Is the EU project on the brink of irrelevance?
For seven years, Canada has been trying to find the EU’s evasive sweet spot of consensus on a bilateral trade deal. If CETA is rejected this week, is the EU good for anything anymore?
Former Ambassador to the European Union and High Commissioner to Britain
Back in the UK and Brussels recently for my first visit since the United Kingdom’s unexpected vote to pull out of the EU, I found nothing but buyers’ remorse among a score or so of experts, editors and diplomats in English circles.
These are, of course, the “elites” — the people whose advice a great many “ordinary” Britons are inclined to reject. But they’re the ones watching the deeper trends … and the trends are ominous.
Since nothing has actually happened yet on the Brexit front, consumer spending and the stock market are all pretty normal. But the pound has plunged, along with the re-investment plans of offshore investors’ who had seen the UK as a good platform from which to access the vast EU market of half a billion people.
Actually, the ‘Brexit’ decision of June 23 has been digested by the EU’s remaining members. Apart from Ireland — which will take a devastating hit because of its interdependence with the UK — the others are pretty serene, being vastly less dependent on Britain in trade and economic terms than Britain is on the rest of Europe.
The EU wants it over with and isn’t prepared to make any particular offers to the UK. The view on the continent is that the EU hasn’t done anything to force this outcome, so it’s up to the UK to formulate its exit demands.
It has since dawned on government personnel in London that this does, in fact, mean what it seems to mean — that the UK will have to exit the single EU market. The dominant message in the Brexit campaign was about immigration of EU workers. But free movement of EU labour is indivisibly linked to the free movement of goods, services and capital in the single EU market. So Britain is going to be out — completely.
Despite its public air of bravado, the government of Prime Minister Theresa May is at a loss as to what the exit actually means, and where to go next. The hardliners’ seeming preference for a ‘hard Brexit’ — for taking the immediate costs to the economy, to financial services and the Treasury, on the chin — makes it clear that their motives never had anything to do with economics. They weren’t really about EU immigrants either — now acknowledged as necessary to the UK economy. Nor were they about globalization — though large pockets of people have bought into the facile and fashionable fable it’s been a bad thing for ordinary working Brits.
Brexit was primarily driven by anxiety over the health of a largely mythical English identity, fuelled by a generalized resentment of rapid change. It became channeled through the populist message of getting “control” again — over borders, law-making, sovereignty — and taking the agenda away from “elites”. It represents a return to the sort of nationalism that post-war Europe had sought to bury. Marine LePen loves it.
But the costs of nativism and nostalgia are going to be real. Younger people, who feel a greater openness to a future in Europe, see their ambitions being shelved by older people who won’t be around much longer. They won’t be happy living in a country turning inward, becoming smaller.
Attempts to define in a positive and compensating way a notion of some “global Britain” are weakened by an ominous decline in the resources needed to take on anything other than managing Brexit itself for the next decade. And then there’s Scotland, ready to bolt the UK if the economic numbers permit it. Politically, the UK’s Conservative government ought to be running scared. But seeing the mess that Labour’s in, they carry on, insouciant, as if they knew what they’re doing. They don’t.
Over in Brussels, there is a competing sense of unreality. Instead of getting the EU’s act together in Brexit’s wake, fear of the nativist contagion that caused this mess has intimidated many of the now unpopular top Eurocrats. Even though polls show that support for the EU is up since Brexit, the instinct in Brussels is to defer to each and every surge of populist and nationalist pushback as a sort of substitute for the real reform everybody knows is necessary — but which is so hard to fashion when fateful big national elections are right around the corner.
The admirably forward-looking Canada-EU economic treaty (CETA) is looking like roadkill. Despite eloquent interventions by people like Quebec’s CETA negotiator Pierre-Marc Johnson — who said that singling Canada and Quebec out for the imagined ills of the international corporate world is insane — the Walloon regional parliament, largely representing the long-standing grievances of local losers who resent general EU prosperity, has flaunted the improbable veto it holds under Belgium’s patched-together constitution.
It’s a way of sticking it to the rival Flemish community in Belgium that has done vastly better since Wallonie’s dominant days a century ago. It too is prompted by the kind of populist fantasies about globalization’s dire effects that fit the Trump campaign to a T.
Even if the renegade Walloon protest veto can be appeased, Romania still wants to block CETA unless Canadian visas are dropped. The president of the EU Council, Donald Tusk, told Prime Minister Justin Trudeau on the phone, “You have a problem.” The PM told Tusk, “No, actually you do” — and reminded him that Romania’s EU partners won’t open their own borders to Romanians for the same reasons that Canada has had to impose visas (which, Trudeau says, we shall drop in 18 months if all goes well on the Roma files; Canada has dispatched dozens of officials to Romania and Bulgaria to help them construct the information systems we require for visa-free entry).
Trudeau added that Canada’s record on inclusivity and managing pluralism is the hallmark of our society, a fairly decent contrast to the struggles over refugee integration happening in Europe. A week ago, I saw dozens of Roma women sleeping on Paris sidewalks with babies and tots. Desperation of a persecuted people or an escalation in begging technique? Unseeing Parisians stepped around them, as intimidated French social services stepped back from their duty to protect the children.
Of course, Tusk knows that if the EU can’t conclude a far-seeing and creative economic pact with Canada — the arbitration features of which already have been diluted by Trade Minister Chrystia Freeland and her competent EU colleague to diminish fears of a corporate heavy hand — then the EU isn’t really up to much of anything anymore.
Going back to our first trade mission to cut a deal with the six-member Common Market in 1972, Canada and Europe — the EU and its predecessors — have been at this a long time, trying to find the EU’s evasive sweet spot of consensus. If CETA has to wait a while longer, it shouldn’t matter … in theory.
But the political fallout will be very demotivating. There will be costs to the EU project when it can least afford them. As the U.S. spirals to the side with its fabricated antagonisms, the world needs more EU, not less.
It’s a crisis. Let’s hope the EU can again lift its game to meet it, and fast.
This piece first appeared on iPolitics.