The Brexit result surprised everyone, but it clearly reflects the feeling among many in the UK that they have seen little benefit from EU membership. "Uncontrolled" immigration appeared to be the last straw.

The lack of satisfaction in “the system” has been amplified since the global financial crisis, and it would be wrong to assume this dissatisfaction is only a UK issue. I believe it reflects a huge failure by politicians in Europe – and possibly in the United States – to implement policies to encourage economic growth and wage growth following the crisis.

Looking at the response by authorities – ie politicians and central banks – to the financial crisis, it is evident that quantitative easing (QE) while the correct course of action to offset the contraction of assets (ie money) within the banking system has favoured those in society with assets.

Of course, allowing asset prices to continue to fall unchecked would almost certainly have led to an economic depression, and few will argue that QE has not played a significant role in lifting asset prices post-crisis – equity and property prices. But QE has not lifted incomes.

The other side of the QE coin is that there is no return on bank deposits for savers. They are paying the price for central banks lowering the cost for borrowers who, otherwise, could not afford to carry the debt, including governments.

Bank deposits

However, savers can have little complaint. If the banking systems had been allowed to fail in 2008, not only would shareholders have been wiped out, which they were, along with senior and junior debt holders (who were probably unfairly protected), but ordinary savers’ bank deposits and pension assets sitting on bank and (some) insurance company balance sheets would also have been imperilled.

In Ireland, that included those with savings in Bank of Ireland, AIB and Irish Life & Permanent. Many people don’t seem to understand, or choose to ignore, this fact.

The other response to the financial crisis was austerity. Some was necessary, particularly in Ireland, where a Fianna Fáil government’s overspending from 2002-07 was so inflated it would most likely have led to a fiscal crisis whether we had a banking crisis or not.

But austerity on top of low growth in economies depressed by the weight of debt has led to high unemployment and low wage growth. Those in society without assets are suffering much more than those with assets.

Increased spending

While austerity was necessary at the outset to trim poorly targeted government spending in the lead-up to the crisis, politicians should have moved long ago to implement the second stage of recovery.

The first stage was QE, and the second stage should be fiscal boosting – ie increased government spending aimed at lowering unemployment, strengthening demand and increasing wages. The caveat is that such spending would have to be financed by central banks printing money. So what? Printing money lowers the burden of debt.

Over the centuries, it has been the time-honoured way to get out of a debt crisis. The alternative is to sit around in misery arguing that the next generation should reap the benefits of us flogging ourselves.

The quid pro quo is that any country that prints money to fund additional government spending is likely to see its currency debased. After all, printing more of the same out of thin air leads to a lower price. Within the euro zone, of course, this isn’t proving possible and it is probably the unconscious line in the sand for voters.

The risk now is that other euro zone economies – those suffering high unemployment, low wages and unrest – may follow the UK’s lead and look to exit a system that imposes misery. And despite the euro zone’s worthy long-term goals, such as free movement of capital, goods, services and people, they might just be right.

Euro zone politicians, dominated by Germany, seem incapable of moving to implement the second phase of recovery, most likely because, in a fixed exchange rate regime, it would have to be financed by the strong (ie Germany).

Fairness in society

A key message from Brexit may well be that the risks of a euro zone split have increased if politicians continue to refuse to see the obvious: the general populations want to see an improvement in their lot. Printing money to achieve this favours those with incomes and disadvantages those with assets (as currency devaluations reduce the worth of their assets).

But, in the spirit of fairness, surely it is time to balance the scales back towards those who have suffered the most.

Despite the crisis, capitalism remains the best economic model, but one also must be pragmatic and acknowledge that capitalism misfired leading up to 2008. The arguments are not about whether capitalism is better than socialism; rather, politicians must ensure fairness in society.

If politicians in the euro zone don’t listen, who can be surprised if people start voting to dismantle their “sacred” EU project? That’s the message I take from Brexit.

Rory Gillen is founder of GillenMarkets