No Deal, No Problem
Britain is braced for economic meltdown and more if you believe the scare stories building up to the critical House of Commons showdown next week. Most of us are impotent, watching from the side-lines hoping that some highly principled MP’s park their party loyalty and stop the clock.
Wrong. Leaving the EU with certain arrangement and understandings in place is clearly preferable to “crashing out”, but moving from our current arrangement to the global set-up governed by the World Trade Organisation is hardly a disaster. It is — after all — what 159 other countries are used to and most of those are not remotely as powerful or influential as the UK.
The Brussels bureaucrats flex their muscles like any other syndicate, threatening unspeakable consequences if we don’t play by their rule and — crucially — keep paying. And they have distorted the debate. James Dyson’s perfectly rational business decision to base his expanding empire on the doorstep of the fastest growing markets in the world is being seen as a betrayal — a hard-headed calculation viewed through the crazy kaleidoscope of British politics.
And that’s my problem. Brexit is distorting rational debate and — even more crucially — distracting us from the challenges and opportunities of our age. I left the City because the energy, dynamism and innovation that gave us the edge in finance is now more prevalent in Fintech. Having traded derivatives for more than a decade I traded my square mile sinecure for a start-up in Southwark. Life is tougher — but far more fulfilling.
Critics are right that Brexit is a threat to the City. A small number of jobs may go, but the City is bloated, sucking far too much talent from other areas where our long-term economic prospects are brighter. We don’t want to surrender our lead, and we won’t, but culling inefficient industries and re-calibrating to meet future needs is at the heart of capitalism.
And the new industries are far more in tune with real people and far more focussed on their needs. At Switchcraft, we harness technology to ensure our customers are always on the best energy deal available, and we’ll switch them automatically so it stays that way. Other start-ups are transforming banking, foreign currency, savings, peer-to-peer lending and so much more. Open banking turbo charges all of these — taking savings to customers who had to search hard to find them in the past.
London is thriving because it’s the place most start-ups want to be. History, quality of life, time-zone, terrific universities and the English language are major assets. But, to their credit, the government have also created a tax regime conducive to innovation and entrepreneurship. EIS and the Seed EIS are particularly helpful getting some of us to the stage where the venture capitalists pile in and take firms to another level.
None of this will be ruined by Brexit — deal or no-deal. What could ruin it is a mentality that clings to a clapped-out idea that markets have to be regulated by a small highly centralised clique in Brussels, answerable to no-one but themselves and rigid in their outlook. Fintech will be fine, but freed of the failed intellectual orthodoxy of the last 20 years, we could achieve so much more, re-booting the British economy, championing consumers everywhere they are confronted with a complacent corporate over-charging and underdelivering — and aiming for those distant horizons far beyond the borders of the fortress the EU has become.
Andrew Long, Former city trader & founder of Switchcraft
