With the UK expected to trigger Article 50 by March, how successful is the country likely to be in securing a favourable exit deal from the EU? Bob Hancké writes that there are two major problems for the UK in its negotiation: that the rules of the game, as established by Article 50, are skewed toward the interests of the EU, and that the UK’s approach of drawing ‘red lines’ is unlikely to be successful given the dynamics of the negotiation process.
Judging by the Brexit debate in Britain, the UK will decide what deal it wants with the EU, what it negotiates and what it receives. Not a single day seems to pass without newspapers reporting on yet another way that the UK will redefine its relationship with the EU during and after Brexit: access to the single market, a bespoke deal, taking back control of the borders, passporting rights for financial services, just to name a few that are doing the rounds. It’s as if the country is saying ‘we decided to leave and we will also decide how we will do it’. End of conversation, as Tony Soprano used to say.
There are two big problems with this approach to Brexit. The first is simply that the procedure of Brexit, as captured in the famous Article 50, massively skews the process against the departing member state. Even if the EU is trying to be nice – as it should and as it more or less does – it calls the shots in the negotiations.
The second is related to the dynamic of what political scientists call a two-level game, made famous by Robert Putnam many years ago. It refers to a setting in which international negotiations are embedded in domestic arrangements and vice versa. An EU member state can always claim that it would never be able to persuade its constituencies (citizens, MPs, or relevant interest groups) of the benefits of the prospective deal; for it to be accepted at home, it would need to be closer to that member state’s preferred outcomes. The UK actually excelled in that game with its red line policy; for some it explains why the EU is much more of a neo-liberal system than we would expect given the socio-political proclivities of most of the member states of the EU.
In the run-up to negotiations with the EU, the UK is busy drawing red lines, much in the same way that it did when still a ‘standard’ member of the EU. That way of handling negotiations worked very well because of the particular mode of decision-making in the EU, which rewards recalcitrant members (technically called the joint-decision trap: the EU’s decision-making system requires that more or less all member states have to agree to significant changes in modes of operation). As a result, a brilliantly ironic dynamic sets in, in which the most recalcitrant member ends up with more of what it wants out of the EU than the more enthusiastic members (yes, it does make you wonder why the UK wants to leave the EU if this is the case). Since negotiations usually end up where two can find common ground, it pays the recalcitrant member state to remain stubborn, thus reducing the place where everyone can agree to something that almost perfectly resembles its own agenda. It needs to keep its win-set of acceptable options small, in the knowledge that the others would rather negotiate a relatively weak deal than no deal.
Armed with that knowledge (and with, perhaps, a misplaced arrogance about going it alone in the turbulent world we live in), the UK draws up its plan for Brexit and seems to assume that the EU will take that as the parting shot. The EU may do that. Stranger things have happened in the past twelve months. But the EU is more likely to look at this as a psychodrama in which it doesn’t really want to participate (that seems to be the prevailing mood elsewhere in Europe since David Cameron’s fated call for a referendum).
Here’s the idea: two-level game tactics, in which you reduce your win-set with a view to maximising the chances of your preferred option carrying the day, work if everyone prefers staying together over not finding a solution. This is known as a battle of the sexes game: John wants to go to the football game while Mary wants to go to the theatre, but both want to do something together rather than go alone. A battle of the sexes game is about the unequal distribution of outcomes when both want to cooperate. So, as long as the UK is in the EU, being a slightly recalcitrant member works in its favour because the rest of the EU wants a deal more than no deal.
While it works well as long as the UK wants to remain an EU member, the two-level game tactics backfire when you are negotiating leaving the EU. Drawing red lines when you don’t want to cooperate anymore is massively counterproductive, even if you negotiate among equals but certainly if the other party controls the process. Since there is de facto no second level anymore – the UK has had its Brexit vote and, as Prime Minister Theresa May reminds us almost daily, Brexit means Brexit – the UK no longer is able to use that as a way of forcing other EU member states to inch closer to its preferred outcome. It is, indeed, much simpler to negotiate opt-outs during forty years of membership than opt-ins when leaving the EU.
Note: This article was first published on EUROPP – European Politics and Policy.
Bob Hancké is Associate Professor in European Political Economy at the LSE. His research interests include the political economy of advanced capitalist societies and transition economies as well as macro-economic policy and labour relations. His books include Unions, Central Banks, and EMU: Labour Market Institutions and Monetary Integration in Europe (Oxford University Press 2013), Intelligent Research Design (Oxford University Press 2009) and Debating Varieties of Capitalism (Oxford University Press 2009).
What does it say about the EU that it regards free trade as a ‘concession’ ?
for 6 months, it’s the first lucid article about brexit I have ever read in the british press. Brits seem so self-centered they deny the obvious, and keep fantasysing about “soft” brexit, “transitionnal decade” and such dreams. Public opinions on the continent, that elected leaders have to care with, want a ruthless brexit, and if possible dismembering of the City to share the reliefs. And, on the opposite of what brexiters believe, the “populists” are the more willing for it.
As it was succinctly put “you can’t expect more concessions after you’ve decided to leave than when you’re threatening to leave”.
Article 50 should not be triggered we should just revoke the european communities act and we can then set our own agenda, we want out of the eu because its rules and over regulation are not good for the UK, we have never once won any argument against the lowest common denominator one size fits all fits no one legislation that spews endlessly out of brussels. We need to stop the xenophobic freedom of movement and just control the migration so that we can allow those who would be of value to the nation form the entire world to come here rather than just the unemployed from 27 eu nations.
correction: They will have to accept some freedom of movement anyway, or stop to grow their economy,
If the Uk want to go, then they are free to do so. The problem starts when they also want to be in the common market. Then they must abide by the rules, which include some of their red lines. So most countries will just let them go. They will have to accept some freedom of movement anyway, to stop to grow their economy,
Maybe. Though it might explain their actions only too well if the Brexit camp actually want to destroy the UK economy and if possible drag the EU down with it, perhaps to remake the wreckage more to their own liking. Their cheerleaders have been thoroughly trained to deny this and to blame everyone else until it’s far too late, of course.
A worrying thought Paul.
It’s hard to see reduced co-operation with your neighbours as a winning strategy when they are the most enlightened group on the planet. Ditching them and cozying up to less well intentioned countries is not going to help raise standards much is it ?
Is it just the deal makers and money men who benefit or is there a political dimension in this ?
If so who is it prepared to risk their countries future in their pursuit of power.
Having worked outside of Europe I know what a protected corner of the world it is – and would want any politician – or media mogul – who risks UK’s position in that corner held to account.