What the heck happens now?

The result of the poll on 23 June is undeniable if narrow. The (small) majority of voters want the United Kingdom out of the European Union. But it has become glaringly obvious that there was simply no plan if the Brexit campaign won.

I’ve been trying to think of the possible options from this point onwards – mainly from the point of how do we ensure that the UK does not leave the EU, but accepting that it might have to. And I’ve come to the conclusion that the absence of good options from this position is what has been underpinning my dismay* at the result.

Don’t Invoke Article 50

The first clear option relies on the fact that the leave process is initiated by invoking Article 50 of the Lisbon Treaty. David Cameron implied that he would do this on 24 June if Leave won. He didn’t. And, during the campaign, some Leave campaigners indicated that it might take some time before this process is started. It is clear that many in the EU want the process to start sooner rather than later – but there is no ability for the EU to trigger this process. The decision is entirely in the member state’s hands. In theory, this decision could be suspended indefinitely – and it appears that the stock markets are beginning to think this might be the case, hence the recovery in the FTSE 100 at least (but no-one mention the FTSE 250, containing more UK-orientated companies, which is still sprawling on the floor).

So, if Article 50 isn’t invoked by the UK, then the UK doesn’t leave the EU. Simple. Job done. Except it isn’t. Even though the referendum is advisory in nature – the Westminster parliament remains sovereign – there is the little problem that the majority of voters expressed a clear opinion. Essentially our democracy means that Government only governs with the consent of the people. Government refusing to implement such a decision means, implicitly at least, that the consent of the people for this key part of their policy is withdrawn. Given that the offer of a referendum implies that Parliament cannot decide this issue, this becomes a key policy for Government.

Despite wanting Westminster to be sovereign, I strongly suspect that many, many vocal voices will be raised should the MPs or peers in Westminster decided that it was simply too risky or impractical to start the process of leaving the EU. I can easily see why it might be deemed risky, for a large number of reasons. After all, I voted to remain – and there’s a whole bunch, years even, of Parliamentary time required to amend all the laws.

Admittedly, the situation may change if the EU decided to offer the UK a compromise solution, so some of the concerns expressed (like freedom of movement) are addressed before the Article 50 process started. That could be grounds for deciding not to go ahead and leave – even though I suspect that things like freedom of movement are so core to the EU’s raison d’etre that it’s incredibly unlikely that the EU would take this route. Even so, I think this is the option that Johnson is relying on – but there would still be a question of the democratic deficit which may, in turn, be addressed by running a second referendum.

However, taking this action would only give rise to calls that the EU won’t ever admit a “wrong” answer. There are precedents for re-runs of referenda elsewhere in the EU, and even for ignoring referenda – but these were only about adopting treaties, not the desire to leave the club altogether.

Also there appears to be no formal route for the EU to offer the UK such terms. While the UK currently remains a member, it is clear that the other 27 countries are starting to exclude the UK from certain decisions based on the expressed will of the people – and the UK is accepting those exclusions, even if it may not be entirely compliant with our current membership terms. It is entirely possible that the EU decides to create another membership treaty, and offer the UK those new terms – but those negotiations take years, and it’s likely the UK will be excluded from most, if not all, of those discussions. Given the direction of travel of EU treaties (towards ever-greater union) is diametrically opposed to what the UK has said it wants, it’s unlikely that any new treaty offered to the UK will be acceptable to this Leave majority.

So we have to assume that, all things being equal, Article 50 will, at some point, be invoked, and that no substantive negotiations would take place before that point.

Start Article 50, then Stop It

The next option is to see if there is some mechanism to stop Article 50. Here, a straight reading of the treaty may indicate some wriggle room. Clause 2 states that “the Union shall negotiate and conclude an arrangement with [the] State” but doesn’t seem to make any provision should the State decide to reverse its decision to leave.

Quite how the UK would decide not to leave the EU after Article 50 is invoked is unclear – as we’ve already seen – although a general election and electing a new government, with a different party or parties in power and with a clear mandate for reversing the decision, might do it. I don’t think a continuation of a Conservative government would achieve this, even after a general election.

It’s also likely that the rest of the EU would really not be happy about the turbulence which has already been caused and which would have become unnecessary. Also, we would have no say in the details offered to stop the process – unlike the position beforehand where the UK could negotiate behind closed doors as an equal. The hand would be considerably stacked against us and we would have perilously few bargaining chips. I also struggle to see why there would be a political will in the other 27 countries to do this, because this would set a precedent for changing the terms for any country which expresses a possible desire to leave.

Different Trade Agreements

Assuming Article 50 is invoked, and the decision isn’t reversed (and is reversible), then the question turns to what relationship would be on offer. It is quite clear that we simply cannot have the same terms.

What appears to be on offer right now is signing up to the terms of the single market on the same sort of basis as Norway and Switzerland. This would involve paying in the same amount of money (or possibly more, as we’d probably lose our rebates) but losing our seat around the table. In other words, we would retain all the costs but lose some of the benefits we currently have – like the ability to help define the rules, or veto new members, or even keep our rebates and opt-outs.

This would be a politically absurd situation. Reclaiming sovereignty and taking control of our borders by leaving full membership of the EU, only to pay more and not actually achieve those things would clearly be incompatible with the understood and expressed will of the majority.

It might be possible to negotiate a slightly different deal with the EU, but it would be unlikely to have the unrestricted access to the single market that we seem to desire, and would probably also require contributions from the UK, again with no say.

A final option is to simply turn our back on the EU and look for trade deals elsewhere in the world. Currently the UK has around 20 trade negotiators. It would need a few hundred – and taking such an action would halve our exports, and have a considerably higher impact on our imports – at least in the short term. It wouldn’t completely stop trade with the EU, but would mean that import tariffs would apply, making trade more expensive. The UK is no longer self-sufficient in energy or food, so this option would have a dramatic effect on the country. Because of this, I can’t see this last option as viable. It’s not so much that the EU needs to trade with us, but that we desperately need to trade with the EU.

Summary

In summary then, I think the two most likely options are to start the Article 50 process, hope that the EU comes back with an offer to keep the UK in, and that the Article 50 process then stops (and a way is found to stop it) before it’s reached the end, or that the EU offers restricted access to the single market for a reduced contribution.

Neither is the nirvana that the Brexit campaign offered. The first would result in a diminution of the UK’s status within the EU – and our negotiating position on other decisions going forwards would remain weak until we had such time to rebuild it, which may take decades. However, this might be preferable to the second, which would likely result in a contraction of trade with the EU and the rights of UK citizens across the EU, and would require good (and quick) trade deals with the large economies elsewhere in the world to make up the difference.

There is simply no good solution to our current predicament, but rather trying to find the best out of a whole bunch of poor ones.

 

* Well, “dismay” is one way of wording it. “Thinly disguised fury” is another, possibly more accurate description. Not that I’m angry with those who voted Leave, but I am angry, furious even, at those who manipulated media stories, and those politicians who unnecessarily forced us into this complete and utter disastrous mess – especially those who are now trying to walk away from their responsibilities or deny that they said what they said.

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One comment

  1. […] has changed. We have the result of a vote to deal with. I wrote shortly after the result how there seemed to be no good routes from here. But the idea that, by continuing to campaign against Brexit, you’re simply in denial and should […]

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