Finance Finance News Five ways the UK may’ve shafted itself with Brexit

Five ways the UK may’ve shafted itself with Brexit

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Britain leaving the EU seems comparable to a man sawing off his own leg, gouging out an eye and tearing off an ear in an attempt to cure a toothache.

Friday’s vote is looking like an extreme and totally misguided attempt to solve a real problem.

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There are plenty of theories about what that real problem is – the effects of David Cameron’s austerity measures, the relentlessly insipid post-GFC economy, a general feeling of anger at the establishment, or just good old-fashioned xenophobia.

Whatever the cause of that disgruntlement, it is now clear the UK has almost certainly served itself a platter of more serious problems. Here are five of them.

british economy
Britain’s economy may return to GFC levels of strife. Photo: Getty

1. A buggered economy

The global financial crisis devastated Britain. Unemployment soared, wages stagnated, and life became a struggle.

The Bank of England, the UK’s central bank, played a major part in dealing with the problem. It slashed interest rates to an absurdly low 0.5 per cent (where they remain today) and pumped billions of pounds into the economy through ‘quantitative easing’.

Most economists agree this risky policy paid off. The UK is now one of the strongest economies in Europe. This year the Bank of England was gearing up to raise interest rates for the first time in eight years, which would have been a sign that Britain had finally recovered.

But on Friday the Bank’s governor Mark Carney said he’d probably have to do it all again – cut interest rates, more quantitative easing, whatever it took – to deal with the sure downturn, and likely recession that Brexit would bring.

After all that pain, Britain might be back to square one.

2. Eroded workers’ rights

For Brits who value workers’ rights, the decision to leave the EU will be a major blow.

The Trade Union Congress – the UK’s version of the ACTU – credits the EU with introducing a whole raft of workers’ rights, including rights for agency workers, working time limits, and rights for workers to be consulted on changes in their workplace that could affect their jobs.

british worker wind farm
British workers may lose legal protections. Photo: Getty

The EU also safeguards many of the measures already put in place by the UK. Leaving the EU would take away those safeguards, meaning a right-wing government would have a free hand to slash workers’ rights.

And unlike Australia, the UK’s trade unions are weak, and the workforce is fragmented and disorganised.

3. A poorly protected environment

Prior to joining the EU, Britain was known as the ‘dirty man of Europe’. According to Friends of the Earth, it had the highest sulphur dioxide emissions in Europe, and its seas were “akin to open sewers”.

EU membership made Britain subject to the strictest environmental standards in the world. These include water cleanliness standards, policies to protect the health of citizens and – most importantly, if you care about climate change – renewable energy and emissions targets.

If another ‘dirty man’ government had returned to the UK, the environment would have been protected under EU law. But no more.

4. An immigration conundrum

As soon as the EU referendum campaign began, it was clear it was a de facto vote on immigration.

northern ireland castle
The Northern Ireland peace process could crumble because of Brexit. Photo: Getty

Ironically, though, it is quite likely that, post-Brexit, the UK will remain open to EU citizens. If it wants to maintain its free trade privileges with the EU – and it most emphatically does – it would probably have to join the European Free Trade Association (EFTA), along with the likes of Norway and Switzerland.

But there’s a snag: EFTA’s deal with the EU secures the free movement of goods, services, capital, and … persons.

5. Jeopardising the Northern Ireland peace process

Of all the potential hideous outcomes of Brexit, the most tragic would be the destruction of the Northern Ireland peace process, and many are saying that’s exactly what will happen.

The border of Northern Ireland (part of the UK) and the Republic of Ireland is basically open. This openness is integral to the peace process that has been so successful over the past decade. But Brexit would mean tightening controls of the border, which could awaken all the old tensions. And that doesn’t bear thinking about.

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