This blog has from time to time brought out flaws in critiques of the UK leaving the EU. Don’t conclude from this that Brexit is risk free. Far from it. It is a fundamental decision with profound consequences – but not the ones getting most the headlines.
Start with the remarkable success story that is the EU. We take it for granted. Yet in a world which has witnessed the disintegration of the USSR, Yugoslavia and various African and Middle Eastern sovereignties, welding two dozen European countries into an effective political union is perhaps the most significant political event of the last forty years, ranking alongside the rise of China or the decline of the Soviet Union.
The scale of achievement is enormous: the transfer of much economic sovereignty and a good deal of social direction to supra-national organs; substantial integration of economic life and increasingly populations; a common currency, with a high level of convergence of budget and public expenditure approaches; and more harmonised and European-focused judicial institutions.
The process of ever closer union has now reached a point where it can be plausibly argued that institutionally most of the initiative comes at the federal (ie, supranational) level and the majority of power is exercised there. The institutions in question are a standing European bureaucracy (the European Commission), a Europe-wide legislature (the European Parliament) and a coalition of national governments, led by the German and French governments (of whichever political stripe), which think primarily in European terms. National governments are left on their own to deal with town planning, plumbing and drains on a larger scale, and resolving the distributional and social squabbles of a mature democracy. Their formal retention of foreign and defence policy is in practical terms something of a nullity as any major action requires a common front. True, they still retain a wide power of non-participation (although the drawn out Brexit saga shows the difficulties in deciding not to participate on the majority’s terms).
It would take a lot more than a thousand words to explain all this, but some reasons stand out.
First, that those seeking union had a clear vision and extraordinary consistency of purpose. Every opportunity to build permanent institutions that will promote convergence has been taken. They have also been tactically flexible, absorbing or defeating alternative visions.
Secondly, that union has been taking place at the practical level, by solving practical problems, sometimes those that national governments could not solve on their own. Providing essential services, like supporting the independence of Eastern Europe and avoiding predatory capitalism after its liberation from Soviet tutelage.
Thirdly, it has been consensual. Sufficient government support has always been marshalled, public resistance has been sufficiently allayed or at times, acknowledged for the time being. Progress has gone in fits and starts but has been maintained.
Fourthly, it has had a strong institutionally market liberal element – as demonstrated by the single market and customs union, which have opened markets (up to a point) and facilitated economic growth (also up to a point) – while at the same time acknowledging extensive social welfare commitments and asserting far-reaching regulatory competence over markets and innovation for state institutions.
None of this might have been enough without great leadership, by the German political class, supported by the French. The German ability to subsume their potential dominance inside a European framework, to rigorously seek consensus to the point where a model on German lines is predominant, is surely remarkable, and the more understandable in the light of history.
Which makes the cases of the three members of the European awkward squad an aid to understanding.
Switzerland is a country that would appear to be more European than most of Europe and is both economically and socially integrated with and heavily dependent on Europe. Yet, its national self-confidence is so pervasive and distinctive that it resists political integration and goes to great length and cost to assert aspects of independence. One cannot be sure if its quirkiness is simply the exception that proves the rule, or a sign of the ultimate limit to supra-national integration.
Turkey hitched its wagon to the European train at an early stage but it remains on the outside. The European leadership has taken the brutally pragmatic view that some countries and peoples are harder to integrate than others. In turn, the Turks have elected a government which equally brutally seeks to assert Turkish influence in the middle east in a not-very-EU way.
And Britain which throughout its 46 years of membership has sought the economic and political benefits of membership whilst lacking sufficient commitment to the goal of union, among the political class and certainly among the people (itself an expression of a certain kind of national self-confidence). Seen through this lens, the British vision for Europe (necessary to secure an internal British consensus for membership) was always a mirage – British diplomats sought to woo Germany to their model of a looser economic federation but failed because the Germans always had a different long-term objective. Instead, Britain provided a useful foil to play off France when it got out of line.
Brexit poses the most serious test of the European project so far, because it challenges directly the notion that closer union is a no-brainer – both sensible and inevitable. After the success of integration, it puts forward the test of how well a single independent state (assuming the UK hangs together) is going to function on the periphery.
At a technical level, there is an important question as to whether the sort of economic and regulatory decisions taken by the EU are better taken at the national or the supra-national level. Your answer to that is likely to be influenced by your prejudices.
Then there is the question of whether the UK or the EU will respond better to the rupture. The EU’s history suggests that it is likely to behave defensively, what this blog termed a strategy of pragmatic isolation. In the long run, this will have economic costs. The UK’s incentives are to respond by greater economic openness to the wider world. In the long run, this should have economic benefits. Your answer to this question is likely to be influenced by your hopes.
But Brexit will require the EU to come up with new arguments if it is to continue with the vision of ever closer union we discussed earlier this year. Because the union has succeeded by consensus and the prospect of rebuilding consensus through punishment does not seem like a plausible strategy.