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Why Did David Cameron Offer The Brexit Referendum Anyway ?

November 10, 2019 - 21:52 -- Admin

Talking Politics

I have just discovered the excellent Podcast Talking Politics which discusses UK, US and European and International Politics.

You must subscribe to Talking Politics. It is put together by David Runciman of Cambridge University and provides commentary and analysis in the best British academic tradition – informed, fair, objective, funny. It is absolutely brilliant.

I listened to Episode 193 entitled Cameron’s Referendum which explains why ever did David Cameron offer the 2016 Brexit Referendum in the first place.

Here are my notes from the Podcast, supplemented by notes from panellist Helen Thompson’s paper Inevitability and contingency: the political economy of Brexit, The British Journal Of Politics and International Relations, June 2017

My apologies to David Runciman and Helen Thompson for any errors of interperetation of their work in what follows.

Why Did Did Cameron Offer The 2016 Brexit Referendum ?

It was a calculated gamble. Cameron wished to satisfy popular demand for an In/Out Referendum so he held it despite the enormous consequences of losing. Cameron thought he would win the Referendum, the European issue would be settled and he could move on securely to other things. But the Remain campaign was mishandled and he lost.

Background: The British Political Class Always Wished To Avoid An In/Out Referendum

From 2001 to 2004, the European proponents of ‘ever-closer union’ developed a wide-ranging proposal for greater integration of EU Member States into the EU with many more powers located within the EU, the corollary of which was significant devolution of powers of menber states to the EU.

This so-called EU Constitutional Treaty was signed in October in 2004 by 25 EU Member states and then offered to the voting public of member states for popular assent.

The EU Consitutional Treaty was frightening for many ordinary citizens of Europe even in Europhile nations. The Constitutional Treaty was defeated in France in May 2005. being rejected by French voters in a Referendum. Many in the UK were deeply worried by the spectre of a Federated European super-state obliterating UK national sovereignty.

1. In the light of  fears precipitated by the (defeated) EU Consitutional Treaty, Blair during 2005, promised that any future devolution of power to EU would be submitted to a Referendum
2. This was consistent with Margaret Thatcher’s position on devolution of power to EU.
3. The entire UK political class knew that any Referendum on devolution of power to the EU would most likely be defeated.
4. So historically, when the UK political class sought more integration with Europe this was done by means of Parliamentary ratification, thus avoiding Referenda.
5. The political class knew that a lost Referendum on EU membership would precipitate a Constitutional Crisis in the UK,
6. Therefore the political class wished to avoid any Referendum on EU membership.
7. This being the case it is puzzling that David Cameron allowed a Referendum on EU membership.
8. Additionally, a lost Referendum on EU Membership would severely damage the Conservative Party and terminate Cameron’s career as PM.
9. So why did DC allow a Referendum on EU Membership ? Surely the stakes were too high and the consequences of loss catastrophic.

Cameron Wished To Reform The Conditions Of UK Membership Of The EU.

10. David Cameron (DC) wanted UK to remain in the EU.
11. But he wanted to reform the conditions of UK membership in the EU.
12. In particular he wanted to regain some powers that the UK devolved to the EU in the Lisbon Treaty of December 2007.
13. DC believed that the EU would eventually propose another Treaty on EU Membership.
14. He thought he could use those future Treaty negotiations to regain those powers lost in the Lisbon Treaty.
15. DC thought that the Eurozone crisis of late 2009 and onwards would precipitate that new Treaty proposal.

The Referendum Lock 

16. In December 2007 Gordon Brown ratified the Lisbon Treaty without any Referendum or Plebiscite
17. The Lisbon Treaty was a significant treaty deeply affecting UK/EU power balance.
18. It was basically a rebadged and slightly diluted re-presentation of the Constitutional Treaty rejected by  voters in France and other EU member states in 2005.
19. That Gordon Brown would ratify such a notable re-weighting of UK/EU relationship without a Referendum or  Plebiscite created fury amongst a significant percentage of the UK population given the national consensus which had emerged in 2005 that no more transfer of power to Brussels should occur without a Referendum
18. In Jan 2008, DC, then Opposition Leader, pledges a Referendum on the Lisbon Treaty
19. In Nov 2009 DC promises a Referendum lock on future EU Treaties.
20. But he fails to deliver on a Referendum on the Lisbon Treaty, saying that he could not legally do it.
20. In March 2011 DC passes the Referendum lock.

The Eurozone Crisis

21. The Eurozone Crisis does indeed precipitate a proposal for a EU Treaty.
22. So Cameron was right !
23. Angela Merkel insists on modified Financial Rules within the EU since Germany is shouldering the lion’s share of the financial burden in bailing out Greece.
24. In Brussels, December 2011, under German leadership and in the context of the Eurozone crisis, strong outlines of the European Fiscal Compact are presented in terms of a Treaty proposal
25. Cameron vetoes the Treaty proposal.
26. The EU then redraws the Europen Fiscal Compact as a Eurozone-only agreement
27. Cameron believes that EU institutions cannot be used within a Eurozone-only inter-governmental agreement
28. But it turns out that they can.
29. So the European Fiscal Compact can proceed without a Treaty.
30. So Cameron’s strategy for clawing back powers lost in Lisbon by blocking EU Treaty proposals was proven ineffective.

Dilution Of Uk Financial Power Within The EU and Exposure Of British Weakness Within The EU

31. The UK also lost crucial power in Financial Services at this time
32. In July 2011 The European Central Bank (ECB) introduces the “Counterpaty Location Policy”
33. This regulation would force large Clearing Houses for euro-denominated product to be based in the Eurozone.
34. This would cause UK based euro-clearing houses to relocate to Europe and weaken the UK as a Finanical hub.
35. Lisbon Treaty rules removed the effective UK veto on Financial Services proposals within the EU.
36. DC was unable to prevent the ECB Location Policy despite vetoing the EU Treaty proposal in Brussels.
37. Defeat on the Location Policy and on the Financial Compact showed that DC and the UK lacked political power within the EU and could not effect change within the EU as a single actor within it.
38. DC did not overtly fight the EU over the Location Policy.
39. The UK did instigate a legal challenge to the Location Policy, but that action was taken rather quietly with no attempt to whip up criticism or resentment against the EU.
40. It is suggested by Helen Thompson that the reason that DC was quiet in his opposition to the Location Policy was to keep good relations with his government coalition partner, the Liberal Democrats, who are pro-Remain in their EU outlook.
41. Other Financial Reform proposals which weakened London’s position vis-a-cis the EU were strongly contested however.
42. But this pressure did not yield concessions from the EU.

43. The ECB Location Policy was quashed by the European Court in Dec. 2015 but the judgement did not prevent the possibility of the Location Policy returning by other means.
44. In summary, it was clear from December 2011 that the UK lacked leverage against the EU.

Persisting With A Provenly Ineffective Strategy

45. In Jan. 2012 DC starts to seriously consider an In/Out Referendum.
46. Trusted advisors such as George Osborne advise him against it.
47. In Jan. 2013 DC gives his Bloomberg speech saying that an In/Out Referendum will inevitably be presented to the UK populace.
48. In his Bloomberg speech DC says that he will re-negotiate the UK/EU relationship and then present the renegotiated terms to the UK people in a referendum.
49 The Eurozone crisis is still on-going at this time.
50. Consequently DC still believes, despite failing at this very strategy in 2011, that because of the Eurozone crisis, the EU will put forward  another Treaty which he will use veto power against in order to claw back powers previously lost to the EU in Lisbon.
51. During 2014 DC extracts certain exemptions from the EU such as a guarantee that the UK will not be required to bail out Eurozone economies and also gains an opt-out clause on ‘ever-closer union’

The EU Comes To Prefer An EU Without The UK

52. As the Eurozone crisis played out in the period up up 2015 it became clearer to the EU that the UK was dispensible to the EU.
53. Being outside the Eurozone, the UK could not assist the EU in managing the Eurozone crisis.
54. And since the EU knew that the UK had a “Referndum lock” established in law, then the EU had a disincentive to offer new EU treaties to advance the project of ‘ever-closer union’.
55. Taken together this meant that the prospect of a Brexit was acceptable overall to the EU, despite some admitted adverse consequences to the EU.
56. This meant that the EU, and in particular Germany, was able to deal with the UK from a position of strength.
57. For example in autumn 2014, DC backed down on asking for concessions from EU immigration law.
58. In early 2014 DC did warn Merkel that he might be forced to hold an In/Out Referendum unless the EU declined to appoint Jean-Claude Juncker as head of the EU.
59. Merkel simply told DC not to threaten her and DC backed down.
60. So it must have been apparent to DC that the threat of an In/Out Refendum had no weight in EU negotiations and would not force even the simplest concession, let alone major concessions.

Popular Demand For an In/Out Referendum Grows

61. During 2014 and 2015 popular demand for the UK to leave the EU grows
62. During the 2015 General Election campaign DC reiterates his commitment to hold an in/out referendum on UK membership of the EU by the end of 2017, but only after “negotiating a new settlement for Britain in the EU”.
63. In early 2016 DC reports the result of those negotiations.
64. While some of the concessions extracted by DC and the UK were meaningful, the concessions did not dampen sentiment for a Leave position
65. In March 2016, DC delivers his promise for an In/Out referendum.
66. In doing so, DC has delivered exactly on his promise made in his Bloomberg speech of 2013.

Was It A Considered Gamble ?

67. So why hold such as dangerous Referendum where the stakes are so high and it will have no impact on the EU demenour towards the UK ?
68. Helen Thompson conjectures that DC reckoned that he would win such a Referendum should it ever be put.
69. So DC could satisfy popular demand for a Referendum, including demand within his own party, then win the Referendum and move on with the issue settled.

70. But could DC have nevertheless had a referendum on EU negotiating points as an intermediate step before offering  an In/Out Referendum ?
71. DC indeed could have attempted this strategy but it would likely have been seen as resiling from his commitment to an In/Out Referendum – it would most likely have been seen as a weak and pusillanimous strategy.

72. So perhaps a better thing would have been to avoid offering the Referendum at all.
73. But popular demand for a referendum was high.
74. DC most likely sensed he needed to offer the referendum
75. And he was probably thought he would win it.

So finally, why did DC offer an In/Out Referendum ?

76 So finally, why did DC offer an In/Out Referendum ?
77. To satisfy popular demand for the Referendum.
78. He thought he would win it.
79. But the campaign was mishandled and he lost.