Tuesday 5 December 2017

Brexit won't happen !


“Ma’am, you are the first British monarch to return from a foreign adventure by land!” These words, spoken by Alastair Morton, co-chairman of Eurotunnel to Queen Elizabeth, at the tunnel’s official opening in Folkestone in May 1994, symbolise more than anything else the historic and indissoluble link between the United Kingdom and the European Continent. The UK’s accession to the European Economic Community, as it then was, on January 1st 1973, was of course a momentous event in itself, putting an end, or so it seemed at the time, to 25 years of British hesitation about its future relationship with Europe. But the tunnel cemented that link for good, both literally and metaphorically.  Nothing would ever be the same again after cars and lorries could simply drive on to a shuttle train and drive off at the other end or passengers board a train in one capital city and alight less than 3 hours later in another. Despite the initial traffic figures, far below those predicted and a devastating fire in 1996, the tunnel has gone from strength to strength, been rescued from the verge of bankruptcy and today notches up record figures, month after month, for crossings of passengers, trains, cars and lorries. Remarkably, and somewhat counter-intuitively, its business has continued to prosper since the Brexit referendum in June 2016. After an initial fall, its share price has now recovered to its pre-referendum level, reflecting investors’ confidence in its future.



It’s not difficult to see why. After arriving at St. Pancras station, a passenger’s first stop may be a coffee shop on the station concourse. More often than not, it is staffed by young men and women from France, Spain or Italy, keen to take advantage of the UK’s flexible labour market, earn a bit of money and improve their English, even if it means living in a cramped shared flat with several others. In a more up-market pub and restaurant upstairs, the waiters and waitresses are Polish. The last time I had lunch there, a couple of months ago, the faces were all new but still Polish. The last time I stayed at a hotel in London the receptionist was …Polish. If you are unlucky enough to have to go to an Accident and Emergency department at a British hospital you might well be attended to by a German junior doctor and a Spanish nurse. Walking through Camden market not so long ago, I struck up a conversation with two young Frenchmen who spend their week preparing meals for corporate dining rooms in the City and their weekends selling imported French cheeses on a market stall.



This anecdotal evidence however, that any casual visitor to London cannot fail to pick up, is just the tip of an economic iceberg that has seen exchanges of all kinds between the UK and the European continent grow and multiply over the last 45 years as the whole of the EU has slowly become more integrated. The tunnel has definitely accelerated that trend. Japanese car makers like Honda and Nissan import car parts into the UK on a just-in-time basis, assemble cars in ultra modern plants and then export the finished products to be sold on the continent. British start-ups, like start-ups everywhere, rely on a range of skilled employees from all over Europe and the rest of the world. Britain’s thriving financial services industry, thanks to “passporting” rights, can engage in financial business throughout the EU. The examples could go on and on and on.



Why then did 52% of those who voted in the 2016 referendum decide to turn their back on all this and feel that Britain could go it alone? Why did the area around Sunderland for instance, home of the Nissan car plant, one of the largest local employers and dependent on exports to the rest of the EU, decide by 61% to leave? Part of the answer is surely the political mood at the time with many voters still suffering from the slow-burning impact of the 2007-08 crisis and happy to take the referendum as an excuse to vent their displeasure with their country’s aloof government. Political scientists have long established that voters, called on to vote in a referendum, often use it to protest about what might be peeving them at the time rather than answering the question they are asked. Over and above these immediate reasons however, the UK’s more fundamental ambivalence towards Europe has not changed much since the end of World War Two. Anybody who reads Hugo Young’s masterful account of relations between Britain and Europe from 1945 to 1998 (“This Blessed Plot – Britain and Europe from Churchill to Blair”, Macmillan, 1998) cannot help being struck by the permanence of the British establishment’s attitudes towards the European project in general, starting with the Schuman plan in 1950. As Lord David Hannay, who was deeply involved in the first negotiations to join the Common Market in 1961 (vetoed by President de Gaulle in 1963) is reported to have said in a recent speech: “In 1961-63, much like today, we had not really made up our minds what on earth we wanted to do.”



Seen against this background, the outcome of the Brexit referendum is perhaps therefore little more than another hiccup in the troubled relationship between Britain and the EU, on a par with the 1975 referendum, Prime Minister Thatcher’s successful but damaging campaign to gain a budget rebate in 1984, the opt-outs from Schengen and the Euro. My guess is that Boris Johnson and Michael Gove, who ran the successful “Leave” campaign on the grounds that Britain should “take back control”, rid itself from “interference” by the European Court of Justice and spend the money sent to “Brussels” on the NHS, together with their small band of extremist supporters, will not be treated kindly by the history books.  But beyond these increasingly ridiculous and opportunistic figures, the whole idea of Brexit may just be the final gasp of imperial glory, the now futile pretence that Britain is still strong enough to dictate its terms to the rest of the world, as it did when it presided over an Empire on which the sun never set. Together with the popular press that panders to the prejudices of those who have come off badly from globalisation and blame it all on Brussels, they will eventually have to concede, probably sooner rather than later, that they have made a big mistake and put their country’s future prosperity at risk.



The truth is that Britain’s European dimension has loomed increasingly large over the past 45 years and short of closing the tunnel, that nobody has suggested, that trend can only continue. As the Erasmus generation takes over from the imperial blimps, as employers from all sectors realise that they desperately need employees from the rest of the EU, as opinion leaders come to terms with the prospect of seriously compromising 60% of the country’s foreign trade, as civil servants are faced with the mind-boggling complexity of unpicking every single thread of a 45 year old alliance, opinion will surely shift and many of those who voted “Leave” in 2016 will come to regret their decision. If reports and polls are to be believed, some already do.



Prime Minister May has often repeated that: “Brexit means Brexit”. My guess is that Brexit will not happen.  Whether it is derailed by a new Prime Minister heading a reshuffled Conservative government, a change of government after a general election, a showdown vote in the House of Commons or the European Parliament or quite simply a second referendum, remains to be seen. But as the economist Herbert Stein said famously: “If something cannot go on forever, it will stop”.


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