Just a little local difficulty?

The neoliberal, forced globalisation model has failed these people.

To tell a lie, you have to know the truth. In their anger and anguish, the commentators, pundits, politicians, experts and so on who have railed against the ‘‘lies’’ and misrepresentations made by the proBrexit lobbyists miss this point. The only truth is that nobody knows what the truth is with respect to what happens to Britain and the rest of us as a result of this referendum.

Why? The reason is the same as for all major human endeavours – the great Keynesian insight: what will happen depends on what people expect to happen, and what they then choose to do.

From a narrow economic perspective there actually is a truth, which is simply that Britain – or England and Wales – could function perfectly well as a modern, prosperous economy outside the European Union, just as most prosperous countries in the world – large and small – already do.

Whether it is allowed to do so and how painful the process is will depend on how people handle themselves and each other. We have already seen people behaving badly in the financial markets, with drops in share prices and in the value of the pound. Look on the bright side: these turmoils are a great way of transferring billions of dollars of wealth from short-sighted, panicky people to the shrewd, far-sighted, steady ones – the ‘‘buy low and hold’’ investors such as Warren Buffett.

That’s an improvement in resource allocation, yes?

Of course it won’t be a simple process to unravel much of the UK’s involvement in Europe. But it can be done well or done badly. It’s up to the politicians on both sides – however sad they are – to behave constructively from now on.

That said, we cannot ignore the reasons behind this remarkable vote, and its ominous similarities to the even more remarkable support in the US for Donald Trump.

Basically, the indigenous white working and lower-middle classes in both countries are fed up. They are fed up with being told how stupid they are by ‘‘elites’’. They are fed up with almost stagnant real incomes and backsliding employment and social conditions over the past three decades. They are, obviously, fed up with foreigners coming into their country and (they believe) competing for their jobs.

The neoliberal, forced globalisation model has failed these people. For economists and politicians, the responsible thing to now do is to begin building what the American economist Robert Summers calls a ‘‘responsible nationalism’’, that takes nations seriously as economic and social entities, rather than – as now – as standardised grist for the globalisation mill.

That applies to us in New Zealand too. We aren’t so worried here about immigration, but we also have citizens who have suffered three decades of disappointing wages and employment insecurity, along with spiralling housing and education costs.

With just 4 per cent of our trade being with the UK, events there may seem a little local difficulty from our perspective, but the pervasive undercurrents of disillusion and despair will soon enough wash against our island shores. Tim Hazledine is professor of economics in the University of Auckland Business School.