Brexit from EU may really happen

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Brexit from EU may really happen

Visiting the U.K. over the past week, I realized for the first time that Britain might actually leave the European Union. Of course, it has talked about this eventuality, on and off, almost since it joined - but for years the constant whining could be dismissed as so much background noise. Things have changed. Attitudes are hardening, and by promising an “in or out” referendum on EU membership after the next election, Prime Minister David Cameron may have put the country on a course that will force it to choose.

If the referendum Cameron promises for 2017 were put to voters tomorrow, the U.K. would probably leave. According to polling by the Pew Global Attitudes Project, only 26 percent of Britons think Europe’s economic integration has helped the economy, and only 43 percent have a favorable opinion of the EU. Other recent polls show steady (though mostly slender) majorities in favor of exit.

Cameron will have to win another election to keep his referendum promise. His government is unpopular so that’s no sure thing. But the opposition Labour Party will probably have to promise a referendum, too, once the 2015 election comes into view - especially if the U.K. Independence Party, which is committed to an exit, keeps gathering strength. (UKIP already attracts more support than the pro-European Liberal Democrats.) It’s hard to run on a platform of denying voters a choice.

Cameron isn’t a Euro-skeptic: He’s the pro-EU leader of a party that’s long been bitterly divided on the issue. To hold the Conservatives together and keep the country in the EU, he wants to draft a new European treaty more to Britain’s liking before a referendum occurs. The other EU leaders say they want nothing to do with this.

It’s a point that British advocates of exit have seized on. In an article in the Times last week, Nigel Lawson, a former Tory chancellor of the exchequer (and no knee-jerk Little Englander), said he expected nothing from the renegotiation and would be voting for exit. Several other former ministers have said the same.

Here’s the surprise: These interventions weren’t greeted as reckless or sensational, as they once would have been. Suddenly, exit is on the political agenda. Much of the City has turned Euro-skeptic as a reaction to what many see as a vindictive regulatory assault from Brussels. U.K. businesses used to be strongly pro-EU, but that’s no longer so. What once might have seemed an idle or even absurd threat has become a real possibility.

I think the question of whether the U.K. should remain part of the EU (EUGNEMUQ) is a closer call than either side wants to admit - and, just as Cameron says, it all depends on the terms. If the EU responds to the economic crisis with new strides toward a United States of Europe, the costs for the U.K. will surely outweigh the benefits: Britain just doesn’t want to be part of that enterprise. If EU membership will require eventual membership of the euro area - and that’s the prevailing model, as though the crisis had never happened - Britain should again say no thanks.

As free trade becomes the global norm, the benefits of open access to Europe’s markets are less and less confined to EU members. Cameron, visiting President Barack Obama in Washington this week, discussed the proposed U.S.-EU trade pact, among other things. The U.S. has signed free-trade agreements that span the globe. The U.K. could do the same.

At the very least, Britain’s pro-EU forces need better arguments. They say Cameron shouldn’t have raised the issue in the first place, implying it’s better to deny voters a say. What are voters to make of that? Pro-EU politicians keep repeating that exit is unthinkable - but never really say why. What makes Switzerland’s relationship with the EU unthinkable? They think Britain should be leading Europe, that it maximizes its global influence that way. Well, that’s just delusional. Why should Britain expect to lead a union of 27, soon to be 28, countries?

Let’s take Canada as a thought experiment. It’s a small economy next to a big economy. Its global influence is limited by its size, of course. Would it be better off as part of the U.S.? Would its influence in the world be greater? And wouldn’t Canadians be giving up something they value very highly? The pro-EU cause should find some answers to these questions.

For Europe’s sake, as much as it pains them, the other EU governments should acknowledge that Cameron is right about the need for a new constitutional settlement. The Pew survey shows that disaffection with the EU is by no means confined to the U.K. Grievances aren’t concentrated in the south, either. Support for the union in France - co-architect of the whole project - is actually lower than in Britain.

Can it seriously be maintained that Europe’s economic calamity raises no questions about the EU’s constitutional direction, that the commitment to “ever closer union” enshrined in the founding documents can’t ever be reviewed, and that the euro system, despite its recent difficulties, is fundamentally sound? That’s what the EU’s leaders are asking an increasingly dismayed European electorate to believe.

Cameron’s critics say he’s the trouble maker. I don’t think so. The real threat to the EU is the other leaders’ bizarre refusal to acknowledge what’s happening.

*The author is a Bloomberg View columnist.

by Clive Crook
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