Is Brexit a true democratic decision?

Definitely, will the whole UK leave the EU?

Brexit has won by 51,9% against 48,1%. The referendum turnout was 71.8%, and 28.2% didn’t vote, and we do not know their opinion. In fact Brexit is backed by only 37,3% of the whole population with the right to vote.

The poll divided the UK. Is the purpose of a democracy to divide the people, to divide a country?

From one side, England voted for Brexit by 53.4%, and 46.6%, so did Wales, with Brexit obtaining 52.5% against 47.5% Remain.

But on the other side, Scotland, Northern Ireland and London both voted Remain. Scotland by 62% against 38%, Northern Ireland  55.8% against 44.2%, and London, the capital of the UK, 59.9% against 40.1%. Gibraltar voted even more than 90% Remain.

England and Wales decided for the rest of the UK and against the will of the other regions of the UK. What kind of democracy is this? Can we call this “democratic quality”?

Scotland, Northern Ireland and Londen (and Gibraltar) are all unhappy, even angry. Scotland could ask for a new referendum to leave the UK and join the EU, and Northern Ireland is dreaming of uniting with Ireland, and in such a way remain in the EU.

Scotland’s First Minister Nicola Sturgeon said that it is “democratically unacceptable” that Scotland faces being taken out of the EU when it voted to Remain. Deputy First Minister Martin McGuinness said that the whole island of Ireland should now be able to vote on reunification.

In their book “Introducing Democracy“, David Beetham and Kevin Boyle pose the question: “Is the majority rule always democratic?” And they speak of the “subordination of minorities” and “the right to veto legislation which threatens their vital interests”, such as “their autonomy in running their own affairs“. They conclude that “A wise majority will go someway towards meeting the minority, if at all possible, rather than using its majority position simply to overrule them. Democracy is only sustainable if people can agree to continue living together. and that requires that majorities, and the governments representing them, be prepared to exercise a measure of self-restraint, and do not always use the majority procedure to capture everything for themselves and their own point of view.”

Other democracies as for instance the Belgian Federal State require for transcendent matters that at least two thirds of the votes are required to be valid, as well in the country as a whole as in each region.

Quality of democracy is important. What happened with the Brexit poll is not high quality democracy.

 

To Brexit or not to Brexit: A Taxing Decision

Remarks by Angel Gurría, OECD Secretary-General at the London School of Economics on 27 April 2016:

Ladies and Gentlemen,

It is a great pleasure to be at the LSE to share the perspective of the OECD on the possible economic repercussions of Brexit. The decision on Brexit is one which will impact on generations to come, so it is fitting that we are in a place devoted to forming future British, European and global leaders. The stakes are high, and understandably, people are in search of objective and dispassionate information and analysis on which to base their decision. That’s where the OECD comes in.

At the OECD, we advocate making policy decisions using evidence-based analysis. We advocate policies that improve the well-being of people. We advocate national policies that take due account of spillovers on the rest of the world. The UK is one of our founding members and one of our most active members. If it’s important for the UK, it’s important for the OECD. Besides, an event of the scale of Brexit has implications not only for the wellbeing of every British citizen, but for the people across the EU, the OECD and beyond. Thus, at the OECD we are duty-bound to assess the possible consequences and flag the risks associated with this decision. I would also say, setting aside my OECD hat for a moment, that I have personal reasons for joining this debate. I came to Britain for the first time in the early 70s, as a student at Leeds University. It was a challenging time of miners’ strikes, 3-day working weeks, energy crises and electricity blackouts. I then came back, this time to London from 1976 to 1978, as Mexico’s Permanent Delegate to the International Coffee Organisation. Since then, over more than 40 years, I have witnessed first-hand the dramatic transformation of this country. The cosmopolitan Britain that I see today, where my son and his wife live, work, pay taxes and raise and enjoy their own children, bears little resemblance to the more inward-looking society I first encountered before the United Kingdom joined the European Union. I will focus today on the economic aspects of Britain’s membership of the European Union. No time to dwell on the EU’s role in preserving peace in Europe and spreading it around the world, as was recognised when the European Union was awarded the Nobel Peace Prize in 2012. It is not the occasion either to elaborate on the EU’s leadership role in environmental issues and their crucial contribution to the success of COP21. Nick Stern, who kindly invited me here today, is the very embodiment of the influence the UK had in that success. Nor do I need to belabour the EU’s virtue as perhaps the greatest exponent of soft power in the world. Neighbouring countries queue up to join the European Union, drawn by the example of its stable, peaceful, prosperous and democratic societies. Certainly no one would claim that the EU is a finished product. The scaffolding is not easy on the eye but the structures being built behind it eventually become a source of admiration and collective strength, once the scaffolding is removed. Being part of this constant work in progress, of this worthy and visionary project, with its vocation for permanent change, reinvention and institutional innovation, makes the UK stronger. Why would anyone want to give up this truly win-win proposition? Brexit, on the contrary, could threaten both the unity of the UK, because of Scotland’s expressed desire to remain part of the EU, as well as the unity of the EU itself, because of the likelihood of other countries believing that there is merit in following the UK’s example. Being a member of the European Union has been good for the UK. Since the United Kingdom joined the European Union in 1973, its GDP per capita has doubled. This is not only more than in the other major EU member states, but also more than in English-speaking countries that are not EU members. More than the United States, Canada, Australia and New Zealand. Look at another English-speaking country, Ireland, which joined the EU at the same time. Its GDP per capita has quadrupled since 1973! The evidence over the past four decades suggests that, far from holding back growth, harnessing the potential of the European single market enhances living standards. Let’s now turn to the future and to the question the British people will have to answer in two months’ time.

The Brexit Referendum: A Taxing Question

The question posed in the referendum, “Should the United Kingdom remain a member of the European Union or leave the European Union?” is a taxing one. Taxing in the sense that its consequences are complex and permanent, not only for the UK but also for the rest of the EU and even beyond. So the responsibility borne by British voters on June 23rd is very serious indeed. It will be an act of intergenerational responsibility. But also taxing because Brexit would, rather like a tax, hit the wellbeing and the pockets of UK citizens. Unlike most taxes, however, this one will not finance the provision of public services or close the fiscal gap. The “Brexit tax” would be a pure deadweight loss, a cost incurred with no economic benefit. And this tax would not be a one-off levy. Britons would be paying it for many years. The OECD has estimated the scale of this Brexit tax for UK households. The details of the relevant criteria and calculations are included in the report that we have distributed to you this morning (Download the report). We are aware of the analysis the UK Treasury produced last week with the same purpose. The LSE’s Centre for Economic Performance has also produced excellent research on the matter. And there is also the report commissioned by the Confederation of British Industries. At the end of our report there is a comparison of the four calculations. There are, of course, some differences in the numbers coming out of these different efforts. Sometimes it is a matter of different time horizons, or variations in assumptions about post-Brexit trading arrangements. Different models can be employed, and research findings drawn from different sources will lead to different estimated costs. But the results are quantitatively similar and qualitatively the same: the UK would be worse off under Brexit. And our estimates are too cautious. For one thing, they focus entirely on future effects, whereas in fact the first payments of the “Brexit tax” are already being made. Just this morning, the Office for National Statistics announced the lowest quarterly GDP growth figures since 2012. And already in the previous quarter, business investment was weak as the Brexit issue gained prominence. Brexit costs can also be seen in financial markets. Since the autumn, the pound has weakened against the euro and the dollar, and the cost of insuring against exchange rate volatility has risen significantly. The costs are piling up, and we are still two months away from the referendum!

The economic effects of Brexit: the OECD’s estimate Near-term effects

Our analysis looks at the effects of a decision to leave the EU over two horizons. From the moment of a Brexit vote until the arrangements for “divorce” are definitively settled — years later — there would be heightened economic uncertainty, with damaging consequences. Brexit would lead to a sell-off of assets and a sharp rise in risk premia. Consumer confidence would fall, as would business confidence and investment, thus holding back growth. Were the United Kingdom to leave the EU, it would have to negotiate new trading relationships. Brexit would mean that the UK would not only give up full and automatic access to the Single Market, but would also lose the benefit of trade agreements covering 53 markets that it currently enjoys and which it helped shape. Supporters of Brexit argue that the UK would actually achieve a more liberal trade regime outside the EU than it enjoys now. But this is a delusion. Bilateral and regional trade agreements take years to negotiate and absorb substantial energy and resources. The United Kingdom would be starting from scratch. The first priority would be to negotiate with the rest of the European Union, which accounts for nearly half of UK exports. Facing an embittered, freshly-rejected and much larger partner with an incentive to make exit costly, is not a good basis for a favourable outcome. Regarding non-EU trading partners, as President Obama reminded us last week, the UK on its own would not be exactly their top priority for negotiating trade deals or granting generous trade concessions. The rewards for potential partners would have considerably shrunk. Taking into account the effects of heightened uncertainty and the less favourable trading environment while new arrangements are negotiated, we put the “Brexit tax” at some 2200 pounds per household by 2020.

Longer-term effects

Over the longer term, the supply side of the British economy would also be negatively affected by Brexit. Without full access to the Single Market, the lure of the UK, which currently receives the largest inflows of foreign direct investment in Europe, would wane. Some foreign businesses that set up here to access the European market could even decide to relocate. The same would apply to many British multinationals. The negative impact on net FDI would hit total investment, innovation and productivity and would also aggravate the adverse trade effects.  Bear in mind also that well over two million UK citizens benefit greatly from the freedom to live, work and study anywhere in the EU. These are some of the freedoms that we should not take for granted. This is a particularly relevant issue for those of who already see yourselves as British, Europeans and citizens of the world. That would be put in jeopardy by Brexit. Less investment, reduced flows of goods and people, costlier credit and lower exposure to ideas and skills across borders would ultimately undermine productivity and the long-run economic capacity of the UK economy. We estimate that in a Brexit scenario, GDP per household in 2030 would be lower than the baseline by at least 3200 pounds and up to 5000 pounds in the most pessimistic case. While no one knows precisely what the costs would be, what is striking about our estimates and those produced by most others is that all the numbers under a Brexit case are negative. The best outcome under Brexit is still worse than remaining an EU member, while the worst outcomes are very bad indeed. The Brexit tax just gets bigger. We see no economic upside for the UK whatsoever. The only question is where, on the spectrum of possible losses, the outcome winds up. The bigger question is why spend so much wealth, well-being, time, energy and talent in order to compensate the damage of a bad decision when you can simply avoid taking such decisions. Why spend so much effort trying to recover the benefits of membership in a club you don’t have to leave? Some are invoking the question of the UK’s sovereignty. But they are invoking a false dichotomy. It is not about the UK being sovereign or not. All countries take decisions on whether to pool their sovereignty depending on the issues involved. The UK does this as a member of NATO, the OECD, the IMF, the World Bank, the ILO and ultimately the United Nations. Taken to the extreme, it would have to leave all these institutions in the quest for “sovereignty”. In reality, the UK, like other countries, weighs the costs of membership against the benefits. Sovereignty is not lost. It is simply used wisely. As a part of the EU, the UK always retains the right to withdraw from the EU, but it leverages its sovereignty to shape a Europe more aligned with the interests of the United Kingdom itself. Such was the case of the deal struck by Prime Minister Cameron last February. If the UK chooses to give up the opportunity to help steer Europe in the right direction, it would be doing so at its own peril. Ladies and gentlemen, We recognise that economic considerations are not the only rationale for voting to remain or exit, and it is for the British people to weigh the different pros and cons. The late Lord Ralf Dahrendorf put it very clearly when he said “For the resolution of conflict by negotiation, and for engendering a habit of peaceful co-operation, the European Union is seen by many as a model. And Britain must be part of that model.” It already is and there’s every reason to stay. Our conclusion is unequivocal. The UK is much stronger as a part of Europe, and Europe is much stronger with the UK as a driving force. There is no upside for the UK in Brexit. Only costs that can be avoided and advantages to be seized by remaining in Europe. No one should have to pay the Brexit tax.

Thank you!

Donald Tusk believes strongly that the United Kingdom needs Europe and that Europe needs the United Kingdom

Donald Tusk, President of the European Council, has written a report in which he looks back at the European Council’s work since he took up office on 1 December 2014, and provides his personal account of the main decisions taken by European leaders since then.

Following is an extract about the UK and Europe looking for positive and constructive solutions. It does not mention the destructive expression of “brexit”.

“Last November, I received a letter from Prime Minister Cameron setting out four specific areas in which the United Kingdom is seeking and proposing reform: on economic governance, on competitiveness, on sovereignty, and on social benefits and free movement.

In response to the Prime Minister, I made it crystal clear from the very beginning of the process: we would do all in our power to meet Britain’s concerns but we must not compromise the values and basic principles of the European Union, including — but not only — freedom of movement and non-discrimination. My initial consultations with all other member states fully confirmed this stance although there was also great good will to find a solution that would secure Britain as an EU member. I aimed at settling the matter as quickly as practicable.

After consulting more widely, I first set out in detail the possible terms of a UK re-negotiation in a letter to leaders in early February 2016. I then undertook an exacting schedule of visits to national capitals around the European Union to hear individual concerns on a draft text. Even with this careful preparation, the February European Council that followed was as difficult as any of my term. During our long and often heated discussions, we haggled over the smallest details of the deal. It was not an aesthetic spectacle, and far from glamorous. But the important point was that no member state walked away from the table.

In the end, the 28 heads of state or government unanimously agreed and adopted a legally binding and irreversible settlement for the United Kingdom in the EU. We agreed to do this in a way that does not compromise the European Union’s fundamental values such as the freedom of movement or the principle of non-discrimination, and without compromising the future development of the Economic and Monetary Union. The deal recognises, strengthens and protects Britain’s special status in the European Union. But it does not do this at the expense of others.

Even though we found a common solution in the end, the real test is ahead of us. Only the British people can and will decide the future of the United Kingdom in the European Union. It is my dearest hope that they agree to stay, as there is so much potential benefit for the EU and the UK in remaining together, both in terms of our mutual prosperity and security in the world. I am deeply committed to seeing that potential realised and look forward to working with an engaged Britain in a reformed European Union.”

Winston Churchill wanted to build a strong European Union. Do the British now want a strong Europe?

Winston Churchill, twice British Prime Minister (1940-45 and 1951-55) is considered one of the Founding Fathers of the European Union. When the 2^nd World War had ended he was one of the first to call for the creation of “something like the United States of Europe”. He did it in a speech to the students at the University of Zurich in 1946 and made such call “to re-create the European family, or as much of it as we can, and to provide it with a structure under which it can dwell in peace, in safety and in freedom”, he said. “We must build a kind of United States of Europe.” Why? To prevent the atrocities of two world wars from ever happening again, and to avoid egocentric nationalisms which were the causes of the wars.

Two years later in The Hague, in 1948, 800 delegates from all European countries met at a big Congress of Europe, with Churchill as honorary president. The following step was the creation of the Council of Europe on 5 May 1949. Winston Churchill attended its first meeting. He was even in favor of a European army. As we can read on the website of the EU, Winston Churchill became a driving force behind European integration and an active fighter for its cause.

Churchill’s name figures on the list of the “Fathers” of Europe together with Konrad Adenauer, Joseph Bech, Johan Willem Beyen,  Alcide De Gasperi , Walter Hallstein, Sicco Mansholt, Jean Monnet, Robert Schuman, Paul-Henri Spaak and Altiero Spinelli. They had all the same ideal of a peaceful, united and prosperous Europe. A united Europe was the only way.

“We need to show the same political courage and vision of Winston Churchill,” said José Manuel Durão Barroso at a Special Churchill Lecture at the University of Zurich on 8 November 2013, titled ‘From 1946 till today – a European success story – Why leadership matters’. “Churchill, a committed and far-sighted British-European, followed up, notably with the Hague congress in May 1948, which was convened with the specific objective of promoting a united Europe and was attended by eminent personalities from across the political spectrum, such as Monnet, Adenauer, Spaak, Spinelli, de Gasperi, de Madariaga and de Rougemont, to name but a few of these ‘founding fathers’”, Mr. Barroso said. “Sixty seven years after Churchill’s Zurich speech, Europe is now reconciled and reunited. Europeans are bound together through their shared values and principles. And the great historic novelty is that this was achieved not by wars and force but through a ‘choice for Europe’ and through a supranational framework, with common institutions exclusively obliged to uphold the European interest and safeguard our founding values.” … “We should be inspired by him (Churchill)” Barroso finished his speech saying” We should look beyond immediate issues and agree on a long-term vision for Europe.”

Churchill contributed together with the other fathers to lay the foundations of the EU. If Churchill would be here now, would he vote to leave the EU, his “European family”, betraying his ideas? Or would he try to make the EU stronger together with the other European leaders? Brexit is an escape. It was not Churchill’s character to escape from the problems.

 

When Britain liked Europe and Europe liked Britain

I was 9 years old when the British troops entered my city, Brussels, and freed it from the German occupation. I remember the tanks of the 30th Corps coming into my street and my neighbors welcomming the British soldiers. For us it was the beginning of the end of World War II.

I remember me visiting the British soldiers with my friends in their tents near my home. And the soldiers giving us cookies. And British trucks distributing white bread to the people in the streets. (We hadn’t seen any white bread during the German occupation).

Many homes invited a “Tommy” (as we called the British soldiers) for lunch or dinner. Same did my parents. These “Tommies” were prepared to sacrify their lives for us.

My children and grandchildren have passed their vacations in Britain, to learn english and make friends. English is an important, maybe the most important language in Europe and in the world. All European schools are teaching English.

Now UK Prime Minister David Cameron has announced a referendum, on Thursday 23 June, whether Britain should remain in the European Union or leave. A democratic decision, of course.

But I would feel sad if the UK decided to leave. Europe would be broken. An Eurotunnel was build tu connect it. Should we then learn another language instead of English?

There would be two losers: Great Britain and Europe.

We should not forget the reasons that moved Europeans to build a United Europe.