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The United Kingdom’s paradise lost

Feb 01,2020 - Last updated at Feb 01,2020

PRINCETON — Goodbye, Britain. Brexit is done. It is over. Some Britons are waving Union Jacks, and public buildings are illuminated in red, white and blue. Having dramatically opened up a new space for political manoeuvre, the country is now celebrating its achievement.

This uplifting mood comes as a surprise. Following the June 2016 referendum, which “Leave” won by a relatively narrow margin (52 per cent to 48 per cent, with a 72 per cent turnout), Brexit became a deeply polarising issue. The bid to leave the European Union faced many legal challenges, and left Parliament bitterly divided and incapable of approving an exit deal. The public descended into acrimony. To observers around the world, it looked like the United Kingdom was disintegrating.

But then came the strong showing by Prime Minister Boris Johnson and the Conservatives in the December 2019 general election, which many interpreted as a “landslide”, an epic shift in the country’s political orientation. Although the Tories actually won only 44 per cent of the vote, with turnout at 67 per cent, we are told that the country has undergone a profound psychological transformation. The sudden emergence of a new consensus, we are told, resolved the issue.

Insofar as there has been a shift in public opinion, it may simply reflect frustration after more than three years of debating Brexit. Appealing to this sense of exhaustion, the Tories campaigned on a straightforward platform: “Get Brexit done.” The simplicity of that slogan belies the mind-numbing complexity of the questions that remain unanswered. Will the future trading relationship with the EU include services? Will a doctrine of “equivalence” preserve UK-based financial institutions’ access to the continent? And how will the Irish border be managed?

But, of course, the shift in public mood also may reflect a genuine desire to shake off the constraints associated with EU membership. After years of Remainers arguing that leaving the EU would create incalculable economic risks, Johnson held out the promise of finally overcoming “Project Fear”.

Since the 1970s, the British debate about Europe has pitted those focused on the economic benefits of integration against those worried about political sovereignty and encroachments by remote supranational authorities. This served to frame the issue as one of economic necessity versus political choice.

Prime minister Margaret Thatcher, however, managed to stand on both sides of the divide. She had campaigned vigorously for UK membership in the European Economic Community, and her government played a decisive role in pushing through the 1986 Single European Act, which took Europe in a free-market direction. Until German Chancellor Angela Merkel arrived on the scene, Thatcher was the best-known proponent of the view that “there is no alternative” (TINA) to economic integration.

And yet, Thatcher also argued consistently about the need for choice, and increasingly depicted Europe as a “superstate” that threatened to restrict national sovereignty, as exercised through regular parliamentary processes. In a 1988 speech at the College of Europe in Bruges, she rejected “collectivism and corporatism at the European level”, even while maintaining the view that Britain’s “destiny is in Europe, as part of the Community”.

After the 2008 global financial crisis, and especially after the European debt crisis, the problems with TINA came to the fore. Large-scale public expenditures financed by fiscal and current-account deficits had become an obvious source of vulnerability. External funding dried up, and governments pursued austerity, which they presented as necessary to restore business confidence.

Politically, this message failed. Severe cuts to welfare benefits produced many victims and revived the old complaint about a lack of choice. After 2012, a new narrative began to take hold, facilitated in large part by monetary easing, which was making it easier and cheaper to borrow. Under these circumstances, large-scale public expenditures could actually be stabilising, because governments that issued their own currency would never default. But in the case of the EU, there was no European-level governance mechanism capable of reaping the benefits of cheap money.

Against this backdrop, the Johnson government has recast the economic argument about the absence of choice. Exploiting the destructive and demoralising effects of “austerity”, it has promised massive public investments to galvanise and transform the declining northern industrial areas that voted for Brexit and fueled the Conservatives’ victory in December. This increased spending will supposedly lead to social harmony, because it will restore a sense of free choice. Or, as Johnson famously said of Brexit, “We’ll have our cake and eat it.”

In reimagining itself, the UK is now acting as if it has entered a world of new, attractive alternatives. The freedom to choose means that Britain is indeed free. At some point, though, it will become clear that, as with all choices, there are tradeoffs. To choose one option is to eschew many others, and any choice can have far-reaching implications for the range of future choices.

Brexit may have lifted the national mood for now. But sooner or later, hard economic realities will reassert themselves. John Milton’s description of Adam and Eve after their expulsion from the Garden of Eden has seldom seemed more apropos:

“The World was all before them, where to choose

Thir place of rest, and Providence thir guide:

They hand in hand with wandring steps and slow,

Through Eden took thir solitarie way.”


Harold James is professor of History and International Affairs at Princeton University and a senior fellow at the Centre for International Governance Innovation. A specialist on German economic history and on globalisation, he is a co-author of the new book “The Euro and The Battle of Ideas”, and the author of “The Creation and Destruction of Value: The Globalisation Cycle”, “Krupp: A History of the Legendary German Firm”, and “Making the European Monetary Union”. ©Project Syndicate, 2020.

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