What next on Brexit?

During the last year, my thinking about our relationship with the European Union has been evolving. I remain convinced that leaving is a major act of political, social, and economic self harm (in that order), which will damage most many of those who voted to leave. This is a (long) account of my views. I have written it against the background of a debate in the Broadland Constituency Labour Party about what the Party should do, but has wider implications.

A political project

For me, membership of the European Union is about values, peace and solidarity with our friends and neighbours. The European Union is probably the most ambitious political project ever attempted. It set out to create a community of shared values, among countries of widely differing sizes and cultures, operating in 24 official languages. Above all it set out to prevent Europe sliding back into the internal warfare which had been the norm for centuries, culminating in the horrors of two twentieth century wars. Since its creation we have seen the establishment of democracy across all the member states, and the longest period of peace in Europe since the Roman Empire. No one under 80 today has any real experience of what it was like to live with war, and we have come to think of peace as normal: it is not: we live in an increasingly dangerous world, where we need friends, not enemies.

One of the strategies of the Brexit campaigners, over the decades they have been fighting the battle, is to claim that the EU is fundamentally an economic union, and can therefore be judged by economic outcomes: a weighing of costs and benefits. But this is a (deliberate) mistake.

The EU was founded on a set of fundamentally social democratic values. It supports democracy, citizens’ rights, equitable treatment of countries and organisations. Through the EU, the member states agree major, overarching goals for public policy. It recognises the role of government, at regional, national and European levels in regulating markets and ensuring fair treatment for all players. It aims to address big and complex issues which extend beyond the boundaries of nation states, like climate, demographic, technological and industrial change. It also aims to make it easy for people throughout the Union to behave as if they were in one country, with no barriers to movement, working and living.

A democratic institution

In any democracy there are competing views, interests and strategies. Good governance depends on maintaining a delicate balance between majority and minority interests, and between member states and the collective Union. Of course, it cannot always satisfy everyone. Complex compromises are essential. Sometimes this involves long implementation timescales, sometimes exceptions are made for individual member states. Reaching agreement with all the parties and countries can be mind numbingly slow and tedious, but is still better than war. Inevitably disputes arise about the interpretation of EU laws and regulations, and The European Court of Justice (to which each member state appoints a judge) exists to adjudicate on such disputes.

Negotiating and agreeing solutions involves complex work by the EU’s civil service, the Commission (which is a relatively small for the size of the task: about the size of a middle sized UK Government Department). Sometimes the Commission funds research to understand the challenges and possible solutions.  Where solutions call for significant legislation or regulation, the decisions are taken jointly by the member states (through the Council), and the elected Parliament. To pass, legislation must be supported by a majority of countries, representing a majority of the population, as well as a majority in the Parliament. Over time, the processes and institutions have evolved to increase transparency, accountability and democratic influence.

The Euro is a special, and difficult issue in the debate on the EU. In retrospect, many believe that it was a mistake to set it up without an accountable democratic system of governance, and the UK was certainly wise to opt out (another example of how the EU can adapt to a particular nation’s issues). The result has been inappropriate lending policies followed by the imposition of punitive regulations on some member states. These problems have been exacerbated by the economic crisis of 2008 (not the fault of the EU), and as a result, public confidence in the Euro, and the EU as a whole has been badly shaken. Those who criticise the lack of democratic accountability in the management of the Euro have a case, but the Euro is not the EU.

Losing our influence

Since we voted to join the European Economic Community in 1975, the UK has always been one of the most influential members. Because it is the third largest country by population, very few significant decisions are taken without UK support, usually in alliance with Germany and France. On issues of particular sensitivity to the UK we have been given special treatment (exclusion from the Schengen Agreement on free movement, and from the Euro, and a large rebate on our notional subscriptions). British diplomats, lawyers and civil servants have a high reputation and significant roles in the workings of the EU. When the Lisbon Treaty established the role of High Representative on Foreign Affairs (to speak for the EU on international issues) the first appointee was a British Labour politician. It is ironic that it was a British lawyer who drafted Article 50 of the Lisbon Treaty, with the aim of appeasing the right wing of the British Conservative Party.

The suggestion that the UK has no influence over laws and regulations is a myth. Between 1999 and 2016, the EU passed 2592 laws. In the Council of Ministers, the UK voted in favour of 95% of these (2466). The level of disagreement is, of course, higher than this, since drafts are only presented to Parliament and the Council after lengthy diplomatic preliminary work, where some ideas are removed before even being published. UK Ministers have sometimes voted against the majority of elected UK MEPs.

The EU’s evolving mission

Meanwhile, the EU continues to evolve, and will go on doing so after/if the UK leaves.  The Union has agreed a set of ten future policy priorities:

  • Jobs, growth and investment
  • Digital single market
  • Energy union and climate
  • Internal market
  • Deeper and fairer economic and monetary union
  • A balanced and progressive trade policy to harness globalisation
  • Justice and fundamental rights
  • Migration
  • A stronger global actor
  • Democratic change

All of these issues matter to the UK, and to the electorate who voted in the referendum. If we stay within the EU, we would have the opportunity to influence the direction of these policies. Outside, we have no voice, but the EU will move on without us. For the last 43 years we have been “rule makers” in EU policy, and if we leave we will necessarily become “rule takers”, since our economy depends so heavily of the EU, There is no option to ignore the policies of the EU. We are 60 million, the 27 countries are 440 million. It is absurd to think that we will continue to have as much influence over the issues which matter most to us after Brexit as we have now.

In 2019 elections will be held for the European Parliament. If Brexit goes ahead, the UK’s parliamentary seats will be redistributed among the other member states, and we will lose our democratic voice.

The EU and the member states

The EU is a collaborative club of member states, who join for mutual benefit, and agree to contribute to the costs. The success of the common enterprise depends on everyone playing by the rules, but being prepared to tolerate compromises to meet the particular needs of individual states.

What is not negotiable is commitment to the “four freedoms” (freedom of movement of goods, services, money and people) which gives equal rights to all citizens, companies and organisations, and the jurisdiction of the European Court of Justice, which adjudicates in disputes.

If any member state refuses to abide by these rules, it acquires an unfair advantage over the other members, which is precisely what the Union was created to avoid. It is therefore essential to the survival of the entire enterprise that no country breaks these rules. The EU has no interest in “punishing” the UK if it leaves, but it cannot reasonably be expected to agree to the UK having an unfair advantage over its members. If everyone leaves the club and expects to keep the benefits, there is no longer a club!

What did people vote for?

The Brexit referendum offered a simple binary choice. Campaigners on both side offered visions of the consequences of leaving or remaining, but most of this was inevitably speculation, and much was exaggerated. In a real sense, no one could know what they were voting for.

Opinion polls since have tried to investigate what people thought they were voting for, and the picture is not at all clear. Some thought it was primarily about immigration, while others prioritised “control” (though whose control over what was much less clear). One significant poll shortly after the referendum illustrates the problem. When asked whether people would prioritise remaining in the Single Market over controlling immigration, the balance was 2:1 in favour of remaining in the Single Market: a policy which the Government has repeatedly rejected.

What outcomes are possible?

In principle there can only be four outcomes from the Brexit negotiations:

“No deal”

meets the requirement to honour the referendum result, but it is inconceivable, and no one seriously believes that it will happen. If all existing agreements and treaties lapsed on 29th March 2019, there would be no legal authority to adjudicate in disputes between the UK and the rest of the EU, and businesses would be unlikely to risk operating across the border. Air traffic would stop, existing EU contracts would be in limbo, imports of medical isotopes for cancer treatment would stop, and financial services based in the UK would no longer be able to do business in the rest of the EU. The Irish border would be closed, with a threat to political stability. The legal status and rights of UK citizens living in the EU, and EU citizens living in the UK would be unclear. World Trade Organisation tariffs would be introduced immediately on UK exports to the EU (and probably EU imports to the UK), causing major delays at ports, given the need for large numbers of additional customs checks. Import delays would provoke serious food shortages. If businesses believed that this was at all likely, the emergency plans required to protect their commercial interests might cause significant unemployment and social disruption.

Soft Brexit

can also meet the requirement to “leave”, though Brexit campaigners differ in what compromises they would accept. There are several variants of “soft Brexit” (including Norway, Canada, Switzerland), but all involve “cherry picking” which bits of EU rules and institutions we remain in, and what we pay for the privilege. All depend on the willingness of the other member states to agree, and all require us to renounce our seats on the Council, Parliament, Commission and Court of Justice, and to give up our votes on laws, regulations and the future direction of the Union. To continue to cooperate on issues like medicines, crime and air traffic we would need to create a large number of new institutions to parallel those which we are members of as members of the EU. We would need to create a new body to adjudicate in disputes, to replace the ECJ. Any realistic version of “soft Brexit” would thus be very expensive to implement and while it would satisfy the requirement to “leave”, it would not actually increase control over anything significant.

Stop Brexit

is still an option, but would clearly not honour the expectations of those who voted for Brexit. Up until 29th March 2019, the UK can withdraw its notice to leave, and return to its previous status. The UK would retain unrestricted access to the EU market, and benefit from the EU’s trade agreements with 70 odd other countries either agreed or in active negotiation. In return it must continue to contribute to the budget and subscribe to the four freedoms. Although Parliament has the constitutional right to decide to stop the Brexit process, it is unlikely to do so for fear of punishment by the electorate for abandoning the “will of the people”. It therefore requires either a substantial change in public opinion (which is not yet evident) or a new mandate (through a general election or a new referendum on the terms on offer).

Leave and return.

The UK might decide to leave the EU on one of the bases listed above, and then, after some years, change its mind. Opinion polling suggests that public opinion is quite likely to support this, since opposition to membership is far greater among older people. However, under EU law, the UK would have to apply like any new applicant state, and abide by the rules. This would probably require us to join Schengen and the Euro, and lose the current budget rebate. This would be a very expensive option.

The Labour Party’s policy

Finally, a comment on the parochial interests of the UK Labour Party. The last two years have shown the extraordinary irresponsibility of the British Conservative Party, prepared to put at risk the UK’s economy, social welfare and standing in the world (all issues they claim to care about), to deal with an internal party squabble. Once again, they have demonstrated that retaining control of government in the party interest outbids any national interest. Against this, the Labour Party needs to be a strong voice for what is best for the UK as a whole. This should be a principled position, not based on our chances of tipping out a weak and divided government, desirable as that is.

Respected legal opinion is that nothing in the 2017 Labour Manifesto is prohibited by EU laws. Where there is any doubt, our chances of changing things are greater as members than as outsiders. It is also clear that there are many things that some on the political right would like that are prevented by membership. Freedom from EU laws and regulations would enable a Conservative UK government to repeal legislation protecting workers’, citizens’, and consumers’ rights. It would also protect us from the EU’s plans to regulate tax havens. It is not a coincidence that the leave campaign was led and funded by some of the richest people in the country, and supported by print media owned by tax exiles.

Conclusion

The referendum was limited, but legitimate. Although only 37% of the electorate voted leave, people were told that that a simple majority of those voting would be sufficient result, and 52% of them chose leave. They were told conflicting things about whether the result would be binding on the government, and about what leaving might mean. Only when the current negotiations are complete will anyone know what the real choice is.
Parliament has the constitutional right to stop Brexit when it sees the result of the negotiation, but to do so would be politically dangerous, not only for parties and MPs but for social cohesion and the national interest. I therefore believe that Parliament requires a new mandate on the terms actually available. This could be achieved by:

  • a general election where the parties took distinct clear positions, for and against Brexit on the terms negotiated
  • a general election where one party at least campaigned for a referendum on the terms negotiated
  • a referendum on the terms negotiated, without a general election

Each of these has risks and advantages, but to allow this government, with no Parliamentary majority, to put the future of our security, economy and rights at risk to resolve internal party disputes would be the height of irresponsibility.

The clock is ticking. The terms must be clear by October to allow them to be ratified by the other member states. Any of these three options is likely to require some extension of the Article 50 period beyond March 2019, and the other member states might be sympathetic to agreeing this, since most of them would prefer us to remain members, However, this causes problems for the European Parliament elections due in May 2019. It is vital, in the national interest, that the Labour Party makes its position as clear as possible, as quickly as possible.

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