Brexit? What Now?

Here's what happens if voters in England decide it's time to leave the European Union

After months of debate, bitterly divided Brits head to the polls on Thursday to cast their votes in an historic referendum whether to leave the European Union. Polls are too close to call.

Those for a Brexit, or “British exit,” want to breakaway from the 28-member European Union and “take back” their country by returning control of British immigration, laws and taxes to Britain. The campaign for a Brexit is led by former London mayor and conservative politician Boris Johnson and the leader of the UK Independence Party Nigel Farage.

Those in the remain camp say leaving the European Union would have major financial consequences on Britain. Prime Minister David Cameron warned of the damage a British exit would have on Britain’s world standing.“If we left, our neighbors would go on meeting and making decisions that profoundly affect us, affect our country, affect our jobs, but we wouldn’t be there. They would be making decisions about us, but without us,” he said.

Cameron’s argument to “remain” is being echoed around the globe. Speaking after a Federal Reserve policy meeting last week, US Fed Chair Janet Yellen said, “It is a decision that could have consequences for economic and financial conditions in global financial markets. If it does so itcould have consequences in turn for the US economic outlook that would be a factor in deciding on the appropriate path of policy.”

Jamie Dimon, head of JP Morgan Chase, which employs thousands of people in Britain, is quoted as saying a Brexit would be “a terrible deal for the British economy and jobs.” That sentiment is joined by billionaire investor George Soros and the head of the European Central Bank Mario Draghi. Renowned economist Nouriel Roubini tweeted, “the Brexit could stall the UK economy and tip it into a recession.”

Global financial markets have been watching Brexit polls closely for weeks now. A vote in favor of a Brexit is expected to cause the British pound to tumble. If that were to happen, it’s believed the Bank of England might stepin and raise interest rates. That would cause borrowing and mortgage prices to rise, which could cause UK home prices to drop. Some economists say Britain’s GDP could decline by more than 2% and that jobs and trade deals would disappear. As for David Cameron: Some say his career as prime minister would be over.

But those pro-Brexit dismiss critics. Some point to Britain’s decision to stay out of the single European currency as an example of British success in going it alone.

Come Friday morning the votes are expected to be tallied and one thing is for sure, change wouldn’t happen overnight. If the vote to exit Britain passes, Britain would then need to negotiate an EU exit plan, which is expected to be a two-year process.