logo
Brexit: why the UK economy hasn't led to buyer's remorse
  • 08 January, 2018

We’ve all been there: that moment when you get home and realise you didn’t want that new jumper and couldn’t really afford it either. It is known as buyer’s remorse, and it was a concept that gave the remain camp comfort as it reeled from the shock of defeat in the EU referendum vote in June 2016.

In the context of Brexit, buyer’s remorse meant that people who had voted to leave would quickly regret what they had done because the economy would plunge instantly into the stonking recession predicted by the Treasury in the run-up to the plebiscite. Project Fear was actually Project Reality, it was said, and before too long Brexit voters would be clamouring for the chance to think again.

No question there were those in the remain camp who, despite the obvious flaws in the European project, genuinely thought nothing good could ever come of Brexit and it would be the poor and the vulnerable who had voted leave who would suffer most from what they saw as its inevitable baleful consequences. There was, though, a snobbish and nasty subtext to the buyer’s remorse theory, which was that the plebs were too dumb to know what they were voting for.

Yet it was always a long shot that a second referendum would come about by these means and so it has proved. Eighteen months on and there has been little sign of buyer’s remorse.

In part, that is because people voted remain or leave in the referendum for complex reasons. The referendum was never just about economics, and in retrospect it was a strategic blunder on the part of the remain camp to fight only on what the vote would mean for GDP per head and house prices.

Another reason why buyer’s remorse has not set in is that the country – or rather the part of the country (by far the bigger part) that is not obsessed with Brexit – has moved on. There are Brexit fanatics, there are remain fanatics, and in between there are millions of people who were asked for a decision in June 2016, made it and now expect democracy to take its course. They have switched off from Brexit in just the same way that they switch off from politics between general elections.

But buyer’s remorse strategy required the UK to fall into recession and it has not come remotely close to doing so. The economy’s performance has been lacklustre – especially in comparison with other major developed countries – but buyer’s remorse would have required the economy to contract sharply and for unemployment to rocket. Something equivalent to 2009 – when the economy shrank by more than 4% – might have done the trick. Instead of which the economy is growing slightly below its long-term trend and unemployment has fallen to a 42-year low. The absence of economic Armageddon has simply reinforced the lack of trust in expert forecasters.

The stickiest patch for the economy since the referendum was in the first half of 2017, when inflation rose sharply as a result of the depreciation of the pound triggered by the Brexit vote, and even then growth averaged 0.3% a quarter. Since then, things have picked up a bit and, with inflationary pressures abating activity, is likely to remain reasonably firm in 2018. Expectations for the global economy are being revised up and that will help UK exporters of both manufacturing goods and services. Some of the exuberance in stock markets is froth, but one thing can be said with confidence: 2018 is not going to be another 2009. The tide turned for the global economy around the time of the Brexit vote and the upswing will continue for some time yet.

There are a few reasons for the changed mood. Prolonged stimulus in the form of record-low interest rates and the money-creation process known as quantitative easing has been one factor. Another has been the improved financial position of the banks. A third has been the natural rhythm of the business cycle, which means that even cautious firms have to start investing because their existing equipment packs up or becomes obsolete. For all these reasons, animal spirits started to revive. Firms that had made it through the Great Recession decided that things were going to get better rather than worse. They got fed up with being fed up.

This does not mean that the world has been magically transformed and that all the problems that have dogged the past decade have magically gone away. Far from it. Those deep structural problems – the over-reliance on debt to support consumption, a lost decade of productivity growth, growing income inequality – have not gone awayand are merely being disguised by a strong cyclical upturn. A period of solid growth creates a more benign climate in which some of those weaknesses can be addressed. It remains to be seen whether the opportunity is taken.

That is particularly true of Britain where the big story of the past decade has been dismal productivity. Had growth in output per head since 2008 continued on its pre-recession trend, living standards would be about 20% higher by now. Not even the most pessimistic predictions for the long-term impact of Brexit expect it to be that costly.

All of which brings us to the final problem with the buyer’s remorse theory: its proponents have spent so much time banging on about how terrible Brexit will be that they have neglected to come up with any solutions for tackling the reasons people voted for Brexit in the first place: low wages, job insecurity, the feeling that they were not being listened to. Remainers have latched on to any piece of negative economic news – no matter how trivial – in the hope that this will lead to change of heart among leave voters. But they have struggled to sketch out a plan for dealing with Britain’s structural economic problems, which were there before 23 June 2016 and will still be there whether or not the referendum result is overturned.

Constantly accentuating the negative without coming up with any solutions to Britain’s chronic balance of payments deficit, its north-south divide and its reliance on debt-fuelled growth has helped create the impression that some remainers would welcome a stiff recession because it would bring voters to their senses.

Remainers do themselves no favours when they over-hype the bad economic news. They may be better off pointing out that the part of the global economy that most outperformed expectations in 2017 was the eurozone and that Mario Draghi has done a brilliant job as president of the European Central Bank in disguising the single currency’s innate flaws. The UK economy will do better than expected in 2018. That it will do better partly as a result of a stronger eurozone is one of life’s ironies.

Article from 'theguardian'

Post a comment

To post a comment you must be registered. If you are already registered you can login.

Register

Tick this box to indicate that you have read and understood the terms and condition of the Privacy Policy

Privacy Policy

BACKGROUND:

User understands that your privacy is important to you and that you care about how your personal data is used and shared online. We respect and value the privacy of everyone who visits this website, www.well-tax.com (“Our Site”) and will only collect and use personal data in ways that are described here, and in a manner that is consistent with Our obligations and your rights under the law.

Please read this Privacy Policy carefully and ensure that you understand it. Your acceptance of Our Privacy Policy is deemed to occur upon your first use of Our Site. If you do not accept and agree with this Privacy Policy, you must stop using Our Site immediately.

1. Definitions and Interpretation

In this Policy, the following terms shall have the following meanings:

“personal data”

means any and all data that relates to an identifiable person who can be directly or indirectly identified from that data. In this case, it means personal data that you give to Us via Our Site. This definition shall, where applicable, incorporate the definitions provided in the EU Regulation 2016/679 – the General Data Protection Regulation (“GDPR”); and

“We/Us/Our”

means WellTax Limited, a limited company registered in England and Wales under company number 09572130 whose registered address is 402a City Gate House, 246-250 Romford Road, London E7 9HZ.

2. Information About Us

• Our Site is owned and operated by WellTax Limited, a limited company registered in England and Wales under company number 09572130 whose registered address is 402a City Gate House, 246-250 Romford Road, London E7 9HZ.

• Our VAT number is GB 221 1287 52.

• Our Data Protection Officer is WellTax Limited and can be contacted by email at info@well-tax.com, by telephone on +44 (0) 20 3581 1717, or by post at https://well-tax.com/contact.

• We are regulated by the ICO (Information Commissioner’s Office, https://ico.org.uk/).

3. What Does This Policy Cover?

This Privacy Policy applies only to your use of Our Site. Our Site may contain links to other websites. Please note that We have no control over how your data is collected, stored, or used by other websites and We advise you to check the privacy policies of any such websites before providing any data to them.

4. Your Rights

• As a data subject, you have the following rights under the GDPR, which this Policy and Our use of personal data have been designed to uphold:

• The right to be informed about Our collection and use of personal data;

• The right of access to the personal data We hold about you (see section 12);

• The right to rectification if any personal data We hold about you is inaccurate or incomplete (please contact Us using the details in section 13);

• The right to be forgotten – i.e. the right to ask Us to delete any personal data We hold about you (We only hold your personal data for a limited time, as explained in section 6 but if you would like Us to delete it sooner, please contact Us using the details in section 13);

• The right to restrict (i.e. prevent) the processing of your personal data;

• The right to data portability (obtaining a copy of your personal data to re-use with another service or organisation);

• The right to object to Us using your personal data for particular purposes; and

• Rights with respect to automated decision making and profiling.

• If you have any cause for complaint about Our use of your personal data, please contact Us using the details provided in section 13 and We will do Our best to solve the problem for you. If We are unable to help, you also have the right to lodge a complaint with the UK’s supervisory authority, the Information Commissioner’s Office.

• For further information about your rights, please contact the Information Commissioner’s Office or your local Citizens Advice Bureau.

5. What Data Do We Collect?

Depending upon your use of Our Site, We may collect some or all of the following personal data:

• name;

• date of birth;

• gender;

• business/company name;

• job title;

• profession and studies;

• contact information such as email addresses and telephone numbers;

• demographic information such as post code, preferences, and interests;

• IP address;

• web browser type and version;

• operating system;

• a list of URLs starting with a referring site, your activity on Our Site, and the site you exit to;

6. How Do We Use Your Data?

• All personal data is processed and stored securely, for no longer than is necessary in light of the reason(s) for which it was first collected. We will comply with Our obligations and safeguard your rights under the GDPR at all times. For more details on security see section 7, below.

• Our use of your personal data will always have a lawful basis, either because it is necessary for Our performance of a contract with you, because you have consented to Our use of your personal data (e.g. by subscribing to emails), or because it is in Our legitimate interests. Specifically, We may use your data for the following purposes:

• Supplying Our services to you (please note that We require your personal data in order to enter into a contract with you);

• Personalising and tailoring Our services for you;

• Replying to emails from you;

• Supplying you with emails that you have opted into (you may unsubscribe or opt-out at any time by sending an email to info@well-tax.com specifying that you no longer want us to keep your data;

• Market research;

• With your permission and/or where permitted by law, We may also use your data for marketing purposes which may include contacting you by email, telephone, text message, and post with information, news, and offers on Our services. We will not, however, send you any unsolicited marketing or spam and will take all reasonable steps to ensure that We fully protect your rights and comply with Our obligations under GDPR and the Privacy and Electronic Communications (EC Directive) Regulations 2003.

• You have the right to withdraw your consent to Us using your personal data at any time, and to request that We delete it.

• We do not keep your personal data for any longer than is necessary in light of the reason(s) for which it was first collected. Data will therefore be retained for the following periods (or its retention will be determined on the following bases):

• In the “Newsletter Section” data will be kept for an unlimited period, however, an unsubscribe option will be available for the individual that would like to opt out.

• In the “Post a Comment Section” data will be kept for an unlimited period, however, the individual could always unsubscribe by sending an email to info@well-tax.com.

• In the “Contact Us”, “Get in Touch” and “Careers” section data will be kept for two years, allowing Welltax Limited to have a reasonable amount of time to contact potential customers and employees.

7. How and Where Do We Store Your Data?

• We only keep your personal data for as long as We need to in order to use it as described above in section 6, and/or for as long as We have your permission to keep it.

• Your data will only be stored in the UK.

• Data security is very important to Us, and to protect your data We have taken suitable measures to safeguard and secure data collected through Our Site.

• Steps We take to secure and protect your data include:

• Encrypted Hard Disc Data

• Website Control Panel locked with password

8. Do We Share Your Data?

• Subject to section 8.2, We will not share any of your data with any third parties for any purposes.

• In certain circumstances, We may be legally required to share certain data held by Us, which may include your personal data, for example, where We are involved in legal proceedings, where We are complying with legal obligations, a court order, or a governmental authority.

9. What Happens If Our Business Changes Hands?

• We may, from time to time, expand or reduce Our business and this may involve the sale and/or the transfer of control of all or part of Our business. Any personal data that you have provided will, where it is relevant to any part of Our business that is being transferred, be transferred along with that part and the new owner or newly controlling party will, under the terms of this Privacy Policy, be permitted to use that data only for the same purposes for which it was originally collected by Us.

• In the event that any of your data is to be transferred in such a manner, you will not be contacted in advance and informed of the changes.

10. How Can You Control Your Data?

• In addition to your rights under the GDPR, set out in section 4, when you submit personal data via Our Site, we aim to give you strong controls on Our use of your data for direct marketing purposes (including the ability to opt-out of receiving emails from Us which you may do by unsubscribing using the links provided in Our emails and at the point of providing your details).

• You may also wish to sign up to one or more of the preference services operating in the UK: The Telephone Preference Service (“the TPS”), the Corporate Telephone Preference Service (“the CTPS”), and the Mailing Preference Service (“the MPS”). These may help to prevent you receiving unsolicited marketing. Please note, however, that these services will not prevent you from receiving marketing communications that you have consented to receiving.

11. Your Right to Withhold Information

You may access certain areas of Our Site without providing any data at all. However, to use all features and functions available on Our Site you may be required to submit or allow for the collection of certain data.

12. How Can You Access Your Data?

You have the right to ask for a copy of any of your personal data held by Us (where such data is held). Under the GDPR, no fee is payable and We will provide any and all information in response to your request free of charge. Please contact Us for more details at info@well-tax.com, or using the contact details below in section 13.

13. Contacting Us

If you have any questions about Our Site or this Privacy Policy, please contact Us by email at info@well-tax.com, by telephone on +44 (0) 20 3581 1717, or by post at https://well-tax.com/contact. Please ensure that your query is clear, particularly if it is a request for information about the data We hold about you (as under section 12, above).

14. Changes to Our Privacy Policy

We may change this Privacy Policy from time to time (for example, if the law changes). Any changes will be immediately posted on Our Site and you will be deemed to have accepted the terms of the Privacy Policy on your first use of Our Site following the alterations. We recommend that you check this page regularly to keep up-to-date.

Login
Let us keep you updated with our Newsletter