Thursday, January 19, 2017

Guest Post: Brexit and Its Consequences

We are pleased to publish this guest post by  Tom McDonnell who is a Professor of Law at the Elisabeth Haub School of Law at Pace University.

The United Kingdom vote last June to leave the European Union shocked then UK Prime Minister David Cameron, the so-called London elites, a large portion of the UK public, and the other EU countries. Brexit also presaged the success of Donald Trump in the United States. Theresa May, installed as UK Prime Minister in Cameron’s place, is now talking about a “hard Brexit” and is saying that she soon wishes to invoke article 50 of the Lisbon Treaty, the EU exit provision.

The Referendum

On January 7 at the Annual Meeting of American Law Schools in San Francisco, a panel of experts analyzed Brexit and its likely consequences. Darren Rosenblum, a professor at Pace University’s Elisabeth Haub School of Law, questioned the wisdom and validity of making such a momentous decision by a narrowly passed referendum. The vote was 51.9 percent to 48.1 percent. Timothy Nelson, a partner at the law firm of Skadden, Arps, observed that the 51.9 percent majority represents about 37 percent of UK voters, from mostly the British equivalent of US’s flyover states.  He criticized the manner in which the referendum was worded, comparing it to the Pepsi versus Coke test, but leaving out the Coke.  The wording looks facially neutral:  “Should the United Kingdom remain a member of the European Union or leave the European Union?”  His point appears to be that the question hardly helped the voter to understand the consequences of the choice.


From a trade perspective, Attorney Nelson and Roger Goebel, a Fordham Law School professor, noted that, on leaving the European Union, the UK would lose its free trade rights with the other 27 European Union members, and its goods and services would be subject to an average 4 percent tariff under the World Trade Organization. They predicted, as others have, that this result would deleteriously affect London’s finance and banking industry. Professor Goebel believed that EU organizations in the UK, organizations that employ a considerable number of Britons, would be transferred to other EU states. He did characterize as “good news” that Britons working in EU institutions in other parts of the EU apparently will not be discharged.

 Racism and Immigration

A member of the panel criticized the Brexit vote as stemming from racism, particularly towards immigrants. Hate crimes were reported to be up 57  percent in the UK within four days of the vote. While more immigrants have moved to the UK, Attorney Nelson observed that thousands of Britons moved to other EU countries. Some commentators have noted that when the EU expanded to admit poorer countries like Poland, which paid their workers on average far less than more developed EU states, unsurprisingly a large number of people from the poorer countries immigrated to wealthier EU jurisdictions, like the UK.  Since 2004 when Poland was admitted, more than 800,000 Poles have moved to the United Kingdom, with 65 million inhabitants.  Professor Goebel predicted that the EU in the future will limit free immigration among the EU member countries.

Scotland and Northern Ireland

Attorney Nelson noted that Scotland voted by 62 percent to remain in the EU and Northern Ireland so voted by 56 percent.  He predicted that should there be a “hard Brexit,” Scotland would likely move towards independence.  Both Scotland and Northern Ireland have sought to participate in the case, discussed below, questioning the government’s power to leave the EU.

 The United Kingdom Supreme Court

A lawsuit pending in the UK Supreme Court has challenged the Prime Minister’s authority to invoke article 50 without first obtaining the consent of Parliament. The British High Court (which is below the UK Supreme Court) ruled in November that the British ministers did not have the executive power to invoke article 50.  The government appealed to the UK Supreme Court, which just announced that it will deliver its judgment next Tuesday, January 24. Should the UK Supreme Court affirm, it is expected that Parliament will nonetheless vote to leave the EU. A British law professor in the audience at the panel discussion urged the Conservative Party leadership to let the members of Parliament vote their conscience rather than hold them to the party line. He believed that a Parliament vote of conscience would result in the UK staying in the EU.

            Nothing seems certain about Brexit’s consequences except uncertainty. Brexit does harken back to rising nationalism, mistrust of elites, and, at a minimum, a discomfort with “the other.” As in the United States, governments need to address the economic impact of deindustrialized communities and the displacement of the average worker by automation and outsourcing while at the same time stemming attitudes and policies of exclusion and racial, ethnic, and nationality discrimination.

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