One of the least reported events taking place in the world is the recent referendum in the United Kingdom on whether to stay in the European Union. The referendum is non-binding, meaning that the UK Parliament does not have to actually craft the legislation to leave, but it could be political suicide if the politicos ignore the vote of the people.
David Cameron, the current Labor Prime Minister of the United Kingdom campaigned hard and long to keep Britain in the EU. Political parties were split over leaving, and it boiled down to why people may or may not be discontent at this point in time.
What’s going to happen to Britain’s economy? What happens to the United States economy? In the long term I don’t think there will be much to write home about. The biggest things for Britain to craft in their legislature are new trade agreements with their trade partners, and I seriously doubt that new agreements would be different from the old agreements.
In the short term markets around the world will thrash up and down as investors will consider the UK move to bring major uncertainties to the financial world, but I believe these will be only temporary perturbations to the world markets because of the referendum.
Some countries in the United Kingdom do not want to leave the EU. Scotland is one of those. One of the questions to be answered is if Scotland and other countries leave the UK, will the UK fall apart? I don’t think so, but nobody knows what will happen.
The major worry for the European Union is whether other countries will follow the UK in the quest for independence. Many people believe that the EU is not functioning well, at all. The European Union parliament is a non-elected body. I don’t know how this works, but it amounts to the fact that the member countries are not the masters of their own political and economic futures. To me and most Americans that’s a deal breaker.
It will take some time to see if the United Kingdom parliament follows through with the citizens’ wishes. As far as I am concerned, I say hurrah for the Brits.
God save the Queen.