Brexit Breakdown — What the Heck is Brexit?

What a yes or no vote on June 23 in Britain means for the United States.

what is brexit

On Thursday, June 23, the United Kingdom will hold a history-making vote on whether to remain in the European Union (EU) or exit the 28-country group. Find out how the outcome of this referendum could impact Americans.

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What the heck is Brexit?

First things first: What is it exactly? Brexit — a combination of Britain and exit — is the term coined to describe the U.K. potentially leaving the EU. Polls are currently showing a near 50/50 divide between Great Britain residents, but those in favor of leaving the EU countries believe the money the U.K. gives to the EU — $16.3 billion in 2014 — could be better used elsewhere and don’t agree with many EU rules and regulations, according to CNN.

Many Brits, including Prime Minister David Cameron, are starkly opposed to Brexit, claiming it will cause the U.K. to enter a recession, negatively impact jobs and crash the housing market. Additionally, Scotland is adamant about not leaving the EU, threatening to hold a vote and declare its independence if Brexit passes.

What does Brexit mean for the U.S.?

If passed, Brexit will have major implications for the EU, but its impact will also be seen in the U.S. Take a look at what might happen if the U.K. votes to leave the EU.

U.S. TradeU.S. EconomyU.S. Foreign Policy ObjectivesU.S. War on Terror
If Brexit vote is NO
  • No change
  • Increased interest rates
  • Britain could expand its influence in the EU, benefiting U.S. foreign policy
  • No change
If Brexit vote is YES
  • America would have to sign a free trade deal with the U.K. to continue business as usual
  • Transatlantic Trade and Investment Pact (TTIP) deal won’t happen
  • Weakened economy
  • Interest rates stay steady
  • The U.S. loses their closest ally in the EU
  • U.S. won’t  be able to better align other EU countries with U.S. foreign policy
  • Because the U.K. and the U.S. have a history of sharing intelligence, this could weaken the security of other EU countries

What does Brexit mean for you?

Brexit is a U.K. referendum, but it could influence the lives of Americans. From interest rate hikes to possible job loss, learn how this could possibly impact you if you’re living in the U.S.

The Value of the U.S. DollarTraveling Outside the U.S.U.S. Job MarketCredit Availability in the U.S.
If Brexit vote is NO
  • Increased interest rates
  • Boosted retirement accounts
  • Raised mortgage rates
  • American dollar won’t go as far abroad
  • No change
  • No change
If Brexit vote is YES
  • Fed might hesitate on increasing interest rates
  • Mortgage rates tumble even lower
  • Retirement accounts plummet
  • American dollar to go even farther abroad
  • Exports become too expensive
  • Some Americans could lose jobs
  • Banks limit available credit
  • Small businesses and consumers suffer

Only time will tell what will happen to the U.S. and global economy if Brexit happens. Check back Thursday to see if the U.K. voted to pass Brexit or if it will be remaining in the EU.

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