June 2, 2016    5 minute read

Brexit: To Leave Or Not To Leave?

   June 2, 2016    5 minute read

Brexit: To Leave Or Not To Leave?

As the voting day looms, it is critical to know exactly what is at stake. It is also of great importance to have facts, which are not polluted by political organisations, which do not necessarily want what is best for the country.

Immigration

This subject is obviously quite sensitive at the moment, and there is no doubt that the member states have not exactly dealt with the issue as well as they could have done. If Brexit occurs, we would not have this problem. Indeed, we would have no obligation to take on any of the EU refugees, and that would mean that the furthest the refugees would be able to go is Calais. On the other hand, if we do stay within the EU, then the issue would not change. At this moment, it may be appropriate to point out that this is an exceptional circumstance, the refugee crisis has not been going on for the past 20 years, or even 10 years, it is only very recent, and so needs to be taken as an exception. Professor Kahneman explains that we (as humans) take exception too much into account, when effectively they should actually be taken out of the statistics. So, if we were rational, we should not base our decision on any of what happened in the last year or so.

Free movement of workers

This has also been flagged up in mainstream media, most of the time in a negative way. When considering the facts, we have around 3 million UK workers that work in the EU, without the need for a visa or any other legal agreements. Looking at it on the other side, we have 1.73 million workers, which come from the EU that is a mixed between central and eastern Europe. Some would argue that this is too much, and so on. However, if I were someone that would argue that, I would refrain from doing so, and let me tell you why. The UK has 3 million workers, which come from outside of the EU. That’s nearly double the amount. If you think that having too many workers from the EU is an argument for leaving the EU, then following that opinion, we should close our borders to a lot more nations than just the EU.

Membership fee and Trade

The membership fee is estimated at around £9bn. However, this isn’t even a percent of the UK GDP, but the total cost per year of being in the EU is estimated at around £200bn. On the other hand, the UK receives around £470bn a year of foreign direct investment, thanks to the EU membership, thus, it could be argued that the UK makes money from being in the EU. Furthermore, 45% of UK exports are to the EU, while 50% of our imports are from the EU. The EU is an extremely powerful trading partner; it contributes to 25% of the global GDP. Now, you may have encountered a person that will say to you, ‘yes but we will be part of a free trade agreement with them anyway, look Switzerland can do it.’ We are not Switzerland, and we do not produce as much as Switzerland. These types of arguments need to stop, as they are just complete hypothecations. It would be idiotic to make a decision as important as this one, based on a speculation that we would be able to create free trade agreements with everyone. Both China, and the US have said that they are interested in having agreements with the EU, and that if the UK leave, then tough.

Legal

This is a subject that I particularly find interesting having studied EU law. The way that the EU constitution is written is a pain, and I would completely agree with anyone that would say that ‘the EU is a good idea, but it just doesn’t work that well’. I agree, the way that the EU is formatted, whether it is legally or politically, just doesn’t work as well as it should do. However, this is not the legal argument that is brought up by the leave camp. The argument that is brought up is ‘we are forced to pass EU laws, and we don’t agree with them most of the time…’, effectively they are saying ‘we want parliamentary sovereignty back’. Let me shed some lights on this issue. It is in fact correct that on some occasions we have to pass EU laws into our legal system, this is undeniably true. However, we only pass about 7% of EU laws every year. That also means that 93% of the laws that are passed, are the laws that our parliament decides to pass. Coming back to the parliamentary sovereignty issue, we have it 93% of the time.

Currencies

There is no doubt that if the leave camp wins, we are not going to be as financially stable as we are currently by being in the EU. Moody’s and the other rating agencies have already confirmed that by leaving the EU, they would downgrade our credit rating. This also means that we would not be as attractive to foreign investors, and also means that we would not be backed up by the ECB if anything were to go wrong in our economy.

To conclude, the voters need to make a decision based on facts. Most of the arguments for leaving the EU are either based on absolute speculation (like the free trade agreement one) or emotionally driven (like the parliamentary sovereignty one). The 23rd June is going to be a date that will not be forgotten whatever the scenario, but the decisions that people make must not be driven by emotions, and must be factual.

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