Brexit: What have we done?

Source: Wharton

Guest Blog by Phillip Warwick.

On 23^rd June, 16 million UK citizens voted to stay in the European Union (EU). That’s equivalent to population of the Netherlands.  Unfortunately, 17 million other UK citizens voted to leave the EU.  The vote has sent shock waves through universities in the UK.  Will international students still want to come to the UK?  Will faculty from EU countries need a visa in future?  What will happen to the Erasmus scheme in the UK? What about EU funding for research?  Will we still be able to afford to go on holiday in France, Spain and Italy?  All these questions have been discussed in subdued corridor conversations over the last couple of weeks.

Sitting in a Business School in the north-east of England, I feel that my academic colleagues and I need to speak-up in the national debate about how we arrived at this sorry state of affairs. It would of course be easier to fall into line and accept the received wisdom in the serious newsmedia that it was the fault of the self-serving politicians and ill-informed voters in the English provinces. I have heard this line at several meetings and HE conferences I have attended in the last couple of weeks.  Clearly politics has had a lot to do with it.  But we need to explain more clearly why we think a region like ours, the north-east of England (a region that has apparently benefited from all the EU has to offer) should vote so heavily against the EU and for Brexit? At first glance it does seem crazy.

I moved to the North-East of England in 1990. For those of you who don’t know it, think of the bridges over the River Tyne; think of Newcastle United, Sunderland and Middlesbrough football teams; think of the setting for film Billy Elliot and think of Durham Cathedral. The North-East of England is the bit south of Scotland and north of Yorkshire.  By 1990, the north-east’s coal mines had all but disappeared, the massive Consett steel works had shut down in 1989 and the shipyards of Newcastle and Sunderland were in terminal decline.  The old heavy industries that had made the North East relatively rich and powerful at the start of the twentieth century were by the end of the century all but gone.

However, there were signs of regeneration. Thanks to the European Regional Development and European Social Funds, infrastructure investment meant that a very good road network had been created criss-crossing the region.  EU subsidies meant that Japanese and Korean multinationals like Nissan, Fujistsu, Komatsu and Samsung set-up factories employing thousands of workers.  EU funds enabled One North East, a highly successful regional development agency, to fund a significant number of projects around the North-East including the creation of the iconic developments on the Newcastle/Gateshead quayside (The Baltic and The Sage) and the Teesdale Business Park, home to Durham University’s Queen’s Campus, on Teesside.

Despite all this benefit, with the exception of the affluent Newcastle suburbs, the whole of the North-East of England voted around 60/40 to leave the EU on 23^rd June.   Many of my neighbours, my wife’s work colleagues, some of my old school friends, the people I play golf and cycle with, the people at the gym, the customers at the paper shop, and hairdressers – all told me they were going to vote leave.  Vote leave supporters tended to be in their 40s or older, were less likely to have attended a higher education institution and were more likely to be from outside the main urban areas in England and Wales (they were also the most likely to make the effort to vote).  Remain supporters tended to be younger, better educated and were more likely to be from the main urban areas or they were from Scotland or Northern Ireland (and, especially the young, less likely to vote).

 

The Brexit vote was not just about the EU, it was arguably as much about an unfair distribution of wealth and power in the UK. It was a vote against the globalisation. A vote that hoped to turn the clock backwards. Those with degrees, good jobs, nice cars, nice houses and cultural capital voted to stay in the EU, to retain the 21^st century status quo.  Those who voted against were often the have-nots, the angry and those frightened by the globalised world.  David Cameron’s stupid idea for a referendum gave the angry, the frightened and the have-nots a single cause around which to unite.  Worried by the impact of globalisation, with a suspicion of outsiders (typical of much of rural England) and fuelled by a pack of lies from self-serving politicians who promised an end to mass immigration and divert EU funding to the health service.

The have-nots voted against the haves. They voted against David Cameron and George Osborn and their Tory government; they voted against all the self-serving political classes; they voted against bankers who crashed the economy in 2008, against Goldman Sachs, the hedge fund managers and the bosses of big business; they voted against the London centric media; they voted against the experts in the universities and they voted against the bureaucrats at the E.U. They voted against those who pay themselves vast salaries and those who they perceive to waste British tax payers money. The irony is, of course, that they were told to vote against all these things by three very rich men. Eton and Oxford educated, Boris Johnson, a privately educated, former stockbroker turned MEP, Nigel Farage and a US based, Australian media mogul, Rupert Murdoch (none of these three villains have any role in sorting out the mess they helped to get the country into).

Source: The Gaurdian

Those who are frightened by change, by foreigners, by the modern world, those who want to put the clock back 100 years to an era where the UK had power and influence, also all voted against EU. Those angered by politicians and big business, all the xenophobic little Englanders, all the racists and the right and far left extremists also voted for Brexit.

The remain voters, who we can call the haves with social capital, working in well-paid jobs in London and the home counties, in Oxford and Cambridge or one of the big metropolitan cities, those of us working in higher education or in the media, did not see this vote coming. Perhaps because we don’t mingle so much with the have-nots; perhaps we thought that our better informed votes would somehow count for more. We didn’t understand that people vote irrationally with their heart rather than in a well-informed rational way, with their head.  We didn’t understand how others see the globalised world as threatening and frightened rather than full of opportunities.  We didn’t understand how many people perceive themselves to be on the outside, the have-nots. Only in Scotland and Northern Ireland were there politicians, who representing the haves as well as the have nots, were listened to and agreed with.

I think as academics we have a job to do, to explain what happened in the UK on 23^rd June and why.  If the UK is going to come through the trauma of Brexit, we need to be telling the government and anyone who will listen that the UK needs to tackle the unfair distribution of power, wealth and influence.

“Little Englanders” and their impact on Higher Education in the UK (A guest post by Philip Warwick)

1966 FIFA World Cup Final: England won against West Germany at Wembley Stadium in London

There is a particular brand of thinking in the UK that has a petrifying view of the past.  Not petrifying as in scary horror films, but petrifying as in to preserve in stone.  Examples of this view are seen in the English public and popular press in the run-up to the Football World Cup.  Where English football is concerned it is forever 1966, the country expects nothing less than England to come home with the Cup (completely ignoring the evidence of past performances).  Next month, the British public will vote in large number for a UK independence party in the European Elections, in the mistaken belief that the UK can float independently from the EU, completely ignoring late 20^th century history and the evidence of international business activity that demonstrates that many of the UK’s large businesses owe their existence to trade with EU countries.  These Little Englanders as I will call them (they tend to be led by pompous white middle-aged politicians and popular press journalists from England—not Scotland, Wales or Northern Ireland) have this idea that we can petrify or preserve this view of the world in which our the UK can operate independently of the rest of world in a time warp of mid-20^th century history that never really existed and certainly no longer exists in our contemporary globalised world.

Britain’s U.K. Independence Party slogan: “Who really runs this country? 75% of our laws are now made in Brussels”.

BOOK REVIEW: “Leadership” by Rudolph W. Giuliani (2003)

“Be not afraid of greatness,” says Malvolio in Shakespeare’s Twelfth Night, “some are born great, some achieve greatness, and some have greatness thrust upon them.” 

To some extent, Rudolph “Rudy” Giuliani did have greatness thrust upon him.  Though he was a prominent politician, and already having been mayor of New York since 1994, it was on those terrible moments, on the morning of September 11^th, 2001, that Giuliani gained international attention for his leadership.  For those who witnessed the events that day or saw them recounted on the TV, the memories of Giuliani walking up Manhattan with his team as devastation all around, giving orders, remains one of the most profound images of the day.  It was for this that he was named Time Person of the Year in 2001 and received an honorary knighthood from Queen Elizabeth II in 2002.

Peter Drucker Forum 2013: “Public Policy Effectiveness and Complexity” panel discussion

At the Peter Drucker Forum 2013, Adrian Wooldridge, Management Editor of The Economist, led the panel discussion concerning issues of Effectiveness and Complexity in Public Policy. The five panel speakers were, Yves Doz, Professor of Technological Innovation at INSEAD,  John Elvidge, Chairman of Edinburgh Airport and former permanent secretary to the Scottish Government, Michael Hallsworth, Senior Policy advisor at Cabinet Office UK, Mikko Kosonen, President of The Finnish Innovation Fund, and Ben Ramalingam, Independent Consultant of Overseas Development Institute.

Peter Drucker Forum 2013: “Addressing complexity: the next challenge for governments” by Yves Doz

On the second day of the 2013 Peter Drucker Forum, Yves Doz, Solvay Chaired Professor of Technological Innovation at INSEAD, looked at the existing challenges that governments face in an increasingly complex world.

BOOK REVIEW: “When China Rules the World, the end of the western world and the birth of a new global order (second edition)” by Martin Jacques (2012)

Review by Philip Warwick

Martin Jacques, who holds academic posts at the London School of Economics and Tsinghua Universtiy in Beijing, as well as being a former journalist and founder of the left leaning Demos think-tank has produced a fascinating book about how the world’s political and economic power has been shifting in the early twenty-first century and what is likely to happen next.

Jacques finishes his book with an unexpected flourish (which I am just about to ruin for you) in which he makes a good case for China’s predicted world dominance to become a reality sooner rather than later.  Through much of the book he refers to a Goldman Sachs prediction that China’s economy will overtake the United States (US) in 2025.  The reader is left to assume that this is the date on which the new world order will be finalised.  However, in this final section he points to the rapid implosion of all things American, suggesting that the impact of the 2007/2008 financial crisis on the US (and the Europe Union), together with US foreign policy which has had a myopic focus on the middle-east for the last decade, has left the field wide open for China.  He names 2008 as the year that marked the end, or at least the beginning of the end, of a period of US world dominance that has lasted since 1945 and has been unchallenged since the collapse of the Soviet Block in 1989-1991.

BOOK REVIEW: “How Countries Compete: Strategy, Structure, and Government in the Global Economy” by Richard Vietor (2007)

How Countries Compete is a political and economic strategic analysis of 11 different countries around the world.  The book is divided into 12 new chapters, which deal with one country per chapter.  Japan is dealt with twice, looking at it from a historical perspective at the beginning of the book, and then looking more towards the future and there after the pre 1990 crisis.  Richard Vietor uses the word “compete” in the sense that countries try to compete for market share in the world economy and gain foreign investment and export their sales in business.  Governments can help in this policy, either by macroeconomic policies that encourage investment and greater economic activity, or by things like increasing human resource competencies through education.  Some countries have very active and direct policies.  In China, for example, technology transfer and know-how has been encouraged through the use of FDI.  In Singapore, workers are required to save as much as 50% of their gross income for their retirement plan.

Barack Obama: The Six Billion Dollar Man

There is a rumor going around Washington DC, that there was some kind of election last week. Things are back to normal now with college students practicing their football plays in front of the Capitol. Just in case you missed the election the results can be summarized as follows. $6 billion dollars spent, nothing changed. But that is just the point; sometimes the status quo is the best option. It is having the possibility to choose that counts.

New York after Sandy and Barack: Beware of what you see and what you hear

Last week I was fortunate enough to be in New York during the Presidential Elections and in the aftermath of Hurricane Sandy. It was an interesting reminder that being close to something may give you a totally different perspective on how events are unfolding. This doesn’t always mean you get a better one. 

Christine Lagarde becomes head of the IMF: Will this inspire future female business leaders?

Christine Lagarde has landed the job she so much wanted (and the Europeans wanted her to have) as head of the IMF. If she were a man, then everyone would be discussing whether her professional background will have adequately prepared her for the world’s second most important position.  But she isn’t. So, gender has become an issue.