Britain and the EU: Should they stay or should they go?

Britain’s heart has never really been in its marriage to the European Union. Public buildings in small towns don’t fly the European Union flag alongside the Union Jack. Prime Minister David Cameron doesn’t often flank himself with the banner at press conferences. And of those Britons who could rouse themselves to vote in the last European Parliament election—and most didn’t—more than 20 per cent chose parties that want Britain out of the union.

This isn’t to say Britons despise the Continent. Tens of thousands work and study there. Others have vacation homes in France and Spain, or go often enough not to bother converting their euros back to pounds when they get home. They know they’ll be back. But in no other country in the union does the expression “going to Europe” mean quite the same thing. Britons visit Europe; Germans are already there.

So when it comes to the EU, even the most enthusiastically Europhilic Britons must make arguments for its merits soberly and pragmatically. Passionate appeals to European solidarity don’t wash. But with large chunks of the eurozone—made up of those countries sharing a common currency—in financial disarray, the merits of continued membership are not so obvious. In the U.K., public opinion is “hostile” to the union, says Charles Grant, director of the Centre for European Reform, a pro-EU think tank in London. Its leaders, he says, “appear to be incompetent people who aren’t capable of solving its problems.”

Contempt for the EU has long featured in parts of the British media, but from Britain’s governing parties, the sentiment is generally restrained. This is changing. Last month, nearly 100 Conservative MPs signed a letter asking Cameron to commit “to holding a referendum during the next Parliament on the nature of our relationship with the European Union.”

It’s a powerful political play that Cameron, who leads a relatively weak minority government, cannot easily dodge. He may have to commit to a referendum eventually, and then what was once the fantasy of pub grumps and tabloid headline writers could come to pass.

“It pains me to say this as somebody who’s spent most of my life on the cause of British integration into Europe. But the chances of Britain leaving before 2020 are at least 50-50,” says Grant. “I will fight to keep us in, but I think it’s a losing battle.”

There was a referendum on Britain’s continued membership in the European Economic Community—a precursor to the European Union—in 1975. And during the 1983 election, Labour promised to withdraw Britain from the EEC. The country, battered by the oil crisis and labour unrest, was in no mood to strike out on its own in 1975. And Labour’s crushing defeat in ’83 was hardly a victory for Europe. Indeed, the party platform was such a mess that one Labour MP described it as “the longest suicide note in history.”

“British public opinion has a resting state where they like to be anti-European,” says Patrick Dunleavy, a professor of political science at the London School of Economics. “The pattern has been that you’re anti-European: you grumble, you blame them, then comes the crunch and you don’t go with it.” Even Britons who don’t like the EU concede it might be good for them.

But a lot has changed in the last three decades, and especially the last three years. Europe’s financial crisis is far from over and member states may again be asked to bail out failing economies in an effort to save the eurozone. Britain, which is not part of the eurozone, is not interested. It is also doubtful the structure of the EU will remain the same. Many analysts and policy makers believe closer financial coordination is necessary to avoid future economic implosions.

That means the eurozone is set for more integration, possibly a banking and fiscal union, at “exactly the same point that the U.K. public is growing increasingly skeptical of EU membership,” says Mats Perrson, director of Open Europe, a think tank with offices in London and Brussels. “That is potential dynamite if not dealt with.”

Perrson believes Britain should have a “looser” relationship with the EU, one that preserves the single market and the free trade Britain enjoys with other member states but relaxes some of the oversight and regulation from Brussels. “Absent new membership terms, absent a new deal between the U.K. and the rest of Europe, I think Britain is on its way out,” says Perrson.

The problem is the rest of Europe. To other member states, “this is simply an attempt at a free ride,” says Tim Bale, a professor of politics at Sussex University. Every nation would like to have free access to European markets without conforming to EU rules, he says. “But it doesn’t work like that. They’re probably deluding themselves if they think they can get anything other than symbolic concessions on the part of the other member states.”

The MPs pressuring Cameron to hold a referendum know this, says Dunleavy: “They don’t want to renegotiate. They want to leave the European Union.” Talk of new terms is nothing more than a decoy to be rejected by other member states so Britons are left with no choice but to exit the union.

If David Cameron believes the same thing, his response has been telling. In a recent newspaper column, he defended Britain’s membership in the EU but said he’s not opposed to a referendum on new terms. And he argued such terms are necessary: “Put simply, for those of us outside the eurozone, far from there being too little Europe, there is too much of it. Too much cost; too much bureaucracy; too much meddling in issues that belong to nation states or civic society or individuals. Whole swaths of legislation covering social issues, working time and home affairs should, in my view, be scrapped.”

Most Britons probably agree. Stories—often exaggerated—about EU bureaucrats trying to control everything from the shape of the vegetables Britons are allowed to eat to how loudly they can play their bagpipes are a mainstay of the British press. But Cameron will be painting himself into a corner should a majority of British voters confirm in a referendum that they want a more relaxed relationship with the EU, only to have the rest of Europe tell them they can’t have it.

And yet there isn’t an easy way for Cameron to avoid this dilemma. Rejecting a referendum outright is undemocratic and would cost him politically. In defending the status quo he risks further rebellion from within his own party, and ceding ground to the anti-European U.K. Independence Party and the neo-fascist British National Party, which tend to hive off votes from the Conservative right flank. And besides, Cameron has never been a strong Europhile. When he says he thinks Britain’s relationship with the EU should change, he’s probably telling the truth.

Ultimately, though, the choice facing Britons may come down to taking what they have or leaving. Quitting the EU would be a risk for Britain, according to Patrick Dunleavy. The union enhances Britain’s political and economic reach, he says, and the U.K. will become more influential within it in 2014, following changes to voting rules that benefit countries with larger populations.

But with a sizable chunk of the Conservative Party hostile to Europe, and with an economic recession that leaves people wondering if ties to the floundering eurozone might be dragging Britain down, a unique set of circumstances could coalesce to push Britain out—“a whole set of things that could chain together into a catastrophic result quite easily, if the ruling elites are not careful,” says Dunleavy. “And the sad thing is, they’re not careful people. They make careless, rash decisions, and they do it for very short-term reasons. And that’s how you would get onto this path.”