U.K. Loses Big Vote On The Future Of Europe — Now What?
The European Union made history Friday by bringing three of Russia's neighbors — Ukraine, Georgia and Moldova — under its economic tent.
The eastward expansion of trade agreements will push European influence deep into a region that Russia would like to dominate. In light of recent Russian aggression in Ukraine, that's a big deal.
But the EU summit in Brussels, Belgium, generated a second major headline later in the day.
Leaders of the European Union's 28 member states voted on the next president of the European Commission, which serves as the EU's executive branch. The president sets the policy agenda, enforces rules and represents Europe abroad — so it's the most powerful position in the EU. Friday's vote ended up 26-2 in favor of Jean-Claude Juncker, a former prime minister of Luxembourg.
On this side of the Atlantic Ocean, that sounds more like zzzzzz than WOW!
But the outcome matters because the losing votes belonged to the United Kingdom and Hungary. And they were deeply, totally, seriously opposed to Juncker — so much so that his victory could trigger an eventual reconfiguring of the EU in ways not favorable to the U.S.
U.K. Prime Minister David Cameron sees Juncker as a political fixer, a crony-type politician with a reputation for drinking too much and defending the EU bureaucracy too vigorously. And the U.K. and Hungary fear that Juncker wants to take away too many powers from sovereign states.
The 26 leaders who voted for Juncker insist that under EU rules, they had to nominate the Luxembourger, who will now go on to get rubber-stamp approval from the European Parliament in mid-July.
After the vote, Cameron called the outcome "a serious mistake" and promised to work for changing the EU rules. He said pushing reforms would involve "a long, tough fight."
It's not clear yet exactly what steps he will take. But the real question is: Will his fellow countrymen be angered enough to give up on "reform" and instead vote to leave the EU?
No country has ever made good on a threat to exit, but back in 1975, the U.K. did hold a referendum on whether to leave the European common market. (It voted to stay.)
Many Brits now want another in-or-out referendum — this time in 2017. If the U.K. actually were to exit the EU, that would be bad news for U.S. businesses. They count on the U.K. to be America's best friend in any trans-Atlantic dealings.
Economists say that not having the U.K. inside the EU would complicate any trade deals and make Europe a less friendly place for U.S. companies.
So Friday's EU summit has brought a mix of results. On the one hand, the union expanded its reach, stretching to include three more countries under trade agreements. On the other hand, it may have angered U.K. voters enough to set a course toward a bitter breakup with the EU.
Bottom line: The EU summit vote is done, but the ultimate outcome may take years to play out.
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