From Brexit to Breferendum
The consequences of the Brexit self-delusion are now becoming obvious, as Britain's government finds itself unable to get a parliamentary majority for any realistic plan to leave the EU. If this situation persists, Britain will have only one alternative: another referendum to reconsider the impossible result of the 2016 vote.
If something is impossible, it does not happen. If a country votes to make two plus two equal five, this “democratic decision” will eventually be overridden by the rules of arithmetic, no matter how large the majority or how loudly “The People have spoken.” This is the story now playing out in Britain as Theresa May’s government stumbles toward the final act of the Brexit tragi-comedy.
In 2016, the British people voted to leave the European Union while keeping “the exact same benefits” they enjoyed as EU members. David Davis, May’s former minister responsible for negotiating Brexit with the EU, used that phrase repeatedly in Parliament, and it was then taken up enthusiastically by May herself. The promises by former foreign secretary Boris Johnson, the chief Brexit campaigner, were even more fulsome: Britons would have complete freedom to live, work, and study throughout Europe; untrammelled access to the EU single market; and full participation in whatever political institutions a post-Brexit government might feel like cherry-picking from the EU orchard. In short, the 2016 referendum was a vote for two plus two equals five.
The consequences of this self-delusion are now becoming obvious, as Britain’s government finds itself unable to get a parliamentary majority for any realistic Brexit plan. If this situation persists, Britain will have only one alternative: another referendum to reconsider the impossible result of the 2016 vote.
The Times now estimates that there is a 50% probability of such a referendum. When Justine Greening, one of May’s recently sacked cabinet ministers, became the first senior Conservative to propose this option, the objections raised to it were no longer about the principle of a second referendum, but about the difficulty of deciding the right question and method of casting votes.
A new referendum is rising to the top of Britain’s political agenda because of the self-defeating behaviour of the Conservative Party’s hardline Brexiteers. When Davis and Johnson resigned from May’s cabinet, chaotic parliamentary rebellions – from both the Eurosceptic and pro-European factions of the party – ensued. As a result, the main opposition Labour Party now sees a realistic chance of bringing down May’s government and triggering a general election by uniting with either hardline Brexiteers or pro-European Conservative rebels to kill whatever Brexit plan May ultimately puts to Parliament. Labour opposition makes every Brexit option almost certain to be blocked.
Start with the threat of a “no deal” rupture, whereby Britain would crash out of the EU with no agreement at all on a new relationship. This is now totally implausible, because all of Britain’s opposition parties, plus the clear majority of Conservative MPs whose primary loyalty is to business interests, would block it.
Almost as improbable is a “hard Brexit,” in which Britain and Europe agree to an orderly separation, but with no preferential arrangements for future trade. This, too, would be voted down by all the opposition parties, along with dozens of centrist Conservatives. Some of the Brexit hardliners also would oppose any such agreed separation, because it would force Britain to pay a large EU exit fee and to follow European rules for an open border with Ireland, in exchange for no commercial privileges at all.
May’s latest plan for a more cooperative “soft Brexit” now also faces insuperable opposition from Johnson and Davis, plus several dozen followers. These hardliners have denounced May’s new plan as “Brexit in Name Only” and a plot to turn Britain into an EU “vassal state.” Labour is now willing to enter an unholy alliance with them in the hope of precipitating a government collapse.
This leaves one final option: a parliamentary rebellion to stop Brexit. “Exit Brexit” is the official policy of the Liberals, the Greens, and the Scottish National Party. But all serious Brexiteers, plus the vast majority of Conservative MPs and the Labour leadership, who feel obliged to follow the “instructions” of the 2016 referendum obviously will not support this option.
If May finds herself unable to muster a parliamentary majority for any version of Brexit, resignation and a general election will not be her only recourse. One goal unites all the Conservative factions, regardless of their views on Europe: to avoid a general election and the risk of Labour winning power. This means that May could attach a referendum proposal to her preferred version of Brexit, justifiably claiming that Parliament’s response to the 2016 referendum should either be ratified or rejected by another popular vote. The criminal investigations launched recently into illegal spending by Johnson’s official Leave campaign, and allegations of Russian funding for former UK Independence Party leader Nigel Farage’s parallel campaign further justify a final referendum.
The Labour leadership would probably oppose a new referendum, because it would derail their efforts to force a general election. But, crucially, the Liberals and Scottish Nationalists would enthusiastically support a referendum as long as it offered voters the option of keeping Britain in the EU. As a result, May would have no trouble assembling a parliamentary majority for a legislative package that bundled her Brexit plan with a referendum to decide between it and the status quo alternative of remaining in the EU.
Logic suggests that such a referendum would reverse the 2016 decision to leave the EU, because any specific Brexit proposal presented by the government would be far less attractive than the utopian delusions that managed to secure only a narrow majority two years ago. But, by next year, the British people could be so angry with Europe that they vote Leave again. If so, Brexit could go ahead on whatever terms May negotiates, and nobody could complain about the consequences or costs.
Whatever the outcome, voters would have made an honest choice between genuinely and properly articulated options. That would be true democracy, instead of the demagoguery of two plus two equals five.
Anatole Kaletsky is Chief Economist and Co-Chairman of Gavekal Dragonomics. A former columnist at the Times of London, the International New York Times and the Financial Times, he is the author of Capitalism 4.0, The Birth of a New Economy, which anticipated many of the post-crisis transformations of the global economy. His 1985 book, Costs of Default, became an influential primer for Latin American and Asian governments negotiating debt defaults and restructurings with banks and the IMF. Copyright: Project Syndicate
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