Will They Stay or Will They Go? Former CIA Chief on the Brexit

Will They Stay or Will They Go? Former CIA Chief on the Brexit

Why you should care

Because rumors of the nation-state’s death were exaggerated.

Just a couple of decades ago, many leading thinkers were hurrahing a new phase of history — one in which the sovereignty mattered less, and nation-states became ever more interdependent.

So much for that.

Thursday, Britain goes to vote over the prospect of “Brexit” — abandoning the 28-member European Union — and the polls are seesawing all over the place. Those in the “Leave” faction argue that Britain has already surrendered too much sovereignty and will just increase its liabilities with continued membership. Those on the side of “Remain” warn of economic woes and waning influence if Britain goes. The debate is raging in pubs and conference rooms and over the airwaves. And as it happens, our longtime columnist and former acting CIA director John McLaughlin is just back from London. We took the opportunity to find out what happened to all those Maastricht Treaty dreams.

OZY: Why is Britain doing this?

John McLaughlin: First, let me say that the Brits are universally obsessing about this right now — it’s all you hear about. It’s even pushed Trump off the front pages.

It all started in 2015, when current Prime Minister David Cameron was heading into a tough reelection campaign. He was worried about keeping the support of an anti-EU faction in his Conservative Party and dogged by a challenge from the anti-EU Independent Party. To checkmate these factions, Cameron promised to hold a national referendum by 2017. He favors remaining in the EU and to improve the prospects has worked hard with other member states in recent months to secure amendments to British membership. These reduce somewhat the financial incentives for immigrants to come to the U.K. and shield the U.K. a bit from paying for EU-wide economic support measures.

OZY: Why should Americans care?

JM: The U.S. has supported the European integration movement since it began in the late 1950s. French and German leaders wanted to eliminate the possibility that the continent, after two World Wars, would ever fall into armed conflict again. The Union has succeeded in creating a large degree of economic interdependence among European countries, along with mechanisms for harmonizing diplomatic efforts to a degree.

But as the Union has enlarged by bringing in some of Europe’s newly independent countries in Eastern Europe, the former Yugoslavia and the Baltics, it has begun to creak under rules that require consensus on many controversial issues. This became even more difficult because of economic strains from the 2008 international financial crisis and the recent deluge of migrants from the Middle East and North Africa.

Countries like the U.S. and Japan have many important subsidiaries in the U.K. — Caterpillar, Japan’s Fujitsu, Nissan) as a gateway to the EU’s large, tariff-free single market. If the U.K. pulls out, they lose this advantage.

Moreover, Brexit could stimulate similar movements in other countries, such as Poland, Hungary and the Czech Republic, now chafing under rigorous economic and democratic standards the EU imposes. Moreover, within the U.K., a referendum win for “Leave” would almost certainly revive the independence movement in Scotland, which strongly favors “Remain,” thus opening the way to possible fragmentation of the kingdom itself. And in Ireland, the current open border between the British North and the independent republic to the south would revert to an international boundary, potentially introducing new frictions after some years of peace between the island’s factions.

OZY: What are the core arguments for “Remain” and “Leave”?

JM: On the “Remain” side, the arguments come down to two big points, which I heard senior British officials make during my visit. The first is economic. They argue that Britain is on the verge of leading Europe in the things where it excels, such as IT and financial services, and stands to become the leading economy in Europe by 2030. Those views are supported by a majority of economists who’ve chimed in, including from the International Monetary Fund and most American experts. Second, the “Remain” school asserts that British influence in Europe, indeed in the world, is enhanced by its EU membership, because Britain is often perceived as speaking for more than just London when it engages internationally.

The “Leave” side has a more emotional edge, which is not to suggest it is less powerful or appealing. EU opponents assert that membership increases the flow of immigrants to the U.K., who they claim are taking English jobs and straining services such as housing and the National Health Service. “Remain” advocates insist this is exaggerated, but the arguments have a strong nationalistic appeal and are capturing a good deal of anger stemming from economic and social strains, similar to what we saw in our U.S. primary elections. And some respected British economists insist that the U.K. would actually be more competitive and productive outside the Union and that its strengths in financial services are such that no one on the continent could really compete. They assert that excessive regulation by the EU actually smothers competition all across Europe.

OZY: So who’s going to win?

JM: The polls, notoriously unreliable in referenda, have seesawed back and forth. When I arrived in the U.K., the “Leave” side appeared to be surging. But the murder last week of a young female member of Parliament, a strong advocate of “Remain,” has injected another huge element of uncertainty. The assailant was mentally deranged and all parties and factions have united to condemn the act, which drew a nationwide outpouring of sympathy for the young victim’s family.

When pressed, most Brits I spoke with guess “Remain” will win by a small margin. But pressed further, none have confidence in any predictions. So join them in holding your breath on Thursday for a vote that could have enormous consequences for the U.K., for the United States and, over the longer term, for stability in the part of the world where most of our closest international partners live.

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