Choices for Britain and the European Union

StatementBrexitCaptioned
StatementBrexitCaptioned

Earlier this month, Prime Minister David Cameron agreed in Brussels on conditions allowing the United Kingdom to remain in the European Union. Based on this agreement, his government called a national referendum on EU membership for June 23, writes Prince Michael of Liechtenstein.

The Conservative cabinet considered the terms of this compromise deal sufficient to recommend staying in the EU, although its decision was not unanimous. The decision to call a referendum is justified, because UK membership will only be successful if it is supported by a broad majority of the population.

A lot of haggling preceded the agreement. The question is whether it produced a compromise that is beneficial for both sides.

Regardless of its shortcomings, an agreement to keep Britain in benefits all. The hard part is striking a workable balance between EU principles and British pragmatism.

Take social security entitlements for immigrants from other EU member states, which often offer weaker benefits. This is a general European problem. Highly developed welfare states have issues with immigrants. The solution reached – a one-off, seven-year “emergency brake” on some in-work benefits – gives the UK some relief without destroying the principle of freedom of movement within the EU.

Other issues crucial to Mr. Cameron included national sovereignty, especially an opt-out clause from the EU treaty commitment of “ever closer” union and provision for allowing national parliaments to block EU legislation under certain conditions. On the financial side, independence from eurozone regulatory decisions was also crucial.

The stakes raised are important.

For the UK, leaving the EU would mean redefining and renegotiating relations with its most important economic partner from a position of weakness. Brexit could also pose a threat to the country’s territorial integrity by enhancing the case for Scotland’s independence.

The damage inflicted on the EU would be just as severe. The removal of its second-largest economy would lessen the power of the bloc, while the loss of Britain’s global political weight, experience and military reach would strike an even heavier blow to Europe’s already feeble foreign and security policies.

The pragmatic but disciplined British approach to politics also acts as a very important check in EU decision-making processes, curbing excessive centralizing tendencies.

The price of the February 19 deal in Brussels has been to further complicate the already oversized and unwieldy EU framework. It will only encourage other member states to press for more exceptions and special status, making the system even less functional.

For the moment, it is a waste of time to speculate on the likely decision of UK voters. The situation exposes weak points in the great project of European integration. It would be unfair to blame the EU for this, since the decisions were made by the European Council, which is composed of national governments.

Things might not have come to this pass if there had been more respect for the principle of subsidiarity, both on the EU and the national level. This would mean delegating more tasks from Brussels to the national governments, from national governments to regional authorities, and so on down the line until one reaches individual communities, companies and people.

What the EU should be concentrating on is protecting its four freedoms ­– free movement of goods, capital, services and people – and common global interests. At the same time, it should be fostering healthy competition among its member states and regions.

Probably due to its complex framework, the EU’s institutions and member states have a bad record of breaking their own rules. The Maastricht fiscal criteria were never respected. Schengen rules are routinely broken and the European Central Bank’s program to buy sovereign debt violated the EU ban on government bailouts.

We can only hope that exceptions for the UK will drive home a lesson on the need to reform and decentralize. Such reforms appear unlikely today, but hope still exists. British involvement could be helpful on this path. Failure to reform will lead to the EU’s creeping disintegration, as member countries grow more aggressive in seeking special status and turn a blind eye to the rules.

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