Brexit: What Next?

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The United Kingdom’s extraordinary vote to leave the European Union brings with it many questions, not least how the British government will proceed in the next days and months. In the first hours after the votes were counted, German and British analysts offered their reactions to the referendum’s results and pondered the most urgent questions relating to a British exit from the EU: The discussion  considered how the EU’s “remaining” 27 member states would react to the decision. What does Brexit mean for EU unity? What does it mean for Germany? What does it mean for the euroskeptic movement across Europe and for political life more generally? Finally, why is it key that Brexit not be seen to work too smoothly?  Jana Puglierin, Head of the DGAP’s Alfred von Oppenheim Center for European Policy Studies,  moderated the discussion, which took place in English.

Calm and Firm
Describing the first reaction from Brussels, Elmar Brok, MEP and chairman of the European Parliament’s committee on foreign affairs, sounded resigned. “We take the vote of the British citizens seriously.”

“Last night, we agreed on three words in Brussels: Calm and Firm.”

Brok, who is currently the European Parliament’s longest-serving member, said that the UK will have to negotiate its exit “as a third country, not as a member of the European Union.” The British "will have to take the full internal market rules without having any rights to decide on them. They will have to take them all, without any opt-outs.” In short, there will be no “cherry-picking.”

Of the political implications of the referendum, Brok saw the outcome of the vote as  “a warning to all governments.” In Europe and the US, “we have a situation of a total breakdown in the [public] credibility of the elites on every political level.” If politicians “tell the people that what [they] cannot solve is the fault of Europe, the people will start to believe it.”

Lack of effective communication is a major part of the problem, he said. “If we do not talk about the advantages of Europe – if we do not tell them about the responsibility each national government takes as a member of the Council in Brussels, but [instead tell them] all the time that if it goes wrong it was the Commission’s fault, this is the ground for the populists.”

According to Brok, Berlin and Paris take credit “if the sun shines,” but “when it rains, it was Brussels.”

If national governments continue to engage in “tactical opportunism” of the sort that inspired David Cameron to call the Brexit referendum, the EU “will lose ground, and we will loose it bitterly.” The populists cannot be seen to become “the carriers of independence and freedom” in the popular imagination and in the press.

Looking ahead, Brok said that the EU would need the leadership of four countries in particular: France, Germany, Italy, and Poland. “We need a Europe that is able to deliver what the citizens are asking for.... What we hear from the People is: Europe does not deliver on migration, on [protection against] terror, on defense capabilities.” Brok is confidant that “these questions can be solved” within the framework of the EU’s current treaties.

How much pressure should the EU apply?
Sarah Raine, a consulting senior fellow for geopolitics and strategy at the International Institute for Strategic Studies (IISS) in London and a non-resident transatlantic fellow at the Berlin office of the German Marshall Fund of the United States, described her first reaction to the decision made by her fellow citizens.

“I am of course disheartened about this vote – disheartened by what it means for my country, a United Kingdom that is now less united; for the European Union, which is certainly now less of a union; and, more broadly for the forces of populism and nationalism.”

Like Elmar Brok, Raine remarked on the strong anti-establishment character of the vote. “This was a vote against Brussels and bureaucracy, but it was also a vote against elites. And that has resonance beyond the UK, not just with regard to the French elections coming up next year.” Populist sentiment is gaining ground. “Just look at the narrow escape that they had in Austria” and at the Five Star party’s victory in the mayoral race in Rome. “It’s going to be a difficult time, and we’ll want to think about it very carefully –  hopefully together.”

Asked to sketch the implications of the British vote on Europe’s foreign and security policy, Raine remarked. “There will be less change on the foreign policy front than you might actually think. France will now up its act with Germany on defense cooperation. I expect a reiteration of a very strong commitment to NATO – potentially even some sort of interest, in time, in the UK becoming a sort of third partner country, which would allow UK to contribute to select CSDP missions,” she said, referring to the EU’s Common Defense and Security Policy.

“While the situation domestically and for the European Union has been turned upside down, the foreign and security policy landscape will not necessarily be quite as tumultuous,” Raine said. Referring to the UK’s own security brief, she said, “I think you’ll see an effort to present a reassuring posture.”

Raine concluded her remarks with a plea that the EU “think carefully about what kind of pressure you want to apply to the UK for starting Article 50.”

Do you really mean, she asked, “that out is out?”

“Is there a special compromise that we can come up with? We have to be pragmatic about the business interests and the common values that we do still have. What can we do bilaterally to protect relations? What do we want to prioritize here? And how do you go about balancing the understandable need to set an example of the UK – Brexit cannot be seen to work too well – with the more pragmatic need for building productive bilateral relations?”

UK Independence Day is still a long way off
“I think the British have given up pragmatism for the day,” began Nicolai von Ondarza, deputy head of the research division on the EU/Europe at the German Institute for International and Security Affairs (SWP). The vote opens up “a lot of questions,” he said, particularly because the Brexiteers do not actually have a plan prepared for what to do in case of leaving.

“If we think back to the independence referendum in Scotland, the Scottish National party had a 200-page manuscript on what they wanted to do, with a detailed timeline that clearly laid out their legal steps in case of independence.”

“We have nothing of that kind for the Leave Campaign [apart from] some talk about a ‘dirty Brexit’ and some talk about Article 50. There is no clear idea of the strategic measures the UK wants to take.”

The EU expert noted that Article 50 “was pretty much designed to never be used” and only “outlines a rough procedure for exit.” This opens up many strategic questions, both for the UK and for Germany and other EU partners.

Ondarza reminded the group that until an exit agreement comes into force, the UK “remains a member of the EU with all the rights and duties. Including the rules of free movement. Including the veto right on budgets. Including their parliamentarians in the European Parliament, who will continue to have their voting rights, and of course [including] full voting powers in the Council of Ministers and the European Council. So Even if [Nigel] Farage speaks about ‘UK Independence Day,’ it will still be a long time before the UK has fully left the European Union.”

One open question is of course that of timing: “When will the UK actually trigger Article 50? The referendum is legally non-binding. There is nothing whatsoever in the UK’s EU Referendum Bill that binds the government or the House of Commons to trigger Article 50 in any shape or form. So it is completely up to the government.”

Ondarza noted the impossibility of Brexiteers showing “Leave” supporters a land of milk and honey anytime soon, despite enormous pressure to do so. “Whatever you could promise, they promised.” This included the return “probably ten times over” of the UK’s payments into the EU budget and the introduction of an Australian-style points system to limit immigration. “There will be a tendency in the hard-core, EU-skeptic British media like The Sun and the Daily Mail to push the government to implement reforms as soon as possible. Which is impossible as long as the UK is still a member of the EU.” The Brits “have to stick to the EU rules as long as they are a member of the European Union.”

Once those time-consuming exit negotiations get going, Germany will have a number of strategic decisions to make about their timing, form, and content. Ondarza reminded the audience that the agreement will not implicitly cover future economic relations between the United Kingdom and the EU. Mainstream legal opinion is that there are in fact “two separate agreements.” One covers only the “intermediate period” and addresses issues such as budget pay-outs and rules for EU citizens in the UK and British citizens in the other 27 states. The other agreement covers “the tricky economic issues.”

The most important of these issues is the future relation of the UK to the Single Market. “Any UK government will of course want to retain some sort of access to the Single Market. But we are already hearing clear communication from Brussels – including from Mr Brok – saying ‘Out is Out. Leave is Leave.’ Saying ‘We cannot give another opportunity for cherry picking to the UK. And ‘The Single Market is the crown jewel. If we give that away lightly, we invite other countries to leave as well.’ So I am sure those will be very, very hard negotiations.”

For Germans, the question is: “Do we want to negotiate these two agreements in tandem, as the British will probably want to do? Or do we want to fully separate these agreements, because it’s much easier to do the first one – and because this puts a lot more pressure on the UK economically. And I would guess the second part would rather take four, six, eight or even more years.”

Echoing Sarah Raine’s question about “how hard” the remaining EU member states would choose to be toward the UK during exit negotiations, Ondarza noted the difference in perception involved. “There is a very thin line between what the EU-27 might consider strict conditions and what the United Kingdom might consider punishing. This is the major balance we have to strike.”

Britain has Trumped America
“Very few people really expected this,” said Philip Oltermann, Berlin bureau chief of The Guardian and The Observer and author of the book Keeping Up with the Germans. “Everything has been thrown up in the air.” Oltermann presented the most important questions brought forward by the vote. These included, most urgently the questions of how Britain would be able to calm the and of how and when Britain will trigger Article 50.

A third point related to Scotland (whose majority voted to remain in the EU), particularly what it would mean for England were Scotland to push for another referendum to leave the UK.

“The interesting question,” he said, “is whether, at some point in the next five years, England – and maybe Wales – may suddenly find themselves truly isolated to an extent that those countries have never experienced before.”  "England has for a long time believed that it has stood alone in history but it hasn’t," said Oltermann, drawing on an observation by Fintan O'Toole. It has been part of a Franco-British kingdom, part of an empire, part of a European Union, part of Great Britain.

Another very personal question relates to the presence of EU citizens in Britain. Oltermann said that Michael Gove and Boris Johnson and other politicians from the Leave camp would need to address “the fears” of the many EU migrants currently living in the UK, including those who have lived there for decades. “I used to be one. I am German but I lived in Britain for 18 years.”

“My gravest concern really is that we might see that, in a year’s time, immigration figures won’t go down. Then I think UKIP and the Euroskeptics will leap on that, and then they will have their narrative of being stabbed in the back – their story of how ‘the People’s Will has been betrayed.’ And I think that will be even more toxic than what we’ve got now.”

Oltermann described one scenario he feared: “That they will step up to people like me and say ‘Why are you still here? We voted for you to leave.’ That is a terrifying scenario.”

Oltermann, like Brok, compared the Brexit referendum to the election campaign currently underway in the US. “People have been talking about ‘post-Truth politics’ in America,” he said. “Well, Britain has Trumped America. It’s jumped ahead of the queue. We have seen an election now won on post-truth campaigning. The consequences of that for future elections in Britain are terrifying.”

Early Bird Breakfast: The Morning after the Vote

Panelists:           

Elmar Brok, MEP, Chairman, EP Committee on Foreign Affairs

Philip Oltermann, Berlin Bureau Chief, The Guardian & The Observer 

Nicolai von Ondarza, Deputy Head of Research Division EU/Europe, German Institute for International and Security Affairs (SWP)

Sarah Raine, Consulting Senior Fellow for Geopolitics and Strategy at the International Institute for Strategic Studies and Non-Resident Transatlantic Fellow, German Marshall Fund of the United States

Moderator: Jana Puglierin, Head of the DGAP’s Alfred von Oppenheim Center for European Policy Studies