Saturday, July 2, 2016

Brexit - Lesson 2 - Bigger, Not Better

There was a time when Britain wanted to join the European Union.  They did so in 1973, when it was called the European Community.  And they wanted to stay - in 1975 a referendum was held in Britain, and 66% voted to stay.  This tells me that the objectives of the European Community and Britain were well aligned.  The British people thought that their interests were best served by staying in the Community.

So what changed between 1975 and 2016?  Forty years is a long time.  Here are the highlights of the history of the European Union:
  • By 1975 there were nine countries in the European Union:  Belgium, France, Germany, Italy, Luxembourg, the Netherlands, the United Kingdom, Denmark, and Ireland.
  • 1983 - 1985 - Greece, Spain, and Portugal joined.
  • 1986 - The Single European Act was signed, creating “an area without frontiers in which the free movement of goods and persons, services and capital is ensured.”
  • 1990 - East and West Germany were unified.
  • 1993 - The Maastricht Treaty created the Euro Currency.  Britain negotiated an opt out clause.
  • 1995 - Austria, Finland and Sweden joined.
  • 2002 - Euro banknotes and coins were introduced.
  • 2004 - 10 new Eastern European countries joined the European Union.
  • 2007 - Bulgaria and Rumania joined.
  • 2008 - A financial crisis hit the global economy.
  • 2013 Croatia became the 28th member country.
By the time of the recent Referendum, the European Union was a very different community from the one that the United Kingdom had ratified in 1975.  Several countries in the Union have had severe banking and fiscal crises.  Youth unemployment in these countries is at an all time high.  Poorer, Eastern European countries have joined.  Migration from these countries to the more affluent countries is occurring.

Had Britain not already have been a member, would they have joined the EU in the last few years?  I don't think anyone would have even tried to argue that it would be in their interest to do so.  So why should we be surprised if they leave?

The lesson here is that bigger is not always better.  As new members join a community, it becomes increasingly difficult to keep everyone's goals in alignment so that continued alliance makes sense for everyone.  Community leaders must work extremely hard to continually monitor and change, if necessary, the constitutions of organizations as membership changes through growth.

1 comment:

  1. Yes, bigger isn't always better for sure. I think you're right that Britain wouldn't have joined today. With all the hand wringing, it just all might work out better for everyone, including those countries that remain.