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To Brexit Or Regrexit? A Dis-United Kingdom Ponders Turmoil Of EU Divorce

To leave, or not to leave: that is the question. Still.

After Britain’s historic vote to leave the European Union, there is no indication that a so-called Brexit will happen soon. It maybe never will.

Prime Minister David Cameron, who is resigning, has said he will not take the formal step to an EU divorce on the grounds that his successor should. Because the referendum is not legally-binding, some politicians are suggesting a parliament vote before formally triggering Brexit.

A petition on the UK government’s website on holding a second referendum has gained more than 3 million signatories in just two days.

European leaders, facing the biggest threat to European unity since World War Two, are divided over how swiftly divorce talks should start. Paris wants haste and German Chancellor Angela Merkel is urging patience. European Commission President Jean-Claude Juncker said he wanted to “start immediately”.

And on Sunday, Scotland’s leader said Scotland may veto Brexit altogether. Under devolution rules, the parliaments of Scotland, Northern Ireland and Wales are required to consent to any EU divorce, according to a report by the House of Lords.

Most British politicians agree such a decisive 52-48 win for Leave in the referendum means a divorce must happen. Anything less would be a slap in the face of democracy.

“The will of the British people is an instruction that must be delivered,” a choking Cameron said in his resignation speech, which marked the most tumultuous end to a British premiership since Anthony Eden resigned in 1957 after the Suez crisis.

Still, the upswell of chatter – #regrexit is trending big on twitter – over whether Britain might be able to reconsider speaks to the disbelief gripping this continent in the wake of a vote that has unleashed financial and political mayhem.

Sterling has plunged, and Britain’s political parties are both crippled. Cameron is a lameduck leader, and the main opposition Labour party on Sunday attempted a coup against its leader, with nine top officials resigning.

“The kaleidoscope has been shaken up not just in terms of our relationship with the EU but in terms of who runs our parties, who governs the country and what the country is made up of,” said Anand Menon, Professor of European Politics and Foreign Affairs at King’s College London.

“It is very hard to see where the pieces are.”

 

ARTICLE 50

The law provisioning an EU member country’s exit from the union is Article 50 of the Lisbon Treaty that is effectively the EU’s constitution. It has never been invoked before.

Before the vote, Cameron had said Article 50 would be triggered straight away if Britain voted to leave. Over the weekend, several EU officials also said the UK needed to formally split right away – possibly at a Tuesday EU meeting.

But officials of the Leave campaign – including former London mayor Boris Johnson – are stepping on the brakes. They say they want to negotiate Britain’s post-Brexit relationship with the EU before formally pulling the trigger to divorce.

European officials and observers say such a deal is unlikely, especially considering the thorny issues involved.

For example, it is unlikely that the EU would grant Britain access to the single market – key to allowing Britain trade goods and services in the EU – without London accepting the free movement of EU workers. But the biggest issue for those who voted to leave the bloc was limits on immigration – something the Leave campaigners promised.

 

DIVIDED UK

On Sunday, a petition to call for a second referendum was gaining supporters, reaching 3.3 million signatories by the afternoon. David Lammy, a lawmaker for the opposition Labour Party, said it was within parliament’s powers to call a second referendum and urged that it be done.

Perhaps the most vocal resistance to a British exit is coming from Scotland.

Scotland, a nation of five million people, voted to stay in the EU by 62 to 38 percent, compared to the 54 percent in England who voted to leave.

Under the United Kingdom’s complex arrangements to devolve some powers to Scotland, Wales and Northern Ireland, legislation generated in London to set off an EU divorce would have to gain consent from the three devolved parliaments, according to a report by the House of Lords’ European Union Committee.

Scottish First Minister Nicola Sturgeon told the BBC on Sunday that she would consider urging the Scottish parliament to block such a motion. It is not clear, however, whether such a scenario would ever materialize or be binding. Sturgeon’s spokesman later said that the British government might not seek consent in the first place.

Moreover, Sturgeon is simply laying out the groundwork for a new referendum on Scottish independence from the United Kingdom –something the first minister said was “highly likely.”

 

WITHDRAWAL

While there is no precedent for Article 50, the House of Lords has discussed how any Brexit would work. In May, it published a report after consultations with legal experts.

In the report, Derrick Wyatt, one of the professors involved, said that while it would be politically difficult, the law allows the UK to change its mind after invoking Article 50.

“In law, the UK could change its mind before withdrawal from the EU and decide to stay in after all,” said Wyatt.

 

(Editing by Alessandra Galloni)

Photo: A woman holds a sign in Westminster, in central London, Britain June 24, 2016.     REUTERS/Phil Noble 

Britain Votes To Leave The European Union

This article was last updated on June 24, 8:45 AM EDT.

By Guy Faulconbridge and Kate Holton

LONDON (Reuters) – Britain voted to leave the European Union, forcing the resignation of Prime Minister David Cameron and dealing the biggest blow to the European project of greater unity since World War Two.

Global financial markets plunged on Friday as results from a referendum showed a 52-48 percent victory for the campaign to leave a bloc Britain joined more than 40 years ago.

The pound fell as much as 10 percent against the dollar to touch levels last seen in 1985, on fears the decision could hit investment in the world’s fifth-largest economy, threaten London’s role as a global financial capital and usher in months of political uncertainty.

World stocks headed for one of the biggest slumps on record, and billions of dollars were wiped off the value of European companies. Britain’s big banks took a $130 billion battering, with Lloyds and Barclays falling as much as 30 percent at the opening of trade.

The United Kingdom itself could now break apart, with the leader of Scotland – where nearly two-thirds of voters wanted to stay in the EU – saying a new referendum on independence from the rest of Britain was “highly likely”.

An emotional Cameron, who led the “Remain” campaign to defeat, losing the gamble he took when he called the referendum three years ago, said he would leave office by October.

“The British people have made the very clear decision to take a different path and as such I think the country requires fresh leadership to take it in this direction,” he said in a televised address outside his residence.

“I do not think it would be right for me to be the captain that steers our country to its next destination,” he added, choking back tears before walking back through 10 Downing Street’s black door with his arm around his wife Samantha.

Quitting the EU could cost Britain access to the EU’s trade barrier-free single market and means it must seek new trade accords with countries around the world.

The EU for its part will be economically and politically damaged, facing the departure of a member with its biggest financial center, a U.N. Security Council veto, a powerful army and nuclear weapons. In one go, the bloc will lose around a sixth of its economic output.

“It’s an explosive shock. At stake is the break up pure and simple of the union,” French Prime Minister Manuel Valls said. “Now is the time to invent another Europe.”

The result emboldened eurosceptics in other member states, with French National Front leader Marine Le Pen and Dutch far-right leader Geert Wilders demanding their countries also hold referendums. Le Pen changed her Twitter profile picture to a Union Jack and declared “Victory for freedom!”

The vote will initiate at least two years of divorce proceedings with the EU, the first exit by any member state. Cameron – who has been premier for six years and called the referendum in a bid to head off pressure from domestic eurosceptics – said it would be up to his successor to formally start the exit process.

His Conservative Party rival Boris Johnson, the former London mayor who became the most recognizable face of the “Leave” camp, is now widely tipped to seek his job.

Johnson left his home to jeers from a crowd in the mainly pro-EU capital. He spoke to reporters at Leave campaign headquarters, taking no questions on his personal ambitions.

“We can find our voice in the world again, a voice that is commensurate with the fifth-biggest economy on Earth,” he said.

‘INDEPENDENCE DAY’

There was euphoria among Britain’s eurosceptic forces, claiming a victory over the political establishment, big business and foreign leaders including U.S. President Barack Obama who had urged Britain to stay in.

“Let June 23 go down in our history as our independence day,” said Nigel Farage, leader of the eurosceptic UK Independence Party, describing the EU as “doomed” and “dying”.

On the continent, politicians reacted with dismay.

“It looks like a sad day for Europe and Britain,” said German foreign minister Frank-Walter Steinmeier. His boss Angela Merkel invited the French and Italian leaders to Berlin to discuss future steps.

The shock hits a European bloc already reeling from a euro zone debt crisis, unprecedented mass migration and confrontation with Russia over Ukraine. Anti-immigrant and anti-EU political parties have been surging across the continent, loosening the grip of the center-left and center-right establishment that has governed Europe for generations.

U.S. presidential candidate Donald Trump, whose own rise has been fueled by similar disenchantment with the political establishment, called the vote a “great thing”. Britons “took back control of their country”, he said in Scotland where he was opening a golf resort. He criticized Obama for telling Britons how to vote, and drew a comparison with his own campaign.

“I see a big parallel,” he said. “People want to take their country back.”

American Vice President Joe Biden said the United States would have preferred Britain to remain in the EU, but respected the decision.

Britain has always been ambivalent about its relations with the rest of post-war Europe. A firm supporter of free trade, tearing down internal economic barriers and expanding the EU to take in ex-communist eastern states, it opted out of joining the euro single currency or the Schengen border-free zone.

Cameron’s ruling Conservatives in particular have harbored a vocal anti-EU wing for generations, and it was partly to silence such figures that he called the referendum in 2013.

When he called the referendum, he thought it would be a sure thing. But the 11th hour decision of Johnson – a schoolmate from the same elite private boarding school – to come down on the side of Leave gave the exit campaign a credible voice.

Even until the last minute, bookmakers and financial markets had overwhelmingly predicted a Remain vote.

World leaders including Obama, Chinese President Xi Jinping, German Chancellor Angela Merkel, NATO and Commonwealth governments had all urged a “Remain” vote, saying Britain would be stronger and more influential in the EU than outside.

The four-month campaign was among the divisive ever waged in Britain, with accusations of lying and scare-mongering on both sides and rows over immigration which critics said at times unleashed overt racism.

It revealed deep splits in British society, with the pro-Brexit side drawing support from millions of voters who felt left behind by globalization and blamed EU immigration for low wages and stretched public services.

At the darkest hour, a pro-EU member of parliament was stabbed and shot to death in the street. The suspect later told a court his name was “Death to traitors, freedom for Britain”.

Older voters backed Brexit; the young mainly wanted to stay in. London and Scotland supported the EU, but wide swathes of middle England, which have not shared in the capital’s prosperity, voted to leave.

THREAT OF UK BREAK-UP

The United Kingdom itself now faces a threat to its survival. Scottish First Minister Nicola Sturgeon said it was “democratically unacceptable” for Scotland to be dragged out of the EU against its will.

“It is a statement of the obvious that the option of a second referendum must be on the table and it is on the table,” she told reporters, two years after Scots voted to stay in the United Kingdom. “I think an independence referendum is now highly likely.”

The global financial turmoil was the worst shock since the 2008 economic crisis, and comes at a time when interest rates around the world are already at or near zero, leaving policymakers without the usual tools to respond.

The body blow to global confidence could prevent the Federal Reserve from raising interest rates as planned this year, and might even provoke a new round of emergency policy easing from all major central banks, despite their limited options.

The Bank of England pledged a huge financial backstop to calm plunging markets. Governor Mark Carney said it was offering to provide more than 250 billion pounds ($347 billion) plus “substantial” foreign currency liquidity and it was ready to take additional measures if needed.

Other central banks around the globe also intervened in markets. The European Central Bank said it was ready to provide euro and foreign currency liquidity if necessary.

Left unclear is the relationship Britain can negotiate with the EU once it leaves.

To retain access to the single market, vital for its giant financial services sector, London may have to adopt all EU regulation without having a say in its shaping, contribute to Brussels coffers, and continue to allow free movement as Norway and Switzerland do – all things the Leave campaign vowed to end.

EU officials have said UK-based banks and financial firms would lose automatic access to sell services across Europe if Britain ceased to apply the EU principles of free movement of goods, capital, services and people.

Huge questions also face the millions of British expatriates who live freely elsewhere in the bloc and enjoy equal access to health and other benefits, as well as millions of EU citizens who live and work in Britain.

(Additional reporting by William James, Kylie MacLellan, Sarah Young, Alistair Smout, Costas Pitas, Andy Bruce and David Milliken; Writing by Mark John and Pravin Char; Editing by Peter Graff)

In The Shadow Of A Murder, Britain To Vote On EU Membership

Britons will shape the future of the United Kingdom and Europe on Thursday when they decide whether to stay in the European Union following a campaign that has shown the potency of anti-establishment feeling in the West.

The vote comes a week after the murder of a lawmaker in the street left many voters wondering whether the campaign rhetoric on both sides – warnings of economic disaster versus uncontrolled immigration — had gone too far in a country considered a paragon of stability.

Whatever the outcome, the referendum could force the EU to rethink how it governs 500 million citizens and – along with the rise of Donald Trump in the United States – have far-reaching implications for the future configuration of the West.

Allies such as U.S. President Barack Obama and German Chancellor Angela Merkel have implored Britain to stay in the bloc, which they say has given Europe decades of prosperity after centuries of bloodshed.

Investors, chief executives and central bankers are bracing for what could be one of the most volatile events for financial markets since, at least, the 2008 collapse of Lehman Brothers.

Prime Minister David Cameron, who promised the referendum in 2013 under pressure from euroskeptic lawmakers in his own party, has mixed rhetoric about his island nation’s history with dire warnings about the costs and dangers of a Brexit.

“This referendum has now become a watershed moment for our country,” Cameron said when campaigning resumed after a two-and-a-half-day suspension called as a sign of respect for lawmaker Jo Cox, who was shot and stabbed last week.

“There is no turning back if we leave,” he added, warning this would be “an abject and self-imposed humiliation” that would leave “a permanently poorer country in every sense”.

The murder of Cox, a 41-year-old mother of two young children who was an ardent supporter of EU membership, shocked the country and abruptly changed the tone of the caustic campaigning that has polarized the country.

Both sides have accused their opponents of misleading the public, and critics say the debate had descended into a negative row over the economic dangers of leaving versus the difficulties of limiting immigration if Britain stays.

Witnesses to the Cox attack said the accused, 52-year-old Thomas Mair, was heard saying “Britain first, keep Britain independent, Britain always comes first”. Such comments added to speculation the murder was politically-motivated, making it a potentially defining moment in the referendum.

Campaigners said events and leafleting would go ahead as planned this week, but the rhetoric would be scaled back.

“People are thinking carefully about the conduct of this campaign, perhaps taking a more respectful tone towards opponents,” said a “Stronger In” campaign source. Leave officials would not discuss the details of their campaign plans.

Voting begins at 0600 GMT on June 23 and closes at 2100. Results are due around 0000-0500 GMT the next day.

Opinion polls have painted a contradictory and volatile picture of British public opinion with Remain ahead for much of the campaign but Leave taking a late lead before the Cox murder.

A vote to leave could unleash turmoil on foreign exchange, equity and bond markets, lead to a political crisis in Britain and fragment the post-Cold War European order.

The EU would have to weather the exit of its No.2 economy representing $2.9 trillion of its gross domestic product, the only European financial capital to rival New York and one of its only two nuclear powers, while Britain’s economy could stall.

A vote to remain would trigger a rise in sterling and relief in Western capitals but would still leave Britain – and Cameron’s ruling Conservative Party – deeply divided.

WHAT KIND OF BRITAIN

The murder of Cox in the street of her own electoral district in northern England has shocked Britain, which has strict gun controls, and sparked soul-searching about a referendum which both sides admit is about much more than membership of the club it joined in 1973.

“The referendum was always about more than Europe; it was always about what kind of Britain we are and what we aspire to be,” former Prime Minister Gordon Brown, who is pro-membership, said in an article for the Guardian newspaper.

“But some have attempted to hijack a decision on the future of Britain in Europe and turn it into a vote on immigration, and then on immigrants and those who support immigrants.”

It was not clear what impact the killing would have on public opinion or even if pollsters, who failed to forecast Cameron’s decisive election victory, were reliable guides.

In the week before Cox’s murder, the Out campaign had developed a strong lead in opinion polls.

But a YouGov poll, for which a third of responses were gathered before news of the killing, showed support for staying in the EU had risen 5 percentage points to 44 percent while support for leaving had fallen 3 points to 43 percent.

“The underlying figures suggest the movement may be more to do with people worrying about the economic impact of leaving the European Union,” YouGov said.

Gisela Stuart, a Labour lawmaker who is helping to lead the main Leave campaign, urged politicians and voters to “reflect on the hate-filled language that too often scars our debates”.

“We must take care before assuming that anger turned up to maximum volume should be the default way to hold a political discussion,” said Stuart, who added that Britain had to take back control of its own laws.

THREAT TO EUROPE

Britain has been divided over its European destiny since it lost its empire and though it eventually joined the EU, it remained a reluctant member outside the core euro zone.

Leave campaigners have said Britain would prosper if it broke free from what they say is a doomed German-dominated bloc and a failed project in excessive debt-funded welfare spending that has usurped sovereignty from the people.

Boris Johnson, seen as a leading contender to replace Cameron as Conservative leader and prime minister, even contended that the bloc was following the path of Adolf Hitler and Napoleon by trying to create a European superstate.

“Napoleon, Hitler, various people tried this out, and it ends tragically,” Johnson said in a newspaper interview last month. “The EU is an attempt to do this by different methods. But fundamentally what is lacking is the eternal problem, which is that there is no underlying loyalty to the idea of Europe.”

But allies have warned that ditching a 60-year strategy of trying to hedge partial European participation with the U.S. alliance, for an uncertain future outside the world’s biggest trading bloc, would be a hammer blow to Britain’s economy and would shred what remains of its global clout.

Beyond British shores, an exit would pose a major threat to European integration.

While the collapse of the Berlin Wall in 1989 and the Soviet Union in 1991 spurred integration as the Cold War melted into the archives, a Brexit could unravel a union already grappling with differences over migration, the future of the euro zone and how to deal with Russian President Vladimir Putin.

“A vote to leave would shake the union,” German Foreign Minister Frank-Walter Steinmeier said. “It would not just carry on as 28 (members) minus one.”

“It would require concerted efforts to ensure that the union holds together and that a decades-long, successful integration effort does not end in disintegration,” he said.

Even if a Brexit didn’t unravel the EU, it would ensnare Brussels and London in years of complex negotiations that could lead to a decade of economic uncertainty while a Brexit would embolden euroskeptics in other member states to press for their own renegotiations and referendums.

Pro-Europeans, including former Prime Ministers Tony Blair and John Major, have warned an exit could trigger the break-up of the United Kingdom itself by undermining peace in Northern Ireland and bolstering the Scottish independence movement.

Scotland’s first minister, Nicola Sturgeon, told Reuters last week that the EU referendum was on a knife edge and that if England backs an exit that drags Scots out of the bloc against their will, Scotland may call a new vote on independence.

AFTER BREXIT

Despite Britain’s historical reticence concerning Europe, only 13 years ago its leaders were arguing about when to join the single currency and an EU exit was a far-fetched notion entertained only by skeptics on the fringes of major parties.

But the turmoil of the euro zone and migration crises, combined with growing anger at what many voters perceive as arrogant elites in London and Brussels, have driven demands for a Brexit.

Since the referendum was announced, companies from BP to Rolls-Royce, as well as international allies, have cautioned about the risks of leaving.

Some British leaders have questioned what sort of Britain would remain.

Washington has made clear that Germany would be its first ally of choice in Europe if Britain left. In the biggest intervention in the domestic affairs of a Western European ally since the Cold War, Obama warned in April that Britain would at “the back of the queue” for a U.S. trade deal if it left.

His comments chimed with warnings about the consequences of leaving from Bank of England chief Mark Carney, the City of London, U.S. investment banks and major trade unions.

But opponents of membership say such warnings about Brexit from global corporations and leaders have further fueled an anti-establishment wind that has grown in strength since the 2008 financial crisis.

“We are capturing that wind and I think it could be the thing which really drives us to victory,” Matthew Elliott, the head of Vote Leave, told Reuters last month.

“I wouldn’t see it as the wind of [presumptive Republican presidential nominee Donald] Trump – I think there is a much wider anti-establishment feeling across the world.”

(Editing by Pravin Char)

A school girl arrives with flowers to leave in tribute to Jo Cox, near the scene where she was killed in Birstall near Leeds, June 16, 2016. REUTERS/Phil Noble