September 16, 2016

The Folly of Brexit

REUTERS/Luke MacGregor
Pro-Europe demonstrators protest during a "March for Europe" against the Brexit vote result earlier in the year, in London, Britain, September 3, 2016.
Pro-Europe demonstrators protest during a "March for Europe" against the Brexit vote result earlier in the year, in London, Britain, September 3, 2016.

The result of the 23 June referendum on the UK’s membership of the EU was as unexpected in Britain as it was in continental Europe.

Within 48 hours, it became clear that the leaders of the Leave campaign had no idea how to navigate the vortex of uncertainties that their victory had produced.1 Within a week, one of their most strident standard-bearers, Boris Johnson, abandoned his prime ministerial ambitions with a whimper.
Yet since her virtual coronation as prime minister on 13 July, Theresa May has turned the page with elan and authority. A subdued supporter of “Remain” in David Cameron’s government, Mrs May has entrusted two dyed in the wool Eurosceptics with negotiating the parameters of a post-Brexit UK: David Davis (who became Secretary of State for Exiting the European Union) and Liam Fox (the first-ever Secretary of State for International Trade). Her appointment of Boris Johnson as Foreign Secretary, though with a much diminished remit, dazed and dumbfounded nearly all.
By these means, Britain’s new prime minister has given force to her pledge that “Brexit means Brexit”. But she has done so in a way that will oblige her Eurosceptic colleagues to share responsibility for terms of exit that are bound to disappoint a substantial block of their supporters in the country. By giving Boris Johnson a post that forces him to improve his act, she has partially neutralised him. Those with a claim to “know better”, David Cameron’s “Notting Hill set”, have been put out of the way, and the most irreconcilable and treacherous of her former rivals, Michael Gove, has been banished. With a few bold strokes, she has secured party unity on her own terms.
The critics’ charge is that she, like David Cameron, has put party unity ahead of the national interest. But a more considered assessment might be that, unlike David Cameron, she bears little responsibility for the referendum result, and she is right in her view that a united government is needed to limit the inevitable disruption and damage that Britain’s withdrawal from the EU will create. That it will remain united, however, is much in doubt.
Just how aware Prime Minister May is of the geopolitical implications of Brexit remains to be seen. Her predecessor, a one-time Eurosceptic, came to terms with these issues late in the day. He and his Chancellor of the Exchequer, George Osborne, conducted a campaign that was both narrow and negative. In what became, in the words of the Leave campaign, “Project Fear”, the electorate was treated to a cascade of warnings about the economic costs of British withdrawal. The more lurid the suspiciously precise statistics became, the more sceptical the public grew about the government’s case and the more appealing became the leitmotifs of Brexit: “sovereignty” and “control”. These nostrums were poorly contested; about security, Remain offered little beyond cliché. By insisting that “we” could veto this and “we” could veto that, Cameron reinforced the belief that “we” stood on one side and “they” on another. In essence, both Leave and Remain campaigned against the EU.
Time is likely to show that the gain in sovereignty promised by Brexit proponents will exact a disproportionate cost in terms of European and global influence. The case for Brexit rests on the assumption that Britain on its own can define the terms of its engagement with the outside world. This is an assumption based on a dated caricature of the EU and a misunderstanding of the sources of British influence. No matter how wisely the negotiations are conducted, Britain’s withdrawal from the EU has the potential to damage the UK, Europe and the security of the West as a whole. In four respects, the perceptions of those who championed Brexit are out of kilter with reality.
First, the EU is not the mastodon widely portrayed by its opponents. In comparison to the period before its eastward enlargements, it has become a different organism: diverse, irrepressibly pluralistic and on the cutting edge of elemental issues affecting Europe’s security and way of life. In all of these respects, but particularly the last, the EU of today bears more comparison in its ideals and challenges to the European project of Schuman, Monnet and Adenauer than it does to the ingrown, self-referential construction that fell into place following de Gaulle’s veto of Britain’s entry in 1963. The ethos of dirigisme—not to mention the ostentatious elitism exemplified by Giscard d’Estaing and Edward Heath—has not disappeared. But it has lost its dominance and until the referendum was firmly counterbalanced by the UK and a majority of Scandinavian and Central European member states. The “six” can issue declaration after declaration about political union and even a European army. But the former is no longer possible, and the latter never was. Within a common framework of values, rules and institutions (whose powers are limited as well as shared), the EU has become variable in its geometry, a marketplace of ideas and a union of nations that remained nations. It cannot be otherwise if it is to exist at all.
Second, whatever the pretensions of some and the nightmares of others, a European superstate there never was and cannot be. What kind of superstate could have tolerated the inbred pathologies that drove the Greek economy to ruin? Far from being a lesson in the hubris of EU micromanagement, the Greek crisis is, amongst other things, a commentary on the ineffectiveness and lack of authority of EU institutions. For everyone, there is food for thought here, but it will only take place if the UK and EU discard dogma, Eurosceptic as well as Europhile. A moment’s reflection will show that the real divide is not between “new” and “old” Europe, pace Donald Rumsfeld, but between the competitive, meritocratic and fiduciary culture of one Europe and the paternalistic, syndicalist, populist and profligate economic culture of the other. Loosely speaking, it is a north–south rather than an east–west divide, but a divide it is (which in France cuts right across the polity and in Britain right across the Labour Party). It distinguishes those who, when presented with a bill, pay it and those who ask “where is your vision?” (NB There is no contradiction between a fiduciary culture and a welfare state. Denmark has a comprehensive welfare system, but it is paid for—by one of the highest tax rates in Europe.)
Third, “Britain in Europe” did not diminish Britain’s potential. On the contrary, it has added value to Europe and thereby to Britain itself. As it has often done throughout its history, the UK preserved the European balance or corrected it. For Angela Merkel and Wolfgang Schäuble, it is the UK, not France, that has been Germany’s ally of choice. With the UK, Germany has been able to play its role as the bulwark of fiduciary Europe and reinforce the proponents of sound finance in France, Italy and Spain. Without the UK by Germany’s side, the ship will list. A British voice has also made a difference in those places (e.g. Warsaw, Budapest and Athens, not to mention Istanbul and Kyiv) where a German voice has aroused resentment. In all matters of EU competence with a security dimension (see below), the UK has been a critical, often pivotal player, stiffening backbones, reinforcing confidence and calming nerves. From the start of the enlargement process to the first mooting of Brexit, the UK not only “punched above its weight” in European councils, it also drove agendas, firmed up coalitions and blocked a good deal of nonsense. Surely, this did not diminish Britain or damage its interests.
Fourth, it is spurious to say that the security of the West rests on NATO and NATO alone. For one thing, NATO does not agree. Defence and deterrence have been redefined, latterly (since 2014) in Europe itself, and NATO is keeping pace with these changes. But NATO remains a hard-power animal. Well before we were presented with the challenge of “hybrid warfare”, we found ourselves confronting security issues—energy supply, trans-national crime, financial regulation and the securitisation of culture and information—where NATO has little to contribute. NATO membership for the Visegrad countries and the Baltic States offers a guarantee of defence against ultimate threats and provides a baseline of political confidence. But it is the EU that has integrated these states into European markets and the institutions of liberal democracy. It is the EU, not NATO, that takes the lead on security-sector reform (security, counterintelligence, police), that funds critical infrastructure development and helps new democracies strengthen institutional capacity against penetration by Russia’s economic mega-actors, security services and “humanitarian” foundations. In many of these spheres, the UK has been a key participant; in others it has led the way. Nobody’s security will benefit from the diminution of these ties.
On one point the United States and Russia are in firm agreement: the UK is a force multiplier in the EU and a pillar of Atlanticism inside it. It is as a European power that Britain has strengthened Atlanticism. With Britain outside, the Atlanticist impulse will weaken, and other impulses will make themselves felt. On 9 June, the French Senate declared overwhelmingly (by 302 votes to 16) that relations with Russia, “confiantes et solides”, are “indispensable”, and the sentiment is strongly echoed within Sigmar Gabriel’s SPD, not to mention the Kremlin. For many Brexiteers, the “special relationship” is an article of faith, but for many in Washington it has a more dispassionate and instrumental importance. Post-Brexit, a special relationship will survive in defence and, certainly, intelligence. But the UK’s withdrawal from the EU signifies a decline of US influence in Europe, and it is not clear that Anglo–American relations will benefit.
What, then, are the consequences likely to be? It would be cavalier to dismiss the uncertainties ahead. There is only one certainty: the UK’s official status will not change until Article 50 of the Lisbon Treaty is invoked “in accordance with its own constitutional requirements”. Constitutionally, Parliament is sovereign in the UK; the people are not. But Cameron’s government promised a binding referendum, not an advisory one, and Parliament consented, passing the European Union Referendum Act in December 2015. In constitutional terms, Parliament has already endorsed the referendum verdict. Prime Minister May has wisely said that Article 50 will not be invoked until 2017. The difficulties of arriving at a coherent British negotiating position will compound delays, taxing the patience of the 27 other EU member states. But its invocation is a near certainty. Despite a major court challenge, it is most unlikely that the act will be undone.
The sequel to Article 50’s invocation will be a prolonged negotiation over the terms of British withdrawal. That negotiation is most unlikely to take place with a monolithic European Union. The wishes of an influential core of European players to secure a clean and swift divorce are already being opposed by a number of others, not least Angela Merkel, who has—most recently in Tallinn—also called for listening, understanding and patience regarding the EU’s future direction.2 This is only prudent. Behind current differences over Brexit are more submerged divisions over the scope, depth and pace of European integration, not to mention the geographical limits of “Europe”. The Brexit negotiation can be expected to bring these divisions to the surface. At worst, it could strengthen other centrifugal tendencies in the EU that already arouse concern and despondency. At best, it could lay the ground for a more concentric or loosely networked geometry of European integration that would revise not only Britain’s terms of engagement, but Norway’s and Switzerland’s as well. But that is for the long term. In the short term, we are likely to see confusion and stress.
However the process develops, it will take little time to expose the vision of the Brexiteers as a sham. The siren song of Brexit was that, outside the EU, Britain could maintain the free-trade provisions of the Single Market without its regulatory provisions (EU “red tape”) and without free movement of labour. Sooner rather than later, the UK will find that it confronts a Hobson’s choice: a “sovereign” Britain paying the EU external tariff—with all the adverse consequences that this will have for inward investment—or Single Market benefits with Single Market obligations, but without a member’s right to shape the rules that it must observe. Under the stewardship of Theresa May (who is well respected in Europe), Britain’s economic weight should allow it to negotiate a softer Hobson’s choice, with better terms than Norway (which incorporates 80% of EU regulations into its domestic legislation). But “benefits without obligations” is not an option, and any substantial compromise will entail a substantial dilution of core Brexit principles.
What are the consequences for Europe’s security likely to be? The least likely outcomes are a “federal Europe” or a German–Russian condominium. The more probable result will be a misery and a mess. No state or combination of states will find it easy to prevent lines of tension turning into cleavages. Restraints on extreme forms of national and economic “protection” are bound to wane. The risk is that disintegration will progress de facto, even if integration proceeds de jure.
In this setting, Russia, ever at ease with instability, will plot and profit. But the Kremlin is hardly going to be, pace Stalin, “dizzy with success”. Brexit is not an unalloyed blessing for Russia’s elites. Quite a number of Russian oligarchs have made a strategic investment in the British economy, believing they were gaining advantage (and immunity) in the European economy as well. Yet since returning to the Kremlin in 2012, Vladimir Putin has bestowed favour on the tribunes of home-based capital (hydrocarbons, railways, defence) rather than those who sought reward and refuge in the global market. The concerns of the defence establishment are more adamantine and compelling: that a weaker EU will play to the advantage of NATO. To all appearances, the NATO summit in Warsaw followed this script.
Yet, as any good Leninist knows, history advances “one step forward, two steps back”. But it advances. Despite their assiduous exploitation of contradiction and division, Kremlin policymakers never entirely lost their conviction that NATO and the EU were governed by the same American nervous system. Their determined cultivation of European business during the years of Brezhnevian “détente”, Gorbachevian “new thinking” and post-Cold War “strategic partnership” diminished this neuralgia, but EU enlargement revived it even before the Eastern Partnership brought it to fever pitch. Russia’s brutal pressure on Ukraine and Armenia to abandon their quest for EU Association Agreements was applied against a non-bloc state and a member of CSTO respectively. Europe’s Common Security and Defence Policy (which, to the surprise of its most zealous adherents and opponents, brought the EU and NATO closer together) only reinforced Russia’s view that EU and NATO enlargement were two emanations of a common encroachment upon its geopolitical and “civilisational” space.
Britain’s withdrawal from the EU will diminish that apprehension, along with many of the linkages that make “the West” a meaningful term. Preoccupied by Brexit and its own future, the odds are that EU attentiveness towards Ukraine and other vulnerable neighbours will slip, that its unified stance on sanctions will be ever more tenuous, and that enlargement policy will be consigned to the archives, whilst the temptation to seek “normalisation” with Russia will increase. The dilemma for the Kremlin is whether to sit back and enjoy the fruits of EU introversion (and its possible disintegration) or use the moment to strike a decisive blow against European “partnerships” and a “bankrupt”, “corrupted” Ukrainian state.3 In the post-Brexit world, the EU’s ability to influence this choice is almost certain to decline.
Yet, as Russia’s military establishment is all too aware, the wild card in this matrix is NATO. Were Sweden and Finland, on the basis of the foregoing conclusions, to chart a path towards NATO membership, the Kremlin’s calculations would be thrown into reverse. Whilst the NATO Warsaw summit communiqué did not go this far, its language is nonetheless suggestive:
[S]ince 2014, the Alliance has developed mutually beneficial partnership relations with Finland and Sweden on a broad range of issues. We appreciate the significant contributions of Finland and Sweden to NATO-led operations. We are dedicated to the continuous process of further strengthening our cooperation with these enhanced opportunities partners, including through regular political consultations, shared situational awareness, and joint exercises, in order to respond to common challenges in a timely and effective manner.4
Yet more suggestive is the fact that, on these points, the Declaration at NATO’s summit in Wales (September 2014) said nothing at all.
Swedish and Finnish membership of NATO is conjecture and, however realistic, distant. The challenges posed by Brexit are imminent. Whilst they are unlikely to be catastrophic, they do weaken the West at a time of deep geopolitical uncertainty. Whatever the ultimate outlook might be, few dispute that in the near to mid-term they will have a negative impact on Britain’s economy, and Europe’s as well. That Britain, shorn of EU regulation and “common policy”, will enhance its own position in the world is arguably the most fanciful claim of Brexit’s supporters. The opposite is far more likely to be the case. Deprived of “bloc” negotiating power, the UK will be forced into an ever more commercialised foreign policy, geopolitically myopic and self-deterring, for fear of offending those from whom trade deals and foreign investment are sought. Already, there are hints that Britain might seek to “normalise” its relations with Russia.5 Defence spending, once again on the rise, is likely to come under renewed pressure as growth declines and budgets become tighter. Far from “punching above its weight”, Britain will find itself weighed down by the need to navigate the world’s economic shoals on its own.
Since the launch of the Brexit campaign, its leaders have asked the country to “have faith in Britain”. What they meant was “have no faith in others”. This is a dispiriting “faith”, based on a misreading of history as much as the contemporary world. “Splendid isolation” is not an option in today’s world. Even at its imperial apogee, the UK abandoned it whenever a major threat appeared on the continent. Real isolation (1940) was “our finest hour”, but it did not come about by choice, and the British were pleased by 1941 to find themselves with allies. Today they need allies on the soft and unconventional security issues as much as on the hard and tangible ones.
Britain’s strength derives from the power it exercises in combination with others and the goodwill that arises when it does so. Whether goodwill and usable power can be reconstituted in a post-Brexit world remains to be seen. But even if it can, the enterprise will demand more tenacity and wisdom from the British than they have shown of late.
______
1 The driving force behind the campaign to leave the EU, Nigel Farage’s UK Independence Party, campaigned on its own rather than within the official Vote Leave campaign, which was dominated by disaffected figures associated with the governing Conservative Party.
2 Reuters, 24 August 2016.
3 Sergey Naryshkin, <Naryshkin rasskazal o perspektivakh Ukrainiy v voyne s Rossiey>, Lenta.ru/news/2015/07/23/narishkin_war. In the same interview, Naryshkin opines that in any serious military action, Ukraine’s armed forces would be unable to continue beyond five days.
4 Warsaw Summit Communiqué, 8–9 July 2016, Pt 23, para 2.
5 “Boris Johnson says Britain must ‘normalise’ its relations with Russia”, Daily Telegraph, 11 August 2016.

Opinions

Martin Helme, MEP (Conservative People’s Party of Estonia)

A large part of James Sherr’s article leaves the impression that the Brexit vote did not happen and, moreover, that the developments following it do not exist. He lists a number of reasons why Brexit is bad, as if the decision could be somehow influenced today. Another important aspect that caught my eye is that most of the anti-Brexit arguments he reiterates did not convince the majority of the British public—they still voted to leave. At times one gets the impression that the author has not managed to accept the results of the referendum.
I also noticed that the so-called Project Fear arguments that the stay campaigners eagerly broadcast before the referendum did not materialise. It is true that the markets suffered a considerable fall and the value of the pound decreased drastically in the first days and weeks. At the same time, the UK’s employment rate, economic growth, export volume, stock exchange indices and consumer confidence index are the envy of other states in the EU and can be said to be impossible to emulate. Even the supporters of Brexit could not have dreamt of such a positive situation. Good economic indicators are undoubtedly the result of the pound falling. A weaker pound is just what the doctor ordered for the British economy!
The second half of the article, where the author writes about the future, is more interesting. I do not share his pessimistic view about the United Kingdom not being able to achieve reasonable terms for exit or a new network of relationships. Yes, theoretically the state needs to negotiate with 27 countries, but we all know that this is not how things work in the EU. Germany’s position and the support of medium-sized states will be decisive. Germany undoubtedly won’t be a generous and easy-going negotiating partner but it is interested in pragmatic and workable solutions. This side will definitely include states that count the UK among their security as well as economic partners.
To top it all, people tend to forget that the United Kingdom has levers that it can use. In the end, London might not choose the Norwegian (or Swiss) model but isolate itself fully from the EU’s system of agreements and trade on the basis of the WTO’s general terms and conditions. This is not the best solution for all parties but it would create a situation in which Britain could concentrate on the fields and states that interest it. By the way, the author is mistaken in writing that Norway incorporates 80% of EU regulations into its domestic legislation—in fact, Norway has assimilated that percentage of EU directives but it does not do so with most EU regulations. According to Norway’s own calculations, it has incorporated 1,369 out of 1,965 directives, and only 1,349 out of 7,720 regulations.
Supporters of Brexit claimed from the start that, after the uncertainty and setbacks subsided, the UK would have excellent opportunities for rapid growth. The months following the referendum have shown that the setbacks were smaller and their impact ended sooner than even the greatest optimists had hoped. The fear that the UK will isolate itself is unsubstantiated, while European federalists should certainly be afraid that the UK will be successful, as it has been freed from the EU’s shackles.

Sven Mikser, Social Democratic Party member of the Riigikogu (Estonian Parliament) and Chairman of its Foreign Affairs Committee

Although Winston Churchill was one of the creators of a united Europe, the British have always been more wary of European integration than people in mainland Europe. I suppose that the UK being an island nation and its imperial past both have a role in this. There is no way of finding out for certain whether the referendum result was influenced rather by voters’ dissatisfaction with their socioeconomic status and current developments in Europe or by the Euroscepticism that has taken root over several decades. However, David Cameron definitely did not foresee the fatal concurrence of the refugee crisis and the wave of terror attacks that hit Europe as he announced the referendum.
Including leading figures of the Leave campaign in the government is a cunning step in internal policy and shows Theresa May’s powerful style and political experience. Nevertheless, it is not our business how the British Conservatives will share the responsibility for the consequences of Brexit.
I agree that leaving the European Union will diminish Britain’s global influence in the long term. This is problematic for Estonia primarily from the security perspective. The economic impact of Brexit may start to have a negative influence on the defence budget as well, but I believe that Britain’s ability to contribute to Europe’s military security will not diminish dramatically. What will happen, however, after Britain exits the EU, is that the field lines within the European Union will shift in a way that is not conducive to the security interests of Estonia and, more broadly, our entire region.
The fear that Brexit will encourage centrifugal forces in mainland Europe will undoubtedly influence the upcoming negotiations. On the one hand, all conservative political forces in Europe wish Britain’s exit to be smooth and not create large-scale economic disruption; on the other, the leaders of the remaining core of Europe do not want Brexit to set an example to be followed by the continent’s Eurosceptics.

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