Britain Faces a Brave New World After Brexit

The UK's Conservative government is weak, the Labor Party is rising, and EU members are out for blood.
Conn Hallinan
October 31, 2017
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As the clock ticks down on Britain’s exit from the European Union, one could not go far wrong casting British Labor Party leader Jeremy Corbyn as the hopeful Miranda in Shakespeare’s Tempest: “How beauteous mankind is! O brave new world that has such people in’t.”

And Conservative Party Prime Minister Theresa May as Lady Macbeth: “Out damned spot, out, I say!”

With the French sharpening their knives, the Tories in disarray, the Irish demanding answers, and a scant 17 months to go before Brexit kicks in, the whole matter is making for some pretty good theater. The difficulty is distinguishing between tragedy and farce.

The Conservative’s Party’s Oct. 1-4 conference in Manchester was certainly low comedy.

The meeting hall was half empty, May’s signature address was torpedoed by a coughing fit, and a prankster who handed her a layoff notice. Then the Tories’ vapid slogan “Building a country that works for everyone” fell on to the stage. And several of May’s cabinet members were openly jockeying to replace her.

In contrast, the Labor Party’s conference at Brighton a week earlier was jam-packed with young activists busily writing position papers, and Corbyn gave a rousing speech that called for rolling back austerity measures, raising taxes on the wealthy, and investing in education, health care, and technology.

Looming over all of this is March 2019, the date by which the complex issues involving Britain’s divorce from the EU need to be resolved. The actual timeline is even shorter, since it will take at least six months for the European parliament and the EU’s 28 members to ratify any agreement.

Keeping all those ducks in a row is going to take considerable skill, something May and the Conservatives have shown not a whit of.

A Messy Divorce

The key questions to be resolved revolve around people and money, of which the first is the stickiest.

Members of the EU have the right to travel and work anywhere within the countries that make up the trade alliance. They also have access to health and welfare benefits, although there are some restrictions on these. Millions of non-British EU citizens currently reside in the United Kingdom. What happens to those people when Brexit kicks in? And what about the 2 million British that live in other EU countries?

Controlling immigration was a major argument for those supporting an exit from the EU, though its role has been over-estimated. Many Brexit voters simply wanted to register their outrage with the mainstream parties — Labor and Tories alike — that had, to one extent or another, backed policies which favored the wealthy and increased economic inequality. In part, the EU was designed to lower labor costs in order to increase exports.

Indeed, German Chancellor Helmut Kohl (1982 to 1998) pressed the EU to admit Central and Eastern Europe countries precisely because they would provide a pool of cheap labor that could be used to weaken unions throughout the trade bloc. In this he was strongly supported by the British. Union membership in Britain has declined from over 13 million in 1979 to just over 6 million today.

The Conservatives want to impede immigration while also having full access to the trade bloc, what has been termed the “have your cake and eat it too” strategy. So far that approach has been a non-starter with the rest of the EU. Polls show that only 30 percent of EU members think that that Britain should be offered a favorable deal. This drops to 19 percent in France.

The Conservatives themselves are split on what they want. One faction is pressing for a “hard Brexit” that rigidly controls immigration, abandons the single market and customs union, and rejects any role for the European Court of Justice.

A rival “soft Brexit” faction would accept EU regulations and the Court of Justice, because they are afraid that bailing out of the single market will damage the British economy. Given that countries like Japan, China, and the U.S. seem reluctant to cut independent trade deals with the UK, that is probably an accurate assessment.

While the Tories are beating up on one another, the Labor Party has distanced itself from the issue, quietly supporting a “soft” exit, but mainly talking about the issues that motivated many of the Brexit voters in the first place: the housing crisis, health care, the rising cost of education, and growing inequality. That platform worked in the June 2017 snap election that saw the Conservatives lose their parliamentary majority and Labor pick up 32 seats.

Divorces are not only messy, they’re expensive.

This past September, May offered to pay the EU 20 billion euros to disentangle Britain from the bloc, but EU members are demanding at least 60 billion — some want up to 100 billion — and refuse to talk about Britain’s access to the trade bloc until that issue is resolved. All talk of “cake” has vanished.

Troubles on the Border

And then there is Ireland.

The island is hardly a major player in the EU — the Republic’s GDP is 15th in the big bloc. But it shares a border with Northern Ireland. Even though the North voted to remain in the EU, as part of the UK it will have to leave when Britain does. What happens with its border is no small matter, in part because it is not a natural one.

Those counties that were a majority Protestant in 1921 became part of Ulster, while Catholic majority counties remained in the southern Republic. During the “Troubles” from the late 1960s to the late 1990s, the border was heavily militarized and guarded by thousands of British troops. No one — north or south — wants walls and watch towers again.

But trade between the Republic and Ulster will have to be monitored to ensure that taxes are paid, environmental laws are followed, and all of the myriad of EU rules are adhered to.

Other than trade, there is the matter of the 1998 Good Friday Agreement that ended the fighting between Catholics and Protestants. While laying out a way to settle the differences between the two communities through power sharing, it also re-defined the nature of sovereignty. Essentially the Irish Republic and Britain agreed that neither country had a claim on Ulster, and that Northern Irish residents be accepted as “Irish, or British or both, as they may so choose”

Such fluid definition of sovereignty is threatened by the Brexit, and most of all by the fact that May and the Conservatives — at the price of a 2 billion euro bribe — have aligned themselveswith the extremely right wing and sectarian Protestant party, the Democratic Unionist Party, in order to pass legislation. While the pact between the two is not a formal alliance, it nonetheless undermines the notion that the British government is a “neutral and honest broker” in Northern Ireland.

May didn’t even mention the Irish border issue in her September talk, although the EU has made it clear that the subject must be resolved.

“That Day Is Finally Upon Us”

Talks between Britain and the EU are barely inching along, partly because the Conservatives are deeply divided, partly because the EU isn’t sure May can deliver or that the current government will last to the next general elections in 2022. With Labor on the ascendency, May reliant on an extremist party to stay in power, and countries like France licking their chops at the prospect of poaching the financial institutions that currently work out of London, EU members are in no rush to settle things. May is playing a weak hand and Brussels knows it.

Eventually, the Labor Party will have to engage with Brexit more than it has, but Corbyn is probably correct in his estimate that the major specter haunting Europe today isn’t Britain’s exit, but anger at growing inequality, increasing job insecurity, a housing crisis, and EU strictures that have turned economic strategy over to unelected bureaucrats and banks.

“The neoliberal agenda of the last four decades may have been good for the 1 percent,” says Nobel Laureate Joseph Stiglitz, “but not for the rest.” Those policies were bound to have “political consequences,” he says, and “that day is finally upon us.”

[Foreign Policy In Focus columnist Conn Hallinan can be read at dispatchesfromtheedgeblog.wordpress.com and middleempireseries.wordpress.com.]

Thanks to the author for sending this to Portside.

November 2, 2017