Brexit: Symptom, Not Cause, of Turmoil

Commentary No. 428, July 1, 2016

On June 23, the referendum on a British withdrawal from the European Union (EU) won by a clear margin. Politicians and pundits have treated this as an unprecedented and earth-shaking decision. They have been giving various and quite contradictory explanations about the causes of this event and the consequences of this event for Great Britain and the rest of the world.

The first thing to note is that no legal decision to exit the EU has yet been taken. The referendum was, in legal terms, merely advisory. In order to withdraw from the EU, the British government must formally inform the EU that it is invoking Article 50 of the EU’s Lisbon Treaty, which is what provides the right and the mode of withdrawal. No one has ever invoked Article 50, so yes, it would be unprecedented. No one therefore can be sure how it would work in practice. While it seems most unlikely that any British government would ignore the referendum, strangely there has been no major British politician who seemed in a hurry to invoke Article 50, an action that would be irreversible.

Prime Minister David Cameron, who campaigned against Brexit, has said it will not be he who invokes Article 50. Rather, he has announced his resignation as Prime Minister – however not immediately but when the Conservative Party chooses a new leader. Cameron believes this person should be the one who invokes Article 50. This seems on the surface to be sensible. Once Article 50 is invoked, there will be many issues about Great Britain’s future relations with the EU and with other countries that will have to be decided and it might be best that these decisions be made by his successor.

The first question therefore is who will be his successor and when will this person be chosen. There is considerable pressure from other countries in the EU that this succession be done as soon as possible. In response to this pressure, the Conservative Party has set the date as September 2. There were until June 29 two main candidates: Boris Johnson, a leading advocate of Brexit but not yet a member of parliament; and Theresa May, who opposed Brexit but who shares some part of the objectives of the supporters of Brexit. It is stunning to learn that Johnson actually expected to lose the vote and therefore did not prepare a political map for what he should do after the referendum.

It seemed that Johnson wanted to “negotiate” Britain’s withdrawal. Article 50 provides a two-year period for working out post-withdrawal arrangements. This seems to allow for such negotiations. It also says that, if no agreement is reached, the cutting of all ties is automatic. What Johnson apparently wanted was a deal in which Great Britain retained the advantages of a common market but would no longer be bound by the EU’s constraints on immigration and human rights. The other countries in the EU have been showing no sympathy for such an arrangement. As Germany’s quite conservative Finance Minister Wolfgang Schäuble said, they feel that “in is in and out is out.” Since “out” will have immediate negative consequences on the economic situation for most persons in Great Britain, and especially many of the supporters of Brexit, Johnson and others have been dragging their feet about invoking Article 50. This is probably what underlay Michael Gove’s last-minute decision to cease being Johnson’s campaign manager and to announce his own candidacy, backed immediately by most strong Brexit supporters. Gove, it seems, will not hesitate. Johnson has withdrawn his candidacy and is possibly quite relieved not to be the one who gets the blame for invoking Article 50.

What are the matters underlying this debate? There are essentially four: popular anger at the so-called Establishment and its parties; the geopolitical decline of the United States; the politics of austerity; and identity politics. All of them have contributed to the turmoil. But all of them have a long history that predates by far the Brexit referendum. The priorities among these four are different for the multiple actors, including the British who voted to leave Europe.

There is little doubt that popular anti-Establishment anger is a strong force. It has often erupted when economic conditions are uncertain, as they surely are today. If this seems a stronger motivation now than previously, it is probably because economic uncertainty is far greater than in the past.

Still it should be noted that anti-Establishment movements have not won out everywhere or consistently. The movements sometimes win out, and just as often do not. For successes, one can point to Brexit, Trump’s rise to being the de facto Republican presidential candidate in the United States, Syriza‘s becoming the governing party in Greece, and Rodrigo Duterte’s election as President of the Philippines. On the other hand, see the recent electoral defeat of Podemos in Spain or the signs of some voter remorse already in Great Britain. The life span of such movements seems to be relatively short. So, even if stronger today than in the past, it is not at all sure that such movements are the wave of the future.

The geopolitical consequences of Brexit are probably more important. Great Britain’s withdrawal from Europe deals a further blow to the ability of the United States to maintain its dominance in the world-system. Great Britain has been in many ways the indispensable geopolitical ally (or is it agent?) of the United States in Europe, in NATO, in the Middle East, and vis-à-vis Russia. There is no substitute. That is why President Obama strongly and publicly supported the Remain vote in Great Britain and, after the referendum, has sought to persuade Great Britain to remain a close ally. That is why Henry Kissinger, in an op-ed in The Wall Street Journalof June 28, called for the United States to seek “to transform setback (the Brexit turmoil) into opportunity.” How? By reinforcing the “special relationship” with Great Britain and for the United States to redefine its role in “a new kind of leadership, moving from dominance to persuasion.” Kissinger is clearly worried. It sounds like whistling in the dark to me.

Austerity is obviously nobody’s desired policy, except for the ultra-rich who alone profit from it. The fear of increased austerity, as promised by the British government, surely contributed significantly to the move for Brexit, which was promoted as a way to reduce austerity and secure a better future for the vast majority of the population. Austerity is another theme that today is worldwide – both as practice and as cause for fear and anger. There is nothing special about the British situation in this regard. Modal income has been going down there for a quarter-century at least, as it has been everywhere.

The economic turmoil and the fears it provokes have resulted in the prominence of identity politics – Britain for the British (actually for the English), Russia for the Russians, South Africa for the South Africans, and of course Donald Trump’s America for the Americans. This underlies the call for controlling, even eliminating, immigration. As a bugaboo, there is nothing easier to use than immigration. But identity politics is a loose cannon. It doesn’t have to center on immigration. It can concentrate on secession – in Scotland, in Catalonia, in Chiapas. The list is long.

What shall we conclude from all these currents and countercurrents? Brexit is important as a symptom but not as a cause of turmoil. Since the turmoil is part of a chaotic structural crisis in the modern world-system, it is impossible to anticipate the many ways in which this scenario may play out in the next few years. The short run is too volatile. We are not paying enough attention to the middle run, where the long-run successor world-system (or systems) will be decided, and where the decision remains dependent on what we do in the middle-run struggle.