Why is Brexit considered so bad for the EU?

Question

From a non-British POV, the news about the UK considering leaving EU is almost unanimous about Brexit being bad for the EU. What are the most important reasons why it would hurt the EU?

The reasons that come to my mind are:

• diminished financial and political clout due to one of the major European countries and a major business hub leaving

• possible worries of the precedent of a country leaving the EU opening a can of worms that eventually leads into dissolution

However I can also see what I believe many "eurocrats" could consider major upsides. It is hardly a secret that a major country opposing closer unification has been a major headache to the architects of the EU, most of whom probably consider ever closer unification a central tenet and goal. After Brexit there would be a slightly smaller union with less dissent and only a single major currency, so it presumably would be more clearly a single economy with only small outliers.

Do grossly underestimate the downsides or overestimate the upsides? I'm merely surprised that media (discounting obviously EU-opposed media) treat the prospect of Brexit as an entirely negative prospect for the EU.

Answer 1

The concept of Brexit is worrying for a number of reasons:

Impact on European Union

Legislative

• EU becomes hard to justify if you set the precedent of a country leaving altogether

• Territorial integrity of current members becomes hard to justify if you allow for an EU system with such a broad degree of acceptance (see Catalonia, Cyprus)

Economic

• The cornerstone achievement of the EU is the single market, incomplete as it may well be. Reversing a country out of this de-facto free trade agreement results in a loss of consumer and producer surplus for trade with the UK

Ideological

• European project is born out of the ashes of World War II, reversing the course was never the intent of the founding fathers

Impact on the UK

• Most of the above, just from a UK perspective

• Loss of investment confidence in a country that removes itself from the single market (City of London is the most worried - bankers don't need access to an 80m people market they need access to 500m people)

The argument made from the Unionist side tends to lean towards stressing the negative downside of the UK leaving. There are many good upsides of the UK being part of the project that have yet to be stressed and enumerated to make a more rounded campaign.

I personally don't think that the EU-crat upside is a widely shared belief. Yes, technically speaking you may remove a barrier to further European integration if you get rid of its most reluctant member. But imagine Lincoln had made the same argument on Southern secession instead of pushing the cultural norm of Unionism further, albeit unfortunately through violence. I see the UK debate separate from deeper Euro zone integration talks and even the concept of uniting the EZ into a sovereign state is removed from membership of individual states in the supranational organization of the EU.

The bottom line is that the EU is unwieldy, inefficient and probably in dire need of reform (in my personal opinion, needs federalization to work).

However, today it stands as layers and layers of treaties setting forth of some of the broadest, constructive and integrative international cooperation the European continent has ever seen. Removing oneself from this progress is to slide into the comforting temptations of nationalist exceptionalism that has no place in a community of nations that twice brought the world to war and has since forged the largest economy in the world through meaningful nation-building.

Answer 2

First and foremost because it sets a precedent. The psychological effect of it becoming something realizable will sip its way into all future political considerations. If it actually happens, the confederacy which it created will be much more fragile and will have to remain cognizant of the possibility of other countries electing to withdraw in a similar manner in the future.

As long as an EU exit hasn't been tried, even if it remains perfectly legal, it remains a legal theory which would only be entertained by some of the more extreme political parties. After it happens even once, it will become a political consideration that even mainstream political parties will entertain or have to contend with.

Answer 3

There are two kinds of countries in the EU: The economically weaker countries which receive subsidies and the richer countries which pay for them. The UK is one of those countries which pay far more into the EU than they get from it (directly! There are of course indirect benefits for everyone from the EU).

Losing one of the net-paying countries would of course be far worse for the EU than losing one of the net-taking counties.

And then there are things like EU-wide standardization of certain industry standards which make international commerce far easier. So far the UK hasn't played along with all of them. For example, electric devices with Europlugs don't work in UK electric outlets and vice versa, which is an obstacle for commerce of electric appliances between the UK and the rest of the EU. But when the UK leaves the EU for good, they will likely cooperate even less, which makes it even harder for other European companies to export their goods into the UK.