Brexited… Now What Should Europe Do?

Brexit Europe VisionAfter the surprising BREXIT vote by the people of the United Kingdom last Thursday, we have since certainly all been involved in heated debates regarding this topic. Amongst my Parisian friends, the conversation kept coming back to the English. And like in the “Journal du Dimanche”, the first two pages of a dedicated BREXIT segment were entirely focused on the UK.

The reactions on the continent have revolved around: the British are going to suffer; they are crazy; they do not understand the consequences; they are racist … But, I think, in these expressions, Europeans are mistaken in their conclusion. It would be better not to act as a jilted lover.

I personally feel more European than French (naturalized citizen). And, I think that Europe has a unique opportunity in this moment and must act resolutely.

Another friend opined that she was scared of what it meant. Here, I want to say that we need to move from fear into action.

In this context, I felt the urge to pen my point of view.

My advice to pro-Europeans: do not focus on the UK and the impact on them. Certainly, the reasons that motivated the vote are distressing; certainly, the UK may see the pound weakened and their economy struggle … but the real issue is:

 What to make of Europe?

brexit chinese-symbol-for-crisisAs the Chinese* would say: in any crisis, there is danger and opportunity. The requirement on the European side is not to draw up the best retribution possible against the Brits, but instead to focus its energies to find its own way and take care of itself. Angela Merkel rightly said: “Do not make fast conclusions about the British decision…”

Europe needs to understand – in a deeper way – why the Brexit vote happened. Sure, it was the 50+ year-old lesser educated English person who voted LEAVE in a bid to restore British sovereignty. But, in reality, the problem is that the British have not found enough reason to belong to Europe. Nicolas Sarkozy, for whatever he may be worth, is right in saying, “The British are gone: it’s their choice. We must now act fast and strong. “(JDD p6).

The risks

The three biggest risks BREXIT poses for Europe are:

  1. A wave of nationalism takes over Europe (e.g. France, Austria, the Netherlands…), driven by fear of immigration and a need to regain lost national pride. We should keep a beady eye on the presidential elections in France and Germany next year. And one should not forget the risk (and the need for a robust response by Europe and the US) of the resurgent near-despotic Russian nationalism.
  2. The European economy does not reboot, leaving an unhealthy level of unemployment, the younger generations in a precarious position and a stagnant intra-European movement of population. Note: the destabilizing effects of a non-harmonized tax system and uncoordinated state expenditures render the Euro currency totally flawed.
  3. That the people in European countries feel increasingly trapped in a Europe in which they do not recognize themselves; and, do not find a net benefit versus the apparent cost. So we’re bound to see other European countries embark on their own EXIT. We are already talking about similar votes in several countries. This all points to the fact that a strong anti-European sentiment existed well before the vote in the UK.

The stakes are high and the risks are real. But, it is important to stress that they existed before the BREXIT vote. In fact, these topics were fully discussed before; but, the 28 members at the table were nowhere near finding a solution, stuck in endemic bureaucracy and consensual decision-making. The problem is that nobody (in Brussels, in particular) has ever felt enough urgency. It’s like running a business with an over-populated Executive Committee. An ExCom of 28 27 people is just unmanageable.

The Opportunities

The opportunities for Europe – or even unintended consequences – are:

  1. To define the vision (aka its NORTH) of Europe, something that could be made easier without the presence and the nit-picky point of view of the English. Firstly, one would have to imagine a future in which Europe has a definite place in the world, and with which members can identify themselves. Secondly, we should agree on the de facto shared values. To date, neither the vision nor the common values are clear.

    brexit ideal europe

    The Ideal House by Claude Nicolas Ledoux, 1770

  2. To address how to mobilize the European economy from the inside – instead of focusing how to repulse or ensnare the new entrants (e.g. Google, Facebook and Alibaba); to encourage entrepreneurship and the free movement of people between countries; and to collaborate on strategic projects (not just Airbus). N.B. High taxation and bureaucracy are not favorable conditions for business.
  3. With a well-defined North, Brussels must be prepared and able to make tough decisions. For example: to clean Europe of members who do not play by the rules. Consensus – as a process – is not friendly with making difficult decisions.
  4. Not forgetting that if Europe acts appropriately, Scotland and Northern Ireland could decide to join the EU …

In the vision of the Europe of tomorrow, there is a need to identify one or more values that are held in common.* This must be an ideal and/or a behavioural trait that is shared de facto by the people living there. Europe needs to take decisive and joint action that demonstrates a clear ambition and that unites. One would need to streamline the decision-making in Brussels to become fleeter of foot. Will there ever be an alignment of tax policies and, even more complicated, over the role of the state (e.g., level of expenditures) within each country?

REDEFINING EUROPE

Although many repudiate the idea, Europe would perhaps need a real orchestral conductor. Is there an appetite on the part of citizens (and their governments) to give up more power and sovereignty to a meta-structure, with a European president? But, even imagining it were accepted, would there be a person up to the task? Angela Merkel would present the best (only?) option.

Many questions and concerns. But these issues should have been debated and resolved much earlier. Now, it’s time to take the bull by the horns.

WHAT IF BREXIT WERE THE RIGHT DECISION … FOR EUROPE?

Brexit or Breaks It

If, as a result of the UK’s decision, Europe undertakes radical changes that will ensure the future of Europe, BREXIT would have had a happy unexpected intention: Europe will have received the necessary kick in the butt to provoke the change. But, if Europe implodes, this would indicate that the UK had good reason to withdraw. Perhaps, the UK’s departure will be the straw that breaks the camel’s back, but, in my opinion, the proverbial camel was already heavily overloaded.

Either way, I maintain that Brexiting was the right decision, even if the reasoning that underpinned this vote were unfortunate.

As a first (small) act of the new Europe: At the time of Euro 2016, I would propose to create a European team for each sport (not just golf)!

Europe: Now’s the time for us to act together!

* Although the United States are far from exemplary on many points, there exists a common shared value – across the 50 states – a fundamental belief: every individual has the right to build his/her own future. This kind of shared value binds and transcends all the American people. May the EU find its own!

 

*My friend, Takuya san, pointed out that the ideogram I had originally posted was wrong (it meant “storm wind”). So, I have replaced it with the correct characters! Arigato Takuya san!

PS Here was the post I wrote before the Brexit vote.

Is There A Win-Win Case In The Brexit Vote?

brexit euro 2016Isn’t it ironic that the BREXIT vote is happening in the midst of Euro 2016? With good fortune (or planning?), there are no matches on Thursday 23rd. I am not particularly fond of football, but I feel like such tournaments are the best way to get out our atavistic nationalistic tendencies. May they remain there.

I have lived two-thirds of my life in Europe. I love Europe. I love Europe for its diversity of food and language; for its culture and history; for its proximity; for having the Alps and the Mediterranean; and much more. And, yet for Europe, I believe a BREXIT Leave vote will be best. Here’s why.

BREXIT – Business Angle: Short or Long-Term?

Taking the viewpoint of businesses in the Brexit debate, I have to state that there is little incentive for the UK to bust out of Europe. Businesses in general, and the stock market, in particular, do not like uncertainty. However, those vying to Remain based on financial matters, are doing so with no better assurances than those clamouring to leave. The difference is that the Remain camp is focusing on the negative shorter-term impact, while the other (leave) camp is more concerned about the longer-term impact.

Brexit Euro 2016

Obviously, no one knows for sure what would happen if Brexit goes through, except to say that it will cause a distinct amount of chaos. We know that there will be a major impact with the mobilisation of resources to reorganise (adjusting the legal and constitutional framework, redefining European political and trade relationships…). Another major thorny issue: what to do with the 3 million EU nationals living, working and/or studying in the UK, or the 2 million UK nationals spread throughout the EU?

Remain = Status Quo

Yet, to remain is to accept the status quo. Things I personally appreciate about the EU include the ability to travel without having to change monies or get visas and/or my passport stamped every time I cross a border. As a French national, I have the opportunity to settle wherever I would wish in Europe. Last but not least: the general peace Europe has enjoyed, regardless of the gross misfortune of the radical Islamic terrorism.

The one thing of which we do have a better understanding is if Europe stays as is, i.e. the UK votes to remain. Pretty much everyone everywhere knows that Europe is sickly. Even on the Remain camp, there are many who agree. What does the future hold with Europe continuing with the status quo?

Europe is ill

Europe is suffering on many layers, not least of which is its economic health. The European economy is systemically handicapped. The list of illnesses range from the systemic to the temporary to the cultural. The list of problems includes (but not limited to):

  1. the lack of fiscal harmony
  2. the hideously bureaucratic (and consensual) decision-making process in Brussels
  3. the lack of a harmonised vision of Europe across the 28 member countries of the EU
  4. the legacy feelings of entitlement
  5. the continuing divisions within the countries (Catalonia in Spain, Flemish in Belgium, Scotland in Britain, and an enormous laundry list of other active separatist or autonomy movements in Europe courtesy of Wikipedia)
  6. the risk of further pollutive immigration from the IS ranks

A chief argument for the Remain camp is that it will be easier to change from within… But, change hasn’t exactly been easy to forge in the past (especially over the first sixteen years since the introduction of the Euro). The UK’s half-wedded status has perhaps not helped them or Europe in this regard. Why will remaining in the EU mean that change will come any faster or better considering the poor record?

Vote for Radical Change?

My personal opinion underlying my position on the Brexit vote is that Europe needs to find a way to heal, and to do so quickly. I don’t believe gradual change will be good enough. In a democratic and consensual process, any change has been laborious to push through. Europe needs a real wake-up call to understand that staying as is will be like the proverbial frog in the (gradually) boiling pot. If a Brexit Leave vote will be painful for Europe, it will certainly be more painful for the UK, at least shorter term. But short of a Brexit, I do not see how or why Europe will take the necessary and hard decisions that need to happen to fix it. For this reason,

It won’t be pretty, but it would provide the best chance of forcing Europe’s hand to bring about necessary radical reform. Staying “within” will mean that any such change will come only with major compromises that bring Europe down to its lowest common denominator. Given the obvious stresses that the immigration issue will continue to provoke, much less the continuing slide of the European continuing faced against much more competitive players, Europe in its current incarnation seems destined to hit the wall.

I thus support Boris Johnson and Michael Gove.

Your thoughts and reactions are welcome.