Joe Otten of Sheffield Liberal Democrats writes...
Until now the economic argument in this EU referendum has been whether you believe the experts – whose reputations depend on the quality of their prognostications – or whether you believe that an ‘expert’ is someone who automatically has less expertise than everybody else.
Just to summarise, thanks to Sky News:
- International Monetary Fund – Britain could cause “severe regional and global damage by disrupting established trading relationships”, should it vote to leave the EU. “Negotiations on post exit arrangements would likely be protracted, resulting in an extended period of heightened uncertainty that could weigh heavily on confidence and investment, all the while increasing financial market volatility.” The consequences ranged from “pretty bad to very, very bad”, managing director, Christine Lagarde added
- PWC for the Confederation of British Industry – GDP down 3 to 5% by 2020, 5% corresponding to 950,000 jobs and £100bn lost.
- Institute For Fiscal Studies – Brexit would cost the UK between £20bn and £40bn, according to the IFS. The Government would need to find equivalent of £5bn of public spending cuts, £5bn worth of savings from social security spending and roll out tax hikes worth £5bn – two more years of austerity – to cover the cost.
Organisation for Economic Co-operation and Development – GDP in the UK could be between 3-5% below the level it might have been if it had remained in the EU, equivalent to £2,200 loss per household.
No longer need we believe them. With polls in the last few days showing a high risk of Brexit, the markets have reacted.
Just to be clear – if the Brexiters were right – if Brexit would make this country a better place to invest, then the reaction to these polls would be that the stockmarket and the pound would go up. Even if they had a plausible theory as to why Brexit ought to make the UK a better place to invest, these headlines prove that the people with the capital to invest do not believe that theory, and therefore will not invest. The Patrick Minfords of this world should see these headlines and admit they were wrong.
The danger is that most of us don’t care much about movement in the price of shares because they don’t affect us directly. Indeed if shares were going down because wages were going up, squeezing profits, we would, nearly all of us, be cheering.
But if shares are going down because businesses are going to find it harder to sell their goods, this is just as bad for jobs and wages as it is for profits.
This is the proof that Brexit would be an act of economic vandalism. It would be a vote for more austerity. It would give the government a mandate to cut health and pensions. Don’t vote for this. Vote Remain.