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| The EMA might well be heading for Stockholm |
Plenty of people are still angry enough to argue about Brexit on Twitter. I came across an exchange between a UKIPer from Worthing and a remainer from Scotland. The kipper was demanding a concrete example of the harm Brexit was doing to the economy. The remainer was floundering a bit -she didn't seem to be as on top of the facts as the Brexiter was.
A tiny victory for the out camp is a trivial matter in the overall story of course, but it did get me thinking. We haven't worked out why the Roman Empire fell yet, so I think it will be a few centuries before the economic consequences overall of Brexit are worked out. It might be possible to conclude that one side or the other has the better arguments. But the world is simply too complicated to know what is going to happen as a result of any policy decision with any precision. The fall in the value of the pound for example might give the UK economy enough of a short time boost to overcome any later adverse effects. Or it might trigger a competitive devaluation from the Europeans that leaves the UK a smoking wasteland. I don't know. Neither does anyone else.
The reality is that anyone who is arguing for or against membership of the EU on economic grounds might well have strong and compelling reasons for what they believe. They might even be right in the sense that there may be nothing wrong with their reasoning if all the factors they aren't taking into account in their analysis don't actually matter that much. But there is no way of knowing if something that you haven't taken into account proves to be very important.
I should probably point out that I am pretty fallible myself. My Dad was travelling to Germany just after the referendum. He carefully changed his money well ahead of the vote in case of a fall in the pound. I pointed out that while what he was doing was sensible enough, the pound would fall in value as the result of a no vote, it would not matter in his case because the Euro would fall as well. I was sort of right - both did fall. But the pound fell a heck of a lot more. The old man enjoyed that. I might be the one with a science degree and he is the one who drove a lorry, but he had more nous than I did. Fair cop.
But there a few consequences where it is possible to point to unambiguous downsides for the UK. The biggest of these is the inevitable loss of the European Medicines Agency. This is a great centre for networking and is a real national asset, quite apart from it being the source for quite a lot of jobs. The UK's influence in the drug development industry - which is a very significant subset of the overall drug industry - is one of the things that gives the UK its strong economy. After all, what is an an economy other than the sum of all the things that the people in that economy do. Drugs are high value goods that take a lot of know how to make. Just the sort of product you need on a small island with lots of people but not many natural resources. I don't think that you can quantify just how valuable having the agency located in London is. But you can say that it is definitely high and it is definitely positive. I have wracked my brains but I cannot think of a single downside to having it, and lots of reasons to regret losing it.
In fact, given the uncertainty over any other economic consequence I would say that throwing the loss of the EMA into the balance is enough to trump any other economic consequence that can reasonably be foreseen. Ultimately Brexit is a gamble, and a gamble that might just pay off. But it is not one that doesn't involve risking a stake.
Incidentally, the Swedes seem to have got their act together quickly in the inevitable tussle over the future location of the EMA. I wish them well. It is a good fit for their economy and Stockholm is a good city to visit, especially in the summer.
http://www.government.se/press-releases/2016/12/swedish-campaign-for-relocation-of-the-european-medicines-agency-from-the-uk-to-sweden/
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