The Importance of Sovereignty.

• Author: Connolly, Bernard

Brexit is a beacon of hope in the world and for the world. But the lessons of Brexit, notably for the United States and the European Union, are at risk of being misrepresented and ignored.

It took four-and-a-half years, but the Establishment campaign to frustrate the result of the 2016 referendum has ended in defeat. Britain is out, even at the cost of the quasi-colonization of Northern Ireland. Guy Verhofstadt, the Belgian politician who was in charge of the so-called European Parliament's oversight of the Brexit negotiations, had previously revelled in the capitulation by then-Prime Minister Theresa May and her coterie, telling his subordinates that May was giving him what he had always wanted--making the whole of the United Kingdom a colony of the European empire. Verhofstadt was in effect echoing what then-president of France Georges Pompidou had told his chief negotiator in 1970, when sensing a similar capitulation by one of May's predecessors, Edward Heath (who, not coincidentally, detested all aspects of American society and culture other than, apparently, American football): "Je la [la Grande Bretagne] veux nue."

The European Union's defeat--the defeat of spite-filled obscurantism--and Britain's victory--the victory of optimism--were hailed by the markets, as the Project Fear promulgated by former Chancellor George Osborne has been shown to have been the nonsense the British electorate always knew it to be.

Notably, the UK financial sector is, as I had predicted, in a much better position as a result of having been left out of the agreement with the European Union. I wrote more than a decade ago that the City of London would be targeted for punishment by the European Union whether Britain remained in the European Union or left. ("Regulation: Reform or Revenge? The Crisis, the EU and British financial markets," Law and Financial Markets Review, September 2009.) But, I added, it is better to be targeted for only a small proportion of one's overall business--certain international transactions, with the European Union and/or in euros--than if the whole of the financial sector is subject to deliberately punitive measures imposed by a determinedly anti-City imperial authority. It should not be forgotten that the City, moribund for two decades after the war, was brought back to life by foreign regulation: Regulation Q in the United States, which led to the creation of eurodollar markets in London. Now the City has made its escape and is no longer subject to the smog of EU regulation still choking its rivals.

To achieve a favorable...