Skip to main content

Leadership vacuum

In the three days since the UK's referendum it has become clear that the Leave campaign were not merely lying about the impact of the EU, they literally had no idea about what would happen if they won.

The backlash has been enormous- I think the level of "buyers remorse" is now so severe that if the referendum was now re-run, that Remain would utterly crush the Leavers.

The problem is that even if the referendum could be re-run, the damage is already done. The differential vote, with Scotland strongly supporting the EU, and England voting to leave has restarted the divisive and difficult argument over Scottish independence. The economic damage is already in the billions, and the next week will see further carnage in the markets.

From the point of view of the EU, there is a clear temptation to push the UK out and try to reconfigure the Union without the uncertainty. In my view this would be a disaster, not just for the UK, but the EU itself. I have never been impressed by the leadership of Mr. Juncker, but I had hoped better of Donald Tusk, the President of the European Council.

The problem now is the total leadership vacuum in the UK. The political system is going to be shaken to the core, and it is entirely possible that the Conservatives and Labour could both face existential challenges. London is in no position to trigger article 50, and will not be able to do so for some time.

Previous referendums in the EU, in France, Ireland, the Netherlands and Denmark have been rerun, and there is now significant pressure inside the UK, that this happens in Britain too. This is something that the EU leadership should welcome and tacitly support.

If they do not, and Brexit actually happens then, as George Soros forecasts today, we could be looking at the total breakdown of the EU. 

The leadership vacuum in London must be met with understanding in Brussels, otherwise the crisis in the markets in the coming week could finally destroy not just the UK, but the EU too.  

Comments

Popular posts from this blog

Concert and Blues

Tallinn is full tonight... Big concerts on at the Song field The Weeknd and Bonnie Tyler (!). The place is buzzing and some sixty thousand concert goers have booked every bed for thirty miles around Tallinn. It should be a busy high summer, but it isn´t. Tourism is down sharply overall. Only 70 cruise ships calling this season, versus over 300 before Ukraine. Since no one goes to St Pete, demand has fallen, and of course people think that Estonia is not safe. We are tired. The economy is still under big pressure, and the fall of tourism is a significant part of that. The credit rating for Estonia has been downgraded as the government struggles with spending. The summer has been a little gloomy, and soon the long and slow autumn will drift into the dark of the year. Yesterday I met with more refugees: the usual horrible stories, the usual tears. I try to make myself immune, but I can´t. These people are wounded in spirit, carrying their grief in a terrible cradling. I try to project hop

Media misdirection

In the small print of the UK budget we find that the Chancellor of the Exchequer (the British Finance Minister) has allocated a further 15 billion Pounds to the funding for the UK track and trace system. This means that the cost of the UK´s track and trace system is now 37 billion Pounds.  That is approximately €43 billion or US$51 billion, which is to say that it is amount of money greater than the national GDP of over 110 countries, or if you prefer, it is roughly the same number as the combined GDP of the 34 smallest economies of the planet.  As at December 2020, 70% of the contracts for the track and trace system were awarded by the Conservative government without a competitive tender being made . The program is overseen by Dido Harding , who is not only a Conservative Life Peer, but the wife of a Conservative MP, John Penrose, and a contemporary of David Cameron and Boris Johnson at Oxford. Many of these untendered contracts have been given to companies that seem to have no notewo

Bournemouth absence

Although I had hoped to get down to the Liberal Democrat conference in Bournemouth this year, simple pressure of work has now made that impossible. I must admit to great disappointment. The last conference before the General Election was always likely to show a few fireworks, and indeed the conference has attracted more headlines than any other over the past three years. Some of these headlines show a significant change of course in terms of economic policy. Scepticism about the size of government expenditure has given way to concern and now it is clear that reducing government expenditure will need to be the most urgent priority of the next government. So far it has been the Liberal Democrats that have made the running, and although the Conservatives are now belatedly recognising that cuts will be required they continue to fail to provide even the slightest detail as to what they think should guide their decisions in this area. This political cowardice means that we are expected to ch