Financial Nigeria Magazine

Is cancelling Brexit now inevitable

As matters stand today, a new British referendum on leaving the European Union would produce a clear majority for remaining a member, regardless of how the votes were counted or the questions were asked. And with the only two Brexit options set to be reje

- Anatole Kaletsky is Chief Economist and CoChairman of Gavekal Dragonomic­s. A former columnist at the Times of London, the Internatio­nal New York Times and the Financial Times, he is the author of Capitalism 4.0, The Birth of a New Economy, which anticipat

In times of political turmoil, events can move from impossible to inevitable without even passing through improbable. In early 2016, the idea of Britain leaving the European Union seemed almost as absurd as the next American president being the six-time bankrupt and serial sex pest Donald Trump. A few months later, Brexit and the Trump presidency were universall­y acknowledg­ed as the inevitable consequenc­e of an anti-elitist, antiglobal­ization backlash that was predictabl­e decades ago.

This sense of inevitabil­ity, far more than genuine anti-European conviction, is what has discourage­d Britain from changing its mind about a pointless and self-destructiv­e policy that few voters cared about until 2016. The message from post-Brexit polling and focus groups has been: “We all know that Brexit has to happen, so why don’t the politician­s just get on with it?”

But with the Brexit process now moving toward its climax, another outcome is moving from impossible to inevitable: Britain could soon change its mind and decide to stay in the EU. This reversal of fortune could begin this month, when Prime Minister Theresa May is expected to lose the decisive parliament­ary vote on her Brexit deal.

If and when this defeat happens, May will face two unpalatabl­e options. She could preside over a “No Deal” rupture with Europe – tantamount to a declaratio­n of economic war against the EU – and risk a 2008-level economic crisis accompanie­d by a border upheaval in Ireland that could reignite the “Troubles.” Or she could break her extravagan­t promises to honour the “people’s instructio­n” from the 2016 referendum and allow a new popular vote that might cancel Brexit.

To avoid this invidious choice, May could try one last time to push her proposals through Parliament after losing the vote scheduled for the week of January 14. But if this last-ditch effort fails, her choices will be reduced to a No Deal rupture with Europe and a new referendum.

With the options thus narrowed, the risks and sacrifices of the “horror,” as Britain’s main business lobbies now publicly describe No Deal, will quickly come into focus, and a bipartisan parliament­ary majority will surely converge to block this outcome. Several Conservati­ve MPs have already promised to resign from the party if May shifts to supporting No Deal, and the rebel numbers could certainly swell enough to bring down her government.

As the impossibil­ity of legislatin­g either No Deal or May’s deal has become apparent, the aura of inevitabil­ity that has protected Brexit from serious challenge since 2016 is vanishing, and soon the sense of inevitabil­ity may swing in favour of a new referendum. This shift has already started in the British media. Having spent the past two years denouncing anyone who challenged Brexit as “enemies of the people” and a traitor to democracy, the BBC, TheTimes, and other influentia­l media organs have suddenly remembered that an

essential principle of democracy is that voters have the right to change their minds.

But just as the “principled” objections to a new referendum are disappeari­ng, a much more practical problem has emerged: What question should be asked in a final “People’s Vote”? Should voters choose between remaining in the EU or accepting May’s withdrawal agreement? Or should the options be No Brexit versus No Deal? Or what about the narrower choice between May’s Deal and No Deal, demanded by Brexit zealots who argue that the possibilit­y of continuing EU membership was eliminated by the 2016 referendum?

The obvious answer would be to present voters with all three options – No Deal, May’s Deal, or No Brexit. But the problem then arises of how the votes should be counted if none of these options commands a clear majority. Under the first-past-thepost system used in British and American elections, the option supported by the most votes would win. But that would be completely unacceptab­le to Brexit supporters, who would be guaranteed to lose if their voters were split between May’s Deal and No Deal.

Thus, to gain democratic legitimacy, the votes would have to be counted either through a preferenti­al system, which asks voters for first and second choices, or with a two-stage process. For example, the ballot could first ask voters to state whether they accepted the government’s Brexit proposal, and then to answer a second conditiona­l question: If the government’s deal does not win majority support, would you prefer No Deal or remaining in the EU? Alternativ­ely, voters could be asked, first, whether they want to remain in the EU or go ahead with Brexit, and then, in the event that Brexit wins, whether they would prefer May’s Deal or No Deal.

The strongest objection to a second referendum is that the different counting systems could give very different results, at least in theory, thereby underminin­g the legitimacy of the entire process. But this objection turns out to be theoretica­lly valid only if public opinion is divided fairly evenly between the three possible outcomes. In practice, opinion now seems to be shifting to the point where clear answers are likely, regardless of how the questions are asked.

In the first detailed poll of all three Brexit options, conducted by YouGov in early December, a standard first-past-the-post vote would result in Remain winning a huge 54% absolute majority, against 28% support for No Deal and 18% for May’s Deal. In a simple choice against May’s deal, the majority for Remain would be even bigger, at 62%. And in a preferenti­al vote count that redistribu­ted the second preference­s of May’s supporters, Remain would still win by a decisive margin of 57% to 43%.

Of course, voters could change their minds in a referendum campaign. But as matters stand today, a new referendum would produce a clear majority for Britain remaining an EU member, regardless of how the votes were counted or the questions were asked. This suggests that the force of inevitabil­ity is starting to move against Brexit. “We all know that Brexit has to be cancelled,” voters may soon be saying, “so why don’t the politician­s just get on with it?”

 ?? Anatole Kaletsky ??
Anatole Kaletsky
 ?? UK Prime Minister Theresa May in Parliament ??
UK Prime Minister Theresa May in Parliament

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