Brexit: The Opportunity

13/06/2017 12:38

At one point in Homer's epic poem, Odysseus finds himself having to steer his ship past two hazards. On one side is Scylla, a shoal of rocks hidden just below the surface of the water. The other is Charybdis, a huge whirlpool. His job is, of course, to plot and maintain a course between those two destructive options.

The 'European project' that began straight after the Second World War has spent its time in a similar dilemma. Scylla is 'federalism', an overpowerful European superstate, imposing too much on its citizens. Charybdis the whirlpool of old-fashioned xenophobic nationalism that gave rise to the war.

In the 1950s, the project was concerned with escaping the whirlpool. This was the era of the Treaty of Rome, with its commitment to 'ever-closer union'. This tack was reversed by General de Gaulle in 1965, when he walked out of European government because he reckoned it was becoming too powerful. The federalists didn't really recover their momentum till the 1980s - when they did so with great vigour. Popular enthusiasm for 'Europe' and what was then called the EC rose steadily and sharply throughout the decade. Jacques Delors became President of the European Commission in 1985, and drove through a number of new measures, most notably the creation of the Euro. Arguably the high point of the new federalism was the introduction of the single currency in 2002. Doubts then began to creep in, magnified by the Southern European Sovereign Debt Crisis and subsequent centrally-imposed austerity. Maybe the election of Emmanuel Macron will now see another change, and a new enthusiasm for 'Big Europe'.

This tacking back and forth might seem a sign of indecision, but it is much better seen as a creative process, whereby the project tries things, tests them and either accepts or rejects them - the way of evolution. The rocks and the whirlpool won't go away, and somewhere between them is an ideal course that gets maximum value out of European unity without forcing superstatehood on Europe's inhabitants, most of whom, polls continue to reveal, still regard themselves as citizens of their nation first, and of Europe second. But such a course has to be created, not read off a pre-existing map.

So what has this got to do with optimism about Brexit? The answer is that the negotiations, if done well, offer a chance to chart that course better for the future, for Britain and for Europe.

The most important political fact about modern Europe is not the existence of the EU, but the existence of the Eurozone. History shows that common currency areas have one of two fates. Either they coalesce into nations, or they fall apart. Germany provides an example of how such an area worked: during the first half of the nineteenth century, the many small German states gradually moved closer together through a series of agreements on tariff abolition and shared money, weights and measures. In the second half of that century, attempts were made to create common currency areas in 'Latin' Europe (1865) and in Scandinavia (1867). These failed; intriguingly, both lasted about 50 years, though they were effectively killed by the First World War.

The Eurozone is subject to the same logic. Either it will become a nation, like Germany or the USA, or the monetary union will fall apart. Here there is no middle course to be plotted, just two very different end-points. Yes, some countries may drop out, but in the end, Europe will either have no common currency at all, or will be divided into 'Euroland' and The Rest.

So the big issue for planning the future of Europe is 'what will be the relationship between these two blocs?' This is where Brexit becomes important, as it could involve the creation of a model version of such a relationship.

Getting the negotiations right will require creativity, not just pig-headedness. Everyone, it seems, would benefit from the Single Market being as large as possible. Yet can any compromises be done to allow some kind of national immigration control, which seems to be the big red line for the current Conservative negotiators? Some people in the future Euroland will argue no, adding that the UK Conservatives are simply backward-looking reactionaries whose instincts run so counter to those of a more progressive Europe that no compromise is possible. Others may say that some level of border and immigration control could be possible for a 'The Rest' country, and set about debating how it might work in the context of a broad Single Market - the Europe of the future.

The 2017 election offers a ray of hope, that the UK's hard-Brexit-obsessed government will have to back down and take a broader, more tolerant, cross-party approach. Don't hold your breath - but if this happens, Europe has plenty of motivation to meet a more emollient UK negotiating team half way.