5 reasons why Americans should care about Brexit
WASHINGTON — Britain’s stunning vote to leave the European Union is both historic and world-changing. But what does it really mean for folks living on the other side of the Atlantic? Potentially, everything — the economy, national security, even the race for president. Here are five ways Brexit will affect Americans:
It could hurt the economy
The UK is the world’s fifth-largest economy and one of the United States’ largest trading partners, so if it catches a cold, we may get a little sick, too. When the pound dropped to 30-year lows as the results came in and British stocks got pounded, it was no surprise when Wall Street tumbled more than 500 points right after the opening bell Friday morning. So yes, your 401k’s probably a little smaller right now.
Lots of U.S. companies invest in the UK as a gateway to the rest Europe’s market. Companies like Rolls Royce and JPMorgan warned before Thursday’s vote that leaving the EU would put those investments and jobs in the UK at risk. Big companies and banks may also move staff to Germany or France to avoid disruption to their EU business. Why’s that risky for the U.S.? There’s a real fear that increased unemployment in the UK and all the uncertainty could push Britain into a recession, and it could take America’s economy down with it.
It may leave a less stable Europe
Brexit could start a long line of dominoes to fall across Europe. Greece has been thinking about getting out of the EU for a couple of years now. Now they may start thinking out loud. Far-right politicians in the Netherlands and France looked at what happened in Britain and said, hey, we want get-out-of-the EU referendums in our countries too. If enough dominoes fall, there’s a real danger the EU could collapse.
Heck, the UK itself may be headed for a breakup. Scotland, which voted Remain, is almost certain to call for another referendum on its independence — so it can join the EU. Leaders in Northern Ireland may push to reunite with Ireland.
In short, the U.S. could soon be dealing with a volatile and unstable Europe, a plight that makes everyone less safe.
Uncertainty. Instability. Economic anxiety: the very things the world said it had enough of when the idea for a European trading bloc was born decades ago in the ashes of World War II.
It puts stress on the ‘special relationship’
Both President Obama and Vice President Joe Biden said after the vote that the special bond between the U.S. and the UK will endure, but there can’t help but be some changes.
Remember, back in April, Obama said a successful Brexit would move Britain to the “back of the queue” when it came to trade deals with the United States. America’s already trying to cobble together a deal with what will be left of the EU now. If the Brits want one with the U.S. after they get out of the EU, they’ll just have to wait. That won’t exactly make them feel all warm and fuzzy inside.
Another thing the U.S. finds so special about the UK? Being able to exert some influence on the EU, via the UK’s voice. With the British soon to be gone from the bloc, the U.S. may now need to start paying more attention to its relationships with some other countries — hello, Germany and France — in order to achieve that goal.
Trump will go all in on immigration
Donald Trump shot to the top of the GOP primary field and eventually to the nomination by focusing on illegal immigration. Fears surrounding immigration was a big factor for a lot of Brits who pulled the lever for Leave, and Trump suspects it will be, too, for Americans voting for a new president in the fall.
“Americans will have a chance to vote for trade, immigration and foreign policies that put our citizens first,” he said Friday from Turnberry, a golf resort he owns in Scotland.
So expect Trump — who was showing signs of moderating his positions somewhat — to go full throttle on his immigration ideas, like building a wall with Mexico and his proposed Muslim ban. Trump’s also betting that the kind of political message that worked like a charm in the referendum — a harsh critique of free trade and demands to “take our country back” — will be just as effective among blue-collar workers in rust belt states in the United States.
Travel to the UK will be cheaper
Looks like the pound’s going to be down for a while, so yes, your upcoming UK vacation just got a lot cheaper. You can see Big Ben, the Tower of London, Stonehenge, Buckingham Palace and other British landmarks with less cash than you’ve had to dole out in decades, because your U.S. dollar will be a lot stronger compared to the pound over there for the foreseeable future.
And the Brits will be happy to see you: the UK is going to start having far fewer tourists from the EU itself. That’s because it’ll be more of a hassle for Europeans to visit. Immigration lines will be more clogged due to the extra processing for EU citizens who would’ve previously enjoyed visa-free access.
Last year, EU countries made up seven of the top 10 countries sending tourists to the UK, so Americans, who were the second biggest group, will likely move on up to the top spot, replacing France.