Tag Archives: Brexit

Surviving 2017 – a user’s guide

The Conversation

Brian McNair, Queensland University of Technology

At the peak of post-Soviet triumphalism in the west, amid all the hype about a New World Order and the end of history, historian Eric Hobsbawm rained on the parade somewhat by suggesting that we were in a pre-war, rather than post-(Cold) war period.

Hobsbawm was a Marxist, deeply concerned by what he saw even then, more than two decades ago, as the rise of nationalism and religious extremism.

The ideological vacuum left by the demise of the USSR and the broader decline of socialism was in danger of being filled by tribalism, sectarianism and ethnic conflict. Long dormant hatreds of “the Other” founded on reactionary creeds of racial and religious supremacy would now have room to breathe, he believed.

He didn’t live to see that prediction fulfilled, but as we leave 2016 behind and the world prepares for a Trump presidency built on white rage, it is clear that we are there.

The Long Peace which has lasted since 1945 – no wars between major powers, no world wars after the two that defined the 20th century, and despite the horrors of civil war such as we see in Syria today, no human casualties on the scale of 1939-45 or 1914-18 – is coming to an end.

Russia hacks US elections, and invades sovereign nations in Eastern Europe. China steals US drones in international waters, and builds military bases on artificial islands. The soon-to-be commander-in-chief of America writes this is “unpresidented” (sic), while endorsing the behaviour of the murderous president of the Philippines, Rodrigo Duterte. And all this before Donald Trump even gets his greedy fingers on the nuclear button.

All it will take for this bizarre mix of post-factual ignorance, nationalism and religiously fuelled aggression to become full-on war is one provocative move too far, by one side or another.

It might happen in the illegal Israeli settlements next week, or around Taiwan in June. Maybe Trump will take a shot at North Korea. Who knows?

We do know that we have a tax-avoiding, pussy-grabbing reality TV star for president of the United States, who communicates his foreign policy on social media while proclaiming he has no need for such trivia as CIA national security briefings.

And if we manage to avoid that apocalyptic scenario, we will still have to deal with nationalism tearing apart the UK, the EU, and all the gains of internationalism, globalisation and multiculturalism we have painstakingly made since the cataclysm of the second world war.

The English artists Gilbert & George produced a prescient 2014 piece seen by this writer at MONA in Hobart. It declares:

Our grandparents didn’t vote for fascists. They shot them!.

Well, now they’re voting for them again – in Austria, the UK, Australia, the US, even Germany, where neo-nazism is on the verge of again becoming respectable.

We are in an historical moment never experienced by anyone born after 1945. A moment unforeseen and unprepared for.

In that respect I am guilty.

Yes, like most observers I understood that Brexit was a possibility, given the polls showing a slight majority for Remain right up to the end of the campaign. But the wishful thinker in me chose to believe that no rational person would wish to tear up the complex web of relationships between Britain and the EU, formed over 45 years, and which had contributed so much to peace and prosperity on the continent.

Sure, the EU had its problems and challenges, but nothing a determined UK government could not have resolved through firm negotiation of the type pursued by Conservative and Labour administrations for decades. To destroy the entire edifice of economic, cultural and political union between 28 countries was masochistic and self-destructive, surely?

The Scots had rejected separation from the UK just two years before, after all, a very similar issue to that pushed by the English nationalists in the EU referendum.

What we see now with the chaos and uncertainty of Brexit would have been visited on the UK in 2014, if the separatists had won the referendum – ironically, the Scottish nationalists now cite Brexit as their reason for overturning the democratic vote for Union.

My Scottish countrymen and women made the right call there, and maybe that encouraged me to think the Brits would do so in relation to the EU, and then the Americans would elect a principled and experienced public servant such as Hillary Clinton over the mean-minded man who will soon be sitting in the Oval Office.

In the US election, again, the data showed that a Trump victory was possible, if not likely. No-one, not even Nate Silver and those at FiveThirtyEight, wanted to believe the data could all be wrong, even if we knew on recent evidence that they might be.

But we were wrong, very wrong, and now we face the most serious threat to all of our livelihoods and lives – wherever in the word we call home – most of us have known. Unless you are a rich billionaire such as Trump and his super-rich cronies, it’s time to dig in and prepare for a future of chaos and austerity.

Our grandparents DID shoot fascists, and they did win the war. We 21st-century anti-fascists can prevail too, but only if we understand the enormity of what we face.

This is a culture war, first.

As I observed in Porno? Chic! three years ago there is a global reaction underway to the historic gains of feminism and gay rights, spearheaded by radical Islam and now hijacked by the white supremacist alt-right. In what remains of the liberal capitalist world we must defend and promote progressive sexual politics as never before.

We must defend multiculturalism and the values of tolerance, against not just the white nationalists but the Islamists and haters of every type.

If our leaders had been more honest about and resistant to Islam’s assault on our progressive social values we might not be where we are today, in the UK, the US, France, Germany, Australia (where One Nation is preparing to seize its historic opportunity).

We must declare zero tolerance for religious, nationalist, and ethnic intolerance, from whichever direction it comes.

We must learn to fight the alt-right with the same ferocity and fearlessness they apply to their enemies in the media, academia, everywhere.

Forget politeness, or all known rules of online etiquette. Forget turning the other cheek, or trying to be reasonable with those who ignore the facts in the hope they will be persuaded to your point of view. Challenge them now, because the deplorables will be coming for you next.

The internet is now a target, so we must relearn how to live without the digital, and how to survive when the network gets hacked or knocked out by Russia or China (or indeed Trump).

As we have just seen in the starkest possible manner, our liberal democracies have become extremely vulnerable not just to demagogues spouting populist bile on social media, but to foreign state hacking.

It’s clear that when the Long Peace does end, the internet will be taken out first. We should all be prepared to survive the abrupt withdrawal of online services which we have become reliant on.

But look on the bright side.

Buy a turntable and some vinyl records; a nice pen that you can write with, and some notepads. Start reading hard copy books again. Reduce your dependence on the digital. Rediscover the pleasures of the analogue.

Such survival tactics won’t stop what’s coming after January 20, but they might make it just that bit easier to cope. Meantime, as we approach the new year and say farewell to Barack Obama, let’s echo his sentiments of this week:

God bless us all.

The ConversationBrian McNair, Professor of Journalism, Media and Communication, Queensland University of Technology

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

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Brexit stage right: what Britain’s decision to leave the EU means for Australia

The Conversation

Ben Wellings, Monash University

Britain’s decision to leave the European Union has opened a fundamental crack in the western world. Australia’s relationship with the United Kingdom is grounded in the UK’s relationship with the EU.

Given Australia’s strong and enduring ties with the UK and the EU, the shockwaves from this epoch-defining event will be felt in Australia soon enough. Most immediately, the impending Australia-EU Free-Trade Agreement becomes more complicated and at the same time less attractive.

What will happen to trade ties?

The importance of Australia’s relationship with the EU tends to get under-reported in all the excitement about China. We might ascribe such a view to an Australian gold rush mentality. Nevertheless, Australia’s trading ties to the EU are deep and strong.

Such ties looked set to get stronger. In November 2015 an agreement to begin negotiations in 2017 on a free-trade deal was announced at the G20 summit in Turkey. Trade Minister Steven Ciobo said in April 2016 that an Australia-EU free trade agreement:

… would further fuel this important trade and investment relationship.

When considered as a bloc, the EU consistently shows up as one of Australia’s main trading partners. Consider the statistics below:

  • in 2014 the EU was Australia’s largest source of foreign investment and second-largest trading partner, although the European Commission placed it third after China and Japan in 2015;
  • in 2014, the EU’s foreign direct investment in Australia was valued at A$169.6 billion and Australian foreign direct investment in the EU was valued at $83.5 billion. Total two-way merchandise and services trade between Australia and the EU was worth $83.9 billion; and
  • the EU is Australia’s largest services export market, valued at nearly $10 billion in 2014. Services account for 19.7% of Australia’s total trade in goods and services, and will be an important component of any future free trade agreement.

This is all well and good. But when not considered as a bloc, 48% of Australia’s exports in services to the EU were via the UK; of the $169 billion in EU foreign direct investment, 51% came from the UK; and of Australia’s foreign direct investment into the EU, 66% went to the UK.

You get the picture.

The UK was Australia’s eighth-largest export market for 2014; it represented 37.4% of Australia’s total exports to the EU. As Austrade noted:

No other EU country featured in Australia’s top 15 export markets.

In short, the EU is not as attractive to Australia without Britain in it.

Beyond trade numbers

But the Australia-EU-UK relationship cannot be reduced to numbers alone. It also rests on values shared between like-minded powers.

Brexit represents the further fracturing of the West at a moment when that already weakening political identity is in relative decline compared to other regions of the world, notably Asia (or more specifically China).

EU-Australia relations rest on shared concerns such as the fight against terrorism advanced through police collaboration and the sharing of passenger name records. The EU and Australia also collaborated to mitigate climate change at the Paris climate summit. And they work for further trade liberalisation in the World Trade Organisation – but don’t mention agriculture.

Without the UK, these shared political tasks become harder.

Clearly, Australia-UK relations rest on a special historical relationship. However, it has seen efforts at reinvigoration, as British governments buckled under the pressure of the Eurosceptics among the Conservatives.

David Cameron addresses the Australian parliament in 2014.

Beyond everyday trade, historical links have been reinforced through the centenary of the first world war and the UK-Australia commemorative diplomacy that has come with this four-year-long event.

Cultural ties are most regularly and publicly affirmed through sporting rivalries such as netball, rugby and most notably cricket. Expect these ties to be reinforced as the UK seeks trade agreements and political support from its “traditional allies”.

For those with British passports, there will be a two-year period of grace as the UK negotiates its exit. After that, it will be quicker to get into the UK at Heathrow, but this might be small consolation for the loss of a major point of access to the EU.

The vote to leave is a major turning point in Europe’s history. It marks a significant crack in a unified concept of “the West”. It is not in Australia’s interests.

It’s time for Australia to make new friends in Europe.

The ConversationBen Wellings, Lecturer in Politics and International Relations, Monash University

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

 

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How a Brexit could impact on Australia

The Conversation

Lee Smales, Curtin University

The outcome of the British vote to leave or remain in the European Union (EU) will be known in Australia around 2pm on Friday.

Since becoming a member of the EU in 1973, Britain’s relationship with Europe has been fraught. The “remain” camp has focused on the positives to trade and investment of maintaining EU membership. And the “pro-Brexiters” have concentrated on the perceived loss of sovereignty, undue regulation, and lack of immigration controls that this brings.

Brexit would bring extreme short-term volatility…..

In the short-term, Brexit would lead to turmoil in the UK and global financial markets. In the worst-case scenario it may precipitate another financial crisis.

With a debt mountain piling up in China even as growth slows, and the developed world struggling to generate growth despite record-low interest rates, the global economy is fragile. Last week, the US Federal Reserve cited the uncertainty around Brexit as one reason for leaving interest rates unchanged.

The effect will be most keenly felt in the foreign exchange market. The trade-weighted-index for the British pound has depreciated by 6.5% this year, and currently appears to be moving in step with Brexit polling. US investor George Soros, who famously “broke” the Bank of England during the 1992 European Exchange Rate Mechanism “Black Wednesday” crisis, suggests Brexit would cause a Sterling devaluation of at least 15%.

Chance of ‘Brexit’ is impacting the value of the Pound
FT Research and Bank of England

……and longer term uncertainty

The long-term effects of Brexit are uncertain. Much will depend on the negotiations between the EU and UK surrounding the conditions of exit. This could take years.

Since around half of UK trade is with the EU, it is likely that the government will seek to follow the example of Norway and Switzerland in retaining the benefits of a free trade zone without EU membership – however this is far from guaranteed. The Norwegian prime minister Erna Solberg suggested that Britons won’t like this since “Brussels will decide without the Brits being able to participate in the decision-making”.

Crucially, this uncertainty will mean that business decisions are deferred and investment delayed. This may result in many firms deciding to take their operations elsewhere. The Bank of England has suggested that Brexit will stoke inflation and raise unemployment, potentially tipping the UK into recession.

Of greater concern are the potentially greater geopolitical risks if other countries follow Britain’s lead and seek to leave the EU. The Eurosceptic political parties of the far-right have surged in popularity in recent years, and would surely push for their own countries to exit. This could mean a disintegration of the EU.

Consequences for Australia

As they are closely linked, turmoil on offshore markets will likely have a large impact on Australian markets. Australian stock markets and the Australian dollar tend to decline sharply as uncertainty increases and investors adopt a “risk-off” mentality. Bond yields will also head even lower as investors engage in a “flight to quality”.

If financial markets seize up, as they did in 2008, then the big Australian banks will find it difficult to secure the vast amounts of offshore funding that they require – share prices will fall sharply and government guarantees will be called for again. The one bright spot could be the stock price of gold mining firms if gold surges as a result of its “safe haven” status as it did in 2008.

A fall in the pound would have negative consequences for the many Australians (such as myself) who have pensions and other assets in the UK. And the spending power of British tourists (last year more than 700,000 of them arrived in Australia) would be lowered.

In the longer term, it is likely that a shaky global economy will severely impact Australia’s trade. Exports have been a key driver of recent GDP growth and so this could have severe ramifications for employment and economic growth. Recall that commodity prices sank quickly in 2008, and also that the UK is still Australia’s 7th largest trade partner.

As with the majority of governments, the lack of desire in promoting structural change, means that Australia’s fiscal position provides little comfort in the ability to stimulate growth. A repeat of 2008-09 when Australia avoided recession is unlikely to be avoided.

Not for the fainthearted

Of course, Brexit is far from certain to occur. If the bookmakers are correct (and they have form) and Britain remains in the EU we should see a rosier picture develop. At least in the short-term, a “relief rally” would likely see global stock markets surge higher along with the British pound (and the Australian dollar).

This “binary” effect, where prices are expected to advance/decline sharply, is one reason why investment in financial markets is certainly not for the fainthearted right now.

In the longer-term, a resolution to the UK’s position in Europe will do little to change the developing situation in China, or the re-balancing of Australia’s economy in the aftermath of the mining boom.

The ConversationLee Smales, Senior Lecturer, Finance, Curtin University

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

 

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