Obama to Britain .... "No, You Can’t."

May 13, 2016

America has a vested interest. Wanting UK to take part in European integration has been US policy since World War II. For Washington, it’s the best guarantor of a stable Europe that is on-side with US policy. But you bear the cost; America gets the benefit.

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  • Brexit would make Washington’s European policy more complex, not yours

  • UK runs a £34 billion surplus in trade in goods & services with US: you don’t need a new trade deal

  • No Australian PM would tolerate a US leader saying: “to the back of the queue.”

     

Obama’s April 23rd intervention in Brexit was dressed up as friendly advice, but for US State Department it was diplomacy as normal. What Obama chose not to say is that from Washington’s perspective, having the UK firmly tied into the EU promotes three key interests — geostrategic, diplomatic and cultural. Brexit is a direct threat to those interests, which is why a US President has ventured to tell you what you should do.

Cheers Limeys: You keep the EU sweet

First, Washington believes that political integration is the surest means of preserving peace in Europe. Rightly or wrongly, this has been US policy since World War II. This logical and successful policy has always had within it one major risk, however: that a unified Europe, once it felt strong enough, would start to systematically oppose US interests. The US doesn’t want geo-political competition.

 

That’s where UK comes in — and stays in. Washington calculated long ago that a UK moored firmly to the EU is the best possible guarantee that a politically unified Europe won’t turn systematically hostile. The policy works. European leaders know they cannot use the EU to directly oppose US without alienating Britain.

 

This simple dynamic is a permanent, geo-strategic asset to Washington. If UK weighs anchor and quits EU, then the giant European bloc could regularly drift into hostile waters. That would be bad news for America’s global leadership, and US will always act to prevent it.

Uncle Sam’s friend on the inside

The second US interest is more tactical. Kissinger once asked: “Who do I call when I want to call Europe?" For the moment, that’s mostly 10 Downing Street. Whenever events or issues arise that require co-operation, the White House can get straight on to a British Prime Minister, find out what Europeans are thinking, gauge what they intend to do, and try to steer a congenial response.

 

And the fact is, your Prime Ministers like being useful to American Presidents. Some, like Tony Blair, carried this to energetic lengths. Others, like Margaret Thatcher, got things in return. But on a day-to-day basis, having London tied diplomatically to Europe is tactically helpful.

 

To be fair, the degree to which UK actually does America’s bidding is obscured by the general similarity of UK-US interests. It will always be hard to say whether UK gets a decent payback for its efforts. But on a day-to-day basis, you help grease the wheels for Washington, and that saves Uncle Sam a lot of diplomatic legwork in European capitals.

You, the people

The third US interest is in promoting the right political culture in Europe. Politically and constitutionally, the US views itself as something special, and has always wanted to see done-over European states rebuild themselves after its own image. American leaders see UK as its reliable, local handyman. During his visit, Obama credited UK with helping to spread democracy and the rule of law in Europe.

 

Hopefully you’re still too modest to take this ego-fluffing seriously. The comment was insulting to the people of Eastern Europe, who knew exactly what they wanted the second the Berlin Wall came down. And UK is simply one of many in the Organisation for Security and Co-operation in Europe that has helped promote democratic reform in the former Soviet sphere.

 

If democracy really was Obama’s concern then your Prime Minister could have cautioned that EU unity and democracy are becoming two separate things, as elected leaders in Greece and Italy have discovered. But perhaps the timing was not conducive. For now, at least, Washington believes that EU is a seaworthy vessel, that it helps export democracy, and having UK ‘in’ adds ballast. So pushing UK to stay in requires limited additional thought.

And in return, you get…what?

But here’s the crux of the Obama intervention. For all the strategic and diplomatic benefits the US gets from UK membership, it’s UK voters and taxpayers that bear the cost. And America knows it. What’s more, the US is perfectly entitled to adopt a cold, realpolitik approach to UK. It’s done so many times in the past when UK and US interests haven't aligned, from the terms of Lend-Lease and Suez Crises, to the Iraq War.

 

You Brits have a curious need to believe that America is always your friend. But the US has got where it is today though being hard headed — with enemies and friends.

 

The real point is, it simply wouldn’t matter how costly the EU became for Britain – in pounds, trade, judicial independence or democracy – the US will always want you in because it costs them nothing, and the rewards to the US are huge. Generally speaking, the Americans will always want to be your friends, but the US State Department doesn’t have to think twice before putting America’s interests first.

 

Consider the effect of Brexit on US. First, the US State Department will have to upscale its diplomatic efforts in EU, because the UK won’t be acting on its behalf. Second, when US wants something, the diplomatic cost will be heavier. The forthcoming TTIP negotiations, for example, will be a tougher bout simply because the UK won’t be on the inside arguing for free-er trade. Last, the bill for keeping the EU permanently on side will have just gotten more costly. And Washington will have to pay it.

The UK will still be a valuable ally, just less open to being used

As far as Brexit impacting your relations with US, however, it means very little. There’ll be fewer calls from the White House, of course. But the only ones that will actually stop are the ones that involved UK being – to whatever polite degree – ‘used’. The US will adapt to an independent UK foreign policy because it has no choice. Like any country, your value will depend on your own economic and military merits. With the City of London, and two 70,060-ton Royal Navy super-carriers about to hit the waves, you can expect to be taken seriously.

 

And give the Americans time. They will get over it, and they will respect you more for having stood up for your own interests. Eventually, they may discover that a confident, successful UK is a better potential ally than a submissive, apathetic UK, whose leaders are forever distracted by European politics.

 

As for Obama’s line that … “Being part of EU makes Britain even greater …” this is mathematical nonsense. The more you merge your foreign policy with your European friends, the more compromises you make in the interests of all. In matters of vital shared interests, like climate change, the UK will still add its diplomatic weight to the Good Cause, without detracting from the total leverage that can be applied.

 

If EU were keen to use its clout in support of British interests, then Obama may have had a point. But it doesn’t. The EU repeatedly fails to back UK interests around the globe.

 

To take but the most recent example. The UK still has legal obligations to Hong Kong as signatory to the Joint Declaration, which established the city’s administrative independence. The upholding of this international treaty is a vital economic and political concern in the region. Earlier this year, as renegade book sellers disappeared into mainland China, in flagrant abuse of Hong Kong’s Basic Law, senior Hong Kong figures, including ex-Chief Executives, appealed for UK support. Did the EU help stiffen your response? No. Was Britain’s response ‘great’? It was hopeless.

Gee thanks, we’ll join a different queue

That leaves only Obama’s threat to send UK to the naughty corner of global trade negotiations if you vote Brexit. Leaving the wisdom of the comment aside for a second, this is dud ammunition. Look at the trade figures and you’ll see that the US is the one country in this world with whom you don’t need an independent trade deal. The US is already your biggest trade partner: your exports to US are growing crisply at 3.3% per year, and you’re running an overall trade surplus (in goods and services) of £34.1 billion per year[1]. That easily makes US your top-performing trade partner today.

 

And here’s the best bit: you already trade on World Trade Organisation (WTO) terms with US, which is exactly where you’ll be post Brexit if you do nothing but join the WTO. So you can spend as long as you like at the back of that Obama queue once you leave the EU, and keep on smiling. Your trade with US is doing well, and you’re making good money. If it’s fresh trade deals you want, the big prizes lie far to the east.

 

Which leaves only the sentiment of Obama’s intervention.

 

If a US President came to Australia and told us, America’s best ally in the region, that we could go  “to the back of the queue” if we didn’t toe the American line, there would be uproar. What’s more, it’s absolutely inconceivable that an Australian Prime Minister would stand by, nodding, while an American President puts his country down. The disgrace isn’t Obama’s; it’s Cameron’s.

 

That Obama tried to tell you what to do simply shows the scale of vested interests at stake. And incidentally, US isn’t the only state or organisation wanting you to make life easier for them. What Obama should have said was: “We want you to stay in, for these reasons … but if you choose to leave, then as your friend, we will do everything we can to help you.”

 

Well, he didn’t, and you have every reason to react. If the first post-Obama polls are correct, and you really are willing to raise two fingers to outside interests, then … good on you. On the global stage, countries are like people. You earn respect by standing up for your own best interests.

 

© Phil Radford

 

References

 

[1] Comprising a £10 billion surplus on goods (HMRC for 2015) and a massive £24.1 billion surplus on trade in services (April 2015 to March 2016 (ONS quarterly releases). Data for export of services to US in Q1 2015 is not contained in the ONS May 2015 publications, hence the three-month discrepancy in data sets. Services surpluses with US are in any case fairly constant: £5.7 billion in Jan-March 2016; £5.8 billion in Oct-Dec 2015; £5.9 billion in Jul-Sep 2015; and £6.7 billion in Apr-Jun 2015.

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