My Thoughts on Brexit

June 23, 2016 3:40 p.m.

Before the results are in, I just wanted to say a few words on Brexit, Britain’s proposed exit from the EU. This is an issue for the British. But it is an issue that I think everyone has some right to chime in on since it will have a real effect on the whole global economy, and real effects in the US since Britain and the EU are among the United States’ largest trading partners. In short, the idea strikes me as simply crazy.

Here’s why.

The UK is no longer a great power. It is at severe disadvantages not being part of one of the very small number of global trading blocs or free trade zones. (The US is the only country with a large enough economy to function in effect as one of the global free trade zones.) What’s more, Britain already partakes of a totally on its own terms, a la carte EU. It has already kept out of the Euro and Schengen Agreement (intra-EU open borders), which has become so controversial both in terms of immigration and counter-terrorism.

In other words, the big things that I could see the UK wanting out of it’s not even in.

Another potential argument is that this is something like US opposition to NAFTA, getting out of an agreement that is perceived (and to a real degree has) led to the export of many US jobs. Here you have all the strains of economic nationalism that are roiling the US and many advanced economies. But it’s not a proper analogy since all of the UK’s trade agreements are bound up through the EU. It wouldn’t even have a preferential trade treaty with the US if it left the EU. Exit supporters say new treaties would be written up soon enough. But that’s questionable. With the US, that’s likely true. But that kind of stuff doesn’t happen overnight. (President Obama made this point specifically in the UK a few weeks ago, though it’s fair to say he may have been exaggerating how long a new treaty might take to complete). With the EU, they’d be facing a very aggrieved counter-party. Again, seems like a crazy idea, even if there are downsides of being in the EU and thus competing against lower wage economies in other parts of Europe.

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The best thing I’ve read on the topic is a really wonderful short piece by Fintan O’Toole in The Irish Times. O’Toole’s argument is that Brexit is really no more and no less than English nationalism, but a national independence movement that the English are rather stumbling toward rather than thinking through in any coherent way. As he notes, a British exit from the EU would quite likely speed the path for a Scottish exit from the UK and create an increasingly awkward position for Northern Ireland. Even an eventual departure of Wales isn’t totally beyond question. To add to this irony, if Brexit is largely driven by older, economically left-behind working and middle class English (which polls suggest it is), an independent England would be a very, very tory state. So to whatever extent the EU is a neo-liberal hell, post-UK, post-EU England would be one in perpetuity. Only what used to be called the Celtic fringe keeps the UK somewhat anchored in social democracy.

There are various other reasons, Brexit strikes me as a very bad idea. Taken together though it seems like some sort of weird acid trip the British body politic is undergoing producing a flashback to earlier days as a great power. Of course, every time a country seems poised to do something that ‘seems crazy’ it’s important to understand what other factors, motivations, social stress might be leading to that step. That is a critical question and a complex one. For now, though, I wanted to focus on the substance of the matter. What I think will happen. On that front, it seems crazy. The EU has allowed Britain to pick and choose what it wants in the EU. They have the best of both worlds. We’ll see what happens.

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