12 October 2016

Can the EU survive Brexit?


UK politicians may have spent the last three months debating the finer points of what post-Brexit Britain will look like: Hard Brexit or soft Brexit? Norway-extra or Switzerland-light? Yet little attention has been spent looking at the other side of the equation. What will be the impact of Brexit not in Britain, but in Brussels?

Many assume that the European Union will carry on much as before, albeit a little smaller. But those who campaigned for Brexit argue that we are underestimating its wider impact on Europe – and, in turn, what that means for Britain’s own future. Brexit, after all, is just one of a number of crises facing the EU. And under such circumstances, our exit risks being perceived as a direct attack on an already embattled Brussels.

According to Frank Field, Labour MP and prominent Leave supporter, for the negotiation to be a success, Britain has to both minimise the damage it does upon exit, and convince the EU that it it does not want to cause it harm. “While of course we want to get the best possible terms for this country, we have to keep in mind what we are doing is going to have big consequences in the EU,” he says.

Field is puzzled by Theresa May’s timing for Article 50, before the French and German elections, making Brexit, “a bigger issue in their campaigns. I think we should leave it until later in the year, or even to the following year.” Such a delay would make it easier for Angela Merkel to win re-election, “very much in our interest”, Field points out. Better to have Europe led by a strong, businesslike figure than to have to deal with a divided and defensive continent.

However, others believe that tinkering with the exact date of Brexit will have little effect on the other systemic issues that the EU will now have to face. John Mills, chairman of the Labour Leave campaign, argues that the growing disparities between European haves and have nots would have come to a head sooner rather than later in any event.

“I think you are likely to see more and more protest movements and anti-austerity,” he says. “Part of the problem is that a third of the population in the EU are actually doing very well. Globalisation, internationalism, trade, it really suits them. You then have another section of the population…who have seen blue collar jobs disappearing, who are left in very insecure positions, compounded in Europe by very high unemployment.”

Sooner or later, he argues, this national disparity will have to be addressed, or Europe will start to seize up. “It seems to me that this is a pretty dangerous political cocktail. You are moving to a position where a majority of people think they are really not doing well. Eight years down the track, people don’t feel the establishment parties have dealt with the aftermath of the financial crisis. They may start to look for alternatives. This engine of political instability could be the undoing of the EU if it’s not very careful.”

Yet many of those who campaigned for a Leave vote from the Tory side are even less optimistic about what comes next for Brussels. “It’s doomed,” says Sir Bill Cash MP, chair of the European Scrutiny Committee and chief Maastricht rebel under John Major. “The monetary union system is full of internal contradictions and it can’t work. There’s no such thing as a one size fits all policy.”

Such contradictions are not something for Europe to work out in future, Cash argues, they are already beginning to come to a head. “You only need to look at the rows between [Italian prime minister] Renzi, [German finance minister] Schauble and Merkel to realise how serious this is. Schauble and Merkel will not allow any wiggle room on the stability and growth pact. And yet back in 2004, Germany completely ignored the rules and nobody said boo to a goose. On any issue of any substance, Germany calls the shots.”

Just going along with the German consensus within the EU will soon cease to be attractive, he claims, especially if it is Germany that benefits most. “Other states may decide sooner or later they want to get out as well. I don’t think they will accept effective control.” Indeed, he argues, such tension is becoming more evident behind the scenes.

“I attend meetings of COSAC,” he explains, “the assembly of European affairs committees of national parliaments, about once a month. At the last meeting, about two weeks ago, there was an enormous row between the French and the Eastern European countries, and some of the Mediterranean countries, to the point at which they were clamouring around the platform besieging the Slovakian presidency chairman, and literally it was a shouting match. That was all about the refugee crisis.”

That Germany has torn up the regulations to admit young Syrians, to the despair of other European nations and many within Germany itself, is yet another example of the costs of integration, felt unevenly throughout the union. Such a problem, says Sir William, cannot be solved without treaty change, “and that won’t happen because of the need for consensus to change a single word of any treaty”.

In other words, he reckons Britain has got out just in time. Collapse, he says, “is nearer than people think. The Greeks are a basket case, the Italians are in dire straits, the French economy is also in tatters, and Germany faces massive internal pressure from the AfD.”

Other Brexiteers, however, are not quite so pessimistic. “I don’t think Europe has worked out what it wants to do,” says Jacob Rees-Mogg MP, Conservative backbencher and Leave campaigner. “It hasn’t worked out whether Brexit marks a British problem, or a broader European problem.”

Rees-Mogg believes that the EU is still salvageable, if not in its current form: “I think there is a model of the EU that could work for existing member states, and that goes with the grain of what electorates want. And that is inevitably a looser model.”  The problem comes with European leaders’ plans for ever closer union. “If integration accelerates, the EU fails and it breaks up. Eventually electorates will get fed up and get their own referendums. But that could be 30 years away.”

So what of Brexit? “If Europe gets this right, there is the chance to have a very successful Europe,” Rees-Mogg argues. “If they look at the British and instead of saying, ‘they are just a bit funny’, and actually they say there are real problems with the model we have and we’ve got to change it, which is exactly what the Eastern European bloc are saying. If they take that path, they might be able to create a Europe which could be acceptable to its electorates and might work.”

For all the smirks and I told you so’s that would be exchanged on this side of the Channel, a failed EU would only hurt the UK. Even having voted Out, it seems Britain may still end up having to fight for a pragmatic European Union.

George Greenwood is a freelance political journalist.