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Forum on Geopolitics Triple Bill on Brexit Report

last modified Jun 06, 2017 09:12 AM
The University of Cambridge’s Forum on Geopolitics is pleased to present this report of a series of three events held in May focusing on Brexit as part of its “Britain and Europe” research projects.

The British-European economic relationship after Brexit

 YouGov’s Director of International Projects, Marcus Roberts, opened up this spring’s Triple Bill lecture series by presenting the latest annual results from an ongoing survey collaboration between the Forum and YouGov, tracking British attitudes to the perceived Brexit effect on the UK’s economy and position in the world (the 2016 survey here and the 2017 follow-up here). Roberts suggested that while the Brexit vote ended up as 52/48, post-referendum politics have settled into a less even balance, with the rise of the “Re-Leavers” –  namely those who voted to Remain in the EU but think the government now has a duty to leave. A Tory victory in June, Roberts indicated, would further indicate that many voters now accept the reality of Brexit, at least in principle, despite potential negative consequences. According to the findings, roughly four in ten think Brexit will leave both Britain and Europe worse off economically, and nearly four in ten think Britain will have less influence globally after Brexit. It is, according to Roberts, an example of British resilience and a “just get on with it” attitude. 

In the main billing, a lecture entitled ‘The Cost of No Britain’, Prof. Clemens Fuest of Ifo focused particularly on the trade relationship between Britain and the EU, noting that 44% of British exports go to EU member states such as Germany, France, and the Netherlands. Similarly, 55% of British imports come from the EU. Having highlighted the particularly intertwined nature of trade relationships between Britain and the EU, Prof. Fuest advocated for a ‘deep and comprehensive’ Free Trade Agreement between Britain and the EU, but noted that negotiating such agreements takes anywhere from 3-10 years. As such a timeline does not comport with the two year window stipulated under Article 50, Prof. Fuest expressed hope that the parties might agree to a longer ‘divorce’ period in order to better enable such negotiations. 

Effects on Real GDP
Table generously provided by Professor Fuest and Ifo

Prof. Fuest further outlined four possible Brexit scenarios, highlighting that the two hard Brexit scenarios would mean either (1) that World Trade Organization (WTO) rules would govern relations between the EU and Britain or (2) that relations between Britain and the EU degrade to such an extent that the parties escalate to non-cooperative trade policy instruments provided by the WTO. According to the ifo trade model, all four of these scenarios would leave Britain decidedly worse off than the EU 27, which, as highlighted above in YouGov’s work, the British public appears to understand. Nevertheless, EU states would need to increase their EU contributions or face spending cuts in order to make up for any shortfall caused by Brexit. Cuts in spending would most negatively affect Poland and other countries on the EU’s eastern border. Despite these considerable costs for the EU, Germany and France’s priority of keeping the EU 27 together means, according to Fuest, that they will most likely be willing to contribute more to the EU budget.

Sir Andrew Cook, a major and veteran British industrialist, provided a response that detailed the challenges he had initially faced with EU trade law in particular, noting that he had not initially been a supporter of joining the EU. The EU, noted Cook, had not always provided the legal recourse it had promised businesses. Nevertheless, Cook highlighted that while he had been disappointed with the outcome of the vote, he, too, was sure the British would survive despite Brexit.

 

Rethinking the European Order in the Age of Trump and Brexit

Former German Foreign Minister and Vice Chancellor Joschka Fischer began his lecture by highlighting many of the dramatic changes that distinguish the twentieth century, including astronomical population growth and the changing role of China and India in geopolitics. Fischer stressed that the world outside of Europe may not be interested in Europe’s future, and that Europe is facing a potential decline in relative and absolute influence. Nevertheless, Fischer warned against the dangers of abandoning the EU model and returning to a state-centric model. This state-centric model, argued Fischer, had once forced Britain to the forefront of the fight against Nazism and fascism in Europe, and later Britain, along with the United States, to found the North Atlantic Alliance in order to guarantee European security.

Fisher posited that Brexit was the first of three attacks on Europe, followed by the increasingly isolationist stance of the United States. According to the former Vice Chancellor, President Trump’s stance on NATO serves to further undermine the security guarantees in Europe. The third attack, symbolized by the far-right threat in France’s recent election, was recently stymied. The election of Macron, noted Fischer, helped steer the EU away from complete disaster and created havoc on the continent.

On Britain’s exit, Fischer stated: “We know how to make an omelette out of eggs, what we don’t know is how to make eggs out of an omelette.” The fact that Britain is not a member of the Eurozone means that this process is only slightly less complicated than it might otherwise be. On the neutralization of debt Fischer noted that the question is not if, but instead when and how, as neutralization will be integral to stabilizing the Euro. Should Macron and the European Union fail to take significant steps in this process, the European Union will face a second wave of hyper-nationalist candidates in elections. Fischer cited the conflict in the Balkans, or “the old ghosts of European nationalism”, in order to warn against the potential consequences of such catastrophic destabilization in Europe.

Fischer closed by again highlighting the importance of stabilizing the Euro as well as  investing in European security so as not only to combat growing terrorist threats, but also to prevent Russia from continuing to exert a zone of influence intended to destabilize its neighbors and undermine the EU’s influence.

 

Brexit and Trump in Light of History and Network Theory  

As with Fischer, Professor Niall Ferguson, a senior fellow of the Hoover Institution, Stanford, and the Center for European Studies, Harvard, began his presentation also by highlighting change: an increasingly networked world. Ferguson noted that ‘Technoptimists’ such as Twitter co-founder Evan Williams had once believed that the rise of cyberspace would better allow free exchange and ‘automatically’ improve the world. According to Ferguson, such techno-utopianism and cyber-optimism illustrate a general misunderstanding of networks and ignorance of network theory. Network theory, according to Ferguson, has wrongly been relegated to the fringes of most research on politics and political history. This is partly due to the fact that, despite the ubiquity of networks, historians tend instead to focus on hierarchies, leaving the study of networks largely to conspiracy theorists. Hierarchies and networks are often understood as opposites, although Ferguson noted that in reality a hierarchy is a specific type of network, in which a central node controls access to all other nodes in the network. Adding only a few “edges” (links between nodes) can destroy the hierarchical structure of the network.

The Nixon-Ford Network, by Prof. Ferguson
Generously provided by Prof. Ferguson.

 Individuals such as Henry Kissinger (about whom Ferguson has already published one volume, with a second forthcoming) understood the growing importance of networks in the 1970s and positioned themselves as central nodes (or “hubs”) within networks.

Ferguson argued that the increasing importance of networks since the 1970s was not necessarily a function of changes in technology, noting that revolutionary events from the fall of Communism in Eastern Europe in 1989 to the 9/11 attacks of 2001 were carried out with relatively primitive technology. By around 2008, however, new information technology had created a far higher level of interconnectedness than previously possible. The financial crisis, as illustrated by the Bank of England’s chief economist, Andrew Haldane, is best understood as a network “outage”.

Understanding networks—in particular their structure—allows observers of contemporary politics and historians alike better to understand power and understand how to protect or disrupt the structures that institutionalize power. The events of 2016 – notably the British vote for “Brexit” and the election of Donald Trump – are best understood in terms of network effects.

 

 

In addition to the speakers, the Forum wishes to extend its thanks to Corpus Christi College, Cambridge, the Project for Democratic Union, Gonville and Caius College, and Dr. Anita Bunyan for their support of these events.

                                                                                                         

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