Dafuq is the EU?

The European Union was not created in one go. The present European Union took years to take shape. It
is the result of gradual integration of nations and economies since 1945. We can rather call this process
an evolution where one level led to the next. Below, is narrated a brief story of the same.

Let us go back a few years in the past. Some seven decades rather. The year of 1945 to be exact.
Something important happened then. Remember? Not much of a history fan? No issues. What
happened was this:

Yes, the Second World War had come to an end. The Japs surrendered and so did the Nazis along with
the Axis powers. Hitler had shot himself dead. Kudos to my childhood friend who in end term
examinations had famously written that Mussolini killed Hitler and had still got away with full marks. But

that story is for another day. Point for now is - The War was finally over in the year of 1945. The war had
its own tolls but as a silver lining, it had left the world a bit wiser than it was before. What this meant
was the European nations had finally realized that it brings them more harm than good by fighting
frequent bloody wars amongst themselves. As this wonderful realization dawned upon them, it was only
a matter of time before Peace treaties were signed.
But, peace was only a part of the whole picture. Merely being peaceful by not each waging wars with
each other was not enough. This was the modern world in making. Economy was the new shiz! Quite
naturally, the European post war nations werent after only peace, they were also hell bent to solve
economic problems like sourcing of raw materials from other countries, inter country trade bans and
inter country taxes to name a few. The war had left these nations exhausted and on top of that they
remained under the constant threat of attack from the badass Russians. I guess nobody likes vodka
laced breaths on their shoulders. Under such premises, in 1952, six neighboring countries (Germany,
Belgium, France, Holland, Italy and Luxembourg) decided to enter the Treaty of Paris to create an area of
free trade for various key resources like coal, steel, iron ore etc. for industry and military. This body was
called the European Coal and Steel Community (ECSC). The world had unknowingly witnessed the first
step towards the formation of The European Union.
The ECSC was a success. Owing to its success and to gain further momentum, in what is known as the
Treaty of Rome (1957), another body was created The European Economic Community (EEC). The EEC
led to the formation of a common market among member nations with no tariffs on goods or labors.
Economy kept booming. The pact had served its purpose. Sure, there were internal politics and all, but it
was a coveted club by now. The 70s and 80s saw nations joining this elite club. The EEC membership
expanded. Everyone wanted to be inside the gates of this new club in town. Even Great Britain entered
it after seeing its economy lagging behind others. Slowly, the club or association of nations started
meaning a lot more than just free trade area. There was the birth of a common currency, common trade
area and most importantly common policies both foreign and internal. Finally, in 1993 The Treaty of
Maastricht was signed and The European Union was formed. It is a political and economic union
between Sovereign European countries which makes its own policies concerning the members
economies, societies, laws and to some extent security. Following is the list of nations with their entry
dates (Just for gaining an insight, memorize at your own peril!):
1957
1973
1981
1986
1995
2004
2007
2013

Belgium, France, West Germany, Italy, Luxembourg, Netherlands

Denmark, Ireland, United Kingdom
Greece
Portugal, Spain
Austria, Finland and Sweden
Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovak Republic,
Slovenia
Bulgaria, Romania
Croatia

Till now we have somewhat learnt what the EU is, how did it come into existence in the first place and
the purpose of its existence. Now, its time we delve into the main part of what Brexit is and what are
the arguments associated. Lets now fast forward to present day, the year of 2016.
BREXIT & Its Implications
Brexit (Britain-Exit) in layman terms is exit of The Great Britain from the European Union. A referendum
was held where the people of Britain voted to stay or leave the EU. The political parties which vouched
for remaining in the EU were - The Conservative Party, the Labour Party, the Liberal Democrat Party, the
Scottish Nationalist Party, Plaid Cymru and the Green Party. The notable people in support of remaining
were - David Cameron, Stephen Hawking, thirteen UK Nobel-prizewinners, Richard Branson, Benedict
Cumberbatch, J.K.Rowling, Elton John, Jeremy Clarkson, David Beckham, George Osborne and all living
former Prime Ministers plus Barack Obama.

The parties which supported a leave from the EU were UKIP (UK independence party), the BNP (British
National Party), the EDL (English Defence League), the DUP (Democratic Unionists, Ulster). Their notable
personalities were - Nigel Farage, Boris Johnson, Ian Botham and of course Vladimir Putin.

After numerous debates, interviews with intellectuals, political influences and campaigns, Britain finally
went to vote. On Friday, June 24, the referendum results finally came out and it was close as hell. While
48% voted to remain, 52% were in favor of leaving the EU. What followed was wide protests of the
youth of Britain lamenting that the old population voted for exit and now they, the future have to bear
the consequences. Just to give you a perspective of the situation, here is some further analysis:
REMAIN
Young voters (under 30): 63%
Voters aged 30-39 : 58%
Voters aged 40-49 : 52%
University graduates: 62%
Those with A levels or equivalent: 53%
University students: over 75%

LEAVE
Older voters (over 60): 56%
Voters 50-59: 52%
Voters with no qualification higher than GCSE: 57%

Things might get a tad bit boring north of this wall. We have tried to make it as crisp and pointed as
possible. We shall now analyze some of the key issues that were featured in the debates:
Immigration
It was one of the most fiercely debated and emotive issues for voters. Each migrant effects the
economy, wealth and public spending of the nation. There are three million EU nationals living in
the UK (excluding Britons). Two thirds of them have arrived since 1993 - with huge movements of
workers from Eastern European member states after 2004. Two-thirds of EU nationals are working.
Free movement of EU citizens - the right to move from nation to another - is a fundamental and
"non-negotiable" part of membership backed up by law. The EU has no say over who migrates into a
particular member state from another part of the world.

Leave:

It is impossible to control immigration as a member of the EU

Public services are under strain because of the number of migrants

High immigration has driven down wages for British workers

Points-based system for migrants to the UK should be extended to include those from the EU

Remain:

Immigrants, especially those from the EU, pay more in taxes than they take out

Cameron's EU deal means in-work benefits for new EU migrant workers will be limited for the
first four years

Outside the EU the UK would still have to accept free movement to gain full access to the single
market

Immigration is good for the economy

Trade & Economy

An empirical analysis of the effect of Brexit on Britains trade is not possible. It can at most get to the
extent of a speculative analysis. Trade is very important to Britain since 28% of what they produce is
exported. When goods are services would be sold or sourced across borders post Brexit, they would face
the heat of tariffs, limits on the amounts and standard difference. The whole process becomes much
costlier. Also, a staggering 45% of all exports of Britain goes to the EU.
Leave:

UK companies would be freed from the burden of EU regulation

Trade with EU countries would continue because we import more from them than we export to
them

Britain would be able to negotiate its own trade deals with other countries

Remain:

Brexit would cause an economic shock and growth would be slower

As a share of exports Britain is more dependent on the rest of the EU than they are on us

The UK would still have to apply EU rules to retain access to the single market

Cost of Membership
So, the EU charges a cost of membership from its member states. Basically much like any other
coveted club out there to sustain its activities and maintenance. In 2014, UKs contribution was 18.8bn
alone! They get a rebate which reduces the bill by 4.4bn.
A major chunk i.e. 40% of this cost of membership fund is used by EU for agricultural developments.
Yes, they have that thing back there. A third of the budget is then spent on what EU calls, economic,
social and territorial cohesion which means spending in development of poorer members. With this
money, the EU does not perform principal functions of the member states.
Leave:

The gross cost works out at 350m a week

If the UK left, billions of pounds would become available for other priorities

The UK would also be able to decide how to spend the money that the EU transfers back to it

Remain:

Economic benefits of EU membership easily outweigh the cost

Other countries contribute more per person than the UK does

After Brexit, the UK would still have to contribute to the EU budget to retain access to the single
market

By no stretch of our imagination, the above list is exhaustive. If you have the time and will, please search
points like Effects on sovereignty, healthcare, jobs and mobility.
The road ahead
The road ahead is not that simple. The result of the referendum alone does not suffice for an instant
exit. For starters, the result does not legally bind for an exit. But a stand otherwise would be political
suicide. The process is quite cumbersome and lengthy.
Article 50 of the Treaty on European Union establishes the procedures for a member state to withdraw
from the EU. It requires the member state to notify the EU of its withdrawal and obliges the EU to then
try to negotiate a withdrawal agreement with that state.
Once Britain invokes the article 50, it will have a 2 year window to negotiate a new treaty in place of the
membership in EU. Britain and EU leaders would have to hash out issues like trade tariffs, migration,
and the regulation of everything from cars to agriculture. So, all these are yet to unfold and of course
the actual effect on economy and job market remains to be seen.
Hope this helped!