Brexit could save economic liberalism
Even out of the single market and the Customs Union, Britain will probably be more open to free trade in 10 years’ time than it is today
evolutions can be gradual, slow-motion affairs or abrupt, dramatic ruptures. It can sometimes take decades before anybody even notices that everything is about to change: The internet, invented in California in 1969, is a case in point. The dramatic rise of the emerging markets, and relative decline of the old western powerhouses, with all the accompanying geopolitical implications, is another. Other shifts happen remarkably quickly, within weeks, days or even minutes.
Members of my generation can remember three such worldchanging moments: There was the collapse of the Berlin Wall in 1989, the West’s sudden, stunning victory in the Cold War and the Soviet Union’s implosion; the 9/11 terror attacks in 2001, which changed attitudes permanently and triggered multiple wars; and the financial crisis of 2007-2008, which briefly looked as if it would take down the global economy and ended up inflicting immense long-term costs on western economies. We can now add a fourth big moment, or rather a brace of events: Brexit and the election of Donald Trump as the President of the United States, heralding the return of the nation-state as our central political unit and the demise of the transnational, undemocratic technocracies that had accrued so much power in recent years.
The fall of the Berlin Wall was about choosing between two completely different systems, totalitarian Communism or liberating capitalism; Brexit and Trump are about how better to govern the latter. It is an internal debate within capitalism and the post-1990 world, not a rejection of it: An attempt at dealing in a different way with globalisation, technology, the mass movement of people and international terrorism. Brexit, in particular, is also very much an anti-establishment shift: The age of deference is over and the majority want their interests and values to matter more than those of cultural and political elites. We now all know that the first phase of the post-Cold War world — the early 1990s — was an aberration, a time of blind optimism, a belief in the end of history, the peace dividend, permanent economic growth and a fanciful European project.
For decades it was US foreign policy to build a united Europe — first to prevent another war, then to fight Communists, and latterly because the US State Department fell in love with giant bureaucracies. The fact that the Trump administration, in one of the greatest U-turns in American history, now openly wants to undermine the European Union is an astonishing change.
Moderate form of nationalism
It is thus almost impossible to exaggerate the importance of the events of the last week: First there were Trump’s explosive comments against the EU, Germany and much else besides, ahead of his inauguration; then British Prime Minister Theresa May gave the best, most powerful and most uplifting speech I’ve ever heard a British prime minister deliver. The referendum wasn’t a dream: Britain is actually leaving, a move that will redefine international history for decades to come. Crucially, the plan is for the most open possible Brexit: May has dramatically moved on from her past equivocation and has embraced free trade and an open society. She understands that globalisation is under threat, but she wants to use a moderate, liberal form of nationalism to rescue it. She wants the United Kingdom to continue to accept migrants, but realises that controls are the only way to prevent the growing backlash.
My bet is that — even out of the single market and the Customs Union — the British will be more open to free trade in 10 years’ time than it is today. China sees Brexit as an opportunity to buy into the UK but Beijing is deeply concerned about Trump, his protectionist rhetoric and his views on Taiwan. India is also watching carefully, as are all serious nations across the world.
Yet, the EU has nothing useful to say. It cannot think, it cannot act and it cannot change.
German Chancellor Angela Merkel’s attempts at global leadership to date have been disastrous, to say the least. But she is Europe’s last chance: She needs to accept that the EU, as currently constituted, is doomed and find a way of working with whoever becomes the next French president to overhaul the organisation. It’s either that, or the death of the EU. As for Britain, bring on the Brexit revolution. Allister Heath is a noted British journalist and commentator. He is currently deputy editor of the Daily Telegraph.