Brexit: the effects of a bad decision

At the end of 2016, a referendum is held in the UK on the possibility of staying in or leaving the European Community. Against the forecast and by a narrow margin (52% vs. 48%), the result was in favor of the exit (Brexit). The origin of this certification was a decision of the then Conservative Prime Minister, David Cameron, whose sole objective was to find a place in the eurosceptic wing of his party. For these purposes, it was badumed that the result would not be favorable to Brexit.

The consequence of this historic error was the immediate resignation of the Prime Minister and the appointment, to his replacement, of Theresa May, then Minister of the Interior. Thus, in March 2017, the new Prime Minister invoked Article 50 of the Treaty on the European Union, which defines the methodology for possible departures from member countries. In accordance with the same thing, it was defined that the deadline for agreeing the conditions of separation would be March 29 of this year 2019.

From there, the meetings multiplied. And, towards the end of 2018, a principle of agreement was reached between the Conservative government of May and the European Commission, the executive body of the Union. As stated in Article 50, for this document to have the force of law it was necessary for it to be approved by the United Kingdom Parliament.

Unfortunately, this is where the negotiations got bogged down. The point of friction was the 500-kilometer border currently "open" between Northern Ireland and the Republic of Southern Ireland. In order to fully respect the exit of the United Kingdom's single market, it was necessary to close the border in question in order to prevent the current free movement which both Irishmen enjoy as members of the Community. . However, according to the general opinion, this "closed" border could again exacerbate the religious conflict theoretically overcome in 1998, with all the negative consequences that would imply. The solution agreed in May and the European Commission was the "backstop". Indeed, the border between the two Irlanda would remain open (Soft Brexit) and the United Kingdom as a whole would remain in the customs union, while maintaining free circulation with the European Community "until A solution is found ".

The rejection of this uncertainty has been widespread in the House of Commons, particularly by the Eurosceptics and the Irish allies of the Democratic Unionist Party. Despite this, and once again showing her stubbornness and political incapacity, May put to the vote "her" agreement being defeated twice in January and March of this year.

However, the Prime Minister insisted on the merits of the agreement and went to Brussels in search of an extension of the expiry date of March 29, saying that It was still possible to obtain the approval of the agreement presented to the House of Commons. Brussels' reply, already tired of the comings and goings between the government and the English Parliament, was very clear: May had to obtain the approval of the agreement before March 29; Otherwise, before April 12, he had to submit an alternative that – if it was not approved by the Community – would open the way in a simple and abrupt way without any agreement (Brexit hard).

Confronted with such a dilemma, at the beginning of the week of March 25, Parliament approved an amendment allowing it to vote on eight alternatives to May's plan. Among others: denounce Article 50 to stay in the Union, call early elections with a new referendum, leave without agreement (Brexit hard) or approve the May plan (Sweet Brexit). A real nonsense of options, all opposed to each other. As expected, when voting on the alternatives, none of them got the majority needed to be approved. He turned to zero sheets. Incredible As if that were not enough, May then said that if Parliament approved her plan, she was willing to resign.

He reached an unsustainable situation of institutional chaos, initially created by a wrong political decision made by Prime Minister Cameron at the time. Add to this a terrible treatment of the question by May and a total incapacity of the deputies to channel this nonsense.

It is also clear that we are in the presence of an open end. Over time, the Commission's uncertainties and negative attitudes are becoming stronger.

What would be the economic consequences of a Brexit? At best, with a soft Brexit, Britain would abandon a market for free movement of goods, services, people and capital, which is the second largest economy in the world, to which it allocates more than 40% of its exports and which has a population of more than 500 million people with an average income of about $ 35,000 per capita and per year.

To this must be added, among many other negative consequences: enormous migration problems, the loss of London as an important global financial center, higher prices for imported products and increased inflationary pressures. Absolutely irrational! This process of uncertainties and damage has not been free. Since the beginning of the process, the pound has been devalued by 15% and its economy has already started to slow down. If a hard Brexit is produced – that is, without any agreement – the consequences would be much more serious; among them, logistical and legal disorders of all kinds.

This whole process – both in its genesis and in its development – has been a real waste. This is another example of the lack of true statesmen in the West. It is to be hoped that the UK Parliament will eventually advocate for mental health and put an end to the degradation of the Brexit process. If that were the case, it would seem reasonable to apply the brake, retrace the trajectory and denounce Article 50 in order to remain in the Community or, at the very least, to hold a new referendum and to proceed to a larger extension. Otherwise, a Brexit, hard or soft, would be the worst result for this incredible and negative imbroglio.

The author is an economist