Wednesday, February 01, 2017

On The EU & Brexit

The following is a my Remainer's reply to a Brexiteer's comment on my last piece "The Uninspiring Antitheses to Populism". I wouldn't normally turn a reply into a post but I've been wanting to articulate most of these thoughts in Cassandra's record for the future. I've replied in-line to the commentator's (in boldface italics). All further comments, thoughts and replies are both welcomed and appreciated (especially opposing views):

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I am huge admirer of your blog and this piece of yours is an excellent example. However, although it's true that Brexit is fraught with downside risks to the UK economy, with few likely economic upsides, there are good reasons for its necessity nonetheless. The vast majority of UK voters and politicians are in favour of the club that we joined: an alliance of advanced West European countries bound together in a free-trade customs union.

Thank you for the kind comments. I have few doubts that that there reasons people hold for Brexit. Whether such reasons have virtue is more contentious. First, I'm sure I needn't recount the history of the EU as rooted in the ECSC. This was, first and foremost, a political project and for very good reasons following the scale of death & destruction from two world wars, that was pragmatically rooted in mutual economic entanglement. Churchill knew this since his ideas were central. Ted Heath, the UK's steward, knew this, both when UK was rejected, and when his efforts were finally requited.

But our Continental partners pushed on with a different vision: a nation called Europe 

I can't find the nation called Europe, anywhere. Yes some members have agreed currency union. Others have chosen to do away with internal borders. Some even "feel" themselves more European in spirit than their national identity. But last time I looked, UK was not a member of either Schengen or the Eurozone.  If anything it is for THOSE countries to feel concerned about real or imagined EU power usurption - NOT Britain. After all, it is they (not UK) who will in likelihood, eventually move towards at least a weak form of fiscal union – probably weaker than Canada which itself is one of the weaker federal unions. But why should that concern the UK? Yes, it may sap more political energy and activism, but that should suit UK just fine as they are, by your own view, interested in a narrowly purposeful trading union.

Most Brexiteers who claim to support Free Trade speak derisively of a “single market”, but it's worth re-stating that, for most, a single market IS the holy grail of free-trade. It is precisely what drives the internal economic might of the US. It is far more powerful and liberating than a mere "free-trade zone" or "customs union". It levels the playing field helping prevent cheaters (e.g from excessively polluting or abusing labour safety in order to gain cost advantage), and closet exclusion (e.g.  domestic agencies like VOSA from creating NTBs that might reference “peculiarly special nature of UK roads” to exclude foreign made cars). There's obviously much more - much of what individual nations would do of their own accord for their own benefit, but is far more efficiently accomplished and sensibly implemented at large scale (pharma & chem  regulations; health & safety, environmental standards. Most are essential since pollution, food safety, etc  don't respect borders  One need only look at the idiocy of US insurance regulation where each state maintains it's own insurance commission and regulatory regime, to realize the value. But a single market is decidedly NOT a nation, nor does pretend to be. Yes, ALL members cede a modicum of sovereignty (Britain less than others) in exchange for the large opportunity within the single market . Fortunately, the EU  remains a customs union as well (like the one the UK joined) since they are not mutually exclusive, which has even more palpable advantage than it did when Britain joined. This is particularly true when broadening the Single Market's opportunity against larger, and more powerful counterparties (US, China, Japan, India)  which is where most major trade results. The advantage is counter-veiling power as well as technical negotiating ability. Outside of Fishing, I've heard few if any Brexiteer talk specifics of trade that would occur, but that hasn't as a result of the EU, although we have heard an endless stream of concrete examples of how the UK benefits from both customs union and single-market membership. While I'm sure you are not in the “Tea Kettle Paranoia Brigade” using bogus stories about “how the EU is intending to legislate-away Britain's Tea kettles” I remain open to the evidence that will sway my opinion

Everything changes. Institutions evolve. Complaining about change or evolution is like the spouse complaining ”that his partner's aged, and he didn't sign up for that”. Nothing stays the same. Mere evolution with the times is frankly insufficient ground for divorce. This is not to deny there aren't ever grounds for divorce. There are. I've just yet to hear them well-articulated by Brexiteers. And for those who make the economic case built upon new potential trade - I've yet to see this potential "time-weighted or probability adjusted - which is essential to cost vs. benefit analysis.

within which Britain would be merely a "member". 

All countries are “merely members”..  All have rights and obligations. The matters of the community are mostly pragmatic – not grandiose, or for most except the UK, contentious. Therefore, I am suspicious of exceptionalist arguments, that either accuse other members or believe they themselves should be conferred extra-special rights by history or aggrandized self-opinion.  Britain is a small nation in the world, with rich history and tradition. Contrary to the view of Euroskeptics, the UK is important in the EU, playing an vital role, from which it derives enormous benefit – not least peace and growing prosperity of its neighbors. At its worst, the UK might consider the cost  “a small net annual prosperity dues”  - i.e. an immunization against the considerable costs of cost of war, autocracy, corruption, breakdown in the rule of law etc.

Worse, it has become clear that the power driving the new EU Nation would be centred on Berlin and Frankfurt with its Admin Centres in Brussels and Strasbourg so as to save face for the French. 

I appreciate there some British suspicion and jealousy exists. But to me as a detached American observer, living in Britain with a European Passport, it appears that the neutral Belgians got the Senior Admin, the French got the Parliament (some spillover bens to Germany), the Dutch got the judiciary, the Danes got the Environment, the Germans took the ECB, & the Brits got The City as the central Financial & Insurance capital, AS WELL AS the Euro equiv of the FDA . I think the view painted and held by Euroskeptics is a bit paranoid. On the surface, the Germans appears to get the raw deal, paying most and getting least. The Commission doesn't appear skewed, but a fair representation of the community. If anything, voting history suggested Germans have historically sided with Brits, and the UK exit will be most sorely missed by the Germans. More comprehensive research by the LSE suggests this is isn't reflective because there are different political approaches amongst members that skew results (i.e. much coalition-building/vetting happens before official votes, and it's here where Brits have been most effective (and valued by Germans). It's incumbent upon skeptics to make a more substantive case that Britain is somehow on the verge of getting shafted by an enlarged Community and Commission (that it must be said, the UK themselves were ardent supporters of).  Some even argue further that the EU was a conspiracy set up for the benefit of France. I would liken this to the history of the internet which was founded to connect a few physicists, but now has evolved as the most important tool for mankind, with creators accruing little to no benefit. Whatever the EUs origins, the present system is quite distant in the most positive sense, while the benefits are more universally-shared and felt among all her members.  

This is an intolerable drift towards a European political configuration that Britain fought two great wars in the 20th Century to prevent. 

If one were to distill the war and it's aftermath, one might say, Britain fought two great wars to diminish the likelihood of having to fight further wars. Oh, yes politics were dirtier and less transparent in WW1 (this isn't the venue for rehashing UK diplomacy of the era, and WW2 might have been avoided altogether if the French had only heeded JMKeynes. Britain's own enthusiastic support for enlargement was as much predicated upon the desire to consolidate free-market liberal democracy in Eastern Europe (for the same reasons as membership had been extended to the Italians, Spanish & Portuguese as they emerged from struggles with isolationist authoritarianism) as the desire to extend and reap the benefits of a single common market  As an American with a sense of history, I would argue my country didn't fight two world wars in Europe to see Europe splinter and the continent become a quarrelsome door-mat for Russia  We fought the wars, created, funded, supported  Marshall Plan, NATOetc.  to NOT fight another war, to insure spread of democracy and self-determination, to prime European markets and consumer demand for US good/services, and yes, to contain the Soviets and illiberalism. Little of that rationale has changed, even of the commitments and rules have altered with time.

Furthermore, the EU is not democratic and may soon not even be liberal. 

Citing the possibility that in the future the EU may become illiberal as a reason or cause to Brexit is rather like filing for divorce because you suspect that, one day, hypothetically, your spouse might have an affair. This is absurd logic, and even worse national behaviour as a state and party to existing treaties.

There are many forms of democracy and the UK's own “first-past-the-post” is but one (and itself highly flawed), even before considering the “House of Lords”. By your own definition of “undemocratic", the UK's Prime Minister herself is illegitimate since there is no direct election by The People, of UK PMs, and Mrs May even less so. But this hypocrisy rarely silences critics, or sets them to work on bills to yield more power to the UK People. You've left out the reason that some use positing the superiority and longevity of UK Democracy at Westerminster as much stronger than than on the continent. I, too, hold the UK's democratic tradition  in high esteem. At then time, I also marveled at the traditions and longevity in Athens, and in Rome. But longevity, as demonstrated by our Greek and Roman forebearers, says little about the future. If anything, it portends darker days.

The lack of democracy is not only evident in the fact that EU laws are almost entirely manufactured by faceless and overpaid bureaucrats.  

Euroskeptics and Brexiteers make much of “EU Laws”. In the main, they are either related to development of the single market or are laws that are the lattice binding nations to their agreements/responsibilities and conferring, and  importantly protecting  rights among their citizens, rather constricting their individual rights. As an individual citizen, this is decidedly reassuring to know. Perhaps Brits will only appreciate this benefit AFTER they suffer from the indignity of fascism or authoritarianism. Continentals understand its value presently for obvious reasons.

For most UK citizens, their laws are manufactured by faceless bureaucrats whom they don't know, and most often, didn't vote for, who get paid much more than them, and have staff (often family members) who are also faceless. However true this argument may be, it has problems. First, what  IS a “faceless bureaucrat”? This is a classic Tim Bell turn-of-phrase that sounds ominous but is insidiously demagogic. Commissioners (presumably the faceless bureaucrats you are talking about, are the A-Team of each member country. Leon Brittan, Chris Patten, Neil Kinnock, (of sorts) Catherine Ashton, UKs last four Commission Representatives hardly seem nameless or faceless. We may not know the A-Team from each others' countries, any more than Brit's know MPs other than their own. But they are appointed by the delegated representatives, elected by the people for each member country, and hardly faceless. Most UK policy and directives are made by appointees, appointed by elected delegated representatives, or career members of the civil service. It is true that the Commission are the sole introducers of legislation, but member states directly, and parliament ( who often brings ideas to the commission to introduce) also are part of the process so it's just simply wrong to characterize the producers of legislation as faceless bureaucrats.

Over-paid & Over-privileged? I sympathize with this claim and think member nations should make clear through their commissioners that IF you're going to suggest members tighten belts and restrain pensions, it might be best to set the good example. Headline egregiousness is typically focused on the 28 EU Commissioners. It's doubtful EU impoverishes its lower level civil servants, but it's always been with the UK government's ability to bring this to the fore. Interestingly, one hasn't seen the Brexit MEPs relinquish portions of their salaries to prove the point by example, nor has it gone unnoticed that Brexit MEPs were less-than-restrained when it came to claiming their own expenses. Nor did Brexit MEPs set the example for attendance at their respective membership committees  (which were appalling). On the other hand, UK's maligned faceless bureaucrats, from Leon Brittan to the recently resigned Lord Hill were all deemed to extraordinary Representatives of the UK's public interest, and extremely well-regarded Team Players and managers of their respective portfolios within the commission. Here, there is disconnect as the Brexit MEP slackers mooched and whinged for parochial political gain, while the lavish layabouts worked their asses off.  What one CAN accurately say, is there is a communications failure, be it the UK Press (for it's own commercial advantage or for benefit of the political  views of its patrons and shareholders), or just the arcane and boring nature of the majority of the work of the commission. NOT unimportant – just less-than-newsworthy  in the Fleet St. sense

Even the apparent democracy of the EU Parliament is a sham. In the U.K., for example, an MEP is chosen by the Party List form of proportion representation. The latter guarantees that the actual MPs close to top of those list will become elected. The selection is made by a few Party Managers and thereafter hardly any potential voter has any idea or interest in who is meant to be representing them in Brussels. In other words, it's a stitch-up.

Many representative democracies have found proportional representation MORE democratic than first-past-the-post. I agree with them, and think first-past-the-post is less well-suited to representative democracy especially in the 21st century where identity and interest is truly more fragmented than ever before and large parties are finding it increasingly difficult to aggregate and represent The People's majority will.  Proportional Rep results in the majority in and around the pragmatic center coalescing to do the right thing for the most people in the Public's Interest. I fail to find fault in this approach, but appreciate the strangeness for the UK as an outlier democracy. One needn't recount the flaws in first-past-the-post (Just look at Trump!), or that Lib Dems  could win  8% of the popular vote & 2% of seats, or SNPs with 5% of vote & 10% of seats or admittedly UKIP with 12% yielding just 1 seat. True representative democracy – that truly represents the variety of political interests NOT one's parochial local geography is unfamiliar, but upon reflection, more thoughtfully democratic

Thereafter, the MEPs need to no work, they oft n pay their partners as PAs and generally live it up (often with their mistresses whilst in Strasbourg and Brussels).

It appears as if your description by UK Eurosceptics and UKIP MEPs characterizes rather well the Brexiteer MEPs. Or embarrassingly for that matter UK's own MPs, across all the parties.  I cannot defend the rest of the MEPs, but at best it makes the Euroskeptics and Brexiteers hypocrites. If reform is warranted the are plenty of avenues to purpose before throwing the toys from the pram and sacrificing the project that has substantially contributed to uninterrupted peace and one of the longest periods of of the most profound economic prosperity in modernity.

Pay and pensions are high. It's corrupt and unreformable.

Yes on pay and pensions, and categorically, no on reformability. I believe almost everything can be reformed, and hold no such strident fixed ideas. Each and every day is a new day. Just look at the east of Germany or the pragmatic evolution of German labour unions. Anything is possible The political importance and economic advantages conferred by the EU are far too important to jettison over parochialism, nostalgia, or petty pessimism based on some queer form of exceptionalism.

David Cameron didn't want Brexit, he just sought some help from Merkel, Hollande and The EU to get some control of the UK's borders. And why the hell not? But he got nothing. Therefore, I would suggest, if this is a cock-up, those responsible are not the British. In particular, a bit of foresight from Merkel would have avoided it. Sometimes there is more to geopolitics than just trade and economics. Otherwise, why should Britain not have caved to the Germans in 1939?

I am personally sympathetic to Populist fears on immigration. Not because I fear immigration itself (all evidence suggests it IS a positive), and not because I think it will continue ad infinitum (it WILL reverse as Blighty is squalid compared to compared to most of the continent), but rather because UK is most densely populated member by a wide margin, and the stresses ARE exacerbated by Tory indifference & austerity to investment needs (education, healthcare, roads, transport) to accommodate and therefore profit from the inflows. So while its true that few continentals appreciate just how densely populated it is in the south of the UK, successive UK Govts must share a large portion of culpability. One cannot have all the benefits of immigration without bearing investment costs which BTW are long-term investments with long-tail benefits (lower dependency ratio being primary) along with improved infrastructure & enhanced skills-based competitiveness.

For domestic political expediency, the UK made little effort to throttle immigration pressure from non-EU origins, nor did they make reasonable attempts to modify welfare-pulls (totally-free point of use NHS, generous in-work benefit etc). The sovereign UK parliament and Govt had the freedom of UK policy prerogative. Which is their choice, but one elicits little sympathy by throwing a tantrum and making threats, when the Club's functioning is dependent to the greatest extent possible respectful cohesion to one's commitments or else other members (and their constituents) will ask why the UK is allowe to free-ride on cornerstone responsibilities when others are making sacrifices. Perhaps, had the UK first attempted to do what was within its formidable sovereign powers to solve its problems, AND not already been the EU Member with the most special deal (opt-out of the Euro, no Schengen, uniquely large fee rebate) they would have received more sympathy and very probably the cooperation on at least some of concessions sought. I've no special knowledge here – just the view of the detached observer. Look, I'm married, and know that negotiating with just one partner  is all-too-often fraught with difficulty and frustration. Yet, I remain married for many reasons - much of which is not economic. I see many others divorce, and believe that will end their problem yet, with a great many, I still see them suffering from the problems they projected onto the focus of their frustration and anger rather than look within at what they themselves can change.

Nothing is perfect – certainly not the EU. Despite it's numerous flaws, it represents positive progress across economic, social, judicial, and even political spheres. Economically, it represents the most ambitous and successful example of a single-market amongst independent states, and has built the infrastructure to extend this from a position of scale and strength. Socially, it has codified rights, opened enormous opportunity for its citizens to seamlessly move, study, work, and travel, as mutually recognizing qualifications across borders. Moreover, it is an important contributor to regions where development has been neglected. Judicially, it has created protections, and avenues of appeal, to citizens treated unfairly or unIawfully BY THEIR OWN GOVERNMENTS, checks without which citizens rights can be more easily be trampled by individuals state for parochial political purpose. Citizens in the UK, with an increasingly illiberal and authoritarian State, more than others, should appreciate the great value in this umbrella.I hesitated when including the political sphere because the evolution of democratic and transparent processes are new and still evolving. But I include it because the EU remains the single most ambitious cooperative endeavor to bring sovereign nations together in whereby each voluntarily yields a bit of sovereignty and accepts mutual responsibilities to other states in the community in exchange for benefits and payoffs whose return are far in excess of what they have paid.