Perhaps in my previous article I missed a key reason why Brexit might prevent further referendums. Recently data came out that suggests Brexit may have lowered pressure for Danish exit. Although the fact that Leave won shows that Leave could win, and may apply stronger pressure from the fringes for a referendum, it does show the perhaps less enthusiastic median voter that voting to leave the EU doesn’t leave to instantaneous puppies and sunshine. Uncertainty has led to a stark example. No longer does one need to point to “experts” when one can point to the news. One can look across the continent and say silly Brits, but ultimately the mess that Brexit has caused thus far appears pretty odious. While those already sure that the EU is the cause of their problems who are already pushing for exiting the EU, this won’t deter them. But to the undecided center this concrete example of what uncertainty means may push them to vote for the safe option. It was expected the British would, and they didn’t, but a concrete warning of substantial magnitude may at least prevent referendums and delay or ward off the sort of catastrophic collapse a Frexit may cause.
Nonetheless, I’m not convinced that this sort of fear will actually solve any of the structural problems the EU faces.
As an aside, two main consequences of Brexit and its uncertainty seem to be widely misinterpreted:
Uncertainty leads to less investment. Less investment hurts future growth. This is a fairly basic tenet of most economics and has generally played out, but to the average voter this means nothing. They may claim that uncertainty leading to hurt growth is just scaremongering, but it’s quite backed by evidence.
The FTSE 100 has gone up since Brexit. The fact that sterling was pummeled by Brexit helps exporters such as those in the FTSE 100 who are by and large multinational corporations. It hurts the common man whose earnings will buy less on the world market. The more domestically focused FTSE 250 has been hurt far worse due to its domestic focus lessening the impact of exchange rates, and hurting their ability to import goods. Add on top of that a large amount of uncertainty, and the FTSE 250 is still down 1300 points.
These sorts of interactions are fairly rudimentary and I’d hope that most journalists understand them, but they haven’t been widely reported at all. Whether this is due to poor journalism or a sense that the average person simply wouldn’t care or understand, I’m not sure.