Last week at this time, if one is to believe the popular press, the world economy was heading towards Armageddon; and blissfully unaware of it. To hear the popular narrative, one would think that the  stupid voters in the UK, singlehandedly, in the course of an evening, managed to wipe out 20 centuries of Western civilizational progress. There has been talk that voters should be allowed the opportunity to correct their ‘mistake’, that the vote should be ignored, that the government should, by hook or by crook, by any means necessary, find a way to avoid doing what the British people voted for last Thursday.

The howling that has been done from various quarters, such as declarations by singers, actors, and other celebrities that the British people were ‘stupid’, and ‘throwing away prosperity’, or were ‘xenophobic’ says more about those people making the assertions than it does about the voters themselves. Most, if not all, of these celebrities lack training in economics or mass psychology and have no basis for their opinions. They are just parroting what they hear ‘experts’ saying. The experts could be right, or they could be wrong. For example, in 1981 Margaret Thatcher’s economic policies were denounced by 364 economic experts who stated in a letter that, among other things, that her policies would “threaten Britain’s social and political stability”. Certainly the belief that she and her supporters were “stupid” and “throwing away prosperity” was widespread. But history has proven Thatcher correct.

That is not to say that the critics of the Brexit vote are not right today. It is just that a consensus of the experts was wrong then, even though they were convinced otherwise. The saying that “economists have predicted 9 out of the last 4 recessions” is not a testament to their reputation for accuracy

So are they wrong? It is impossible to say right now. In the short run, there is bound to be some uncertainty, especially once negotiations over the “divorce settlement” with the E.U. start. And as the elite were entirely against the Brexit, look for every economic ‘hiccup’ to be blamed on those ‘stupid’ voters. But the idea that the world economy is going to collapse and that we are about to descend into an economic “dark age” is completely without merit for the following reasons:

1.)    The United Kingdom is the world’s 5^th largest economy.

Much of the commentary has focused on the idea that in punishment, Europe will stop trading with the U.K. The image proffered is one where the EU slaps Iran-like sanctions on Britain destroying its economy in the process. Maybe. But as the world’s 5^th largest economy, many countries around the world will be will to trade with the U.K., even if the EU were not. No longer being part of the EU will allow Britain to form its own bi-lateral trade agreements with various countries, instead of being bound by EU rules which may not be beneficial for Britain. Whether future trade agreements are better or worse for Britain than what they currently have will be based on a variety of factors (terms of trade, negotiating skill, etc.). But they need not necessarily be worse. As the world’s 5^th largest economy, Britain can’t simply be ignored.

2.)    The big EU countries are running trade surpluses with Britain.

This means that big EU economies (Germany, Italy, and France, among others) are exporting to Britain than they are importing from Britain. In other words, cutting Britain off from their markets in ‘punishment’ is likely to hurt them more than it will hurt Britain. This means that a Brexit trade meltdown where Britain is cast out into the cold economic world is not likely to happen. And certainly won’t happen if Germany, Italy, and France oppose it.

3.)    The largest British trade surpluses are with non-EU countries.

Of the 10 markets where Britain exports more than it imports, only 1 is an EU country (Ireland at #5). This indicates that Britain is dependent on non-EU countries for the bulk of its export sector. The British export sector is not going to shrivel up and die because of retaliatory EU action.

4.)    The EU regulatory regime is not necessarily the optimal one for Britain.

As part of the EU, Britain has been forced to submit to a regulatory regime that has been produced by negotiations with 27 other countries. The idea that this regulatory regime is optimal for any single one of them is ludicrous. Being free of the EU will allow Britain the ability to craft a regulatory regime more optimal for its specific situation. Whether this turns out to be better or worse than the current arrangement will depend on the skill of policymakers. But policymakers concerned only with the U.K. are likely to come up with a more optimal regulatory regime for Britain than policymakers who have to take 27 other countries into account.

None of this means that the Brexit naysayers won’t ultimately be proven correct. There is a lot nobody really knows. Currently, the idea that the Brexit will be a bad thing for Britain (and that voters were stupid to vote for it) is taken as an unassailable fact. However, that celebrities and other know-nothings parrot what they have heard experts saying doesn’t make it so. And if experts, central bankers, politicians, and prognosticators were truly a bunch of folks who always get it right, then we would not have had the financial crisis and sluggish economic growth over the last 8 years. There are reasons why Britain might be better off out of the EU.

That there will be losers from the Brexit is a certainty. There will also be some winners as well. The howling from the elite indicates that they are pretty sure that the losers will be them.

The year 2016 will likely go down in history as either an oddity, or the start of a major shift in something. This week, the British will go to the polls to vote on whether to make a radical change in exiting the E.U. No matter which way the vote goes, it is a virtual certainty that at least 40% of the voters will vote to leave. Because roughly 60% of current British law is handed down in some way from Brussels, this isn’t a normal statement of not liking the Party in power and wanting the other Party to have a shot. No, this says that at least 40% of the U.K. doesn’t like the current SYSTEM of government and wants a fundamental change. In other words, they have lost faith in the institutions.

The arguments that are being made on the “Remain” side involve assertions of economic problems (or disaster) that will befall the country in Britain votes to “Leave”.  These assertions, to put it mildly, simply aren’t having a large effect (and we will see on Thursday if they move the needle enough to win). At its heart, the reason that the conventional wisdom seems to be having difficulty is that the economic profession simply has forgotten culture in its economic analysis.

For the better part of 3 generations in the West, professional economists have dominated economic policy making. In an effort to smooth the business cycle and/or manage economic shifts, they have developed models, mathematical equations, and statistics to enable them to manage the economy competently. The idea of free trade has dominated policy making circles for over two generations. But the economic models that declare that free movement of labor and resources necessarily lead to economically efficient outcomes tend to assume that all labor is equal. In other words, an influx of foreign labor that displaces domestic labor is not thought of as a bad thing (if the foreign labor is more efficient). The assumption is that domestic labor will then do something else that will lead to overall increased wealth creation in society. The disruption in livelihood of the domestic workers is blithely ignored.

In some ways, this is understandable. After all, it is relatively easy to mathematically measure wages, number of immigrants, lower inflation (from lower wage immigrants pushing down the overall level of wages), etc. Measuring the disruption or feeling of being betrayed by your own government who appears to view immigrants as more deserving of a job than the home folks is difficult to quantify. It is easy to say that people should be tolerant of other cultures, and shame on them if they aren’t. But the fact is that national cohesion and social peace is dependent on people thinking of total strangers like family. This is easy to do if a group of people have had similar experiences or seem similar enough. The feeling of unity that many Americans had on 9/11 was based on a feeling that we had all been attacked. There have been other attacks and atrocities around the world that haven’t hit the American psyche the same way. As horrible as those attacks on foreign soil were, Americans didn’t feel that their ‘family’ had been attacked. National cohesion is indispensable for the modern nation state.

The fact is, economists have forgotten about this. If your cousin loses his job due to foreign competition and you are viewed as an awful person if you complain, it is easy to see why frustration would mount. This doesn’t even take into account the conflicts that will inevitably arise when two cultures clash. Focusing on high level numbers as GDP growth, inflation, the stock market, etc. has historically measured the wealth of society, but is leaves out part of the picture (that of people whose lives have been made economically less secure). As the economics profession has become more mathematically oriented, it is hardly surprising that they have discounted variables that don’t lend themselves to easy mathematical expression.

But these costs are real. And they have been rising. And on Thursday, although Britain may ultimately end up staying in the EU, it appears that the vote will be close. This is the effect of ignoring these costs. The political class (and the economics profession) had better start to take notice. Otherwise, it will continue to lose legitimacy in the eyes of the broader population.

Over the last few weeks as polls have shown that the vote on whether Britain will leave the E.U. to be exceedingly close with the “Leave” crowd gathering strength, we have been treated to increasing amounts of editorializing that a British exit would be a disaster; both for the British and for the world economy as a whole. Even Barack Obama has weighed in and stated that a British exit would seriously impact the “special relationship” that Britain has historically enjoyed with the U.S. The institutional infrastructure has lined up behind the “Remain” campaign, and as of this writing, it is unclear as to whether this will be enough to keep Britain in.

But the question of the whether a British exit would be an economic disaster is one that is far more complex than what the analysis currently on offer seems to appreciate. The sometimes shrill denunciations remind one of the promises of disaster that will befall the world economy if Greece (accounting for 2% of the E.U. economy) were to be forced out of the euro or the E.U. Although the exit of the British economy (which is the world’s 9^th largest national economy and second largest in the E.U. after Germany) would have a significant negative impact on the E.U. as a whole, it is not exactly clear that the long-term impact on the British economy would be negative.

What IS clear is that the current economic structure and Britain’s place within the E.U. is very good for the elites of Britain. For them, unity with Europe and the economic linkages resulting from that, have provided a living, if not wealth/power/status. Naturally, they don’t want a disruption to the status quo. The shrillness of some arguing for the “Remain” camp implies that they believe that an exit would negatively impact them personally.

What is also clear is that there is a significant fraction of the population that doesn’t feel that they are benefitting from the current arrangement. What they do feel in many cases is that they, and the government that they help to elect, has limited control over their destiny. Many feel that their concerns, such as uncontrolled immigration that forces competition for scarce jobs (or drives down their wages), are dismissed and ridiculed as racist by an elite insulated from the effects of the policies that they impose on others. While the magazine “The Economist” dismisses “romantic notions of national sovereignty”, a population that feels disempowered and ignored is not going to care that GDP grows by an extra 1% or that inflation is 2.5% instead of 2%. What they are going to care about is that they feel that they can change things to their benefit through collective action. Simply being told that they have to accept things as they are because an unaccountable, uncontrollable, bureaucracy in Brussels says so (when they don’t feel that they benefit from the arrangement) is a real problem. It is not some imagined problem with an imagined solution.

But this doesn’t mean that a Brexit won’t be economically problematic in the short-term. There is a certain amount of jobs that are dependent upon the current arrangement, and a change in the nature of the status quo will likely mean some economic dislocation. During the recession caused by the financial crisis of 2008, the British economy shrunk by 7.2% from peak to trough. Although problematic and undesirable, it did not mean the end of Western Civilization as we knew it. Were the Brexit to have a similar economic effect, it might be thought of as a small price to pay for the future flexibility that British governments will enjoy not being tied to the E.U. in the same way that they are now.

Also, the sometimes boisterous arguments against leaving could possibly mean that economic problems that caused by an exit are being oversold. The idea that there will be a “sucking” sound as jobs leave for the continent imply that Britain has no economic leverage. In fact, the British GDP represents roughly 16% of the total E.U. economy, which means that it can’t just be ignored. In addition, the fact that Switzerland and Norway have thrived outside of the E.U. means that a British exit doesn’t have to mean a massive economic depression with a lost economic generation on par with Japan.

Whether a Brexit will ultimately prove to be beneficial or damaging economically speaking is really something that can’t be said for certain at this time. Whether any economic dislocation associated with a Brexit turns out to be a transitory phenomenon or a more permanent reduction in GDP will depend on the skill of certain policymakers going forward. However, simply being outside the E.U. is not likely, by itself, to turn Britain into a third class economy. Pretending that it will reflects a blindness, dishonesty, or perhaps both.