Jun 11th 2016

History Once as Tragedy, Twice as Farce? American lessons from a British referendum

by David Coates

David Coates holds the Worrell Chair in Anglo-American Studies

 

The United States is not alone in being in campaign mode. The United Kingdom is as well. Not for the British a general election in November, as here. Rather, a June 23rd referendum on whether to remain, or whether to leave, the European Union – the 28 member economic-political union headquartered in Brussels. But though the dates are different, and the specific issues in play are not the same, there are some disturbing parallels between what is now underway in the British Isles and what will likely be underway here after the party conventions in July. And because those parallels exist – and because both electoral clashes are currently too close to call – Americans would do well to both understand and to watch as the UK votes.

I

There is nothing particularly new about Euro-skepticism in the UK. What is new is its location. A generation ago, it was rank and file Labour Party voters who opposed membership of what was then the Common Market, understanding it to be a capitalist club of which they wanted no part. Now the opposition is largely anchored outside Labour – in the UK’s Tea Party equivalent (UKIP, the United Kingdom Independence Party) and in the ruling Conservative Party: both of which see the European Union as too powerful, too bureaucratized and too welfare-minded. Conservative Euro-skepticism forced the current Prime Minister, David Cameron, to renegotiate the UK’s terms of membership (he did that in February, winning very few concessions and failing to impress those watching the negotiations from the UK[1]) and now to hold a referendum on those new terms, with two-thirds of the MPs in Cameron’s own party leaning towards the “Leave” side.[2]

The EU referendum is being held on “Brexit – Britain’s possible exit from the European Union – not because the bulk of the UK population is keen to be asked. They are not. Referendums rarely work well, or indeed are rarely thought to be necessary, in parliamentary democracies. No, this referendum is being held primarily because of deep divisions inside the UK Conservative Party – because of what the British refer to as a “blue-on-blue” clash (blue, of course, being the color of the Right in the UK, not of the left) – divisions that parallel those inside the GOP between the Trump and the anti-Trump factions.

The Republicans can’t get their act together, and we get Trump. The Conservatives are equally immobilized, and the British get a referendum. And like us, many of those voting on June 23rd remain deeply unimpressed both with the arguments on offer and with the quality of the candidates offering them.

II

The “Leave” argument has many Trump-like parallels. The “Leave” campaigners’ big immediate issue is immigration: they claim that EU rules allow in too many displaced foreigners, whose presence in the UK takes jobs away from certain native-born workers, and helps lower the wages of the rest. This anti-immigration sentiment is then packaged into a general assertion of the need to reassert UK independence: reassert it by breaking decisively from a European Union whose regulations ‘trump’ national law, and reassert it by striking out alone again as an independent global player.[3] Those who would have the UK leave the EU insist that by doing so, the UK Treasury will save large sums of money now flowing to Brussels – the “leave” campaign bus is currently crisscrossing the UK with a We send the EU £350 million a week. Let’s fund our NHS instead” slogan painted on its side money that could finance much-needed healthcare and education expansion. The “Leave” campaign also insists that, once out of the EU, new trading relationships can and will be established easily and rapidly with the rest of Europe,[4] in that way repositioning the UK – like Norway and Switzerland now – as a prosperous off-shore economy able to trade effectively with growing markets beyond Europe (in places like China, South Asia and the United States).[5]

The “Remain in the EU” argument is less immediately appealing, but by any sane standards is far more potent. [6] It is that leaving the EU will cut the UK off from vital export markets in Europe, undermine the role of the City of London as Europe’s financial center, weaken the exchange rate of sterling,[7] and lock the UK onto a lower economic growth trajectory: one characterized by lower living standards, higher interest rates and greater unemployment. The claims about immigration made by the “Leave” campaign, and the linked arguments about excessive flows of tax-payer money to Brussels, are both dismissed as factually inaccurate. (More than half the monies flowing to Brussels immediately return to the UK in the form of EU grants.[8] Cutting immigration will lower economic growth;[9] and the notion that 88 million Turks will flow into the UK just as soon as Turkey is admitted into the EU is countered by the observation that Turkey will not join any time soon, and that when/if it does most Turks will choose to stay home!)

The “Leave” arguments about enhanced independence are countered by claims about the UK’s greater international leverage as a major player within Europe rather than as a depleted global power outside it.[10] This depletion will be particularly severe, so the counter-argument runs,  if, as is likely, a vote to leave the EU will trigger a second referendum on Scottish independence (English voters being far more Euro-skeptic than their Scottish equivalents) leading to the disintegration of the United Kingdom into a set of smaller and less potent states. Nor do “Remain” advocates buy the “Leave” argument that renegotiating trade deals with an EU deserted by the UK will be easy: on the contrary, they suspect that those trade negotiations will be long and arduous. Barack Obama said as much, with reference to any future US-UK trade negotiations, when in London last month.

Both sides recognize that the uncertainties surrounding the vote are currently weakening sterling and delaying business investment. The “Leave” campaign treats those as temporary. The “Remain” campaign treats them as harbingers of greater weaknesses to come. The question before the UK electorate on June 23rd is which of these ultimately untestable scenarios will turn out to have been the right one.

III

Two contrasting features of the referendum conversation currently underway in the UK deserve particular attention here in the United States. One is the likely pattern of voting in the UK in June. The other is the imperviousness of much of that voting to the weight of expert opinion now being deployed to shape it.

To take the “weight of expert opinion” point first, it is this. UK voters now have at their disposal an overwhelming number of official, independent and external evaluations of the likely economic impact of a vote to withdraw from the European Union. There are a string of reports from the UK Treasury (two major ones),[11] Cabinet Office,[12] and the Bank of England.[13] There are parallel reports from the Organization for Economic Co-operation and Development[14] and the International Monetary Fund.[15] There are reports from well-regarded independent think-tanks such as the National Institute for Economic and Social Research,[16] the Institute for Fiscal Studies[17] and the Centre for Economic Performance:[18] as well as from leading business confederations,[19] trade unionists,[20] church leaders[21] and major economists.[22] The arguments and findings from each of them are remarkably similar. Leaving the EU will hurt the UK economy, and hurt it badly: lowering the growth rate of UK GDP by anywhere between 1.5 percent (NIESR) and 6.0/6.2 percent (UK Treasury); costing jobs (maybe as many as 1 million, according to the Confederation of British Industry); adding to borrowing costs, not least for housing (again, the UK Treasury); and eroding general living standards (by anything between £850 per household/year to £4,000, depending on which report is followed).

There are even reports available to UK voters pointing out that it is the poorest regions in the UK economy that are most dependent on unfettered EU trade,[23] and that the main costs of any withdrawal from the EU will fall on the very demographics most likely to vote for that withdrawal.[24] Indeed, “of the eight evaluations recently surveyed by the Institute for Fiscal Studies, a respected independent research institution, only one claims that leaving the EU would lead to significant economic gains; and that study – produced, unsurprisingly, by Economists for Brexit – has been sharply criticized by the rest of the economics profession for lacking an appropriate analytical basis.”[25]

Yet this imbalance between near expert-unanimity on the one hand, and an evenly divided electorate on the other, simply brings us to the other key comparative point here: the indifference of many “Leave” voters to the data and evidence available to help shape their choice. Very many “Leave” supporters just don’t believe the experts, and think instead that government experts have abused their position, giving partial accounts of costs and benefits, and overplaying the dangers of a British withdrawal from the EU. Michael Gove, Boris Johnson’s great ally in the leadership of the “Leave” campaign, spoke for them all when he told Sky News that “people in this country have had enough of experts.”[26] Instead of allowing such “expert” opinion to carry the day, the “Leave” campaign is sustained by a popular press – the famous UK tabloid press –that is currently beating the nationalist drum for all it is worth, emphasizing the negative consequences of immigration flows, and treating this vote as an opportunity to break once-and-for-all with a London-based consensus that is so unpopular in many English regions.

And that latter ploy is definitely working: because it is not just the United States that has an anti-Washington dimension to its conservative politics. The United Kingdom has its anti-Capital City thing too. The North-South divide that sets southern US conservatism against northern liberalism, and the US division between the center of the country and the coasts, have their UK equivalents in an antipathy to London’s prosperity and politics in many northern, western and even southern-eastern parts of an island where economic prosperity is not uniformly shared.[27]

IV

Instead of calm examination of probable outcomes from major decisions, the EU referendum campaign in the UK has been characterized by an increasing tendency for sharp character-critiques of the major players involved, and by a degree of Trump-like demagoguery by leading “Leave” campaigners. (Boris Johnson, as the leading light in the “Leave” campaign, recently likened the European Union to Hitler’s vision for Europe, and earlier dismissed President Obama’s careful intervention as a product of his Kenyan – and so anti-British – background![28]) So blatantly demagogic and ill-informed has the “Leave” campaign lately become, indeed, that even the famously even-tempered former Conservative Prime Minister, John Major, broke his silence at the weekend, denouncing the assertions of leading “Leave” politicians as ”fundamentally dishonest, squalid, a deceit and frankly fatuous.”[29]

There is no doubt that such ugly demagoguery taps into an underlying anger in parts of the UK electorate that parallels the anger in equivalent parts of the US one. The main social groups supporting the “Leave” campaign in the UK are less-college educated, older, whiter and more male than the UK electorate as a whole – paralleling exactly the groups most likely in the US to have supported Tea Party candidates in the immediate past and Donald Trump today. Across Europe as a whole, right-wing authoritarian populism is on the march everywhere – a populism of a kind that, in the interwar years, carried a Hitler and a Mussolini to power. The stakes are not that high this time round – or at least let us hope not – but what is at stake in the June referendum is definitely the UK’s place in that march. Will right-wing populism be halted at the last minute, as it recently was in the election for the Austrian presidency; or will the UK vote be the harbinger of a dramatic shift towards authoritarianism and nativism elsewhere in Europe (in France and even Germany), and even perhaps in the United States by year’s end?

Let us hope not. But note this. There is a remarkable pattern in recent key political moments between the UK and the US. It is a pattern whose substance just differs, depending on whether it is a pattern of the center-left or of the center-right. On the center-left, America seems to move first, and the UK follows. On the center-right, it is entirely other. On the center-left, FDR’s New Deal preceded the Attlee Government’s creation of the modern welfare state by a decade; Bill Clinton’s ‘third way’ accommodation to neoliberalism preceded Tony Blair’s by half a decade; and currently Bernie Sanders is setting a progressive pace that Jeremy Corbyn’s Labour Party has yet to match. On the center-right, by contrast, Margaret Thatcher’s election preceded that of Ronald Reagan by a year and a half; and the kind of austerity politics that the Republicans would love to orchestrate out of Washington from next January have been up and running in the UK for six years now. My own private and rather superstitious fear is that a Boris Johnson-led victory in the referendum on June 23rd will be a telling omen for a Donald Trump victory in November.

A vote for Boris Johnson’s “Leave” campaign, and a vote for Donald Trump as US President, both represent what Sebastian Mallaby quite properly labelled last month “Hail Mary” politics:[30]. But taking what the UK’s leading financial journalist Martin Wolf earlier called “a leap into the abyss”[31] is the most irresponsible form of voting possible, and needs to be resisted wherever and whenever it occurs. For complex problems do not have simple solutions. If they did, those would already have been deployed. Donald Trump is no more the answer to America’s problems than leaving the EU is to those in the United Kingdom. Let us hope, therefore, that saner voices eventually prevail in each.

 

First published, with full academic citations, at www.davidcoates.net

 

 



[1] Andrew Duff, Britain’s special status in Europe: a comprehensive account of the UK-EU deal and its consequences. London: Policy Network Paper, March 2016: available at http://www.policy-network.net/publications/5067/Britains-special-status-in-Europe

 

[2] Toby Helm and Henry McDonald, “Two-thirds of Tory MPs want Britain to quit European Union,” The Guardian, January 6, 2016: available at http://www.theguardian.com/politics/2016/jan/09/tory-mps-britain-european-union-eu-brexit

 

[3] Anand Menon, “Britain’s military standing would not suffer after Brexit,” The Financial Times, April 24, 2016: available at https://next.ft.com/content/a6f95c18-087d-11e6-a623-b84d06a39ec2

 

[4] Ferdinand Mount, “Nigels against the World,” The London Review of Books, May 19, 2016, pp. 21-23: available at http://www.lrb.co.uk/v38/n10/ferdinand-mount/nigels-against-the-world

 

[5] George Parker, “UK trade will flourish outside EU, says Gove,” The Financial Times, April 19, 2016: available at https://next.ft.com/content/d0e88d1a-0624-11e6-9b51-0fb5e65703ce

 See also Chris Giles, “Reality check: the FT dissects pro and anti-Brexit claims,” The Financial Times, April 11, 2016: available at https://next.ft.com/content/133da9c0-f7f7-11e5-803c-d27c7117d132

 

[6] Martin Wolf, “Arguments for Brexit do not add up,” The Financial Times, April 26, 2016: available at https://next.ft.com/content/c72960f0-088c-11e6-a623-b84d06a39ec2

 

[7] Mehreen Khan, “Sterling could fall 20% after EU note – NIESR,” The Financial Times, May 10, 2016: available at http://www.ft.com/fastft/2016/05/10/sterling-could-fall-20-after-eu-vote-niesr/?ft_site=falcon&desktop=true

 

[8] Jon Henley, “Does the EU cost the UK £350m a week?” The Guardian, May 23, 2016: available at http://www.theguardian.com/politics/reality-check/2016/may/23/does-the-eu-really-cost-the-uk-350m-a-week

 

[9] Gonzalo Vina and Gemma Tetlow, “Immigration cut will make UK poorer, says Brexit study,” The Financial Times, May 24 2016: available at https://next.ft.com/content/479abd42-21bf-11e6-aa98-db1e01fabc0c

 

[10] FT View, “What Brexit means for defence and diplomacy,” The Financial Times, May 15, 2016: available at https://next.ft.com/content/9b057474-18fd-11e6-bb7d-ee563a5a1cc1

 

[12] Anushka Asthana, Heather Stewart and Nicholas Watts, “Brexit would negatively affect lives of millions, official UK report says,” The Guardian, February 29, 2016: available at http://www.theguardian.com/politics/2016/feb/28/brexit-would-affect-lives-of-millions-official-uk-report-says

 

[13] Chris Batson, “Brexit carries risk of recession, Bank of England warns,” The Financial Times, May 12 2016: available at https://next.ft.com/content/54c975cc-1831-11e6-b197-a4af20d5575e

 

[14] Ylan Q. Mui, “Leaving the European Union could cost every British family a month’s pay, new report finds,” The Washington Post, April 27, 2016: available at https://www.washingtonpost.com/news/wonk/wp/2016/04/27/leaving-the-european-union-could-cost-every-british-family-a-months-pay-new-report-says

The report, The Economic Consequences of Brexit: A Taxing Decision is at http://www.oecd.org/economy/the-economic-consequences-of-brexit-a-taxing-decision.htm

 

[15] Katie Allen and Anushka Asthana, “IMF says Britain leaving the EU is a significant risk,” The Guardian, April 12, 2016: available at https://www.theguardian.com/business/2016/apr/12/imf-says-britain-leaving-the-eu-is-a-significant-risk

 

[16] Martin Sandbu, “The Brexit scales keep tipping,” The Financial Times, May 11, 2016: available at https://next.ft.com/content/1b8f52ba-16bd-11e6-9d98-00386a18e39d

 

[17] Phillip Inman, “IFS warns Brexit would extend austerity for two more years,” The Guardian, May 24, 2016: available at https://www.theguardian.com/business/2016/may/25/ifs-brexit-extend-austerity-budget-deficit-eu-referendum

 

[18] Thomas Sampson et al, Economists for Brexit: A Critique. LSE: Centre for Economic Performance, Analysis No. 6, 2016: available at https://issuu.com/efbkl/docs/economists_for_brexit_-_the_treasur

 

[19] Julia Kollewe, “Brexit could cost £100bn and nearly 1m jobs, CBI warns,” The Guardian, March 21, 2016: available at http://www.theguardian.com/politics/2016/mar/21/brexit-could-cost-100bn-and-nearly-1m-jobs-cbi-warns

 

[20] Rowena Mason, “UK trade union leaders call on 6 million members to vote remain,” The Guardian, June 5, 2016: available at http://www.theguardian.com/politics/2016/jun/05/uk-trade-union-leaders-call-on-6m-members-to-vote-against-brexit

 

[21] Faith leaders’ letter: “Think of the wider world and vote to stay in Europe,” The Guardian, May 29, 2016: available at http://www.theguardian.com/politics/2016/may/28/peace-europe-different-faiths-must-unite

 

 

[22] Sonia Sodha, Toby Helm and Phillip Inman, “Economists overwhelmingly reject Brexit in boost for Cameron,” The Guardian, May 28, 2016: available at http://www.theguardian.com/politics/2016/may/28/economists-reject-brexit-boost-cameron

 

[23] Craig Berry, UK regions, the European Union and manufacturing exports, speri’comment, May 26, 2016: available at http://speri.dept.shef.ac.uk/2016/05/26/uk-regions-the-european-union-and-manufacturing-exports/

 

[24] Tony Yates, “The worst thing for Iain Duncan Smith’s ‘have-nots’ would be Brexit,” Prospect, May 12, 2016: available at http://www.prospectmagazine.co.uk/politics/iain-duncan-smith-brexit-have-nots-european-union

 

[25] Jean Pisani-Ferry, A British Test of Reason, posted on Social Europe, June 6, 2016: available at https://www.project-syndicate.org/commentary/popular-support-for-brexit-by-jean-pisani-ferry-2016-05

 

[26] Henry Mance, “Britain has had enough of experts, says Gove,” The Financial Times, June 3, 2016: available at https://next.ft.com/content/3be49734-29cb-11e6-83e4-abc22d5d108c

 

[27] Peter Kellner, The Brexit Referendum: Provincial England Versus London and the Celts, posted on Social Europe, March 29, 2016: available at https://www.socialeurope.eu/2016/03/eu-referendum-provincial-england-versus-london-celts/

 

[28] Brendan Simms, “The Great Huckster: Boris Johnson’s reckless distortions of history,” The New Statesman, May 24, 2016: available at http://www.newstatesman.com/politics/uk/2016/05/great-huckster-boris-johnson-s-reckless-distortions-history

 

[29] BBC, Major attacks Vote Leave ‘deceit’ as Johnson defends campaign. June 5, 2016: available at http://www.bbc.com/news/uk-politics-eu-referendum-36454732

 

[30] Sebastian Mallaby, “The Hail Mary gamble of voting for Trump,” The Washington Post, May 27, 2016: available at https://www.washingtonpost.com/opinions/the-hail-mary-gamble-of-voting-for-trump/2016/05/27/8b44c6d0-2374-11e6-aa84-42391ba52c91_story.html

 

[31] Martin Wolf, “A vote for Brexit is a leap into the abyss,” The Financial Times, January 7, 2016: available at https://next.ft.com/content/1f770eb8-b529-11e5-8358-9a82b43f6b2f

 

 

 


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