British ideas of Europe: PART 4. The UK’s view of a sustainable regime for Europe.

From the perspective of 2016, British voters in the referendum could be forgiven for thinking that the EU was not very sustainable. The Euro crisis was in its sixth year; Chancellor Merkel’s decision to welcome mass immigration into Germany undermined the Schengen agreement; Greece had been crushed by EU policy; youth unemployment in the Eurozone was stuck between 19 to 25%; in Spain and Greece, it was north of 40%; Italy had experienced zero growth since entering the Euro in 1999; northern European media described southerners as “feckless”; Merkel was portrayed sporting a moustache; the countries of central and south eastern Europe, were being lectured by Berlin and Brussels about their not following “European values” without any understanding shown that they were still struggling with the legacy of 45 years of enforced communism, following their terrible experiences during the world war. Polls showed the public highly critical of the EU.

Even so, when Cameron announced the referendum in February 2016, Remain enjoyed a 60:40 lead in the polls. He had won two  general elections, and the referendum of 2014 on Scottish independence. At his disposal was the Downing Street machine, Whitehall, the Cabinet and junior ministers. Most of the Tory party were either Remain or lukewarm about Leave. Remain enjoyed the backing of the EU, the Confederation of British Industries (CBI), senior civil servants and the heads of foreign governments. The Remain camp had access to vast amounts of electoral data, plenty of funding and top class PR. The economy was humming.

The one fly in the ointment was that after nearly three years of negotiations, the civil service had convinced Cameron that his deal was sellable to the British public. The deal stated that the UK  would not create obstacles to a further deepening of monetary union; if 16 national    parliaments objected to a draft EU legislative act, the other member states in the Council could consider the matter. Some minor concessions were granted on EU immigrant access to UK welfare benefits. But there was no concession on immigration: both Paris and Berlin insisted that free movement was a founding principle of the EU, and inviolable.

When Cameron presented the deal in the House of Commons, the mass circulation daily, The Sun, headlined “Who do you think EU are kidding?”[1]The Prime Minister then dropped the idea of campaigning for his deal, and launched “Project Fear” to reinforce voters’ preference for the status quo as the least risky option. This proved to be a major mistake: the threats did not wash with the public. Despite polls recording a small but steady Remain lead, the Leave camp won on a 72% voter turnout, with 52% for Leave and 48% for Remain.   London, Scotland and Northern Ireland voted heavily to remain. The rest of the UK voted solidly against.

Why the Leave majority? 

Disguarding allegations that Leave voters were ignorant, racist, nationalist, danced to the tune of the Murdoch press, or pocketed  Putin’s silver, there were a number of longer term factors that explain the vote:

  • By far the least credible is the allegation that Leave voters were nostalgic for Empire. The argument runs thus:“Euroscepticism has been inseparable from a nostalgic rendering of Britain’s past, from a desire to return to the “golden age” of British history-an age that was defined by British imperialism”, ..”and a habit of thought “that insisted that their country was set apart from others on the European continent..”[2]To put it mildly, this is nonsense on stilts. The argument that clinched the Leave victory was overwhelmingly encapsulated in the slogan: “take back control”.[3]Leave was a vote for self-governance, in other words a rebellion against empire, the very contrary of the allegation.
  • Much more grounded in evidence is the change in the UK’s economic structure since joining the EEC/EU in 1972. In 1972, the manufacturing sector represented about 30% of gdp, and accounted for an overwhelming share of foreign exchange earnings.  By 2015, manufacturing, at 10% of gdp, sent 47% of output to EU markets, down from 60% in 2000. Wealth was noticeably concentrated in London: the South East of England had per capita income 160-180% above the EU average.[4]By contrast, citizens in the rest of the UK had per capita income well below the EU average. The working class of northern England voted overwhelmingly Leave.
  • Immigration was the second major factor feeding vote Leave. Blair’s government in 1998 opened the UK’s doors wide to mass immigration, mainly from the sub-continent. This trend interpreted into the sharp rise in the fortunes of the anti-open doors and anti-EU UKIP. Nigel Farage, the UKIP leader, knowingly conflated European immigration-which fell under the EU’s free movement principle- , wage competition, pressure on public services and Islam. White voters and Christians voted 53 and 58% respectively to Leave; Asians, Black voters and Muslims voted 67%, 73%,  and 70% respectively to remain.[5]Voters had recorded concerns about immigration since Blair’s open door policy: the referendum was a once-in-a-lifetime chance to get their voices heard.
  • The global financial crash of 2008 slammed the reputation of élites. These were the “masters of the universe”, who had preached free markets, but had rushed to be bailed out at taxpayer’s expense at the first sign of trouble. Self-proclaimed “experts” had botched regulation, and made rubbish predictions. Among their patrons were the Big Beasts of British politics, who had backed EU membership for the past forty years. Then came the Euro crash in 2010, and the fall out between Germany and France on how to proceed. France, with the southern European countries, argued in favour of a joint Euroland insurance of debts; Germany insisted on no bail outs. The result was the eight year long European recession, sky high unemployment, the rise of “populisms”, and the revival of national antagonisms, the very opposite to the EU’s intent.

Defending the EU during the campaign was thus an uphill struggle. There was much to criticize, and less to celebrate. Brussels forever spoke of “the rule of law”, but the EU’s own rules were permanently being bent over budget deficits, and the permitted size of current account surpluses.  For decades, the EU’s own budget had not been signed off by the organization’s Court of Auditors. The EU had engineered the defenestration of Prime Ministers, and kicked Greece when it was down. Not least, Europe stagnated while the world boomed.

 The UK’s view for a sustainable European regime.

The heart of the UK’s ambivalence about EU membership has always been about EU membership as incompatible with the inherited right of the British electorate to select its own legislators. This was a central feature of the lengthy parliamentary debate of October 1971 on entry to the EEC. As the historian of those debates recounts: [6]

“He (Sir Derek Walker Smith, the Conservative MP) …concluded that EEC membership would pose a fundamental danger to a notion of Parliamentary sovereignty, thereby eroding a central feature of the way in which Britain had long been governed (Hansard, 28.10.1971, columns 2129-2136). Tony Benn, Michael Foot, Peter Shore, Enoch Powell, Edward du Cann, and Robert Taylor all presented variations on the same theme, albeit variations coloured by their highly divergent positions on the political spectrum. The populist ‘no taxation without representation’ slogan was invoked on several occasions, normally in reference to the introduction of Value Added Tax (VAT) that would accompany EEC membership but also sometimes more widely in the expectation that other forms of taxation would ultimately be affected by EEC entry (Hansard, 27.10.1971, column 1935). And multiple speakers attacked the Community for its bureaucratic nature and lack of democracy. A strong component of the anti-Marketeer case thus centred on the threat to Britain’s traditional habits of governance posed by the alien methods and goals of the Treaty of Rome.” (My observation: I do not know for the life of me what is populist about the slogan of “no taxation without representation”).

“Influence” on the world stage has always been a central feature of the Remainer position This was the case that Prime Minister Harold MacMillan advanced to the House of Commons in 1961  in proposing to join the EEC. Through the “pooling” of sovereignty, British influence would be augmented on the world stage. [7] As our historian of the October 1971 entry debates makes clear, it was central to the argument to join.  I quote his conclusion:

“In making this choice, parliament seemed to have been swayed more by the desire to see Britain continue to matter on the European and world stage, and by the hazy but oft-invoked appeal of greater prosperity and an exciting new future within an integrating Europe, than by the threat that EEC membership had been said to pose to several core British traditions. None of the passionate pro-European arguments had wholly demolished the concerns being raised about how Community membership might affect Britain’s long-standing tradition of feeding itself cheaply on liberally traded commodities, the UK’s multiple and deep-rooted links with many regions of the world beyond the European continent, or the country’s ability to govern itself wholly with laws made in Westminster. Nor, as events would prove, were the sceptics being purely alarmist in their dire predictions about the budgetary costs of EEC membership or the less than rosy short term future of Western Europe’s economy. But such considerations had ultimately been of less importance for those who voted on October 28, 1971 than a strong sense that to reject EEC membership would be to spurn a chance to reverse two or more decades of economic and political decline, and to invite a degree of marginalization in European and global affairs that was all but impossible to swallow for a political generation brought up to believe that Britain was and ought to remain a great power.”

Former Prime Minister Blair makes the same point in his Brexit speech at Bloomberg, adding in his speech that the EU is no longer about integration but about power.  “The case for Europe remains rooted”, “not in understanding the past but the future.” All over the globe, “to maintain strength and influence, to defend their interests adequately, nations of our size will cooperate based on proximity.” [8]

All of the principle protagonists of the UK’s EU membership have supported the EU’s supranational ambitions to create a European great power, capable of taking on the big beasts of the twenty-first century. This was particularly so of Prime Minister Heath; as the architect of the UK’s entry he and Howe got to write the terms of entry, and those terms remain on the books to this day. Officially, the UK subscribes hook, line and sinker to the doctrine of supranationalism and to the goal of creating a USE.

As recorded in PART 1 of this series, Prime Minister Heath was a convinced supra-nationalist, who believed-as Ken Clarke has recorded-that the days of the nation state are over. And as Ken Clarke also recorded, Heath never attempted the Herculean task of beginning to try to convince the British public of his views; Instead, he inserted Section 2.1. in the 1972 European Communities Act. Section 2.1. sanctioned the ECJ’s doctrine whereby EEC/EU law takes precedence over national law. Heath did so, too, on a semi-truth: EU membership, he asserted,  did not entail “an erosion of essential national sovereignty”[9]– and he was correct, in the sense that 1972 ECA Section 2.1. had parliament underwrite its own muting.

But that was not the sense in which the British public understood his words. It was true that the British parliament’s sovereign powers sanctioned EU supremacy, but the result was to distort the fundamental settlement of 1689 that underpinned the country’s constitution. Indeed, Prime Minister May’s so-called negotiation was predicated on Section 2.1, and treated the UK in the  Withdrawal Agreement (WA) as a province within an de facto USE. It did so under UK law.

The document bound the UK indefinitely to vassal status without a say. (See my blog: This is a crucial point that the media have missed: EU law prevails in the UK by parliamentary authority. May was just implementing policy as laid down by her predecessor, Heath.

As the great Anglo-Irish statesman, Edmund Burke reminds us, you govern by political consent.[10] The lack of consent in the UK to official strategy became visible at the time of the Maastricht Treaty in 1992. The UK subsequently  stood aside from monetary union, and from the Schengen accords on free movement of people. But its government signed on to the Lisbon Treaty which greatly extended the range of EU powers. There were specific reasons for the rising clamour in favour of a referendum on membership from the early 2000s on-immigration, the 2008 crash, the London-provinces gap- but a fundamental reason was the ever expanding reach of EU law, underpinned by the authority of a self-muted parliament. The fundamental inherited right of British voters for six centuries has been to be able to sanction their legislators at election time. Membership in the EU neutered this right as a growing flood of legislation flowed from “Brussels”-a Brussels in which the knights of Whitehall were enthusiastic participants.

The EU’s fundamental deficit.

The lack of consent is the  key ingredient of EU governance that is missing not just in the United Kingdom, but has also been absent in other EU member states, notably in France, the fons et origo of the supra-national European project.[11]UK public opinion was recorded after the vote of June 23 as just as skeptical about the direction that the EU had taken as German, Italian or Spanish opinion. French public opinion was notably more skeptical, and as President Macron admitted on the BBC, if France held a referendum on EU membership, the Leave camp would win.

The British position for a sustainable regime for Europe has been advanced by at least two Prime Ministers in recent years, and it contrasts strongly to the UK’s official embrace of supra-nationalism. In her Bruges speech of September 1988, Thatcher outlined a Europe based on “willing and active cooperation between independent sovereign states”, a more united Europe “which preserves the different traditions, parliamentary powers and sense of national pride in one’s own country; for these have been the source of Europe’s vitality through the centuries.”[12]  A quarter of a century later, Cameron, in his Bloomberg speech of January 2013,[13]  argued for an EU “of free member states …(whose)… national parliaments…are…and will remain, the true source of real democratic legitimacy and accountability in the European Union”.

In the Brussels, Paris and Berlin of January 2013, such a Europe was not on offer. Following the 2010 Euro crisis, a consensus emerged that the only  option was for deeper integration. There could be no going backwards to national currencies. That meant securing the future of the Euro; imposing fiscal virtue on all through the EU’s Fiscal Compact; moving to an EU federation;[14] and a programme that envisaged deeper financial, fiscal, and political union in the Euro area by 2017, and full union by 2025.[15]In October 2015, President Hollande and Chancellor Merkel both addressed the European Parliament in a show of solidarity for “more Europe”.[16] “If (you) don’t want a stronger Europe,” Hollande said in reference to the UK, “the only possible path is simply to leave Europe.” In other words, Merkel and Hollande realized only too well that they were squeezing the UK, already on the edges of the EU, further outwards.

The two visions: a European alliance of sovereigns or a USE.

These two visions of Europe–the one a deeply rooted British version of  de Gaulle’s l’Europe des patries, -which in their time the UK had contested–and the other a USE,-in which the UK since 1992, though a major contributor-was not at ease–  have been present at least since the Hague conference of 1948.  What both share is to ensure peace and prosperity among Europeans. Where their disagreements have become strained is over the means to do so. Which format is the more likely to deliver the ambition?

To answer that, let us define Europe as a dynamic whole, marked by four distinct, but related, features.

  1. Europe has a shared cultural inheritance from Greece and Rome, the now distant roots of a sense of Europe as Christendom,[17]the rediscovery of the ancient world in the Renaissance, and the shattering of European unity under Pope and Emperor with the first Brexit of Henry VIII in 1528. As Ralph Dahrendorff wrote, when Europeans meet outside of Europe, they know instinctively they are from the same civilization. [18]
  2. Europe is a mosaic of interdependent peoples and states adhering for the first time in centuries to common precepts of legitimacy (constitutional government, rule of law, freedom of expression), but in practice highly differentiated by language, religious sensitivities, historical myths, as well as tax systems, economic activities and national structures.
  3. Diplomacy between the sovereign states is Europe’s politics. The substance of that diplomacy may be about trade and welfare, but because EU states are recognised sovereigns on the global scene, international diplomacy between its member states and their diverse external partners remains an integral part of intra-European politics.
  4. Fourth, there are at least two components to this diplomatic system. The first was put in place by the governments of Prime Minister Attlee (1945-1951), supporting the vision of the United States, and was predicated on the creation of multilateral institutions, such as NATO, the BIS, the OEEC.It was entirely consistent with the British constitutional tradition.

The second was advanced in 1950 by the French government for a coal and steel community (ECSC), also supporting the vision of the United States, and focused on creating binding supra-national organisations. The ECSC is the ancestor to the defunct EDC, the Euratom, and the Rome Treaty, with its subsequent development through the Maastricht Treaty of 1992, and the Lisbon Treaty of 2009.

The only sustainable European regime is the first. It states that nationalism of course can be a source of war, but is far from being the only source. National states are also the source of legitimacy, and overwhelmingly so. As recorded in the Commission’s own publication, Eurobarometer, 2% of EU citizens view themselves as “Europeans” only, with a scant 6% regarding their European identity as more important than their national identity. That leaves around 510 million Europeans who give their prior loyalty to their region and their nationality. [19] It is hardly surprising that the supranational model-the model of “ever closer union”- is in crisis (not the model based on multilateral organisations of sovereign states).

There are a number of foundational flaws in Jean Monnet’s design, which has been shared so ardently by his UK supporters. First, as more and more legislative powers accrue to EU institutions, member state powers have been hollowed out, without the EU gaining in legitimacy, while voters’ rights to sanction legislators have been seriously impaired.[20] Second, the collectivity of the EU grasps for an ever wider spectrum of competences, despite promises to ensure “subsidiarity” (bringing decisions close to citizens) and despite inadequate means to implement an ever wider pallet of policies.[21]

As the late Peter Mair has pointed out, the EU does not do opposition. Member states do, though. Their constitutional democracies institutionalize public debate, often involving fierce differences in opinion, expressed in parliaments, in the media, through the regular drumbeat of electoral battlegrounds where opponents gather their armies to capture office, if not power, in the hope that they can implement their particular programmes and sanction them in the name of the national interest.

It is this gap between the turbulent democratic politics of member states, and the supranational/federal ambition to create a USE in an apolitical space, that has opened wide in the years following the financial crash of 2008, followed by the Greek drama of 2010, the European depression, mass immigration and the vote for Brexit on June 23 2016.

Two forces are at work here:

  • the dynamic of globalization, taking protean shape from multinationals, to global terror and social media, exerts constant but differentiating impact on European societies;
  • at the same time, there are the ever more urgent demands from within member states that   their citizens should have a greater say in shaping public policies.

The UK is no exception to the workings of such pressures. However, what was specific to the vote of June 23 was  the British public’s rediscovery of its own constitution. The High Court and Supreme Court judgements (November 2016; January 2017) confirmed that only an Act of Parliament, not decisions by the executive, could overturn the Act that took Britain into the EEC. As Lord Neuberger stated, “To proceed otherwise would be a breach of settled constitutional principles stretching back many centuries.”[22]

The forty-three years of British membership in the EU incubated a constitutional crisis. Entry according to the terms of  1972 European Communities Act helped to further centralise power in Whitehall, and to bypass parliament.  But this was at odds with fundamental constitutional principles, and in turn undermined support both for the United Kingdom and for the EU. As Prime Minister May points out in her 12-point speech on Brexit,[23]

“… Parliamentary Sovereignty is the basis of our unwritten constitutional settlement. …. The public expect to be able to hold their governments to account very directly, and as a result supra-national institutions as strong as those created by the European Union sit very uneasily in relation to our political history and way of life.”

For Britain’s European partners, the vote of June 23 stands as a warning that the European project can only flourish if national democracy is placed at its heart. At present, the EU’s direction of travel is progress towards a federal endgame. In the UK, as in other member states, there is minimal support for this programme.

There is one final point to make: in their desperation, Europe’s supranationalists- at the forefront of whom are the UK’s very own indigenous enthusiasts–argue regularly that unless a USE is formed, Europe will be dwarfed by the mastodonts of the twenty-first century. This opens a new discussion  on global politics, far beyond the reach of this paper: the simple point to make is that if the European vessel, or better the European flotilla, is to withstand the tempest, the ships have to be solidly built. They have to enjoy the deep consent of their peoples.

That is why the option of  a European alliance of constitutional sovereign states, remains on the table. Such an alliance is inherent to the complex realities of Europe in a way that a federal endgame, or the present muddle-in-the-middle,   is not.

What flows from the above analysis is a suggestion to ditch the EU as it is, preserve some of its parts, and substitute it for a European alliance of constitutional states. That would involve a downsizing of the present EU’s ambitions, keeping the internal market, sharply de-limiting the powers of the ECJ including severe restrictions on judicial activism, modifications to the currency regime, and an alliance that locates its authority in the parliaments of the member states. The states also would have an obligation to co-operate. But as sovereigns they must have the power to say no. If they do not, they are sovereign in name only. Such a  Europe of co-operating sovereigns is the only Europe in which the United Kingdom can feel at ease; and I would argue, it is the only viable regime for Europe as a whole.

[1]“Who do EU think you are kidding Mr Cameron? The Sun, February 3, 2016.

[2]Benjamin Grob-Fitzgibbon, Continentazl Drift: Britain and Europe from the End of Empire to the Rise of Euroscepticisms,Cambridge University Press, pp.468-469.

[3]  Michael Ashcroft, Kevin Culwick, Well, You Did Ask: Why the UK voted to leave the EU. Biteback, 2016. Pp. 110-111.

[4]Simon Tilford, Brexit Britain: the poor man of Western Europe? Centre for European Reform, 2016.

[5]Lord Ashcroft, How the United Kingdom voted on Thursday, Friday 24 June, 2016.

[6]N. Piers Ludlow “Safeguarding British identity or betraying it?: the role of British ‘tradition’ in the parliamentary great debate on EC membership, October 1971”. October 1971. Journal of Common Market Studies, 53 (1). pp. 18-34. ISSN 0021-9886

[7]Miriam Camps, Britain and the European Community: 1955-1963, Princetion, Pricneton University Press, 1965(reprint). p.359.

[8] “Tony Blair’s Brexit speech, full transcript”, The Spectator, February 17, 2017.

[9] John Campbell, Edward Heath : A Biography, London, Pimlico, Random House, 1994.p. 360

[10]Connor Cruise O’Brien,  The Great Melody, Minerva, London, 1992 ; more recently, Jesse Norman, Edmund Burke : Philosopher, Politician, Prophet, William Collins, London, 2013 .

[11]Bruce Stokes, Euroskepticism beyond Brexit: Significant opposition in key European countries to an ever closer EU , Pew Research Center, June 7, 2016.

[12]The speech is available on: thesis about Europe’s dynamism as rooted in its diversity is is developed by  Eric Jones, The European Miracle: Environments, Economics and Geopolitics in the History of Europe and Asia, Cambridge University Press, 2003. 3rd Edition.


[14]José Manuel Durao Barroso, President of the European Commission, State of the Union Address, European Commission Press Release Database, September 12, 2012



[17]Christopher Dawson, The Making of Europe: An Introduction to the History of European Unity, originally published in 1932, republished by the Catholic University of America Press, 2001. Tom Holland, Millenium: The end of the world and the forging of Christendom, Little Brown, 2008

[18]On Power : International Power : A European Perspective, Foreign Affairs,  October 1977.

[19]European Commission, Standard Barometer, Spring 2015. Tables of Results. Public Opinion in the EU. TNS opinion and social. European citizenship. p. T115.

[20]Peter Mair ,Ruling the Void: The Hollowing of Western Democracy, London, Verso, 2013,

[21]See Giandomenico Majone, The Deeper Euro-Crisis or : The Collapse of the EU Culture of Total Optimism, EUI Working Papers, LAW 2015/10 Department of Law.




About Jonathan Story, Professor Emeritus, INSEAD

Jonathan Story is Emeritus Professor of International Political Economy at INSEAD. Prior to joining INSEAD in 1974, he worked in Brussels and Washington, where he obtained his PhD from Johns Hopkins School of Advanced International Studies. He has held the Marusi Chair of Global Business at Rensselaer Polytechnic Institute, and is currently Distinguished Visiting Professor at the Graduate Schoold of Business, Fordham University, New York. He is preparing a monograph on China’s impact on the world political economy, and another on a proposal for a contextual approach to business studies. He has a chapter forthcoming on the Euro crisis. His latest book is China UnCovered: What you need to know to do business in China, (FT/ Pearson’s, 2010) ( His previous books include “China: The Race to Market” (FT/Pearsons, 2003), The Frontiers of Fortune, (Pitman’s, 1999); and The Political Economy of Financial Integration in Europe : The Battle of the Systems,(MIT Press, 1998) on monetary union and financial markets in the EU, and co-authored with Ingo Walter of NYU. His books have been translated into French, Italian, German, Spanish, Chinese, Korean and Arabic. He is also a co-author in the Oxford Handbook on Business and Government(2010), and has contributed numerous chapters in books and articles in professional journals. He is a regular contributor to newspapers, and has been four times winner of the European Case Clearing House “Best Case of the Year” award. His latest cases detail hotel investments in Egypt and Argentina, as well as a women’s garment manufacturer in Sri Lanka and a Chinese auto parts producer. He teaches courses on international business and the global political economy. At the INSEAD campus, in Fontainebleau and Singapore, he has taught European and world politics, markets, and business in the MBA, and PhD programs. He has taught on INSEAD’s flagship Advanced Management Programme for the last three decades, as well as on other Executive Development and Company Specific courses. Jonathan Story works with governments, international organisations and multinational corporations. He is married with four children, and, now, thirteen grandchildren. Besides English, he is fluent in French, German, Spanish, Italian, reads Portuguese and is learning Russian. He has a bass voice, and gives concerts, including Afro-American spirituals, Russian folk, classical opera and oratorio.
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4 Responses to British ideas of Europe: PART 4. The UK’s view of a sustainable regime for Europe.

  1. philipparees says:

    Marvellous analysis. Hope you send a copy to TM, or better still present yourself for a senior role. Quite what I can’t envisage but I am sure you can! Every MP (and MEP) should get a copy and be compelled to sit in a quiet room to read it.

    Liked by 1 person

  2. nomadron says:

    Your recent series of reviews of the latest Gillingham book brought me to your site. It is indeed a rare cornucopia – your insights sharpened, I suspect, by your residence in another country. Can’t resist the temptation, as a nomad who is also a fan of diagrams and matrices, to point you to my “Balkan and Carpathian Musings” –
    Ronald G Young


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