EU Referendum: The result and aftermath...

[miami]

I did the sums buying mine.
£8250 66 reg 9 miles.
Road tax £20/yr
Insurance (currently) £240/yr
Miles 8000/yr @ £0.11/mile £880/yr
Service (first two yrs) £200 appx
Service and MOT after two £250 appx
So not including tyres and other stuff, if there's no major breakdown/failure for the next 7 years it's £1400/yr.

Thinking a taxi return to town is £8, I could have 175 return taxi trips for that!!

Your costs (upfront and insurance) is far below average, and mileage below average - however even if they weren't and your road tax was £140/year, your cost per year would go from £1400 (plus tyres etc) to £1520 (plus tyres, petrol, etc) -- less than a 10% rise.

You're using 735 litres of petrol a year. Petrol is currently £1.20/litre. In March 2016 it was £1.03/litre, in 2013 it was £1.40. A return to pre-brexit prices would save you £122, an increase to 2013 prices would increase your cost by over £200. Sure buying the car in March rather than April is worthwhile, but the extra VED cost is insignificant compared with petrol fluctuations alone, let alone when factoring in the other costs.

VED changes have very limited effect on a rational buyer of a new car.

 

[Tetchytyke]

Ahh, get the excuses in early.

It's not just the cash, it's the emotional impact of it too.

My car currently has VED of £0. Under the new rules the equivalent car is going to be £140 a year. It's not much in the grand scheme of things, but it is enough to make me question whether I want to buy new or whether I'll buy a secondhand car.

 

[miami]

It's not just the cash, it's the emotional impact of it too.

Ahh yes, irrational decisions made on emotion rather than logic. That's brexit all over.

 

[Geezertronic]

Ahh, get the excuses in early.

I fail to see how that is getting an excuse in early. It's a fact, has nothing to do with Brexit and everything to do with an additional Government tax, but is worth noting. No need to get so defensive dear

 

[DynamicSpirit]

The biggest boon to the UK economy would be for consumers to buy British made goods.

Buying British-made groups stuff is of course great, and buying locally sourced goods is arguably also great for supporting local culture (and the environment) in any locality. But getting people to buy-local as an attempt to help the economy doesn't really create jobs, it merely imports them from other countries, thereby hurting other (often, poorer) countries in the process. And of course if those other countries respond in kind, then it won't even help the UK - we'll simply lose as many jobs as we import.

When it comes to helping the economy, I'd rather focus on things that genuinely do create new jobs - that means things like economic investment.

 

[DynamicSpirit]

So many cars are purchased from abroad partly because (aside from marginal transportation costs) there is no cost penalty in doing so.

If tariffs in future start to apply to some cars but not others, there would be a price differential that would (in my view) change consumer behaviour. The British-made Honda Civic would probably gain a relative advantage over the German-made Volkswagen Golf for example. People will only swallow significant price increases (and you're right, automotive tariffs are large) if there is no other option or if the quality of the more expensive cars really is worth the price differential.

This is how protectionist tariffs are supposed to work but they effectively operate as an unwanted tax payable ultimately by consumers to the state. It's a little like a rise in VAT (although perhaps we could selectively cut VAT using tariff income to help to offset the impact on consumers).

I wonder if there's another way of looking at it. The tariffs act as a deterrent to people in any country from purchasing stuff from the other side of the tariff-barrier. And in the process, the tariffs provide an additional source of revenue to Governments on both sides of the barrier, which perhaps allows slightly lower overall taxation (or higher spending) elsewhere in the economy.

If you want to argue - as some appear to be arguing - that buying local is better (and I would expect that there may be some environmental grounds to assert that), then you might conclude that the tariffs change behaviour in a beneficial way. Also, if different countries have different safety/environmental/etc. standards, then tariffs might serve to offset any bad effects from companies moving to whereever the lowest standards are in order to minimize costs. Hence tariffs could help to prevent a race-to-the-bottom on standards. Of course that needs to be set against the argument that free trade seems to have a good historical record of increasing incomes overall.

Certainly, it does strike me as somewhat odd that so many are unthinkingly calling for free, tariff-free, movement of goods while at the same time wanting a clampdown on free movement of people. I wonder hpw many people have really thought through the issues or whether that's really what we should be aiming for.

 

[meridian2]

Buying British-made groups stuff is of course great, and buying locally sourced goods is arguably also great for supporting local culture (and the environment) in any locality. But getting people to buy-local as an attempt to help the economy doesn't really create jobs, it merely imports them from other countries, thereby hurting other (often, poorer) countries in the process. And of course if those other countries respond in kind, then it won't even help the UK - we'll simply lose as many jobs as we import.

When it comes to helping the economy, I'd rather focus on things that genuinely do create new jobs - that means things like economic investment.

Not sure I understand your argument. My point is buying British designed and manufactured goods contributes to the domestic economy and employs the people we live among, helping make our society happier and more prosperous. It isn't always possible, there are only three UK owned, designed and built motor cars and none of them can be described as volume produced or practical. Next best is a foreign owned British produced car, like Toyota or Nissan, which keeps our people in jobs.

I don't see how buying British made goods "doesn't really create jobs, it merely imports them from other countries"? The UK consumer is paying an artificially low price for some products, because overseas governments want the revenue and have completely different health, safety and age restrictions, or those governments underwrite a producer as a national asset and major employer. They recognise that making things adds value in excess of the bottom line. There are very few things EU countries offer that have not or cannot be made in Britain. For those things you have to look outside Europe, and they are not affected by Brexit anyway.

If some things cost more but create more UK jobs, there's a net benefit. The problem in the short term is training people to make the things we used to take for granted. Britain is one of the most industrialised, educated and skilled nations on the planet, but we've chosen service industries rather than a mixed economy where other countries have maintained theirs. That was a mistake but correcting the problem is not impossible.

 

[najaB]

I don't see how buying British made goods "doesn't really create jobs, it merely imports them from other countries"?

The same amount of stuff is being made, requiring the same amount of labour. Buying British-made just means that the labour sourced in the UK, rather than being sourced somewhere else. There is no net job creation.

 

[miami]

When it comes to helping the economy, I'd rather focus on things that genuinely do create new jobs - that means things like economic investment.

Economic investment such as that enabled by the world's largest public lending institution? (The thing bankrolling Crossrail and Metrollink phase 3)?

The UK has a seat on the board of governers and the board of directors, and it's objectives are
* To finance viable capital projects which further EU objectives
* To borrow on the capital markets to finance these projects

 

[Barn]

If some things cost more but create more UK jobs, there's a net benefit.

Sometimes, but not always. It can be that the extra cost to consumers (and thus the lower spending power created) has a greater negative effect on the economy than any positive effect gained from creating or retaining jobs.

Using tariffs to protect an industry might create / retain 1,000 jobs with an average salary of £30,000. Crudely, let's say this introduces / retains £30m in the economy.

But the higher costs caused by the tariff regime might cost the average consumer an extra £100, and if there are one million consumers the total deduction from spending power could be £100m.

Tariffs often help the few by hurting the many.

 

[meridian2]

The same amount of stuff is being made, requiring the same amount of labour. Buying British-made just means that the labour sourced in the UK, rather than being sourced somewhere else. There is no net job creation.

Yes, the Labour is sourced in the UK rather than imported from overseas. The priority is British jobs and the jobs of those with whom we trade for mutual advantage.

 

[meridian2]

Tariffs often help the few by hurting the many.

I agree, though there has to be reciprocity of scale. An extreme example would be importing, cars, military and defence components, ships and white goods, and exporting potatoes to the same nation. One of the reasons the EU became unfair was some countries had governmentally sponsored heavy industry exporting to their neighbours, while other nations exported mainly people. Britain chose to be a service sector because in the short term it made sense to import "stuff". In the longer term being committed to exclusively importing anything that cannot be made domestically is a bad idea, as it forces countries to become dependent on neighbours rather than trading as equals.

The best economy is a balanced economy.

 

[najaB]

Yes, the Labour is sourced in the UK rather than imported from overseas. The priority is British jobs and the jobs of those with whom we trade for mutual advantage.

I don't understand the point (if any) that you are trying to make. The (singular definite article) priority can't be UK jobs *and* foreign jobs. It has to be one or the other.

 

[fowler9]

This is all without a doubt very complicated. Apparently parts used for cars built in the UK go backwards and forwards across Europe through various countries several times before the finished car is produced. Surely various charges will apply as the parts move backwards and forwards. I presume Airbus and Rolls Royce jet engines will suffer a similar effect. Today an EU legal bod said that the EU should be moving clearing houses for the Euro out of the UK and back in to the EU. This will, if it happens and it is not definite that it will, impact on 100,000 jobs directly plus all the service jobs that provide for the employees. Like I say it won't definitely happen but I really couldn't blame the EU for doing it. They would want to look after their own. Loads of unintended consequences have already been thrown up which I think many, me included, never thought about. I voted remain just on the small number of consequences I thought of.

 

[fowler9]

One thing I find really frustrating is being told by people that voted leave that I am just coming out with negative stories. If I could find a single positive rumour or story I would share it. "Stop hitting me with those negative waves" just sounds like Oddball in Kellys Heroes. He got the German gold and spent it all on a rubbish tank. Ha ha.

 

[ExRes]

The same amount of stuff is being made, requiring the same amount of labour. Buying British-made just means that the labour sourced in the UK, rather than being sourced somewhere else. There is no net job creation.

How can you say that? if you need 100 people to build something and 50 are employed currently in both the UK and say Italy, then having 100 employed in the UK is not net job creation?

 

[najaB]

How can you say that? if you need 100 people to build something and 50 are employed currently in both the UK and say Italy, then having 100 employed in the UK is not net job creation?

What will the 50 people in Italy be doing?

 

[fowler9]

How can you say that? if you need 100 people to build something and 50 are employed currently in both the UK and say Italy, then having 100 employed in the UK is not net job creation?

Good point, I do worry that companies based in the EU will not want to go hell for leather building cars in the UK to export to the EU if the tariff is higher though. It all remains to be seen.

 

[ExRes]

What will the 50 people in Italy be doing?

Perhaps I've arrived at the wrong Referendum thread by accident, I rather thought job creation in the UK was the point of the exercise

 

[AlterEgo]

What will the 50 people in Italy be doing?

Isn't that for the Italian government to figure out?

 

[fowler9]

Perhaps I've arrived at the wrong Referendum thread by accident, I rather thought job creation in the UK was the point of the exercise

To be fair I think it is more likely that EU car producers will shift car production to EU countries than to the UK and how many car factories in the UK are actually UK companies. It isn't beyond reason that we could set up our own companies again but it would take quite a bit of time to do.

 

[Barn]

Perhaps I've arrived at the wrong Referendum thread by accident, I rather thought job creation in the UK was the point of the exercise

najaB is correct if you take the field of reference for job creation as "the world". In that case, only a transfer has taken place, not a creation.

However, measuring by country is usually the more relevant metric, as a country is usually the unit in respect of which things like currency, tax base, health system, education system, welfare system, interest rates, fiscal decisions, pensions, public debt, etc are configured...

 

[meridian2]

I don't understand the point (if any) that you are trying to make. The (singular definite article) priority can't be UK jobs *and* foreign jobs. It has to be one or the other.

I never mentioned foreign jobs at any point. The priority has to be UK jobs and the highest skilled overseas labour from wherever it is to be found where necessary. After that refugees from war and famine.

 

[meridian2]

Perhaps I've arrived at the wrong Referendum thread by accident, I rather thought job creation in the UK was the point of the exercise

Me too, I fail to see what responsibility it is of the UK to keep the Italian workforce employed as EU members, never mind once we've left.

 

[furnessvale]

One thing I find really frustrating is being told by people that voted leave that I am just coming out with negative stories. If I could find a single positive rumour or story I would share it. "Stop hitting me with those negative waves" just sounds like Oddball in Kellys Heroes. He got the German gold and spent it all on a rubbish tank. Ha ha.

Perhaps you should research the potential of Free Trade Zones, an option that will be available to the UK once free of EU restrictions.

 

[fowler9]

Perhaps you should research the potential of Free Trade Zones, an option that will be available to the UK once free of EU restrictions.

Just did, loosens environmental protections and rules regarding negligence and treatment of workers. Sounds great.

 

[najaB]

Perhaps I've arrived at the wrong Referendum thread by accident, I rather thought job creation in the UK was the point of the exercise

That all depends on the cost of those jobs, surely? It's all fine and good to say that you've created jobs for UK people but what if the products end up being more expensive to produce as a result? Especially if you also can't sell into the overseas market as easily?

 

[furnessvale]

Just did, loosens environmental protections and rules regarding negligence and treatment of workers. Sounds great.

Given it took you all of 5 minutes to research what is a complex issue, I'll take that with a pinch of salt.

 

[fowler9]

Given it took you all of 5 minutes to research what is a complex issue, I'll take that with a pinch of salt.

Given it took me less than 5 minutes to find that out with the gift of google I would take it seriously.

 

[fowler9]

You are throwing yourself in there with some interesting company if you want to go the Free Trade Zone route.