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Brexit: the emotional dimension

Published on January 27, 2017

It’s been 7 months after the vote for Brexit and it looks like we have a plan, set out in Theresa May’s speech last week which will be backed up by a White Paper. Like business plans, the 12 points are legally sound and encapsulate what their creator, the Government, wants.But like many such documents it hasn’t taken full account of the other parties and their reactions, which will be driven by emotion as much as by law and economics.

The most important party in the negotiations is the EU and its member states. While they will acknowledge the economic benefits of maintaining a reasonably open trading relationship they are also rather traumatised (as are many Brits). Their emotional reaction has all the characteristics of a divorcee. The UK, as they see it, is having a mid-life crisis. It hasn’t had an affair but it feels restless and wants to leave. The marriage isn’t what it was 43 years ago when it started: that was just a big flat share. Then everyone grew up and UK thought “when am I going to be able to get out and see the world?”. Europe doesn’t know what it’s done wrong. UK was consulted on everything and when it really didn’t want to get involved it was allowed to opt out. It feels that it bent over backwards and now it’s feeling pretty hurt. Saying that we don’t want to take things that aren’t ours, or cause any trouble, just doesn’t really cut it with the abandoned party and so all our reasonableness isn’t going to cut much ice, at least not for a while. Maybe when there’s more agitation for withdrawal, especially if Marine Le Pen gets in, then we’ll be seen as Ms Reasonable. But for now we’re going to have to sit calmly and wait for the emotional storm to blow over.

Then there are constituents in the UK. Car manufacturers say that they can’t plan long term and the City is quick to point out the costs – we’re already hearing of banks moving staff out of the City. This is designed to frighten the Government into making promises for special treatment. The best response here is not to succumb, to keep analysing the situation and ensure that there are alternatives even if they involve costs or lost tax revenue in the short term but a better result in the long term. There is no mass departure in the offing because London has a huge centre of gravity which is stronger than any one organisation and even a whole sub-sector. A few thousand job transfers will improve the net immigration figures and reduce the dependence of the economy on financial services. Having organisations that are too big to fail means that the ruled hold more power than the rulers and that’s a tricky place to be because it can mean decisions are made to subsidise corporations with taxpayers’ money. That wasn’t popular in 2008 and it would be even less popular in 2018.

While Jim Collins advocates (in Good to Great) that great organisations don’t operate a blame culture, political systems still do. Success in the negotiations is far from guaranteed and if Mrs May is as capable as they say then she will have looked at the downside and considered how to apportion blame. Unlike her recent predecessors she won’t be able to blame the EU. If we have a complex treaty then that could be targeted, but it’s more natural to personalise the source of our grievances. It may be that old habits die hard and the French resume their historic role, or that a blogger combines that deep-rooted but vague enmity with some personalities. Maybe we will see the problems as having been created by the cavalier behaviour of the Three Brexiteers? How about Ian (Athos) Duncan-Smith – the aristocratic older one; Michael (Porthos) Gove – leaving the fray for the priesthood aka journalism; and Boris (Aramis) Johnson – the most worldly and vain of the three?

As they say, thoughts produce decisions but emotions produce actions. It won’t be until everyone’s emotions have been dealt with that Brexit will be concluded. And emotions are slower to change than policy makers and business planners would like. That’s why businesses take longer than planned to really grow, and why Brexit will still be around in the 2020s, just less painful/frightening/amusing than it is now.