European Affairs

Letter from London—the UK Referendum on EU in Perspective     Print Email

MichaelWhite2016In an Athens bar the other evening, a middle aged Greek of progressive outlook bemoaned to a London visitor the grim prospects facing his country, with a mixture of fear and anger. Greece had tried all permutations, governments of left, right and coalition, he protested. But it is still mired in debt levels which are unbearable for an economy that has lost 25% - yes, 25% - of its GDP since the financial crisis began.

What was striking to a foreign listener was not so much the detail of the man's distress, the staff job lost to insecure freelance work, the schools and health care systems which often work only with a bribe. It was the awkward realization that the tone of the Greek's complaints is echoed this spring across most of the European Union (EU) and on the U.S. presidential campaign trail. Resentful fury towards the perceived failure of political elites rages in regions and countries which have suffered nothing remotely comparable to the agony of Greece, ones that even collect their taxes (as Greece does not).

If anything symbolizes voter disaffection it is the toxic word “immigration.” Beset with the eurozone’s prolonged currency crisis, with stagnant growth and a resurgence of populist nationalism, the EU’s elite is now grappling ineffectually with an uncontrolled surge of economic migrants and refugees from disordered states, not seen since the aftermath of World War II. High fences, people smugglers, personal tragedies have long been familiar along the US-Mexican border. In Europe too, the mood is darkening despite Angela Merkel’s appeals for solidarity. What an irony that Greece, on the rack for its euro-debts, should be bearing the brunt of blame for mass migration to the north.

Such is the beleaguered context of Britain's now urgent debate on the future of its 43 year old relationship with “the continent,” as its island inhabitants still like to call Europe ("Fog in the Channel: Continent Isolated," a famous headline once announced). As of last week, when Conservative prime minister, David Cameron announced a “successful” renegotiation of that relationship in Brussels, a national referendum is officially scheduled. On June 23, 45 million Brits will be asked: “Should the United Kingdom remain a member of the European Union or leave the European Union?” Even that bland wording was closely scrutinized and amended to eliminate suspected bias.

What will the outcome be? A former Thatcher cabinet minister and long standing critic of the EU, privately predicts that the “Leave EU” campaign will lose by 60% to 40%. That would be close to re-endorsing the 67.2% to 32.7% verdict (turnout 65%) in Britain’s 1975 referendum, staged in near identical political circumstances. A divided Labour government staged a cosmetic renegotiation just two years after Britain first joined the original "common market” of six nations (now 28). The then prime minister, Harold Wilson, hoped to reunite party and country behind a clear decision. Forty-one years later, Cameron forlornly hopes the same.

He came to power in 2010 urging Conservative members of parliament (Tory MPs in the jargon) to “stop banging on about Europe,” the controversy that had split the party and helped keep it out of power for 13 Blair-dominated years. But, much as Republican activists hate “Washington” and all it stands for, so Brits have long hated “Brussels” (Lady Thatcher once called the EU “the Belgian empire”) for its rules and regulations, its constraints of cherished notions of national sovereignty, its commitment to the “free movement of people.” Much more tangible than “sovereignty” with its faint echoes of long-lost imperial grandeur, “free movement” translates for many as “Poles is our street, taking our jobs.” No one realized that close to a million East Europeans, many bilingual young graduates, would be drawn into Britain’s relatively buoyant and open economy.

The Thatcherite cabinet veteran may be guilty of defeatism. He is certainly premature in his verdict. As in Greece, the public mood in Britain is disaffected on a host of issues for which "Europe" may prove a convenient whipping boy. Seven years after the banking crisis on both sides of the Atlantic, the UK’s GDP has finally recovered from its 7% dip, though growth and optimism are again faltering in 2016 as the world economy does. Despite six years of "austerity" under Cameron's finance minister, Chancellor of the Exchequer, George Osborne, the pain of public spending squeezes on education, health care and social security has not cut either the fiscal deficit or national debt to anything like their levels before the bankers cried "Help." Making matters worse, the crisis also meant that booming City of London's tax revenues collapsed in the same moment. Greedy, incompetent (or worse), thoroughly unrepentant (UK regulators have jailed far fewer miscreants than New York's), the banks will be offsetting renewed profits against past losses for years. The taxpayer is not so lucky.

With varying details, the story sounds familiar across most G20 economies. Incumbent governments have recently been punished in Spain, Portugal and --last week--in Ireland. Cameron was re-elected last May 7 because the alternatives were deemed worse, but he is not widely loved. The loss of Labour’s Scottish citadel to the breakaway Scottish Nationalist Party (SNP) hobbles Cameron’s main rival, which has fallen into the embrace of its most leftwing leader, the bearded pacifist, Jeremy Corbyn, Britain’s Bernie Sanders. The UK Independence Party, the nearest approximation to an English Nationalist Party with a touch of the Tea Party, functions chiefly as a vehicle for protest votes, not fit for power.

So public disaffection has to find new outlets. As such, it has the potential to wreak havoc on June 23. Nervous pollsters, who failed to predict the outright parliamentary majority Cameron won in the UK's 2015 general election, hedge their bets. Some polls give “Brexit” (the shorthand phrase for “British Exit”) a slim majority. Most acknowledge that around one third of Brits are firmly attached to the In or Out camp while the remaining third are open to arguments now being deployed in strident and apocalyptic term.

Enter stage right, Boris Johnson MP, the disheveled elected mayor of London, star columnist and popular public personality, beneath whose blond hair lurks a high-powered brain and ambition to succeed Cameron, his near contemporary at Eton and Oxford, as PM. To some Boris-- it is always Boris-- is Britain’s Berlusconi, its Donald Trump, an unscrupulous buffoon who happens to have been born in New York. But when Johnson came off the fence and declared for the Brexit camp last week, it was front page news. At last the fissiparous Leave campaign, awash with personal and policy feuds, might have a figurehead who could swing wavering voters. Only this week Boris called Cameron’s renegotiated terms-- better protection for sensitive UK issues-- “baloney.” Cue for more headlines.

Just like Wilson in 1975, Cameron had been forced to suspend the rules of collective cabinet responsibility to allow six colleagues, including his friend, the justice secretary, Michael Gove, to campaign for Brexit and what they see as a free trading relationship with Europe, shorn of the costs and bureaucracy of full EU membership, shorn of its open borders obligations. Whenever the “Stronger in Europe” campaign raises practical objections to claims that all this will be easy to do and cost-free, it is accused of negativity and of organizing a “Project Fear.” Precisely the same complaint was raised by the SNP during Scotland’s independence referendum which Cameron narrowly won (55% to 45%) in 2014. Defending the status quo is rarely as exciting a promising a brave new future to jaded voters.

Safety first and the status quo usually prevail in referendums. As in 1975, the main parties, Tory, Labour, Liberal Democrat, even SNP, are pro-EU, though (unlike 1975) the main conservative newspapers are not and claim that their heroine, Lady Thatcher, would have changed sides too. Some Thatcher intimates deny that; her head would have ruled her heart as it usually did, they say. These are not usual times. Jittery stock markets are selling sterling. Oil sheikhs and oligarchs threaten to disinvest.

What is shocking to outsiders is just how insular Britain’s debate has suddenly become. Economic austerity, coupled with mismanaged foreign wars in Iraq and Afghanistan, have fostered isolationism last seen in the 1890s. EU partners, led by the redoubtable Merkel, would prefer to concentrate on the eurozone’s interlocking banking and currency problems, on the waves of refugees heading north from Africa and the Middle East. Instead, they spent much of their February summit helping Mr. Cameron solve a domestic party management problem for semi-detached Britain.

They will be greatly displeased if Cameron fails to win on June 23 and the subsequent divorce proceedings will be protracted and messy, the outcome uncertain. What the EU elite fear most is that a vote for Brexit will encourage far more disreputable nationalist, populist parties, already growing in strength across Europe, to copy London’s demand for special treatment. France’s National Front will be first in the queue. “Frexit” is suddenly the embodiment of a potentially fatal contagion that could break up the EU.

What about the prevention of European wars, the EU’s original purpose in the 1950s, ask old hands? What about Mr. Putin’s renewed menace and the threat from ISIS? That’s all a matter for Nato which keeps the peace, not the EU, comes the blithe reply. When Barack Obama or another foreign statesman dares express the hope that Britain stays in Europe (and that Britain stays united against the continuing campaign for Scottish independence that a Brexit vote would probably clinch), they are told to mind their own business.

It is all very unsettling, and the fact that other countries face similar challenges, nationalist and populist in character, might offer some comfort. Or it might simply increase the likelihood of over-assertive miscalculation if things go badly wrong. On June 23 they just might.

Michael White, long time writer and editor at The Guardian writes about politics in London.