Brexit and the Fourth of July

Posted by Brad McMillan, CFA, CAIA, MAI

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This entry was posted on Jul 1, 2016 2:03:20 PM

and tagged In the News

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brexitOkay, unless something else happens, I promise this will be it for the Brexit posts. I’m probably as sick as you are of the “all Brexit, all the time” coverage, and I’ve been guilty of that here on the blog as well. That said, I do think there’s one final point worth making about Brexit.

This weekend, we celebrate Independence Day, the day that Americans—who, you’ll recall, were British at the time—threw off the yoke of a distant, unresponsive government. Tired of rules that made no sense, of taxes imposed without their consent, and of a sorry lack of representation, the American colonists took economic, political, and very personal risks in the name of independence. (When Ben Franklin said at the signing of the Declaration of Independence, “We must indeed all hang together, or most assuredly we shall all hang separately,” he was dead serious.)

In light of the Brexit vote, does any of this sound familiar?

Not just a question of economics

Much of the Brexit coverage has focused on economic issues, and they are important. But in reading the commentary and talking with friends in the U.K., the real motivation for British voters was to take back their country. That desire certainly resonates on these shores; from a purely economic standpoint, Americans would have been better off staying in the British Empire.

The risks Britain faces are real, but perhaps not as onerous as many would think. As I mentioned earlier this week, along with the risks of independence come opportunities. In many ways, leaving the security of the EU is a very entrepreneurial—and, dare I say, American—thing to do.

When we celebrate the Fourth of July, we are celebrating our collective decision and willingness to take risks, to assert our own needs and vision of the future against existing structures. The U.S. grew in the face of the British, French, and other empires around the world. Microsoft and Apple grew in the face of IBM. And Google is facing off against the EU right now.

A move we Americans ought to respect

The willingness of the British public to shoulder real risks in pursuit of their own interests demands our admiration and, I would argue, our assistance. The U.S. should stand by to offer trade agreements, advice, support, and whatever else we can.

And we should do the same for the EU. Brexit is a sign that changes—significant ones—need to be made there. Whether or not the EU perseveres or breaks up, we have to respect the decisions the member countries make. The citizens of each country should be able to decide, on their own, how they want to govern themselves.

As Americans, we are uniquely blessed with the right to “life, liberty, and the pursuit of happiness.” On the Fourth of July especially, we should recognize that same sentiment in the Brexit vote.

Happy Fourth!

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