Seanm
pfm Member
Why would you assume the existing studies haven't taken these basic things into account? Maybe you think the experts are all Brexit-loving traitors?I’d not be anything like so confident! The financial collapse of 2008 left the nation hugely damaged with very little structural resilience. This is why we have been flat-lining on the cusp of recession ever since. Interest rates are already at close to 0% and our banks remain over-leveraged. Basically most of the tricks used to keep the wheels on last time can’t be used again as there are no interest rates left to cut. Add to that all the problems and increased costs of border tariffs, loss of industry, inflation, job losses, the loss of much of the London financial serices industry etc etc will bring. We are currently just 0.3% away from a recession, we have no answers to the fantasy NI border, we have nothing to offer our large EU-facing industries etc. It really would not take too much of a diwnturn to swing the banks into a precariously negative position and Stirling itself may be at risk (it cost £bns to save it from collapse in 2008, a price we are still paying).
As a random example just think of how a hard-Tory/Corbyn Brexit will impact say the NHS with regards to procurement etc? The additional costs of medicine, equipment, staffing etc will add huge amounts to the running costs just to tread water. The NHS needs additional investment of £bns as-is, we shouldn’t be wasting any of that on paying more for core supplies. Same logic applies to everything else too!
The tricks used to keep the wheels on after the crash are the very few that the Conservatives and Lib Dems allowed themselves under their politically motivated and economically perverse austerity programme. Labour will not face the same artificial constraints: in addition to QE, which AFAIK is still fit for purpose, they will be able to take a more rational approach to borrowing and to fiscal policy in general.
What's interesting about the more apocalyptic takes on the Corbyn-as-Enabler theme is that they take for granted a Tory win at the next election. I can't help thinking this entire conversation is a way of reviving the "Should Corbyn step aside" thread while bypassing the embarrassment of the the 2017 election. The terms are basically the same, even if some of them have been reversed (Corbyn too idealist/Corbyn too pragmatic), but it's just all more desperate.