In the aftermath of the Brexit referendum the usual suspects were out in full force. The United Kingdom would be the big financial loser. Its economy would shrink. And yes, the financial markets were in turmoil. The big financial houses had bet the wrong way. But did you observe some figures at the close of trading in major European stock markets on Friday?
The London FTSE 100 index was down 3.15%. But across the channel, the German DAX index was down 6.82% and the Paris CAC index was down 8.04%. The EURO STOXX 50 index was down 8.62% and the EURONEXT 100 index was down 6.72%. In other words, the percentage drop of leading stock indexes in the rest of the European Union was, on average, more than double that of the London index. In passing, we might observe that the Swiss stock index dropped by 3.4%. It so happens that Switzerland, shortly before the Brexit vote, formally withdrew its application to join the European Union.
Amidst all the hyperventilation from financial pundits, what might these figures be suggesting? Contrary to the propagated bunk that Britain would suffer economically from withdrawal from the European Union is the simple fact that Britain is a net contributor to the European Union. According to published figures, it appears Britain contributes around 21% of European Union net receipts. In other words, membership of the European Union is a net drain on British finances. Could the markets be telling us that it is the Eurozone, not the United Kingdom, which is facing a financial crisis?
One should not have to spell out the bleeding obvious: where was the benefit in being shackled to a sclerotic, economically comatose bloc which appears unable to conclude a trade agreement with the United States? By contrast, Britain will be free to conclude trade agreements with the US and East Asian countries, as well as renewing relations, both political and economic, with countries such as Australia and New Zealand.
As for the push by the Scottish National Party Government, led by Nicola Sturgeon, for a second independence referendum, a reality check is in order. First, Scotland’s solvency is dependent on continued subsidies from the British government in London. In the aftermath of the British withdrawal, it is hard to imagine the European Union welcoming a new member which, from day one, would be net dependent on subsidies from Brussels. Under the rules of the European Union, Scotland would have to make a fresh application for membership. Second, any application for membership has to meet with the unanimous consent of all existing member states. Would Spain agree to an application from a breakaway state, thereby ceding legitimacy to the Basque claim for secession from Spain? I suspect that moves for any Scottish breakaway from the United Kingdom will suffer a similar fate as those moves, some years back, by French-speaking nationalists in Quebec.
In addition to the financial elite and the powers-that-be in the European Union, President Obama and sundry other political elitists, the Remain campaign was enthusiastically supported by an assortment of far leftists and the Muslim community, heavily concentrated in London. The more British voters, outside London, heard Sadiq Khan, Mayor of London, take centre stage on the Remain side, the more likely they would swing to the Leave side. To hear devotees of jihad and sharia extolling Remain only served to reinforce the case for Leave.
Not surprisingly, the Leftist/Islamist alliance refuses to accept the referendum result. The million-plus signatures on a petition, seeking to overturn the result of the referendum reflect the view that the majority is composed of stupid, racist xenophobes who do not know what is good for them. Indeed, the far Left, Islamists and Brussels bureaucrats share in common an utter contempt for democracy. Signs such as “No Boris, No Borders”, held aloft by protestors, reinforced how correct the majority was to vote as it did.
Perhaps more than anything else, the outcome highlighted how out of touch so much of the British political class were and reman. Only UKIP, led by Nigel Farage, was fully in tune with majority sentiment. A large section of the Conservative Party is hopelessly out of touch with its traditional supporters. The Labour Party,ow riven by discord, resignations and the rising smell of revolt, is even more alienated from its traditional working-class base.
The implications for British politics from here on may be profound.