1 00:00:02,533 --> 00:00:04,633 JUDY WOODRUFF: As we reported earlier, British Prime Minister Theresa May announced her Cabinet 2 00:00:04,633 --> 00:00:09,233 had approved a deal between the United Kingdom and the European Union on the terms for Brexit. 3 00:00:11,166 --> 00:00:15,600 It comes nearly two-and-a-half years after Britain narrowly voted to leave the E.U. 4 00:00:17,600 --> 00:00:20,500 Foreign affairs correspondent Nick Schifrin reports on the terms of separation, and why 5 00:00:20,500 --> 00:00:22,633 there's still a long way to go. 6 00:00:22,633 --> 00:00:27,633 NICK SCHIFRIN: In the European Union, when it comes to divorce, as is always the case, 7 00:00:27,633 --> 00:00:31,933 the hardest negotiations can be over property, money and the children. 8 00:00:31,933 --> 00:00:35,900 And so it is with Brexit, a divorce where there's not only two sides, but the British 9 00:00:35,900 --> 00:00:39,100 family is fighting within itself. 10 00:00:39,100 --> 00:00:43,000 Prime Minister Theresa May is proposing a kind of divorce with a transition period of 11 00:00:43,000 --> 00:00:45,533 remaining friends as the best deal possible. 12 00:00:45,533 --> 00:00:49,166 THERESA MAY, British Prime Minister: The choice was this deal, which enables us to take back 13 00:00:49,166 --> 00:00:54,133 control and to build a brighter future for our country, or going back to square one, 14 00:00:56,066 --> 00:00:59,300 with more division, more uncertainty, and a failure to deliver on the referendum. 15 00:00:59,300 --> 00:01:03,766 NICK SCHIFRIN: On property, the sticking point has been the border between Northern Ireland, 16 00:01:03,766 --> 00:01:08,433 part of the U.K., and the Republic of Ireland, a separate country that's part of the E.U. 17 00:01:08,433 --> 00:01:12,633 Today, cars can pass easily because there is effectively no border. 18 00:01:12,633 --> 00:01:17,466 The Brexit agreement prevents the return of a hard border by temporarily keeping Northern 19 00:01:17,466 --> 00:01:19,366 Ireland inside the E.U. 20 00:01:19,366 --> 00:01:23,633 Customs Union, avoiding customs checks between Northern Ireland and Ireland. 21 00:01:23,633 --> 00:01:28,400 On money, Britain would continue to pay the E.U. as much as $80 billion for decades. 22 00:01:28,400 --> 00:01:33,200 And, as for the children, British citizens living in the E.U. and E.U. citizens living 23 00:01:33,200 --> 00:01:38,066 in Britain, they would maintain current residence and Social Security rights. 24 00:01:38,066 --> 00:01:41,766 This morning in Parliament, May presented the deal as the kind of divorce mandated by 25 00:01:41,766 --> 00:01:43,466 the Brexit referendum. 26 00:01:43,466 --> 00:01:46,933 THERESA MAY: We will take back control of our money, laws and borders. 27 00:01:46,933 --> 00:01:51,900 We will deliver Brexit, and the United Kingdom is leaving the European Union on the 29th 28 00:01:52,533 --> 00:01:54,566 of March 2019. 29 00:01:54,566 --> 00:01:58,966 NICK SCHIFRIN: But May's critics from her own party say the break isn't hard enough. 30 00:02:00,933 --> 00:02:03,533 Leading Brexit proponent Jacob Rees-Mogg wants a divorce that's a cleaner split. 31 00:02:03,533 --> 00:02:05,633 JACOB REES-MOGG, British Parliament Member: Well, she hasn't so much struck a deal as 32 00:02:05,633 --> 00:02:09,700 surrendered to Brussels and given into them on everything they want, and tried to frustrate 33 00:02:09,700 --> 00:02:13,300 Brexit, that it is not so much the vassal state anymore as the slave state. 34 00:02:13,300 --> 00:02:16,366 NICK SCHIFRIN: Critics on the right argue staying in that E.U. 35 00:02:16,366 --> 00:02:20,966 Customs Union prevents the U.K. from making bilateral trade deals, and binds the U.K. 36 00:02:20,966 --> 00:02:23,633 to draconian E.U. trade rules. 37 00:02:23,633 --> 00:02:28,100 And the leader of a member of Theresa May's coalition, Northern Ireland's Democratic Unionist 38 00:02:28,100 --> 00:02:33,100 Party head Arlene Foster, fears the Ireland border deal doesn't guarantee Northern Ireland's 39 00:02:34,233 --> 00:02:36,733 integrity inside the United Kingdom. 40 00:02:36,733 --> 00:02:38,433 ARLENE FOSTER, Leader, Democratic Unionist Party: It's a question of whether we are dealing 41 00:02:38,433 --> 00:02:41,966 with the United Kingdom in a way that leaves us adrift in the future. 42 00:02:41,966 --> 00:02:45,466 And as the leader of Unionism in Northern Ireland, I'm not about to agree to that. 43 00:02:45,466 --> 00:02:49,266 NICK SCHIFRIN: The next step, is the E.U. must approve, and then the British Parliament 44 00:02:49,266 --> 00:02:51,266 has to agree. 45 00:02:51,266 --> 00:02:55,066 And analysts predict that the most difficult step of a divorce that's already been hard 46 00:02:55,066 --> 00:02:57,166 on everyone. 47 00:02:57,166 --> 00:03:01,066 So, where does the Brexit process go from here, and what about the future of the U.K., 48 00:03:01,066 --> 00:03:04,066 the E.U., and the wider European project? 49 00:03:04,066 --> 00:03:08,233 For that, we turn to Sebastian Mallaby, longtime author and journalist and the Paul Volcker 50 00:03:08,233 --> 00:03:12,033 senior fellow for international economics at the Council on Foreign Relations. 51 00:03:12,033 --> 00:03:13,666 He joins me from London. 52 00:03:13,666 --> 00:03:16,466 Sebastian Mallaby, thank you very much for coming on the "NewsHour." 53 00:03:16,466 --> 00:03:21,266 There is a lot of reporting tonight about how difficult it was for Theresa May to get 54 00:03:21,266 --> 00:03:23,366 this through her Cabinet. 55 00:03:23,366 --> 00:03:25,400 Why so challenging? 56 00:03:25,400 --> 00:03:27,400 SEBASTIAN MALLABY, Council on Foreign Relations: This has been a drawn-out process, during 57 00:03:27,400 --> 00:03:32,333 which negotiating a deal with the 27 countries of the European Union has delivered a cold 58 00:03:34,266 --> 00:03:39,066 reality shock to those who supported Brexit, because the promises made in the referendum 59 00:03:41,300 --> 00:03:44,233 have proven very hard to realize in practice. 60 00:03:44,233 --> 00:03:49,233 So, we have a deal, at least a draft of a deal, which, ironically, is not pleasing to 61 00:03:50,666 --> 00:03:52,800 the people who wanted to leave the European Union. 62 00:03:52,800 --> 00:03:57,800 So, those who argued for Brexit are now saying that the Brexit implementation is not good 63 00:03:58,333 --> 00:04:00,500 enough. 64 00:04:00,500 --> 00:04:04,300 And that's why Theresa May has faced enormous resistance from the right flank of her party 65 00:04:05,733 --> 00:04:07,800 that wanted a harder break with the rest of Europe. 66 00:04:07,800 --> 00:04:10,900 NICK SCHIFRIN: And so we heard from some of those Brexiters in the story we just played. 67 00:04:10,900 --> 00:04:15,166 We also heard from some of the challenges from within her coalition. 68 00:04:15,166 --> 00:04:18,733 How difficult will it be, therefore, to get through Parliament? 69 00:04:18,733 --> 00:04:22,166 SEBASTIAN MALLABY: Parliament is going to be a very tough challenge. 70 00:04:22,166 --> 00:04:27,166 Theresa May's Conservative government only has a majority by virtue of the support of 71 00:04:28,300 --> 00:04:31,166 the small Northern Irish party, the DUP. 72 00:04:31,166 --> 00:04:35,333 That party is threatening for now that it would vote against the deal. 73 00:04:35,333 --> 00:04:40,333 And since the Labor Party will mostly oppose the deal too, it only takes a few rebels from 74 00:04:42,366 --> 00:04:46,066 the Conservative ranks, let's say 20 or 30, to really tip this into the territory where 75 00:04:47,266 --> 00:04:48,966 you can't imagine it going through. 76 00:04:48,966 --> 00:04:52,366 And it does look at the moment that that's how it will turn out. 77 00:04:52,366 --> 00:04:56,733 NICK SCHIFRIN: And I want to ask about some of the specific criticism from the Democratic 78 00:04:56,733 --> 00:05:00,200 Unionist Party from Northern Ireland, part of the coalition. 79 00:05:00,200 --> 00:05:05,133 They worry that this deal basically puts them closer to the European Union than it does 80 00:05:06,466 --> 00:05:07,466 to the United Kingdom. 81 00:05:07,466 --> 00:05:09,500 Do they have a point? 82 00:05:09,500 --> 00:05:13,866 SEBASTIAN MALLABY: Well, their position is that they didn't want anything, even a hint 83 00:05:13,866 --> 00:05:18,866 of anything that could drive a wedge between Northern Ireland and mainland Britain. 84 00:05:20,833 --> 00:05:24,366 For now, that isn't happening, because the interim deal is that the whole of Britain 85 00:05:26,266 --> 00:05:28,133 stays inside the E.U. 86 00:05:28,133 --> 00:05:30,300 Customs Union. 87 00:05:30,300 --> 00:05:34,133 And, therefore, there's a sort of hypothetical, theoretical objection which the Northern Irish 88 00:05:34,700 --> 00:05:36,366 have. 89 00:05:36,366 --> 00:05:39,100 It isn't actually something that's going to bite anytime soon. 90 00:05:39,100 --> 00:05:44,100 So it's possible, in terms of the politics, that the Northern Irish constituency will 91 00:05:45,533 --> 00:05:48,866 be persuaded in the end to back Theresa May's deal. 92 00:05:48,866 --> 00:05:51,566 And that could make all the difference in terms of parliamentary passage. 93 00:05:51,566 --> 00:05:53,666 NICK SCHIFRIN: Let's zoom out a little bit. 94 00:05:53,666 --> 00:05:58,666 E.U. officials who I have talked to, who talk publicly say that we had to exact some revenge, 95 00:06:00,666 --> 00:06:04,100 we had to make this process difficult on the United Kingdom, in order to prove that -- to 96 00:06:06,100 --> 00:06:09,000 other countries who might think about exiting that they shouldn't try this. 97 00:06:09,000 --> 00:06:12,033 Do you think the E.U. officials who have said that, have they succeeded? 98 00:06:12,033 --> 00:06:15,566 SEBASTIAN MALLABY: It's true that there is a populist government in Italy. 99 00:06:15,566 --> 00:06:18,900 There are populists on the rise in Germany and so forth. 100 00:06:18,900 --> 00:06:23,900 And, therefore, there is a desire to teach those populists the consequences of their 101 00:06:23,900 --> 00:06:26,366 anti-E.U. rhetoric. 102 00:06:26,366 --> 00:06:30,233 But there's also been a desire, I think, particularly in Germany, to try to have as decent a relationship 103 00:06:31,100 --> 00:06:33,566 with Britain as they can. 104 00:06:33,566 --> 00:06:36,866 In fact, the vindictiveness has been a mixed picture. 105 00:06:36,866 --> 00:06:41,866 And I don't really view the outcome of this deal as the product of European vindiction. 106 00:06:43,733 --> 00:06:47,400 They had less to fear from a zero deal scenario than Britain did. 107 00:06:47,400 --> 00:06:50,200 And so the Europeans did get more of what they wanted. 108 00:06:50,200 --> 00:06:53,833 NICK SCHIFRIN: And the pressure on the E.U. isn't only, of course, Brexit. 109 00:06:53,833 --> 00:06:55,933 You mentioned populism. 110 00:06:55,933 --> 00:07:00,700 Migration through Europe has helped push German Chancellor Angela Merkel out of her job. 111 00:07:02,233 --> 00:07:04,200 What is the state right now of the European integration project? 112 00:07:04,200 --> 00:07:06,300 SEBASTIAN MALLABY: I mean, it's pretty fragile. 113 00:07:06,300 --> 00:07:10,900 And so when you look at a highly indebted economy like Italy, which, unlike Greece, 114 00:07:12,333 --> 00:07:14,700 is too big to be bail out -- it's too big to bail. 115 00:07:14,700 --> 00:07:16,500 And right now, it has a populist government. 116 00:07:16,500 --> 00:07:19,400 The economic path is looking pretty dicey. 117 00:07:19,400 --> 00:07:24,400 And so you could easily imagine a resumption of the Eurozone crisis of a few years ago. 118 00:07:25,533 --> 00:07:27,433 So, that's tension number one in Europe. 119 00:07:27,433 --> 00:07:31,733 And the second, as you mentioned, is migration, which has temporarily abated. 120 00:07:31,733 --> 00:07:35,533 There was the big surge in 2015. 121 00:07:35,533 --> 00:07:36,800 But now -- in 2016. 122 00:07:36,800 --> 00:07:38,633 But now that's gone down. 123 00:07:38,633 --> 00:07:40,700 It will come back again. 124 00:07:40,700 --> 00:07:44,666 And so I foresee that these arguments about migration, tensions over the single currency 125 00:07:46,100 --> 00:07:49,500 are going to come back, and it's going to be tough for Europe. 126 00:07:49,500 --> 00:07:53,000 The ambitions of a few years ago were, let's carry on deepening. 127 00:07:53,000 --> 00:07:55,400 Let's carry on even enlarging. 128 00:07:55,400 --> 00:07:57,466 That has gone away. 129 00:07:57,466 --> 00:08:00,300 NICK SCHIFRIN: Sebastian Mallaby with the Council on Foreign Relations, thank you very much. 130 00:08:01,233 --> 00:08:02,066 SEBASTIAN MALLABY: Thank you.