Blog 2023 Malcolm Blair-Robinson

If the central bank of any country warns publicly of the risks inherent in a political course, a rare event, note is always and should be taken. The problem for the Bank of England governor and his senior colleagues is that the government to whom they are responsible is split in half and facing opposite directions in the most perplexing referendum ever held in these islands. Since we have not held many that maybe does not say a lot, but it is certainly the most important issue facing the whole of Europe today.

It is perplexing because of the divergence of opinion on what is a fairly simple question. Is it possible to unravel a trading relationship, political partnership and legal system developed over four decades, with its intertwined financial systems and corporate structures, without causing serious damage to the whole fabric of the economy which may take years to repair? Nobody seems to know the answer, which should cause alarm enough.

In such circumstances only a fool would suppose that the opinion of the Central Bank was a private matter, not to be disclosed to people whose whole lives might be messed up by the wrong move, but whose votes will decide the issue. The Governor of the Bank of England is not the Queen. He is most certainly not above a political move which might damage the economy and it is his duty to comment on the risk. The rest of us have to take the decision. Voting in ignorance for what is increasingly beginning to look like an unprepared flight of fancy, could lead to a very hard landing.

If it is indeed the case that Brexit would destabilise Europe and that it would be a financial disaster with unquantifiable consequences, why on earth are we having this referendum? Surely to call it is madness? Or if it is instead the case that Brexit will bring great benefits in trade and  jobs how exactly is this so?

The British public are faced with the extraordinary spectacle of a public contest between the serving prime minister and the man who intends to replace him, each in turn served by followers echoing blood curdling or Utopian prophesies depending on which side they are on, which rather than inform, simply confuse. The root of the difficulty is that this referendum is not really about Europe, it is about two wings of the Tory party, split ever since Thatcher  and perhaps well before, finally busting apart and fighting it out.

This is democratically ridiculous. It is like a general election in which one party is fighting against itself from each side. If our economy was as robust as the muddled Chancellor as his fumbling Treasury assert, how is it that our shrunken manufacturing sector is now officially in recession? Is that truly a symptom of a strong economy? Whether it may be better to stay or leave seems to be beyond coherent analysis. What is clear is that with the economy in the state it is, this is no time to fool about with a referendum. It is like playing with petrol in a house already on fire.