How The Brexit Vote Could Save the EU

The temptation for the European Union will be strong. Confronted with one of its members taking the unprecedented decision to leave the bloc, why shouldn't the EU treat departing Britain like a pariah? The scorned EU could decide to impose trade tariffs and other punitive measures, making it clear to any other restive European electorate just how isolated any exiting nations will be.

But while there is anger and a sense of betrayal in Brussels, the EU's headquarters, some officials there and in other European capitals worry that a hard-line approach could alienate EU member states that have reservations about the European project. As the sense of shock at Britain's June 23 vote to leave the EU ebbs somewhat, a growing number of European politicians are suggesting it might be wise to take a more accommodating approach in future negotiations over Britain's departure. Implicit in that softer attitude is a recognition that the British aren't the only voters in the bloc who feel the EU is a burden rather than a help.

"Most of the member states, and the EU institutions, do not want to set a bad precedent," says Jan Techau, director of the Brussels-based Carnegie Europe think tank, referring to the wish to deter other political parties from calling for referendums. "But they don't quite know what that means and how to achieve this—is harshness the right way, or is softness the right way?"

It will be a challenge for a bloc that has faced more existential challenges in the past few years than at any time in its history. First, there was the eurozone crisis and the prospect of a Greek exit from the single currency. Then, last year, the arrival of a million refugees seeking sanctuary from persecution, war and poverty sent the EU into disarray. Now, in the aftermath of the Brexit vote, there is a growing sense of apprehension, as no one knows when Britain will formally ask to leave the EU. The much-battered, deeply irritated EU will now have to summon considerable self-restraint to reach a deal with Britain that heals wounds rather than deepens them.

At least the EU knows whom it will be dealing with. The ruling Conservative Party has swiftly chosen a new leader to take over from David Cameron as prime minister, and there is relief in Brussels that his successor is Theresa May, a familiar and respected face there during her years as Britain's home secretary. May is now under pressure to make peace between the Leave and Remain factions in her party and to present a plan to Europe.

European politicians are hoping May will swiftly trigger Article 50 of the Lisbon Treaty. That would mark the start of two years of negotiations to set the conditions on which the U.K. will formally withdraw. Those talks will cover everything from a renegotiation of fishing quotas to the status of EU citizens living in Britain.

Europe's leaders have already been pre-empting likely British demands. A week after the referendum, the EU's trade commissioner, Cecilia Malmström, said no new trade deal could be negotiated until after the two-year exit process. That raised the prospect of prolonged tariffs on goods and services that would theoretically begin the day the two-year period ends. If that happened, prices in Britain could go way up—and for how long would be anyone's guess.

The hardball stance is also evident in the key point of contention between the Leavers and Europe. EU heads of government and institutional leaders have made it clear that Britain cannot hope to retain access to the EU's tariff-free single market without allowing EU citizens to work in the U.K. "There will be no single market à la carte," Donald Tusk, president of the European Council, said in late June, after the EU's first summit following the Brexit vote.

Given that curbing immigration was one of the deciding factors in the Brexit vote, it remains unclear how a British government could compromise on this—but it would be equally impossible for Brussels to capitulate on one of the EU's most valued principles.

Brexit demonstration
People hold banners during a demonstration against Britain's decision to leave the EU, London, July 2. A survey shows that Britons are actually happy with Brexit. Paul Hackett/Reuters

The bad news from Brussels doesn't stop there for Britain's new prime minister. The EU could roll out plenty of other retaliatory measures. As well as trade tariffs, there is the question of what to do with the 1.3 million British passport holders living and working elsewhere in the EU. French officials have threatened to stop allowing British officials to perform immigration checks around the French port of Calais, where thousands of refugees and migrants wait while hoping to cross into the U.K.

Britain has another problem: It doesn't have many friends left in Europe. Over the years, the goodwill among the more powerful members toward Britain ebbed away as Cameron seemed to use Brussels as a scapegoat for domestic problems. And the country has always been something of an outsider in Europe, a frequently reluctant member aloof from much of the process of further EU integration. It is not part of the 26-nation, passport-free Schengen zone, it had an exemption from future membership in the euro currency, and it had opt-outs from policy related to justice and home affairs.

Since the result of the Brexit vote was announced, that isolation has deepened. Some members of the European Parliament have asked their British colleagues to consider abstaining from voting on all matters, says Richard Corbett, an MEP for the Labour Party. British MEPs—there are 73 in a house of 751 seats—have politely declined that offer.

Corbett says other MEPs, particularly those from France, are also lobbying for the British to be frozen out of powerful positions like that of Parliament rapporteur, who takes responsibility for the passage of a piece of legislation through the house. When a new round of appointments to parliamentary committees begins in early 2017, no one is expecting top jobs to go to the British. "It logically stands to reason that if you are seen as somebody who is about to leave the room, you've got your eye on the exit door; you are not going to be as influential," Corbett tells Newsweek.

But Britain does still have friends among many of the newer EU members. Some of those countries are similarly unenthusiastic about the deeper-integration mantra of the founding clique and feel they have lost a powerful ally. Poland, Hungary, the Czech Republic and Slovakia have all resisted policy diktats from the European Commission in recent years. Meanwhile, in countries like the Netherlands and France, many voters are as hostile to the EU as Britain's Leave voters. Speaking on July 2, former Polish Prime Minister Jaroslaw Kaczynski warned that treating Britain as a pariah could lead to the "breakup of the union."

Europe's politicians appear to understand the risks of coming down too hard on Britain, with German Chancellor Angela Merkel changing her initial uncompromising tone and calling more recently for "a positive agenda, and positive goals, [to] try to show that we have an ambition and an aspiration to produce prosperity for our people."

Chris Bickerton, author of The European Union: A Citizen's Guide, says the challenge now is to find a powerful political message that would counter the anti-EU parties—and prevent the lukewarm Eastern European member states from edging away from the EU. "The Euroskeptics have a plan, they have an idea, they have a vision of what they want Europe to be, and it doesn't really involve the EU," he says. "It is not clear that the EU institutions have a vision that takes that on."

That lack of vision has allowed different theories to emerge in Brussels about what shape the EU will take—both in relation to the Brexit vote and more generally. On July 11, for example, Austrian Finance Minister Hans Joerg Schelling suggested a "Brexit-lite," where Remain-voting Scotland and Northern Ireland would stay in the bloc. Guy Verhofstadt, a former Belgian prime minister and leader of the bloc of trans-European Liberal MEPs in the European Parliament, tabled a motion on July 13 proposing a two-tier EU in which core members further integrate and more skeptical countries like the U.K. get an associate status, where they can sign up to some of the EU's policies. That's unlikely to ever happen—but the discussion of such a plan is a sign of the union's instability.

The EU's leaders have had some reason to feel optimistic, however, in the days since the U.K.'s June 23 vote. Half a dozen post-Brexit polls have shown a rise in support for pro-EU policies in nations including Germany, the Netherlands, Austria and Denmark, defying predictions from analysts across Europe of a Brexit domino effect. Faced with rising uncertainty and watching as political and financial turmoil engulf Britain, some Europeans seem to be deciding that sticking with the EU is the safest option. If the rest of the EU countries can overcome their differences and finally listen to their citizens, the greatest blow to ever fall on the union could end up being the catalyst for its salvation.