No surprise. Passporting (allow banks to operate in all members of the EU if they are licensed in one member) is a key to all of the banks operations. Every bank based in London for that purpose now has to open a regulated branch in an EU member. The next thing to kill the market in London will be the movement of Euro clearing to an EU member. Brexit is a self inflicted shot to the head. The number of people that supported leave and lacked understanding of all the ties of the businesses that operate in the UK but sell in the EU was amazing. All the car manufacturing will be the next to move. There goes all the good jobs that the leave camp said were being stolen by immigration.
Edit: typo and to clarify I am not an UK or EU citizen, only outside observer of the train wreck.
I don't feel bad (much) for those who voted for Brexit - all they had to do was spend 15 mins googling and thinking. Even if they didn't understand the full impact of leaving the EU, it was plain then (and now) to see it is such a bad idea from any angle. I do feel bad for those who voted to stay - they're gonna suffer now, despite voting responsibly and sensibly.
I don't know how to take this - one way to look at it is democracy won and people spoke, the other way to look at it is we can't always expect the masses to make rational/sensible decisions.
> I don't know how to take this - one way to look at it is democracy won and people spoke
Democracy failed here. People elect representatives for a reason. Normal people shouldn't be expected to understand the complexities and nuances of a public policy decision. It should have been the responsibility of the elected representatives to have reasoned discussions, to weigh the pros and cons etc. and finally make decision for the people they represent. They abdicated on their most basic duty and we are in this mess now.
Humphrey in Yes, Minister puts it very aptly: the UK joined the EU to try to screw it up from within after failing to screw it up from without. De Gaulle saw through this and that is why he refused to let the UK join while was at the helm.
The UK leaving the EU and/or disagreeing with what it stands for (to the UK: a market; to the rest of the EU: a peace project with benefits) has been a debate ever since the UK joined. If I am not mistaking, nearly all challenges to PMs in the UK since have been about the EU.
True, the EU is not perfect. But it's more or less functional and it's brought us peace since 1945. Plus, as an EU citizen, it's wonderful to be able to move from one point on the continent to another on a whim.
A large chunk of EU MP's time is actually spent transcribing EU law into Member State law, which is to say a lot more -- good -- stuff gets done in Brussels and Strasbourg than gets reported by the media. The EU, as an aside, happens to be a convenient scapegoat across the EU: when it's good, it's because of us; when it isn't, it's because of Brussels. But you'd never know that reading UK press.
To me the real WTF is that Brexiters didn't even believe in their own project all while pushing for it [1]. They had done such a good job in the decades prior at scapegoating the EU for just about everything, that UK voters ended up voting Leave, thereby pointing a gun at their own face.
More outrageous still is that some of the movement's leaders, such as Farage, are jumping ship by moving to continental Europe.
Frankly, as a continental EU citizen who has been watching this circus with growing awareness since the late-80s, the only thing that comes to my mind is: unless the UK public gets its act together (in which case I fully expect the rest of the EU to insist on the UK abandoning its budget rebate nonsense and adopting Schengen and the Euro, on top of aligning with the EU project once and for all), good riddance.
UK? No... This is an issue of English imperialist history. British Empire is dead, but too many people forget that.
English majority was lying all the way from mid 20th century. Last two blatant lies - promise to the Scots to keep them in the EU and 350mil to NHS(which was really a front for "they are stealing our benefits").
Democracy didn't fail - the process of legislation failed. The UK didn't vote on how they would leave the EU or what was wrong with the current arrangements, they just strung together a poorly-worded promise and played chicken with the constituency.
That's not so much the problem here. The problem is that the voters answered the wrong question, as a result of a bad binary choice and lying campaigns.
If voters had known what they are in for, they wouldn't have voted to leave.
Have you asked each and every person to come to your conclusion? I voted "leave" because I don't want unelected officials like Junker deciding the law of the land in a UK.
Perhaps you should get more informed and read up on the Kalergi Plan.
There is such a thing as surveys which can capture motivations and reasoning. And then there is the rhethoric of the leave campaign, some of which was obviously untrue back then (the famous NHS line on that bus), and some have turned out to be lies after the referendum (like the optimistic assumptions about a brexit deal). At the very least the voters did not have a clear picture of how the deal would work out.
Your point about "unelected officials" betrays a fundamental misunderstanding of how the EU works. "The EU" or its officials don't decide that much, if anything at all. Most of it relates to being able to exchange goods and services in a fair and safe manner. And even then, these decisions are driven by the elected governments of the member countries, because the "unelected officials" are selected and directed by those.
For example: if a company from country A is providing a service in Country B, using workers from country A, then there need to be certain rules. Labor protections should apply equally, as should professional qualifications and such. Similar things apply to goods traded between countries. If one country lowers its standards, for example for medical equipment, and the other members are forced to accept that equipment, then there is both a safety concern and a competitive concern. That's why so much regulation is coordinated at the EU level - and driven by the member states.
And no, bilateral treaties can't keep up the slack, because 28 member countries would have to have bilateral treaties with each other, which would be impractical.
It looks like what this guy was saying was that people would be fucking a lot and ethnic groups would mix as time moves on. I mean, this is literally the story of homo sapiens. Mass migrations and ethnic mixing - been happening for hundreds of thousands of years.
as you are telling others to be more informed, and you said that Junker is unelected.. how do you think Junker ended up in there? Do you think he can just do whatever he wants without having to asked? Or you think every important official should be directly elected by the citizens? Spoiler: it does not happen in the main democracies for roles such as president or even head of state, and of course it does not happen for the Queen. I would be more upset bout that than about Junker.
Particularly these "unelected officials" are a necessary part of every burocracy.
Unless a voter spends a ridiculous amount of time studying and keeping current in politics, he can only meaningfully participate in a limited number of elections and issues. "Down the ballot", even for things like AGs or Judges, much less regulatory officials, people lose interest and competency.
Politics failed, not democracy. Failed to offer an intelligent question, failed to present rational argument (never have I seen such disingenuous campaigning, by both sides, in UK politics as for the referendum), failed to present the result in the context of our constitution and system.
The referendum was called by Cameron to try and keep the party hardliners in their box. Nothing more than playing politics. The remain vote was supposed to be a foregone conclusion or he'd have not called that referendum at all. Cameron's reaction the morning after says it all.
In the words of Chris Patten, former Tory chairman:
"The whole sorry shambles began with a decision to call a referendum in order to try to manage the English nationalist right wing of the Conservative party."
I agree, however I feel the same about the election of President Trump. The founding fathers created the Electoral College to prevent the masses from doing something stupid. The US Constitution is a document that was designed to only allow as much democracy as needed to prevent a dictator (King) but no more. The founding fathers, internally vs what has been publicized, were teriffed of the masses. The masses in charge get you the French Revolution. While I agree there where some that needed to loose their head it became a blood bath. I would say the same thing of China, where the masses happily killed everyone Mao pointed at.
The newspapers have spent 30 years running misleading stories about the EU, and at least 20 running scaremongering about immigrants ever since ECHR came in. In some ways it's the biggest victory for a campaigning press in history.
Yes, a democracy needs an informed electorate to function. But it is the electorate's responsibility to keep themselves informed. There will always be fake news, click baits and outright wrong/illegal manoeuvers from someone or the other.
IMHO, if the electorate can't take a few mins to understand what they are voting on, they don't deserve to vote.
> But it is the electorate's responsibility to keep themselves informed.
Is it? Surely this is why we have people we delegate to because most people aren't going to be spending their time trying to keep up with the finer points of macroeconomics within a multicountry trading block as it pertains to tariffs, etc.
Much like I delegate to a doctor when I'm ill - if he gave me the wrong treatment and said "it's your fault, you should be better informed", that would seem a little harsh, no?
I disagree with your analogy. You're equating a highly regulated and complex profession like medicine with unregulated, emotionally charged profession like politics which routinely attracts the worst possible humans to participate (not the voters, but those who contest in elections). Tell me honestly - how much effort and time would it take for a British voter to read up the basics of Brexit, and then take 30 mins to think through it, the day before the vote?
Compare this with cancer or some other problem for which I go to the doctor to - it is not an easy task to understand the nuances of various drugs and treatments. Still, at least some people spend time and learn as much as possible before putting drugs into their bodies. But there is an implicit trust in doctors, because bad doctors don't last long in their profession. But bad politicians? It is almost a given that if a politician isn't a crook to some degree, he/she isn't gonna last long. By this time, the electorate should have learned to view everything that comes out of any politician's mouth with distrust, the opposite of what they (generally) do to a doctor.
Also, one doesn't need to learn the finer points of macroeconomics - Brexit is a bad idea for Britons, from every angle, even without understanding the depth of the issue.
We can blame the politicians all we want - but in the end, we vote for these politicians. Until we keep doing it, what right do we have to complain?
Sadly, any time I have suggested that not everyone is equal and therefore not everyone deserves the same rights in determining circumstances for others, someone has invoked Godwin’s law.
There was a lot of misinformation and unrealistic promises made by the Leave campaign that swayed the vote in their favour. The campaign was also unlawful due to illegal overspending which May ignores.
If the public were told the truth about what we'd be sacrificing for "sovereignty", I don't think we'd be here.
A lot of people voted to leave the EU, not the EEA, which is all linked together in a gigantic pile of mess, and most barely understands it.
It was like the vote for Trump, the current way of living simply wasn't working out for many, ( Make America Great Again ) and they could not careless about the consequences, since the government had been ignoring them for far too long, they decided to take a vote into something different.
When I read ( arguably only limited in scope as I didn't spend much time on it ) how the remain were positioning themselves, most of their point were money, immigration, money, immigration, money. And really didn't answer any concern of the leave camp. It was like an internet argument, except happening in real life, You are Wrong, and I am Right.
This does absolutely nothing to bring the two camps together. And to me It was very irresponsible from both side of the parties. At the end of the day, a representative democracy, normally people shouldn't have to be making this decision. Now it is the people that are going to suffer.
> Every bank based in London for that purpose now has to open a regulated branch in an EU member
nitpicking but these are unlikely to be branches but rather subsidiaries. London banks will still be able to have branches in the EU to clear EUR payments and access the ECB but are unlikely to be able to do any regulated activity (selling financial products, taking deposits or writing mortgages) out of these branches.
International banks will have bigger subsidiaries in EU countries, while UK based banks will have to get new full fledged subsidiaries in EU.
EC already warned the banks, that shell branches will not be tolerated... As complex operations cannot be overseen by people residing outside of EU jurisdictions(that's a warning about being a shady dealer, while hiding away from EU)
These banks can't do that part of the business out of the UK or with a UK workforce anymore. So the tax income, foreign currency trade etc goes elsewhere.
Correct. Though if that business was already made out of a EU branch of a London bank (likely for retail business), the tax income was already in the EU, not in the UK.
London has thousands upon thousands of people working in the banking sector. JPMorgan, Bank of America, VTB, Bank of China - all have 0 retail operations in London and massive headquarters. Citibank has barely any retail operations as well...
Sure, in the sort run lots of pain from this. However maybe in the long run brexit will be amazing for britain. The UK has a highly educated, creative, dynamic work force with strong anglo saxon work ethic. This is the country that invented industrialization and modern democratic governance. We stand at the dawn of a new era of technological shifts that are going to require radically different political/economic systems - I would not bet against the UK being the place that invents those systems now it's free from the shackles of the EU. Note I voted remain but the short term economic arguments don't carry much weight to me, all we know is that we don't know as there is so much uncertainty here.
Spanish High Tech salaries aren't exactly low... Neither are Dutch salaries.
A Senior Engineer in London can expect 70K-100K($90k-$127k) on the higher end of the spectrum. Similar rates go in Amsterdam, or US outside of Bay Area and NYC.
It's more likely to be the other way around. People will still try to migrate from the EU to the UK - as they are already doing in huge numbers and are still doing years after the Brexit vote. If there was going to be a major drop in immigration numbers it'd have happened already and it hasn't. In fact immigration from outside the EU has gone up not down.
The amount of fearmongering going on around this topic is quite eye opening and can only mean opportunities for people who keep their head. The top voted comment in this thread is saying that euro clearing moving out of London will "kill the market" and "be a shot in the head".
That person clearly has no idea of the size of the euro clearing market (small), or the fact that it will hurt the EU significantly more - that activity not only takes place in London for good reasons, but it exposes the UK to significant risks in case of clearing house failure ... not an entirely unthinkable problem given the eurozone's dire economic straits (stalling despite negative rates). I'm OK with it though: short term loss of relatively minor profits for banks is probably worth the insulation from the threat of government-backed bailouts in case of eurozone problems.
Also note the article: that money is leaving the UK because the EU is forcing it to leave via regulation. That's not a good sign for the strength of the EU economy - they can't win their own banking business on their own merits and have to literally ban Europeans from using British services to stop them doing it.
My view is simple - the EU is heading in the wrong direction, fast, and not even attempting to turn around. There's a train wreck coming for sure but it's not coming to the UK, as long as we get out in time.
Working in the UK tech sector I am shoulder to shoulder with many talented hard working EU immigrants. We all have passports that have automatic work permits in at least 27 other countries that don’t need us to jump through hoops to work there and whose economy is not in hard uncertainty. I’m lucky tho that I don’t have a family in the UK, I feel for those that have.
I sincerely wish the best for all brits but it is sad like an actual personal break up. Especially as this was just a Cameron/Conservative power play gone wrong.
"Sure, in the sort run lots of pain from this. However maybe in the long run brexit will be amazing for britain. The UK has a highly educated, creative, dynamic work force with strong anglo saxon work ethic."
Well, the "strong work ethic" is well reflected in your productivity :-)
> Every bank based in London for that purpose now has to open a regulated branch in an EU member.
How many of them don't have one yet?
Also, every bank based in the EU will have to open a regulated branch in UK in order to operate in this large market.
> The number of people that supported leave and lacked understanding of all the ties of the businesses that operate in the UK but sell in the EU was amazing.
Perhaps they're just not trying to see only the drawbacks and ignore successful non-members in Europe like Switzerland and Norway.
The UK is the 5th biggest economy in the world. Switzerland is 20th and Norway 30th. The UK has traditionally punched well above its weight economically, it will be interesting to see if we become just another Switzerland or Norway after Brexit rather than the world economic power that we are today.
Being the banking capital of the EU is a huge contributing factor to that position, btw.
Switzerland and Norway both accept large parts of EU legislation and regulations without having a say. They pay into EU programs, without having a say. They accept free movement of workers, without having a say...
UK is currently not willing to do any of the sort. So no, Britain will not get the benefits Norway or Switzerland enjoy...
Here's a list of the top 10 est 2019 world economies. UK will go from #5 down to 7 for sure. If they actually suffer much trouble they'll fall further. #5 UK 2.982T, France 2.935T, India 2.934T. I forgot Brazil was so high, #9 at 2.095.
Mostly because of India's growth. So what? It's GDP we're talking about, a largely meaningless indicator nowadays.
UK is #27 in GDP (PPP) per capita rankings. India is #122.
Is it better to live in an economy with large GDP or better purchasing power? Is India somehow better off than the UK once it overtakes it by GDP due to population growth?
PPP GDP is nearly worthless as a measure. It's a fraudulent number cooked up subjectively at a distance with very little on the ground information. Nobody actually goes country to country and surveys the details to calculate the PPP figures, it's created half out of thin air.
That's how you get Saudi Arabia at $55k PPP GDP per capita, ranking above Sweden, Germany, Australia, Denmark, Netherlands, Canada, Austria, Belgium, Finland, France, UK - you know, just most of the nicest countries on earth.
Back in reality, their GDP per capita is actually $21,000 and ranks them near Greece and below Portugal.
It's also how you get Puerto Rico ranking above Czech, Portugal, Estonia, Israel and nearly outranking Italy, New Zealand, South Korea and Spain. What a joke. Nobody actually went top to bottom through Puerto Rico's situation on the ground before calculating that.
Half of Russia lives very nearly in third world poverty, with incomes bordering on third world levels. By PPP GDP per capita they get ranked next to Portugal instead, which says absolutely nothing about the actual conditions on the ground for the bottom 1/3 or 1/2 of Russia.
Iraq gets ranked above China, Brazil and Colombia per capita PPP GDP. And just below Mexico and Argentina. Again, a joke.
You get Equatorial Guinea ranking on PPP per capita above Slovenia, Slovakia, Estonia and Portugal; just a bit below New Zealand, Spain and Italy. In reality it's a country with a GDP per capita of just $14,000 and a third world life expectancy of ~58 years. Another farcical PPP adjustment invented out of thin air with zero considerations for reality on the ground.
Just as an aside : You're probably much better off to launder your money in London (for example via a shell company owning massively valuable real estate[1]) than in Switzerland, nowadays.
Traditionally money laundring was always much less of a problem in Switzerland than supporting tax evasion.
With the automatic exchange of information[2] this will pretty much be a non issue in the future.
I generally support Brexit, but I'm guessing for reasons much different than yours (I always favor decentralization as a way of increasing the power of the average citizen relative to their government). Maybe we agree?
Perhaps they're just not trying to see only the drawbacks and ignore successful non-members in Europe like Switzerland and Norway.
That's a bit of a misrepresentation, because those "successful non-members" are members of the single market, which is currently something that the UK is actively trying to leave.
Don't underestimate what's happening here – it would have been possible to execute Brexit in a relatively controlled manner, but that wasn't done, and now the UK is rapidly heading towards a pretty unpleasant outcome.
Switzerland is part of Schengen (which UK is not), yet not a member of the single market - they are not in the EU for customs purposes, have many restrictions on imports (e.g. food).
Okay, you're right – it's more complex than I implied.
Switzerland is a single market participant through bilateral treaties, like Norway and Iceland are through EEA. While they aren't "members" of the single market, I think we'd usually consider those four EFTA countries plus the 28 EU states to make up the "single market", though I accept there is no clear terminology in some ways!
Still though, such a relationship is equally not the plan of the current UK government, and customs union membership is not a prerequisite for single market 'membership' as such.
> That's a bit of a misrepresentation, because those "successful non-members" are members of the single market, which is currently something that the UK is actively trying to leave.
The UK is trying to leave the EU and stay in the single market. The EU is trying to deny the UK access to the single market.
The UK had the Norway option, if they'd adopted it as an initial negotiating position -- but it involves agreeing to more than freedom of movement; there are also ECJ rulings and restrictions on external trade agreements. And it's far from clear that the EU27, having been through a fairly torturous negotiation, would have the patience to effectively restart from scratch. (They've signaled willingness to extend the Article 50 deadline for a referendum or election, but not in any other circumstance, and repeatedly stated that the current deal is not now open to renegotiation.)
Might also be interesting to have the view of an actual Norwegian on the Norway option, and how Britain is managing the process generally. She's not the only person on the continent who regards British politicians as malcontented fools who, at this point, deserve whatever they get:
No, the UK is not planning or attempting to stay in the single market. That is not government policy, it is not the basis of the withdrawal agreement, and it is not even the policy of the opposition.
It was the original proposal. Rewind the clock to the start of 2016 and there were leave campaigners and prominent remainer politicians both suggesting that. The UK is not actually attempting to terminate all economic and cultural collaboration with the rest of Europe.
Nobody is talking about it anymore because the EU refused point blank to even contemplate it and stated very loudly and clearly they'd rather die than ever allow such "cherry picking". Note the terminology - the quality of EU governance is very low and the lack of imposed trading barriers is the primary incentive (an artificial incentive!) that countries see for putting up with it.
So that idea got dropped. In fact at this point it's clear that there's no way to retain any form of cooperation with EU countries at all, on anything, without accepting ALL the EU's terms, which are unacceptable as they amount to not leaving at all.
This is a bad approach for the EU to take. Its supporters like to pretend this position is some sort of natural law or inevitability, but it's not. The EU could easily disconnect trade deals and customs unions from the other aspects of its project, but chooses not to, because they know that most people outside France and Germany would not accept transfers of all powers to Brussels without some serious incentives to do so.
First off, you can disregard any statements made by Leave campaigners during the referendum campaign. The same people who are now advocating a “cut all ties” approach were the ones who were saying things like “nobody is talking about leaving the single market”. Looking for ideological consistency is a dead end.
Second, the UK and campaigners should have been well aware of what would be required if the UK wished to retain single-market membership. Those are foundational principles of the EU. There’s no ambiguity there. Anybody who advocated a position that wasn’t reconcilable with those principles was either ignorant or lying.
Third, you are deliberately misrepresenting the nature and state of the EU and it’s negotiating position. There are a clear number of different forms the UK’s relationship with the EU could take. The UK could end up in an EEA-style relationship, being single market participants but with more freedom in some areas. Or the UK could have a more distant relationship and remain within the European customs union. Or a border could have been instituted in the Irish Sea. Or a generally more distant relationship could have been negotiated in good faith. These scenarios were obvious and known, made clear by the EU, and it’s a monumental failure of governance that the UK failed to understand their negotiating position.
The EU has little incentive to change its underlying principles to reflect the demands of the UK, and expecting them to do so is obviously fantasy mismanagement.
I’ll tell you what the actual problem is - Brexit is a project with no real shape or form, into which people can pour their own fantasies. It is totally legitimate for a country to decide it no longer wishes to be a member, but to disentangle a close relationship like that requires clarity about what you want to achieve and why you want to do it, as well as honesty about what is possible and what it will cost. Honesty and clarity are both in short supply.
I agree that looking for ideological consistency is a dead end in any large group of people, including for those who campaigned to remain. Some supported the EU project for ideological reasons (it's an ideological, utopian project after all) and others had purely pragmatic concerns. Some who argued for one side have switched to the other in the years since.
Third, you are deliberately misrepresenting the nature and state of the EU and it’s negotiating position. There are a clear number of different forms the UK’s relationship with the EU could take
That's a very odd claim to make because the EU itself is extremely clear that you're wrong. Here are some excerpts from recent news articles about Theresa May's withdrawal agreement, which the EU is now unanimous in claiming is the only option available at all, that there are no "different forms the UK's relationship could take". Who should I believe? Them or you?
- Germany's Europe minister Michael Roth said:"No deal better than the one on the table can be reached."
- Luxembourg's Foreign Minister Jean Asselborn said .... ""This deal that is now on the table is the best there is. There is no better deal for this"
- Brussels said Mrs May’s Withdrawal Agreement was ‘the best and the only deal possible’ and had been ‘approved, established, achieved’.
These statements appear to contradict you.
The EU has little incentive to change its underlying principles to reflect the demands of the UK, and expecting them to do so is obviously fantasy mismanagement.
Indeed your own position appears to contradict itself. On one hand, there are many possible options with varying degrees of commitment available. On the other, the EU will never abandon its principles. Which, lest we forget, they've said repeatedly means "no cherry picking" i.e. no options.
Honesty is in short supply.
Hmmmm ...
(I would reply but of course, Hacker News has now rate limited me because I got downvoted. This debate will have to play out some other time).
That's a very odd claim to make because the EU itself is extremely clear that you're wrong.
I won’t quite the rest, but I think you have misunderstood the EU’s position on this.
Yes, as I said there are different forms the relationship could take. I described some of them. What there isn’t - as various EU bods you quote point out – is any other deal available at this point. It’s done. If the UK had engaged in this process honestly, from the start, then other deals could have been achieved. Remember this graphic published by Barbier? http://fingfx.thomsonreuters.com/gfx/rngs/BRITAIN-EU/0100603...
I don’t think I’m being at all inconsistent or dishonest here. I’m happy to change my views if I’m wrong. But I haven’t heard a convincing argument that the current situation is the fault of anybody but a comically incompetent UK government.
But I haven’t heard a convincing argument that the current situation is the fault of anybody but a comically incompetent UK government.
You very obviously don't read Mr. Johnson's Telegraph columns</snark>
I agree. The EU was always very clear where their read lines were and never deviated from that. The PM on the other hand made very clear what the UKs red lines are. And does are simply incompatible with what's acceptable for the EU.
An ex-member undermining the fundamental principles of the single market is just not on the table.
I did have a big reply typed out yesterday but couldn't post it. Today I'll just observe that - again - what actual member state and Brussels officials are saying is that this is "the best and only deal that could have been achieved". Not - "it's alright but with more time we'll find something better" which is what you're claiming.
Again, I don't see how your position matches the reality of what is being said by the people in power. So I think I'm not the one who's misunderstood their position.
The EU folk you are quoting are clear that this is the only deal that is available, and that is correct – but those statements are in the context of the red lines established by the UK, and the point in the negotiations that we are now at.
First, please refer to the graphic I linked to. It outlines how the conditions established for an EU exit deal by the UK limited the options that were available. These choices were almost entirely on the UK, and they are obvious to anybody with even a passing familiarity with the various bodies and constructs involved. The UK decided what conditions it was not willing to accept – free movement, ECJ jurisdiction; shared trade policy etc. – and the deal which has been achieved is the best deal possible given those constraints.
Second, realise that we are now at the end of the negotiation process. There is no appetite for renegotiating a deal under these circumstances. The UK and EU have negotiated for two years; if a different approach had been taken at the beginning of those negotiations, a different deal would have been possible. That is now no longer the case.
Both my statement that "a better was possible", and the EU's statements that "no better deal is now possible" are true.
Of course you're downvoted. Arrogant ignorance is just asking for a downvote.
Citing foreign ministers of member states just proves how ignorant you are on EU itself.
Again - single market isn't just trade. Read what four freedoms are, aka single market. The options for UK are clear:
- if you want to leave customs union, you leave barrier free trading
- if you want to restrict labour movement, you leave freedom of goods, services and capital movement
UK's real options, with Brexiteers in mind, is CETA++...
The position of UK and leavers was that of a deranged husband in divorce - demanding sex, without so much as an inkling of fidelity.
So I'm guilty of "arrogant ignorance" and thus deserving of downvotes, but you describe the entire UK as a "deranged husband in a divorce" and then describe foreign ministers of member states as unciteable in a discussion about the foreign policy of member states?
This quality of debate is exactly the sort of thing that led to the Remain campaign losing so badly. I see the slogans and the insults but where are the arguments?
The original proposal was - UK gets the right to access all benefits of trading with EU, including services and passporting rights(I literally watched this on TV at the time in London)... but skip on the freedom of movement and customs union.
You know... Cherry pick which of the four core principles of EU UK wanted to participate in.
So... Maybe your Brexit mind wishes to ignore the fact of the matter, but just because you ignorantly assign a different meaning to single market - doesn't make your recollection any less of a falsehood.
This stubbornness on behalf of the EU will damage both sides economically and thus be corrected at some point when the current EU administration is replaced by a more reasonable one.
The UK could easily stay in the single market by officially canceling brexit. It’s even a unilateral decision. It’s just that you cannot pick the benefits of being a EU member while shedding the obligations. In that regard it’s no different from a good old fashioned British Club.
> It’s just that you cannot pick the benefits of being a EU member while shedding the obligations.
Of course you can, it's a matter of negotiations. UK has/had plenty of exemptions as EU member and Switzerland for example is not part of Schengen but in the single market.
It amazes me how people here think that the EU is somehow the entity that makes up all the rules. It's not, deals are bilateral.
Sure, deals are bilateral. Good luck trying to get the EU to give up one of its core principles to a country that cannot even get its government to agree on a consistent negotiation position.
> Good luck trying to get the EU to give up one of its core principles to a country that cannot even get its government to agree on a consistent negotiation position.
The UK government is far more consistent than the EU currently. Name one important issue where the EU has reached a satisfactory agreement and results. Migration? Social security? EU army? Nope.
But just like the tone of your comment, the EU position on Brexit is governed by arrogance, ideological motives and fear of a chain reaction, not reason. Therefore the result will likely be bad for both sides.
> Name one important issue where the EU has reached a satisfactory agreement and results.
The ability to travel, reside, work anywhere I desire in the EU as a right that I can rely on instead of having to ask for permission. The fact that I could marry another EU citizen from another country without having to ask for permission. That we have no extra paperwork related to that, even with a child. I still remember passport checks at the border.
Last but not least: 75 years of peace in Europe. Making the arch enemies of France and Germany friends.
Not all is good about the EU, it suffers from large deficiencies, but it has also brought great successes.
> The ability to travel, reside, work anywhere I desire in the EU as a right that I can rely on instead of having to ask for permission
This was a founding principle of the EU and has been weakened recently as I'm sure you know. Also, in most countries you have to register and are only allowed to stay 6 months without work. Marrying people from other countries in Europe is not a problem and not an achievement of the EU.
> Last but not least: 75 years of peace in Europe. Making the arch enemies of France and Germany friends.
Here you lost me completely. This kind of revisionism is a real issue for the remain people. It was mostly EU countries who bombed Belgrade in 1999(!). 75 years of peace in Europe is a myth (there were plenty of other conflicts, including the current one in Ukraine!) and where it was peaceful it had nothing to do with the EU. The EU was formed in 1992, for heaven's sake.
I'm sorry for being brutally honest, but "75 years of peace in Europe" is one of these typical pro-EU talking points always brought up by badly informed people who embarrass themselves with it.
Registration is a matter of declaring that you're there. You have to register, only if you're getting employed or applying for benefits...
I can rent an apartment in Warsaw, while officially working in Berlin and never bother telling Polish government that I am a resident there. (FFS! I did that multiple times in various EU countries... Ireland, UK, Netherlands, Denmark, Italy...)
And guess what? Nothing will happen. At worst I'll show my tax statement from Germany and tax authorities will fuck off.
Now I moved to US.... Where I have to ask permission to fucking leave this shithole of a country.
> I can rent an apartment in Warsaw, while officially working in Berlin and never bother telling Polish government that I am a resident there
Good for you, but I "can" sneak into any country of the world and remain there illegally like you. It doesn't mean I'm entitled to and neither are you.
> And guess what? Nothing will happen. At worst I'll show my tax statement from Germany and tax authorities will fuck off.
You are dreaming. Look at the legislation and don't argue with slacking bureaucracy.
> Now I moved to US.... Where I have to ask permission to fucking leave this shithole of a country.
Did anyone force you to? I perfectly understand "leave" voters who want to prevent this kind of migration: people who come for economic reasons but show no respect for the country and its laws.
> Good for you, but I "can" sneak into any country of the world and remain there illegally like you. It doesn't mean I'm entitled to and neither are you.
Fun fact - nowhere have I been illegally. And yep,
But sure... You define illegally however you wish.
> You are dreaming.
Yep... I've done that twice. That's my dreaming.
> Did anyone force you to?
I was lied to. You know Americans love to claim that USA is the greatest. It's not.
And I made slightly more in Europe, than do now.
> Name one important issue where the EU has reached a satisfactory agreement and results.
Whenever someone asks for one single thing, they don't mean it. I predict anything I name will either not be important enough or you will not consider anything less than complete unanimity across the continent to be satisfactory.
But fine, I'll play. Abolition of mobile roaming charges across the EU.
The pallets were standardized in a process that began in 1961, initiated by the UIC. It had nothing to do with the EU, except that its big bureaucratic machine introduced some more regulations.
> But fine, I'll play. Abolition of mobile roaming charges across the EU.
So, ignoring your attempt at preventing the obvious answer with your introductory rhetoric, you honestly believe that roaming charges were a significant issue for the EU? Why didn't you mention banning curved cucumbers instead?
The ban on curved cucumbers is a myth spread by the British tabloids.
They did not ban curved cucumbers, they simply provided rules for classification of fruits and vegetables so that buyers know what they are purchasing.
See: https://blogs.ec.europa.eu/ECintheUK/straight-cucumbers/
> you honestly believe that roaming charges were a significant issue for the EU
For me and the other citizens of the EU who happen to live in another EU country, yes, it was a significant improvement.
Name one important issue where the EU has reached a satisfactory agreement and results.
Free roaming within the EU
Standardization of chargers for phones
Free movement (including right to work and study) within most EU member states, plus I)celand, Norway, Switzerland and Liechtenstein
Passenger rights for air travellers
75 years of peace
I could go on, but get the strong impression that any argument, no matter how persuasive, is just a waste of time, looking at your replies.
Deals are bilateral, but club membership isn't. You wouldn't seriously expect to be in a strong negotiating position with Amazon if you decided you wanted to leave Amazon Prime but retain some of the benefits without having to pay the membership fee, for example.
It sounds like Britain's best days are behind it, but it hasn't come to terms with it yet. "Past performance is no guarantee of future results" ought to be plastered in parliament and at Number 10.
"Of course you can, it's a matter of negotiations."
Since the EU is much larger and has to protect her own interest, there is not much to negotiate. In fact, the deal offered is already pretty good for the UK. The last response of "no further negotiations" from the EU made this pretty clear.
Switzerland for example is not part of Schengen but in the single market.
Uhh, you have that exactly wrong. Switzerland is not part of the single market, but sure as hell part of the Schengen accord.[1]
Source? apart from the link provided my last trip to to Prague. I never needed to provide any id in either direction. And id checks, upon entering or exiting the Schengen area, are pretty damn strict.
The Brexit movement has generally rejected calls for a Norwegian or Swiss "you're in the single market but you have to follow most of the EU rules without having a say in their governance." (Not that the Swiss model in particular was on offer, because the EU is pretty unhappy with the amount of specialness it generates).
"The European Single Market, Internal Market or Common Market is a single market which seeks to guarantee the free movement of goods, capital, services, and labour – the "four freedoms" – within the European Union (EU)."
That labour thing is unrestricted migration. I'm 100% sure that migration is the red line.
So... Yeah! May is proposing to leave EU Single Market.
> Perhaps they're just not trying to see only the drawbacks and ignore successful non-members in Europe like Switzerland and Norway.
Norway and Switzerland are subject to almost all the EU regulations but unlike the UK have no say, much less veto, in the making or enforcement of those rules. Is that situation really what Brexiteers wanted?
Switzerland is trying to renegotiate the full freedom of movement that they have accepted previously and while this negotiation stalls, the old rules stay in place.
There’s no reason the UK cannot negotiate their levels of access to the EU market like the Swiss or the Norwegians do, but the EU won’t grant full access without full freedom of movement. In fact, all of this is what’s happening now. How strong the UK negotiation position is can currently be observed.
> How strong the UK negotiation position is can currently be observed.
There's a lot of scaremongering going around. The "no deal" scenario is terrifying for the EU as well, especially if the Britons don't pay the 39b and shut down their market.
Unfortunately, the current EU administration has a track record of self-inflicted wounds (e.g. Russia sanctions), so this is the most likely scenario now.
EU isn't a single country, you know... And there are no countries that will collapse without those 39bn. There's also the fun fact - UK will not get it's rebates.
Let me clarify that. The populace very narrowly said yes to a referendum, which was supposed to restrict immigration[1].
Parliament implented it in a way, which was pretty toothless towards EU citizens who want to move and work to Switzerland, letting the Swiss Popular Party (SVP) going balistic.
Herein lies the rub: The population accepted the bilaterals with ~60% yes (if I recall correctly, I could be slightly off), but the immigration initiative with just slightly > 50%.
The problem is that you can't have it both ways. In essence the country would have to cancel the bilateral contracts in order to restrict immigration to EU citizens.
The current tensions are derived from a couple issues :
The EU wants a frame agreement so that that not every piss squiek new regulation needs to be negotiated, which is understandable
One of the sticky issues, though, is the regulation on EU companies (mostly contractors), which need to pre-announce work done in Switzerland 8 days in advance. The reason for that is to avoid sallary dumping, which makes sense, since salaries can be significantly larger in Switzerland and their minimums are negotiated in binding contracts between unions and employers.
The EU thinks those requirements are too restrictive and the unions in Switzerland fight tooth and nail against softening those requirements. Befor yelling unions! I have to say their position is understandable. The risk of hit and run contractors working for 1/3rd of the negotiated sallaries is just too big.
My prediction is that middle ground will be found eventually after the EU plays some hardball.
Both Switzerland and Norway are part of single market with free movement of EU citizen.
If Brexit happens with a no-deal or no single market access, it's unlikely that it can be compared with Switzerland and Norway situation.
I suspect it will take about ten seconds for the trade concerns the doom and gloomers are worried about to get resolved. UK is the second largest economy in the EU. The idea that they won't quickly and easily resolve trade concerns seems silly. EU member states will still want UK money.
Seriously, the banking services provided by the city will move to Paris and Frankfurt in no time. Outside the EU, London has zero structural advantage or lock-in.
So a few things from that article are important. The first is that a subsidiary already exists. The second is that some clearing already occurs in the US, so there's precedent for non-EU Euro clearing. And third, it looks like the European Central Bank has been trying to get clearing out of London anyways, but was stopped by the courts.
So it's not likely to be stopped since the US clears transaction, and even if it is there's already a subsidiary in France to pass it all through. There'll be some local job hits, but the sky is falling stuff is nonsense. Counties and businesses will still want to do business with UK and they will figure out how to do it very quickly.
Do you actually work in the City or in the financial industry?
There are many cities in the EU. If London has no advantages other than being in the EU then why is so much financial work done there?
By the way, unlike what many in this thread seem to think, being in the EU is of limited value for business protection. France and Germany via their proxies have been trying to pull financial work out of London for years - the EU Commission already tried to illegally ban Eurozone countries from using the UK for certain types of trading and clearing, and the British government had to sue the EU in its own courts to get the ban lifted (said ban entirely violated all the treaties which explicitly forbid that, and the Commission knew it, which goes to show what kind of government we're talking about here).
Despite these challenges the UK has done very well and not just in finance. In 2018, out of the big western European economies (the UK, France, Germany, Italy) which do you think had some of the best GDP growth?
Yes, in the November quarterly GDP figures released by Eurostat, they showed the UK did the best. If you believed what you read in the press you'd think the UK economy was about to collapse, but it's not the case.
"Do you actually work in the City or in the financial industry?"
Well, sorry for the pun, but you obviously don't:
"By the way, unlike what many in this thread seem to think, being in the EU is of limited value for business protection. France and Germany via their proxies have been trying to pull financial work out of London for years - the EU Commission already tried to illegally ban Eurozone countries from using the UK for certain types of trading and clearing"
The EU wanted to have the EURO clearing in countries that have the Euro. The EU supreme court, that is hated so much in the UK, actually ruled that such a demand can not be made since the UK is in the EU (but not in the Euro). Since the UK is leaving the EU now, Euroclearing will move back to the Eurozone with a sunrise period granted by the EU.
It does not make sense to look only of the cost of something (e.g. EU membership fees) without looking of the benefits gained. Allowance of euro clearing was one of the benefits.
What sort of "benefit" does the EU's own civil service try to take away? There is no technical reason why euro clearing must happen physically inside the eurozone. And why do you think the Commission tried to pass a law that violates the treaties? It's because they know that the ECJ frequently ignores the treaties and laws, and does whatever is most advantageous to the EU's ideological goals regardless of what's written - see their ruling on cancelling Article 50 for an especially clear example.
I'm sure you can see why I might consider a "benefit" that the EU itself has tried so hard to illegally remove not an especially compelling argument.
In fact their position is still illegal. EU regs say any jurisdiction that is "equivalent" from a regulations perspective has financial access sufficient to perform clearing, but the Commission has decided that on the day of leaving, despite having still identical regulations, the UK will not be "equivalent". You don't have to be a lawyer to see that if two laws start out identical and neither is changed, then they are still equivalent, but the Commission claims they aren't. This is entirely predictable given their past behaviour, and this time, the court will take their side.
"There is no technical reason why euro clearing must happen physically inside the eurozone."
Yes, there is. Overview concerns and the ability to intervene in times of a crisis. Or how "The Economist" said, in regards to Brexit and Euro Clearing. "Sometimes it is about getting back control" :-)
Another think that makes me skeptical about Brexit: The UK had comparably low debt compared with other countries. During the last financial crisis, the debt exploded, also due to the finance heavy economy. Another crisis may be overdue. If there is a no deal situation and the next financial crisis comes, good luck with that.
The UK was the "sick man of Europe". Then three things happened.
1. Reforms by Thatcher
2. Oil found in the Northern Sea
3. UK joined the EU (or the precursor of the EU)
The oil is running out. And now they are leaving one the the biggest markets. So two out of thee advantages may be gone. Nobody knows the future but call me skeptical about the chances of success.
I could give you a similar list of free trade partners.
The same reason why New York and Hong Kong are the other two financial centres - a high concentration of banks heads are there. Not to mention stability.... Banks love stability.
London is on par with New York at the moment, but Brexit has literally killed that. London will not stop being a financial centre and it's going to be the biggest financial hub in Europe for a long time... But globally, it's now on the level of Tokyo or Singapore.
PS: I used to work in Braclays HQ, the one in Canary Wharf.
And property prices in London/South East become affordable again, Sterling falls benefiting inward investment, exports, and tourism. So not all bad news then! :)
There's so much defeatism within the UK and anti-Brexit propaganda flying around from vested interests. It's all so tiresome.
That seems like a completely nonsense, garbage statement. Brexit is primarily about money and economics, from what I can tell on the outside looking in.
The people who will be hurt the most would be those who are at the bottom of the proverbial food chain to begin with. Desirable areas will still be expensive because people on high income or positions of power will still hold those positions. It's the lower / under paid workers who will see pay freezes and lay offs while the cost of living will continue to rise.
Instead of levelling the playing field, I expect the brexit will just create an even bigger divide between the wealthy and the poor.
Every time someone tries to prove this by doing an unbiased economic investigation, it concludes that the negative effect is either nonexistent or tiny.
Housing competition is fundamentally local - everyone in the world wants London property, regardless of living there. Nobody wants houses in Stoke on Trent.
> Every time someone tries to prove this by doing an unbiased economic investigation, it concludes that the negative effect is either nonexistent or tiny.
That's a pretty bold assertion, not what a quick google reflects
I agree the former poster made a claim of evidence that should be backed up, but you did the same as well. Thus you’re both just as responsible to cite a source when asked.
Incorrect. If I thought earlier posters were intent on engaging sincerely I would continue, but evidence here and previously suggests they are employing derailing tactics masquerading as reasonable argument.
no, Brexit is not about economics and it never was.
Brexit is about having fewer immigrants in the country.
My driving instructor was very honest with me, even if I was a foreigner. He said 50% of his students are foreigners. But he still voted for Brexit even if he knows it will make him worse off financially. He just wants fewer immigrants in the country.
I grew up in a predominantly "brown people" part of the country, I use "brown people" because there were Pakistani's, Indians and other peoples from the crown colonies.
It's worth noting that, we as a country fail to integrate those people. It's not their fault.
It's worth double-noting, that those people are not the people we're removing ourselves from. We're actually removing ourselves from those who are culturally similar enough to integrate independently.
Immigration is /going/ to happen, it's a net positive for the country, in fact it's required to sustain the country.
You've just ensured that it's the "brown people" who get imported.
--
Please bear in mind, I have no ill-will to anyone from those countries, but when people argue against immigration it's almost always because of the polish (which was hugely self-inflicted) or "brown people". The majority of leavers I know don't expect this outcome, they think it'll be a net decline in all immigration (including those from India, Pakistan etc;)
because? If it's because we aren't fertile enough, or our education system isn't good enough, or we aren't paying enough for certain jobs, why not address this?
I'm interested to know whether you think there should be any upper limit to the population of the UK: 100m? 500m? more?
Because we have an aging population, and pensions are the single largest government expense. (more than double the NHS, which is also heavily burdened by our aging populaton)
For many people it was about regaining control of borders and reducing immigration. Personally I'm willing to trade off being a little poorer in exchange for being a sovereign nation once again, although the current direction of travel makes it look like we will be getting Brino i.e. Brexit in name only, about which by the way I'm staggered at how blithely people are willing to discard democracy when the result doesn't go their way.
As a Canadian (and I imagine citizen of pretty much any non-european commonwealth country) I had to chuckle a bit. After being treated like a resource-extraction milking machine historically and then maintaining this pseudo-ceremonial allegiance to a royal head of state it seems funny for someone from the mothership to bemoan a loss of sovereignty and self-determination.
No ill-will intended, just struck me as humorous in what is in all other regards a very humorless situation...
I'm basically a small c conservative, and I think the country is a far less pleasant place to live than when I grew up. If we want mass immigration we also need a massive house building programme, which might involve concreting over the countryside, or perhaps a proper regional policy. I don't see how we can have one without the other. If we were as big as Canada it would be a different story!
I went to the beach with the dog on New Year's day - there were thousands of other people, the roads were clogged, and it spoiled the experience. Buying in the countryside is often not an option depending on your career, because many jobs are only available in the South East, hence you are forced to live in a hyper-competitive area, fighting it out with millions of others for your tiny slice of England.
I'm just trying to explain that my reasons for wanting lower immigration have nothing to do with xenophobia, and everything to do with the realities of life in the SE UK. Injecting millions more people is going to make it a massive miserable conurbation, in my view.
It's a little more nuanced than that ... the SE of England was generally the area most in favour of Remain. Pretty much all of rural England outside of the pull of London voted to Leave.
I see Brexit as the losers in the globalization push taking their revenge on the winners.
Sure, I realise I'm something of an anomaly in my views. Something of a tangent I know, but I can't even walk to my local shop without being choked by diesel pollution, and this in a not particularly large southern town. Is this supposed to be progress?
Regaining control of our borders? Have you ever been to a UK border?
We’re not in Shengen. You can’t just stroll across.
This trope about discarding democracy is tired too. A democracy isn’t “choose once and keep forever”. We are free to change our minds. Or are you surprised that we have general elections every so often?
> This trope about discarding democracy is tired too
Imagine the contempt with which calls for a second referendum would be treated if it were remain that had won. Not to mention, we were told that the vote would settle the issue for a generation. Oh whoops, apparently only if we voted remain!
What does this actually mean specifically? What policy changes do you want that you think you can't have within the EU?
> sovereign nation once again
The UK is sovereign. It's just made some international agreements to align with other countries. If you think the EU is bad for this, wait until you see things like TTIP: all of the legislative override, ability to sue the state in foreign courts etc, and none of the democracy.
A points based immigration policy would be a nice start.
> The UK is sovereign. It's just made some international agreements to align with other countries. If you think the EU is bad for this, wait until you see things like TTIP: all of the legislative override, ability to sue the state in foreign courts etc, and none of the democracy.
One wonders how those poor impoverished nations outside of the big trading blocs survive!
> A points based immigration policy would be a nice start.
How aware are you of the current UK visa tier system? What kinds of people do you think are currently immigrating that would not be eligible under a points based system?
>One wonders how those poor impoverished nations outside of the big trading blocs survive!
Generally they are poor and impoverished, yes. Or they have a deal with the EU and US. Or are tiny exceptions like Singapore.
Of course it's not doomed.
But your position on "too much immigrants" is xenophobic, regardless of how you see it.
You're literally ignoring the fact, that most congestion in London and S/E England is due to internal migration. You're blaming EU migrants for your discomfort, the ones that are most likely to work for a bit and go back to their countries.
EU immigration certainly doesn't help. Also please don't throw insults around without foundation, which I see that you've been able to do with impunity, which says something about this forum.
Not to defend GP's post, but NAFTA and EU are vastly different. Without proper visas, I cannot settle in Canada, I cannot work in Canada, I cannot vacation for longer than 6 months in Canada.
I don't see why I shouldn't be allowed to. I think it would be nice to move freely between the NAFTA nations.
The only reason this is possible is due to UK leadership in the area, so it's actually a brilliant opportunity for the UK to remain at the leading edge.
And I thought they had to, because they weren't allowed to have the military part of Galileo. Which makes the UK the only country without access to high precision GPS.
They had no success negotiation access to Galileo, so they are forced door a Homebrew alternative.
America is the leader with GPS, last time I checked.
To be honest, a lot of your comments lack realism and objective references. I'm 100% sure you live in the UK
Having done a lot of the work here there is considerable expertise in the UK, thus it will be far cheaper for the UK to go it alone than would otherwise be the case.
'SSTL was selected to supply the navigational payloads for the first 14 Galileo Full Operational Capability satellites, in partnership with prime contractor OHB System AG of Germany, in January 2010. In 2012, the OHB-SSTL partnership was awarded a second contract to supply a further 8 spacecraft for the programme and earlier this year the Batch 3 contract was again awarded to the OHB-SSTL partnership.'
It's logical that the UK was involved when they were a EU member ( through partnerships as your opinionated source mentions).
1) It doesn't mean they are a leader ( as you mentioned).
2) It doesn't mean they have the expertise to set everything up ( which they didn't want to, since they tried negotiating for military access to Galileo)
3) It's not going to be cheaper now. They already spent 2,1 billion pounds when they were in the EU.
:)
Edit: can't reply anymore, but I do agree that I don't work in that sector and I don't know those companies.
It would surprise me that there is no ( current) EU-member alternative for the work that SSTL had done.
Edit 2: the current owner of SSTL is EADS ( Airbus). Which has it headquarters in France. SSTL is founded in the UK though.
Edit 3: Inmarsat History is synical in your statement that the UK is better off alone with brexit. Since it's origin is because of international cooperation
Deary me! I don't think anyone serious in the satellite business would argue that SSTL are anything but a world leader in some aspects. Apart from that there's also Inmarsat: https://en.wikipedia.org/wiki/Inmarsat
The UK also has world leading Geomatics capabilities. I work in this sector.
I think one of the positive factors for the UK as regards Galileo is that technology has advanced hugely since Galileo's inception, thus a new UK system can be superior and far cheaper, hence the confidence behind the idea.
> have shifted at least £800 billion ($1 trillion) worth of assets out of the country
And what's the significance of that? Suppose I had $100 in a bank in UK and I moved it to a bank in Germany. Neither country is better or worse because of that. The article doesn't bother to explain the ramifications.
Deals are made in UK because English law is really, really good. Having to maintain offices in EU will surely increase the capital requirements of the banks but it's not a straightforward "Britain is XYZ poorer because banks shuffled some stuff around" situation.
Your seriously misunderstand the banking sector's very real impacts on everyday lives.
Having more assets under management is very impactful because money doesn't just sit in a bank -- it is used again for other things. Thus, there would be less money for loans and other investments.
If you're trying to get a mortgage or start a business, that's very impactful.
If you are a construction worker and financing for new commercial real estate is down, that's impactful.
If you're a factory worker and the factory can't get access to capital to launch a new product line.
What is moving to the EU is EU-based activities, i.e. loans/deposits to/from EU customers, derivatives or repos with EU customers, etc.
For loans and deposits, there were likely to be already booked in EU branches already rather than London. These branches are merely being moved to a EU subsidiary. For derivatives, repos and other, these are not really typically funding any activity in the UK.
In any case it is unlikely to have any impact on lending in the UK. What it will have an impact on is where the banks are making their money, i.e. more EU business will be taxed in the EU (keeping in mind that EU business already done out of a EU branch of a London bank was already taxed in the EU).
Yes, but you have nothing to suggest that this would be the case.
The connection to lending and borrowing is tenuous. There are many things on the books that can't be used to borrow against!
The article just says "assets". What if those were $1T worth of toxic derivatives? Still bad (for UK)?
I simply wish this article was better written and provided some useful and insightful information. $1T makes a nice headline and I guess that's all they needed.
Investors will send money to Saudi Arabia if they smell a good return, while sitting in Bermuda/Alaska/Sri Lanka.
It doesn't really matter where an investor/banker sits, except in fairly narrow circumstances (e.g. depending on who's regulating him/her, s/he might or might not be able to invest in Iran, and have different rules on insider trading, etc.).
This is just such complete and utter nonsense it's hard to know where to start. Are you honestly suggesting that good opportunities to make money by lending to British businesses/consumers are not going to be taken advantage of due to this money going to the EU?! Last time I checked banking was global.
It is significant because shifting the money entails the eventual shifting of the revenue associated with the money. A large portion of revenue for capital is through traditional means such as interest rate arbitrage (difference between lending and borrowing rates) and services. It's only a matter of time before the services start moving to the continent.
When it comes to financial legislation applying to banking, to securities trade etc., English law is largely whatever EU law says it is (it's regulated by the EU). It still remains to be seen what English law will be after Brexit.
As for rule of law in general, it's debatable whether its better in the UK than in the other Western or Northern European nations.
We have reliable courts which are known for their independence.
We also have alternatives to courts - called Alternative Dispute Resolution mechanisms - which operate out of London mostly, and are known to be free of political interference etc.
See http://www.lcia.org/ for an example. You'd write an ADR into a contract and use these people if you didn't want to use our courts. And our courts respect this arrangement if it is agreed upon and treated properly. It's often used between parties even where nobody involved is a British company or person.
So do virtually all other Northern and Western European countries.
What you have that they don't have is the English language as the native language. Non UK lawyers (as me) chose to UK arbitration etc. because of the language, not because we trust your courts more than the German, French or Dutch courts.
Yes, arbitration and other alternative dispute resolution mechanisms in most other countries could be conducted in English, but with UK arbitration we know that we would be able to read the statutes, court rulings etc that the arbitrators read and refer to, in the same language as them.
> QLTS is the official fast-track route that enables foreign lawyers to qualify as solicitors in England and Wales.
Not really an independent opinion so it seems. It would surprise me if they suggested something else, considering their business.
Everyone can find someone to agree with on the internet :)
International people have been judged in "Den Haag" a lot more than anywhere else.
Here are my "opinionated" sources:
> The International Court of Justice (abbreviated ICJ)[1] is the principal judicial organ of the United Nations (UN). It settles legal disputes between member states and gives advisory opinions to authorized UN organs and specialized agencies. ( https://en.m.wikipedia.org/wiki/International_Court_of_Justi... )
> Theresa May has failed to get the EU to agree that Britain will retain a voice at the European court of justice in return for her concession that the Luxembourg court will retain a role in protecting citizens’ rights in the UK after Brexit. ( https://www.theguardian.com/politics/2017/dec/07/brexit-uk-f... )
Personal: haven't ever heard a UK court settle for international affairs. Hague is the only one I remember from events ( eg. Khadaffi, Bemba, ... )
The examples you have given are interesting because they are recent and the province of international agreements. I wonder if English law is used widely in other places and for different agreements as part of a legacy of empire?
In so far as the empire spread the English language. Otherwise, I am not so sure. I have never heard in a negotiation that a party wanted English venue with reference to the British Empire, respect of English courts or similar. It's simply more convenient due to the language.
Usually it's a matter of negotiation. In a contract between a French and a German company, the French lawyer will suggest French law and venue, the German lawyer will suggest German law and venue. If either of them have sufficient bargaining power, it may very well prevail. Among equal parties, a compromise would usually involve selecting a "neutral" legal system and venue. English is the language everyone knows, so usually English is chosen. It's not always UK. Sometimes it Hong Kong or Singapore (typically if a party is Asian). Sometimes it's New York. Generally, European lawyers are wary of American courts and American law with its exotic remedies such as punitive damages. Also, between Europeans it seems unnecessary to go to another continent for arbitration.
I suggested in another comment a historical component to this, namely the legacy of the British empire. It seems logical that having exported our governance for a long time our legal system would be well known through the world too.
English law tends to be incorporated into contracts that are made among countries in Europe, Africa, Asia and parts of the Caribbean. However, contracts made between US entities and other entities frequently incorporate the law of the State of New York and even refer all disputes to courts in the City and County of New York so venue is locked down. There's also an increasing tendency for contracts (other than those for services) to incorporate as a legal framework the "United Nations Convention on Contracts for the International Sale of Goods" [0].
Is it a popular folklore or there is actual, comparable to others advantage in regard to laws?
Britain lately became known for lack of law enforcements towards dirty money. I also not sure how one can manage to claim strong laws and be a surveillance capital of, say, Europe. I'd assume that's because the situation is even worse in other places.
I think so, we don't have state ids. The people are not generally against cctv as far as i can tell, and thats why we have the most survelance. The people more or less trust the state structures. You can see this in the police force, its not combatative unlike, say, the US. The state and the people work together, and thats a cultural norm spanning thousands of years. There are lots of superficially democratically questionable things in uk society, like monarchy. But it all works out becuase i think people do feel empowered with a say in the state apparatus. British people are extremely honest https://www.google.com/amp/s/www.independent.co.uk/news/uk/h... . I think this has been enabled by a long history of rule following, from the rulers and the people.
On your actual point i doubt there is noticable difference in laws. I think culture is more important than laws and our laws are just codifying our culture
English law (technically the laws of England and Wales) are not "really, really good". English law is incorporated in contracts because of ubiquity. Over the years, and for historical reasons, English contract law has become a lingua franca (mirroring the English language) in international commerce - just as likely to be understood by a company in France as by a company in China. There's nothing inherently superior to English contract law versus that of other jurisdictions. In the US a similar phenomenon exists relative to corporate law - among the reasons Delaware is such a popular incorporation jurisdiction is that nationwide in each state the corporate law of Delaware is understood. In fact, in certain "national" law schools it's the only corporate law taught.
English law is also a common law system, relying heavily on previous precedents that have been set down in similar decisions. Civil law juristictions (for example France) give less weight to precedence, so courts have narrower scope to interpret areas the current law does not cover exactly.
English civil law therefore has gained popularity, as it is reliable (precedents can be consulted), and because judges can easily adapt previous rulings to new circumstances.
That's a bit off... Common law has a slightly bigger emphasis on precedents. Mostly because precedents can expand laws and establish conventions as laws.
In civil legal system, precedents are clarifying and very specific.
Common legal system is simpler at local levels(because it doesn't have to consult a central authority), and along with British empire - it is widely applied.
No, it isn't. While I have a lot of sympathies for common low (e.g. jury etc.), it is very inefficient. Codified law is much more efficient.
Do you know why finance contracts in baking, M&A etc. in common low are so extraordinary complex? You have to consider fuer every eventuality and every former case.
>>And what's the significance of that? Suppose I had $100 in a bank in UK and I moved it to a bank in Germany. Neither country is better or worse because of that. The article doesn't bother to explain the ramifications.
Ummm...the German bank can loan or invest about $85-$90 of that. The British bank has to loan about the same amount less. When you talking trillions it ads up. Generally you want banks with a lot of deposits.
Banks don't lend out deposits, they lend based on the expectation of getting repaid. Lending is just an adjustment in the borrower's assets and the creation of an equivalent debt, which is why banks are said to "create money".
Suppose you have 50 million in your UK bank, then move it to Germany. Now that UK bank has less money to work with (lend, invest, credit, etc). That's how I see it.
Assuming this money was actively managed then you can use a ballpark measure of 1% that asset managers collected in management fees per year (ie. ~$10 billion) . That income is now earned outside the UK.
Presumably that means less jobs in the UK and more jobs in the EU to manage that wealth for one. I'm not sure what that means for future growth of the UK financial services industry.
$1T not being managed by uk paid (and taxed) employees. I assume the UK gains soft power, and probably financially gains from money kept in the UK (think bonds, overnight lending etc).
>Neither country is better or worse because of that. The article doesn't bother to explain the ramifications.
This is not entirely true [0]. The money-multiplier effect would mean the bank in Germany then has something like ~$900 more dollars (converted to Euro's of course) that it could loan out. I'm not sure on their exact Reserve Requirement, but it appears to be less than 10%. Apparently the UK doesn't have much of a Reserve Requirement though, so perhaps they would not necessarily lose out as much as Germany would gain in this scenario.
Reserve requirements don't really control lending in the West anymore. The main determinant of whether a bank will issue a loan is whether it thinks the loan will be profitable. The main constraint on bank lending is capital reqirements - i.e. the ratio of the bank's liabilities to its assets.
The 'money multiplier' might have been a decent description of the banking system 100 years ago, but it's basically a myth these days.
The article doesn't mention how much of these assets will be backed to back to an entity in the UK, effectively making the shift of the assets a mere operational step. And working in the industry, I expect the number to be substantial.
The article implies through its journalistic voice that this is objectively bad for GB. The fact that capital has left the country does not have any implication towards the rationality of that move. Various questions to ponder:
1) If this is just capital moving around within their own respective due to legal jurisdictional changes, this may be rational and may not even matter at all. Sometimes you change your behavior due to a change in rules but it affects you neither positively nor negatively.
2) If capital is leaving due to economic fears of leaving the EU, it may be entirely irrational. It has yet to be seen the long term impacts of leaving the EU. It isn't even a settled matter as to whether being a part of the EU is a good thing. Switzerland has done just fine without the EU, Greece has made off like bandits by being a member of the EU, and Germany has likely slowed their potential economic growth by being tied to countries like Greece via the EU.
3) Capital system geographies are surprisingly robust to change. It took centuries for capital systems to move away from Venice and later the low countries. Those capital systems survived massive recessions, multiple unprecedented geopolitical shifts, and numerous invasions and wars. They didn't die because of political turmoil or economic turmoil, they died because other regions learned from them and incrementally improved on their innovations. Compared to the level of turmoil seen in Europe throughout the 16th-19th century, Brexit looks like a walk in the park.
I hold zero opinions on whether Brexit is good for Britain. But economically speaking, I don't see much to fear. I haven't seen much indication that they are trying to destroy their trade regime that was established by default through their membership in the EU, which means that it is still effectively a single market. They already have their own currency and it was already free floating. The banking industry may be prominent in the UK, but all the banks were already multinational and headquartered in various countries to begin with; HSBC isn't losing out on EU business any more than Citibank is. Why is everybody running around like the sky is falling?
Agreed, economics is very finicky and hard to predict with such a high degree of confidence at this scale of complexity. There is a lot of sensationalism and overreacting but until this actually happens and there is time for the market to stabilize it is impossible to know for sure whether this is a net good or net bad.
Even if the end result of Brexit would be neutral in any circumstance, it is entirely possible that prolonged uncertainty would be bad, considering the aphorism that "markets hate uncertainty."
Although, uncertainty doesn't seem to be a big deal in bull markets, so it could be contextual.
I was reminded of this quote from The Big Short at the weekend:
”I have a feeling, in a few years people are going to be doing what they always do when the economy tanks. They will be blaming immigrants and poor people”. (Mark Baum).
Many people feel that austerity policies post the 2008 crash distilled feelings which led to Brexit.
If Brexit leads to another crunch, one scenario is a lot more right-wing politics, not less.
This is obviously not necessarily true, but the possibility made me very sad - and makes one wonder whether Brexit will trigger a spiraling political and economic crisis in the UK, not resolve one.
It really is regrettable that my country has decided to blow its own head off. Finance was pretty much all we had after Thatcher "strategically" destroyed manufacturing and placed the entire country outside of London into a state of "managed decline".
I don't know why this was downvoted, but the UK officially used the "long scale" (million = 10^6, milliard = 10^9, billion = 10^12) until 1974, although the "short scale" (billion = 10^9, trillion = 10^12) had become increasingly popular before that: https://en.wikipedia.org/wiki/Long_and_short_scales#Use. In most of Europe, the long scale is still used today.
The fact that the British empire existed is certainly a reason why they were willing to vote for Brexit. With a bit lesser ego they might have stayed in the EU.
This is 21st c. social media-based warfare. Damaging the West with brexit and right wing nationalists is as strategically effective as a victory in a shooting war.
It really looks like they are going through with it. Up to a couple months ago I almost expected the Brexit to be cancelled.
I wonder when Britain will try to get back into the EU. It would take the swallowing of a lot of pride on the British side, but basically there is already a majority against the current Brexit conditions, pretty soon there will be a majority for remaining in the EU, period.
I hate this argument with a passion. Yes, things will continue to "work". That's an incredibly low bar, though. It's quite possible that if the worst happens, there will be a substantial number of deaths and long-term, lingering economic damage. It could potentially take decades to recover economically, and have relatively little if any upside.
Well, for some value of 'worked'. Few people would actually want to go back to early 70s Britain. And note that the UK was in EFTA back then; it was not as isolated as it will be in a no-deal scenario.
This is an area with little effect on the average citizen, but I have to say I'd never have expected it to be a Tory government to exile financial services from London.
No, things that aren't yet determined how or if they are going to "work" are those relating to shipment of food and medicine. There is a very high risk of short-term chaos. Considering that in 2018 there were a few days without fresh food simply because of two feet of snow, people are really underestimating the potential risks here.
Britain isn’t going to turn into some Mad Max wasteland like some claim, but it will be worse off. The big thing is that on average the larger more open market will have more growth than the smaller more closed one. That growth will be compounded over the years. In several decades people in Britain will be asking why people in Poland have a better standard of living than them.
> In several decades people in Britain will be asking why people in Poland have a better standard of living than them.
In case this ever happens - it won't - this will be attributed to the EU pumping billions into Poland's budget every year. Net benefit to Poland is higher than the UK's yearly contribution to the EU budget nowadays.
So you're happy to have no PC to access Hacker News, for sure no Smartphone, not even a "dumb" mobile phone. No YouTube, Netflix, Amazon. Yes things worked back then but I doubt many people would want to roll back all technical progress since then. Brexit is the legal equivalent to that and any deal IMHO can merely be an attempt in damage limitation at least for the foreseeable future.
Yeah but the reasons for being the case haven't really changed. English speaking country, stable and predictable legal framework, cosmopolitan city. Nothing to do with GDP. All the noise I hear (or read in newspapers) tend to go along banks moving as little staff and activity as they can get away with and staff being reluctant to move. And Paris being mentioned as a prefered location because of its proximity to London (eurostar).
> English speaking country, stable and predictable legal framework, cosmopolitan city.
English speaking being the only real differentiator here and probably the most critical reason. However that only goes so far. And what for sure has changed is that we're down from 20+ currencies before to one huge single market with mostly the same currency.
How that all factors in is impossible to say, but to argue that nothing has/will change seems equally unrealistic as the over-the top reporting of the media suggesting the UK banking sector will collapse. Things will go on, but my bet would be there will be a considerable hit.
IMO it's pretty dumb of the British. You can't join and leave just like that, everything is integrated with EU.
Now, go ahead and undo it because a few % more voted to leave at a certain point. These decisions to join/leave should be like adding a new Constitutional Amendment in USA, very hard to do, either way and require super-majorities.
Is that good or bad news for Britons? Most tangible assets won't be leaving any time soon and nobody but banks will miss this amount in the banks' accounts. It's very likely that real assets, like real estate will become a little more affordable.
Car registrations fell here in Austria as well, despite good economic indicators, it's not a big deal.
For those who don't own, yes. For those who do own, and who banked on the value of their property for things like retirement, etc... or who will go underwater and into financial crisis... it's bad. There is always a two sided balance that has ripple effects in both directions.
If you can get a mortgage when the dust settles, and those holding the property decide to cut their losses rather than cling to it for dear life until it "bounces back".
What if those holding the property are among those who move their $1T out of Britain? The London market in particular was always under huge pressure from foreign investors.
The majority of people in London (where prices are most inflated) live in rented homes, with an average rent that is about the same as in San Francisco, for example, but with salaries that are about half or less.
Foreign property investors shifting away from London will be bad for people whose primary contribution to the economy is buying up properties, and good for everyone else who lives or works in London.
Combined with only 19% of the population (never mind more stock value than their primary residence value) owning any stock, stock ownership among the general population there is not like the US.
That basically means some majority of people there at least are using real estate as their primary store of wealth.
In 2015-16, 62.9% of UK households were owner-occupied. A drop in house prices (which would be incredibly welcome for me, as a prospective purchaser!) would lead to negative equity for a significant number of voters in the south east and especially the south west - no political party wants to own that, though both major parties in the UK bear responsibility for it.
> A significant number of owners live in areas where prices were not affected by EU investment
[Citation Needed]
EU membership has improved the _entire_ economy, and thus house prices nationwide.
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I can't quite tell if you are from the UK or not, but fixed rate mortgages are not normal. Even purchasers who purchased 20 years ago commonly have to refinance their property every two years or so in order to get a fixed rate.
There is a massive 'fear campaign' drip dripping dire news in the UK every day if the people don't reconsider leaving a federated europe. The EU is well past its sell-buy date, won't reform and globalization has taken full advantage of its undemocratic structure for offshore commercial gain.
The divide and rule aspects of the UK EU referendum results are being exploited to the full. Like the last US election there is no good result for the English people - remaining or leaving are both going to have an ugly side. The City of London rules the financial world and enables incredible sums to float offshore via trusts and opaque corporate setups. What we are seeing is a further divide between the haves and have nots.
'At the demise of empire, City of London financial interests created a web of secrecy jurisdictions that captured wealth from across the globe and hid it in a web of offshore islands. Today, up to half of global offshore wealth is hidden in British jurisdictions and Britain and its dependencies are the largest global players in the world of international finance.'
This makes the consumer banks and FS firms shuffling fiat currencies around europe a tiny drop in the ocean
Edit: typo and to clarify I am not an UK or EU citizen, only outside observer of the train wreck.