The EU needs a Brexit endgame

After 31 months of the United Kingdom and the European Union arguing over Brexit, the truth is that neither side knows what it wants.
This sad reality is most obvious in the case of the UK, whose ruling Conservative Party has consistently been at war with itself over the actual meaning of the June 2016 Brexit referendum.
After a series of strategic mishaps and tactical blunders by Prime Minister Theresa May, the Tory infighting came to a head in mid-January, when Parliament voted down her negotiated exit agreement. It made clear that May lacks support within her own party for a realistic compromise with the EU. At the same time, a majority of MPs and British voters oppose the “no-deal” exit advocated by hardline Tory Euroskeptics.
That scenario would put the UK in breach of legally binding international commitments, jeopardize the 1998 agreement that ended violent sectarian conflict in Northern Ireland, and result in immediate economic costs and job losses.
At a time when US President Donald Trump is hastening the demise of the post-war global order, it is frankly stunning that Brexiteers still believe in the fantasy of a thriving, free-trading Global Britain. And yet here we are.
The EU finds itself in a rather different situation. Since the referendum, the 27 other member states have displayed impeccable unity; their chief Brexit negotiator, Michel Barnier, has made skillful use of his mandate.
The EU has steadfastly rejected Britain’s demand for an unbundling of the single market, as well as any scenario that could result in new customs checks on Irish soil. Throughout the negotiations, the contrast between the UK’s amateurish muddling and the EU’s show of clarity and consistency could not have been sharper.
Still, the EU has demonstrated a remarkable lack of strategic perspective, focusing wholly on rules and processes instead of results. True, its steadfast rejection of à la carte solutions reflects the fear that a favourable deal for the UK will whet the appetites of other Euroskeptic member-state governments. But that does not excuse the failure to develop a strategy for structuring the future UK-EU relationship.
Although Britain is a major European power whose global outlook, financial clout, and security capabilities remain unique, the EU has done very little to engage with British civil society, political constituencies, and businesses, or to foster a productive conversation about the future. This is especially unfortunate at a time when Europe, to which Britain still belongs, is facing proliferating economic and geopolitical threats.
This week, MPs from both the Conservative and Labour Parties attempted to build an alliance and seize control of the Brexit process from May. In the event, their effort failed, and the Prime Minister successfully rallied her camp around an amendment giving her a mandate to go back to the EU and negotiate unspecified “alternative arrangements” for the Irish question.
The EU’s immediate and legitimate reaction was to refuse to re-open negotiations that had been concluded in November. But it should not wash its hands of Brexit. It is not for the EU to choose for the British people, but it cannot escape its responsibility for the choice they are being offered. The EU must now, de facto, decide whether to let the UK choose between the existing agreement and no deal, between no deal and a second referendum, or between no deal and a revised exit agreement. Whatever position it takes, will determine the binary question that the British must ultimately answer.
The EU’s first option is to stick to its guns. Many on the continent think that enough is enough, and that it is time for Britain to decide its fate. But if the EU does assume this uncompromising stance, it will further weaken May, embolden the hardline Brexiteers, limit the space for parliamentary initiatives, and leave no time for a second referendum.
The UK will have to choose between crashing out and accepting the deal it rejected a few weeks ago. This hardball strategy might work, but it would also increase the risk of an acrimonious no-deal Brexit.
The EU’s second option is to remain firm on substance, but to accept an extension of the March 29 deadline if the UK holds another referendum. This would strengthen the position of those in Britain who are calling for a “people’s vote” on the country’s options. “Remain” would gain traction, and a no-deal scenario would become less likely.
The EU’s third option is to express openness to a marginally amended deal. It could either offer a concession that would help May save face on the Irish question, or reach out to the would-be alliance of Labour and Tory MPs who favor a soft Brexit by accepting a short extension of the March deadline in order to hold a substantive discussion on a future partnership agreement. Either option would foreclose a second referendum, and a revised deal would gain the edge over a “hard” Brexit.
For Europeans who were rightly shocked by the demagogy and outright lies of the “Leave” campaign, creating the conditions for another referendum (the second option) is tempting. The problem here is not that Leave could win again, but that it could lose by so narrow a margin as to render the UK incapable of engaging with EU partners in any meaningful way. Such an outcome would only add to the danger of deeper paralysis for Europe, just when it needs to reinvent itself.
Given the obvious economic and political costs of the first option, the third option now seems like the best way forward. The EU should stand firm on principles, but consider either a softening of the negotiated deal or a short deadline extension for talks about the future, if there is a bipartisan appetite for it.
A partnership between Britain and the EU would preserve the close economic, political, and security links that have been built over decades. And the EU would be better able to address the challenges of its own differentiated integration.
Perhaps in a decade or two, the EU and the UK will have undergone comprehensive reforms that put them on a new path toward convergence. Brexit should be managed in a way that makes such a future possible. - Project Syndicate