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Brexit: give me a positive effect... XV

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If I were a Daily Mail reader I might postulate that there is something oddly appropriate about the choice of yellow.

Just as well I'm not, eh!
 
I think that map would be much more informative if the actual voting percentages in each area were represented by shading of the blue to yellow and vice versa - I don`t believe there is only one small area of commonsense in the whole of the North East, for instance.
 
That has the sound of tragically gripping at straws and yes, you ‘will have to learn to live with it’. Good luck for the future.



SEL1VpY.jpg

Thanks for putting that up - I find it very interesting with respect to my native sod - it's well known that Antrim and the northern bit of Down are the Unionist strongholds (indeed, the 1920s' Boundary Commission was supposed to reorganise large chunks of Derry, Tyrone, Armagh and Fermanagh into the Free State (Republicans were banking on this, so that the proposed Northern Ireland would be completely unviable), but it never happened). Interesting to see that Belfast and both sides of Belfast Lough, roughly to Carrickfergus on one side and to Millisle on the other, were pro-EU.
 
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Is it not just easier to say that the reduction in imports/exports and costs to business associated with leaving the SM and CU, and based on the experience of other similar FTAs, as well as that of the past 10 months, runs to a suppression in GDP of around one quarter of a percent annually?

The problem these reports face is how to get across very large changes in the economy in a simple way that people can relate to and understand. I would suggest your sentence is the very opposite of that :)

If you really want a per year figure, I would suggest "Brexit reduces the growth of the UK economy by about 25% a year". Or "Brexit will create on average 2 extra recessions over the next 10 years".

As I said, these reports used to divide the GDP loss by number of households to get a per household £ number which was seen as problematic for a number of reasons. So in this case, given people understand what a massive effect COVID has been and the OBR's has reports for both, it's an obvious move to explain the effect of Brexit in relative to COVID.

I.e. when you say "4% of GDP over 15 years" people think that doesn't sound that bad. If you say "twice as bad as COVID" people understand what a disastrous mistake Brexit is from an economic point of view.

What we must hope, and what is overwhelmingly important and relevant now, is that the policies of this and successive future governments serve to transform this economy from a low value and unproductive one to a high value, productive one.

Governments have been wishing this literally every year since Harold Wilson's White Heat of Technology speech. It would work a lot better if we stopped electing people obsessed with tax cuts and spending reductions.
 
The problem these reports face is how to get across very large changes in the economy in a simple way that people can relate to and understand. I would suggest your sentence is the very opposite of that :)

If you really want a per year figure, I would suggest Brexit reduces the growth of the UK economy by about 25% a year. Or Brexit will create on average 2 extra recessions over the next 10 years.

As I said, these reports used to divide the GDP loss by number of households to get a per household £ number which was seen as problematic for a number of reasons. So in this case, given people understand what a massive effect COVID has been and the OBR's has reports for both, it's an obvious move to explain the effect of Brexit in relative to COVID.

I.e. when you say "4% of GDP over 15 years" people think that doesn't sound that bad. If you say "twice as bad as COVID" people understand what a disastrous mistake Brexit is at least from an economic point of view.

On your first point, I disagree for a number of reasons. Hear me out, because as we have established, I'm a layman, and presumably the reason for this intervention is 'to explain the effect of Brexit to laymen'.

According to your own explanation of the report, the effect of Brexit is static, and if our reading of the OBR's head honcho's statement is correct (4%/15 years) it will suppress GDP growth on average by around 0.25 of one percent every year. GDP growth projections for 2021 are currently dialled in at 6.6%, and 2022 at 5.5%. What the average growth across 15 years will be is in the lap of the Gods, or rather future government policy, and global geopolitics.

Now, are we to accept that the costs of leaving the SM/CU is a flat figure, or a percentage of GDP growth? If the latter, your figure of 25% annual reduction seems excessive for two reasons, the first being set out above. The second is that the UK's annual GDP percentage relating to exports to the EU is only around 13%, and has been on a reducing trend for years. I accept that imports (also on a reducing trend) from the EU also account for an element of GDP (I can't find a figure), and that the extra post brexit costs associated with those imports will themselves reduce GDP growth, on top of the actual reduction in imports from the EU. Against this there will be a greater or lesser degree of import substitution.

I agree that a mean figure for the reduction of GDP growth set out as a percentage of annual GDP growth would be the most helpful method of explaining the effect of Brexit to the layman, but your figure of 25% seems excessive.

The more I think about the OBR boss's intervention, the more I wonder what his motivation was, and upon whose authority he made the statement reported by the BBC etc. The comparison with the covid hit seems entirely disingenuous - covid is (hopefully) a one-off event, and thus its effect will diminish with time, whilst our departure from the SM/CU is an ongoing cost (assuming trade with the EU remains static, which it won't), and will only potentially diminish with improvements to the TCA.

I can't help but conclude that the intervention by Mr Hughes(?) was therefore political, and rather smacks of Project Fear v5.1. His timeline was vague (long run?) but figure (4%) specific. I can't think why else he was moved to make it.

There's one more point I'd like to make; the reduction in GDP growth is associated with our departure from leaving the SM/CU, not Brexit. Brexit took us out of the EU, the policies of which, beyond the SM and CU, are economically increasingly suppressive of trade. Our departure from the EU could, if played right, produce advantages that would act to some extent as a counterbalance to the extra trading costs of being outside the SM/CU.

Governments have been wishing this literally every year since Harold Wilson's White Heat of Technology speech. It would work a lot better if we stopped electing people obsessed with tax cuts and spending reductions.

Yes, governments need to do more than wish it, and I agree with this, with something along the lines (investment, education, support) that I set out above. On your final point though, the current government is now apparently taxing us at a higher level than at any time since the 1950s, and Sunak appeared to be laying out the money hoses in his budget of this week.
 
GDP growth projections for 2021 are currently dialled in at 6.6%, and 2022 at 5.5%. What the average growth across 15 years will be is in the lap of the Gods, or rather future government policy, and global geopolitics.

The best way to understand these predictions is this graph:

Screenshot-2021-10-28-at-08.41.38-550x321.png


Basically they are always hopelessly wrong and everyone knows it and it's a sort of polite game where people don't say it out loud so we can all talk optimistically about the future.

If the latter, your figure of 25% annual reduction seems excessive

Make an estimate of annual GDP growth over time -- lets say 2% per year. 0.25% reduction in GDP means a 25% reduction in that growth, unless me brain really is not working this morning.

I can't help but conclude that the intervention by Mr Hughes(?) was therefore political, and rather smacks of Project Fear v5.1.

You are Fraser Nelson and I claim my £5.

the reduction in GDP growth is associated with our departure from leaving the SM/CU, not Brexit.

I agree. And the Soft Remainer / Centrist Dad position of people like me has basically been to respect the referendum and leave the EU but remain in the SM/CU so the economic damage would have been minimal. This was largely undone by the crazy wing of the Tory party and Theresa May's red lines speech.

Brexit took us out of the EU, the policies of which, beyond the SM and CU, are economically increasingly suppressive of trade. Our departure from the EU could, if played right, produce advantages that would act to some extent as a counterbalance to the extra trading costs of being outside the SM/CU.

I do not believe there is any evidence for this. And whenever you ask Brexiteers to explain they get all hand wavy and then deflect by having a go at the EU.

(Note this is not a request for you to explain this).


the current government is now apparently taxing us at a higher level than at any time since the 1950s, and Sunak appeared to be laying out the money hoses in his budget of this week.

Sunak wants to cut taxes and he wants to cut spending and pay off debt because that is the ideology of him and the Tory party. However, unlike Cameron and Osborne he is not an idiot and at least understands the economics of our current situation.

A prediction I am willing to pin my colours to is that Sunak will revert to type and we will have tax cuts just before the next election and massive spending cuts immediately after.
 
The best way to understand these predictions is this graph:

Screenshot-2021-10-28-at-08.41.38-550x321.png


Basically they are always hopelessly wrong and everyone knows it and it's a sort of polite game where people don't say it out loud so we can all talk optimistically about the future.



Make an estimate of annual GDP growth over time -- lets say 2% per year. 0.25% reduction in GDP means a 25% reduction in that growth, unless me brain really is not working this morning.



You are Fraser Nelson and I claim my £5.



I agree. And the Soft Remainer / Centrist Dad position of people like me has basically been to respect the referendum and leave the EU but remain in the SM/CU so the economic damage would have been minimal. This was largely undone by the crazy wing of the Tory party and Theresa May's red lines speech.



I do not believe there is any evidence for this. And whenever you ask Brexiteers to explain they get all hand wavy and then deflect by having a go at the EU.

(Note this is not a request for you to explain this).




Sunak wants to cut taxes and he wants to cut spending and pay off debt because that is the ideology of him and the Tory party. However, unlike Cameron and Osborne he is not an idiot and at least understands the economics of our current situation.

A prediction I am willing to pin my colours to is that Sunak will revert to type and we will have tax cuts just before the next election and massive spending cuts immediately after.


Well, the positive looking graph looked ok as an assumption until we lost a government that appeared to know it's arse from its elbow.
 
The problem with membership of the SM, as desirable as that may be, is that it is incumbent upon membership of the EU, an overtly political (and, incidentally, growth-suppressive) organisation that a majority of British voters in the 2016 referendum indicated that they didn't want to be part of. That is the situation we have, and the one that we're going to have to learn to live with.
Political: yes, of course, and always has been, pace to that fraction of Brexit voters that "just thought they were joining a common market".
Growth suppressive: well you'd have to prove that. Right now the EU seems to be growing quicker than the UK, i.e. just getting back to the GDP levels of the end of 2019.
Make an estimate of annual GDP growth over time -- lets say 2% per year. 0.25% reduction in GDP means a 25% reduction in that growth, unless me brain really is not working this morning.
My maths are not too hot, but I make that a 12.5% reduction, unless there's a compounding effect or sumpn I*ve missed.
(You put that there just to check we're following, right?)
And the Soft Remainer / Centrist Dad position of people like me has basically been to respect the referendum and leave the EU but remain in the SM/CU so the economic damage would have been minimal. This was largely undone by the crazy wing of the Tory party and Theresa May's red lines speech.
This is the real tragedy of Brexit. There was a perfectly sensible way of respecting the outcome of the referendum while still avoiding the hard Brexit that only the ERG nutters wanted. All so unnecessary.
 
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This is the real tragedy of Brexit. There was a perfectly sensible way of respecting the outcome of the referendum while still avoiding the hard Brexit that only the ERG nutters wanted. All so unnecessary.

I think you needed to go back to the people with a confirmatory referendum on the ERG Brexit and the soft brexit option. It would be the only way of trying to cull the ERG extremism and try and neuter the their ongoing campaign if a soft Brexit won that referendum. Certainly if the hard brexit option won a second referendum well then you would know for certain this is what the majority want.
 
Not quite,

Despite pressing questions, the report said the government had shown little interest in investigating whether the Brexit referendum was targeted by Russia. The government responded that it had “seen no evidence of successful interference in the E.U. referendum” and dismissed the need for further investigation.
But the committee suggested that the reason no evidence had been uncovered was because nobody had looked for it.

“In response to our request for written evidence at the outset of the inquiry, MI5 initially provided just six lines of text,” the committee said. Had the intelligence agencies conducted a threat assessment before the vote, it added, it was “inconceivable” that they would not have concluded there was a Russian threat.

This kind of debunks the 'Hard Remainer' troll I assume your post will be ignored as it knocks a big hole in the hard remainer cul de sac circular argument.
 
More important than me and your assumptions about me is hard remainers blaming everything bad on brexit and for the last 6 years. This was predicted.
There really is no need for anyone to blame everything bad on Brexit. There is more than enough bad stuff for which there is plentiful evidence linking it.

I look forward to you quoting a post from me where I’ve said Brexit is a good thing. I don’t think you’ll find one. What I adhere to is support of democracy and not just when it goes my way.
I was tempted to go and have a look...shall I save my time?
 
I think you needed to go back to the people with a confirmatory referendum on the ERG Brexit and the soft brexit option. It would be the only way of trying to cull the ERG extremism and try and neuter the their ongoing campaign if a soft Brexit won that referendum. Certainly if the hard brexit option won a second referendum well then you would know for certain this is what the majority want.
Maybe, but a second referendum would have brought its own problems: which deal would people have voted on, Theresa May's or Boris Johnson's?. It could have been twisted in so many different ways, and the voters would not have been much better equipped to analyze the complicated trade, macroeconomic and constitutional choices that have baffled Westminster for so many years. It would have represented in some ways a complete abdication of responsibility by the political class in general. I have always been in the camp that while having one referendum was a bad idea, having two would have been worse.
 
The aim, after the referendum, should have been to secure the ‘least bad’ exit. But as so often is the case, the best proved to be the enemy of the good, and here we are. Had Cameron stuck around it’s possible he could have got to some sort of compromise with non-ERG Tory backbenchers, but with him gone and once May’s ‘red lines’ were in place, the loonies took over the asylum.
 
My maths are not too hot, but I make that a 12.5% reduction, unless there's a compounding effect or sumpn I*ve missed.
(You put that there just to check we're following, right?)

No I realised I had made a junior school maths error in the shower. I will write out my times tables 100 times in recompense.
 
I am now convinced Brian voted to Remain and has been trolling you all for the last 5 years.
 
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