OECD Issues Damning Report on Effect of Brexit

The Organization for Economic Cooperation and Development argues that Brexit – the UK leaving the European Union – would be an economic shock with costs. “In the longer term, [the OECD] calculates that more restrictive trading arrangements with the EU alongside less competition, lower foreign direct investment and fewer skilled immigrants, would hit gross domestic product by a central estimate of 5 per cent, slightly less than the Treasury’s 6.2 per cent figure,” reports Chris Giles for Financial Times. The OECD has 34 advanced economies as members, a majority of which are EU members. A united EU has clout, and OECD officials argue that “there is no reason to think that Britain would get better trade or investment deals outside the EU.” On its own, Britain would have to abide by WTO rules with higher costs or negotiate new trade agreements. Uncertainty is already a drag on the British economy. One commenter points out that the battle pits democracy and self-governance against logic and economics. Democracies eventually end programs that concentrate benefits among a few, and UK voters must ponder whether UK or EU governance does the better job. – YaleGlobal