“There’s no majority in Parliament for anything,” says Thomas Wright, head of the Brookings Institution’s Center on the United States and Europe. The most fearsome possibility seems to be “no deal”: The laws and regulations binding the United Kingdom to the E.U. would expire without a replacement. The result, say many commentators, would be a fearsome economic slump.
“Supply chains would stop,” says Jacob Funk Kirkegaard, an expert on Europe at the Peterson Institute for International Economics, a think tank. The cross-border flow of parts and components — which often requires legal certifications of various sorts — would plunge, because the E.U. rules would no longer apply and there would be no replacement.
“The UK auto industry would have to close,” says Kirkegaard. Nor would it be an isolated example, he adds. Supermarkets have already warned that they won’t be able to import many fresh fruits and vegetables from the continent. An economic study by the Bank of England estimated that a “disorderly no deal” could result in as much as a 10 percent drop in the economy (gross domestic product). The pain would be shared with E.U. countries, because the United Kingdom is a large market for their exports.
Assuming widespread economic consequences, Kirkegaard doubts that a “no deal” decision could “last very long.” Both the E.U. and the United Kingdom would be drawn back to the bargaining table. But to what end?
One possibility is a second referendum. Until recently, this seemed a long shot, because both the Labour Party and the Conservative Party opposed it. The voters have spoken through the referendum, Conservative Prime Minister Theresa May has said, and the government was bound to respect their will. But this week, Jeremy Corbyn, the Labour Party leader, reversed himself and said he would accept a new vote.
On paper, this could end the controversy. Public opinion polls in Britain consistently show a 53-47 percent majority for remaining in the E.U. The trouble is that this policy would leave a huge segment of the United Kingdom’s population deeply alienated. It also might result in a permanent split of the Conservative Party, which is the stronghold of those wanting to quit the E.U.
Another possibility is that Parliament would accept the agreement negotiated by May for quitting the E.U. Parliament has already resoundingly rejected her plan. But this week May again rejected a second referendum, calling for a second vote on her plan as well as a vote on a “no deal” exit.
If both these proposals are rejected — as seems possible — May said she would support extending slightly the deadline for leaving the E.U. This would create a pause for the E.U. and United Kingdom to negotiate an acceptable compromise. Or it may be that there is no compromise acceptable to both.
Already, the leaders of France and Spain have said they would oppose an extension of the deadline unless it involved new choices. All this sounds enormously risky and confusing, because it is enormously risky and confusing.
The irony is inescapable. Aside from resenting the E.U.’s bureaucrats, the supporters of Brexit aim to restore some of Britain’s lost glory and power. But the reality is the whole Brexit process has weakened Britain’s economy and promoted political polarization.