State of the European Union

Two years after the British people narrowly voted for a “Brexit” referendum to withdraw the United Kingdom from the European Union, the EU is more threatened than ever.  Trade and customs negotiations between the British government and the European Union are at a standstill, nationalist parties blame the EU’s open border policy for enabling the passage of Syrian and and African refugees into Europe, and support for pan-European internationalism appears to be in decline.  Political pressure from emboldened Eurosceptics like former London Mayor Boris Johnson and ardent Europeanists like French President Emmanuel Macron complicates the already fraught negotiations between the EU and UK.  How these negotiations unfold may well determine whether or not the European system endures or succumbs to nationalist revolts in its member states.

At 11 PM on March 29, 2019, the United Kingdom is scheduled to exit the European Union.  In the event of a “No-Deal” Brexit – that is, an exit without any trade or customs agreements with the European Union – the UK will be left without a legal framework for trade or border controls with the EU.  In the short term, the result would be absolute pandemonium.

At present, EU-UK negotiations are deadlocked.  Despite UK Prime Minister Theresa May’s insistence that a deal on border controls and other contentious issues such as aviation rules and fishing rights is still possible, disagreements persist without a resolution in sight.   More critically, however, is the potential for a hard border between Northern Ireland and the Republic of Ireland.  

The Good Friday Agreement of 1998, which concluded the Troubles – decades of sectarian violence between Irish supporters of the United Kingdom and those desiring an independent Irish state – established a ceasefire between Irish Republican guerillas and the United Kingdom. The division between British-governed Northern Ireland and its southern neighbor, the Republic of Ireland remained. As a compromise, citizens of Northern Ireland were given the option of being both Irish and British citizens, and the border between the two Irish states was softened to allow greater freedom of movement.

In 2016, Northern Ireland, still a part of the United Kingdom, overwhelmingly opposed the Brexit referendum and voted to remain in the European Union, but was outvoted by the rest of the UK.  If the UK is unable to reach an agreement with the EU that includes free movement of citizens (akin to the existing Schengen Area), a political crisis may result.  A hard border between a non-EU Northern Ireland and the Republic of Ireland, still an EU member state, could undo the fragile peace and inflame Irish nationalist and unionist passions.    

While talks between the British government and the European Union stall, internal political pressure from hard-line Brexiteers like Boris Johnson, who demand a more complete withdrawal than even Prime Minister May is proposing, threatens the likelihood of a deal.  Johnson and other proponents of total disengagement from European institutions are fomenting an internal revolt within the UK’s Conservative Party, claiming that Prime Minister May’s “Chequers Plan” preserves unacceptably close ties with the EU and fails to “take back control” from European customs and trade regulatory agencies.  Johnson resigned his cabinet post in July in protest of the Chequers Plan, sending May’s government into a tailspin and renewing concerns about the feasibility of a Brexit deal.  Any agreement reached between May’s government and the EU will likely be seen as too moderate by Johnson and other strict Brexiteers, but the EU is unlikely to accept a “Hard Brexit” akin to what Johnson proposes.

To further complicate matters, French President Emmanuel Macron has taken a noticeably tougher stance on the UK’s withdrawal from the EU, labeling Brexit proponents “liars” and rejecting May’s insistence that the EU accept the Chequers Plan as a framework for ongoing negotiations.  For Macron, this hard-line stance on Brexit negotiations is not motivated by any pragmatic concern for the fine print of an eventual UK-EU deal, but by an overarching desire to preserve the integrity of the European system.

The European Union is extremely vulnerable, more so than at any previous time since it was founded by the Maastricht Treaty in 1993.  The Greek bailout, in which the EU (mostly Germany and France) were obliged to extend credit to a fiscally-irresponsible and oft-corrupt Greek government, concluded on August 20th of this year, but financial instability in neighboring Italy, whose populist government under the Five Star Movement is violating EU fiscal rules as it increases welfare spending, has experts worried that another sovereign debt crisis is on the horizon.  Nationalist movements are ascendant across Europe; along with the Five Star Movement, Germany’s AfD, France’s National Rally (formerly National Front), and others have capitalized on their constituencies’ opposition to the liberal democratic order, internationalism, and immigration embodied by the European Union.  

Macron’s stance on Brexit should be read as an intentional show of force to impress upon other nations the costs of exiting the European Union.  If the UK were allowed to exit the EU with favorable terms, this would likely embolden other Eurosceptics like France’s own National Rally. If other European nations believed that they could free-ride and keep the benefits of EU membership, such as the tariff-free common market, while avoiding the dues, restrictions, and open-border policy, they would likely follow in the UK’s example.  Macron is thus determined to make the UK’s exit from the European Union difficult either to dissuade continental Eurosceptics in the event of a “Hard Brexit” or to encourage the UK to reverse course in face of the likely costs.

Even though France continues to insist that a Brexit deal is achievable, the French government has begun drawing up contingency plans, pointing to a real fear that no deal will be finalized before the March 2019 deadline.  The French Parliament published a draft bill, which can be quickly passed in the event of a “No-Deal” Brexit, to address issues including work permits and residency visas for British nationals.  According to French minister of European Affairs Nathalie Loiseau, the Eurostar train which connects England and France underneath the English channel might be barred from entering French soil, and British planes could be denied access to French airspace if no Brexit deal is finalized.  

This would be a dramatic departure from the current state of affairs, which is essentially a state of open borders between the UK and continental Europe.  At present, the journey from France to England is a 35 minute train ride under the English Channel, so brief that so-called “Eurocommuters” can live in one country but work in the other.  Next year, that same train may be turned away by armed police at the French border.   

The potential economic costs of Brexit are severe for both the United Kingdom and European Union nations like France.  The Center for European Progress estimates that, even though the UK has not yet officially left the European Union, wary European investors and reduced cross-channel trade have already made a dent in the British economy, to the tune of “€26 billion [$29.49 billion] per annum – or €500 million [$567 million] a week.”  The Center’s study projected that as a result of the passage of the 2016 Brexit referendum, the British economy is 2.5% smaller than it otherwise would have been. When the UK actually exits the EU, the economic repercussions will be even more severe, especially in the event of a “Hard” or “No-Deal” Brexit which results in significant barriers to trade and investment.  The International Monetary Fund projects that a “No-Deal” Brexit would cost the EU around $250 billion, or about 1.5% of the EU’s GDP.      

It is a very real possibility that, in the event of a “No-Deal” withdrawal from the European Union, the United Kingdom will become immediately isolated from the European continent and excluded from the European body politic for the first time in twenty years.  If that comes to pass, continental nationalist parties will no doubt be emboldened, and the European experiment of free trade, free movement, and free people may find itself in mortal danger. At a time when illiberal sentiments such as hyper-nationalism, xenophobia, and distrust of globalism appear to be in vogue, the survival or disintegration of the European Union will likely determine whether or not the liberal international order can endure.

What does all this mean for confused American spectators? Since the end of the Second World War, the U.S has greatly benefited from this liberal order, built on rules-based international organizations, free trade agreements, and, ideally, respect for human rights. In large part, this is because the United States was the de-facto leader of the postwar West, hence the moniker “Leader of the Free World,” and has therefore traditionally held great sway over the United Nations, World Trade Organization, and similar institutions.

Nationalist movements which threaten the European Union are in many ways identical to the post-2016 American Right which calls for immigration restrictions, trade protectionism, and a withdrawal of American support for international institutions like NATO. With the U.S. itching to abdicate these responsibilities, if the European Union falls, so too may the international system upon which American hegemony has rested for the last 70 years.

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