The Brexit is happening: the UK is leaving the EU. Wow, we live in interesting times. Most articles I read are about the consequences of this decision. Important as that is, I’m also interested in what clash of forces led to this result, and the bigger picture surrounding it. As a writer, this fascinates me. If we take a step back, what does a Brexit really mean in the grander scheme of things?
I’m going to vent my opinion here. I don’t have a background in economics or politics, and I’m not even British. I’m a software engineer with an opinion. I’m what they call ‘left-wing’, but not a communist. I dislike libertarianism and the modern interpretation of neo-liberalism, but I’m not against competition. I hold with the idea of a free market regulated by a strong government. You have been warned.
Many have already stated that the UK’s decision to leave the EU will have global consequences. Just as the presidential election in the US will have global consequences. Of course, when a butterfly flaps its wings, that too will eventually have global consequences. Global consequences sounds ominous, but really, everything has global consequences. It’s emblematic of the scare-mongering going on on both sides of the debate.
The Brexit will naturally have global consequences. Proponents and opponents differ in what those will be. The opponents mostly harped on the economic consequences, while the proponents were more into the social ones. Immigration laws and regulations forced on the UK by the EU were the focus of the Brexit camp. Basically, the UK doesn’t want cheap East-European labour to force out their own workers. They don’t want Syrian refugees, and they don’t want their industries hampered by European regulations. The opponents counter that the economic damages to the UK will be enormous. In other words, it’s a debate about the pros and cons of globalisation.
Globalisation is not the same as capitalism
We’re living in the Internet age, where the world is connected by fiber optics and anybody can place a real-time video call to the other side of the planet. You can order stuff from China and have it shipped to your door in a day. Our electronic gadgets are manufactured around the world. Globalisation is here and we cannot turn back the clock back easily.
However, globalisation is not the same as a global free market. It might seem that the two are the same thing, because economies and markets have been globalised already and politics haven’t. Big companies are increasingly unhindered by country boundaries. That’s because communication around the globe is virtually free, and shipping is cheap. Because money is not politically charged, there’s constant work to harmonize regulations and make trade agreements so that companies can produce anywhere and sell anywhere.
Companies now move the work they need done to the places with the cheapest labour. Unfortunately, ‘cheapest labour’ usually means ‘worst social conditions’. That’s where politics lag behind. Welfare, healthcare, and pensions are things that everybody needs at one time or another. Everybody pays a share, and everybody benefits. Of course, ‘everybody pays’ means that everybody in a given country pays a part of their salaries. Global companies can pick and choose which country they use as a supplier of labour. The free market means that countries are competing with their welfare levels. Without global regulations in place on how to treat employees or what level of welfare they should have, the worst treated employees with the least benefits get the job.
On top of that, our level of automation is increasingly making manual labour obsolete. The percentage of the population that needs to work to keep our level of wealth is dropping. Unfortunately, capitalism dictates that the only way to gain wealth is by working. Everybody is supposed to work for a living, but there is only enough work for something like half of the population. It’s like playing musical chairs with people’s lives. The people without a chair are screwed and the people who own several chairs get to exploit them.
The EU as a neo-liberal vessel
Okay, back to the Brexit. A lot of people in the UK – and let’s not kid ourselves, in other countries as well – feel that the EU is more of a problem than a benefit. The root of the problem is that the EU causes the things I described above. The open European markets are causing competition between the labour forces of the EU. Some people are getting rich in the London financial district, while the general population is shackled by crippling debt. This is a direct result of the EU pushing for EU-wide open markets, without pushing for EU-wide welfare, banking, and labour regulations.
Interestingly, many – the UK chief among them – have been pushing for the EU to only deal with economics, not with politics. That statement is ludicrous, politics and economics are intertwined. What this translates to, is the EU opening markets without regulations, neo-liberalism in other words.
The end result has been that the UK is now exiting the EU. And that’s a shame. Mostly because they seem to want to go further down the road of no-political-only-economical relations with the EU. A road which will only increase the problems that they are having.
A global conflict
If we take another step back, this same conflict is playing out all over the place. When the iron curtain fell, Russia was shock-treated to capitalism, and they reverted to a dictatorship to try and get clear. The middle east is sick of the US trying to push neo-liberalist capitalism into their countries. And finally, the US itself is filled with angry people that vote Trump.
To summarize, It’s the same conflict over and over: global markets have outpaced global regulations, making the market ever more unregulated and the inequality in the world ever greater. And those who disagree with that inequality are increasingly lashing out.
Bye, bye, Britain. May the Brexit not backfire on you.