A6 SATURDAY, JUNE 25, 2016

Brexit vote probed for clues to November election

Britains Leave crowd

has much in common
with Trump backers,
political experts say
by

Downtown-based Federated
Investors.
Were starting to see populist backlashes all over the
globe. Is this a signal that maybe Donald Trump has a better
chance to win in November? I
dont know, but certainly its
something we want to keep
our eye on, Ellenberger said,
noting political uncertainty
could adversely affect U.S. financial markets.
The demographic profile
of the UKs so-called Leave
faction, which supported exiting the EU, and Trumps
supporters is strikingly
similar, said John T.S. Keeler, dean and professor in the
University of Pittsburghs
Graduate School of Public

TOM FONTAINE

The United Kingdoms historic vote to leave the European Union amid a wave of
populist anger, nationalism
and concerns about immigration could be a harbinger of
things to come when Americans elect a president in November, experts said.
You wonder if this is the
canary in the coal mine, said
Donald Ellenberger, head of
multi-sector strategies for

History of the European Union

The European Union was created by the Treaty on

European Union, which took effect Nov. 1, 1993. Its
executive body is the 28-member European Commission,
which runs the EUs day-to-day affairs, drafts European
laws and, after their adoption by governments, ensures
their enforcement across the bloc. It also represents the
EU in international trade negotiations and conducts
antitrust investigations. 51.9% of the United Kingdoms
citizens voted to leave the European Union on Thursday.
European Union
countries
Sweden
United
Kingdom
Ireland

Finland
Estonia
Latvia
Lithuania

Denmark
Netherlands
Poland
Germany

Belgium
Luxembourg

Austria

France

Hungary

Slovenia

Portugal

Italy

Spain

Croatia

Czech
Republic
Slovakia
Romania
Bulgaria

Greece
Malta

Cyprus

Sources: European Union, TNS, AP and Tribune-Review research

TRIBUNE-REVIEW

Pro-EU Scotland to revisit

independence referendum

BREXIT FROM A1

of 10 Downing St. on Friday

and said he would step down
after championing a failed
campaign.
He promised to remain
as a caretaker through the
summer but said he wanted
Britain to have a new prime
minister by early October.
I will do everything I can as
prime minister to steady the
ship over the coming weeks
and months, he said with
his wife, Samantha Cameron,
standing at his side. But I do
not think it would be right for
me to try to be the captain that
steers our country to its next
destination.
Within hours, it became
clear that whoever does the
steering will have to fight to
keep the United Kingdom
from falling apart. Nicola
Sturgeon, the leader in proEU Scotland, said she would
push for a new independence
referendum.
A 2014 vote failed, but Sturgeon said a rerun of that contest was highly likely in order to protect Scotlands place
in Europe after English and
Welsh voters overrode Scottish
objections and opted for out.

Nationalists in Northern
Ireland another area that favored remaining in the EU
echoed those calls, demanding
a vote on Irish reunification.
But Cameron said he would
not immediately invoke Article 50 of the Lisbon Treaty,
the never-before-used provision that allows EU members
to leave the union.
The decision delays the start
of divorce proceedings with
Britains 27 EU partners. Cameron said that only after the
transition in leadership would
the country begin the formal
process of withdrawing, which
is supposed to take two years
once it officially begins.
It was unclear, however,
whether European leaders
would allow Britain to wait.
Top Brussels officials released
a joint statement urging Britain to take the plunge into
Brexit as soon as possible so as
not to unnecessarily prolong
uncertainty.
Camerons decision to step
down set off an instant contest
to replace him. Former London mayor Boris Johnson a
leading campaigner for the
anti-EU cause was considered the odds-on favorite.

and International Affairs.

Keeler said people from
the two groups are generally
older, more working-class,
less educated and from more
insular or rural parts of their
respective countries. Globalization and the Great Recession adversely affected them,
and their fortunes havent
changed much during the economic recovery, Keeler said.
And both groups have been
led by outspoken celebrity
politicians with wild, blonde
hair: former London Mayor
Boris Johnson and the presumptive Republican nominee Trump.
Lara Brown, director of
George Washington Universitys political management

program, said Trump and

Johnson are not the reasons
people are revolting against
the status quo. They are just
the beneficiaries of much
larger issues that concern
people.
In the UK, the pro-Leave
voters blamed many of the
nations economic problems
on the European Union and
immigration, Keeler said, noting the voters immigration
concerns focused more on
legal, intra-EU immigrants
from other European nations
than on an influx of illegal
immigrants or refugees that
Trump has vowed to stop.
In some ways, Brexit has
been presented as the functional equivalent of the wall

with Mexico, Keeler said,

referring to the barrier that
Trump has promised to build
along the southern United
States at Mexicos expense to
keep out illegal immigrants.
Its been presented as this
almost magical, silver-bullet
solution to the problems (the
pro-Leave voters) face.
Despite the demographic
similarities, Keeler doesnt
predict much of a trans-Atlantic carryover effect.
The Trump supporters
probably like the idea that the
political elites didnt get their
way, but I dont actually think
they should feel that this puts
a lot of wind in their sails,
Keeler said.
Philip Harold, a political

science professor at Moons

Robert Morris University,
isnt so sure.
I think it speaks to people
in democratic countries in
the West feeling underrepresented by the political class,
Harold said, noting that polls
showed the Remain faction
ahead until the referendum
became too close to call in
recent weeks. For them to
rethink that, it means youre
going to have to rethink everything.

Staff writers Salena Zito and

Chris Fleisher contributed. Tom
Fontaine is a Tribune-Review staff
writer. Reach him at 412-320-7847
or tfontaine@tribweb.com.

Firms with U.K. ties short on answers

INVESTORS FROM A1

Calls from nervous investors looking

for guidance about how to handle volatility and clients looking for bargain stocks
kept the phones busy at Fort Pitt Capital
Group in Green Tree, said Kim Forrest,
senior equity analyst at the firm.
But, at this point, there are no certain
answers about the implications from
Britains exit from the EU commonly
known as the Brexit because such a
move is unprecedented. No state has left
the union since it was formed.
Nobody really understands what this
Brexit is about, and they want our take
on it, Forrest said. What were telling
them is that this is going to take a long
time to actually happen. It probably will
introduce some volatility, more than
weve come to expect.
Analysts compared Fridays reaction
in the markets to last August, when the
Dow plunged more than 1,000 points in
a single day before recovering nearly
half of its losses because of concerns
that slowing growth in China would
derail the U.S. economic recovery. Gus
Faucher, an economist at PNC Financial
Services Group, said worries about Britains divorce from the European Union
shouldnt be a significant problem for
U.S. economic growth.
The Federal Reserve said Friday that
it is carefully monitoring developments
in global financial markets following
Britains decision.
U.S. banks have been eagerly awaiting
the Feds decision to raise interest rates
again after the first move in nearly a
decade was made in December. But now
the Fed is unlikely to make another
move before the election in November,
Faucher said.
I think we are likely to see a rate
increase in December, Faucher said.
Well be through the election. Well have
further evidence that the labor market
is doing fine.
Banks and companies with operations
in the United Kingdom were particularly
hard-hit Friday. Financial stocks were
hammered as investors worried about
the impact of currency fluctuations on
their operations and on interest-rate
policy. Global economic malaise could
lead central bankers to keep interest
rates low to spur growth. Two Pittsburgh
banks were among the losers BNY
Mellons stock declined 8.5 percent to
$37.99, and PNC ended down 6.5 percent
at $81.08.
Companies with operations in the
United Kingdom are likely to face severe
impacts. BNY Mellon has 5,000 employees in Britain 10 percent of its global
workforce though it has not said what
the fate of those employees will be.
BNY Mellons Michael Cole-Fontayn
said in a post to the banks website on
Friday that it is ready to play a constructive role during this transition
period.

Exit heard around the world

Great Britains vote to leave the European Union weighed heavily on global
financial markets, with most exchanges dropping at least a couple of
percentage points.

United Kingdom FTSE 100 -3.15%

DJIA -3.39%
Germany DAX -6.82%

China Shanghai
Composite -1.30%

France CAC40 -6.24%

Hong Kong
Hang Seng -2.95%

Mexican Bolsa +0.74%

Japan Nikkei -7.92%

Brazil Bovespa -2.82%

Sources: CNN Money, Tribune-Review research

The outcome of the referendum

is disappointing. Global
integration has created security/
wealth for most nations. We must
be encouraged to continue on this
path and create a better future
for the next generations.
KLAUS KLEINFELD
ALCOA CEO, IN A TWITTER POST

We have the flexibility and resources

to adapt to any necessary infrastructure
change which may be needed as a result
of the formal U.K.-EU relationship, said
Cole-Fontayn, BNY Mellons Chairman
of Europe, Middle East and Africa.
JPMorgan has more than 16,000 employees in Britain and does a lot of crossborder business in Europe from its base
in London. CEO Jamie Dimon warned
the investment bank would have to cut
some of those jobs if Britain left the EU.
Pittsburgh companies exported
$2.1 billion in goods and services to
European Union nations in 2014, according to the latest figures available
through the Pittsburgh Regional Alliance.
Aluminum maker Alcoa has significant operations in Europe. More than a
quarter of its $23.9 billion in sales were
in European countries, with $464 million of that in the United Kingdom. The
company has at least a dozen plants
in Britain that make products for the
transportation and energy industries.
CEO Klaus Kleinfeld took to Twitter
on Friday to express his disappointment.

E. DENISE SHEAN | TRIBUNE-REVIEW

The outcome of the referendum

is disappointing. Global integration
has created security/wealth for most
nations, Kleinfeld said. We must be
encouraged to continue on this path
and create a better future for the next
generations.
While investors stomachs may be
churning, Britains break from EU oversight could ultimately be a positive for
consumers, said Antony Davies, an associate economics professor at Duquesne
University.
Britains exit could force the EU governments to be less heavy-handed in
putting up trade restrictions and force
them to become a nicer, gentler government because it would be worried that
other countries could follow Britains
lead, Davies said.
Any time you get the governments
involved, pretty much the only thing governments can do is restrict that trade,
Davies said. Now theres competition.
If we want to buy something from Europe, we have two sets of governments.
Trade agreements between Britain
and EU nations will be negotiated over
the next couple of years. There are concerns that the EU will move to punish
Britain by imposing strict barriers.
However, Britain buys more goods
than it exports and the EU would be wise
to treat it fairly, said Donald Ellenberger,
senior portfolio manager at Downtownbased Federated Investors.
Theyre a good customer, Ellenberger said. Because theyre a net importer,
other countries are going to be very
much (incentivized) to get those trade
agreements done so they can continue
to sell into the U.K.

Chris Fleisher is a Tribune-Review staff writer. Reach

him at 412-320-7854 or cfleisher@tribweb.com.

State of emergency declared in 44 W.Va. counties

FLOODING FROM A1

screams, tried to help save

the boy but were also unable
to reach him.
In Elkview, about 30 minutes north of Charleston, the
state capital, the raging Elk
River destroyed the only road
in and out of The Crossings
shopping plaza, stranding
Smith, 25, of Charleston and
hundreds of others.
The West Virginia Division
of Highways built a gravel
road Friday, and people finally
drove to freedom around 9:30
p.m.
Smith said people slept in
their cars after all the rooms at
the La Quinta Inn and Suites
in the plaza were booked. They
socialized. A Bob Evans restaurant gave out food.
No one could sleep, said
Smith, 25, of Charleston. People were scared.
Smith was able to leave the
plaza Friday by walking down
a steep hillside and crossing a
bridge that hours before had
been under water.
She went to check on her
family in nearby Frame. Their

where the Elk River left most

of the town under water. A
helicopter idled just off of I-79
waiting to help with rescue
missions.
Two hundred National
Guardsmen were assisting
in eight counties, helping local crews with swift water
rescues, search and extraction efforts and health and
welfare checks. The governor
declared a state of emergency
in 44 of 54 counties and authorized up to 500 soldiers to
assist.
The governor said he had
planned to fly around the
hard-hit areas, but wasnt
able to because all state aircraft were being used for
rescues.
A historic resort located in
one of the hardest-hit areas of
flooding has closed to guests
until further notice.
AP
The 710-room Greenbrier
Jimmy Scott gets a hug from Anna May Watson as they clean up Friday from severe
resort sustained damage from
flooding in White Sulphur Springs, W.Va. Scott lost his home to the flood and a fire that
the flooding and was using
consumed his home and the homes of several relatives.
backup generators Friday, according to a post on its FaceThey live up in a holler, and all in the creek.
house was flooded. They dont
book page.
Police blocked off the roads
have electricity or water, but there aint no road anymore,
The resort is in White SulSmith said. The blacktop is leading to nearby Clendenin, phur Springs in Greenbrier
everyone is safe, she said.

County, which is owned by

billionaire Democratic gubernatorial nominee Jim Justice.
The resort posted photos of its
golf course covered in floodwaters.
The course, overrun by
floodwaters, is scheduled to
host a PGA tour event from
July 4-10.
Its like nothing Ive seen,
Justice said in a statement.
But our focus right now isnt
on the property, golf course
or anything else. Were praying for the people and doing
everything we can to get them
the help they need.
Professional golfer Bubba
Watson was apparently visiting the resort and tweeted
photos of entire holes underwater: Prayers for (at)The
Greenbrier & surrounding
areas. We are without power
& its still raining. Never seen
this much rain! #WestVirginia
BeSafe.

Aaron Aupperlee is a Trib Total Media

staff writer. Reach him at 412-320-7986
or aaupperlee@tribweb.com. The
Associated Press contributed.