After Brexit Vote, a Choice for Europe: Move Forward, or Fall Back
Is “Europe” finished?
The latest polls and political prediction markets this week suggest that Britons will vote on Thursday to stay in the European Union. The Leave campaign, led by Boris Johnson, the former mayor of London who tried to whip up a surge of resentment against immigrants into a vote for Britain to leave the bloc, looks set to fail.
But even if the pro-European Remain cause pulls out a victory, the popular hostility against the decades-long process of European integration — evident not only in Britain but across the Continent — underscores a defining weakness. Europe itself lacks a firm democratic foundation.
Europe’s leaders face a clear-cut choice: For their integration agenda to succeed — preserving the free movement of people within the bloc, forging ahead with the euro and the single market, keeping doors open to outsiders — the E.U. must figure out how to overcome the narrow national interests and mistrust that tie it up in knots every time a collective response is needed.
That will require democracy on a European scale. If Europe’s national governments remain unwilling to cede political power to regional institutions that have democratic legitimacy, the European Union will slide backward.
“We need pan-E.U. politics,” argued Mary Kaldor, professor of global governance at the London School of Economics. “I don’t know how we get there.”
For all the complaints about the Brussels fudge factory, the discontent in Britain on Thursday probably will have little to do directly with Europe’s institutional shortcomings. “This is about frustration of the working class about a long period of deindustrialization,” Professor Kaldor said. Mr. Johnson is Britain’s Donald Trump. Europe is a stand-in for globalization.
“Popular discontent with globalization in its many forms has been building up in the West for many years now,” said Kevin O’Rourke, an economic historian at the University of Oxford. “We are seeing its effects everywhere.”
Still, the European Union’s hapless response to its current social and economic challenges has made it an easy target. With no real European institutions of democratic accountability — the European Parliament serves little more than a decorative function — the only way voters can express their dissatisfaction is by pushing to leave and by supporting extremist political movements.
“In many countries the perception is that national governments are powerless and that there is nothing at the European level to address problems,” said Paul De Grauwe, a former Belgian member of Parliament now at the London School of Economics. “Both Europe and national governments lose legitimacy.”
What could the E.U. have done better? Things would be a lot easier if most of Europe were growing at more than a snail’s pace. The inability of countries in the euro area — which does not include Britain — to stop the slow-motion implosion of Greece and other deeply indebted countries gives integration a bad name. The two are related.
Germany’s resistance to share in the costs of a collective solution to seriously write down the debts that Greece and other Southern European nations will never be able to pay off — insisting instead that the indebted countries and their beleaguered citizens bear nearly all the cost — has prolonged and deepened Europe’s stagnation.
“Britons contemplate the crisis of the euro as a little bit of proof that they were right not to join,” said Giancarlo Corsetti, a professor of macroeconomics at the University of Cambridge.
Britons have more control over immigration than the Leave campaign would have them believe. Refugee policies are decided in London. And it was the Labour government of Tony Blair that chose not to take advantage of a seven-year phase-in period to limit the entry of citizens of new members from Eastern Europe. Many of the Polish plumbers that so inflamed the British populace showed up because Britain — unlike, say, Germany — chose to let them in straight away.
Immigration, however, can easily be deployed as an argument to leave the rest of Europe. More than half the 333,000 immigrants who arrived in Britain last year were E.U. citizens, free to be there as a matter of right under European law.
“The Leave campaign made an argument that the only way to reduce this part of immigration is to leave the E.U.,” noted Jacob Funk Kirkegaard, an expert on immigration at the Peterson Institute for International Economics in Washington. “And they struck a chord with the electorate.”
Dealing with hundreds of thousands of refugees fleeing war will never be easy. But Europe’s reaction was notoriously unproductive. The E.U.’s institutions again appeared irrelevant, as governments retrenched into their corners and failed to devise a collective, burden-sharing approach.
In May, a group of European scholars proposed a set of collective financing mechanisms to reduce debt burdens along the E.U.’s periphery and to pay for a European Union-wide refugee policy. Their report concluded: “The sovereign debt and refugee crises prove that Europe has failed to design institutions that are robust enough to weather difficult times.”
How much integration do Europeans need? Dani Rodrik at Harvard’s Kennedy School of Government notes that the E.U.’s initial major goal — preventing France and Germany from drawing the world into another war — has been achieved. It also served as a democratic, capitalistic anchor for Eastern European countries to hang onto after the collapse of the Soviet bloc.
But today Europe’s integration effort has lost sight of its political and social dimensions, he argues, narrowing into a raw effort to reduce market barriers. That’s not enough to inspire popular support.
There might be areas where collective action at the European level could make a difference — as a counterweight to colossal multinational companies that can challenge the authority of individual nations, or to prevent capital from effortlessly zipping across borders in an effort to avoid taxes. Indeed, the E.U. has taken a leading role confronting the world’s most daunting collective action problem: climate change.
An aging Europe is going to need more immigrants. Smart collective strategies would surely help the Continent deal with what are likely to be decades of intense migration from the many poor countries in its extended neighborhood.
The critical question is whether Europe will be able to achieve the kind of integrated decision-making needed to address these challenges. So far, it hasn’t shown it can rise to the occasion. “There is not much appetite for further political integration,” Mr. Corsetti said. Solutions to Europe’s challenges must navigate around this constraint.
The free movement of people inside the E.U. might be the first to go into reverse. “Restricting the free movement of labor is not a taboo,” Mr. Kirkegaard told me. “Another way freedom of movement will be restricted is you will see more and more restrictions placed on the ability of citizens from other E.U. countries to claim welfare benefits.”
Maybe the European Union’s future is more “à la carte” — a set of coalitions of the willing, as it were. Rather than insisting on all or nothing, said Richard Haass, president of the Council of Foreign Relations in New York, it might be better to consider “a Europe that is not one size fits all, where the balance between national governments and Brussels is more flexible.”
This may come as a disappointment to Europe’s current leaders. But one way or another, the project’s governance must come into line with what its people want. That’s called democracy.
“Europe must either roll back the economic integration or roll ahead the political integration,” Mr. Haass said, “so people feel they have a say over the politicians who are driving changes that affect their lives.”