The negotiations over TTIP and Brexit

A likely failure is heralding a second one!

 

The recent hullabaloo surrounding the TTIP could be a foretaste of the problems facing the forthcoming Brexit negotiations.

 

If one can legitimately believe that “no agreement is far preferable to a bad agreement”, one should, nevertheless, examine the reasons that make it so difficult to bring such discussions to a successful conclusion: in this particular instance, leaving aside the relevance of the arguments presented by both partisans and opponents of the TTIP, it would appear that it is the process itself that should be blamed. Indeed it attempted to put on opposite sides of the table the Government of the USA the representing the world’s most powerful entity of  50 federated States and the European Commission mandated by European Council, representing 28 Member States, who collectively are more populated and economically more powerful

 

There exists, however, a structural imbalance between the constraints weighing on both parties. The first must seek ex post ratification by the sole American Congress while the second needs the unanimous consent of its 28 sponsors. Any positive outcome is necessarily the result of a series of compromises in which everyone is supposed to find some benefits but the party who speaks with a single voice will nearly always win the argument over the one who is prisoner of previously agreed compromises limiting his negotiating flexibility. Failure will become inevitable if some individual sponsors feel free to intervene unilaterally and publicly in the debate, expressing definitive postures while talks are still underway.

 

Those who are tempted to rejoice in the failure of the TTIP should not brag too loudly because there is an important lesson to be learned: it demonstrates the intrinsic weakness of the European “intergovernmental” architecture which is unable to promote the interests of the Union as a whole. This contributes to the rejection by the citizen of an “ever closer Union” which is required if Europe is to provide for its own security and prosperity.

 

A similar pattern can be anticipated with regard to the future Brexit negotiations which seem all the more compromised that both parties (1 versus 27) were taken by surprise and have so far failed to determine their respective negotiating positions. There is further confusion concerning the exit talks which will be decided by qualified majority voting and bargaining concerning future EU-UK relations which require unanimous approval of the 27. Linking the outcomes of both sets of discussion would more than likely lead to exceeding the 2 year timeframe imbedded in Art.50 of the TEU, in which case the UK  would be automatically relegated to the status of a “third country” in relation the surviving EU. The uncertainty surrounding the status of millions of British and Continental expatriates would be unnecessarily prolonged while, simultaneously, vital corporate decision-making would be differed; this would impact negatively both consumer spending and employment dampening growth needed to sustain any economic recovery.

 

Now that the Government has reiterated its commitment to the irreversibility of Brexit, the British should concentrate on seeking the most beneficial deal possible. One should forget scenarios that call constantly for reconsidering the decision each time a new statistic is published as being irrefutable proof that Brexit is either a success or a disaster! However, the British should also integrate the fact that the decision they took (democratically) does not hold sway in any way over their former partners, except their obligation to conform to treaty provisions.

 

From the EU’s standpoint, the absolute priority must be to progress diligently with its own reforms so as to counter the risk of contagion created by Brexit which is being cleverly exploited by Europhobe and populist parties. One should also avoid at all costs allowing Brexit negotiations to become the platform for EU reform (as unhelpfully suggested recently by the Think Tank Bruegel recommending the creation of a “Continental Partnership”). The complexities of implementing such an ambitious plan is bound to create deep divisions between the EU 27 that “perfidious Albion” would be quick to exploit. It would lead inevitably to the breakdown of the negotiations. Furthermore, failing to reform the EU would render Brexit negotiations pointless.

 

Listening to the contradictory rhetoric and posturing of politicians, the failures of both the Brexit talks and EU reform seems quite likely. Should that come to pass, any hope of building a Union founded on the principles of democracy and solidarity would quickly vanish leaving the field open to its ultimate implosion. The spectre of the 1930’s would resurface, the souvenir of which has been largely wiped out of popular memory and its reoccurrence thought to have been removed once and for all after the catastrophe of WWII.

 

Brussels, 2nd September 2016

 

 

Paul N. Goldschmidt

Director, European Commission (ret.); Member of the Steering Committee of the Thomas More Institute.

 

 

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