UK Economic situation and possibilities post Brexit and Covid

[adrock1976]

When I left school in 1993 and had my first job working in a warehouse, this was not long after the Treaty of Europe (also referred to the Maastricht Treaty) was adopted by the member states at the time. Also, it was not long after when the economic fallout from Black Wednesday in 1992 where the UK had left the European Exchange Rate Mechanism as the UK's interest rates had soared too high was still fresh in the mind of many.

One of my workmates who was older than me had commented that we (the UK) should now close the country down and just trade amongst ourselves (England, Wales, Scotland, and both Northern and the Republic of Ireland) - a British Isles only trading arrangement.

I thought at the time that it would be madness as the UK had lost a lot of the heavy industries with not many remaining compared with the Industrial Revolution. However, with the present Covid pandemic and the ongoing Brexit mess, would it help the UK economy to get going again should if there was a hypothetical scenario that the UK would simply just close down and trade amongst its constituent parts (and also including Ireland), and also reduce the debt (which stands in the trillions of pounds)?

 

[nlogax]

(and also including Ireland)

If I understand this correctly you're suggesting the UK should trade exclusively with its constituent countries and, er, the EU, of which Ireland is a member. Is that right?

 

[DB]

I thought at the time that it would be madness as the UK had lost a lot of the heavy industries with not many remaining compared with the Industrial Revolution. However, with the present Covid pandemic and the ongoing Brexit mess, would it help the UK economy to get going again should if there was a hypothetical scenario that the UK would simply just close down and trade amongst its constituent parts (and also including Ireland), and also reduce the debt (which stands in the trillions of pounds)?

Given that we are not food sufficient, and have little manufacturing industry beyond some specific specialisms (and some of that is owned by non-UK countries), how exactly do you think this sort of little-Englandism would work?

 

[21C101]

The exchange rate fiasco culminating in Black Wednesday is the root of Brexit. After that it was never glad confidentn morning again for UK europhiles, despite Blairs efforts.

Three million unemployed, people living on cans of beans to pay the mortgage and an near unprecedented property crash all caused by the eye watering double digit interest rates imposed in futile attempt to keep the value of the pound high against the Deutschmark in the ERM (Exchange Rate Mechanism) to align us ready for joining the proposed Euro, after the cabinet forced is into it in the teeth of Thatchers opposition just before deposing her.

It is quite ironic that George Soros, the financier who brought the whole deck of cards down on the ERM in 1992 is now the Bete Noir of the hard right on both sides of the atlantic.

 

[deltic]

When I left school in 1993 and had my first job working in a warehouse, this was not long after the Treaty of Europe (also referred to the Maastricht Treaty) was adopted by the member states at the time. Also, it was not long after when the economic fallout from Black Wednesday in 1992 where the UK had left the European Exchange Rate Mechanism as the UK's interest rates had soared too high was still fresh in the mind of many.

One of my workmates who was older than me had commented that we (the UK) should now close the country down and just trade amongst ourselves (England, Wales, Scotland, and both Northern and the Republic of Ireland) - a British Isles only trading arrangement.

I thought at the time that it would be madness as the UK had lost a lot of the heavy industries with not many remaining compared with the Industrial Revolution. However, with the present Covid pandemic and the ongoing Brexit mess, would it help the UK economy to get going again should if there was a hypothetical scenario that the UK would simply just close down and trade amongst its constituent parts (and also including Ireland), and also reduce the debt (which stands in the trillions of pounds)?

North Korea and South Korea spring to mind in this context. One unable to feed itself - (like the UK) ends in starvation - the other traded itself to prosperity.

Why does anyone think Ireland (which is far wealthier than the UK) would want to enter into such a situation. Ireland's ties with the UK have gradually fallen over time while increasing with the rest of the EU.

From the Financial Times

When Ireland joined the European Economic Community in 1973, 55 per cent of exports went to the UK. This has since dropped to 9 per cent, while the EU now accounts for almost half of all Irish exports.

 

[birchesgreen]

Autarkies are not fun places to live. Grim as Birmingham is i'd rather live here than Pyongyang.

 

[Chester1]

North Korea and South Korea spring to mind in this context. One unable to feed itself - (like the UK) ends in starvation - the other traded itself to prosperity.

Why does anyone think Ireland (which is far wealthier than the UK) would want to enter into such a situation. Ireland's ties with the UK have gradually fallen over time while increasing with the rest of the EU.

Ireland has to produce two sets of GDP results. The real figures and those minus a large number multinational companies with offices there for tax avoidance (e.g. Apple) whose GDP contribution is very artificial. Its GDP also excludes the poorest region of its economic zone (Northern Ireland). Unification will substantially alter the GDP per capita gap between the UK and Ireland. Ireland is a prosperous country but the standard of living isn't substantially better than the UK.

Manufacturing is mostly dangerous, dirty work creating low paid jobs or very high tech producing relatively few jobs. Manufacturing only makes up a fifth of German GDP vs the UKs eighth. It would be great to match Germany but even that will only increase GDP by 7.5%. Our future is no more manufacturing than it was agriculture 200 years ago.