Teleconference | After Brexit: A New World Order?

On June 24, 2016, the world awoke to the news that the United Kingdom had voted to leave the European Union. What followed were days of speculation and instability. On June 27, The Wilson Center’s Global Europe Program hosted a Ground Truth Briefing teleconference entitled: “After Brexit: A New World Order?” The discussion focused on what can be expected for the UK’s domestic and foreign policy following the referendum. Opening remarks were made by Wilson Center Director, President, and CEO, Congresswoman Jane Harman. The discussion was moderated by Kent Hughes, former Director of the Program on America and the Global Economy and Wilson Center Public Policy Fellow. The participants were: Michelle Egan, Professor in the School of International Service at American University and Wilson Center Fellow; James Hollifield, Professor and Director of the Tower Center at SMU and Wilson Center Public Policy Fellow; and Michael Geary, Assistant Professor at Maastricht University in the Netherlands, and Wilson Center Global Fellow. In her opening statement, Congresswoman Jane Harman referenced the previous Ground Truth Briefing – held just before the vote – and said the results were not surprising to her, after having seen the strong support for “Leave” during her recent visit to the United Kingdom. She argued that the impact of the vote will be negative in the short-term, but in the long-term, if handled well, could create good opportunities for the UK. Michelle Egan began the discussion by saying that at the upcoming European Union summit, David Cameron – now a lame duck – will need to be very cautious. The EU negotiating team is beginning to work, albeit unofficially, on the terms of exit. However, because of the dynamics within the EU, there is no consensus, specifically between France and Germany, on how negotiations should proceed. These negotiations will not begin officially, however, until the UK invokes Article 50 of the EU’s Lisbon Treaty. The departure of the UK is seen as a broad European problem that will affect each of the bloc’s member states. The vote to leave was due to a reactive populist national vote, argued James Hollifield. The traditional liberal consensus in Europe is that politics and human rights are under stress due to the rise of the far right and this is evident in the outcome of the vote. European leaders are currently in damage control mode, worried about economic fallout, political casualties, and cracks in the Western alliance – with the U.S. as a key ally. Hollifield also noted that the U.S. will most likely shift its focus to Berlin as its most critical foreign policy partner in Europe. Michael Geary spoke about the nature of the EU-UK marriage and argued that this separation is not surprising. The UK has always had a strained relationship with the EU – each British Prime Minister from Harold Wilson to David Cameron has had issues with the bloc. Cameron hoped to end this back-and-forth by holding the referendum, but ultimately failed. Geary also noted that his home country, Ireland, will be the only EU country to share a land border with the UK. In the short-term, he does not see any threat to the peace process in Northern Ireland. As for the continent, Geary echoed Hollifield’s expectations of a U.S. foreign policy pivot to Berlin. It will also fall upon Germany to calm tensions within the EU and manage the divorce settlement. Geary does not believe the claims that Brexit will be the end of the European dream, as the UK is not integral to the EU. Lessons learned from the referendum include the potential for more sovereignty for member states and less power in Brussels as well as what happens when too many are left behind by globalization. The question and answer portion of the teleconference raised a number of key issues: will similar referenda take place across the EU? Will this result mean we will see less power coming out of Brussels? Hollifield addressed these questions by arguing that the results will lead to a slowdown in integration and rethinking of EU strategy. The exit of the UK, a liberal country, demonstrates the surge of right wing politics and the EU will have to rethink about rebranding the European project. Geary noted that the UK has always been an anomaly in the EU and so the result may not lead to further referenda, but could prompt reform. There may be, for example, stricter enforcement of EU regulations. There was also a question about class politics. Egan argued that the vote was seen as a working class protest against the EU due to economic instability causing domestic unrest over public services and income inequality, for example. Egan was asked about the implications for the Transatlantic Trade and Investment Partnership (TTIP). She noted that momentum on the trade deal has already been slow, and the deal will likely be placed on the back burner for now. She also questioned Britain’s involvement in international trade going forward, during the two year transition period. Geary addressed a question on the possibility of delaying the trigger of Article 50. He does not believe there will be another General Election – leaving is a done deal and Article 50 will have to be triggered soon. Egan added that there is pressure to invoke Article 50, but also questioned what this will mean for parties such as Labor and the UK Independence Party (UKIP). Hollifield responded to a question on the impact immigration had on the result arguing that it played a large role but was not the only driving force. The UK could possibly strike a deal similar to Norway, wherein the free movement of people is a requirement to access the European Union’s Single Market. When asked how this will affect North America and the rest of the EU, Geary said it will be difficult to tell until after the enactment of Article 50. The UK may be used as a cautionary tale to dissuade other nations from leaving the bloc. Egan noted that since the United States had pushed for “Remain,” Brexit will affect relations. She also observed that the post-vote effects on the market should give other nations pause.