Brits Could Have a Brexit Cake and Eat It Too
By Pierre Lemieux
In an essay on “The Great Brexit Breakdown” (Wall Street Journal, December 7, 2018), Gerard Baker quotes the director of a London-based think-tank:
“You can have national sovereignty—and that’s fine. Or you can have economic integration—and that’s fine. But you can’t have both,” says Mr. Grant.
This is true if “national sovereignty” means that the national government has the right to control its subjects’ decisions to become integrated to the world economy, that is, to import to from or exporting to other countries. In other words, the dilemma is true if “you” refers to a very controlling national ruler. Otherwise, it is not.
To see this, imagine that “national sovereignty” means something completely different from its accepted definition, something closer to Anthony’s de Jasay’s “capitalist state” than to the authoritarian state. De Jasay’s capitalist state is a state whose only function is to prevent other states from taking over the country and oppressing its customers (citizens or residents). Perhaps such a state could even assume the quasi-contractual production of other public goods and services, as in James Buchanan’s contractarian theory, but it would need to be strictly limited. For our purpose, it suffices to imagine that Britain’s post-Brexit state does not claim to determine how its citizens will “integrate” or not, and with whom. (My formulation assumes that Scotland and Northern Ireland would secede following Brexit; if you don’t agree, just substitute “Britain” with “the United Kingdom.”) Then “you,” British citizen, could have both national sovereignty and economic integration—if you individually want that.
What I have described is as simple as it is ignored in the generally collectivist perspective of public debates. It is called unilateral free trade. (I have blogged a number of times on this topic here.) Under this regime, any British resident would have the right, as recognized by his own government, to establish (nearly) any relation he wants with a resident of the European Union (or other countries), whether it is import, export, marriage, investment, etc., provided that his counterparty is willing and allowed to conclude the agreement.
The term “allowed” must be emphasized. A British resident might want, for example, to export something to a E.U. resident who is prohibited by the E.U. government from importing it—or from importing it without paying a tax (a tariff) that ruins the deal. This would be most unfortunate, but it is more a problem for the E.U. resident, whose liberty is infringed, than for the British resident, who could try to export elsewhere. Moreover, since the European Union’s imports must be equal to its exports—or else E.U. residents will be flooded by pounds sterling that they will want to invest in Britain—British residents will be able to export much more than stiff-lip continental mercantilists would like.
It is true that this argument does not solve the problem of the free movement of people, which many Brits and Europeans value in the current European Union. But perhaps the British government could also give the example in this area, by allowing reasonable movement of foreigners on British soil. “Reasonable” means that the declaration of freedom to import goods, services, and capital–which is the definition of unilateral free trade–could include some liberal restrictions on immigration. As in the case of unilateral free trade, liberty would arguably be more contagious than tyranny. At least we have some reasons to hope so.
So the Brits could have Brexit and eat it too, in the sense that a non-authoritarian “national sovereignty” would be maintained and they would be free to individually integrate with Europeans. There is no such thing as a free lunch, so what would be the price? The price of this sort of Brexit cake would be a decrease in state power: the European Union’s government would lose power and the British government would not fill the vacuum. This price would be paid those who like to rule and those who count on the rulers to exploit others on their behalf.
Although British libertarians would like this solution, many others, probably most others, would not. There is some evidence that individuals with authoritarian values were much more likely to vote Leave than Remain. An interesting report by Kirby Swales of NatCen, Understanding the Leave Vote, concludes:
People identified as ‘authoritarian’ were significantly more likely to vote Leave than those identified as ‘libertarian’, 66% compared with 18% respectively (see Figure 9).
I am grateful to Mark Brady for reminding me that one may disagree with the way “authoritarian” and “libertarian” are defined (see p. 28). Yet, it seems to me that many if not most of the questions (from the standard British Social Attitudes survey) that served to define the two terms “authoritarian” and “libertarian” are indicative of what we usually mean by them. It also seems to me that much anecdotical evidence suggests that, if many libertarians favor Brexit, authoritarian bigots outnumber them by far. Many Brexiters hope that European regulations and controls, currently integrated into U.K. law, will be maintained, with a nativist vengeance. Stephen Filder of the Wall Street Journal (“Brexit Upends British Political System,” December 10, 2018) observes:
[Brexit] also attracts people on the left of the main opposition Labour Party, who see the EU as shoring up corporate capitalism and constraining nationalization.
Most Brexiters certainly have no clue about unilateral free trade, which they would probably instinctively abhor. They don’t want to have their cake and eat it too, or have no idea how to do that.