As Britain’s Theresa May inches closer towards a final Brexit agreement, for leaving the European Union, behind the scenes it is not quite the compromise politicians and the media make it out to be, says economist John Weeks
GREG WILPERT: It’s The Real News Network, and I’m Greg Wilpert, coming to you from Baltimore.
The Cabinet of Britain’s Prime Minister Theresa May approved a 500-page document on Wednesday detailing the agreement under which the United Kingdom will leave the European Union; a process commonly known as Brexit. It has been over two years since the British public voted in a referendum in favour of leaving the European Union; however, leaving the EU entails countless consequences for individuals, businesses, and institutions, both in Britain and in the EU. The vote sparked an extended period of uncertainty and controversy. As a matter of fact, shortly after the referendum vote, then-Prime Minister David Cameron resigned and was replaced by Theresa May. During the Brexit negotiations, seven cabinet members resigned one by one in protest over what they consider to be a disastrous deal. And shortly after last Wednesday’s cabinet approval, two more cabinet ministers resigned. Britain’s pound sterling subsequently dropped by two percent in value as markets reacted to the turmoil on.
The Brexit agreement now goes to Parliament and to the European Commission, which is scheduled to vote on it on November 25. The EU’s chief Brexit negotiator Michel Barnier praised the deal and explained that it was the fruit of joint negotiations.
MICHEL BARNIER: The two negotiating teams have taken their responsibility. The British government has taken today, this evening, its responsibility. And now everybody on both sides have to take their responsibility.
GREG WILPERT: Joining me now to make sense of the latest Brexit developments is John Weeks. John is professor emeritus of the School of Oriental and African Studies at the University of London. Also, he’s author of the book Economics of the One Percent: How Mainstream Economics Serves the Rich, Obscures Reality, and Distorts Policy. Thanks for joining us today, John.
JOHN WEEKS: Thank you for inviting me.
GREG WILPERT: So the Brexit agreement, which few have actually had a chance to read, is divided into three main parts, apparently; a financial settlement for the separation, the rights of British citizens living in the EU and of EU citizens living in Britain, and then the third part is about a mechanism for the border between Ireland, which is in the EU, and Northern Ireland, which is part of the UK.
So let’s start with the last point. Why has the border between Ireland and Northern Ireland become such a key stumbling block in the negotiations, and what do we know of the agreement now regarding the border?
JOHN WEEKS: Well, the … As you said, the vote on Brexit was over two years ago. And at that time Northern Ireland, which is part of the United Kingdom, part of the greater Britain, you might say, voted overwhelmingly in favor of remaining in the European Union. Ireland the country, or Eire, which is its formal name in Irish, is a member of the European Union.
So were it the case that Britain were to leave the European Union, and Northern Ireland were to leave the European Union, and not have an arrangement for trade, it would mean you need some kind of border between Northern and Southern Ireland to check goods coming across, to see if they satisfied certain health and safety rules of the European Union.
The importance of that is that, as probably many of your watchers know, for decades there was an active war going on in Northern Ireland which was supported by the government of Southern Ireland, to various degrees. Supported by the government of Ireland, I should say. Then several years ago, a peace arrangement was reached. And part of that peace arrangement was an open border.
So the arrangement in which all the British Isles would leave the trading arrangement with the European Union would appear to contradict the peace agreement between Northern Ireland and Ireland. Having said that, let me say I think that that is a problem that has been, for political reasons, blown out of proportion. I think there was always a solution to it, and they’ve come up with the obvious solution; they postponed it. But politically it was extremely important. Much more important, I think, than its practical consequences. I mean, in fact, there will be very few customs checks between Britain and the European Union in any case. But that problem has basically been resolved. We’ll discuss that more as we go into the other two parts.
GREG WILPERT: Yes. The British business community seems to be reacting favorably to the agreement. Of course, that involves the tariffs and the customs union issues. The Confederation of British industry, as a matter of fact, called it stepping back from the cliff edge. What scenario scared the British business so much, and why does this agreement appeal to them?
JOHN WEEKS: I know this is going to seem very strange to non-British listeners. In June of 2016 was the vote against remaining in the European Union. In April- well, actually, in March 2017, last year, the British government, Theresa May’s government, voted, put a vote through the House of Commons, to initiate the withdrawal process. That colloquially- it refers to, it’s always called Article 50. That’s in the European treaty.
OK. So, Article 50 set a date in those discussions of two years. Those two years come up next March 29. OK. So that’s not what’s pushing this. Now, all during that process it was clear- when I say all during that process, ever since the two-year deadline was set- it became obvious, I think, to any dispassionate observer that an agreement was possible, that the agreement would be pretty straightforward, and there were just a number of little details that could be very important to a particular country to sort out.
The tremendous amount of political tension grew up around it. I mean, the media coverage or Brexit, both the right-wing press and also the left-of-center press, the Guardian, have involved just terrible distortions. You would have thought it was a morality play going on; that leaving the European Union would result in Britain, you know, completely collapsing as a country; that staying in the European Union will lead to a loss of sovereignty, and so on.
But the reality was it was a pretty straightforward agreement. And that agreement is one the business community wanted. They have helped design this. I mean, the fact of the matter is this agreement is brought about by two major parties, or two major players, if I can use that cliche. German manufacturing capital, which wants to maintain access to the British market. German manufacturing runs a tremendous trade surplus with Britain across the board. That’s what’s- that’s the big player on the continent that want to sort out this agreement. And the big player in Britain that want to sort it out is British financial capital. So they didn’t really care what happened with the trade in goods. What they wanted was to be able to maintain their access to European financial markets so that what’s called the City of London, which is where all the big banks are, so that the City of London would be able to maintain its premier position in world financial markets…Read More at