No other ancient artifact has been the subject of more intense, decades-long international debate than the Elgin Marbles. Since the 1980s the Greek government has in a spirit of nationalism argued for the repatriation of these classical masterpieces from the British Museum in London. But an old debate now gains a new dimension: Brexit.

The marbles, built for the Athenian Parthenon in 5th century BCE, have resided in the British Museum since the early 19th century, when Ottoman authorities granted permission to Lord Elgin for the removal of about half of the surviving marbles. That portion is currently in the ownership of the Trustees of the British Museum. Much of the debate on their repatriation has remained unchanged since the 80s. The Greeks argue that the marbles, as relics of their national cultural heritage, rightfully belong to them. The British Museum, on the other hand, contends that the marbles transcend national boundaries as part of a global cultural heritage.

Certain activists and Greek politicians have recently come to see the UK’s Brexit vote as an opportunity to shake up this debate. Since all 27 remaining states in the European Union can veto the exit deal, Greece could attempt to muscle into the final accord the repatriation of the Elgin Marbles. By refusing to comply with the political and economic terms of the agreement until the United Kingdom should agree to the repatriation, Greece could hold the U.K hostage for the marbles.

Though the general issue of the Elgin marbles is multidimensional, the employment of Brexit in it is misguided. This strategy wrongly conflates the political with the cultural; it hinges the consequences of a democratic political decision on a dispute over art, and it holds the British people responsible for a question that they never voted to answer.

Geoffrey Robertson, a proponent of a Brexit deal with the Elgin marbles, writes in the Guardian that articles 3 and 167 of the Treaty of the European Union legitimize the use of the marbles in the negotiation; article 3 “ensures that Europe’s cultural heritage is safeguarded and enhanced.” Stelios Koulogou, a member of the European Parliament and an investigative journalist, furthers this argument by the assertion that, “The Parthenon Marbles are considered as the greatest symbol of European culture. Therefore, reuniting the marbles would be both a sign of respect and civilized relationship between Great Britain and the EU, and much more [than] a legal necessity.”

Though the general issue of the Elgin marbles is multidimensional, the employment of Brexit in it is misguided. This strategy wrongly conflates the political with the cultural; it hinges the consequences of a democratic political decision on a dispute over art, and it holds the British people responsible for a question that they never voted to answer.

The problem is that the legal arguments for the return of the Elgin marbles are void. For years they hinged on some alleged historical uncertainty in Lord Elgin’s purchase from the Ottoman authorities. Many, however, including the British government, hold that the marbles were acquired in accordance with the law of the time. But the legality of the purchase, whatever it was, is anyway now irrelevant. In 2016 non-governmental campaigners brought the first ever legal suit on the issue to the European Court of Human Rights. The court dismissed it on the basis that the acquisition happened “too long ago,” well before any human rights agreement. The Greek Government itself, moreover, in 2015 ceased its attempt at a legal claim to the sculptures, and has officially committed to handle the issue by diplomacy alone.

The point is that there is no legal claim to the marbles; all arguments must therefore be cultural rather than legal. Yet the invocation of the articles of the Treaty of the European Union is a legal argument, for it employs law to justify the return of the marbles. Even the European Commission itself does not interpret those articles as pertaining to the controversy over the Elgin marble.

The British people, furthermore, in voting for Brexit, voted on their own political and economic future. They did not vote to sever all ties to the cultural heritage of the West. The UK’s decision to leave the European Union does not in any way imply that it wants nothing to do with art that originated in Europe. But if the advocates like Koulogou had their way, this cultural dispute, which was entirely irrelevant to the democratic decision of the people at the time of the referendum, would exert undue influence on their political and economic future. Dame Janet Suzman, chairwoman of the British Committee for the Reunification of the Parthenon Marbles, aptly put it: “great art was as far from the question posed to the people as anything I can think of. This is entirely another question, a question of aesthetics, honesty, and colonial morality. It would be like putting apples and pears together.”

To leverage so consequential a democratic decision as Brexit, simply to acquire the upper hand in an ongoing dispute over art, borders on unethical. Issues of cultural heritage are important, and are often political. We must nonetheless be careful to distinguish where cultural disputes are politically relevant and ethically justified, and where they are not.

 

Photo

When former British Prime Minister David Cameron urged his countrymen not to vote to leave the EU and raised the specter of war in a divided Europe, he was on to something. However, it is not disunity on the continent he should have been worrying about, but rather the disunity in Northern Ireland, where Brexit has the potential to reopen the wounds of a murderous conflict.

Cameron’s warnings against Brexit went unheeded, and the Leave camp, which promised voters that exiting the EU would win back national sovereignty and control over immigration, emerged victorious in the June 2016 referendum. Cameron’s successor, Theresa May, has been left with the bureaucratic challenge of extricating her country from the EU’s dense and decades-old network of political, legal, and regulatory ties without causing a major shock to the UK’s economy. Her government has about 18 months to craft a deal with EU leaders in Brussels on the terms of Brexit before it takes effect in March 2019.

One of the sites of this challenge is the all-but-invisible border between Northern Ireland, a part of the UK, and the Republic of Ireland, a sovereign state. The return of a conventional border between the two sides—previously obsolete as both were part of the EU—could spell trouble in a region shaped by simmering questions of national identity and belonging. While Brexit is unlikely to bring violent conflict back to the island, British and European leaders must be careful not to imperil the progress made in recent decades towards overcoming the conflict.

For much of the late 20th century, Northern Ireland was one of the bloodiest, most conflict-ridden places in Europe. From the late 1960s to the late 1990s, a long-standing conflict over land and national identity pitted Protestant Unionists, who wished to remain a part of the UK against Catholic Irish Republicans, who sought independence from the UK and freedom from discriminatory British policies through unification with the Republic of Ireland. During the period known as the Troubles, violence perpetrated by paramilitary organizations such as the nationalist Provisional Irish Republican Army (IRA) and the loyalist Ulster Defense Association (UDA), as well as by British security forces, claimed the lives of over 3,600 people, almost two-thirds of whom were civilians. A hard-won peace was reached in the 1998 Good Friday Agreement, which stipulated that Northern Ireland would remain part of the UK unless a majority of its residents supported a change of status. At the same time, the agreement increased Northern Ireland’s regional autonomy and instituted power-sharing mechanisms between unionist and nationalist camps in the regional government. Residents of Northern Ireland were given the right to hold either Irish or British citizenship, or both.

The agreement is widely credited with restoring normalcy to the region. Despite sporadic riots and clashes, particularly during regular public marches, the three-figure annual death tolls, militarized English “anti-insurgent” border control units, and bombings have ended.

This is not to say that coexistence is entirely without friction. In the Northern Irish cities of Belfast and Derry (officially Londonderry), murals commemorating the Troubles—some celebrating paramilitary violence—pockmark the city landscape as solemn reminders of the violent past. In Belfast, so-called “peace walls” continue to separate Catholic and Protestant neighborhoods, although the city is attempting to remove them.

Public opinion remains divided, too. In 2015, 27 percent of Catholics hoped to see a united Ireland in the short term, while only 3 percent of Protestants felt the same way, according to a BBC poll. While a majority of Northern Irish voted against Brexit during the 2016 referendum, views diverged on this topic, too, with 80 percent of Catholics voting to remain and only 40 percent of Protestants doing the same. Brexit will also have a direct financial effect on the ongoing peace process. It is uncertain whether the EU, which has spent around 1.5 billion euros ($1.8 billion) since the Good Friday Agreement to solidify peace in the region, will continue this support, with no guarantees that Britain will pick up the tab.

Meanwhile, in the regional government, power-sharing has remained a strenuous affair. Northern Ireland has had no functioning executive since a coalition government between the nationalist Sinn Fein and the unionist Democratic Unionist Party (DUP) collapsed in January. The ensuing deadlock has led the British government to warn Northern Ireland that it might impose a temporary return to so-called direct rule from London. Sinn Fein has blamed the gridlock on disagreements over the legacy of the Troubles and DUP opposition to an Irish Language Act, according to the Guardian. The prospect of Brexit has added to the turmoil: Sinn Fein considers Brexit an opportunity to use voters’ concerns about leaving the EU to strengthen support for reunification with the Republic of Ireland, which remains a part of the EU. The party reiterated its call for a referendum on the matter in early 2017.

Against this background of stable but tenuous peace, many observers are worried about what a change in the status of the Ireland-Northern Ireland border would mean for stability and reconciliation in the region.  

The experience of harassment at the checkpoints left its mark on locals, highlighting the North’s separation from the Republic of Ireland and exacerbating perceptions of foreign rule.

For much of the Troubles, the border was marked by British military checkpoints manned by soldiers. “My father…experienced the process as a challenge to his sense of identity. There he was, half an hour from home, having to explain himself to an Englishman with a gun,” Irish author Garrett Carr wrote in the New York Times, describing cross-border trips from his childhood.

Since the end of violent strife, the situation has changed radically. Today, the border between the Republic and Northern Ireland is virtually invisible. There are no checkpoints and no guards, and travelers often have a hard time telling whether or not they have already crossed the border. In some places, the only observable change is the unit of measure on road markers and speed signs, which switches from kilometers in Ireland to miles in Northern Ireland. As a result, the 30,000 people who are estimated to cross the border for work each day barely notice that they are crossing an international boundary.

Today’s open border is seen as one of the central achievements of the peace process, but it has also been made possible by the interaction of several regulatory regimes. For one, the so-called Common Travel Area between the UK and Ireland has made travel for Irish and British citizens less burdensome. More important still are the European Union’s twin mechanisms of the single market and the customs union. The former allows for the free cross-border movement of goods and people. The latter allows EU members to eliminate tariffs inside the EU and apply standardized tariffs on economies outside the bloc.

However, as negotiators meet in Brussels to debate the terms of Brexit, the Irish border poses a unique conundrum. With the UK’s exit from the EU, the border will still lie within the Common Travel Area. However, it will also form the boundary of the European Union and its single market and customs union, with the Republic of Ireland inside the bloc and Northern Ireland outside. This could mean the return to a ‘hard border,’ where passports are checked and goods crossing from the UK into Ireland are subject to customs checks and tariffs.

A hard border would make travel more onerous and disrupt trade worth 3 billion Euros

A hard border would make travel more onerous and disrupt trade worth 3 billion Euros ($3.5 billion)—bad news especially for farmers, who export and import everything from dairy to pigs across the border.

Beyond this significant economic impact, the return of a hard border would likely make tempers flare among those who perceive the presence of any border as an injustice, serving as a constant physical reminder of partition. “What I want to hear is that there’ll be no return to any border, not even psychologically, because there’s no such thing as a soft border” one Northern Irish borderlander told the New York Times, showing that any type of border raises questions about national identity that many in the area do not want to revisit. Accordingly, opposition to Brexit was particularly strong among those living close to the border.

British Prime Minister Theresa May seems to understand this, vowing to ensure a “seamless and frictionless” border. A formal statement published by the UK government in August rejected the idea of “any physical border infrastructure,” such as cameras and checkpoints. But maintaining such a soft border brings its own troubles: Absent immigration control at the Ireland-Northern Ireland border, the UK government won’t be able to make good on its promise to use Brexit to regain full control over who enters the country—a major rallying cry for the pro-Brexit camp during last year’s campaign.

An alternative to passport checks along the Ireland-Northern Ireland border is to introduce stricter control elsewhere, such as between the Irish isle and Great Britain. However, such a proposal is likely to be rejected by the DUP, who would view the arrangement as discriminatory against Northern Ireland’s citizens, and who holds leverage in the negotiations as a supporter of Theresa May’s minority government in the British parliament.

The cross-border movement of goods presents another thorny issue. Brexiteers cherished the fact that exiting the EU would transfer authority over international trade back to London, promising that any economic losses associated with leaving the bloc would be compensated by more favorable trade deals with outside countries. Moving away from the trade standards of the EU’s single market and customs union, however, would entail some form of customs controls at any UK-EU border. The UK could likely maintain a soft border by adopting standards and tariffs that either closely or exactly mirror those defined by the EU’s single market and customs union. Yet such a move would undermine the point of Brexit in the first place, since it would strip the UK of much of the sovereignty over trade decisions so important to the Leave campaign.

London has suggested solving this dilemma through the innovative but logistically taxing approach of tracking and tracing goods. Under this model, the UK would keep tabs on all incoming products, applying different tariffs based on whether goods are destined for consumption in the UK or for further travel to the EU. The upside of the approach would be to avoid any customs border whatsoever between the UK and the EU—including between Northern Ireland and the Republic of Ireland. However, the model has not been tested, and some observers are skeptical about the feasibility of enforcement.

It remains to be seen if London’s proposals are actionable, and it is hard to predict what border arrangement, if any, will come out of its tug of war with Brussels by the end of negotiations in 2019. But there will come a point when Theresa May and her government must make some hard choices. They should acknowledge that making good on the promises of Brexit and maximizing the UK‘s independence from the EU, including on trade, must not be done at the expense of stability in Northern Ireland. The peace of the Northern Irish border today is a central achievement in the region. Any ill-considered border arrangement risks undermining those achievements by bringing questions of identity back to the forefront with renewed urgency. As former US Senator and Northern Ireland peace mediator George Mitchell put it, “demonization has declined as people move freely across the borders and get to realize they have more in common than that which divides them.” Negotiators in London and Brussels must work to protect this legacy.

Once again, Greece is making headlines for its economic troubles as it heads towards a major confrontation with its European creditors and the IMF. Tensions over bailout negotiations are on the rise and many are worried Athens will see itself in irremediable debt in the near future, considering the IMF is not participating in the latest bailout program. While the €110 billion financing plan with the IMF – the largest aid program in history – should have helped Athens regain its footing, Greece is still dependent on its €86 billion emergency loan package and has started its third Eurozone bailout program. Amid the uncertainty of its economic troubles, Greece has to honor a €7.4 billion debt repayment by July to the European Central Bank or will risk losing the aid packages that are keeping the government from the brink of collapse. With elections looming and public discontent growing, Greece needs to focus on long-term reforms that will create investor credibility and confidence for IMF funds in the future.

The need for change is more pressing than ever. The arrangement of this third bailout represents a change in policy for the IMF that could be a sign of troubling times ahead. The major difference between the third bailout program and the previous two is that, this time around, the IMF is not directly participating. Unless Greece accompanies the bailout with a verifiable strategy of debt relief and sustainability, the IMF will limit its role to that of an adviser and monitor of Greek economic performance. The lack of IMF presence poses an issue not only for Greece, but also for European creditors. The IMF’s expertise lends more credibility to bailouts, signaling to investors that payments are more likely to be met. This aura of legitimacy has played a paramount role in the success of bailouts in other Eurozone countries such as Portugal and Ireland. Moreover, Netherlands and Germany will only give Greece more loans if the IMF joins the aid program. Greece faces the risk of once again defaulting on its debt repayment in July. Yet as months have gone by and the IMF continues maintaining its observational role, it seems unlikely it will enter the bailout program now.

Given this worrying shift in IMF policy, the Greek government can no longer continue living in denial about its financial crisis. Yet this realization has not dawned on many Greek leaders. Eight years after the first inkling of a crisis in Greece, Greek politicians are still trying to find convenient scapegoats. For instance, they have repeatedly tried to imprison Andreas Georgiou, a statistician who worked in the IMF and the former chief of Greece’s statistical agency, for allegedly inflating the budget deficit and debt figures from 2009. Eurostat has validated his figures, and Georgiou has been acquitted in four trials since his initial arrest in 2011; however, Greek politicians have somehow failed to accept their own responsibility and have instead pushed his case to the Supreme Court.

Georgiou’s prosecution has sent a dangerous warning to government statisticians, disincentivizing them from publishing any news about the economy that can be interpreted as ‘undermining the national interest.’ This is concerning given Greece’s history of subtly falsifying economic statistics, like in 1999 when they became eligible to enter the Eurozone only by manipulating their budget deficit for that year. Georgiou himself faced strong opposition and union strikes when he adopted Eurostat statistical standards as the former President of Hellenic Statistical Authority (ELSTAT), an independent statistical agency formed as a condition of an earlier bailout. Although Greece as an EU member state is required to follow Eurostat guidelines, many politicians pushed to maintain the inaccurate 2009 budget figure. The skewed figure was even used in calculation of Greece’s €86 billion bailout. By curtailing the circulation of reliable information and discouraging statisticians and economists from proposing lasting solutions, Greece has forced itself into a dark future where economic growth is even more unreachable.

There are also more structural factors at play in Greece’s continuing crisis. Prime Minister Alexis Tsipras has yet to make good on his promise to “radically reform” the public sector and limit tax evasion. Although his election campaign championed Greece’s self-sufficiency, in previous bailouts he has tried and failed to loosen the creditors’ preconditions for the bailout. He has landed Greece in a crisis of circular reasoning – he requires the implementation of the bailout program to restore economic stability and stabilize debt relief, but the bailout program will only be successful with the participation of the IMF, which is unwilling to participate unless Greece implements a credible system of sustainable debt relief programs. In order to satisfy the austerity preconditions for the bailout, Tsipras has tried to raise taxes, a move that has been unpopular, instead of cutting government expenditures. Afraid of losing any more political power, Tsipras is hesitant to enact unpopular reforms. This creates an environment for political instability and dissolves any prospect of implementing long-term reforms to the judicial system and administration, limiting the government to a mainly economic role. 

This crisis has pointed out the potential difficulties of maintaining power as a populist party. In 2015, Greece was the first EU country to vote a populist party into power, its populace having become infuriated with the establishment parties in recent years. While Tsipras once had an 80 percent approval rating, he faces an inevitable conflict when presented with the reality of leading a country – balancing public support and implementing beneficial but unpopular policies. When he failed to deliver on his promises, his popularity plummeted. As the success of a populist party is dependent on its public support, his government has steered clear of unpopular policies. However, this reluctance to enact strong economic reforms is untenable in a country that is faced with a seemingly permanent financial crisis. Although Greece’s economic growth is projected at 2.7 percent this year, it has continued to lose economic value since 2009, and investment is expected to drop below 10 percent of its GDP.

An unlikely saving grace comes in the form of possible ‘snap elections‘ this year, if the present parliament cannot hold its own. Until now, the government has maintained a slim margin of three seats over its opposition. However, because of the persistent economic instability and increasing domestic disappointment with austerity, the center-right New Democracy party is gaining popularity as opposition. While a new government could introduce political instability, it appears the New Democracy favors strong structural labor reforms and reduction of government expenditure on public administration to attract foreign investment. It is likely that a possible election could temporarily add to the volatile situation in Europe, with its barrage of elections already lined up. That said, the New Democracy approach could help restore confidence in the Greek economy in the long term, even at the price of short-term political instabilities. Countries such as Latvia have implemented structural reforms for IMF aid, and despite immediate fiscal imbalances including high unemployment rates, their economies have started to recover. If Greece doesn’t radically change its domestic economic policies, through a new government or otherwise, it may become closed off from financial markets indefinitely.

That said, the New Democracy approach could help restore confidence in the Greek economy in the long term, even at the price of short-term political instabilities.

Even if elections occur, the government needs to understand the severity of the situation. Greece cannot continually refuse to enact legislative measures to reform the labor market and the energy sector. Under the bailout programs, European creditors will only continue to give aid on the condition that Greece implements discussed economic reforms. Thankfully, on April 7, Greece agreed to terms that would create an influx of money into the federal government: reducing its budget for pensions from 2019 and reducing the tax-free minimum threshold from 2020, effectively increasing the income tax. Despite the unpopularity of such policies domestically, this agreement hopefully indicates that Prime Minister Tsipras is willing to risk domestic discontent in light of fears that European creditors will stop releasing money. But he faced a similar impasse in 2015, when the negotiations were delayed for so long that Greece defaulted on a payment to the IMF – the impetus for the current bailout program. If Greece doesn’t implement structural reforms, there it is likely that Greece will need a fourth bailout, which will further delay economic growth.

With a national political crisis and seemingly inescapable economic calamities, Greece has to realistically weigh the solutions at its doorstep. One of the possible solutions includes Greece exiting the EU. A return to the Drachma could potentially help the economy, but there is no evidence Greece would be able to deal with the structural results. If Prime Minister Tsipras is unwilling to reform the economy and his popularity continues to decrease, Greece’s future could potentially lie with the New Democracy party. In either case, it is becoming increasingly clear that the Greek government needs to re-evaluate the gravity of the situation it finds itself – or, rather, has put itself – in today.

Photo

After the UK’s decision to leave the European Union last June, it became clear that London risked losing its status as Europe’s major financial centre. Several major firms that are headquartered in the City of London, in fact, depend on having a foothold in the European common market. EasyJet, a low-cost airline, famously declared it was going to move only days after the referendum. Being inside the EU gives several advantages, both from a fiscal and a regulatory point of view. Given the circumstances, Europe will need to designate a new financial capital, but what city will it be?

The continent’s three major financial centers – Paris, Frankfurt, and Milan – are lined up to reap the benefits of the post-Brexit exodus. Italy has already moved to start the process of reform to create incentives for firms to come to Milan. If the country continues on that path, there could be conspicuous benefits to its economy and to that of the European Union as a whole.

First, it is worth understanding why it is convenient for firms to move away from London in the wake of Brexit. The City of London has been one of the world’s foremost financial centers for centuries, yet its position was strengthened considerably by being part of the EU. In fact, access to the common market is an immense fiscal incentive. With the UK’s departure from the EU, such an incentive would no longer exist.

The example of EasyJet is particularly telling. As an airliner, its revenues come from several different countries. A plane from London to Madrid, for instance, would include a good portion of residents of Spain and the UK, as well as a number of other countries. Given that EasyJet is based in the UK, EU residents do not need to pay import tariffs on the tickets, thus giving the company access to a large pool of customers at a reduced price. This is because the most basic feature of the EU’s common market is that there are no import tariffs between members. When the UK officially leaves the EU, however, EasyJet will face higher barriers and thus impose higher prices on its customers, which would make demand for their tickets fall. It would be more reasonable for them to resettle within the EU, facing only the UK’s tariffs and not those of the much larger EU market. Furthermore, there is a great deal of uncertainty regarding the replacement of the EU preferential trade agreements for the UK’s non-EU trade, yet another incentive to move to mainland Europe. Indeed, these uncertainties have been clearly picked up by investors, leading to a fairly negative stock performance for the company in recent times.

Yet airlines are just one of the many types of firms that may seek to move. Financial services are probably the biggest industry in question, since they face the same incentives to leave as airlines since their market is global. In fact, according to a City of London report, the UK is the largest exporter of financial services in the world, amounting to more than £47 billion. Indeed, the industry as a whole represents 14.5 percent of the country’s GDP.

Italy is too large of an economy to lose; without it, the continuation of the EU experiment would make little sense. Choosing Milan may therefore well be in everyone’s best interest.

Given the impending flight of firms from the UK, it is now up to other EU countries to enact reforms to position themselves as the best possible replacement. Italy has already commenced its plan for Milan. The Select Milano committee, formed by several important political and financial services leaders, has already fleshed out a plan of action. Surprisingly, for a country that is often beaten by inertia when it comes to economic opportunities, there seems to be considerable motivation for this particular project.

The most basic and important aspect of Milan’s plan is to create a financial district with ad-hoc conditions for the operation of a financial system. Indeed, this was one of the very reasons why the City was able to thrive. The City of London Corporation is a separate entity from the many other neighborhoods of London and was thus able to create specific business-friendly conditions in a clearly defined space. Milan’s plan is based on the same idea. By isolating a financial district, it will be easier to enact the many reforms that are needed, rather than applying them on a city-wide or even national scale.

After these changes, several tax incentives can be put into place. Businesses will be far more inclined to come to Milan if they are offered a more convenient deal. Recently, for example, the Italian parliament produced a resolution asking the government to repeal the Financial Transaction Tax (FTT), which had been in place since 2013. At the time, the European Commission had embarked on an initiative to introduce a common tax on financial transactions for all EU members. Such a tax serves to selectively discourage speculation on certain sorts of transactions and promote price and currency stability by reducing excessive activity. The EC’s proposal was supposed to centralize such regulation for the EU. However, only one country has actually implemented the FTT: Italy. The decision to adopt it came at a time of dire economic crisis when the technocratic PM Mario Monti passed a law to ensure Italy’s economic stability within the EU. As things stand, the country’s financial system is penalized by the increased costs of transactions. A study by scholars at the University of Bologna showed that the intermediary costs of financial transactions are almost doubled by the Italian FTT, which is especially harmful given that investors can easily shift to other EU countries that do not impose the tax. Repealing this tax would therefore be an essential first step for Milan’s bid to become Europe’s foremost financial center, unless in the unlikely chance that the other members suddenly adopt it too.

A second central issue is creating a separate judiciary branch for the financial district. Italy’s courts are known to be overcrowded with cases and remarkably slow at handing out verdicts. Indeed, one of the most significant causes of the current Italian banking crisis has been the fact that, on average, it takes more than six years to resolve a bankruptcy suit. This, in turn, puts a strain on banks’ balance sheets. A specialized arbitration court could be set up to ensure an efficient judiciary option, building on the already-existing Chamber of Arbitration of Milan. This would be very similar to the London Court of International Arbitration, a world leader in the field. By establishing a clear and easy system to resolve legal disputes, Italy could effectively mitigate its country-related risk. This is certainly an area lawmakers will need to concentrate if Milan is to have a real shot.

Another important step is to ensure the presence and quality of specialized human capital. The presence of Bocconi University, a top-ranked economics and business school, certainly helps Milan’s cause. Yet, retaining young brains can be as hard as producing them in the first place. Equally difficult is attracting high-skilled individuals from abroad. To this end, an interesting proposal that has already been articulated as a parliamentary resolution calls for the creation of tax incentives for those who wish to return to Italy from abroad. The idea underpinning this policy is that Italy has very high income taxes, which would create a disincentive for high earners in particular. People in high wage brackets are more likely to settle where a smaller portion of his wage is being absorbed by taxation. Some incentives have already been put into place: the Minister of Economy and Finances Pier Carlo Padoan recently announced the implementation of a flat tax of €100,000 for high net-worth individuals on income from abroad, which experts consider a very good deal.

Reforms are likely to be the cornerstone of any decision with regards to the new financial capital of Europe, and rightly so. Yet the unique circumstances in which the EU finds itself offer a very valid rationale for choosing Milan. With Britain’s farewell, Italy becomes the union’s third-largest economy and amongst its most troublesome. Plagued by almost two decades of sluggish economic growth and a national debt that is amongst the largest in the world, it is a serious threat to the economic stability of the EU. The European Union survived Brexit; it could probably also withstand the downfall of one of its smaller members, Greece or Portugal, for example. Yet, Exita would be the last nail in the coffin. Italy is too large of an economy to lose; without it, the continuation of the EU experiment would make little sense. Choosing Milan may therefore well be in everyone’s best interest.

Some claim that Italy’s unhealthy economy makes Milan an unwise investment decision for the European financial services industry. This is not in itself a problem. What firms may be concerned with, more than economic growth in general, are the causes of such stagnation, many of which are dealt with by the reforms discussed above. Indeed, the central idea of the project is to create a context in which the country-related risk for incoming firms is mitigated by airtight legislation. This does not mean, however, that Italy could not reap the benefits of increased economic activity brought about by an influx of new business. It would be a substantial economic stimulus that could help kick-start the Italian economy. Indeed, one of the most substantial issues for the country since the start of the Great Recession has been weak investment, which is still failing to pick up. An influx of foreign firms would certainly be a significant boost to an economy in need of help.

Perhaps even more importantly, the reforms that Italy could enact to attract foreign firms may also have a structural impact. Indeed, the economic issues it is facing are not merely the result of contingency; there are severe structural issues with the country’s economy, including a byzantine bureaucracy and a crippling system of taxation. The reforms discussed above aim at fixing these issues and may well become a blueprint for national legislation. Milan could be an experiment-city for Italy’s future economic reforms, since starting on a small scale would be advisable from both a cost and practicality perspective. The economic stimulus that would result would in turn help expand the scope of the legislation. Thus, as well as making sense from a European perspective, Milan’s reforms could have considerable positive trickle-down effects for the Italian economy. It is now up to Italian lawmakers to seize this opportunity.

 

Photo

 

Prior to the Brexit referendum, the Remain camp was led by Britain’s foremost politicians. Now, it is a ship without a captain. The Conservative Party has coalesced around Theresa May, a former Remainer who has since become the champion of a hard Brexit. Other Tories, members or supporters of the Conservative Party, who supported the losing side have drowned in an abyss of silence or conveniently jumped ship. Yet what is most striking is the Labour Party’s teetering stance on Brexit. Given that 69 percent of those who voted Labour in 2015’s general election are estimated to have voted Remain in the referendum, one would have expected the Labour Party to become the champion of a soft Brexit, or perhaps even oppose the UK’s departure from the EU altogether. Some Labour leaders have indeed opposed Brexit altogether by arguing that, in a parliamentary democracy, a Member of Parliament has a duty to his or her constituency over the outcome of a referendum. Nevertheless, the party’s official line has been to support Brexit, albeit on somewhat complicated terms.

The Labour Party’s reserved rationale is not hard to follow: How can politicians deliberately oppose the will of the people? Opposing the result of a popular referendum is tantamount to political suicide. For Labour, however, the opposite stance is proving just as fatal. Tony Blair, Prime Minister from 1997 to 2007, was the man who reformed and led the Labour Party to unprecedented victories in the 1990s. On the February 17, Blair gave a speech that articulated exactly what Labour’s stance should be: opposite both the government’s management of Brexit and Brexit itself. He proposed holding a second referendum once the terms of Brexit have been negotiated. A new Blairite revolution is exactly what Labour, and those who are still in favor of staying in the European Union, need.

The current state of the Labour party is dismal. A recent study conducted by YouGov and The Times estimated that Labour would obtain 24 percent of the votes if a general election were to be held soon, a 7 percent drop from 2015’s already meagre outcome. Only 16 percent believed that Jeremy Corbyn, the leader of the Labour Party, was the best choice for Prime Minister. The cause of the lackluster support, the study implies, is to do with Brexit and the Labour Party’s response to the referendum. When participants were asked about the most important issue facing their country, the most common answer was Brexit. Concurrently, only 10 percent of the sample population believed the Labour Party would best handle the Brexit negotiations. Thus, of Britain’s most pressing issues was the belief that the Labour Party’s platform is failing. In addition, British opinion is generally dissatisfied with their current leadership. More people believed Theresa May’s government has been doing badly with regards to Brexit negotiations (43 percent) than well (36 percent).

So, what do these numbers tell us? Brexit-related issues are where the Labour Party could reap votes, as a significant number of people are displeased with the Conservative Party’s work so far. However, most people also seem unhappy with the Labour Party’s leadership. This is a huge missed opportunity, especially given that the last study conducted by YouGov and The Times prior to the Brexit vote showed that Labour had the numbers to win a general election. This shift demonstrates that the way Corbyn and his Labour Party are dealing with Brexit is tarnishing their electoral potential. Either a change of leader or platform is in order. Or, perhaps, the Labour Party needs both.

A new Blairite revolution is exactly what Labour, and those who are still in favor of staying in the EU, need.

Tony Blair became Prime Minister in 1977 in a landslide election, running as a Labour Party leader concentrating on centrist themes and abandoning the party’s traditional embrace of nationalisation. Blair espoused a more liberal economic approach, which widened Labour’s electoral base. He then went on to win two more elections in 2001 and 2005 but resigned in 2007 after a power struggle with his Chancellor of the Exchequer and former ally, Gordon Brown. Subsequently, Brown lost the 2010 general election and the party steered back towards a more classical socialist platform. In the last few years, Blair’s leadership has been heavily criticised. In retrospect, many accused him of not preparing the UK for the economic crisis and actively supporting the Iraq war. The latter quagmire was outlined in 2016 by the Chilcot Report, which, owning up, Blair described as, “real and material criticisms of preparation, planning, process and of the relationship with the United States”.

No one can deny that Brexit is a game changer. And perhaps it can be for a former PM with a tarnished legacy. This may have been exactly what Tony Blair had in mind when he walked on stage at Bloomberg’s London headquarters in February of this year. 

At first glance, his speech is nothing more than a presentation of some of Blair’s ideas on Brexit, the most interesting of which is a proposal for a second referendum. While he did not mention a second referendum explicitly in the speech, he made several allusions to the idea, and has been fairly vocal about it on previous occasions. His own analogy is very helpful to understand his argument: Brexit is like a house swap. Say you were looking to move and were considering the purchase of a certain property. One group of friends tells you the place is amazing and that you should definitely buy it, and another tells you it is awful and you should remain where they are. Would it be reasonable for you to make a decision before actually seeing the house? Surely you would want to see the property with your own eyes before committing.

Similarly, the British people, who, by a majority, opted to leave the European Union, knew little more than the opinions of two groups of politicians. They did not know the exact shape the settlement would take or the details of the terms. An important distinction is necessary here: Blair was not arguing that the British people did not know because they were led to believe a false truth, or that they are “too stupid to get it,” as one political commentator complained. Blair was instead stating a fact; one cannot know the terms of an agreement before they have been negotiated.

The UK government and the EU are about to start those negotiations and nobody knows where they may finish. Certainly, Britain will incur some costs, both direct and indirect. For instance, it is now understood that the EU expects the UK to pay a good chunk of previous obligations, which the Financial Times has estimated to be around €20 billion. Some predict the cost may rise to €60 billion, as the UK has liabilities and pledges in many sectors of the EU budget, like pension contributions. Jean-Claude Junker, President of the European Commission, has already warned that Britain will face a “very hefty bill.”

Another burning issue includes defining trade terms with EU countries and replacing more than 50 preferential trade agreements, which account for two-thirds of total British trade. The biggest fear is that if the negotiations fail, the UK will need to trade by WTO rules and thus face higher tariffs and quotas on trade than it currently does. Of course, these considerations are taking place amid growing secessionist sentiments in Scotland, Northern Ireland and Wales, which could become independent from the UK in order to rejoin the EU.

These concerns were not commonly discussed in the time leading up to the referendum, yet they may become a reality once the negotiations are over in 2019. If this becomes the case, can Britons change their mind? Tony Blair thinks they both can and should. The British people did not provide a mandate for “Brexit at any cost.” Instead, in 2019, when the terms have been defined clearly and Britons are able to ascertain what Brexit actually means, there should be a second referendum asking whether they support Brexit at the given cost.

Most expect Blair to take an informal advocacy role on this issue within the political scene. Yet, one should not exclude the possibility that he is eyeing official power. A large section of his speech was dedicated to pugnacious criticism of Theresa May and her government. He explained how much of what the Prime Minister has said in the last months is contradictory. The Prime Minister wants Britain to be a “great, global trading nation,” yet seeks to achieve that goal by leaving the largest trading union in the world. Moreover, he accused the government of neglecting many of the burning problems the country faces, such as the NHS crisis. Blair’s assessment of the Tory leaders is clear: they are not driving the bus, they are being driven.

Blair had similar criticism for his own Labour Party, announcing that “the debilitation of the Labour Party is the facilitator of Brexit.” Blair’s diagnosis is nothing more than what millions of Britons think. Labour Party leader Jeremy Corbyn has no chance of winning an election, not even against the Brexit-frenzied Conservatives. Labour should be the force that stands up to Brexiteers, but it can only achieve so much if its leader alienates the electorate and refuses a change of platform. Blair’s veiled attacks may suggest that he is simply hostile to the Prime Minister and Corbyn because they oppose his beliefs, or he is starting to fire shots at his future opponents.

Blair’s ideas have already begun to gain some traction. In the recent debate in the House of Lords on the Brexit Bill, several peers echoed some of Blair’s message. Liberal Democrat Baroness Kramer, Blair’s life peer, was amongst them. Labour’s former Chancellor of the Exchequer Lord Darling stated that the referendum did not give the government a “blank cheque.” Another Labour peer quoted Blair, saying that the “debilitation of the Labour Party” contributed to Brexit. This debate demonstrates two primary consequences. First, Blair still has an ideological footing in Parliament. Second, many in the Labour Party think Corbyn cannot lead through these troubled times.
Blair offers the two elements Labour needs most: a strong anti-Brexit stance and a pristine electoral record. The only thing that may hold him back is his controversial reputation. The magnitude and intensity of the negative sentiments Blair invokes may be enough to stall any effort to regain power. A more realistic hope is that someone else in the party, perhaps someone new and undamaged, takes on the challenge. However, it may take someone who has nothing to lose to take the job nobody seems to want. Which bring us right back to Blair.

 

The declaration that “tyranny naturally arises out of democracy” is the famous, anti-democratic thesis of Plato’s Republic. While the Ancient Greek philosopher’s criticisms of direct democracy have led to the widespread denunciation of such systems of government, the specter of absolute democracy continues to gnaw at political institutions worldwide, remerging as a referendum. Indeed, referenda have been used to produce several controversial decisions this year: It was the mechanism by which Britain voted to leave the European Union, Colombia voted against a peace agreement with The Revolutionary Armed Force (FARC), and Hungary cast an invalidated vote to limit the flow of refugees. Although the outcomes of each referendum may be controversial in and of themselves, the initial decision to utilize a direct vote to make such major political decisions is one worth criticism. The reckless use of referenda demonstrates the structural weaknesses of direct democracy, reaffirming it as a system far more dangerous than forms of representative government. Just as Plato believed, direct democracies often lead to poorly reasoned political decisions, encourage the proliferation of sensationalist rhetoric in the presence of misinformation, and eliminate political checks and balances for minority groups.

direct democracies often lead to poorly reasoned political decisions, encourage the proliferation of sensationalist rhetoric in the presence of misinformation

The issues referenda create are not dissimilar to those that direct democracies have suffered from since Plato initially condemned them. As Professor of Political Philosophy Jason Brennan argues, it is a shocking display of optimism to expect the public to fully account for the long-term consequences of major political decisions. Voters have neither time nor expertise to weigh the costs and benefits of issues in the way that professional policymakers can. This naturally contributes to often capricious voting patterns and short-term thinking. Moreover, political scientists have found that everything from weather on Election Day to recent performances of local sports teams can powerfully affect election outcomes.

Beyond this, voters also often hold views that are contradictory in nature. For instance, they support governmental debt reduction but reject the spending cuts needed to do so; they support military expansion and strong national defense but reject military intervention. Brennan argues that this widespread evidence of voter confusion justifies the establishment of an epistocracy – or rule by experts – in the place of an absolute democracy. While Brennen’s conclusion is certainly controversial, the evidence of how voters actually approach elections demonstrates the peril of placing nuanced policy issues on the ballot.

Moreover, just as Plato condemned Athenians for utilizing rhetorical and emotional appeals to sway democratic voters, referenda also tend to be swayed by similar techniques that often have little grounding in actual fact or policy. There is clear evidence of this in the referenda held in the United Kingdom, Hungary, and Colombia. Emotional rhetoric demonstrably altered the ways that people voted when complicated economic, sociological, political, philosophical, and historical arguments wouldn’t. For instance, prior to the Brexit vote, the Leave campaign sought to capitalize on a blend of xenophobia and fear of terrorism by linking an exit from the European Union to the effort to limit immigration and refugees. Misinformation and hyperbole abounded as the Leave campaign warned of the UK reaching its “Breaking Point.”

This was true in Colombia, where the peace agreement between the government and FARC guerillas failed by a margin of 0.4 percent, with only a 37.4 percent turnout rate.

Yet even if the failures of referenda are simply the necessary cost of public engagement in the political system, referenda generally fail to capture the will of the public as a whole. The stated goal of referenda is often taken to be the attempt to give the people a say and to ensure that out-of-touch politicians can’t trample over the people they govern. However, that goal becomes confounded when only a small number of people actually show up to the polls. This was true in Colombia, where the peace agreement between the government and FARC guerillas failed by a margin of 0.4 percent, with only a 37.4 percent turnout rate. It was also true in Hungary, where about only about 44 percent of voters showed up to vote on a migrant quota referendum that was also boycotted by several major parties. Even in the UK’s groundbreaking decision to leave the European Union, approximately 72 percent of voters showed up to the polls.

Low voter turnout is a crippling defect for modern referenda, not only because it undermines the stated goal of gauging the voice of the people, but also because the number of votes that distinguish one outcome from another is often quite small ­– a direct contrast to its potentially momentous consequences. Indeed, with such a poor turnout rate, it seems likely that if just a small number of additional voters had heard a particular speech, seen a particular political ad, or hadn’t been deterred from voting by bad weather, the results of any of these referenda might be very different. Advocates of referenda consequently make the mistake of supposing that the results of a public vote with close margins and poor participation are representative of the will of the people as opposed to an infinite array of random factors that swayed the results, producing a temporary majoritarian consensus.

California’s 2016 ballot featured 17 referenda on such major issues as the death penalty and prescription drug prices.

Beyond this, low turnout in a referenda is almost always present among low-income individuals and minorities. These voters face the largest structural barriers to voting, either due to discriminatory policies, a lack of access to transportation, or the high costs of missing work to go to the polls, yet they will often be some of the most affected by these decisions. Moreover, referenda often require a higher level of political engagement, which is particularly uncommon in low-income communities that lack access to education. For example, California’s 2016 ballot featured 17 referenda on such major issues as the death penalty and prescription drug prices. It’s simply unreasonable to expect a single mother balancing two jobs to learn enough about these issues to make an informed decision. Moreover, in the likely event that she simply chooses not to vote at all, the entire stated political purpose of a referendum is undermined.

Referenda also work to systematically exclude those who cannot vote. For instance, some referenda affect constituencies that are not represented in the public vote because they are not granted the right to vote. While disenfranchised criminals are the most obvious example, the issue is actually far more widespread. Consider, for instance, that Brexit failed to account for the large number of non-British EU workers who could lose their jobs as soon as Article 50 is invoked.

In legislative political processes, non-voting and minority constituencies have greater opportunity to make their voices heard through interest groups and smaller, representative districts. As a result, decision-makers have the ability, the electoral incentive, and the mandate to consider the implications of their decisions more than voters ever will. Whether or not legislators are successful at supporting minority perspectives is another question entirely. However, good legislatures can prevent a tyranny of the majority from making arbitrary, momentous decisions that ignore the voices of minority demographics.

In the Republic, Plato rightfully pointed out that society works best when there is a governing body that is solely tasked with the responsibility of ruling and enacting policy. While there ought to be checks on such powers, political decisions should be made by politicians and experts. Governments ought to abandon the notion that they can expect the public alone to produce the best possible political outcome or that such a situation is even desirable. Doing so may help to avoid a scenario where they are forced to enact referenda-induced policy changes, knowing that they are not in the best interest of the country – something that Theresa May, tasked with leading Britain’s exit from the EU, is currently grappling with.

It is an injustice to both a country’s domestic population as well as the international community for politicians to abdicate political responsibility in the ways that they have in Columbia, Hungary, and the UK. Governmental officials are useful because they are meant to take ownership of the world’s most complex political decisions and be held accountable for their repercussions. The redirection of this responsibility to the public can have pernicious effects on the integrity of a governing body by providing a pipeline for populism to suppurate into the political mainstream and control public policy. The use of public referenda disfigures the just organization of the state and often results in the marginalization of minority groups, the proliferation of misinformation, and the partition of society into a domineering majority that can crush the minority with a simple vote.

This is just as Plato expected.

A mighty shock to our electoral system, November 8, 2016 will likely live on in infamy. Yet even before the election, 2016 had long offered murmurings, shocks, and jolts that quietly and then indiscreetly pulled at the threads of the current Western Order. The writing, so they say, was on the wall. And while Brexit and the rise of President-elect Trump outline a radical backlash against political elites, the popularity of secessionist rhetoric, most notably by the “Calexit” movement, may offer the single most damaging indictment of existing liberal attitudes worldwide.

For the uninitiated, Calexit was a trending hashtag on Twitter in the immediate aftermath of Donald Trump’s presidential victory. The term Calexit, which is a reference to the Brexit — the United Kingdom’s shocking decision to retreat from the European Union — is the brainchild of the Yes California Independence Committee. Like its British counterpart, the United Kingdom Independence Party (UKIP), Yes California is founded on a secessionist platform that decries the inequity of the relationship between a given state and a larger system of governance. The party, which has long been at the fringe of mainstream politics, leveraged a slick social media campaign — amidst a hysterical atmosphere, sparked by Trump’s election — to catapult itself into the broader cultural consciousness. Ultimately, the viral popularity and seeming cultural cachet of Calexit, and by extension the pro-independence agitation of Yes California, may suggest the emergence of a new breed of populism.

In some respects, this novelty is nothing more than a rebranding of existing movements. The Calexit name, for example, is a literal adaptation of Brexit for an American audience; with each tweet and retweet the new hashtag seeks to capture and Americanize the populist fervor responsible for the UK’s pending divorce from the EU. Moreover, this coopted rhetoric lends an air of hopeful political legitimacy to that frustration, which cries: any odds they can beat, we can beat too. Finally, Yes California has also adopted an exceptionalist tone akin to that of the UKIP in the weeks before the referendum vote. For example, the party’s website claims that independence would grant California the liberty to best utilize its “unique population, culture, and economy” to “exert…a positive influence on the rest of the world” beyond what could be done as “just a U.S. state.”

But most of the similarities end there.

Consider how the UKIP flamed popular frustrations to cultivate an increasing cohort of backers. Infamously, the party greenlighted an anti-immigrant advertisement that depicted refugees filing into Slovenia with the ominous title: “BREAKING POINT.” The “thousand words” spoken by this image are unambiguous: it argues that the EU’s open borders policy, responsible for a massive influx of Middle Eastern and Eastern European migrants into the UK, has disastrously impacted the UK’s economy and culture. Immigration, the UKIP argues, pushed native individuals out of jobs, altered familial trajectories, and brought the once-foreign into the house next door. Ultimately, the UKIP fixates upon tropes related to the ugliness of globalization — here considered interconnectedness across social, political and economic divides — wherein the idyllic promise it once held failed anyone outside of metropolitan hubs like London. In its simplest form, support for Brexit was a reassertion of value and self-worth by those who increasingly viewed themselves as alien in the new UK society.

Ultimately, Calexit is a sort of self-sabotage, a repudiation from within.

The Calexit case is, in many respects, the flip side of the same coin. While Trump’s election and Brexit both reflect the same fundamental frustrations over globalization, Calexit is not a conservative populist movement. It’s the converse: a new subspecies of liberalism. Calexit captures frustration with American politics from a newer vantage. In overly simplistic terms, Brexit (and the election of Donald Trump) chart an outsider’s frustration with the political establishment. Calexit, on the other hand, is grounded within that elite bubble. In other words, the people agitating for more definitive borders between California and the rest of the Union do so from within California society. Their view is seemingly tinged with myopia that overlooks how industries like information technology, agriculture, and construction — which account for 12 percent of California’s GDP — benefit from freer exchange of people and ideas. Ultimately, Calexit is a sort of self-sabotage, a repudiation from within.

The strategic vision offered by Calexit is even at odds with other populist liberal movements like the Bernie Sanders campaign. Previous grassroots liberal movements sought to make the political arena more inclusive, offering the layperson an expanded role at the table. This re-invigoration operated within the confines of the current political structure; its revolution was more moderate modification, rather than radical deconstruction, of existing structures. Calexit has directed similar anger towards a different end. In lieu of seeking to re-imagine the existing, it offers a means of total escape.

Ultimately, Yes California’s burgeoning popularity is a striking indictment of the progressive idealism central to California politics. Traditionally, the state has strived to cultivate a culture of liberal innovation, spearheaded by a left-leaning intellectual class that agitated for a wide range of social and economic policies. These policies — which address issues ranging from public smoking and vehicle emissions standards to healthcare for undocumented immigrants and, most recently, multilingual education — chart the state’s pioneering political clime. This political environment, in turn, speaks to a deeper cultural attachment to and reverence of innovation and open-mindedness. Beyond facilitating the rise of the state’s tech and biotech industries — both of which venerate novelty — this sociopolitical environment encouraged immigration and the creation of an increasingly multicultural California.

In choosing to forsake the existing sociopolitical framework responsible for California as we know it, the Calexit movement is rejecting the unifying power of those structures. By extension, the movement denies the ideals of openness and multiculturalism that fostered California’s existing political landscape. Or, at the very least, it restricts who is eligible to receive their benefits. This subterfuge from within lends Calexit a distinctive edge; if the globalization experiment is seen as failing those in supposed havens like California, whom exactly did it benefit? Even if Calexit is nothing more than an escapist fantasy — the final, impenetrable safe space for the coddled youths and snobbish elites, as Breitbart might lead one to believe — its cultural cache and viral popularity are damning. The movement’s reactionary refusal to try and bridge deep-seated divisions is a sort of self-defeating catharsis and a recasting of liberal-minded openness as a less universally accepting ideal.

Photo

Werner Weidenfeld is a German political scientist and served as the director of German-US relations for the German government. A sought-after commentator on current affairs, he has written extensively on the politics of the European Union and transatlantic issues. He currently heads the Center for Applied Policy Research, a Munich-based think tank.

 

The Brexit vote has sparked a lot of commentary on the state of the EU. What does the vote mean for the European idea? Is there a need for reform at the institutional level of the EU?

 

There is a need for development in terms of European integration with or without the Brexit. Granted, the Brexit vote has made this situation more visible in the eyes of the public, but even if the UK had voted to remain, this need for reform would have existed. The first important point is that that the vote was sparked by a domestic calculation: It was not so much a vote on European politics as it was an attempt by Prime Minister David Cameron to create an outlet for the domestic pressure he was facing at the time. Back when Cameron first announced the referendum, he was convinced it would produce a “yes” for the EU – he was wrong. Hence the whole thing was first and foremost a domestic miscalculation, which we have to keep in mind before rushing to ask what this means for the fate of the EU.

 

The second point is that the UK never really belonged to Europe. When a number of states were articulating a vision leaning towards a kind of “United States of Europe” after World War Two, the UK favored a more restrictive approach and it was British intervention that scaled down these great ambitions somewhat. When more efforts for a united Europe followed in the 1950s, there were two detractors: Moscow and London. It was only in the 1970s that the British expressed an interest in joining, but overall, no major impulses for European integration ever originated in London. Thus, in terms of European integration, this is not a huge loss. No doubt, the EU is losing 12 percent of its population and 18 percent of its GDP, so it’s not irrelevant, but it is not of existential importance.

 

What about the effect of the Brexit vote on Euro-sceptics in other countries? In the past, you have been rather skeptical about the idea of a potential ‘domino effect’ throughout the EU – why?

 

First of all, a domino effect could only be conceivable if the EU were to now make concessions and allow the UK a ‘special deal’, but they won’t do that, in their own interest they’re going to remain tough.

 

Second, and this is interesting, most of the media coverage in the wake of the vote has been negative – even in the UK, there were many regretful voices, calls for another round and so on, and throughout the EU it’s been the same. This has actually led to a slight surge in pro-EU opinion across the continent. If you look at Germany, recent polls suggest the EU is more popular now than it was before the Brexit vote. What the EU has to deliver now is structural reforms. It needs to be capable of acting quickly and if people notice that Brussels is not able to solve problems they get frustrated – that’s where the real challenge lies.

 

A prominent feature of the Brexit campaign was a sense of disillusionment or cynicism towards untrustworthy ‘experts’ or ‘elites.’ Is this comparable to the widespread skepticism against the press and other public institutions in Germany and other EU countries?

 

No doubt, you can see the expression of this attitude not only in the UK, or in Germany with the rise of a new far-right party, but also in similar form in France, the Netherlands, Hungary, and Poland. And it’s taking on particularly dramatic features in Austria, where the presidential candidate of a far-right party is polling at nearly 50 percent. Many people are distancing themselves from established political actors and parties because they feel disillusioned, left alone and frightened. They either decide to either withdraw from politics altogether or to look for some outlet for their frustration.

 

However, if you look at Germany’s new far-right AfD party, it is utterly chaotic. Its founder left to found a new party, saying he was embarrassed by the “monster” he had created. Meanwhile, there is tremendous infighting within the party. In the old days of traditional party politics, these would have been harbingers of doom. Now, the party remains more or less on course because it doesn’t really matter to voters who are mainly looking for a way to express their frustration.

 

And how do you address this as a moderate party?

 

Those who talk of moderate parties having to move more “to the right” or “to the left” are missing the point for two reasons. First, the voters flocking to right-wing populist parties often do so because they feel like they no longer understand developments around them. Moderate parties must offer a viable and compelling narrative as to where their society is going in order to help citizens orientate themselves. Instead most of them are currently caught in ad-hoc crisis management – the refugee crisis is one example.

 

Second, people want politicians to care about them and to take care of them, so establishment parties have to expand on that theme of caring. When asked about their support for right-wing populists, people often cite as their number one reason that “they know our concerns.” So moderate parties have to be better at presenting and explaining their analytical take on society and they have to give people the sense that they care about them.

 

But doesn’t the voters’ skepticism also reflect their real-life experiences? The places that were most in favor of Brexit tended to be ones that had also felt left behind economically over the past decades.

 

Certainly, but you cannot solve this problem by declaring Brexit. In fact, you’re worsening it, since the very regions that voted for Brexit will suffer the hardest from the economic shock caused by the vote. If there is one region that will suffer least it is London, where people didn’t vote for Brexit. So this dynamic will be exacerbated.

 

Let’s take a look at the United States. Your statement that disaffected voters often care less about concrete solutions than about the feeling that their concerns are being acknowledged seems to apply here, too. To what extent are comparisons between the populism of Donald Trump and that of leading Brexiters like Nigel Farage or Boris Johnson in order?

 

There are definitely some parallels. There is a dramatic degree of social polarization in the US, partly because it is simply no longer a big melting pot where a ‘rags-to-riches’ path is open to everyone. A candidate like Trump wouldn’t have stood a chance in a more harmonized social atmosphere, but he has made his way to the Republican nomination because he is able to portray himself as a champion of the common man in opposition to the Washington elite. His rabble-rousing appearances distract from the fact that he is, to some degree, part of that elite himself. But his ability to do so is an expression of this polarization in the US. It’s not identical to the European phenomenon, but there are indeed some clear parallels.

 

If, despite everything, Clinton is victorious in November, what will her victory mean for US relations with Europe?

 

In my opinion, we would see a slightly smarter version of Obama’s policies. She would carry on the main features of Obama’s policies but she would likely engage with the Europeans in a more strategic manner. Obama was polite, but Europe simply was not part of his global strategy.

 

Which key issues will shape transatlantic relations the most in the coming years?

 

One of the challenges is building a transatlantic strategic elite which can rebuild strategic networks and pursue a shared global political agenda. That kind of cooperation has suffered since Obama’s “pivot to Asia” and under his predecessor. In my opinion, this is something that would be quite possible with Hillary Clinton as president, and it would change the world’s political architecture somewhat.

 

 

We’re out.”

With this laconic declaration, the Daily Mail delivered Friday’s simple, momentous truth to a polarized Britain; the torrent of patriotism and triumph on one side was matched only by the apocalyptic lamentations of the other.

The United Kingdom chose to leave the European Union.

While much of the county’s political establishment was left to reflect on why the unique, albeit tepid, pro- “Remain” alliance of Labour’s Jeremy Corbyn and Tory Prime Minister David Cameron failed, the international system watched in apprehensive shock. The Brexit (“Leave”) campaign, orchestrated chiefly by the UK Independence Party Leader Nigel Farage with the Conservative Party support of Boris Johnson and Michael Gove, prevailed by capitalizing on festering nativist sentiments and the growing global disillusion with mainstream liberal politics.

Much has already been written about the factors that encouraged Britain’s decision; these include Labour’s weak endorsement of “Remain,” anti-immigration paranoia kindled by the refugee crisis, David Cameron’s low approval rating, the perception of the EU as undemocratic, and years of British austerity. And yet, what was perhaps most immediately baffling was the Prime Minister’s initial, catalytic choice to call for a referendum.

In doing so, Cameron imparted a vital international decision into the hands of an often capricious, uninformed, and misled public, gambling away the fate of the international system and transforming an internal Tory schism into a case study in the perils of ‘tyranny of the majority.’ For this, the once youthful and optimistic representative of Witney will justifiably be regarded as one of the 21st century’s most reckless Western leaders.

While the concept of “tyranny of the majority”—a phrase used to describe the consequence of majority-rule democratic systems – was first used by John Adams, the broader concept can be traced back to Plato’s Republic. This fear of “tyranny of the majority” also served as a kind of ideological basis for the United States political system; Thomas Jefferson famously stated “Democracy is nothing more than mob rule, where 51% of the people may take away the rights of the other 49%.”

And in the EU Referendum, Jefferson’s famous proclamation was less than a percentage point off.

In a vote that exemplifies this notion of “tyranny of the majority”, 52% of eligible British voters were granted the prerogative to dramatically influence the future of an entire continent (or world, if you have a palate for the dramatic).

By calling for a referendum, Cameron left an extremely complicated international dilemma in the hands of a public that patently did not – and could not be expected to – uniformly understand the consequences of its decision. He let the under-educated, populist, and often fluctuant votes of a mere 52% of eligible voters make a presumably irrevocable decision on behalf of the other 48% as well as unrepresented adolescents and non-British EU workers.

Cameron imparted a vital international decision into the hands of an often capricious, uninformed, and misled public, gambling away the fate of the international system and transforming an internal Tory schism into a case study in the perils of ‘tyranny of the majority.’

Many political theorists and movements have recognized the deficiencies of absolute democracy by positing that minority groups would cease to have any meaningful political power against a collective majority. It’s easy to see why such a system would result in vast abjection in the United States. Imagine if Arizona – a state that is 84% white – used a system of absolute democracy. Needless to say that, in the absence of a representative system, Arizona’s infamous 2010 anti-immigration law would be a minor offense within a system that no longer veiled its antagonism towards minority groups.

While the UK is not as ethnically diverse as the US, the EU Referendum has revealed similar demographic divisions. For instance, although approximately 75% of young people voted to remain, around 60% of voters aged 65 and older chose the converse. This is to say that older citizens were allowed to seriously influence the result of a decision that would most dramatically affect the younger populations they generally voted against.

Beyond this, London and Scotland voted to remain while the more homogenous and rural parts of England opted to leave. To many “Remain” voters, ‘rural, racist, old England’ swayed the results of an international decision, driving the pound to its lowest value in 30 years while increasing the possibility of greater austerity measures and cuts to the National Health Services (NHS) as well as long term damage to the British economy.

However, the effects of Brexit will not be limited to British voters; the UK’s decision will almost certainly have serious consequences for the international community, especially EU member states. Non-British EU workers in Britain are now in a precarious position as are European businesses that have formal dependencies on the UK.

By holding a referendum, Cameron errantly assumed that British membership was a question only for the British people; that is, one that excludes the roughly quarter-million of non-British EU workers. Given the severe ramifications and uncertainty that such groups can expect to see in the coming months, the failure to provide a representative force in the decision of whether or not to leave the EU is shameful.

Moreover, the victorious “Leave” campaign led by the patently, repeatedly racist Nigel Farage has provided a precedent for far right groups in other European countries to call for similar referendums (e.g. France’s right wing party has called for a ‘Frexit’).While the EU is certainly a flawed institution and there may indeed have been justified reasons for choosing to considerably slacken the UK’s relationship with it, the EU Referendum was a gift to the far right and the anti-immigrant beliefs that have increasingly begun to suppurate through emboldened xenophobes.

Beyond all of this, only days after the referendum results were compiled and released, citizens and major publications that supported the “Leave” campaign expressed remorse for their decision. Over one million UK citizens who voted in favor of Brexit have already expressed their desire to change their casting while a “Leave” voter started a petition calling for a second referendum that received around two million signatures in 48 hours. It now seems almost doubtless that if a second referendum were cast today, it would have resulted in a decisive “Remain” victory.

This caprice contradicts Cameron’s claim that “the British people have made a very clear decision to take a different path.” Instead, the aftermath of the referendum has revealed significant numbers of British voters to be dangerously misled and uncertain, swayed by sensationalized anti-immigration rhetoric and dedicated to fulfilling the fleeting wish to puncture the political establishment in any way possible.

As some British public figures have explained, it’s a stupefying display of optimism (or worse, naivety) to believe that the public can fully understand the economic entanglement between the UK and the EU and the consequences of its rupture. This is to say nothing of the indirect ramifications of Brexit, including the possibility of a Scottish exit from the UK, the subsequent inability of Britain to maintain its nuclear weapons, and the broader damage to post-World War II liberal idealism.

The prolific presence of misinformation also considerably affected the debate over the referendum. This is made clear in “Leave’s” infamous ‘bus of misinformation’: the red vehicle that broadcasted criminally misleading promises to spend money on the NHS instead of the EU, appealing to populist sentiments and making assurances the “Leave” campaign had no intention of keeping.

Beyond this, Boris Johnson was very swift to laud the possibility of recreating British trade agreements with the EU, on – and here’s the important part – British terms. However, if the UK does strike a new trade deal with the EU, it will almost certainly be expected to abide by the previously enforced EU regulations that Johnson had so fiercely lambasted. Of course, Brussels now has an even greater incentive to impose these restrictions in any future deal as they hope to deter future “Leave” campaigns.

But why weren’t Cameron’s warnings of economic catastrophe heeded? While his weak approval rating certainly did not help turn favorable ears towards him, Cameron adopted the Sisyphean task of presenting the nuanced and complex economic consequences of leaving the EU in a way that would provoke a passionate, if not fearful response on par with Nigel Farage’s anti-immigration rhetoric.

However, Farage’s campaign, which was aided by a broader fear of Islamic extremism, presented British citizens with simpler and more sensationalistic terms upon which to vote. Put simply, the fear of an immigrant taking your job or ISIL bombing your town is one that is far more prevalent than concerns over growth, investment, interest rates, or international cooperation. Neither the nearly universal allegiance of economists against the “Leave” campaign, nor the exhortations of most British Members of Parliament and international leaders were enough to deter the effects of Farage’s fear-capitalizing rhetoric.

So when David Cameron asserts that the British people made a ‘clear’ decision to leave the EU, he asks us to disregard the influence of the misinformation, unpreparedness, and sensationalistic rhetoric that helped provoke the vote’s outcome.

Hours after the vote results were counted, searches in the UK asking ‘what is Brexit’ and ‘what is the EU referendum’ flooded Google. Evidently, like a hangover after an inebriated evening, a large number of British voters were left to question the consequences of their decision and – for a particularly confounded group – what it was that they had helped induce.

Britain did not voice a clear answer to the referendum. Instead it gave a polarized, vastly uninformed, often misguided, and unconfident majority vote. If the Brexit Referendum proves one thing, I think it’s this: politics ought to abandon the fantastical, delusional expectation that the public develop an informed consensus on major political issues. It’s not just unrealistic; it is an overtly unjust betrayal of political responsibility to leave a question of Brexit’s magnitude exclusively to the public.

In his criticisms of popular votes and absolute democracy, Plato conjured up the “Allegory of the Sailors and Captain” in which he characterizes the relationship between sailors (representative of the masses) and their captain (representative of ‘philosopher-kings). Here, the former is convinced that “he ought to be the captain, despite the fact that he’s never learnt how… they all maintain that it isn’t something that can be taught”. Yet, they don’t understand the extreme intricacies of sailing (such as navigation), as a captain would, or even that a need for such knowledge exists. As Socrates puts it, “they completely fail to understand that any genuine sea-captain has to study the yearly cycle, the seasons, the heavens, the stars and winds, and everything relevant to their job, if he’s to be properly equipped to hold a position of authority in a ship.”

While the sailors ought to have a say in what goals their captain sets and what destinations are ultimately desirable—the maintenance of a properly functioning ship requires this—the captain is the only member fit to determine how to get there. By not recognizing this, the sailors risk the destruction of the ship, the failure of their voyage, and the descent into tyranny.

Photo

Britain really wants to know: Should it stay or should it go? The concept of British exit from the EU, popularly dubbed “Brexit,” has dominated headlines in advance of the country’s June referendum on EU membership. Brexit’s supporters have railed against perceived and real limitations on British lawmakers, particularly regarding immigration policy, lawmaker accountability, domestic use of tax money, and international influence. However, as the referendum looms large over the economic and political identity of the 23-year-old union, there’s one aspect of Brexit that its supporters have been far too keen to dismiss: the price tag. While Brexit supporters have legitimate grievances with the EU and its governance, they cannot brush aside Brexit’s enormous economic costs.

In many ways, Brexit comes as a bit of a shocker. By most accounts, Britain’s partnership with the EU has been positive in economic and political terms. But as a wave of isolationism crashes through Europe, England’s been caught in the riptide. In particular, the deeply conservative UK Independence Party (UKIP), led by Nigel Farage, has tapped into xenophobia and frustration among a sizeable segment of the British population. Farage, one of the strongest voices for Brexit, has argued that it is necessary for Britain to gain “our democracy back…control of our borders…[and the ability to] negotiate our own deals on the world stage.” To mollify the growing number of Brexit supporters, Prime Minister David Cameron’s middle-right Conservative Party made a commitment to put the issue to voters through a referendum this summer.

Politics aside, the economic consensus on Brexit’s impact is clear: It’s a bad idea. Efforts to quantify the economic impacts of EU membership are notoriously difficult, but experts think that British membership may constitute 4-5 percent of annual GDP. If England were to leave the EU, 70 percent of leading British businesses anticipate “some or significant damage to their business” and UBS predicts the pound will fall equal to the euro from around its current €1.30. The Bank of England estimates that, following Brexit, GDP could increase by a maximum of 1.6 percent or decrease by a maximum of 9.5 percent — odds that aren’t exactly comforting. Among economists, then, the idea of Brexit is about as terrifying as can be; markets look ready to shudder the moment Britain leaves.

Brexit would also sacrifice the EU’s strength, size, and influence in negotiating beneficial trade agreements with other nations.

In light of these economic realities, proponents of Brexit have launched a number of specious claims about separation and economic growth. Most often, Brexit supporters claim that the EU’s regulatory barriers and the slow politics limit British businesses. For example, David Bannerman, a member of the EU Parliament and vocal supporter of Brexit, argues that “once we have secured this access to the Single [EU] Market…we’d be free to remove the suffocating red tape that has seen the EU plunge in world competitiveness.” Those arguments are based on the assumption that Britain could forge new free trade agreements with the EU, leaving British companies able to trade freely with the remaining EU members as before — just without uncompetitive rules.

However, creating better trade deals with the EU is a lofty notion. Regardless of Britain’s EU membership, British companies will still need to pass EU regulations to export to EU countries. An unburdened Britain looks just like an EU member, only without voting power. As Sam Bowman of the Adam Smith Institute explains, “At best [Britain] can hope for a situation where only British exporters (and their suppliers) are bound by EU rules; at worst, one where we end up with exactly the same set of rules, only now without any say in how those rules are made.” Further, the assumption that a trade agreement with the EU would quickly emerge following the separation is naïve. Regaining access to Britain’s current trade relationships, which today include 53 such deals and the potential for more with China and India, would take time and resources — not to mention political goodwill, which may not be forthright after such a strong rebuke of EU policy.

Brexit would also sacrifice the EU’s strength, size, and influence in negotiating beneficial trade agreements with other nations. Supporters of Brexit say Britain would be more maneuverable and responsive in negotiations than the EU. Even still, Britain’s loss of negotiating power would be detrimental, especially since adverse economic conditions have undercut global support for free trade. Globally, growth is slow, and emerging markets responsible for so much recent dynamism are now turning inward. Consider a recent European Parliament study that chastised the G-20 for failing to respect its commitments to reduce protectionism. Specifically, “the BRICS countries [Brazil, Russia, India, China and South Africa]…[introduced] the highest number of new trade-restrictions in the last year.” And even the EU, for all of its progressive aspirations, has upped the ante on tariffs, most recently imposing 13 percent penalties on Chinese steel. If Brexit supporters want Britain to forge new and fruitful trade partnerships, it’s not exactly clear how the country could do so.

The conclusion is obvious: Better trade is a long shot and in the current global political and economic environment, Brexit cannot offer the economic upside its supporters claim. Proponents of an exit may still think that other issues are more important, but British voters should be clear about the tradeoff between economics and sovereignty. Independence has never been free, of course. Still, like teenagers all too ready to move out of their parents’ house, Brexit supporters clearly have not taken stock of just how expensive independence might be.

Art by Roland High

In 2014, the events leading up to and following the referendum on Scottish independence dominated news coverage around the world. The idea of an independent Scotland was particularly intriguing as many international observers saw the UK as a cohesive unit. A Scottish split would have not only changed the nation’s identity, but also transformed global structures ranging from the United Nations Security Council to the Olympics. Although the Scottish referendum narrowly kept Britain intact, the 2015 General Election saw the Scottish National Party, which led the independence push, dominate Scottish politics. The aftermath of the Scottish referendum clearly indicated that the question of independence is only temporarily settled; it remains both actively and subconsciously present in many of Britain’s leading policy issues today.

Now, an international spotlight once again shines on the British public’s opinion. As long as the UK has been a part of the European Union, there has been a debate over whether this membership is beneficial or detrimental to the national interest.   From its geographic isolation to abstaining from the adoption of the Euro, Britain has never been wholly invested in the EU, and now Brits are wondering if the benefits of membership are truly worth it. In response to the growth of the anti-EU UK Independence Party and anti-EU forces in his own party, Conservative Prime Minister David Cameron vowed during the 2015 election that he would hold a referendum on the UK’s membership in the EU by 2017. That timetable has since moved forward, with the referendum, nicknamed Brexit, scheduled for June 23. The upcoming EU referendum and the recent Scottish referendum appear to be parallel narratives that have jointly dominated recent British identity politics. While these two votes are, on paper, independent, they are in reality intricately interlaced. This relationship provides insight into the challenge of British unity and the understated importance of Scotland in the upcoming referendum.

David Cameron spent most of last week in Brussels frantically attempting to secure his extensive “wish list” of proposed reforms to the terms of the British EU membership. As of February 19, these efforts appear to have translated into a formal deal between the two parties, and a series of changes, which constitute a significant portion of Cameron’s wish list, have been confirmed. The deal contains major reforms on immigration policy, economic policy, and the structure the EU and UK’s political relationship. For example, Britain now has the right to exclude non-EU nationals who have married EU citizens from freely entering the country as well as bar parties suspected of being security risks regardless of whether they have been convicted of a prior crime. Fiscally, Cameron has long pushed for protection of British economic interests in the EU and has sought rules to ensure that banks and investment firms in London will not be burdened by the use of an alternative currency — a reality for only 9 of the 28 EU member states. These policies, as well as a specific effort to avoid the “political integration” of the UK into the EU, reflect the overarching sentiment of the Conservatives, who are eager to prevent future infringement upon national sovereignty.

Unsurprisingly, Cameron’s demands have been met with significant push back from within the Union. The EU has voiced a legitimate concern that granting Cameron his desired reforms would prompt future efforts by other countries to produce their own list of demands. “Eastern European nations, from which huge numbers of workers in Britain have come, are wary of welfare restrictions, fearing the new rules could give their citizens second-class status. France is worried that the proposals related to the financial industry might give British companies an unfair economic advantage. And Belgium is unhappy about a British effort to pull back from an ‘ever closer union,’ fearing it may weaken the bloc’s ambitions,” according to Stephen Castle. In fact, Belgium and France have been at the forefront of the opposition to Cameron’s adamant efforts, voicing a “Brexit warning” that any decision made by the referendum will be binding and irrevocable in the final rounds of negotiations.

The greatest danger that the UK faces in the coming months is not a hostile France or Belgium, but rather a close-minded, ultimatum-like approach to reform and a failure to understand — or perhaps care — about the long-term implications of the referendum.

However, the fundamental problem with Cameron’s wish list, no matter the international pushback or outcome, is that it has solidified the domestic divide among the British people and brought one of the nation’s most polarizing policies to the forefront of debate. In last May’s elections, the Scottish National Party won 56 of 59 Scottish seats in the House of Commons, with the Conservatives, Liberal Democrats and Labour winning one each. This means that although the Conservatives have a majority in the House of Commons, they lack a mandate in Scotland. And while Prime Minister David Cameron has campaigned on a platform of moderate reform, many of his more conservative counterparts have been driving the Brexit campaign with their full political might. The mayor of London, Boris Johnson, who is expected to make a bid to replace Cameron, framed the Brexit campaign as an unfortunate, but necessary step to maintain British sovereignty, rejecting the “supranational element” at the core of the Union. While the majority of the country does not match his level of conviction, the Brexit campaign still poses a risk to British unity for the simple reason that the Scottish population neither supports the Conservatives nor shares their opinions on EU membership. As a result, there is a very real possibility that Brexit may lead to “Scexit.”

Speculation of this causal relationship — formerly more of a behind the scenes discussion with relatively little political or public focus — has recently escalated. Nicola Sturgeon, First Minister of Scotland and head of the Scottish National Party, announced that if Britain left the EU, Scotland would “almost certainly” call for a second vote of its own. The relationship between Brexit and the Scottish referendum is far from clear-cut, but the intersection of the two will assuredly alter Britain’s identity internally and externally. And yet, despite clear concerns in Scotland with the prospect of Brexit, Cameron repeatedly stated that he “will be battling for Britain,” and that “with goodwill, with hard work, we can get a better deal for Britain.”  Now, a deal has been confirmed and a date for the referendum is set. But these assurances — and perhaps the success in following through on many of them — convey the problem with the EU reform and referendum efforts in the first place. The Britain that Cameron claims to represent drastically differs from the Britain that Scotland sees and envisions for the future. Whether voiced through the 2015 general election that placed the Scottish National Party  in nearly every Scottish seat, or current polls that reveal resounding Scottish pro-EU sentiment, Scottish and British identity appear for the first time to be truly separate entities. There could not be a more fitting analogy for the current dynamics between the UK and Scotland than the UK-EU relationship itself. According to the Conservatives, the UK has always been treated as an outsider in the EU; membership has sometimes benefitted Britain and has sometimes had minimal to no impact, but overall, it has not led to mutual exchange and benefit. For many Scots, namely the National Party, these sentiments also narrate the relationship between Scotland and the UK. While one cannot deny many of the economic and political advantages of Britain, it seems like major political decisions divide the two parties far more often than they unite them.

However, despite the plethora of important political conflicts between the current government and the Scottish people, the most dangerous aspect of the EU referendum may actually be the ambiguous and ambivalent attitudes that many have toward the vote. Even without the Scottish implications, the ramifications of the referendum are understood to be widespread; the vote will no doubt have remarkable political, economic, and cultural consequences for the nation. Yet, much of the public appears to be undecided or expressive of “soft euroscepticism,” a broad hesitancy to establish closer ties with the EU. In other words, the strength of people’s convictions does not reflect the strength of the implications. Amid this general lack of conviction, the opinions of the Scottish population appear further isolated. Brexit is a Conservative creation and Scotland is decidedly not. Brexit could become a reality, despite the united front Scotland presents, if the Conservatives succeed in convincing the relatively unenthusiastic population — primarily the English portion that they represent — that it is in their interest to leave the Union. Thus, the UK could depart from the EU predominantly on the will of the English, leaving Scotland out to dry. In the end, the mildly interested majority, in its attempt to secure what it considers best for Britain, may inadvertently lead to its failure.

Fears of ‘Grexit’ has yet to wane, but the press is talking about another country’s possible retreat from the EU—Britain. The Economist claims that ‘Brexit’ has become “increasingly possible;” a columnist at Reuters even warns, “Brexit could come before Grexit.”

A similar scenario is unfolding in England. They say blood is thicker than water; as in Greece back in May, politicians in Britain are refusing to adhere to the dictates of Brussels, especially when they conflict with national priorities. David Cameron had hoped to negotiate a freeze on the 2014-2020 budget, but Euroskeptic parties in the House of Commons voted against his plan, calling for a reduction. They refused to chip in more to the EU budget while slashing their own bills.

This is not a big surprise, as Britain has been the ‘bystander’ of the continental tradition; it only joined the Community in 1973. As the Eurozone jumps into deeper economic and political union, Britain is once again having trouble deciding where to stand.

This short post considers the major benefits of Brexit, and points out that the fruits of exiting are not as large as they initially seem. True, an exit might occur out of a political mishap; a ‘yes’ vote on the national referendum would quickly take the country out of the block. But politicians, if they are indeed rational, would not hit the button.

The ‘Pro’s

  • Britain could gain £8 billion ($13 billion) a year, the Economist claims, in net budget contributions; the UK annual budget is roughly around £690 billion. (Click here to see the net contributions by each member state in 2010)
  • Its financial hub would be freed from various financial regulations that will be implemented to stem future crises, not to mention the financial-transaction tax that might be introduced to expand the small EU budget.

The ‘But’s

  • The Single Market now accounts for half of Britain’s exports. If Britain exits, it would no longer be able to enjoy the Single Market’s free movement of goods, capital, services and people, and pay higher tariffs.
  • Britain would also have to go through the burden of re-negotiating bilateral trade deals with each of the twenty-six member states.
  • The country’s capital also benefits significantly as the hub of euro-denominated transactions; would it be able to retain the position if it no longer belonged to the Single Market?

Perhaps this is simply Britain’s way of negotiating with the continental members. But will it work? Europe has a lot more to lose with Brexit than it does with Grexit. A Greek exit from the euro would raise the risk of a full eurozone collapse. Panic would ensue as depositors start a run on banks in other Mediterranean countries.  The risk would be too high. EU members have strong incentive to prevent Greece from leaving. But what high stake does Britain’s exit have for the EU?

Moreover, there is no exit clause in the EU Treaty, making it hard to envision what it would look like. Last year, British businessman Simon Wolfson and a London-based think tank, Policy Exchange even launched the Wolfson Economics Prize that offered a reward of £250,000 for an individual who comes up with the safest plan for how the euro could be dismantled. A winner was announced. “People may disagree on whether leaving the Euro is a good thing,” the winner Roger Bootle at Capital Economics said, “but the contribution of the Wolfson Prize has been to demonstrate that it can be done.”

But so long as everyone continues to play the game, there is simply too much to lose. Even if the Euroskeptics refuse to admit it, the centrifugal force pulling their country closer into the EU is getting more and more powerful.