Five Key Takeaways from Brexit

1 – The Brits take their sovereignty seriously
One of the most powerful messages of the Leave campaign was the assertion that British sovereignty was being usurped by the unelected and unaccountable bureaucrats of the EU Commission. Despite the presence of an EU Parliament with elected MEPs from member states, in reality this institution is merely a rubber stamp for the myriad of regulations issued by the European Commission controlled by 5 unelected Commissioners. These regulations are binding on EU member states and their growth and proliferation in recent years sees 60% of the legislative load of the UK Parliament devoted to the implementation of EU mandates. The increasing power of the European Court of Justice over ever widening categories of issues sees British courts more and more subject to review and veto by EU courts. Whilst Britain stayed out of the Euro, EU member states still must keep corporate and value added taxes (GST equivalent) and debt to GDP ratios within narrow bands to ensure EU wide conformity thus constraining some of the possible fiscal decisions by a Chancellor of the Exchequer (Minister of Finance equivalent).

This gradual surrender of the sovereignty of Britain’s courts and its Parliament had reached a tipping point. It must be remembered that Britain’s history differs markedly from the experiences of the other continental EU member states. Britain’s isolation as an island state and its military prowess over many centuries has meant it has not been subjected to a successful invasion in almost 1,000 years (since the Norman conquest of 1066). Britain (or England before Union in 1707) has gone it alone against the odds on a number of occasions: Henry V’s 6,000 soldiers defeating over 30,000 French knights at the Battle of Agincourt in 1416, the small English navy’s defeat of the massive Spanish Armada in 1588 at a time when Spain was the world’s only super power, victory in the Dutch wars of the late 1600’s, the battles that ended the expansionist conquering of Napoleon (Trafalgar in 1805 and Waterloo in 1815) and of course more recently defeating Nazi Germany in the Battle of Britain in 1940.

England pioneered many of the foundational institutions that now underpin all successful first world democratic nations. The power of the English crown was constrained as early as 1215 with the signing of the Magna Carta (the right to a fair trial, to face your accusers in court, to compensation for confiscated property and the need for the crown to consult before arbitrary taxation). The English Civil War wrested the power to tax from the Crown to an elected Parliament in the 1640’s. Through the centuries since the Middle Ages, the rule of law, the ability of courts to enforce contacts, to protect and legally transfer real and intellectual property and the establishment of an incorruptible, neutral and professional civil service that rose above partisan politics fueled the rapid rise of British driven international trade. This in turn brought great wealth sufficient to build the world’s largest navy to facilitate and protect the massive explosion of British global trade and it enabled Britain to lead the industrial revolution. These institutions and features, now taken for granted in any modern democratic capitalist economy, began in England and became part of the DNA of British life sometimes centuries before her rival powers did the same. For these reasons, the gradual abridgment of British sovereignty brought on by the growth in size and scope of the EU, has resonated more powerfully with the British voting public and led, more than any other single issue, to a vote to end this insidious trend so as to enable Britain’s Parliament (and the people who elect it) to chart their own destiny free from foreign interference in line with centuries of tradition. These are powerful and emotional almost visceral matters that transcend even the provable financial advantages cited by the Remain campaign.

2 – Elite opinion is mattering less
The unanimity of elite opinion in favour of Remain was staggering. British voters were told to vote Remain by:
• Most of the mainstream media (except a few of the tabloid newspapers);
• PM David Cameron (who staked his Premiership on the vote), half of the Tory Party, most of the Labour Party and all the Liberal Democrat and Scottish Nationalists Parties;
• Almost all economists and economic commentators;
• The IMF, the Bank of England Governor, the European Bank and if course the European Commission;
• A plethora of major British business leaders abetted by a number of big global financial institutions such as HSBC, Goldman Sachs and JP Morgan (all heavily represented in the City of London);
• A host of luminaries in academia, journalism, think tanks and former politicians such has former PMs Blair and Major;
• A large parade of media celebrities; and
• Various world leaders comprising Britain’s major trading partners including US President Obama, French President Hollande, German Chancellor Merkel, Canadian PM Trudeau, all the EU Premiers and even our own PM John Key.

The Leave campaign featured Nigel Farage, the demonised UKIP MEP, Tory MP and former mayor of London Boris Johnson and Tory Cabinet front bencher Michael Gove, a handful of centre right media such as the Daily Mail and Breitbart UK, a small minority of economists and little else. And yet despite the wall to wall clamouring of opinion leaders in politics, industry and entertainment and robust debates with claim and counterclaim, over 17 million people ignored the chattering classes who lectured and hectored, talked down to them and painted endless doomsday scenarios and voted with their hearts to leave.

A feature of the Brexit vote was the startling results from the Labour heartland in the Midlands and the North. The disconnect between elite, London based opinion and the fears of the working and middle classes in the heartland is most vividly demonstrated by this clip compiled by Guardian journalist John Harris. The Guardian is a mainstream leftist newspaper that favours the Labour Party and its causes and so gave prominence to the efforts of many senior Labour MPs on behalf of the Remain campaign. Watching this clip and the responses given to the earnest pleadings of the Stoke-on-Trent Labour MPs in an area that Remain needed to win, convinced me that Brexit was going to happen.

3 – Leftist social media aggression is not working
The progressive left uses Facebook, Twitter, Instagram and other social media to push their agenda – often very aggressively. Brexit supporters before the vote were routinely shouted down in the public square and told they were thick, racist and xenophobic. But middle of the road voters, anxious over the matters covered in my first point, just ignored the abuse and, as the abuse and volume of noise in favour of Remain grew, you got the feeling that the resolve of people in favour of Brexit increased to quietly exercise their democratic right as a way to silence the hectoring and smug preaching. Parties on the left have yet to learn that people who post on Twitter are not representative of, and are vastly outnumbered by, people not on Twitter who get out and vote.

This aggression can be no more plainly highlighted than the disgraceful efforts by some to tie the murder of Labour MP Jo Cox to the Leave campaign and then the petulant sulking of various high profile proponents of Remain since the results came in. Talk of Brexiters’ supposed remorse, the signing of petitions to have a redo, talk of depriving the middle aged and elderly of their vote because they turned out in higher numbers to bolster Leave than the younger Remain voters, support for Scottish MPs to attempt a veto, pathetic attempts to de-legitimise the vote by claiming the result was based on the lies in the campaign and the widespread inability to accept defeat with any degree of graciousness, has reinforced median voter disdain for the antics of social justice warriors and their belief only in democratic outcomes that favour their agenda.

4 – Immigration is dominating median voter sentiment
In 2012 my brother and I visited the home in the East end of London where our grandfather lived in the 1930’s. We pulled up to the home and got out to take photos to be met with stony hostile stares from the many Muslim men in the street. As we drove through the East End and then to the city, we came to realise that, apart from perhaps the odd postman, courier driver or copper, that we were likely the only white European men to enter that part of the city that day such was the proliferation of Muslims, Africans and Eastern Europeans. It had been 18 years since I had been to England and the change to the cultural landscape to Britain in those decades has been profound to the point where whole swathes of English cities are now unrecognisable from their cultural composition for the centuries preceding the 21st century.

One of the foundation principles of any sovereign nation is the right and ability to control their own border. Most people in modern first world nations are in favour of some immigration. Only a most xenophobic and racist minority oppose all immigration. But what has happened to Britain is that they have gradually lost control of their ability to regulate this in-migration. Before the 1992 Treaty of Maastricht ushered in the free movement of people within the so-called Schengen Zone, successive British governments gave preference to the nationals of former colonies such as India, Pakistan and Caribbean nations and so manageable waves of migrants from these regions began in the 60’s and 70’s. The Blair/Brown Labour Government opened the floodgates and embraced the free movement of people in the EU opening the way for migrants from impoverished Eastern European countries and new waves of Poles, Lithuanians, Albanians and Romanians joined a growing wave of migrants from Arab nations. Over the last 20 years, these waves of new migrants have changed the face of Britain in a way that has left increasing numbers of Brits nervous and resentful. When you add in the pervasive political correctness that turns a blind eye to the antics of Muslim extremist preachers, violent east Asian gangs and the rise of Sharia courts and pillories as racist and Islamaphobic anyone who expresses concern about these trends, it only takes a few key incidents such as the 7/7 bombing in London to tip sentiment away from seeming untrammeled immigration.

There were two major immigration tipping points that proved the concerns voiced by the Leave campaign. The first was the massive wave of migrants that swept into Europe in 2015 from Syria, the Middle East then northern Africa via Greece and the Balkans. The one million new migrants that made their way to Germany through 2015 and 2016 and hundreds of thousands more to Austria, France and Sweden and the explosion of illegal migrants camping at Calais in France making increasingly violent attempts to make it to England on trucks has left a deep and lasting impression on British voters. With free movement inside the EU, even with a small winnowing out of fake refugees and the belated attempts by nations on the refugee’s chosen eastern European path to Germany (and even backtracking by Germany and others) to slow the flood, British voters knew that such migrants, once given residency in the county they ended up in, could LEGALLY enter Britain under the free movement provisions of the EU.

David Cameron sealed his fate three weeks out from the referendum when final immigration figures for 2015 were released. Cameron’s pitch in trying to stave off the threat of Brexit (inherent in his decision to hold the June referendum) was that he could negotiate a better deal for Britain if it stayed with the hope of enabling a British government to better regulate the flow of migrants. Cameron said his renegotiated deal would achieve this outcome and he gave the figure of 100,000 as his preferred ceiling of annual migrants. When the ACTUAL numbers for 2015 were revealed, it showed a true net in-migration flow of 333,000 or more than triple the limit Cameron told voters he was striving for when he sought re-election in 2015. His discomfort on immigration was compounded on the referendum campaign trail when confronted with voter questions on the subject of his (and any subsequent) government’s ability to curb this number if voters opted to remain. Neither Cameron nor any prominent Remain campaigner could give any assurance that Britain could curtail immigration if they remained in the EU. Charismatic and popular Labour MP Hilary Benn said as much when pressed by eminent BBC interviewer Andrew Neil saying that part of the package of being in the EU is the free movement of people effectively making the case for Leave that indeed, if Britain stayed in the EU, it could not effectively curb immigration
Faced with the seemingly irrevocable change in the cultural face of the country, with competition for work and the erosion of wages from the army of under-the-counter eastern European workers and with little prospect of being able to reverse this trend, is it any wonder the Brits said enough is enough and voted to Leave? Whilst immigration was not the only reason for the Brexit vote, it was a potent symbol of the loss of sovereignty inherent in the EU project.

5 – The polls were wrong … again
6 out of the 8 major polls picked a Remain result on the eve of the vote and the 2 that picked Leave had Leave only just winning versus the 4% eventual lead. Cameron’s own pollster picked a Remain victory. David covered the failure of Britain’s pollsters to pick the Brexit result.

This failure comes on the back of the similar failure to predict the Conservative absolute majority in the 2015 election. In that election, we saw the re-emergence of the so-called shy Tory and this same dynamic was at play in the referendum. Such was the ubiquity of elite opinion and such was the opprobrium and vitriol directed at Brexit supporters on social media and in the public square, poll respondents yet again told pollsters the politically correct answer but in the privacy of the voting booth, where no one could criticise, they voted how they REALLY felt.

Another dynamic at play here was the skewering of the turnout based on age. The young responded to polls but didn’t vote or at least not in the numbers that the 45-year-old + voters did. We see this same dynamic at play in New Zealand with the persistent under-performing of the Greens in various elections. The Greens win actual votes on average 1.5% lower than their pre-election polling for precisely the same reason – younger voters say they’ll vote Green to pollsters but fewer show up at the polls.

What type of Brexit will be eventually negotiated?
A Norwegian or Swiss model retaining free movement of people or a complete break? The Leave campaign never specified. There are a huge number of unanswered questions and complex variables at play. Who will lead the Conservative government after Cameron’s resignation? Remainer Teresa May or Brexiter Michael Gove? What deals will be cut to win over the Tory caucus that might water down the outcome given a majority of even Tory MPs voted Remain? Labour is in disarray so who will be its Leader? UK Labour’s rules give the power to the unions and the membership so, despite Corbyn’s huge unpopularity in his own caucus, he could yet again dominate a new leadership vote buoyed by the harder left activist base. If he wins again, does Labour split? Would a new Conservative PM hold an election and what would be said on the hustings with respect to the shape of Brexit that might further define how it would look? Exactly how will the EU Commission and the major players such as Germany and France react to the formal invoking of Article 50? Will they seek to punish Britain by ruling out any favourable trade deal to discourage others from leaving? How quickly can Britain negotiate bi-lateral Free Trade Agreements with say the US, China, Korea and even New Zealand? Britain was once the greatest trading nation on the planet and less than a century ago fully 50% of the global merchant shipping fleet was English owned. How soon can and will Scotland press for another independence referendum? Will Remain voting Northern Island seek a referendum severing its ties to the UK and uniting with the EU and euro zone Republic of Ireland? How will the crucial financial sector passporting issue be handled and if the EU plays hardball, how many jobs will be lost to the City of London due to Britain no longer offering automatic banking registration to the EU to the many global financial institutions that are based in London? Will other EU countries manage to get exit referendums on ballots and follow Britain? The answers to each one of these questions will influence the precise nature of how Britain’s momentous decision will be implemented.

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