Storm clouds gather - The EU must now decide what it stands for

Brexit is a call for reform. But Brussels is unsure about what that means.

LATE last night (23/06/2016), as the polls closed in Britain, an apocalyptic thunderstorm erupted in Brussels. It was followed this morning by a metaphorical one, as news that Britain’s voters had chosen to leave the European Union filtered through. Brexit follows a cascade of recent crises—Russian aggression, economic woes, terrorism, refugees—that have brought the EU to its knees. It differs from them only in being entirely self-inflicted. That does not make the questions it raises for Europe any less profound.

This morning (24/06/2016) the leaders of four EU institutions issued a statement urging Britain to begin the process of departure “as soon as possible”. A flurry of meetings between various leaders now follows before a full summit of EU heads of government in Brussels next Tuesday and Wednesday, at which David Cameron, Britain’s prime minister, will formally deliver the news to his 27 counterparts. Mr Cameron will then return to face parliament at home, leaving the remaining leaders to stake out a negotiating position in the coming Brexit talks. This will be a taste of what is to come for Mr Cameron’s successor, for under the EU’s rules any member country that withdraws from the club is excluded from political discussions on the terms of its departure.

Britain’s vote presents Europe’s leaders with three tasks. First, to manage the political fallout at home; right-wing populists in France and the Netherlands have wasted no time in calling for their own referendums. Second, to begin the divorce negotiations with Britain. Some hard bargaining lies ahead, not least because Europe’s leaders are keen to demonstrate to other potential waverers that exiting the club carries a heavy price. Brexiteers who expect access to the EU’s single market minus the obligation to accept EU migrants thus face a rude awakening. Wolfgang Schäuble, Germany’s finance minister, said before the referendum that a vote for Brexit would be a vote against the single market. François Hollande, France’s flailing president, will need to demonstrate a tough line on Britain ahead of his re-election bid next year.

But their third job is the hardest: to conjure a vision for the EU equal to the magnitude of the challenges it faces. Even before Britain’s vote there was a distinct smell of “Whither Europe” in the air. Donald Tusk, the president of the European Council, had urged the EU to “depart from Utopian dreams”. Mr Schäuble, a venerable champion of European integration, said there could be no return to “business as usual”. Position papers are already flying around Europe’s capitals.

Everyone can agree that Brexit must be met with reform. But that word masks varying, even contradictory, ideas. To one group, epitomised by the likes of Marine Le Pen and Geert Wilders, it means blowing the EU up and replacing it with a “patriotic spring” of national sovereignty. For others, perhaps the dominant group, it means slowing down the train of Euro-integration, returning powers to national governments and focusing the EU on a limited number of practical projects. A third group, well represented in Brussels, will demand large new steps of integration in areas like the euro zone and the management of migration into Europe. The prime minister of Belgium, one of the EU’s last bastions of federalism, has called for a “conclave” of EU leaders to discuss such proposals, including a change to the EU’s treaties.

But the EU will quickly realise that the absence of Britain resolves few of its internal ruptures. In the run-up to the referendum Germany swiftly rebuffed overtures from France to advance euro-zone integration, including proposals like a finance minister and a pooling of common debt. Arguments over managing migration become no easier after Brexit because Britain had little to do with them in the first place. And governments are increasingly weary of the European Parliament’s instincts to federalise anything that moves.

In the longer term the EU will have to contend with the imbalances created by Britain’s absence. The balance between the euro zone’s “ins” and “outs”, central to the now-defunct renegotiation of Britain’s EU membership secured by David Cameron earlier this year, will shift dramatically. The EU will lose one of its strongest liberal voices on trade, competition and the single market; a proposed trade and investment deal with the United States may be one casualty of Brexit. And although Britain’s departure removes a brake on European defence co-operation, it also leaves France as the only EU member with any military clout. The leaders were due to discuss a new global foreign policy and security strategy for the EU, its first in 13 years, at next week’s summit. That will now be shelved for months, at least.

Is there any room for optimism amid this mess? “What doesn’t kill you makes you stronger,” said Mr Tusk this morning. It is a well-worn cliché of European integration that it only advances in times of crisis. The challenge now is to ensure that Brexit does not test that proposition to breaking point.

source The Economist, Friday, June 24, 2016