The most striking thing about the Treasury’s forecast of the impact of Brexit is the relative modesty of its claim that by 2030, assuming a UK-EU trade deal akin to the one negotiated by Canada, ‘our GDP would be 6.2 per cent lower’ while ‘families would be £4,300 worse off’. Since those quotes come from the foreword signed by George Osborne, many voters will distrust the whole document — in which case they might prefer the even more modest ‘worst case’ of a 2.2 per cent GDP hit by 2030 predicted by non-partisan think-tank Open Europe alongside what it calls ‘a far more realistic’ range of possible outcomes ‘between a 0.8 per cent permanent loss to GDP… and a 0.6 per cent permanent gain’.
If we take a middle way through all these forecasts, the most likely outcome is a run of small annual falls in GDP, after a big jolt at the start. A significant minority foresees the opposite: small annual GDP gains as a result of deregulation and souped-up trade. But ‘small’ is key either way; and before 2030 we must also be due at least one recession and a couple of downturns. The worst such episode in recent times was a 5.2 per cent single-year GDP fall in 2009, reminding us that a ‘black swan’ — bank crash, energy price spike, nuclear conflict — could have far greater impact than Brexit. By 2030 it will be impossible to unravel the effects of leaving or remaining from the effects of everything else that has happened in the lottery of life.
Both sides should admit that forecasting is bunk (to adapt Henry Ford) and neither should pretend Brexit will be catastrophic or miraculous. If they must talk about economics, both should focus on real-life examples of how EU membership has hindered or helped British business and prosperity.