Brexit: Britain and the European Union

On June 23rd, 2016, Brits voted in a referendum to determine whether the UK should remain in the European Union (Union) or leave the Union and go it alone (Wheeler and Hunt). The voting resulted in 52% of the voters preferring that Britain leave the Union, while 48% preferred remaining within the European Union. The England voting breakdown was 53.4% to 46.6% with the majority voting to leave, Whales voted 52.5% to 47.5% with the majority also voting to leave, conversely, Scotland voted 62% to 38% to remain, and Northern Ireland 55.8% to 44.2% to remain in the Union. Those disappointed with the referendum results immediately sought a re-vote, but the likelihood of such an event has limited plausibility (Brock, Witte and Horn). British Prime Minister David Cameron (PM), leader of the conservative party, who served as PM since 2010, and a member of Parliament since 2001, resigned from his post after the vote (Brock, Witte and Horn).

The European Union: Background

The idea of the European Union arose as a result of the debris from World War II ("What is the EU”). Five years after the war, France and Germany developed a plan to ensure that they would never engage in war again. In 1950, the agreement set the foundation for the two countries, in addition to Belgium, Italy, Luxembourg, and the Netherlands, to combine their steel and coal supplies. In 1957, the European Economic Community (EEC) treaty was signed, a precursor to the current European Union. The UK joined the European Economic Community in 1973, when Denmark and Ireland also joined the organization. After a number of other countries joined, the EEC became the European Union in 1993 ("What is the EU”).

What is the European Union?

The European Union is composed of four institutions, which in combination, run the organization ("What is the EU”). The institutions are the European Commission, the European Parliament, The Council of the European Union, and the European Court of Justice. The European Commission functions as the civil service component of the Union and resides in Brussels. The Commission is composed of 28 commissioners, one commissioner from each of the 28 member countries. The Commission handles the money spent by the Union and is where new laws are developed.  The European Parliament (Parliament), also located in Brussels, has 751 MEPs or Members of European Parliament from various countries. MEPs are divided into seven political groups and fifteen non-inscrits, individuals who are not attached to any groups ("What is the EU”). The political grouping include: the European People's Party (two hundred sixteen), the Progressive Alliance of Socialists and Democrats (one hundred ninety), the European Conservatives and Reformists (seventy three), the Alliance of Liberals and Democrats for Europe (seventy), the European United Left–Nordic Green Left (fifty two), the European Greens–European Free Alliance (fifty), the Europe of Freedom and Direct Democracy (fourty six), the Europe of Nations and Freedom (thirty nine), and the Non-Inscrits (fifteen) ("Political Groups"). The Parliament votes on most of the laws developed by the Commission. The Council of the European Union (Council), also located in Brussels, is where the Member State governments give their input and help to provide political direction to the Union ("What is the EU”). The Council generally strikes deals to achieve its goals through the process of compromise. The European Court of Justice, located in Luxembourg, is the component that ensures that the Union’s rules are complied with, laws are followed, and inter-Union disagreements, between the commission, parliament and the council are resolved ("What is the EU”). 

So What Does the UK Have to Do Now?

There are at minimum two points of view about Britain, now that it has effectively, voted to defect the European Union ("The European Union has Agreed”). There are those who say, good riddance, let’s get this done, like France and Belgium, and there are those who are on the side of patience, like Germany and the Netherlands. Yet the Union has come to an accord on two concepts, how to deal with Britain prior to its departure, and the type of trade agreement it may propose for the post-separation period. Prior to departing, the Union is insisting that Britain must notify first and negotiate later. Article 50 is the procedure created for any country to leave the Union. No negotiations will be held until they have Article 50 in hand. This will squash the desires of some politician who hope to have informal discussions prior to formally defecting. Article 50 was ratified as the formal mechanism for countries wanting to exit the Union. It was added to the Lisbon Treaty in 2009. The procedure makes the negotiation process more difficult for the Member State that is leaving. Once Article 50 is implemented, the country has only a two year period to negotiate an exit agreement, unless all countries agree to an extension of time. Since Prime Minister Cameron is departing, the Union will wait for the new political party to get established, but additional delays will be frowned upon ("The European Union has Agreed”). European Union officials have come to an agreement that a Brexit deal post exit can occur simultaneously with the divorce. Perhaps naively over-confident, the Brits are hoping for a deal that allows them to trade with the Union’s single market with no reciprocal freedom of travel and movement requirement. Opponents find this prospect humorous, and the likelihood of this possibility is about as probable as it was when Cameron attempted to hammer out an agreement previously. Freedom of movement is the essence of the Union, the European Council president said, without this freedom the purpose of the Union does not exit ("The European Union has Agreed”).

Many onlookers do not believe that Brexit will actually ultimately occur ("The European Union has Agreed”). Angela Merkel, the Chancellor of Germany, suspects that the reality of a Brexit will cause clearer minds in Westminster to prevail. Norbert Röttgen, a deputy in the Christian Democratic Union party of Germany, thinks that Britain should be allowed to sit with their concerns over the future. Interesting is the fact that no one is rushing to haggle with them to keep them in the circle.

Brexit: The Issues Requiring Consideration

Membership Fees and Trade. The UK has pondered the benefits of remaining in the European Union or venturing out on a limb alone ("EU Referendum: What”). The country’s quandary was finally settled by referendum. So what issues brought them to this point? The Union’s membership fee is an issue, Britain paid a £13bn membership fee which contributes to the organization’s budget (Lee). What is not clear to the Britons is whether membership benefits outweigh the fees expended. Another issue is trade. The European Union is a single market and Member States do not have to pay tariffs on imports or exports, also membership ensures that the country has a say regarding the rules. Further, when the European Union strikes deals with other powers, like the U. S., inclusion helps British business (Lee). If Brexit takes place, the country can negotiate on its own, but loses the power behind being part of a big group. Some British leaders believe that the UK can go the way of Norway, which enjoys single market access, but does not participate in other Union laws. Others sense that if Britain gets a divorce from the European Union they would become a scapegoat with really bad terms, to discourage other members from leaving the Union in the future. Even France warned, that there would be “consequences” ("EU Referendum: What”). Also, if the UK emulated the Norway strategy, the country would not be in a position to influence the development of rules and would have no control over future determinations. Skeptics say most smaller businesses do not do business with the European Union, but they are entrapped by the burden of many of its regulatory requirements. Others, like Open Europe, a think-tank, believe that Britain would benefit tremendously from retaining their current trade deal, while deregulating the ugly aspects ("EU Referendum: What”).

Investment. In addition to membership fees and trade matters, there are also investment considerations on both sides of the issue ("EU Referendum: What”). Incoming investments would likely slow as the vote approached and possibly in response to the vote, similar to what took place with Scottish independence referendum. Those that support the Union posit that Britain’s status as a global financial hub would be greatly reduced once it was no longer viewed as entrée into the European Union. Brexits believe that with the elimination of Union controls, the UK could become the new Singapore to the world. Car manufacturers currently in the UK might slow production or move if vehicles would subsequently become victim of export taxes. Fueling these fears were comments made by BMW to its UK employees at the Rolls-Royce and Mini facilities about the particular benefits of Union membership. Also, tax revenues could be fall if big banks decided to move their headquarters elsewhere in the European Union. Barclays, issuing a doomsday claim, said that the departure of the UK, a major player in the Union, could spark copy cat actions in other Member States and mark the downfall of the European Union altogether. Ultimately, though, this would be a benefit to the country which would be a safe haven, with a likely increase in investments ("EU Referendum: What”).

Sovereignty, Regulations, Immigration and Security. Sovereignty is another issue requiring consideration (Lee). European Union treaties have diverted the decision making power from the individual Member States, like the UK, to the central Union in Brussels. The Union’s regulations overshadow national rules and laws, on agriculture, competition and copyright and patent law and the commissioners are not thereafter accountable to Britain – they are just stuck. Many complain about the European Union’s regulatory structure, which is viewed as quite onerous, and complain, arguably, that it often costs Britain $880 million per week or more. Immigration is a big emotional issue because one of the requirements of the European Union is that people must be free to travel, move in and take jobs within the Union (Lee). As a result of the struggles of a number of other countries, people are flocking to the UK in search of work. This effects the job market for Brits, it effects the cost of additional scarce services that must be provided for those who immigrate, and it disproportionately lowers the wages of those native to the population. Generally, everyone in Britain wants a better immigration system, one that allow immigration from those who could bring valuable skills into the country, who already speak English, and have an education. In addition, the open door policy allows terrorist free entry into the country since there is no border control. The perspective on security is split. One side believes that preventing terrorist from entering the country helps to control the tragic consequences associated with an unrestricted border, while other say that being a part of the Union allows for the sharing of criminal records; strengthens relationships while creating allies; encourages support, and creates bi-lateral relationships regarding anti-terrorism efforts (Lee).

Britain has a lot to consider as it attempt to make strides to advance to the next level. The only thing that is clear is that their future is a bit foggy.

Works Cited

Brock, Sam, Witte, Rachel and Horn, Michael. "Brexit Re-Vote Unlikely." NBC Bay Area. NBC Universal Media, LLC. 30 June 2016. Web. 1 July 2016. <http://www.nbcbayarea.com/news/california/Brexit-Re-Vote-Unlikely-385118101.html>.

"EU referendum: What are the pros and cons of Brexit?" The Week. The Week Ltd which is a subsidiary of Dennis Publishing Limited. 27 June 2016. Web. 1 July 2016. <http://www.theweek.co.uk/brexit-0>.

Lee, Timothy. "Brexit: the 7 most important arguments for Britain to leave the EU." Vox. Vox Media. 25 June 2016. Web. 1 July 2016. <http://www.vox.com/2016/6/22/11992106/brexit-arguments>.

"Political Groups." European Parliament MEPs. n. d. Web. 1 July 2016. <http://www.europarl.europa.eu/meps/en/search.html>.

"The European Union has agreed on two important questions regarding Brexit." The Economist. The Economist Newspaper Limited. 29 June 2016. Web. 1 July 2016. <http://www.economist.com/news/europe/21701448-many-brussels-still-hope-article-50-will-be-delayed-indefinitely-european-union>.

"What is the EU and how does it work?" " BBC News. BBC. n. d. Web. 1 July 2016. <http://www.bbc.co.uk/guides/zgjwtyc>.

Wheeler, Brian and Hunt, Alex. "The UK's EU referendum: All you need to know." BBC News. BBC. 24 June 2016. Web. 1 July 2016. <http://www.bbc.com/news/uk-politics-32810887>.