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Britain quits Europe, Cameron his office, global markets in free fall


Voters from both camps in London. Reuters Voters from both camps in London. Reuters

Britain has voted to leave the European Union — and put a question mark over its future, the unity of Europe, political discourse in the West and its global economic fallout.

Its stunning decision, upending most opinion polls, threatens to unravel the European project after World War II and shape the debate within a fractious continent. The Leave campaign won 52% to 48% after it tapped into a wave of anger and resentment in the face of fears it had stoked: deluge of immigrants, rising crime and terrorism, jobs being taken away.

After the historic Brexit referendum, Great Britain stands vertically divided. England and Wales rejected the European Union, while Scotland and Northern Ireland decided to remain in it.

London, the gold-plated financial capital of the world, voted for the EU, while the jobless and recession-hit midlands walked out of it. The elderly on the lengthening National Health Service waitlists abandoned the continent, while job-seeking university graduates voted to stay within it.

 

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Though these divisions were apparent, few expected the drama that unfolded late in the night. And in this the beauty — to those who lost, the frightening beauty — of democracy, it was clear. People play the ultimate puppeteer proving pundits, pollsters, bookies, bankers and markets wrong.

Initially, the scales tilted towards Remain. As polls closed, Nigel Farage, the outspoken leader of the Leave campaign, went to sleep conceding defeat. Two hours later, when gloom began to shroud the Remain camp, he miraculously walked back to “un-concede”, adding a new word to the political glossary.

Similarly, when polls closed last night, the pound surged ahead but this morning, it plummeted to almost 10%, its lowest level since 1985.

Financial markets were in free fall. George Soros, the world’s biggest currency trader, had earlier warned of the impending “Black Friday.” It began to unfold early in the morning. The Euro too had a nightmarish fall. European shares were down by 8% and the UK’s FTSE had the biggest ever one-day percentage fall by 8.5%.

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Banks were the worst sufferers. At one stage, Britain’s two biggest banks, Barclays and RBS, fell by about 30%. Bank of England governor Mark Carney was soon drafted to calm nerves. He promised to “take all necessary steps to meet its responsibilities for monetary and financial stability”. The BoE even promised to pump in up to £250 bn of additional funds to stabilise the markets.

Crucially, the younger generation largely opted to stay while the older generation wanted to leave. According to a poll by Ipsos MORI, around 52% of adults under 34 wanted to stay, while 31% in the same age group voted for a Brexit.

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In the same poll, 27% of voters above 55 chose Remain, while 29% in the age group opted for Leave. Older voters are more likely to be retired and on pension or other fixed income, which means they are insulated from short-term economic downturns caused by a Brexit. Younger voters have more to gain and lose from the economy’s performance — and from being able to freely work across Europe.

Many blamed Prime Minister David Cameron for this “reckless” upheaval — for putting such a complex question to a test so blunt and binary. It was indeed his gamble, now a huge miscalculation. He could have ruled the country for the next four years and with the opposition Labour Party in complete disarray under a left-leaning Jeremy Corbyn, he could have even won the next election.

Starting his journey into political wilderness, Cameron, accompanying his wife Samantha, came out of the famous black door of 10 Downing Street at 8.45 am. He assured the nation that the “will of the British people… must be delivered”.

A visibly heartbroken Samantha looked on as her husband conceded defeat. Cameron once again insisted: “I was absolutely clear about my belief that Britain is stronger, safer and better off inside the European Union…But the British people have made a very clear decision to take a different path.”

Cameron with wife Samantha at 10 Downing Street. AP Cameron with wife Samantha at 10 Downing Street. AP

Justifying his decision to call this referendum, he said he had “always believed we have to confront big decisions, not duck them”.

“I will do everything I can as prime minister to steady the ship over the coming weeks and months,” Cameron said. “But I do not think it would be right for me to try to be the captain that steers our country to its next destination.”
His voice quivered. But no, there were no tears as in November 1990, when Iron Lady Margaret Thatcher left Downing Street.

The leader of the Leave campaign and perhaps future prime minister Boris Johnson graciously paid tribute to Cameron, calling him “the most extraordinary politician of our time. It was his bravery that gave this country the first referendum on the EU in 43 years”.

UKIP’s Nigel Farage didn’t look so charitable. He was still scathing about Europe. “The Eurosceptic genie is out of the bottle, and it will not be put back,” he said. He seemed to be right. The slide is not going to stop here.

Up in the north, Scotland’s First Minister Nicola Sturgeon “deeply regretted” the decision. She said it was “democratically unacceptable” that Scotland, which voted to Remain, “faces the prospect of being taken out of the EU against our view”.

Sturgeon said the option of a second referendum on Scotland’s independence “must be on the table. We said clearly we do not want to leave the EU. I will do all it takes to ensure these aspirations are realised… An independence referendum is highly likely”.

brexit, EU referendum, european referendum, britain vote, UK vote, globalisation era, globalisation, global formation, Nandan Nilekani, world news, world market, world trade, global trade Crucially, the younger generation largely opted to stay while the older generation wanted to leave.

In France, Marine Le Pen, leader of the far-right National Front party, rejoiced at the Brexit vote. She said the vote is a “victory for freedom” and called for all countries to have referendums on their EU membership. There have already been calls for a “Dexit” from Denmark. Similar noises have been made in the past in Austria, Spain and Greece.

Though leaders of the Leave vote have assured help in the transition, no one is sure of how smooth it is going to be. If markets remain volatile and the economic slide continues, things could deteriorate further.

In the meantime, the Conservatives have to find a new leader. Though everyone is talking about Johnson being the new prime minister, Cameron loyalists may not forgive the former London Mayor.

The Conservatives have a history of not rewarding the hatchet man with the crown. After Thatcher, Lord Heseltine, the hatchet man, never got the job. And a young pretender John Major emerged as the new leader. So it is too early to tell who the new prime minister will be.

On the other hand, the opposition Labour party under Jeremy Corbyn looks fairly unelectable. Until now, Britain was at the crossroads. Now, the British politics is at the crossroads. The dark mood of the nation was summed up by the The Economist: “It would be bad for everyone if Great Britain shrivelled into Little England and be worse still it this led to Little Europe.”