Britain struggles to absorb Brexit’s political and financial impact – Washington Post

After a tumultuous Friday that saw world financial markets plummeting and the British prime minister announcing his intention to resign, British voters began to digest Saturday the full and enormous consequences of their historic decision to break with Europe and begin to refashion their country.

The weekend morning provided an opportunity for a brief, if artificial, pause for many people to absorb and even reflect on what has happened here over the past two days — a seismic shock to the political and financial systems as well as a leap into a world that few imagined possible just days ago.

Behind the scenes, there was a flurry of activity as leading Conservative Party politicians began maneuvering to replace Prime Minister David Cameron, while Jeremy Corbyn, the leader of the Labour Party, was confronted with a revolt in his party’s ranks that threatened to make him one more victim of the Brexit fallout. Corbyn said Saturday morning that he would not stand down voluntarily and would contest any new leadership election.

Meanwhile, in Scotland, one area of the United Kingdom that voted to remain in the European Union, the Scottish cabinet was scheduled to meet to consider a new push to declare independence in a move that eventually could bring another wrenching change to an island nation that is now operating without a clear road map.

The United Kingdom could undergo further dismantling if Nationalists in Northern Ireland, which also voted to remain in the European Union, press ahead with their calls for a vote on Irish reunification.

Saturday’s British newspaper headlines captured the emotions of a divided nation reeling with the implications of Thursday’s vote. “Birth of a New Nation,” said the Daily Telegraph. “Brexit Earthquake,” said the Times. The Daily Mail said, “Take a Bow, Britain,” while the Daily Mirror said, “So what the hell happens now?”

Just how much time British officials will have to undertake a relatively orderly transition to life apart from the European Union wasn’t clear this weekend. Cameron, in his announcement of resignation, said the country would not trigger the formal process of withdrawal until after a new prime minister is in place —hopefully, he said, by October.

But E.U. Commission President Jean-Claude Juncker said those negotiations should begin as soon as possible. E.U. leaders expressed concern that undue delays in beginning the divorce proceedings, which would take two years to fully implement, could only add to the uncertainty that has been created.

Meanwhile, the foreign ministers from six founding E.U. nations were set to meet Saturday in Berlin in an effort to prevent further disintegration of European unity in the wake of the British decision.

Britain’s leaders sought to offer reassurances that the Thursday vote, which carried by 52 percent, would be dealt with in an orderly fashion, with every effort made to minimize the financial and other disruptions caused by the reaction to an outcome that few had fully anticipated.

Cameron promised to remain as a caretaker through the summer as a new leader is being chosen and said, “I will do everything I can as prime minister to steady the ship over the coming weeks and months.

The market gyrations prompted Bank of England Governor Mark Carney to try to calm investors with a statement asserting that the bank was “well prepared” for the referendum’s outcome. The central bank, Carney said, was ready to intervene to prop up the economy.

In an extraordinary sign of Britain’s vulnerability as its vaunted currency plunged, the country’s fellow members in the Group of Seven club of wealthy nations issued a statement expressing confidence in the British economy — and vowing to take action to protect it. Cameron also sought to reassure jittery markets, calling Britain’s economy “fundamentally sound” and saying there would be no immediate changes in the status of immigrants in the country.

The prime minister, in office since 2010, said he was stepping aside because the country deserved “fresh leadership” after he was unable to persuade a majority of voters to back his call to stay in Europe. “The British people have voted to leave the European Union, and their will must be respected,” he said.

The close and unexpected vote left Britain a deeply divided country, both geographically and demographically. Much of England cast ballots to break with Europe, while voters in London, along with those in Scotland and Northern Ireland, voted to keep the status quo in place.

The Brexit referendum split the country by age, with younger voters strongly in favor of remaining in Europe and older voters heeding the calls of the leaders of the “Leave” campaign to take back control of their country from what was pilloried as a faceless and intrusive bureaucracy in Brussels.

Cameron’s decision to step down set off an instant contest to replace him. Former London mayor Boris Johnson — a leading campaigner for the anti-E.U. cause — was considered the odds-on favorite. Johnson was mobbed outside his house in north London early Friday, with some cheering but far more jeering a man whom many pro-E.U. Londoners blame for the outcome of Thursday’s referendum. “Shame on you!” some yelled.

In his first remarks after the vote, an uncharacteristically serious and even somber Johnson told reporters he was “sad” about Cameron’s resignation. He described the prime minister, a longtime friend and rival, as “one of the most extraordinary politicians of our age.”

The mop-haired Johnson did not say whether he would seek Cameron’s job. He did praise voters for rejecting the E.U., describing it as “a noble idea for its time” but one that “is no longer right for this country.”

“I believe we now have a glorious opportunity,” he said. “We can pass our laws and set our taxes entirely to the needs of the U.K. economy.”

Cameron’s successor will not be picked by the general public but instead in an internal process by his Conservative Party.

Since taking office in 2010, Cameron had sought to move the Tories toward the political center, championing gay marriage and taking a softer line on immigration than some in the party had sought.

But his repudiation in Thursday’s vote — fueled by an anti-immigration backlash — is likely to leave the party’s more hard-line anti-E.U. wing ascendant.

The domestic political backlash in Britain was not limited to the Tories: A pair of senior Labour Party members launched an attempt to oust their leader, the hard-left Jeremy Corbyn, following a lackluster Labour campaign to deliver an “in” vote.

Cameron’s pro-E.U. side had the backing of nearly every major world leader, including President Obama. In a statement Friday, the American president spoke of the deep U.S. bonds with Britain and the E.U. and said both would endure. After speaking with Cameron and German Chancellor Angela Merkel, Obama later expressed confidence that Britain “is committed to an orderly transition out of the E.U.” The vote reflects “the ongoing changes and challenges that are raised by globalization,” he said at a conference at Stanford University.

“But while the U.K.’s relationship with the E.U. will change, one thing that will not change is the special relationship between our two nations,” Obama said. “That will endure. The E.U. will remain one of our indispensable partners. The NATO alliance will remain a cornerstone of our global security.”

Meanwhile, presumptive Republican presidential nominee Donald Trump, who was in Scotland on Friday to open a golf course, celebrated the Brexit vote and said he saw parallels with his own anti-establishment campaign. “They took back their country,” said Trump, who sported a white “Make America Great Again” cap and was serenaded by bagpipers as he toured his course. “That’s a great thing.”

Iranian and Russian officials also cheered Britain’s vote, with a senior Iranian adviser to the country’s president tweeting that “the stars of the E.U.’s flag are falling down.”

Britain’s exit will indeed have a profound effect on the E.U., which will lose a major military and diplomatic power. “This looks to be a sad day for Europe and for Britain,” said Germany’s foreign minister, Frank-Walter Steinmeier.

Polls had forecast a narrow victory for “remain,” and most analysts concurred. But in the end, “leave” won by more than a million votes — out of some 33 million cast, representing nearly three-quarters of eligible voters.

The “remain” campaign won wide majorities in Scotland and London. The “leave” camp racked up resounding victories across provincial England, winning in small towns, rural areas and struggling postindustrial cities.

In a campaign marked by a relentlessly negative tone from both sides, “remain” was never able to answer charges from the “leave” campaign over immigration. Backed by the tabloid press, Brexit leaders portrayed the E.U. as an open door to millions of immigrants who threatened to change the country’s cultural fabric.

Instead of engaging on the issue, the “remain” camp changed the subject: It warned of the economic and political perils of departure — a line of attack that the pro-Brexit camp denounced as “Project Fear.”

But if Friday was an indication, the fear had real grounding.

Jeremy Greenstock, a retired senior British diplomat, wrote in an analysis that the effects seen Friday were just the beginning and that Britain should brace for serious economic damage from job cuts, tax hikes, higher interest rates and reduced foreign investment.

Greenstock, now chairman of the Gatehouse Advisory firm, also warned that Britain would have less international clout for the foreseeable future. “The people of the U.K. are looking at a period of at least a decade when their economy and their global impact will stand at lower levels as a result of this decision,” he said. “This will have to be adjusted to.”

Karla Adam in London and Brian Murphy in Washington contributed to this report.

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