Breaking Up Is Hard To Do

We beg of you don’t say goodbye. Can’t we give our love another try? Come on Britain! let’s start anew ‘cos breaking up is hard to do. Scooby dooby doo – Neil Sedaka, 1975 – way ahead of his time!

Politicians have a horrid habit of telling us that the electorate is clever and that election results express the will of the people. MMPI believes that the electorate is less than clever and that the results express the votes of a much smaller proportion of the population as a whole. Nonetheless, democratic acceptance means that elected politicians are correct and that the votes cast rule the roost.

UK Prime Minister May has determined that 1.9% of surplus votes represents the majority of the electorate. While this is factually incorrect – the will of the people, as expressed by those who turned out to vote, must be honoured. On that basis she will now proceed to exit the EU and the single market to the cheers of the 1.9%.

Leaving the single market is economic suicide – plain and simple. The UK is turning its back on its biggest trading partner. The implications for UK companies are profound. Finding new markets for produce is not an easy task. Being forced to sell produce into the EU with tariffs and levies attached will prove uncompetitive. Having to endure red tape and tedious paperwork will frustrate patience to boiling point. The EU will not make it easy.

Uncertainty is a key element in spooking financial markets. The ambiguity and indecision of it all will drag Sterling ever lower and this may, itself, bring matters to a head. The lower value of Sterling will drive up the cost of UK imports and lead to higher prices for consumers. Although, a lower Sterling will help UK exporters, their markets will dry up. This will have a knock-on effect for company profits and eventually share prices.

EU bureaucrats and others will not be shy in reminding UK consumers that higher prices are as a direct result of Brexit. Increases in the prices of consumer brands can have an alarmingly significant impact on public opinion. UK tourists will also be subjected to long queues at EU destinations – filing in line behind all other non-EU nationals. Trade documentation may get the mañana treatment causing frustrating delays for deliveries; especially perishables, (Never! – Ed).

All financial centres throughout the EU (and the City of London in particular) operate on the basis of “freedom of services” or “passporting”. This means that all EU financial institutions may freely passport their services to all other EU states without impediment. (By way of example, MMPI openly extends its services to the UK and to Belgium.) But non-EU providers do not enjoy this freedom. All of the companies in the City of London will automatically lose this entitlement before the ink is even dry on the Brexit warrant.

Just like the demise of Dublin following the Act of Union in 1801, London will lose not only the financial institutions themselves but all of the other supporting cast – accountants, lawyers, tax advisers, office suppliers, fancy restaurants; wine merchants, etc. The loss of multitudes of high-earning skilled professionals will damage the UK irreparably. There will be a second referendum with starker wording!