Demonstrators hold placards as they march during the anti-Brexit People’s Vote march in London, U.K. (Photographer: Chris Ratcliffe/Bloomberg)

Brexit Is Happening. The EU Has Bigger Things to Worry About

(Bloomberg Businessweek) -- The European political fabric changes for good at 11 p.m. London time on March 29, 2019, when the U.K. is scheduled to leave the European Union after 46 years of membership. The date is a neat fit: It comes just two months before every adult citizen of the bloc’s remaining 27 countries gets to vote for members of the European Parliament, and by Brexit day campaigns will be in full swing.

EU elections have often revealed more about the direction of domestic politics than the sentiments of European voters at large. In many countries, the twice-a-decade votes have evolved into a protest, a reaction to who’s in charge at home rather than a referendum on how the bloc is managed. But 2019 will be different—because in many countries the role of the EU now dominates domestic politics, too, whether because of the bloc’s role in managing the refugee crisis, controlling government spending, or demanding more respect for democracy.

Brexit Is Happening. The EU Has Bigger Things to Worry About

Nationalist groups are on the rise in Germany, have won political victories in Italy and Austria, and are in power in Hungary and Poland. Other nations, from France to Sweden, Spain to Finland, flirt with their own movements that pledge to rip up the established order. “The world is fracturing, new disorders are appearing, and Europe is tipping almost everywhere toward extremes and again is giving way to nationalism,” French President Emmanuel Macron said in an Oct. 16 televised address. “Those who do not see what is going on around us are sleepwalking.” Next year’s vote is shaping up to deliver a verdict on the whole 60-year European experiment.

The EU Parliament’s task is to act as a check on the European Commission, the bloc’s unelected executive arm, whose president and commissioners it must approve. This includes voting on laws the commission proposes. Each member state has a number of seats apportioned by population, from 96 for Germany to six each for Cyprus, Luxembourg, and Malta. Elections will take place from May 23 to 26, and while individual countries have some freedom over how the election is organized, some form of proportional representation is mandatory.

Candidates are generally chosen by and represent national parties; those parties often come together to form pan-EU caucuses. Since direct elections were introduced in 1979, the pillars of the two mainstream pro-EU alliances—the center-right European People’s Party and the center-left Socialists—have together held a majority. The EPP is dominated by German Chancellor Angela Merkel’s Christian Democratic Union. Merkel’s decision not to run for another term as chancellor in 2021 after losses in recent state elections robs the mainstream of its most powerful leader at a crucial moment and highlights the difficulties for the center parties. Many of the CDU’s traditional voters have gone either to the Greens on the left or the Alternative for Germany on the far right.

Brexit Is Happening. The EU Has Bigger Things to Worry About

While EU Parliament elections are notoriously difficult to predict, the successes recorded by populists across the Continent mean many analysts expect them to do well. A survey of opinion polls from across Europe carried out by Italy’s Istituto Cattaneo showed that the two main alliances could register significant losses, with the center-left winning fewer than 20 percent of seats. Nationalists seem set to gain. “It’s likely we will see populists use the EU as a scapegoat for all the misgivings they have about politics domestically, just as we saw in the U.K.’s EU referendum,” says Agata Gostyńska-Jakubowska, a Brussels-based research fellow at the Centre for European Reform, a pro-EU policy group. “The whole election campaign will be about what the European project is about, what European values mean now.”

It’s not difficult to see how we got here. A decade of crises has taken its toll on Europe’s political certainties. First came the debt turmoil, which pitted Greece against Germany and engulfed the whole euro area. As that subsided, the Continent found itself dealing with the biggest influx of refugees since World War II. The 2016 Brexit referendum stirred the pot further: Suddenly the dream of throwing off the shackles of an unwelcome supranational union wasn’t as impossible as most assumed.

Two years later, many nationalist movements have moved away from talking openly about the destruction of the EU. Populist parties including Marine Le Pen’s National Rally in France (recently renamed after decades as the National Front) now talk about everything the EU is doing wrong instead, from eroding national sovereignty and identity to going soft on immigration and being a slave to open markets and big businesses. The Party for Freedom in the Netherlands, which narrowly lost last year’s election, campaigned on the promise of a U.K.-style referendum on membership. The Danish People’s Party, the country’s second-biggest, wants to renegotiate its country’s relationship with the EU, but it stops short of calling for an exit.

“The extreme right is now posing as the main defender of the welfare state, of benefits for working-class people,” says Michael Leigh, a senior fellow at the German Marshall Fund in Brussels and former European Commission director general. “As with Brexit, it stems from a combination of economic and identity issues. Apart from the opportunism of radical populist leaders, this is mainly a failure of social democracy and the center-left.”

Europe’s Establishment isn’t giving up the fight just yet. Macron’s victory in 2017 on a pro-EU ticket, coupled with the reelection of Dutch Prime Minister Mark Rutte—who vanquished the Party for Freedom’s euroskeptic, anti-Islam Geert Wilders—has given mainstream parties some heart. Despite plummeting popularity at home, Macron portrays himself as the leader of Europe’s democratic bulwark. He has called for a “regrouping” of European political bodies, creating an alliance of “progressive” politicians to take the battle to the energized nationalists on the May ballot.

The European response to Brexit has been a source of hope to EU loyalists. The bloc’s economies suffered no major shock based on the Brexit vote, and productivity has increased steadily. From the outset of negotiations on an exit agreement with the U.K., the EU was hip to the British government’s strategy to “divide and rule” by attempting to circumvent the European Commission as negotiator and deal predominantly with national leaders, which could have helped the U.K. buy off some governments. While Conservative Prime Minister Theresa May dealt with party infighting, mainly because of an unnecessary and disastrous 2017 snap election, Europe’s leaders stuck to their positions, preventing the U.K. from cherry-picking the parts of EU membership it wants to retain. Surveys show renewed support across Europe for the EU.

While EU supporters are quick to say the U.K.’s domestic turmoil shows the cost of underestimating the bloc’s underlying value, they generally stop short of predicting this will translate into gains for mainstream parties in the European legislative ballot. A good performance by anti-EU groups in next year’s elections could make it difficult for the Parliament to act as a counterweight to national governments and the European Commission. Just as important, it would send shock waves through mainstream domestic politics across the Continent. Even policymakers who generally oppose her views agreed with France’s Le Pen when she said in September that these elections could “change everything.”

To contact the editor responsible for this story: Jillian Goodman at jgoodman74@bloomberg.net

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