Lessons from Brexit

NZCPR | 1 July 2016

“Should the United Kingdom remain a member of the European Union or leave the European Union?”
– Remain: 16,141,241 – 48.1%
– Leave: 17,410,742 – 51.9%

After one of the most divisive campaigns in British history, the UK is now preparing for a future outside of the European Union. After 43 years as part of the alliance, the Brits surprised all predictions with 52 percent voting in favour of leaving.

The debate got dirty. Boris Johnson, the former London mayor, who led the “Leave” campaign, accused the European Union of pursuing similar goals to Hitler in trying to create an all powerful superstate. He charged his former best friend, Prime Minister David Cameron, who led the “Remain” campaign, with scaremongering: “I think all this talk of World War Three and bubonic plague is totally demented.”

The majority of voters ignored the pleas to remain from most British MPs, world leaders including President Obama, almost every trade union, employers’ groups, academics, sports stars and other famous people. The result has been described as the biggest slap in the face ever delivered to the establishment by ordinary people – who demonstrated an astonishing determination and scepticism in face of an unprecedented fear campaign.

The fallout has been widespread. In the wake of the defeat, Prime Minister David Cameron resigned, and a coup is underway to oust the Labour Party leader, who many described as lacklustre during the campaign. Scotland, which voted to remain in the EU, is now threatening to pull out of the UK, and Northern Ireland is considering reunification so it too can stay in the EU. The British pound had its largest fall in many decades, and stock markets around the world remain volatile.

Meanwhile, EU leaders are worried that other member countries may want to follow Britain’s lead – and with good reason.

Geert Wilders, the leader of the Dutch anti-immigrant PVV party, wants to make a Dutch referendum on EU membership a central theme of his campaign to become prime minister next year: “I congratulate the British people for beating the political elite in both London and Brussels and I think we can do the same. We should have a referendum about a ‘Nexit’ as soon as possible.”

Marine Le Pen, France’s far-right National Front leader called the referendum a ‘Victory for freedom’ and said, “We now need to hold the same referendum in France and in other EU countries.”

The leader of the anti-immigration Danish People’s Party Kristian Thulesen Dahl, an ally of Denmark’s right-leaning government, also called for a referendum: “I believe that the Danes should have a referendum on whether we want to follow Britain or keep things the way we have it now”.

In Sweden, Jimme Akesson, the leader of the anti-immigration Sweden Democrats party, which holds the balance of power, is pushing for a for a ‘Swexit’: “We demand that Sweden immediately starts to renegotiate the EU deals we have made and that the Swedish people will be able to speak up about a future EU-membership in a referendum”.

Austria’s far-right Freedom Party called for the heads of the European Commission and European Parliament to resign after the Brexit vote, and said it may also call for a referendum unless the EU is reformed.

In Italy, the second most popular party, the opposition 5-Star Movement described the result as a lesson in democracy and promised to pursue its own proposal for a “consultative” or non-binding referendum on whether the country should remain in the euro zone.

In Hungary, Prime Minister Viktor Orban called for reform of the EU: “Brussels must hear the voice of the people; this is the biggest lesson from this decision”.

In Athens, Nikolaos Michaloliakos, the leader of the right-wing Golden Dawn party, predicted the referendum would empower “nationalist forces” across Europe: “I hope that sometime a referendum can be held in Greece, which has been brought to its knees economically and enslaved, assigning its national sovereignty to the Europe of usurers.”

A number of recent polls have shown that across Europe, anti-EU sentiment is increasing, and the call for EU powers to be returned to national governments is growing stronger.

The EU has only itself to blame.

The concept of European integration emerged after World War Two and led to the formation of the European Economic Community, or Common Market, in 1957. Britain joined in 1973.  The European Union was formally established by the Maastricht Treaty in 1993, and further refined by the Lisbon Treaty in 2009. The Euro, which was introduced in 2002, is the common currency of 19 of the 28 EU member states.

The EU is based on four founding principles – the free movement of people, goods, services and capital. EU founders believed that enabling people to move from countries with no jobs to countries with labour shortages, would not only boost European growth, but would help to prevent war by encouraging people to mix across borders. In that regard, the EU was both an economic free trade project and a social engineering experiment.

But from the beginning, there were concerns that the EU would morph from its primary role of facilitating free trade amongst nations of the European continent as a single market, into a political power base intent on imposing a common government on Europe. What has evolved over four decades has confirmed those fears. The EU is now a bloated bureaucracy employing some 50,000 people, who pass laws that no-one asked for, that no-one wants, and that no democratic government can change.

Ridiculous examples of such law-making were quoted during the campaign including rules that specify bananas must be ‘free from abnormal curvature’, that cucumbers need to be ‘almost perfectly straight’, and that manufacturers of bottled water can’t use labels stating that drinking water reduces dehydration because the European Commission ruled that drinking water ‘does not ease dehydration’!

A plan by the European Commission to ban the manufacture, importation, and sale of vacuum cleaners, hair-dryers and other domestic appliances above a 1,600-watt limit – as part of a drive to reduce domestic electricity use – resulted in such an outcry that it was dropped. This was also the fate of a doomed proposal to ban the use of traditional refillable olive oil bottles on restaurant tables throughout the EU, and replace them with non-refillable bottles with proper labelling and tamper-proof lids.

At its heart, the Brexit vote was all about ordinary people thumbing their noses at arrogant socialist bureaucrats imposing their own naive ideals onto others and taking away the rights of individuals and their countries to make their own decisions. Given the history and character of the British, it was inevitable that at some point people power would say enough was enough.

By rejecting the European project as a failed social experiment, voters in Britain turned their back on the EU. They wanted the UK to again become independent and self-governing, living under its own laws and setting its own destiny.

The major underlying concern of British voters was immigration.

The principle of free movement gives all EU citizens the right to travel, live and work wherever they wish. But Britain, with an average wage many times higher than in Eastern Europe, became a magnet for people from the East. And there was nothing the UK Government could do about it.

In response to growing public concerns about the changing face of their communities, along with the impact of immigration on jobs and local services, Prime Minister David Cameron pledged, in last year’s election, to reduce the number of immigrants coming into Britain. He wanted to negotiate a new deal with the EU ahead of the referendum. But his failure to achieve any meaningful change, simply entrenched the nationalist view at home.

In order to bring net immigration down from around 300,000 a year to below 100,000 – as he pledged at the last election – the Prime Minister has had to crack down on those coming to the UK from outside the EU, including New Zealand.

Essentially that has meant turning away highly skilled non-Europeans in favour of unskilled workers from within the EU.

Growing public concerns over immigration were also compounded by the EU’s failure to effectively address the refugee crisis.

Under the Dublin Convention, the EU protects its external borders by requiring refugees to claim asylum in the first country they enter. But German Chancellor Angela Merkel’s offer to settle any Syrians who made it as far as their border, totally undermined the system. It not only resulted in tens of thousands of desperate people forcing themselves across borders, but it also fuelled people-trafficking on such a massive scale that almost 3,000 people have died in the Mediterranean so far this year alone.

While Britain has been shielded from the worst of the migrant crisis by its geography and its decision to opt out of the Schengen Agreement – which largely abolished border controls between 26 member nations – the relentless nature of this tragic problem and the high human cost, have reinforced in the British public’s mind the EU’s political incompetence.

In his article Trade and Immigration After Brexit, this week’s NZCPR Guest Commentator Professor Richard Epstein of the New York University Law School explains, “The difficulty with the EU is that Great Britain had to take the bitter with the sweet. To gain access to the stagnant EU, it had to accept the power of the EU to block the trade deals that Britain could make with Canada, India, and the United States…”

He suggests that the potential gains for the UK from such deals, would be enormous – a point not lost on New Zealand, which is already eyeing up potential opportunities for a quick trade deal, by offering to send some of our experienced trade negotiators to the UK to help them set up their own infrastructure, instead of relying on EU.

At the present time the European Union is New Zealand’s third largest trading partner, with trade in goods and services valued at over $19 billion in 2015. Our exports were worth $8 billion, in mainly sheep meat, fruit, wine, tourism, transport and education, and our imports, worth $11.6 billion, were largely motor vehicles, aircraft, and medicines.

Exports to the UK were worth around $3 billion and imports around $2 billion. The UK accounts for over $4 billion of Foreign Direct Investment into New Zealand – 4.4 percent of the total. Over 13,000 UK residents migrated permanently to New Zealand last year (11 percent of total migrants), and almost 10,000 Kiwis went to live in the UK.

When it comes to what lessons New Zealand can learn from Brexit, the most important one is for politicians – and that is that in a democracy, people matter.

The problem we face is that when it comes to difficult issues, most politicians stop listening and develop a ‘we know best’ attitude – especially when the concerns are about politically sensitive matters like race. In New Zealand, this not only covers unease about immigration and its effect on our culture, but also alarm over the relentless push by tribal elites for racial privilege.

It is time the Government started listening to the concerns of ordinary citizens and realised that New Zealanders do not want a race -based society. If they continue to ignore these public concerns over race, the Government may well get a rude awakening – perhaps similar to that now being experienced in the UK and the EU.

For what Brexit has shown is that when issues connect with the heartfelt concerns of ordinary people, the results can shatter the establishment. If a political leader is prepared to push for a binding referendum for a colour blind society as an election pledge in 2017, the result for New Zealand could be just as profound as the Brexit vote in Britain.

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