Will Brexit give us the 1950s or Hong Kong?

April 18, 2016

At the risk of overgeneralising, Brexiteers have two, rather different world views — 1950s Britain or the hip, modern, perhaps like Hong Kong. One certainly is more likely.

The two views, roughly represented by the two campaigns, Leave.EU and Vote Leave, see the desired outcome quite differently.

The modern, hip and urban Brexiteers want a more dynamic Britain, one freed of the shackles from Brussels. Perhaps implementing freewheeling capitalism. As some argue, capturing the glory of capitalist Britain of the 19th century or perhaps the more recent Hong Kong. Free markets and smart immigration.

Instead, we may just get the 1950s, the low point of British economic policymaking. Remember the 1950s? Stop and go monetary policy, industrial policy, nationalisations, capital controls, closed borders.

The Brexiteers complain about having to import all these rules from Brussels. If only, we could run our economic policies ourselves, things would be so much better.

I don’t think so. We like our financial regulations, and considering that our GDP per capita is just slightly over the European average, the quality of British economic policymaking is decidedly average.

If we vote to leave, the quality of policymaking will fall.

If we want to continue exporting into Europe, we will have to adopt their rules anyways, but without any say. Just ask the EEA members. And, for the Norwegians the price of access to European markets is unhindered immigration from Europe. Will the EU be any more favourably disposed to Britain?

Leaving 2016 for 1950s policymaking will be a giant step backwards.

The financial markets are pricing this in.

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