CRASHING OUT

The wild talk of crashing out of the EU with a no deal Brexit continues. This wild talk should be ignored.

One should remember that a change in an important policy is always difficult, especially if the policy is contentious. Such a change is often forced upon the government rather than a consequence of an analytical rethink.

To give two related examples. When Britain left the Gold Standard in 1931 it did so because it ran out of gold – not because the government was convinced that a better economic policy was preferable. More recently, when the John Major-led Tory government crashed out of the Exchange Rate Mechanism (ERM) in 1991, it was not because they were concerned about the level of unemployment, insolvencies or negative equity; it was because sterling fell in value below the permitted level no matter how high interest rates rose or the level of Bank of England intervention.

The same regrettably applies to Britain’s membership of the EU. Despite the referendum vote in favour of leaving, the government is determined to keep Britain in the EU’s clutches and is determined to implement a policy of Brino and not a genuine Brexit. The most likely way Britain will leave is if the May betrayal deal is rejected by parliament and hence Britain leaves with no deal – as is the law according to the Withdrawal Act that the May Government itself introduced.

As with the exit from the Gold Standard and from the ERM, there will be a lot of wild talk of the dire consequences of crashing out but the reality, if managed properly, will be an economic boom.

Genuine Brexiteers need to hold their nerve and press for no deal.