HOW DID WE GET HERE?
The roundtable conversation began with two backgrounder videos on Brexit, the United Kingdom's decision to leave the European Union after more than four decades (for the first twenty as a member of European Community and then in 1993 when the EU was officially formed).
The referendum passed in the summer of 2016, surprising many, including then Prime Minister John Cameron who campaigned against it. To quote from the video embedded below:
Britain is better off inside the EU than out on our own. At the heart of that is the single market: 500 million customers on our doorstep, a source of so many jobs, so much trade and such a wealth of opportunity for our young people.
Yet by calling for the referendum, Cameron literally opened the door for Britain's exit (Brexit). The "Leavers" won handily with a majority of nearly 1.3 million votes, setting in motion events that will directly impact a half billion people in Europe, and indirectly nearly everyone else around the world.
The European Union was born of pragmatism: a strategic move in the wake of World War II calculated to reduce the threat of yet another war. It began with six member countries: Belgium, France, Germany, Italy, Luxembourg and the Netherlands. Today, with Britain, there are 28 countries in EU. While Britain's departure could lead to stronger ties among those remaining, it could just as easily prove to be the EU's undoing, inspring other countries to leave.
Why did this happen?
No one knows the depth of the rift between the United Kingdom and the European Union, making it difficult to predict what leaving will look like even a year later. Matthew Bishop, Senior and Business Editor of the Economist Group, notes that the Labor Party's resurgence in the election recently called by Prime Minister Theresa May indicates the the volatility of British public opinion. Instead of strengthening May's support, the active engagement of younger anti-Brexit voters has weakened it. Without a conservative majority in Parliament, some argue Brexit itself could be in jeopardy.
Euroscepticism—the belief that economic and political integration with the EU weakens sovereignty—has fueled by anger and fear that migrants are increasingly competing with native born Britons for jobs. EU leaders, particularly in Germany, have to decide how to respond to Brexit as it will set the precedent for other countries who may feel emboldened to leave. For example, Euroscepticism is popular in Italy where politicians are deciding which position will win the most votes in an upcoming election. Even in Germany, this is an issue.
At its heart Euroscepticism is a philosophical resistance to taking direction from Berlin or Brussels. It is strongest in countries such as Poland or Hungary where patriotism has been conflated with anti-immigrant rhetoric. Economic issues can become sociopolitical when the blame for local hardships is pinned on "others."
Grzegorz "Greg" Kolodko, who served as Poland’s Deputy Prime Minister and Finance Minister in the 1990s, argues that while the European public favors the benefits of the EU, the media and conservative political leaders have unfairly framed integration as a loss of sovereignty to Germany. This has made room for emotional responses to politically charged issues such as the refugee crisis and immigration and is particularly prevalent in cities with less diversity where xenophobia runs high.
In response to moderator and Chicago Council of Global Affairs Senior Fellow Phil Levy's question about whether other countries are likely to follow Britain's lead out the door, Kolodko notes that at least for some states, that would require a constitutional change — no easy feat.
For supporters of the EU, integration into the Union is vital. If this historical experiment in regionalization succeeds in preventing war and strife—which is largely has—then it provides a model that can be duplicated in other regions experiencing political turbulence.
The UK joined the European Community (pre-cursor to the EU) in the 1970s as an economic Hail Mary, says Bishop, but now feels that the pound is strong enough to survive on its own. Still, the recent election suggests a demographic divide, with younger voters seeing both economic and cultural value in remaining part of the EU.
By contrast, although the French public has been praised for not electing far right candidate Marine Le Pen—by a margin of 65 percent to 35 percent—the more important conclusion may be that she managed to double the proportion of the vote her father, as leader of the same party, managed to get two decades ago. In short, her strength grows, which is not out of line with similar nationalist surges in other European countries. The euro may be stable, but it feels more fragile. The repercussions of these tensions will be felt across borders for decades to come.
The 2020s will be turbulent politically. No matter what the outcomes, the EU has much to deal with in the coming decade, from the fiscal crisis in Greece to the many issues related to climate change.
And what should we do?
There is an urgent need for the media and the intellectual community to push for a more informative public debate, one that engages meaningfully on the long term implications of national referendums and that works to dispel myths around political rhetoric.
Bishop and Kolodko are optimistic about entrepreneurship and business opportunities in Europe. Companies exporting to the continent can easily relocate from London to other thriving, attractive cities in Europe. They point out that the euro is stable and predictable, inflation is under control and regulations are business-friendly.
by Carson Brown, Medill School of Journalism
Senior Editor & Business Editor
The Economist Group
former Deputy Prime Minister
& Finance Minister
Republic of Poland
Senior Fellow, Global Economy
Chicago Council on Global Affairs
Adjunct Professor of Strategy at Northwestern