John Rhys James May 2016

The sudden and unforeseen strengthening of the pro-Brexit campaign has made a possible UK exit from the EU the most important of political debate in Europe after the migrant crisis. This debate usually revolves around the possible future repercussions of a Brexit on the EU and Britain, but it is instructive to consider to what extent a British exit from the EU could be considered evidence of a reassertion of attitudes deeply rooted in  British political culture.

There are two main areas to consider in this regard:

• Britain´s internal constitutional arrangements prior to joining the EEC in 1973
• The British ruling elite´s approach to foreign policy pre 1973

Britain`s accession to the then European Economic Community took place in 1973, (the fact that the European Union has only existed since it was created by the Maastricht Treaty of 1991 is generally overlooked.) The full significance of this event can however only be understood against the background of the massive change in Britain`s internal and external political situation that took place between 1911 and 1951.

Britain´s Constitutional Foundation

The fundamental principle of British politics since the Civil War 1641 – 1646 has been the repudiation of absolutism and the doctrine of the absolute supremacy of the elected parliament. It is important to remember that absolutist rule is not equivalent to rule by dictator, the absolute monarch was not unrestricted in his sphere of action, nor did he have a political organization willing to abuse human rights at his arbitrary behest. On the contrary the monarch was bound by the religious commandments and social obligations of Christian feudal society.  Absolutism meant rule by decree, it meant that the sovereign could decree what is law without discussing it with a parliament and that parliament had no right to veto or amend legislation.

Parliament won the civil war and when the monarchy was restored following the death of Cromwell it was done on parliament´s terms. Following James the Second´s flight from the throne, the English political establishment offered the Crown to William of Orange and began the long process of depriving the Crown of its privileges, such as its right to name or veto ministers, introduce or veto legislation, or to remove judges, a process which was completed in 1911 with the Parliament Act which deprived the hereditary House of Lords of the right to veto legislation, thus establishing the elected House of Commons as the ultimate political authority in the land, restricted only by the common law rights of Her Majesty´s subjects as understood and upheld by an independent judiciary.

As a result of this constitutional development, Britain developed a quite different attitude to the matter of formulating and implementing law than was the case in continental Europe. This particularly British approach to the Rule of Law was best defined by the Britain´s most influential constitutional scholar A.V. Dicey in 1885. According to Dicey the Rule of Law requires

(i) The absolute supremacy of ‘parliamentary´ law as opposed to arbitrary power and the absence of discretionary authority on the part of government. Parliament must retain the power to amend the legislation as needed and to call the Minister responsible for implementing the legislation to account. The Minister is also to be held personally responsible for the actions of his civil servants.

1. ii) Secondly disputes between government and citizen are settled in the ordinary courts according to the ordinary law rather than in special state-run administrative courts. Dicey thought that special administrative courts would give the government special privileges and make it more difficult to call politicians and bureaucrats to account for their actions.

iii) Dicey was opposed to conferring discretionary decision making powers or the ability to make law on executive bureaucrats. This he believed opened the door to arbitrariness and would make it impossible to ensure that  powers are exercised in good faith, without bias and on the basis of stated criteria, which practice being essential to maintaining the rule of law.

This British approach to the rule of law conflicts directly  with the continental tradition of an “etat legal”, or “Rechtsstaat”, in which executive officials and government departments are expected to issue legally binding decrees creating subordinate legislation. Such decisions can only be challenged in special administrative courts, whose jurisdiction only extends to examining whether the executive action is compatible with the  law conferring subordinate legislative powers upon the administrative department in question. In other words the executive defines itself the criteria by which executive action is to be reviewed judicially. This arrangement has three negative consequences from a common law perspective:

• The practice of issuing “Weisungen” or directives, that is to say the practice by which an elected politician or senior administrator may issue a directive to a lower ranking bureaucrat compelling him to use executive power to benefit or disadvantage particular individuals, even if this requires the bureaucrat to contravene publicly stated criteria to reach such a decision,
• The fact such directives may not be questioned or overturned by the administrative courts. Article 9 of the German law regulating judicial review of administrative action (VwVfG ) expressly states that only external actions taken by the authorities can be examined by the administrative courts. Actions taken within the bureaucracy, including Weisungen, are beyond the remit of the court to examine.
• The fact that the authorities are often exempted by legislation from an obligation to declare what criteria were used to come to particular decisions.

This manner of exercising administrative power opens the door to “cronyism”, whereby access to public resources may be dependent on an individual´s personal relationship to politicians or  senior civil servants and those citizens who do not have such contacts are institutionally disadvantaged,

All three aspects of this approach to public administration contradict British common law notions of procedural fairness. A practical example may serve to illustrate this problem.

Let us imagine that the allocation of school places is officially determined by the distance a child lives from a particular school. Let us further imagine a situation in which this rule is not, because a politician or bureaucrat empowered to exercise the final decision on the allocation of school places has issued a “Weisung”, ordering the local education authority to give a particular child, who on a strict application of the criteria should not be eligible, a school place at the expense of a child that lives nearer. A parent, whose child as a result of such practices has been “wrongly” denied a place might seek an explanation from the local authority, only to be informed that the education authority is not obliged to and will explain its decisions. The parent´s attempts to have the decision overturned in court will fail, if the relevant legislation permits politicians to allocate places by decree and frees the local authority from an obligation to explain the reasoning behind its decisions.

In  Britain such a practice would be illegal. There is an excellent discussion of this British attitude to the exercise of executive power in the excellent book “The Rule of Law” written by Thomas Bingham who was Lord Chief Justice of England and Wales until 2008. According to Lord Bingham in the absence of an effective legal means to challenge the education authority`s decision, such an system would violate the rule of law.

There are two fundamental differences between the British and the continental approach to judicial review.

In  the first place Britain has no special administrative courts, only ordinary courts in which British citizens may call British civil servants and politicians to account for the manner in which they exercise power.

Secondly as a result of the common law tradition British courts have the general power to ensure that decisions taken by the state administration comply with fundamental principles of procedural fairness and natural law.  This does not mean that the courts can take decisions in the place of politician and civil servants.  The judges are not experts in the field and are not empowered by Parliament to do so. The role of the court can however quash the existing decision and order the relevant department to make another lawful decision.

Judges have continued to uphold the British attitude to judicial review even after Britain`s accession to the EU. Two quotations may serve to illustrate this:

In R v Home Office  (1997) Lord Steyn opined that

“the Rule of Law enforces minimum standards of fairness, both substantive and procedural”

and in R v Sec of State for the Environment (1991) the judge held that it is

“the necessary assumption that the court must supplement the procedural requirements which the Act stipulates by implying additional requirements said to be necessary to ensure that the principles of natural justice are observed….. The decided cases on this subject establish the principle that the courts will readily imply terms where necessary to ensure fairness of procedure for the protection of parties who may suffer a detriment in consequence of administrative action.”

According to Lord Bingham the rules of natural justice have traditionally been held to demand that

• A power must be exercised in a manner that is fair, in good faith, for the purpose the powers were conferred, and without exceeding the limits of those powers .
• The mind of the decision maker should not be tainted by bias
• Decisions should be made in the basis of stated criteria and that they should be amenable to legal challenge,

A British parent whose child was thus denied a school place in contravention of publicly stated criteria could therefore be optimistic about challenging the legality of such a decision in British court.

The ability of European citizens to ensure that their state administrations and political elites exercise power in such a way as to ensure that all citizens are treated equally by the state and  without regard to their social, political or economic standing is in contrast much more limited.

The continental European method of ruling by executive decree without may be considered to be a relic of absolutism and runs directly against the British tradition of democratic accountability and judicial review of executive action based on general principles of natural law or procedural fairness upheld by a politically independent judiciary.

The ramifications of this practice on the EU level were discussed in my previous article. For example institutions of the EU such as the European Commission or COREPER ( the Committee of Permanent Representatives which prepares and formulates EU law on behalf of the Council of Ministers) are executive bureaucracies not subject to parliamentary oversight or veto.

Although as a result of the expansion of government activity in the UK in the 20^th century and the concomitant need for a civil service capable of administrating the rapidly expanding welfare state,  Dicey´s doctrines can no longer be applied as purely in the 20^th century as in the 19^th century, Dicey´s  conception of the necessity for parliamentary accountability of law makers and procedural fairness in the judicial review of executive action remain dominant in British political culture. The law-making activities of EU bureaucrats are therefore instinctively viewed with scepticism in Britain whereas continental Europeans regard them as nothing more than a logical extension to the European level of the normal range of activities performed by national bureaucrats. A final and irrevocable integration of the UK into a unified European State would require the practice of judicial review based on common law principles by an independent judiciary as well as parliamentary accountability of lawmakers to be jettisoned in favour of the continental administrative law tradition. Such a development would finally demolish the doctrine of the absolute supremacy of the British Parliament and the principle that ministers and civil servants must respect the principles of fairness, objectivity and equality before the law in their exercise of power. The British people´s adherence to the doctrine that there can be no higher political authority than the House of Commons and that politicians and bureaucrats must be subject to the rule of law are probably the most potent arguments against EU membership and ones that have very deep roots in British political culture.

Britain´s Global Stance

From the 18^th to the 20^th century, when Britain was at the height of its power and prestige, the British ruling elite had a clear approach to foreign policy, which found its final expression in Mackinder`s Heartland theory of geopolitics: block any European power seeking to expand beyond Europe´s western border, rule the seas and pin down Asia.

Britain´s ruling elite has two components, the financial elite based in the city of London and the commercial class which traded on a global scale. At its greatest expansion the imperial trading zone stretched from Argentina  to East Asia, from Britain to South Africa,, from Canada to Australia.

Britain was at its most effective when it could align the interests of the financial elite based in the City of London with the nation`s commercial interests and harness the popular imagination in support of a national striving for global influence. Britain took little interest in continental European politics in peacetime, its eyes looked across the oceans, its global expansion beginning in the reign of Elisabeth the First in the 16<sup>th</sup> century with Britain´s  colonization of the New World.  And of course Britain, whose currency later became the world´s reserve currency and underpinned the classical gold standard,  took a keen interest in the global gold trade, establishing the city of London as the focal point of the world´s monetary system. From the 16<sup>th</sup> century, when British popular heroes like Sir Francis Drake  would seize gold laden Spanish galleons, to Churchillian adventures such as the Boer War, which gave Britain control of Southern Africa`s gold and diamond mines,  Britain´s imperial expansion managed to combine the export of British notions of civilizational improvement – spreading the Christian faith, building railways, creating civil services and modern government structures, providing justice and education – with enterprises which were also, or maybe even primarily, of a commercial and financial nature and aimed at strengthening Britain´s global power and  wealth. In some ways the global war on terror since 2001 echoes back to this imperial tradition, for on the one hand it professes to strive to make the world safe for democracy and to improve standards of governance and human rights in the Middle East and Central Asia, while at the same time ensuring that competition to the petrodollar standard is eliminated. One curious feature  of the War on Terror is that it often results in regime change in countries like Iraq or Libya whose governments were trying to free themselves from the petrodollar system, or even, as was the case in Libya, were planning to introduce gold backed currency.

The first world war with Germany, which cost Britain dearly, fundamentally changed Britain´s situation. Britain`s financial weakness forced it into a financial alliance with the USA, a relationship in which the USA became the dominant partner following the second world war. Nevertheless the British ruling class` desire for Britain to remain an actor with great influence on the world stage persisted, although the realisation that this could no longer be achieved through the formality of a British Empire led to a change in strategy aimed at dominating institutions of global governance in partnership with the USA.

The policy of integration into a  federally organized and centrally governed European Union, which would effectively transform the UK from a sovereign state  into the European equivalent of Texas, can only be considered an aberration in historical terms. It can therefore be no surprise that the British politicians who campaigned for accession to the EEC claimed Britain would be only participating in a free and common European market and  hid the fact that the aim of the project even then was to create a supranational state, whose laws and institutions would supersede the constitutions and parliaments of its member states.

When considering the behaviour of the British elite in the present debate, one must therefore differentiate between those who share this supranational goal, and those who remain wedded to promoting a distinctly British national interest.

One would expect the latter group to view the EU positively only in as far as it served as a mechanism for extending Britain´s global influence into Europe following the military victory in 1945. This would provide an explanation for  Britain´s enthusiasm for enlarging EU membership eastwards, even as far as Turkey, thereby creating a near identical membership list for both the EU and NATO, while simultaneously trying to slow down the process of European integration and harmonisation pursued by those members close to  Germany, who began the European project in the 1950s and  now form the backbone of the Eurozone.

There are undoubtedly those in Britain who would like to see Great Britain operating on the same level as countries like Finland and Hungary, but it is hard to imagine such a vision having much appeal to the financial and commercial elite in London, accustomed as they are to thinking and acting on a global scale. Some may also have seen EEC membership as a way  as a way of emancipating the UK from the USA, but breaking this special relationship was always unlikely, given the depth and breadth of the links between the two countries, which are not only financial, but are embedded in a common language, culture, legal system and history and  attitude to the business of global leadership. Membership in a fully integrated European Union is in any case no antidote to any perceived loss of British independence to the USA.

Recent developments in the EU have surely made the EU even less attractive to the British elite. The British government has lost influence over EU policy debates, not least because it has remained outside the Eurozone, which has been a source of so many problems in the past decade and consequently has occupied so much of the EU´s time, energy and imagination. The EU bureaucracy has begun  to articulate its own policy agenda in recent years, thus beginning a process of loosening ties with national governments while amongst those governments Germany has become the dominant force, setting the strategic agenda and leading the efforts to solve the many EU crises. Britain has lost standing in continental Europe and is perceived to be disinterested and disengaged.

The EU has become a wild card for the City of London. German Finance Minister Schauble`s attempt some years ago to empower EU institutions to  regulate the City of London must have been perceived as a serious threat by the City, accustomed as it is to enjoying privileges and autonomy that go back centuries.

It is therefore no surprise that the treaty changes Cameron has negotiated in his attempt to keep Britain in the EU include according to the BBC „safeguards for Britain’s large financial services industry which will protect the City of London and  prevent eurozone regulations being imposed upon it, as well as guarantees that Britain will never have to give up its currency autonomy or have to become part of a unified EU state.  

The question is, will this be enough? In recent years Britain has apparently moved to loosen its ties to the USA and open up to Asia suggesting that London is trying to remain a global player by adapting to changes  in the distribution of global power and influence. Particular attention should be paid to the flows of Gold from the West to China and India and how London and its London Bullion Market Association, which to this day remains the fulcrum of the gold market, reacts to these changes. The fact that Britain chose to join China´s Asian Infrastructure Investment Bank alongside Australia and South Korea against the express wishes of the Obama Administration is highly significant as is the fact that the Bank of China replaced Deutsche Bank as a participant in the London gold fix.  These developments would suggest that London has no intention of acting just within the confines of a European Union and particularly a Union beset by a multitude of crises, amongst which one may list sovereign debt, youth unemployment, demographic instability, currency uncertainty, unfunded pension and welfare state liabilities, an inability to solve problems, a lack of unity of purpose, and divisions both between member states and the institutions of the EU and between national governments and their electorates. Indeed a case can be made that German leadership of the EU has been disastrous for Europe and that the Britain should make plans for the eventuality that the EU will disintegrate under the weight of its internal contradictions, regardless of whether or not Britain votes to stay or leave.

I end with one last thought regarding the fact that the decision over Brexit will be reached through a popular referendum. It was argued earlier that Britain is most successful when its financial and commercial interests are aligned and the popular imagination is mobilized in support of these interests. For centuries this was the case as Britain expanded and built the Empire, and remained so during the  world wars of the 20^th century, even up to and through the cold war.  This unity of purpose has been increasingly lost in the last decades. This is of course not only a result of membership of the EU, globalization and the move to global governance have limited national governments´ ability to define and pursue distinctly national strategies. But it is hard to imagine that the EU will be able to  inspire the hearts and minds of the British electorate. Regardless of the outcome of the referendum in June, a more likely medium term development in these years of crisis is surely a return to and a reliance upon those constitutional and commercial arrangements that stood Britain in such good stead for so many years.

John Rhys James

Was born in Great Britain. Following a degree was in Political Science at the University of Bristol, where the focus of his studies was on the political systems of Eastern and Western Europe in the post war period, where he studied at the University of Music, Vienna. For 25 years he has been active as a musician and cultural manager in Europe, working for institutions such as the Vienna State Opera, Vienna Volksoper, Bayreuth Festival and Salzburg Festival. He is currently a lecturer at the University of Arts and Music, Vienna.  Alongside his artistic work he has maintained a keen interest in political and economic developments and has lectured and written on British Common Law, constitutional Law and comparative European legal systems as well as the influence of history on contemporary political developments in Europe. He has been a member since its inception of the Vienna Institute for Wertewirtschaft, an institute devoted to promoting and developing the philosophical tradition emanating from Carl Menger and Ludwig von Mises.