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Post-Brexit, the U.K. is in its worst political crisis since 1940

- June 29, 2016

On June 23, 2016, Britain voted to leave the European Union. With a much higher than expected turnout of 72 percent, close to 52 percent of the electorate voted to leave, while just over 48 percent voted to remain. The referendum fundamentally divided the country. London, Scotland, and Northern Ireland overwhelmingly voted to maintain the status quo, while the Welsh and especially the rest of England voted in large numbers to break with Brussels. The vote also showed large gaps between young and old, rich and poor, more and less educated, more and less well-traveled, as well as urban and rural. The former consistently sided with remain while the latter systematically favored leaving.

The vote left the United Kingdom, the rest of Europe and the world behind in a state of bewilderment. International financial markets went into a tailspin, wiping out close to $3 trillion in global wealth in just two trading sessions. The day after the vote — June 24 — was the worst day in global equity markets since the market collapse in September 2008 that followed the failure of Lehman Brothers. Britain’s currency, the pound sterling, crashed to its lowest level vis-à-vis the dollar since 1985. Prime Minister David Cameron, who had renegotiated Britain’s terms with the E.U. and headed the ‘remain’ campaign, announced that he planned to resign.

How can we make sense of it all?

The vote has left U.K. politics in its deepest crisis since World War II

While the “people have spoken” in favor of leaving, three-quarters of the members of the House of Commons want to remain in the E.U., suggesting that the current parliament is vastly out of touch with the people it claims to represent.

The Conservative Party’s next leader is likely to be either former London Mayor Boris Johnson or current Home Secretary Theresa May. Boris Johnson, who many expect was a closet “remainer,” given his cosmopolitan outlook and embrace of economic openness and globalization, opportunistically chose to put his weight behind the “leave” camp. Theresa May deliberately kept a low profile during the campaign and focused on her job, even though she loyally supported David Cameron’s “remain” camp despite her well-known Eurosceptic leanings.

To choose a new Conservative Party leader, who would also serve as Britain’s next prime minister, Tory members of Parliament (MPs) have to agree on a short list of two, probably over the coming two weeks. Then the 150,000 or so party members will get to decide between the two finalists, after an internal campaign that will probably last about six weeks.

As May and Johnson jostle for the position, they will likely offer competing views on what a post-Brexit E.U. looks like, and what model — Norway, Switzerland, Turkey, Canada, or Singapore and Hong Kong — to follow in how the country relates to the E.U. in the future. Meanwhile, recent Google searches for “how to join the Conservative Party” have skyrocketed, suggesting that the contest will be unpredictable.

The Labour Party has similarly been thrown into turmoil as their left-wing leader, Jeremy Corbyn, faces an internal party revolt. Corbyn supported the “remain” campaign in the most lukewarm way possible, publicly saying that his support for the E.U. was about a 7 out of 10.

After the results came in, many of his MPs blamed him for the large shares of “leave” voters in many of Labour’s traditional working class constituencies, as many voters were unclear as to whether Corbyn supported in or out. Just four days after the referendum, 172 of Corbyn’s 229 MPs outright rejected him in a no-confidence vote; only 40 MPs voted in support while 13 MPs did not vote.

But replacing him will prove hard, especially if he keeps his vow to fight on, as Labour’s rules consider such a vote to be nonbinding. In the meanwhile, Corbyn remains very popular among Labour’s grassroots members, who are the ones who actually decide on a new leader. In September 2015, he got a solid mandate from 61 percent of Labour members, in a four-way race that was a stinging rejection of the Party’s establishment, including Tony Blair and Gordon Brown.

With a leaderless government and a rudderless opposition, the U.K. would ordinarily expect a new general election. But given their current states of chaos, it would be hard to believe that either Labour or Conservatives would want to go back to the ballot box so soon after the election of May 2015. Nor is it clear what party platform either would offer, as both are internally divided over European Union membership. That makes it difficult to imagine who would call for, or who could force, snap elections.

The Fixed Term Parliament Act of 2011 stipulates a fixed five-year term for every new government. There are only two ways to call a snap election. One way is for two-thirds of the sitting House to agree that “there shall be an early parliamentary election.” Another way is for parliament to call for a motion of no confidence in “Her Majesty’s Government” by simple majority, which then can only be reversed by a vote of confidence within the next 14 days. With an absolute — though slim majority of just 16 seats, the new Conservative leadership, expected in early September, would have to propose a “no confidence” motion in themselves.

But why would they? Keep in mind that a slim majority of current Conservative MPs opposes leaving the E.U. Many of their districts voted in large numbers for Brexit. These MPs are unlikely to favor early elections, lest they be unseated by a challenger from the right-wing nationalist U.K. Independence Party (UKIP), whose leader, Nigel Farage, was one of the main faces of the “leave” campaign.

In the meanwhile, Labour MPs feel in no position to go head-to-head with the Tories given the hapless leadership Jeremy Corbyn has provided thus far. Most MPs in traditional Labour constituencies, especially in the industrial north of England, also fear being unseated by a UKIP candidate or losing to a Tory. Furthermore, the Europe question cuts through the middle of both Conservative and Labour Parties, and is therefore an incredibly thorny issue to find common ground on in an election manifesto.

In short, the U.K. is in the midst of its worst political crisis since May 1940, when Winston Churchill replaced Neville Chamberlain to face the existential threat of Nazi Germany after the fall of France.

Brexit may undo the United Kingdom

The first casualty of the Brexit vote will probably be the union among England, Wales, Scotland and Northern Ireland, rather than the European Union itself. While England and Wales voted “out” by a margin of 53-47, Scotland voted to stay in the EU by 62 to 38 and Northern Ireland by 56 to 44.

Scotland held an independence referendum in September 2014, and 55 percent voted to stay in a United Kingdom that was a full-fledged member of the European Union. Many of those voters now feel betrayed by what they see as an English “Brexit” vote.

Nicola Sturgeon, first minister of Scotland (the Scottish equivalent of a prime minister) and head of the Scottish National Party (SNP), has set in motion the legal process to trigger a second independence referendum within the next two years, which she hopes will allow Scotland to stay in the European Union. Guy Verhofstadt, the Belgian leader of the Liberal faction in the European Parliament, has already extended an invitation to Sturgeon over Twitter to discuss the idea in Brussels, which she eagerly accepted. She also suggested that the members of the Scottish Parliament at Holyrood in Edinburgh could simply veto a Brexit.

Meanwhile, in Northern Ireland, Martin McGuinness and Gerry Adams of Sinn Féin have called for a border poll on a united Ireland. The possibility of a border poll is a central provision of the Good Friday Agreement, which brought peace to Northern Ireland after decades of violent conflict. The U.K. government’s Northern Ireland Secretary has the power to call a poll on whether Northern Ireland should remain a part of the U.K. or should unite with the Republic of Ireland.

Just like the SNP in Scotland, Sinn Féin argues that Brexit is a “political and economic game changer.” An open border and free mobility of labor between Ireland and Northern Ireland, as well as E.U. membership for both parts of the island, were cornerstones of the 1998 peace agreement brokered by, among others, Tony Blair and Bill Clinton. In short, the Brexit vote may also set off an unintended flare-up of the bitter old conflict in Northern Ireland between pro-Dublin Catholic Republicans and pro-London Protestant Unionists.

One result of Brexit therefore may be to reduce the United Kingdom of Great Britain and Northern Ireland to the “Untied Kingdom of Little England and Wales.”

Referendums expose democratic dysfunction

Political scientists have always differed on the democratic merits of holding a referendum. There have been many arguments either on the merits or the costs of referendums for both democratic process and outcome reasons. The Brexit vote reveals that a referendum on a controversial policy decision can divide a country, laying bare deep social fissures, especially along age, class, ethnic and geographic lines. The Brexit vote has also revealed that the House of Commons and most of the British economic and financial establishment are profoundly out of touch with the rest of the country they govern and control.

The more disturbing revelation is that the “leave” campaign was able to win based on a series of inaccurate statements about the E.U., outright lies about the actual cost of Brexit, false promises on the country’s post-Brexit future and overtly racist attitudes against immigration.

In my book “Ideas and Economic Crises in Britain from Attlee to Blair,” which built on the work of Sheri Berman, Mark Blyth, Colin Hay, and Kate McNamara, I argued that some ideas prevail because they can give a convincing and simplified solution to perceived problems, not necessarily because they are inherently superior. Constructing a coherent and persuasive narrative of what went wrong, who is to blame and how things will get better plays a key role in winning elections. Political scientists need to better account for ideas and identity as we model voter behavior.

Referendums are hard to undo. The E.U. does have something of a tradition of letting countries vote again if they got it wrong the first time. Even though this happened previously in the cases of Denmark and Ireland — when a new E.U. treaty was rejected and then renegotiated with the member state in question — this may not be politically feasible this time. The U.K., after all, voted to leave the E.U. altogether.

When Britain signed the Lisbon Treaty of the E.U., which came into effect in November 2009, it also agreed to the procedure of leaving the union, as stipulated in Article 50. This procedure gives two years to negotiate the terms of the divorce. However, the member state that wants to leave is the only entity that can trigger those Article 50 proceedings. The rest of Europe cannot force the U.K. to do so. Some have suggested that the U.K. may never do so, as the legal way for renegotiating and a second referendum is wide open. Angela Merkel has said she can’t speed up or slow down Brexit talks. The E.U. could be in limbo for months.

David Cameron says he will leave it up to his successor to decide when to invoke the article and start the painful process of leaving the E.U. Boris Johnson, still his most likely successor, is already appearing to backpedal. He has said he hopes not to trigger Article 50, but rather to negotiate an amicable divorce on Britain’s terms. The E.U. is unlikely to agree to that, with E.U. officials already dismissing it as a “pipe dream.” So the option of last resort would be to go back to the voters, have them reject an actual Brexit and hope the nightmare will go away.

But as I noted above, early elections are not a very attractive option for either the Conservative or the Labour Party. Of course, that may change. But right now, the referendum outcome has exposed the country’s democratic dysfunction.

Political scientists can no longer assume that European integration moves only in one direction

Political scientists’ views about European integration have traditionally divided into two camps: Ernst Haas’s “neo-functionalism” and Andrew Moravcsik’s “liberal inter-governmentalism.” The former school assumed that nations would see positive spillovers and positive feedback from initial economic cooperation and that this would lead to more integration in such areas as foreign and security policy, agriculture, the environment and judicial affairs — resulting in an ever-closer union. The latter school saw “grand bargains” pushing the E.U. forward based on the rational interests of the main interest groups in the most important member states. Further E.U. integration would be the sum total of those periodic bargains.

Both schools of thought believed the E.U. was gradually moving toward closer cooperation and eventually to some version of a United States of Europe. “Crises” were assumed to be the catalysts for major leaps forward. This argument was based on the belief of Jean Monnet — one of the E.U.’s founding fathers in the 1950s — that “Europe will be forged in crises, and will be the sum of the solutions adopted in those crises.”

Craig Parsons and I have argued in “The Future of the Euro” that these theories were at best naïve and at worst dangerous. The belief, widely shared among elites, that “Europe always moves forward through crisis,” is reassuring to E.U. policymakers. It tells them that there is a silver lining to every crisis — more integration — that will eventually solve the problem. Parsons and I made the case that big steps forward in E.U. integration always happened when key heads of state – usually of France and Germany – got together in periods of relative calm and united around a common vision or idea on how to move the European project forward. Cumulative future crises could prove very damaging to the E.U. project, as they tend to create winners and losers. And the current Brexit crisis — with potentially disastrous effects on the euro zone’s integrity – could actually lead to the E.U.’s disintegration.

Political scientists have as of yet no useful theories to explain and understand the centrifugal forces of potential E.U. disintegration, having thus far paid less attention to how domestic politics, identity, class and culture affect this process. They therefore need to come up with new theories. Kate McNamara’s new book “The Politics of Everyday Europe does a great job explaining how the European Union has successfully managed to construct authority by transforming symbols and practices in everyday European life in a rather banal way. We now need to better understand the mainly national forces that are capable of undoing this process.

Brexit could prove devastating for the future of the United Kingdom, the future of the European Union and the future of the international liberal order. The latter has been the foundation of our postwar peace and prosperity, which many now realize is much more fragile than they had taken for granted.

Matthias Matthijs is assistant professor of international political economy at Johns Hopkins University’s School of Advanced International Studies (SAIS), author of “Ideas and Economic Crises in Britain from Attlee to Blair” (Routledge 2011) and co-editor (with Mark Blyth) of “The Future of the Euro” (OUP 2015).