Tim Martin reflects on Brexit: "Democracy is economic steroids"

After campaigning hard for the Leave campaign, JD Wetherspoon founder Tim Martin reflects on Brexit.

The western world is aghast that a majority of Russian people seems to approve of Mr Putin`s authoritarian rule, shackling  of the press and intimidation of opponents. Yet most are oblivious to a subtler reduction in democracy in the EU in recent years: laws instigated by unelected commissioners; a European Court whose judgements override national parliaments; MEPs with limited powers; unaudited accounts for 2 decades and a ruling class of 5 unelected presidents.

Both eastern and western regimes brought economic hardship to their peoples, with 50% youth unemployment in Greece and Portugal being one example in the west.

The cataclysmic referendum result on Thursday has shaken the world. Democracy is back, but like prisoners confronted with freedom for the first time in decades, the nation is frightened and awestruck by its unlimited options.

The legacy of Project Fear is that the majority seems to believe that economic prospects are now worse, but unless history is turned upside down, the reverse is true.

Democracy has always proven to be economic steroids. It took Japan and South Korea no time to emerge from  the backwaters once democracy took root. The United States economy, with democracy enshrined in its constitution, became the most successful in the world from nowhere, once it shook off the colonial yoke- no taxation without representation was the mantra.

Compare unfortunate South America. With similar population, resources and climate, but without the democratic heritage, the continent floundered badly and is still struggling mightily  to shake off its autocratic chains. Examples of the economic success of democracy abound  from New Zealand and Australia to Canada, Singapore and  Norway.

Warren Buffett, the world's greatest investor, has said that he cannot forecast where the stock market is going and he doesn't think anyone else can either. This modesty is not reflected in the central bankers and other soothsayers who, before the referendum,  forecast trouble for the UK economy in the event of Brexit.

The IMF, the OECD, the Bank of England, the CBI, Goldman Sachs, FTSE CEOs and others  lined up to  prophesy economic trouble ahead. Blinded by spreadsheets and ego, these Mystic Megs can't see the wood for the trees. The “wood” in this case being the above examples of countries which have thrived as democracy has increased- most, but not all, economists, from David Smith at the Sunday Times to Martin Wolf at the FT and Mark Carney at the Bank of England,  just don`t get this point.

So now that  the British have set themselves free, what do we do? The key, as in any successful negotiations, is to avoid being hectored or rushed.

The timescale set by David Cameron seems sensible- the referendum was not a manifesto, so we need until the autumn to hammer out a plan.

For most businesses free trade is a good starting point. It was helpful of our German friends, at their equivalent of the CBI, to point out the economic folly of attempting to impose tariffs on the EU`s biggest customer - the UK.

If both sides impose the same tariffs, the UK public finances will gain hugely, since we run a massive deficit with the EU, but free trade will benefit both our citizens and the EU's.

We can be sure that French, Italian and other producers of goods we import will take a similar view to the Germans, and that this free-trade philosophy will prevail, whatever the unelected President Juncker may think. Confounding received opinion, it's the Brussel's bureaucracy which is threatened by Brexit, not the UK, hence the hollers from Juncker and co.

On the world stage the EU acts as a “customs union” which imposes tariffs on food, wine and manufactured goods from most non-EU countries.

Wetherspoon, for example, the UK's biggest seller of wine in pubs, pays tariffs on most of the 95% of our wine we import from outside the EU.

Eliminating tariffs on non-EU imports will be a huge shot in the arm for UK consumers, reducing shop prices and  improving living standards, while acting as a catalyst for trade with the world.

Contrary to perceptions, most, but not all,  Brexiteers also believe that immigration is a common factor in almost all successful democratic economies.

The United States, Australia, New Zealand and Singapore, for example, have had consistently rising populations over many decades and that has gone hand in hand with superior economic performance.

The leaders of the Leave campaign generally recognise this point, but believe that the essential factor is to have control over the process through an Australian-style points system, which welcomes immigrants provided they have the qualifications the country needs.

The EU system, whereby entire countries become entitled to live anywhere in the EU, once they have passed the various “tests”, will no longer apply in the UK, unless parliament decides otherwise.

All parties in this debate agree that current UK residents from EU countries, who have generally made such a valuable contribution to the economy, will be allowed to stay here as a matter of international law.

My own strong view is that current inhabitants of EU countries, who are now entitled to work and reside in the UK, should also be allowed to do so in future.

This approach, similar to our historic and excellent relationship with Ireland , recognises the importance of immigration to the economic success of the UK, but means that control of the future rests with a democratically elected parliament, not with the Byzantine scheming of EU bureaucrats.

A drawback of these proposals is that high levels of immigration have put an undoubted strain on some public services. A sensible solution would be to divert the funds saved from EU membership, about £9 billion per annum, to those communities, especially less-affluent ones, that have felt the most pressure.

Democracy, prosperity and freedom are inextricably linked. The EU is heading down an increasingly autocratic path, which has already caused severe economic problems in most of  southern Europe, and risks further contagion on the continent.

Brexit is a modern Magna Carta, reasserting democratic control in the UK.  It is up to UK citizens now to participate in formulating  policies based on free trade with Europe and the world, an enterprise economy and sensible immigration policies, with parliamentary control.

As one US president said, we have nothing to fear but fear itself.

But Big Brother in Brussels is no longer in charge. The world is our oyster, provided we think clearly, debate strongly and prevent the paranoia and  hyperbole  of the referendum process from clouding our judgement.