Make no mistake about it, the best outcome for Ireland would be for Britain not only to stay in the EU but also to adopt the euro as its currency. Neither is going to happen, though. That we know for sure now.
It is likely that Britain will exit not only the single market but may even decide to exit the customs union. This, as is well understood, would pose very serious economic and political difficulties for Ireland, a country which had no say whatsoever in the decision.
The least-desirable possible option, even in this worst-case scenario, would be for Ireland to exit the EU. Musings about the desirability of this are surfacing. They have been rejected at the highest level and its important that they continue to be rejected.
One of the lessons of the British experience is that a constant flow of anti-EU rhetoric over many years was never challenged until it was too late. "British jobs for British workers" was after all the slogan at one point of one of the main Remain campaigners, Gordon Brown. David Cameron, the lead person in this campaign, never missed an opportunity to denigrate aspects of the EU, not least the European Parliament.
Pauline conversions
The Pauline conversions of both, and indeed of many in the UK, simply came too late to convince an electorate imbued with anti-EU tirades for so long. Let Ireland not repeat this mistake.
The case for EU membership needs to be made over and over again. Which leads to two other lessons from the British experience. First is that once perceptions take hold, they are very difficult to dislodge. People vote after all on the basis of perceptions and not facts. Second is that every system has flaws, very serious in many cases. But they must be compared to the alternatives.
The alternatives to EU membership were not discussed in any serious way in the UK. Those who tried to highlight the problems involved in leaving the EU tended to concentrate on narrow economic issues.
The bigger and much more important issue of the need to pool decision-making to “regain control” in an increasingly interconnected world was largely ignored.
A country acting alone will never regain control. Control, for example, over the rules for trade in goods and services, the movement of people for both work and leisure, security and defence, the environment and climate change, the activities of multinational companies and the use of the seas/oceans owned by no one.
Ingratiate itself
Is it “taking back control” to see the British political system recently ingratiate itself so much with the new, volatile US administration, whose primary goal is “America first”? Besides, Britain also will have to abide by WTO rules and arbitration procedures if it exits the customs union and still wants to trade. It will also have to abide by any common rules agreed in any other trade negotiations.
Acting together, we need a legal framework and institutions agreed by all to oversee and enforce the “rules of engagement” needed to regain control. Sovereignty is the exercise of facing this reality and thereby agreeing to pool decision-making to ensure peace and prosperity for one’s people. This is what membership of the EU is fundamentally about.
Which brings us back to what Ireland should do following a UK exit from the EU, which will involve an exit also from the customs union. There is little doubt that there would be a serious economic cost and a very serious threat to political stability on this island arising from such an outcome, despite the assurances in prime minister Theresa May’s comments during her visit to Ireland last week .
The economic cost, though, would be even greater if Ireland also exited the EU. We conduct far more trade in goods and services with the rest of the EU, and one of the key rationales for non-EU investment in Ireland is unfettered access to EU markets.
No input
The political consequences could be even greater. An Irish exit from the EU would inevitably mean effective monetary union again with the UK, but once more with no input whatsoever by Irish policymakers into decision-making in such a “union”. Political decisions made in Britain also with regard to trade policy with the rest of the world would hugely impact Ireland but without the need to take any account of Irish concerns.
The only viable course for Ireland then is to commit strongly and unambiguously to the EU, as several prominent politicians have done already, regardless of the British exit outcome. Given this unequivocal commitment, it will be much easier for Ireland to attract strong support for its position vis-à-vis the UK from the other member states of the EU.
With this strong support, allied to addressing urgently how Irish dependence on the British economy can be considerably lessened over time, the consequences of a worst-case British exit from the EU can best be managed.
John O’Hagan is Emeritus Professor of Economics at TCD