When Brexit May Not Be Brexit

by on
Public Policy

Iakov Kalinin/Adobe Stock

I could be committed for heresy for what I am about to write, but it isn’t a foregone conclusion that Britain will leave the European Union (EU).

Participate in MetalMiner’s Budgeting Workshop on July 26 to help set your 2018 metals budget

On the balance of probabilities, a break with the EU is more likely than not. In recent weeks, however, the realization of what leaving the single market will mean to voters’ pockets, not to mention the fiasco of the Conservative government in-fighting, has encouraged some to think a rethink may yet prevail. A second referendum is, while not likely, at least not impossible.

I say heresy because the debate is becoming increasingly acerbic.

Leave supporters, in particular, shout shrilly anytime the topic is raised that “we cannot thwart the will of the people” and to even suggest a rethink is “anti-democratic.” As Gideon Rachman wrote so eloquently in the Financial Times this week, this sounds rather like a third-world dictator, who having unexpectedly achieved a vote in his favour says — “one man, one vote, one time.”

In other words, once a decision has been taken by referendum, it cannot be revoked.

But as Rachman observes, this denies the fact that the electorate was, putting it politely, profoundly misled during the campaign.

Promises Not Kept

Promises were made that Leavers knew could not possibly be delivered upon, yet they found favor with a frustrated electorate desperate to believe there was a better land out there. The marginal majority Leave camp among voters was made up  of two minority factions, according to Rachman.

The larger of the two was a reaction to immigration and for personal or social reasons were less bothered if that had an impact on trade, maybe seeing free trade as something of benefit to other people but not to them.

The second, smaller minority who objected to immigration, to payments into the EU budget, possibly to imposition of European law (although this was unquestionably made an issue by politicians and the media and probably would not have featured in most voters’ concerns) but who still favored open borders and access to the single market. This group was led to believe during the campaign they could achieve those goals while still maintaining open borders for trade – a “have your cake and eat it too” outcome.

The last two months of early-stage negotiations with the EU have shown the EU is having none of that – it’s accept the four freedoms and retain access to the open market or not, and there will be little or no compromise on the core issues. That is not the pain-free outcome Leavers had led voters to believe, vacuous promises that £350 million a week being paid to the EU budget could instead be spent on the NHS were promptly withdrawn after polling day, and it has become obvious a few free trade deals with Australia, Japan or Canada, however welcome, are not going to replace the EU.

As the light has dawned, so have Remain politicians emboldened to speak up. At this stage, they still receive shrill denunciation for even trying to have the debate, but there is more talk of soft Brexit, which for some is a code for no Brexit at all.

Rachman suggests Remainers’ reluctance to speak openly about the idea is because of a minority nationalistic fringe that violently objects to membership of Europe, which he associates the murder last year of British MP Jo Cox to this movement. In reality, it is more likely they fear the torrent of abuse they would receive from their fellow MPs, particularly those who have tied their colors to the mast of the Leave campaign and could not retain any credibility if they were to reverse their previously robust stand or even remain in public office, however flawed earlier arguments are now appearing.

The Debate Beyond Britain

Outside the British establishment, debate is more rational.

Writing in Carnegie Europe, Peter Kellner writes, “It is increasingly likely that Britain will either stay in the EU or reach a transitional arrangement very similar to full membership.”

In June, Prime Minister Theresa May went to the people in a General Election for a mandate to negotiate a strong deal on Britain’s exit. The result was a shambolic failure, leaving her Conservative government relying on the support of Northern Ireland’s Democratic Unionist Party for survival.

In her weakened state, it is hard to see how any of the outcomes she can achieve will be acceptable to the competing camps within her own party, let alone an opposition keen to bring her down. That election in itself suggested a marked change in voter sentiment.

Although there was undeniably strong support from the previously disinterested younger voters as they were bribed by left-wing politicians with talk of free university education (which has also subsequently been quietly backpedaled on — you really cannot take politicians at their word, can you?), there were also many voices raised from a minority that was dismayed by hard-liners saying no deal is better than a bad deal … as if the two were not the same thing.

A hard Brexit is hardly a defining statement, but it is broadly taken as meaning supporters are willing to see the U.K. lose access to EU markets, both for manufactured goods and, worse, for financial services.

In addition, it is becoming clear access to the EU is about much more than tariff barriers. Non-financial barriers, such as passporting rights for financial firms, are actually more of an issue than a 3-5% tariff barrier (which the fall in the pound has arguably already mitigated).

The debate has some way to evolve before politicians, the media and the public can have a serious and sensible debate about what kind of future Britain wants, and whether that would be better-achieved within the EU or outside.

Free Download: The July 2017 MMI Report

But the government’s failure to show any direction, cohesion or capability in the negotiations is making the debate more urgent than not. Its failure is emboldening those within the political establishment to tentatively suggest, as French President Emmanuel Macron recently said, it is not too late to change our minds.

Leave a Comment

Your email address will not be published. Required fields are marked *