In Britain, the people have spoken, and Brexit will mean Brexit. But if the UK wants talks on its withdrawal from the EU to work well, it needs to ensure that it asks itself what is good for Europe as well as what is good for Britain.
A good negotiation starts with an intelligent appreciation of the interests of the people on the other side of the table. If Britain is concerned only with its own interests, the talks will fail. The UK government needs to think: what are our economic and social priorities? And how can these be made compatible with those of the rest of the EU?
The trouble is that it is not yet totally clear what Britons want. Many voted Leave because they wanted more protection from global competition. But many of the campaign’s leaders favour the opposite: a deregulated economy, fewer social rights, more global competition.
So Britain must choose which of these contradictory economic approaches it wants, because only when it has done so can it decide what sort of relationship it wants with the EU. That choice will determine what the UK says in its Article 50 letter, to be prepared by the end of March 2017.
And the UK must use the next six months to prepare its letter and negotiations well: short-term uncertainty is a very small price to pay for avoiding a botched or ill-prepared exit negotiation.
When the moment comes to trigger Article 50, I believe that there will be two negotiations: one on withdrawal, and one on the framework of a future UK-EU relationship. The two must run in parallel.
The other 27 EU leaders rightly insist that the EU’s four freedoms of movement – of people, goods, capital and services – go together. Nobody has any idea yet how the UK will propose to get around that.
Clearly, the most sensitive freedom is that of free movement of people. But immigration as political issue in the UK will decline, irrespective of immigration controls, if the UK becomes less wealthy. A fall in the purchasing power of sterling and a slowdown caused by the unravelling of the UK’s balance of payments deficit automatically make the UK a less attractive destination for migrants.
Trade is another key topic. Until its withdrawal is finalised, the UK will still be a member of the EU, bound by EU rules and a participant in all key EU decisions (except those concerning its own exit terms).
The UK cannot do trade deals with other countries while it is still in the EU. It cannot even enter into commitments about future deals, particularly ones that may undercut EU negotiating positions. Instead, the UK must, under Article 4 of the Treaty, act in ‘sincere cooperation’ with its EU partners.
But Britain’s current EU partners must also heed the lessons of the Brexit vote. The old ways of doing EU business do not inspire the loyalty of enough EU citizens. The EU needs to improve its performance on at least three topics – trade, treaty change and democracy.
If trade becomes too difficult for the EU to complete trade agreements because a few states hold things up then the EU’s utility as a trade negotiator will fade away. We should not forget that many who favoured Brexit argued that the UK could negotiate trade deals more easily outside the EU, without having to wait for 27 other countries to agree.
Treaty change must also be easier. Every living institution must be able to amend its rules. If EU treaty change is off the agenda as a matter of principle then the EU will eventually freeze up and die. If such change becomes impossible, European states will look to other, less open, less democratic and less transparent institutions to advance their collective interests.
Democracy must also be enhanced. One of the most frequent – if ill-informed – criticisms of the EU heard during the UK referendum was that the EU was ‘undemocratic’ and run by ‘unelected bureaucrats’. The best way to respond would be to make the treaty changes that enable the EU to be more democratic and accountable.
If they are to have greater allegiance to the EU, citizens must feel they can, by the way they vote, influence the direction of the EU policy. And they should be able to do that, collectively as Europeans, rather than just as citizens of member states.
So what does this mean concretely? I suggest three ideas.
First, the entire electorate of the EU should elect the President of the European Commission directly, in a two-round election. This should be done without changing the legal powers or composition of the Commission. The direct election of its President would help to increase the moral authority of the Commission.
Second, the President of the Eurogroup should be similarly elected. This would introduce a valuable democratic element into debates about economic policy, without threatening the independence of the European Central Bank.
Third, give national parliaments, if a minimum number agree, a power to require the Commission to put forward legislative proposals. Any proposal would then have to go through normal procedures after that, but such a move would give a positive dimension to national parliaments’ discussions on the EU.
Uncertainty will continue. There has been disruption to the system. Disorder and division are the consequences.
To overcome these consequences, both Britain and Europe need to learn the right lessons from the referendum. Britain will have its Brexit, and the UK government promises to make a success of it. Its government will need cool heads and an understanding of Europe’s position.
For the rest of the EU, it is time to turn this crisis into an opportunity – to grasp the chance to renew the Union and make changes for the better.
IMAGE CREDIT: © European Union