to launch a coup against their own leader. Not only do the Labour MP’s appear to be in an entirely different party than that of their own members, they are also stuck with a leader their own democratic rules prevent them from ousting!
And finally Farage, who arguably was the root cause of this whole fracas, attended his last European parliament in Brussels and addressed the gathered assembly to tell them what he’d been dying to tell them for the past 17 years. It was simultaneously both embarrassing and amusing!
So what of the future?
Should we panic? Perhaps not – well not yet at least. We are yet to see the financial Armageddon predicted by many. If you recall we had the International Monitory Fund, the Governor of the Bank of England, the majority of Economists, the then UK Chancellor, even President Obama! All of whom made clear in no uncertain terms that we should remain and that if we voted to Leave the EU, we would all suffer varying degrees of financial turbulence for many years to come, perhaps infinity and beyond!
The Leave campaign dismissed this as ‘Project Fear’, which became a surprisingly effective tagline, as any negative pronouncement or statistic could be conveniently filed away and easily dismissed. Indeed, some of the claims were so outlandish and overblown, they probably had the reverse impact on the final tally, so quite possibly an own goal on the part of the Remain campaign.
Well the markets wobbled a bit at first, but have since recovered well.Arguably the Eurostoxx have been hit much harder, particularly the Euro banking sector.
Sterling has certainly been punished, particularly against the dollar, but time will tell how all these currencies will play out. Certainly the Euro’s problems are far from over, so it is very tough to predict and hard to be convinced by any speculation. Not actually being within the Euro currency itself has certainly made our disentanglement easier to manage. Imagine the chaos that would engulf the EU economy in the event of a Frexit! This is of course why contagion is a concern, not just to our European friends, but for us also. A financially unstable Europe would be a true economic/social disaster and not an outcome any of us should wish for (even those in the far right corner of the ring!).
Commercial Property appears to be the worst hit sector. Jeff Matsu, RICS senior economist, said: "Political and economic uncertainty in the aftermath of the referendum result has clearly dampened sentiment in the commercial property market, with the tone becoming visibly more cautious right across the UK. Although the impact is widespread, the drop in confidence has been most pronounced in London.”
The UK housing market is harder to predict and headlines vary daily on this.The fact that sterling is down has made it more attractive to foreign investors, but the domestic market is suffering from a temporary confidence deficit.The issue is of course purely psychological, as the structural problems within this sector still remain. So unless a massive housebuilding initiative is implemented to increase supply of housing stock any time soon, it is not likely that any downturn will remain for long.
If we juxtapose this with what we have seen over the last decade, in which we have been first hand witnesses to the world’s biggest financial meltdown in recorded history. A banking crisis of almost immeasurable proportions, followed by a prolonged recession. Yet despite this perilous backdrop, none of it has had any lasting impact on UK property prices, in fact quite the opposite:
One therefore has to question how the UK’s vote to leave the EU could really have any lasting impact on the housing sector and property prices.
When it comes to trade, it is clear that the EU will not make a new deal with the UK that does include ‘free movement of people’ within it, so it was an impressive move by the new PM, Theresa May, to appoint three key Brexiteers to head up these negotiations. She is of course acutely aware that they will have to sell a compromised trade deal back to us, meaning one that will undoubtedly involve free movement of people – at which point many will begin to wonder what the referendum was actually for!
On the other side of the argument, supporters of Brexit remain upbeat, claiming the UK will no longer be constrained by the vested interests of a 28-member trading block. This, they argue, will enable the UK to be nimbler on its feet and more able to agree trade deals with the likes of India, Australia and Canada, without textile, tomatoes or feta cheese, becoming deal breakers!
Whilst the decision to leave the EU has been made from a democratic standpoint, the actual process is likely to be a long drawn out affair, so much so we will almost forget the hysteria we all felt that surreal Friday morning in June. So, despite Jean-Claude Juncker, who like a bitter ex-spouse, was initially demanding we clear our things and go, the process itself is far more bureaucratic and tedious.
Before invoking article 50, an act of parliament is apparently required in order formally to approve the decision and initiate the process, so there will be more fireworks to come over this. Gregor Irwin, a former UK Foreign Office chief economist, says Brexit will be “a protracted process, lasting around 10 years”. Mind you, Irwin wrote this for an article for Lord Mandelson’s pro EU consultancy firm ‘Global Council’, so a pinch or two of salt should be added, for his pessimism is more a ‘position’ than an independent assessment.
So yes, sooner or later, we shall be decoupled from the EU train and set adrift to begin charting our own course. Where this will take us is not yet clear. Whether it is a good thing or a bad thing, will for some time to come, be hotly debated in pubs and kitchens across the UK. But one thing is clear – a decision has been made and it is a decision we must now accept, work with and build on. Let's not forget the UK’s stoic resilience in the face of adversity and its capacity for rising to challenges, as displayed so perfectly when we hosted the 2012 Olympics.
So yes, ‘keep calm and carry on’ we must, for if history is anything to go by, it will all work out – we’ll make damn sure of that!