The “Brexit” and Changing Power Dynamics in the European Union
Disagreements with European officials and leaders have prompted many British citizens to push for a break from the European Union. One significant point of contention is that of how European Union finances are distributed among its member nations. Currently, the European Union redistributes money from the richer countries to the poorer ones to fund technology upgrades and infrastructure investments that strengthen the broader European community. Many wealthier countries, including the United Kingdom, view this practice as a waste of taxpayer money, especially as British contributions to the European Union rose from £2.7 billion in 2008 to £11.3 billion in 2013. Many British government officials are unsure that they will ultimately reap any benefits from this policy.
France and Germany disagree with this rationale, though the recent meeting between Hollande and Cameron does not seem to have noticeably advanced France’s cause. Rather, France seems to be negotiating from a position of weakness as it works to finalize a number of defense spending agreements between the two nations. Still, France already appears impatient with the lack of progress the United Kingdom has made in resolving its differences with the European Union. As recently as July, French Economy Minister Emmanuel Macron criticized his British counterpart for failing to divulge what the United Kingdom actually wants to see from the European Union.
Germany has echoed the French sentiment. A senior member of the German parliament, Michael Fuchs, recently pleaded with the United Kingdom to stay in the European Union, citing potentially devastating economic losses if it leaves. Germany is a significant exporter and relies heavily on the free trade of the European Union, where there are no tariffs, quotas, or other restrictions. A report released by Germany’s Federal Statistical Office in September 2015 noted that United Kingdom is the third largest market for German exports and that the United Kingdom is Germany’s sixth largest importing partner. Should the United Kingdom exit the European Union, many Germans hypothesize, Germany would lose a significant trade market and potentially face an economic downturn.
Despite French and German fear over an impending “Brexit,” many argue that the situation may not be as serious as it appears. Though many British leaders, including United Kingdom Independence Party leader Nigel Farage, point to an increasingly positive reception of the “Brexit” by the British public, many privately-owned businesses in the United Kingdom have voiced their preference to remain in the European Union. In fact, 47 percent of small business owners in the United Kingdom believe that staying in the European Union would boost their economic activity and lead to increased standards of living.
Even taking into account the interests of the United Kingdom’s small businesses, a brand of Euro-skepticism has clearly invigorated a frustrated British population. Over the coming months, British leaders will have to take stock of this and adjust their affairs with Germany and France accordingly.