The economic consequences of Brexit

[anonymous-user]

Does anyone know anything about Ford Otosan ?

[///ajd]

Penny drops with some farmers.

http://www.independent.co.uk/news/uk/farmers-brexi...

I didn't realise 73% of our farm output went to the EU. Coming out of the SM would be pretty devastating it seems.

Looks like they also trusted the brexit team to give them a slice of the £350m.....

[jjlynn27]

///ajd said:

Penny drops with some farmers.

http://www.independent.co.uk/news/uk/farmers-brexi...

I didn't realise 73% of our farm output went to the EU. Coming out of the SM would be pretty devastating it seems.

Looks like they also trusted the brexit team to give them a slice of the £350m.....

Please stop scaremongering, stop with the 'Project peasants stting themselves'.

This is an objective assessment.

http://www.express.co.uk/news/politics/694787/BREX...

[230TE]

///ajd said:

Penny drops with some farmers.

http://www.independent.co.uk/news/uk/farmers-brexi...

I didn't realise 73% of our farm output went to the EU.

It doesn't. Read the article carefully and that 73% is agricultural produce, food and drink all bundled together. Including food prepared from largely imported ingredients. And Scotch, which is a manufacturing business we can safely assume won't be lost to Belgium.

[///ajd]

230TE said:

///ajd said:

Penny drops with some farmers.

http://www.independent.co.uk/news/uk/farmers-brexi...

I didn't realise 73% of our farm output went to the EU.

It doesn't. Read the article carefully and that 73% is agricultural produce, food and drink all bundled together. Including food prepared from largely imported ingredients. And Scotch, which is a manufacturing business we can safely assume won't be lost to Belgium.

Ah OK. Still a huge export issue.

I'd agree Scotch is in a unique position, not so sure about the rest. They must be worrying for a reason, unless you think its just made up and belings in the brexcuse thread.

[davepoth]

///ajd said:

Ah OK. Still a huge export issue.

I'd agree Scotch is in a unique position, not so sure about the rest. They must be worrying for a reason, unless you think its just made up and belings in the brexcuse thread.

The problem for farmers is that without the CAP they are all (and I really mean that) bankrupt. Farm gate prices go nowhere near covering their costs, so they rely on the EU and on diversified income streams.

The NFU did a really good study into the possible effects of Brexit before the referendum, it's still worth a read.

http://www.nfuonline.com/nfu-online/news/nfu-repor...

They came out for remain in the end but it was by no means cut and dried.

[don'tbesilly]

jjlynn27 said:

///ajd said:

Penny drops with some farmers.

http://www.independent.co.uk/news/uk/farmers-brexi...

I didn't realise 73% of our farm output went to the EU. Coming out of the SM would be pretty devastating it seems.

Looks like they also trusted the brexit team to give them a slice of the £350m.....

Please stop scaremongering, stop with the 'Project peasants stting themselves'.

This is an objective assessment.

http://www.express.co.uk/news/politics/694787/BREX...

The Express piece that you comically excoriate stands as much scrutiny as the nonsense that the Independent spouts about the Ford closures and the possible reasons for closure.

One sentence from the Independent states this:

"Shanks said that Brexit had already cost Ford about $60 million in the second quarter with the cost for the year to run to $200 million'.

The referendum was held on the 23rd June, the result was known on the 24th June.
June is the last month of the second quarter.
So when did Ford lose $60 million?
Was it pre-referendum?
Or in the last 6 days of June following the referendum result?
That would arguably make more sense according to the Independent article as Ford are blaming Brexit?

Moving on from that nugget, Ford are also going to lose a further $140 million in the 6 months following the vote to leave which is why Ford are apparently considering closure.

Based on all of the above, why are Ford only 'considering' closing the plants, it would be financial suicide to consider keeping them open.

[anonymous-user]

Interesting read here: https://medium.com/@theonlytoby/history-tells-us-w...

There's obviously much debate to be had around the minutiae, but in terms of "big picture" I think he has nailed it. How we get from where we are to the bad place that the author thinks is coming, and the precise causes of it aren't really going to matter a lot if that is where we end up.

[mondeoman]

Greg66 said:

Interesting read here: https://medium.com/@theonlytoby/history-tells-us-w...

There's obviously much debate to be had around the minutiae, but in terms of "big picture" I think he has nailed it. How we get from where we are to the bad place that the author thinks is coming, and the precise causes of it aren't really going to matter a lot if that is where we end up.

If his thread is right, then brexit is just a minor piece in the overall puzzle - you could even run it back to Maastricht or earlier, because without that, brexit would'nt have happened...

Or even WWII - if Russia and the US had split the spoils differently, Germany perhaps wouldn't have become what it has etc etc etc.

[230TE]

///ajd said:

They must be worrying for a reason.

Uncertainty is a good enough reason to worry. Farming is in a sense the last big nationalised industry (heavily controlled, regulated and subsidised) and I suspect it consumes more taxpayers' money than British Leyland ever did. One thing Brexit will definitely mean is an end to the CAP subsidy structure, so the Govt has to decide whether they want farmers to (a) produce food (b) keep the countryside all nice and pretty for the tourists or (c) concrete over the whole lot to build houses. And since there aren't an awful lot of votes in farming, it is unlikely to be at the top of the Govt's "Important Brexit Decisions" list. New Zealand binned the whole idea of farming subsidies back in 1984, and the farmers who survived are now doing very well, but I'm told it was pretty messy at the time. But looking on the bright side, at the moment with the CAP we have a system where a lot of farmers are struggling to stay in business and taxpayers think the farmers are taking them for a ride. Anything has to be an improvement.

(Actually, there is never any situation so bad that government intervention cannot make it worse, but I'm trying to be positive here.)

[gizlaroc]

This is an interesting article.....

https://www.google.co.uk/url?sa=t&rct=j&q=...

Edited by gizlaroc on Sunday 31st July 15:49

[///ajd]

gizlaroc said:

This is an interesting article.....

https://www.google.co.uk/url?sa=t&rct=j&q=...

Edited by gizlaroc on Sunday 31st July 15:49

Yes, interesting.

Bernard (Tory MP) is keen on just ditching our SM access deal and hoping for tariff free access to be agreed to - they'd be mad not to seems to be his angle. Again he tries to say tariffs would be good for our income - forgetting it would billions more cost to UK consumers. He's basically saying e.g. an equivalent to 30% VAT on cars would not matter as the govt wouldmake more.

There is also the contradiction that trade deals with EU take ages, but some how the 28 new deals needed to keep car exports tariff free to EU countries will be a trivial matter done by lunchtime.

He also just chucks financial passporting under the bus as if it doesn't matter at all. Might not the him. Nice of him to be so supportive of UK jobs.

[davepoth]

///ajd said:

Yes, interesting.

Bernard (Tory MP) is keen on just ditching our SM access deal and hoping for tariff free access to be agreed to - they'd be mad not to seems to be his angle. Again he tries to say tariffs would be good for our income - forgetting it would billions more cost to UK consumers. He's basically saying e.g. an equivalent to 30% VAT on cars would not matter as the govt wouldmake more.

Non-discretionary billions more into the pocket of the exchequer - so yes, probably quite good for the country all things considered. We need some more inflation to get the economy back onto an even keel.

///ajd said:

There is also the contradiction that trade deals with EU take ages, but some how the 28 new deals needed to keep car exports tariff free to EU countries will be a trivial matter done by lunchtime.

Only one deal required. Single market, innit? A deal with the EU should be very quick because we are already part of a tariff free area - the EU doesn't need to worry about how a tariff free area with the UK would affect trade, which is usually the biggest sticking point.

///ajd said:

He also just chucks financial passporting under the bus as if it doesn't matter at all. Might not the him. Nice of him to be so supportive of UK jobs.

It's probably less important than most make out; the UK has "critical mass" for financial services which would make it work even if passporting isn't allowed.

[jjlynn27]

davepoth said:

It's probably less important than most make out; the UK has "critical mass" for financial services which would make it work even if passporting isn't allowed.

Yes, they should probably listen to the guy who couldn't figure out that Swi is part of Schengen. Comedy gold.

[anonymous-user]

mondeoman said:

Greg66 said:

Interesting read here: https://medium.com/@theonlytoby/history-tells-us-w...

There's obviously much debate to be had around the minutiae, but in terms of "big picture" I think he has nailed it. How we get from where we are to the bad place that the author thinks is coming, and the precise causes of it aren't really going to matter a lot if that is where we end up.

If his thread is right, then brexit is just a minor piece in the overall puzzle - you could even run it back to Maastricht or earlier, because without that, brexit would'nt have happened...

Or even WWII - if Russia and the US had split the spoils differently, Germany perhaps wouldn't have become what it has etc etc etc.

I think that misunderstands his thesis.

[GoodOlBoy]

///ajd said:

If you left a golf club, they would hardly be bullying you if they said you couldn't play again without paying, would they?

The brexit "good deal" involves still playing at the golf club, for free, whilst ignoring all its rules on what guests are allowed.

With the notable exception of the EU when dealing with non-EU European countries, the usual idea of trade deals is to remove/ reduce tariffs and simplify trade between both parties for their mutual benefit.

Trade deals don't require FML, Immigration policy or golf. You portrayal is one-sided.

A trade deal with the EU will benefit both parties.

To reflect your analogy more accurately. A Brexit "good deal" allows more of them to play at our golf clubs than we do at theirs. Our golf clubs have rules too.

[///ajd]

GoodOlBoy said:

///ajd said:

If you left a golf club, they would hardly be bullying you if they said you couldn't play again without paying, would they?

The brexit "good deal" involves still playing at the golf club, for free, whilst ignoring all its rules on what guests are allowed.

With the notable exception of the EU when dealing with non-EU European countries, the usual idea of trade deals is to remove/ reduce tariffs and simplify trade between both parties for their mutual benefit.

Trade deals don't require FML, Immigration policy or golf. You portrayal is one-sided.

A trade deal with the EU will benefit both parties.

To reflect your analogy more accurately. A Brexit "good deal" allows more of them to play at our golf clubs than we do at theirs. Our golf clubs have rules too.

But the golf club with 500million members already has set its rules and says it doesn't want to change them. The rules are also set for visitors who are not in the club, these include tariffs. They are saying they don't want to change those rules either.

Maybe they are just lying and they will bend all the rules for an ex-member who used to pay green fees of £8bn year but now wants to play the same matches without paying anything. Sounds like a great deal for the EU, they'll give up without any compromise.....

[Jockman]

It will be interesting to see how regional elections go in Germany in September.

[GoodOlBoy]

///ajd said:

But the golf club with 500million members already has set its rules and says it doesn't want to change them. The rules are also set for visitors who are not in the club, these include tariffs. They are saying they don't want to change those rules either.

Maybe they are just lying and they will bend all the rules for an ex-member who used to pay green fees of £8bn year but now wants to play the same matches without paying anything. Sounds like a great deal for the EU, they'll give up without any compromise.....

But the EU doesn't apply the same rules to trade deals with non-European countries. Aside from anything else they'd never get away with it.

So in effect they have changed the rules, or rather they haven't applied them to other trade deals. Once outside the EU why should the UK be treated any differently ?

Irrespective of fees and political policies, the EU actually benefits more than the UK from tariff-free trade, it is a great deal for them and one they're desperately trying to negotiate with Canada and the USA.

I'm not saying it will happen, merely that applying FML and other political requirements to trade deals isn't the way for the EU to go.

The whole reason for FML and many of the EU laws and policies is to facilitate "ever closer union" . For any country outside the EU it simply doesn't make sense to insist on compliance with policies that add no value to trading partnerships.

[Derek Smith]

davepoth said:

///ajd said:

Ah OK. Still a huge export issue.

I'd agree Scotch is in a unique position, not so sure about the rest. They must be worrying for a reason, unless you think its just made up and belings in the brexcuse thread.

The problem for farmers is that without the CAP they are all (and I really mean that) bankrupt. Farm gate prices go nowhere near covering their costs, so they rely on the EU and on diversified income streams.

The NFU did a really good study into the possible effects of Brexit before the referendum, it's still worth a read.

http://www.nfuonline.com/nfu-online/news/nfu-repor...

They came out for remain in the end but it was by no means cut and dried.

Every farm round my way had Leave posters wherever they faced main roads. My elder son came to visit about 6 weeks before the vote and was stunned. He thought that farmers might lose some of the subsidy they enjoyed. Go back to pre Common Market and farmers were struggling.