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The Utter Chaos of Brexit

A court ruling this week has thrust Europe's future into deeper uncertainty.

Carl Court/Getty Images

If you thought U.S. politics was fractured, take a look across the pond. Britain’s High Court has thrown the future of Europe into uncertainty, ruling this week that Prime Minister Theresa May must get Parliament’s approval before she can begin the process of taking Britain out of the European Union. The potential consequences of the ruling are all over the map: It could lead to an accelerated Brexit timetable or a new British governing coalition that nullifies it. It could lead to greater harmony inside Europe or a continental banking crisis.

Back in June, voters approved the so-called Brexit by a narrow 52-48 margin. May, who replaced David Cameron as leader shortly after the vote, planned to abide by the results by the end of March, by formally triggering Article 50 of the Lisbon Treaty—the means for member countries to notify the EU of the intention to leave. This would initiate a two-year process of negotiating a withdrawal agreement.

But a group of claimants led by a native Guyanese investment manager and a London hairdresser objected that, before Article 50 can be triggered, Parliament must approve the action. A similar case in Northern Ireland failed, but the High Court in London sided with the challengers on Thursday. Justice Lord Thomas of Cwmgiedd (yes, that’s the proper spelling) ordered that, because Parliament passed the law granting the U.K. entry into the EU in 1972, only that legislative body can unwind it. “The most fundamental rule of the U.K.’s constitution is that Parliament is sovereign and can make and unmake any law it chooses,” Lord Thomas wrote.

Prime Minister May immediately vowed to appeal to the Supreme Court; the hearing will be held in early December. (Ironically, the case might also go to the European Court of Justice, the very international body Brexiteers were seeking to avoid.) If the government wins the appeal, nothing changes. If not, May must get Parliament to back Brexit.

Since she leads the majority Conservative Party in Parliament that may seem like an easy lift. But that majority is thin, and Conservative MPs didn’t uniformly support leaving. In fact, there’s probably a working majority in the House of Commons that wants to remain. Plus, like Congress during a war vote, politicians would much rather carp on the sidelines than have to put themselves on the line with a vote—one that could have serious long-term repercussions for Britain.

MPs will also likely take the opportunity to micromanage the pending negotiations. Labour Party leader Jeremy Corbyn underlined this on Thursday, saying that May’s government must “bring its negotiating terms to Parliament without delay.” The prime minister has offered precious little information about her strategy, but she has generally foregrounded restricting immigration from other EU countries—a so-called “hard Brexit”—over a softer version that ensures British firms the freedom to export goods and services across national borders. Business leaders oppose a hard Brexit, further splitting MP loyalties.

May could call Parliament’s bluff and dare them to vote against the people, and if that succeeds, she could have what she needs to trigger Article 50 before March. But the unelected House of Lords may have no problem thwarting the popular will. More likely, May will have to bargain with Parliament to round up votes, with MPs demanding assurances that she will undertake Brexit the right way. Given that May cannot pre-determine an outcome with the EU, she may not be able to make that balancing act work.

This could stall Article 50 for months, if not years. At some point, you would expect May to call a snap election, effectively a second referendum on EU membership that would give a mandate to whichever side emerges victorious.

Polling today shows stronger theoretical support for Brexit now than when the vote was held, 61 percent by one measure. And May herself has a giant lead over Corbyn in the most recent surveys. But this wouldn’t necessarily be a head-to-head matchup of that sort; the inclusion of Brexit upends the coalitions, particularly with so many Conservative MPs who would rather remain.

Behind the raw numbers lies an undercurrent of betrayal over the Brexit vote. It began when Nigel Farage, head of the U.K. Independence Party and de facto leader of the Brexit campaign, had to walk back the claim that the National Health Service would enjoy a windfall from leaving the EU. The prospect of a hard Brexit has been so anathema to business interests that Thursday’s ruling led to a huge rally in the British pound. U.K. curry houses, actually a four-billion-pound-a-year industry, supported Brexit but more recently expressed disappointment over broken promises to lift immigration restrictions preventing experienced south Asian chefs from entering the country.

The other big variable is the British economy. That dog has not yet barked, actually: Fears that Brexit would sink the country into recession have not panned out. The British services sector is rolling, and the weaker pound has increased foreign demand for exports (the subsequent rebound Thursday is more of an economic headwind). The question is whether that would hold amid a long period of uncertainty. Inflation is starting to become a factor. Businesses could be paralyzed over where and when to invest. More reports about the potential consequences of Brexit would weigh on the public. Bank of England chief Mark Carney said Thursday that the drawn-out process would hang over the economy.

So does Theresa May’s re-election bid and second Brexit referendum come amid prosperity or downturn? Will Conservative MP candidates stay allied with May or go rogue? Will the anti-immigrant UKIP see any softening in May’s hard Brexit stance as treachery? Will they lead enough of a revolt to threaten Conservative hopes of forming a government? Will they cause a serious breakdown in the U.K. political structure? None of this is fully knowable.

Keep in mind the repercussions of this on the rest of Europe, where the banking system is suffering from low interest rates and toxic legacy loans. Brexit represented a possible turnaround, if they could wrest away control from the financial center of London. Delay or denial there keeps them in limbo, with governments unwilling to impose harsh terms necessary to fix the system. The last thing European banks need is another reason for investors to steer clear of them.

Many see Brexit and the rise of Donald Trump as part of the same nationalist, xenophobic forces out to crush cosmopolitanism. I’m not sure it’s so simple. But if there is a lesson from the High Court order, it’s that political systems with multiple veto points can frustrate any ruler. The chaos that can result in the aftermath, however, should not be wished upon any citizenry.