The EU as Great Britain’s tailor

brexitTC

Great Britain’s exit from the European Union could be the straw that breaks Europe’s back. So heads of state and governments have worked hard on devising a new tailor-made suit for the UK. Everything already seemed to have been invented, so it was not easy to find a new formula for Britain to be excluded, yet at the same time remain within. Cameron himself found it difficult to come up with something new. That is why he has taken three years to explain what he wanted.

Being in without really being in

Britain will be explicitly excluded from “an ever closer union,” the idea envisaged in the preamble of the treaty. This means that a national parliament can block common legislative projects and restrict social benefits for workers from the rest of the EU in its territory. It will also be able to block, for a reasonable amount of  time, decisions of a Eurozone of which it is not part. The very idea that the UK may cause problems for the Eurozone while not even being part of it has seemed an anathema for the members of the single currency. It is obvious that Britain has been a big headache for the rest since its accession: a dog in a manger.

But there is a danger here which is beyond their control, and they know it. If any of the British exceptions collide with some Treaty, there is no way of preventing someone from raising an action in the EU Court of Justice which would rule as a last resort. And that possibility is scary. So, without further explanation, the President of the Council, Donald Tusk, immediately announced in the European Parliament that “the new agreement is in accordance with the treaties and cannot be changed by the European Court of Justice.” But the truth is that the judges will have the last word.

Not negotiating these exceptions with Cameron would have been like showing the British the door. But Brexit can happen anyway. In the end it’s not Cameron but the UK voters who have the last word.

If Britain leaves us, what is the risk for the EU? What frightens people most on this side of the channel is the setting of a precedent. What will prevent Poland or Hungary from organizing their own referendum, especially if the Union keeps bothering these countries, requiring respect for the rule of law in Warsaw or Budapest? The Lisbon Treaty, signed in 2007, first introduced a procedure for leaving the Union. And the British are no longer the only euroskeptics in these times. In fact, the UK ranks only eleventh in the latest Eurobarometer survey published in late February, with 44% of “pessimists” about the future of the EU. It is surpassed by countries like France (52%) or even Germany (48%).

Others argue that Brexit would also be a setback for the EU politically, given the UK’s global strategic importance. But European foreign policy does not yet have a single true voice and London often causes conflict. Regarding Britain’s military potential, they are the ones who are most against a European defence. And the loss of its nuclear umbrella is not a determining factor. This is provided by NATO where, in addition, the important thing is the American deterrence force. That will not change.

Economically, of course, EU GDP would be reduced and the prospect of Brexit scares the markets. That is why they have yielded so much to London demands.

If Cameron now loses the referendum, it would mean his political demise, the breakup of his party and maybe of his country, given Scotland’s Europeanism. The Bank of England has estimated the net economic benefit of UK membership of the EU at between -5% and 20% of GDP.

Britain would have to re-establish customs controls at its borders with the EU, a tariff would be imposed on their exports and access to the City of London would be restricted.

To minimize the consequences of Brexit, they would try to find some kind of arrangement like partnership agreements. These would enable them to continue working as closely as possible on issues of internal market and financial regulation, with the aim of maintaining the status quo so that the City can return to a win-win situation.

Ironically, in order to have access to the domestic market, Britain would have to accept common rules like the free movement of workers, as well as contribute to the budget. At least that is what one of the fathers of the Lisbon Treaty, Jean-Claude Piris, says in a study recently published by the think tank Centre for European Reform. Besides paying and accepting what it previously rejected, he says Britain would be without any decision-making power as it would have no representatives in the EU council of ministers or in the European Parliament.

But this can be achieved in various ways, always with a similar result. The fastest one would be for Britain to join Norway, Iceland and Liechtenstein in the European Economic Area, created in 1994. This would allow the British to be consistent with their traditional idea of what the EU should be: a single market without other common policies such as agriculture, fisheries, foreign, interior or justice. But surely the UK would not be in favour of this solution, given the limited influence it would have with this status in the creation of the single market? It would immediately realise that its economic importance is not comparable to that of the other countries mentioned. So it would want to negotiate a new tailor-made suit.

About the Author

Jacobo de Regoyos
Jacobo de Regoyos has been reporting from Brussels for the last 16 years. After writing for Spanish newspaper El Mundo and Tele 5, he is currently the correspondent for Onda Cero Radio. He holds a degree in Journalism by San Pablo CEU University and in 2001 he won the prestigious Salvador de Madariaga award, granted to the best reporting in Europe. He is also author of 'Belgistán, el laboratorio nacionalista' (Belgistan, the nationalism lab), about the evolution of nationalism in the EU.