Rethinking Europe

Brexit: Separating the Good From the Bad From the Ugly

It is high time for Europe to engage in nuanced analysis of the Brexit vote. Part of the protest was right on target. The EU should learn from it.

Credit: Octavus Shutterstock.com

Takeaways


  • The British ultimately hate the EU even more than they fear the unknown.
  • Fearful of public backlash, the EU employs a “sleeper pill” strategy to extend its competences.
  • There is a dark side to the UK, commonly referred to as “Little England.”
  • Little England is inhabited by self-righteous people who mistake xenophobia for patriotism.
  • Little Englanders think they still live in the British Empire, but lack its entrepreneurialism.
  • The final takeaway from Brexit? Answer: Disillusionment about both the EU and the UK.

Over the course of the decade I lived in the United Kingdom, in the early 1990s and then again through most of the 2000s, I developed a certain affection for the country and its people.

Naturally, this was a rather one-sided affair, as the English tend to not reciprocate foreigners’ affections. They take it for granted.

Against the background of my decade-long experience in the UK, I was not surprised about Brexit, although I had not expected it. I had thought that the fear of jumping into the unknown – for that is what the consequences of Brexit are — would be greater than the aversion to the European Union.

The fact that a majority of the British electorate voted for Brexit anyway is a clear sign that the British ultimately hate the EU even more than they fear the unknown.

What next?

In order to assess what the right way forward is for the UK (and Europe), it is important to understand the vote more fully. For me, there are three main aspects to the Brexit vote: the good, the bad and the ugly.

#1: The good

Yes, there is a good side to the Brexit vote, even from a continental European perspective. To its credit, more than any other democracy in the world, the UK is a parliamentary democracy.

In the UK, parliament is at the core of political power, not a president (as in the United States and France) or party leaders (as in Germany).

This has a long tradition in England. The Magna Charta of 1215 was a key step towards limiting the King’s power by virtue of rules.

Later, in the era of absolutism of the 17th century, when the French King Louis XIV declared “l’Etat, c’est moi,” the British parliament notably declared it as its main goal to protect the liberty of the people against arbitrary rule by the government.

The liberal philosopher John Locke saw government as bound to act according to agreed and publicly declared laws. That is why laws developed by parliament and the rule by law are the key elements of British parliamentary democracy.

This does not mean that sovereign power cannot be delegated to a supra-national institution, like the EU. But delegation has to be specific and clearly defined in treaties.

It is unacceptable that an institution, which has been given certain sovereign functions, twists the treaties and encroaches on the sovereignty of parliament by stealth.

The EU’s “sleeper pill” strategy

Yet, this is exactly the strategy by the European unionists. Fearful of potential public backlashes, the EU basically employs a “sleeper pill” strategy to extend its competences.

In case you think I am exaggerating, or making this up, when asked about the way in which the European Union is moving toward an “ever closer union,” Jean Claude Juncker, now the EU Commission President, already long before he assumed that post is reported to have said:

We decide on something, leave it lying around, and wait and see what happens. If no one kicks up a fuss, because most people don’t understand what has been decided, we continue step by step until there is no turning back.

The Juncker strategy of constructing an ever closer union by stealth against what are, as is undoubtedly clear by now, the revealed preferences of the European peoples has been most evident in the development of the European Monetary Union.

Having been launched as a pure currency union akin to a super-gold-standard, it has grown to a formidable force undermining national sovereignty.

EMU member countries in financial difficulties have had to accept foreign rule by European institutions, with the International Monetary Fund as their sidekick.

The severe piercing of sovereignty also extends to the financially stronger countries – the ones that are presumed to “dictate” the terms of what goes in the eurozone. There, present and future generations of tax payers have been enlisted to fund enormous transfers to crisis countries.

Who’s standing up for sovereignty?

The German Constitutional Court has made a few feeble attempts to rein in the unilateral takeover of national sovereignty by European institutions, notably its highly skeptical assessment of the ECB’s program dubbed “Outright Monetary Transactions” that paves the way for central bank assistance to countries in financial crises.

But its rulings were countered by the European Court of Justice and it ultimately did not dare to stand up against this European institution.

But, as the late economist Albert O. Hirschman argued, if “voice” is ineffective, the only other option is “exit.”( Albert O. Hirschman: Exit, Voice and Loyalty. Responses to Decline in Firms, Organizations and States. Harvard University Press, Cambridge MA 1970)

Thus, to the extent it was motivated by the stealth takeover of national sovereignty by European institutions, I welcome Brexit as a protest against the undesirable “constructivism” of the European political elites.

#2: The bad

The UK is also the birth place of liberalism – manifesting itself via individual freedom, the rule of law and respect for minorities in society. In the evolution of various forms of social order through trial and error, the liberal order has come out the winner.

The liberal order has evolved bottom-up, through experience, and has been established by social consensus of its members.

No wonder then that it delivered a higher level of material and personal wellbeing for a larger share of members of society than any other approach to organizing human activity.

Is the EU liberal?

Liberalism is endangered by constructive rationalism of the Cartesian type. Constructive rationalists believe in the power of reason to shape the optimal social and economic order. They have little regard for trial-and-error as a means for discovery, as this approach lacks a theoretical underpinning.

These bureaucratic rationalists also find rules a hindrance to progress. Why? Because they see rules as standing in the way of decisions based on rational analysis of all available facts. Constructive rationalists champion the organized society, shaped by rational design.

Appealing as it may sound as a theoretical concept, constructive rationalism does not stand the test of reality. It presumes knowledge of a central planner or decision maker that nobody can have.

Knowledge in society is distributed over many heads and exists in these heads often in a form that cannot be communicated well, but is suitable for action. That is why the “organized” society has turned out an error in the evolution of social orders.

France as a driving force toward EU central planning

Nevertheless, Cartesian constructive rationalism has a strong tradition in France, the birth country of Rene Descartes. Many French intellectuals and policy makers have an inclination to shape the world according to their own preferred design.

In the EU, the French inclination for constructivism has fostered central management of the economy, regulation, bureaucracy, as well as projects detached from the needs of people, such as the euro.
Constructivism is a tempting concept for politicians everywhere.

In their desire to please voters (and get reelected), politicians have an almost irrepressible inclination to promise “the people” the next best grand design. This explains, at least in part, why there has not been more resistance in the EU against constructivist projects.

Having been raised in Germany, a country with only weak liberal inclinations, I have always regarded the UK as a necessary liberal counterweight to the “constructivist” French influence in the EU.

Unfortunately, this constructivism increasingly has all the charms of the production of foie gras, where geese are force-fed in order to achieve the presumed “desired” result – an oversized liver, which has long been declared a major delicacy for which people should strive.

In that context, it is easy to see why it is bad that the UK soon will no longer be there.

#3: The ugly

As I said at the beginning, I have a certain affection for the British. To some extent, this may lead me to take a too rosy view of British society and the motivation for Brexit.

There is also a dark side to the UK, commonly referred to as “Little England.” Little England is inhabited by self-righteous people who mistake xenophobia for patriotism.

They see themselves still living in the British Empire, but lack the entrepreneurial and extensive spirit of those who made it great.

As I argued here in a previous piece, the Little Englanders share many characteristics with the “Identitarians” everywhere who seek in the nation, ethnic background or true faith safety from an increasingly interconnected world.

Like the Identitarians, the Little Englanders are deeply illiberal as they want to shape their surroundings in their image and suppress minorities. They go diametrically against everything that I admire in the British tradition.

Sadly, Brexit allowed these darker forces to come out of their hiding places and lay claim on political power. Ultimately, I do not believe that they will get their way. If they would, it would be ugly for the UK, the EU and the world.

The bottomline

So what is the final takeaway from Brexit? The answer is: disillusionment about both the EU and the UK.
About the EU, because the Brexit vote has exposed it as potentially being on its way to self-destruction.

A great idea as a liberal state order in a formerly war-torn continent to begin with, it has mutated into a constructionist project of the political elites that seems to leave only “exit” to those who disagree with its illiberal character.

That foreshadows the collapse of the entire enterprise. About the UK, because Brexit brought the rise of the Little Englanders who challenge everything I believe Great Britain stood for.

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About Thomas Mayer

Thomas Mayer is Founding Director of the Flossbach von Storch Research Institute in Cologne, Germany, and the former Chief Economist of Deutsche Bank Group.

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