"Brexit", the process of the UK exiting the European Union, has been a fascinating topic for more than 2 years now. I had so many interesting things to write about blockchain in general and steem in particular that I only now get around to my first steem article on this topic. It's likely that more will follow.

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European Union

It is useful to set the stage by pointing to the trigger for this process: a longstanding disagreement over what "European Union" means, or "is for".

For the record, since its inception in the late '50-ies, the founding members (Germany, France, Italy, Netherlands, Belgium, and Luxembourg) have seen this "supranational" organisation as a means to gradually erode, "sand down" the sharpest and most dangerous sides of "nationalism" and create a large area where people would be so close to one another that "making war to the neighbors" would become absurd.

This was clearly and explicitly laid down in the treaties of that time. Economic cooperation - winding down of tariffs, harmonization of national rule books was seen as a means to the end of "ever closer union"

Yet economic cooperation also led to prosperity and affluence. While the young "European Economic Community" (EEC, the precursor to the present-day EU) was prospering, back in the '60-ies, the United Kingdom was rapidly losing its Empire and underwent a rapid economic decline. To counter that, the UK knocked on the door of the EEC. They wanted the EEC to throw it an economic life belt.

The French President of that time, Général Charles De Gaulle thought that letting the UK join the club would undermine the objective ("ever closer union", i.e. taking out the pointy spikes out of "nationalism") even if it might increase overall economic prosperity. Thus he veto-ed the UK applications to join twice, in 1963 and 1967.

The UK managed to join the EEC only after De Gaulle's death, in 1971, but it never embraced the credo of the founders. It has always insisted on staying on purely economic terms and this purposeful ambiguity strained the relationship to breaking point.

Brexit stakes

On the "Irish border" issue, the motives, in my personal analysis, are as follows

1. For Ireland, a member of the EU, it is a topic they can play to tilt the balance toward unifying Northern Ireland with the Republic. Northern Ireland, by the way, voted "Remain"
2. For the Brits, the stakes are manifold: they want of course to have AND eat cake; they definitely do not want to lose Northern Ireland for reasons of national pride; and after the botched early elections, reliant on the DUP votes for shoring up the Tory government, they can't afford to lose Northern Ireland
3. For the rest of the EU, it is a matter of solidarity with fellow Ireland ... for about 5%. The remaining 95% is mostly about sticking it to the Brits.

What are the realistic options?

1. UK blinks first and accepts a border in the Irish Sea, effectively splitting Northern Ireland from the rest of UK. With the current government dependent on the DUP votes, that seems unlikely to happen.
2. EU blinks first and starts erecting custom barriers on the Republic side of the border. Shrill accusations are hurled around, the climate degenerates and the acrimony increases. This paves the way for the nastiest of no-deal Brexits that justifies EU stripping off every possible concession they might have granted to the UK during the negotiations. The big countries are rubbing their hands in glee as large swathes of City business has to migrate to the Continent in a panic, followed by industrial installations: with Carlos Ghosn, a Frenchman at its helm, why would the best Nissan factory be in Sunderland rather than in the North of France that so badly needs jobs? Republic of Ireland is given an empathetic glance, some financial compensation in disguise and everybody will move on ...

Conclusion

So here it is, my prediction about how the "Irish border" issue will play out in the Brexit saga.

Overall, from a game theoretical standpoint, both the EU politicians' and Theresa May' dominant strategy is a no-deal, crash Brexit.

For the EU, it maximizes the benefit:

1. At the political level - it shows that leaving the EU is a dumb idea
2. At the economic level - after a brief period of pain and disruption, more and more businesses will realize they are better off inside the EU borders than outside and will feel compelled to relocate, bringing jobs and capital to the Continent. Of course, not all 27 stand to gain. The biggest losers risked being the Dutch, because of their extensive trade relationships with the UK. They have been bought off with the European Medicines Agency, which is a magnet for the pharma industry.

For Theresa May - it's the only way to stand a chance of staying in power and fending off the stabs of the hard brexiteers (Johnson and Gove and all the rest behind them)

If you know what witnesses are and agree that people commited to keeping this blockchain ticking play an important role ...

(by simply clicking on the picture - thanks to SteemConnect)

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