Brexiteer fury at NBER report

The recent NBER report on the impact of Brexit has created quite a stir among the right-wing media. First, Ryan Bourne at The Times admitted that Brexiteers need to acknowledge the cost of Brexit. Bourne is one of the Economists for Brexit, but now says “we cannot pretend things have gone well so far.”  And a few days ago, a columnist at The Telegraph went further and declared: Time to admit the truth: Brexit has been an unmitigated economic failure.  It must be said that Jeremy Warner is not a Brexiteer. He is an assistant editor, writing on business and economic matters but, unlike most of the other assistant editors (and there are quite a few), he has never been keen on Brexit.

His latest effort was published on Saturday. Some folks on social media seem to think this marks a turning point for The Telegraph, but I’m afraid it’s nothing of the sort. It's just a little surprising the editor allowed it to go out with the rather provocative title. And note that it's free to read, no paywall. 

Perhaps they're rolling the pitch for a full mea culpa.  We can only hope.

All we need now is for Alex Brunner at The Daily Mail to admit he, too, was wrong about Brexit. But that’s for another day, perhaps.

Bourne and Warner both refer explicitly to the recent NBER report (see HERE), which delivered a hammer blow against the economic arguments for Brexit, finding the negative impact on GDP is twice the 4% that the OBE has been sticking to and has come ten years earlier than HM Treasury forecast back in 2016. The 6-8% loss of GDP has impacted this year, not in 2035, and has cost us close to £100 billion in lost tax revenue. No wonder Reeves is struggling.

Brexiteers are finding the report difficult to refute as biased or not credible. It represents serious, solid research and builds on a mountain of other academic work from a variety of different and independent sources. It also uses five different methods and finds that all of them point to a similar level of damage.

Warner, while pushing back a little on the reported 8% figure, doesn’t dispute the overall impact, hence the title. He writes:

"…. the underlying substance of the NBER’s analysis is undeniable and – unlike most previous assessments – it carries more weight by drilling down at a micro level into what businesses say are the real-world consequences.

"The damage to trade intensity is the least of it, the writers conclude. Instead, the report highlights elevated uncertainty, reduced demand, diverted management time and increased misallocation of resources from the protracted nature of the Brexit process.

"This very much tallies with my own fears at the time of the referendum that the process would prove long, divisive and all-absorbing, depriving the political and business class of the energy needed for almost anything else. So it proved.

"One might argue that these distractions are now largely behind us, allowing companies to focus on opportunities rather than obstructions. But if so, it doesn’t seem to have improved the outlook much. Nobody anticipates rip-roaring growth."

The NBER had access to data from the 7,000 UK firms on the Bank of England's Decision Makers Panel. They do rely on some complex maths at times, but backed up by polling and anecdotal evidence.

And Warner goes on:

"If Brexit was supposed to be a moment of national economic renewal, it has comprehensively failed to deliver as it was supposed to. Maybe the OBR is being too pessimistic in downgrading its medium term forecast for productivity growth to just 1pc a year – but even with the wonders of AI, I wouldn’t bank on it.

"Despite the downgrade, it is at the top end of most outside assessments and may therefore prove too optimistic."

However, as so often with The Telegraph, it’s not so much the article as the furious comments underneath, of which, when I looked in the last hour, had reached almost 3,800. Having been fed a diet of lies and misinformation for years and years, readers struggle to comprehend what they’re being told. 

Reality is forcing its way into their consciousness, and many obviously can’t cope.

I suspect none of the pro-Brexit readers will have bothered to read the NBER report that Warner refers to.  They simply refuse to accept Brexit has been a failure so far, and there is zero evidence that anything will change in the medium term.  This is one response:

This is a common theme. Brexit has been sabotaged by .. well, just about everybody really, except those 'true patriots' who voted for it without the slightest thought, even though they were warned it would lead to everybody being "substantially worse off" (Treasury 2016), and it being Putin's dream of dividing Europe.  Do these people ever listen to themselves I wonder?

And here's one who clearly likes banging his head against a brick wall:

 

You won't need to guess one of the most popular solutions being advocated. Yes, let Nigel Farage have a go: 

Brexit has killed the Tory Party. It is now stalking Labour, and when (or if) Farage gets into No 10, it will consume him as well. After that, I'm not sure who they will turn to?

The Brexiteers that subscribe to The Telegraph are part of the 30% of the population who will never, ever accept that Brexit has failed. Even if we are all forced to live in shanty towns, eating grass and berries, washing our clothes by bashing them against rocks while crouched at the side of polluted rivers, and using stone axes to chop firewood, they will insist Brexit hasn't been implemented properly.

It's a cult now.