EU Brexit negotiator: I’ll ensure UK’s loss will be Europe’s gain

Given the immense financial troubles in Europe — the strangled economy, the squabbling over scraps, the lack of problem solving — it is shocking to realize just how badly the continent has handled its recent political dilemmas.

At every turn, rather than doubling down on the union — on finishing the federal project so as to create a rising tide that lifts all boats — we’ve seen member states desperate to eject their neighbours for the sake of ‘safety’ or frantic to escape in pursuit of a dubious ‘freedom’.

The most arresting example of this is, of course, the vote of the British people to leave the union.

On June 24, 2016, after that referendum, Europe and Great Britain woke up with a serious hangover. For the first time in the union’s history, a member state had decided to quit.

The impact was instant: a dramatic 30% drop in the pound sterling, a multi-billion-dollar slide in stock markets worldwide, and a freeze on UK investments.

Many economists estimate that the long-term damage will be even more severe. Before its EU membership, the UK had the slowest growth of the seven biggest economies in the world; it has had the fastest growth since it joined the union.

So, the EU has not been bad at all for Britain. Moreover, the UK had carved out a special status within the EU thanks to its rebate and its opt-outs from Schengen, the euro, and Justice and Home Affairs policies. As a member of the union, the country had largely concentrated its focus on the internal market, the main driver behind its good economic performance. That is exactly what Britain risks losing.

‘Winners shying away from victory’

The Brexiters campaigned with emotion, not rationality. After the vote, reality hit. Suddenly British workers saw the value of their pension funds cut or their dreams of living in Spain curtailed. Young people and students… who massively voted Remain, will be excluded from Erasmus, the European academic exchange program, from low tuition fees at European universities, and from hundreds of millions in European research grants from which UK universities profited disproportionately. But more than just ‘the happy few’ are affected. The inhabitants of the poorest cities in the southwest and the northeast of England will no longer receive aid.

Suddenly, all these EU membership benefits were headline news, whereas the tabloid press had never mentioned them previously, even in the heat of the campaign. But the negative economic fallout was hardly the most surprising outcome of the Brexit vote. The complete absence of euphoria in the winning camp struck me most, as did the tepid, almost timid, reactions of politicians like former London mayor Boris Johnson, the most prominent Brexiter.

During his press conference the day after the referendum, he sounded diffident, which was completely out of character, and declared the outcome of the referendum would change nothing — an absurd message after months of bitter campaigning… It was a pretty unique sight: winners shying away from their own victory.

The murmurs of the Leave camp contrasted sharply with the harsh messages from Scotland and Europe. Scottish first minister Nicola Sturgeon announced a possible second referendum on the secession of Scotland, as ‘the Scottish people have voted overwhelmingly to remain in the EU’. Political leaders in Northern Ireland started pipe-dreaming out loud about a reunited Ireland.

The rest of the European member states almost unanimously said Britain should leave the union quickly and in an orderly manner. The day after the referendum the Brits woke up feeling eerie in a divided country.

Had they voted for the end of a united Europe or for the end of the United Kingdom? Racism and xenophobia had been let loose. The Polish community was bullyragged as ‘vermin’; schoolkids of color were told ‘go back to their country’ — the results of a merciless Leave campaign that had focused in the nastiest way imaginable on migration instead of whether to Remain or Leave.

‘Many would have voted differently’

A lot of people who voted ‘leave’ were also in shock the day after the referendum. Many declared later that they had only wanted to get rid of David Cameron and his policies or that they would have voted differently had they known that a Brexit was really going to happen. Suddenly there were pro-European protests in the streets of London, and a petition for a second referendum received a massive number of signatures. If the Brexit vote proved anything, it proved the Remain camp right: the negative effects for the economy and society as a whole quickly set in. It has turned into a divorce that only a minority seems to have wanted. Normally, a victory has many fathers, while defeat is an orphan. This time, it was the other way around.

A Conservative ploy

Clearly the Leave camp had not prepared a plan to make the Brexit happen in an orderly fashion. It didn’t even have a contingency plan to mitigate the worst economic consequences, let alone clear a path forward. So, how could the Leave’camp have been completely clueless about something they staged themselves? The answer is simple: the real driving force behind the Brexit had nothing to do with Europe. The referendum had been cooked up to paper over deep divisions within the Conservative Party. It was a big show put on to ensure the unity of the party, whatever the cost; it was supposed to ensure peace and quiet at home. It did exactly the opposite: it deepened the division among Tories, split the whole country, and dragged the rest of the EU down with it.

The Conservative Party comprises three camps with regard to the European question. First, there are the many anti-European hard-liners who actually want the same thing as UKIP, namely, a complete withdrawal from the European Union and thus also from the single market, on the naive assumption that a UK-EU free trade agreement could be a done deal in a few weeks. Deep down, they are still ‘Little Englanders,’ clinging to the long-lost glory of the British Empire…

Diametrically opposed to this group stand the pro-Europeans, a somewhat smaller group still counting a few dozen members in the House of Commons. They helped dream up the most basic concept of the European treaties, the ‘ever closer union’, together with the principle of subsidiarity, which prescribes that political issues should be dealt with at the most local level possible. Sadly, these pro-Europeans are a dying breed… They are the dinosaurs of a moribund Tory tradition, disciples of Edward Heath, the Conservative prime minister who brought the UK into the union in the 1970s. Their number even included Margaret Thatcher in her early years, before she decided to score easy electoral points at Europe’s expense.

But the majority of British Tories, including fading lights such as George Osborne and David Cameron, belong to a third group within the Conservative Party that constantly oscillates between anti- and pro-Europeanism. They want mostly to participate in the single market and actually have few problems, if any, with the rest of the union — as long as things do not go too quickly or too far. They are arch pragmatists. Boris Johnson actually belongs in this camp. He had never made more than a few bantering, ironic remarks against the EU until he saw that a Brexit could catapult him to 10 Downing Street.

‘If we’re soft with Britain … we will feed anti-European parties elsewhere’

Now that Cameron’s bid to restore unity in his party has failed and even more damage has been done, it is important to understand that there is no way back. A second referendum or a reversal of the first one by the House of Commons is highly unlikely given that the Tory constituencies voted heavily in favour of Brexit. The only way forward is to accept the outcome of the referendum and use it as an opportunity for reform.

The biggest risk currently facing the EU is that Brexit negotiations will not start anytime soon, will drag on for years, and will join the long list of never-ending crises: the Greek crisis, the refugee crisis, an unresolved economic crisis, and the seemingly ever-present terrorist threat. If we’re soft now with Britain, giving it too much wiggle room to extract favours and deals, we will feed anti-European parties elsewhere in Europe and strengthen nationalists’ and populists’ belief that the EU is a doormat…

The EU must take the outcome of the referendum seriously and move forward with an in-depth reform of its outdated institutions and policies. The British people were right to question the ability of this EU to meet the challenges we Europeans face.

For years in a row now, the EU’s 28 national leaders have gathered around the negotiating table, looked each other in the eye, and decided not to decide.

In a certain way, we should welcome the outcome and seize it with both hands by not only writing the UK out of the treaty but also making sure the other 27 member states move forward. In other words we should undertake a fundamental redesign of the EU. If the British — who have always dragged their feet every time we wanted to integrate further — actually want to reinvent themselves by leaving the union, we should not make an issue of it. We finally have an opportunity actually to get a grip on our challenges.

Brexit provides a golden opportunity to put an end to the politics of horse trading and papering over the cracks that has characterised Europe since the 1957 Treaty of Rome. If some countries, with the UK at the front of the queue, do not want full membership, so be it.

My proposal is not exactly original. It harkens back to what the union’s founders had in mind back in 1953, when, under the leadership of Paul-Henri Spaak and Heinrich von Brentano, they drew up a first constitution for the EU. Even at that early stage, they envisaged a two-tier form of membership: a country could have either full or associate status, either participating in all union policy areas or essentially joining only the internal market, a bit like Norway and Switzerland.

Full union membership would entail signing on to all policies, participation in the economic and monetary union (and thus the euro, provided the country in question satisfied all relevant criteria), and mandatory cooperation on home affairs in connection with defence and justice. A full member would have access to an ‘ever closer union’ that would eventually end up as a federal union. No exceptions, no rebates. The ultimate aim would be the same for all. Any country becoming a full member would know that the train was heading to federation without further detours.

If that was just too much, or if a country could not or did not want to convince its people, it could sign on to associated status. This option would simply provide access to the internal market. However, it would come with an obligation to comply with all the conditions attached to that internal market. In that regard, the British need to realise that many of the rules they vilify, such as setting noise levels for vacuum cleaners or minimum quality levels for fruit, are part and parcel of a functional free market.

If the EU did not lay down rules of this kind, we would get overregulation at the national level, as in the past, with 28 different sizes and weights.

The UK has declared that it wants ‘to remain close to its European neighbours’, but it will have to decide what that new relationship will look like. Does it want a trade deal with the EU, like Canada or Japan? Or does it want to go a step further and have access to the internal market or the European Economic Area, like Iceland and Norway — under the condition, of course, that it also accepts the free movement of people. After all, Britain and Europe remain close geographically and are major trading partners.

There are goods and services to be sold on both sides of the English Channel. But remaining in the internal market would entail Britain’s complete acceptance of EU rules without having a seat at the table while paying a hefty membership fee for that access. That will be a hard sell for British politicians who vowed ‘to take our country back’. In any case, we have to end the current situation in which British representatives in the council and the parliament can vote on issues they have opted out of.

‘Is two-tier membership the solution?’

Is this two-tier form of membership the solution to our British problem? I do not know, but from my contact with leading Tories before the referendum, including the former British foreign secretary (and now chacellor), Philip Hammond, it would appear to be a serious option. It might present a way out of the stalemate the Brexit vote has created in British politics. For Europe, too, it would be a blessing. It would mean that countries uncomfortable with an ever-closer union no longer need hold us back. It could speed up the further integration needed to stabilise the euro. The same applies to the strengthening of our foreign policy, a necessity if Europe is to play a significant geopolitical role. This two-tier form of membership would also mean we could draw a line under the enormous complexity of the EU and the quagmire of European institutions. The à la carte Europe that we currently know, with its opt-ins, opt-outs, rebates, earmarks, enhanced cooperation, and concentric circles, ultimately satisfies no one. It does not satisfy the eurosceptics or the European federalists, as it makes Europe inexplicable and unsellable to broader public opinion. The British referendum should lead to exactly that clear choice—between full membership, associated status, or no relationship at all.

This article is an extract from Guy Verhofstadt’s book ‘Europe’s Last Chance’