Brexit Implications

Yesterday British Prime Minister Theresa May signed the official document triggering the European Union’s exit provision, Article 50. With that move Britain has begun its retreat from Europe opening the doors to an uncertain future.

From the British perspective, Brexit is about sovereignty and the ability to more effectively deal with non-British labor, (read to exclude those Britain decides it does not want). The measure passed narrowly but in a Democracy, an inch is as good as a mile.

From the EU perspective, Britain’s departure is unwelcome but not for a want for Briton in particular. The EU worries that Brexit is just the first shoe to drop and more are around the corner. Question, if the EU is so good why would countries want to get out?

In forming the EU, member countries traded some sovereignty for a large common market where trading rules were fixed and not subject to populous tariffs or other whims. Regrettably, the EU also formed a parliament and a wide range of bureaucratic branches fully committed to establishing regulation on all facets of commerce and life in general. Critics see the EU and its Directorates as needless expense supporting a gigantic jobs program.

One of the more troublesome outcomes has been how the EU deals with immigrants. Any immigrant who gains access to a EU member State, for example refugees fleeing war in central Africa, once these immigrants set foot in a member State, they are free to travel to any other State seeking work. And of course, while seeking work, the immigrants are qualified to receive welfare support. IMO, the EU’s inability to deal with this one issue, more than any other, tipped the British vote to leave the EU.

Reports indicate that France may want to follow Briton. France’s reasons center on right wing politics. Life will be better if France calls the shots, the right claims.

The danger embedded in Brexit requires one to check history and see what happened when there was less dependance among European Countries. World War I and II, and all the other wars leading up to world wars should be a sobering reflection. Remember, European Countries have both a long history and a sharp memory.

In addition, these countries are, in comparison to the US, relatively ethnically pure (not much diversity).  Germany tend to be german, France tends to be french, etc. (Ironically, this homogeneity is want makes Italy or Spain or France etc so nice to visit.)

Following World War II the western world was fortunate to have leaders who knew the old world order had to be changed. Within Europe, a series of government agreements, for example the EU (European Government and flag), the Euro (European wide common currency), and NATO (European wide military alliance which include the US). These agreements provided enough grit that the nationalistic urges to settle differences between members would give way to more rational solutions.

The EU common market represent one of the top three markets in the world. Within world currencies, the Euro is often viewed as second only to the US dollar. And visiting Europe with its advanced transportation network (and trouble free border crossing) is a preferred vacation destination. Brexit is a short sighted and most likely unwise move by Britain.

With the rise of China (wealth and military strength), the implosion of the Middle East, the economic stagnation of Japan, and nuclear uncertainty of Pakistan, India, and North Korea, world order is under pressure. Britain by itself provides no reassurance that the British can wield diplomatic or economic strength useful in hammering out a functioning world order better than Britain being an EU member in good standing. The odds are that Briton is on a slide to obscurity (nice place to visit, but….).

Brexit could not have come at a worse time given the naivety of the incoming Trump Administration. Can a “one off deal making” mentality summon up the strategic vision necessary to guide other countries towards a peaceful world order?

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