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29 November 2018

Dismissing “Project Fear” is an effective tactic – but that doesn’t make the predictions wrong

Winning the political argument is not the same as being right.

By Jonn Elledge

There are many things we can blame George Osborne for, a depressingly high number of which remain relevant today – but the part of his legacy that’s dominating the headlines this week can be summed up in two words. “Project Fear” was what Britain Stronger In Europe called its proposed campaign strategy of predicting economic apocalypse in the event Britain voted to leave the European Union. Osborne’s Treasury was only too happy to oblige, warning that a Leave vote would cause an “immediate and profund” economic shock, involving falls in wages and house prices and nearly a million lost jobs.

The last two years have not been good ones for the British economy, which has dropped from being the fastest growing in the G7 in 2015, to the slowest two years later. But the more terrifying of the Project Fear warnings have not come to pass, and Osborne’s claim that Brexit would leave every household in Britain £4,300 worse off made him look faintly silly. The very next words – “by 2030” – have been forgotten, and weren’t meaningful to most people anyway.

So, Project Fear is discredited, and so are the sort of economic predictions it involved. When yesterday the Bank of England issued a similar set of warnings about the damage no-deal Brexit will do, the famously courteous Jacob Rees-Mogg dismissed it as “Project Hysteria”, and described governor Mark Carney as “a failed, second-tier politician”.

As a campaigning strategy, all this may very well work. Having been told that the sky would fall once, and seen it stay firmly in place, the voters would be forgiven for thinking such warnings can safely be ignored again now.

Yet, this time is different. Partly that’s because Brexit has yet to actually happen in any serious sense: the past is no guide to the future. Partly, it’s because the Bank of England, unlike Osborne’s Treasury, is a technocratic body not a political one. It may turn out to be wrong – but it would at least be wrong in good faith.

And anyway, the odds are that it won’t be wrong by very much: a no-deal Brexit will mean new trade barriers which will mean less trade. That will make us poorer, with a knock on effect on wages and house prices and the poll ratings of the governing party. That’s without even glancing at the real possibility of food and medicine shortages.

The Brexiteers, intoxicated by their own Koolade, seem sometimes to have forgotten this. A Leave vote didn’t crash the economy, they say, so a no-deal exit can’t possibly do so either. Or perhaps in some cases perhaps they do think there’ll be an economic cost, but also that it’s a price worth paying – or at least a price it’s worth forcing other people to pay.

And in terms of convincing the voters, this may well work: I’ve spent two years waiting for the public to turn against Brexit, but it hasn’t happened, or at least not in the numbers required to shift the political debate.

But winning an argument is not the same as being right – and just because the Brexit elite can convince the electorate that the sky won’t fall, that won’t be enough to hold the sky in place. No-deal Brexit probably will lead to an economic crisis. Once we move from vague, theoretical predictions to unemployment, negative equity and empty shelves in supermarkets, minds may start to change rather quickly. At that point, the words “Project Fear” are not going to impress anyone.

More than one Leaver has compared Remainers’ warning of economic disaster to the boy who cried wolf. But in doing so, they seem to have forgotten the end of that fable: eventually, the wolf showed up. When it did, it wrecked the village’s economy and decimated its food supply, and the fact the boy once lied no longer seemed to matter very much.

Now if you’ll excuse me, I have some very important stockpiling to be getting on with.