On June 23, the United Kingdom became the first ever country to withdraw from the European Union. In a national referendum on the issue, 52 percent of the public voted to leave, while the remaining 48 percent expressed their will to stay.
The decision has sent shockwaves throughout the British economy. The pound fell sharply following the news, reflecting investor uncertainty at what a free and independent Britain might mean for financial markets. Standard and Poor’s, a ratings agency, downgraded British credit from AAA status. Business confidence took a dip as well, with many firms reporting that they were going to be putting off hiring and investment decisions until the details of the UK’s divorce from the Union were figured out.
This is to say nothing of the upheaval in the British political system. Prime Minister David Cameron, who had campaigned to stay in the European Union, announced his intentions to resign shortly after the vote. A move was also made to unseat the opposition Labor Party leader, Jeremy Corbyn, who many had accused of leading a half-hearted campaign to stay in the Union. Even the triumphant Nigel Farage, leader of the fiercely pro-Brexit UK Independence Party, said he would step aside following the vote.
All this change has many wondering what exactly is next for Great Britain. Will the Brexit vote be looked at as some sort of national suicide? Or will future generations laud the good sense of British voters to escape the inevitable collapse of the EU?
Those who supported Britain remaining in the EU have certainly emphasized the former. Paul Krugman, American economist and adamant supporter of UK remaining in the EU, predicted that Brexit would certainly make Britain poorer, the only question was how poor. Many others, like Conservative activist Shazia Awan, have expressed fears that a Britain outside the European Union will suffer increased racism and xenophobia.
In contrast, the statements from those who voted to leave have been remarkably upbeat. Farage, in his first speech in the European Parliament following the vote, was not shy about touting his side’s victory in front of a hostile audience. Amidst boos and catcalls from his fellow Member of the European Parliament, he referred to the Brexit result as “a remarkable result” and one that would have ramifications for European and global politics. Daniel Hannan, another prominent voice for Brexit, said that Britain in five years would be “flourishing like never before.”
Ultimately, what the long-term ramifications will be are difficult to know at this stage. Though the referendum has been finished, the British government must still negotiate a formal separation with the EU, and much will depend on what the terms of that formal separation are. Were Britain able to secure a comprehensive free trade deal with the European Union on its way out the door, it may well be in a better international position. The benefits of European markets would be open to it, while it would avoid the deluge of regulations and economic crises emanating from Brussels.
Should the European Union choose to isolate the UK once it has left the European Union, however, Britain may find the post-Brexit world a lonelier and less prosperous place than it had imagined.