"It's not over yet. The European Union without Britain would not be a European Union. It would lose a significant part of Europe and an essential cornerstone of the post-war European peace project. The narrow Brexit vote need not be a final decision on UK membership, but it is a wake-up call to all European partners and European leaders. There is room and there is time for second thoughts, new resolutions and making up.
It would be a big mistake for the other members to react with childish disappointment: "If you want to leave us, go ahead". It would also be a big mistake to launch half-baked initiatives for big steps towards greater integration within a "core Europe", thus forcing Britain out.
Rather, we have to acknowledge that many European citizens, not only in Britain, desire substantial sovereignty at the national level. The expression of national identity and the desire for self-determination cannot be satisfied with football competitions alone. Rather than mechanically calling for ever closer integration, and expecting every crisis to lead automatically to "more Europe" aka "more transfer of sovereignty to supra-national institutions", we need to think carefully about how to re-calibrate European institutions such that they achieve the right balance of supra-national powers and national sovereignty.
For the euro area this means, for example, that we need to ensure that domestic fiscal sovereignty can coexist with a stable monetary union. The rules have been improved, but they need to be applied, and a few things remain to be done.
Actually, Tuesday's OMT decision by the Federal Constitutional Court of Germany provides a good example of striking this balance. The judges avoided open conflict with the European Court of Justice. Yet they used their freedom to criticize the particular reasoning that led the ECJ to its decision. They interpreted it in their judgment to put in place demarcations that the German government and the Bundesbank have to observe, if the latter wishes to participate in a possible future implementation of OMT. It's the Court's task to act as guardian of the Basic Law, that is the German Constitution, and thereby it contributes to the stability of a heterogeneous European Union."
