Brexit. What is it?

A rerun on the reasons for Brexit, for those of you who have missed it.

A popular opinion on the reasons for Britain leaving the European Union (EU) is the aftermath of the financial crisis of 2007-08, and the coping efforts thereof, sought by the latter. Though Britain was a part of EU, the group of nations never were fully integrated, by way of their currency and the Schengen Area (concerning internal border controls). Added to this, the recent efforts to cope with the financial crisis reverberations, and thereby poor performance by the rest of European economies were reasons for Britain to opt out of the EU. One significant reason for such poor performance was the performance of the Euro itself. Austerity in the face of recession was quite a contradictory move on the part of the European Central Bank. When in fact economic activity was to be promoted through availability of money, the imposed austerity increased interest rates and curbed spending. The idea behind austerity is to reduce financial burden and help government(s) honour financial obligations. However, contemporary practitioners of Keynesian and neo-Keynesian economics agree that austerity reduces GDP further, plunging the economy into another recession. The EU is a victim to a second recession, for this reason too. Britain sensed potential fragility of the GBP and decided that withdrawing from membership was one of the ways to reduce the impact of the crisis. This being one side of the story, the other side was the political one. David Cameron, the Prime Minister and his party members came under immense pressure to take a vote, to decide on Britain’s future as member of the EU or otherwise.

The common standpoints in favour of Brexit were EU’s economic regulations that were turning out to be onerous, and generous rules of internal migration; the latter generating quite an emotional stand-off.  Generous internal migration rules became so well-used that workers from less well-to-do economies freely entered the UK in search of better livelihood. The migrations had a rather obvious impact on the employment rates of natives in the UK.

In addition to these, EU (authorities) seemed ‘undemocratic’ and ‘unaccountable’ in more ways than one, especially when roles of local governments were concerned.  Were these reasons enough to opt out of the EU? Apparently, so, according to a poll. Older workers and/or citizens voted for Brexit, leaving the younger generation to bear the ‘fruits’ of the decision.

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