Brexit - Season Two

Labour's coming strife over Europe

"Today, people want different things,” said David Cameron in his first speech to the Conservative Party conference as leader in 2006. “The priorities are different. Safer streets. Schools that teach. A better quality of life. Better treatment for carers. That’s what people are talking about today. But for too long, we were having a different conversation. Instead of talking about the things that most people care about, we talked about what we cared about most. While parents worried about childcare, getting the kids to school, balancing work and family life – we were banging on about Europe”.

Armed with a mandate from party members and authority among his MPs, Cameron was calling time on the Tories’ 15-year battle over the UK’s place in the EU. In opposition and then in government, the Conservatives would meet voters where they thought they were – socially liberal, internationalist, and wedded to state healthcare and education provision but with added Big Society¹ competition. The Tories would never again be the europhiles of the 1960s and 1970s but, to end party infighting and secure office, they would make this loveless marriage work.

Within three years, the first cracks appeared after Cameron dropped a pledge to hold a referendum on the Lisbon Treaty. These widened in 2011 after a quarter of his MPs voted to pass an in/out-referendum bill. And, by 2013, Cameron was so panicked by the splintering of the right that he promised to renegotiate the UK’s terms and then put continued membership to a popular vote. His cunning plan led to his resignation, split the never-satisfied right further so guaranteeing an ultimate Labour landslide victory, and created western Europe’s most enthusiastic European movement.

The e-word

How quickly Cameron lost control of his euro-ghosting strategy should worry Keir Starmer, Britain’s new Labour prime minister. For the past two years, he and his team have tried the same approach towards the European question. In a July 2022 speech that could have been delivered by Cameron in 2006, Starmer said: “[Y]ou cannot move forward or grow the country or deliver change or win back the trust of those who have lost faith in politics if you’re constantly focused on the arguments of the past. We cannot afford to look back over our shoulder because all the time we are doing that we are missing what is ahead of us”.

Soon after the UK left the EU in January 2020 and the wider European Economic Area (EEA) 11 months later, Starmer decided to make a virtue of necessity. On advice from Rachel Reeves, who now serves as his chancellor, he concluded that - inside or outside the EEA - the UK suffered from chronically low growth and productivity. Instead of obsessing about what had been lost, their new government should address this specifically British disease by deploying the Entrepreneurial State to create a Mission Economy – to cite Mariana Mazzucato, the left’s latest more-namedropped-than-read rockstar economist.

Reluctantly, Labour remainers swallowed the new line. They were so desperate to remove the Tories from power that they said nothing when Starmer pledged to stay not just outside the EU but outside the EEA. Economically far more important than the EU itself, the EEA is a 30-nation regulatory union that allows for free movement of goods, services, capital, and people. And with no political trappings. Labour remainers kept their mouths shut to ensure victory in 2024 and because they were reassured by talk from Starmer and foreign secretary David Lammy of an ambitious “resetting” of the UK’s political relationship with Brussels, Berlin, and Paris.

This promise has been kept. Since taking office, the Starmer/Lammy diplomatic focus has been unusually European as they rebuild confidence inside the EU. This will matter in post-2024 Europe. One way or another, the Russo-Ukrainian war will end soon. The EU and NATO will have a huge, damaged, and militarily powerful neighbour to its east demanding immediate security guarantees, early EU and NATO accessions, and €500 billion in reconstruction funding over ten years. But these calculations are geopolitical and strategic. They are not the economic and cultural bread and butter of modern politics. The 48% who voted remain in 2016 and many of the millions who have turned 18 since then want much more than a friendship treaty with Germany. Small businesses urgently want to remove the new regulatory barriers with their closest market while the tribally “remain” demand a return to free movement.

A movement, not a sect

A YouGov poll conducted on 23-24 July found that, if the 2016 referendum were held again today, 53% would vote to remain in the EU and 32% to leave. Among Labour voters, this breaks down to 81/10%. Respondents opted by 48/25% to rejoin the EEA (Labour voters: 68/7%) and this was supported across all age groups including over-65s. Those polled agreed by 62/12% that Brexit had “failed” while 55/34% agreed that the decision to leave had been “wrong”.

This sentiment can be contained for now but not for long. When he told the Financial Times the day before the election that he didn’t expect the UK to rejoin the EU or even the EEA “within his lifetime”, the 61-year-old Starmer was testing his 2022 repositioning to destruction. I know more than one voter under 40 who swapped to the Liberal Democrats or Greens after that market test.

Like the Tories, rebellion won’t be confined to activists. Starmer’s ministerial team is littered with remainers, starting with Lammy (foreign office), Pat McFadden and Ellie Reeves (cabinet office), Wes Streeting (health), Peter Kyle (science and innovation), Liz Kendall (work and pensions), and Darren Jones and Spencer Livermore (Treasury). As long as they believe that a second-term Labour government could return the UK to the EEA, they will keep in line. The same YouGov poll found that Labour had no mandate to return to the EEA so this would have to be part of the manifesto offering at the next election. The battle for the pen will start well before 2028.

Here the historical analogy stretches beyond the Cameron years and back to the battle between Tony Blair and Gordon Brown over adopting the euro. A technical assessment of whether or not the UK should swap pounds for euros swiftly turned into a struggle for power between the two men and their entourages. Brown may speak fluent remain today but, back then, he and his aides dog-whistled euroscepticism that went well beyond the currency. Labour leaders could get away with this before 2016 when British europhiles were nothing but a sect but today they are a movement. If Starmer promises a decade with no hope of return, he is condemning his party to the Tory Brexit wars in reverse.

1. Cameron's "Big Society" combined free-market economics with the Tory One Nation social contract, encouraging collaboration and competition between state, charity, and commercial service providers. Steve Hilton, the liberal guru who devised it for Cameron, left Downing Street to become a Fox News host and Donald Trump supporter, and is now - I kid you not - considering a run for governor of California.