Like many Brits, I’m reeling. Everyone knew that the "Brexit" referendum was going to be close. But deep down I think many of us assumed that the vote would be to remain in the European Union. David Cameron had no realistic choice but to announce that he will step down.

Mr. Cameron’s fall can be traced back to a promise he made in the 2010 election to cap the annual flow of migrants into the U.K. at less than 100,000, "no ifs, no buts."Membership in the EU means free movement of labor, so this was an impossible goal to reach through direct policy. I served in the coalition government that emerged from the 2010 election, and this uncomfortable fact was clear from the outset. I don’t share the contents of briefings and meetings from my time in government (I think it makes good government harder if everyone is taking notes for memoirs), but my counterpart in the government, Mr. Cameron’s head of strategy, Steve Hilton, went public in the Daily Mail just before this week’s vote.

Steve recalled senior civil servants telling us bluntly that the pledged target could not be reached. He rightly fulminated about the fact that this meant we were turning away much more skilled and desirable potential immigrants from non-EU countries in a bid to bring down the overall number. What he didn’t say is that the target, based on an arbitrary figure, was a foolish pledge in the first place.

Mr. Cameron was unable to deliver on his campaign pledge, and immigration to the U.K. has been running at about three times that level. This fueled anger at the establishment for again breaking a promise, as well as anger at the EU. In an attempt to contain his anti-European right wing, Mr. Cameron made another rash promise: to hold a referendum.

The rest, as they say, is history. And now, so is he.

Immigration played a role in the Brexit campaign, though it seems that voters may not have made a clear distinction between EU and non-EU inward movement. Still, Thursday’s vote was, at heart, a plebiscite on what it means to British. Our national identity has always been of a quieter kind than, say the American one. Attempts by politicians to institute the equivalent of a Flag Day or July Fourth, to teach citizenship in schools, or to animate a “British Dream” have generally been laughed out of court. Being British is an understated national identity. Indeed, understatement is a key part of that identity.

Many Scots, Welsh and Northern Irish feel a much stronger affinity to their home nation within the U.K. than they do to Great Britain. Many Londoners look at the rest of England and wonder how they are in the same political community. These splits were obvious Thursday.

Identity politics has tended in recent years to be of the progressive kind, advancing the cause of ethnic minorities, lesbians and gays, and so on. In both the U.K. and the U.S. a strongly reactionary form of identity politics is gaining strength, in part as a reaction to the cosmopolitan, liberal, and multicultural forms that have been dominant. This is identity politics of a negative kind, defined not by what you are for but what you are against. A narrow majority of my fellow Brits just decided that at the very least, being British means not being European. It was a defensive, narrow, backward-looking attempt to reclaim something that many felt had been lost. But the real losses are yet to come.

Editor's Note: This piece originally appeared in the Wall Street Journal's Washington Wire.

We tend to think of having a formal identity as an enabler for social and economic inclusion, but in fact identity can have entirely the opposite effect. Once socioeconomic interactions are based on a standardized notion of identity, it is likely that social status based on past achievements, family histories, personal connections, political backing, wealth and education levels will influence socioeconomic outcomes — thereby potentially reinforcing the established class hierarchy. Systems that are based on anonymity might in fact be the most equitable and inclusive, in the sense of ensuring equal participation by all, by systematically stripping out social status.

But anonymous systems carry a high cost in terms of efficiency. Reputations would be impossible to establish, contracts would be hard to enforce, and there would be more insecurity as it would be much harder to track and clamp down on illicit activities. It is therefore not at all certain that the poorer segments of the population would be better off in absolute terms if the economy worked on the basis of anonymity.

The need for digital identities for inclusive access

In fact, giving lower-income people digital identities would make it possible for them to participate in the modern digital economy in many ways: to open accounts and receive moneys from anyone, assert their rights over digital services they have contracted and digital assets they have purchased, settle disputes, etc. But establishing a formally recognized identity can be a major hurdle in itself, especially in countries that do not have digitized national ID schemes.

It is ironic that the difficulty of establishing formal identity in the first place often prevents so many lower-income, and especially rural, people from accessing digital services. Identity systems with selective coverage of the population create a double whammy of inequality: on the one hand, these partial systems help the haves to carry their social and economic status symbols and reputations into every market interaction they are engaged in, and on the other they negate digital visibility and access to digital services for the have not´s.

We argue in a new research paper that it should be the government´s responsibility to ensure that every citizen in fact has a digital identity, not merely to create a platform that enables people to have digital identities. The Indian government´s Aadhar push to provide everyone in India with a unique number ID linked to biometrics is a good example of such a policy.

The demands of identity verification systems

The problem is that different policy agendas converge on the issue of identity and have different requirements for a digital identity platform. What works as an identify standard for financial systems may not be good enough for law enforcement agencies. The risk is that governments adopt the highest standard, with the result that the inclusion agenda and the needs of the poor are ignored.

If there is no centralized government system for identity, then what we need is a system that:

1. Lets the issue of identity be resolved in the first instance within the communities where poor people live, shop and work (e.g. through attestation by known local figures)
2. Draws people into seeking and improving their digital identities over time, much in the way that they develop their social network over time.

This is the notion of social identity. Let people with meager resources help each other overcome their limitations: each may have very little voice, but collectively they represent a potentially vast information system for official identification purposes. That is hard to reconcile with the way governments and formal institutions tend to handle identity verification: in silos, contained within databases and cards. We need more flexible notions of identity, which build layers of identity information and verification through social networks – as well as bureaucratized ID-seeking processes.

Like many Brits, I’m reeling. Everyone knew that the "Brexit" referendum was going to be close. But deep down I think many of us assumed that the vote would be to remain in the European Union. David Cameron had no realistic choice but to announce that he will step down.

Mr. Cameron’s fall can be traced back to a promise he made in the 2010 election to cap the annual flow of migrants into the U.K. at less than 100,000, "no ifs, no buts."Membership in the EU means free movement of labor, so this was an impossible goal to reach through direct policy. I served in the coalition government that emerged from the 2010 election, and this uncomfortable fact was clear from the outset. I don’t share the contents of briefings and meetings from my time in government (I think it makes good government harder if everyone is taking notes for memoirs), but my counterpart in the government, Mr. Cameron’s head of strategy, Steve Hilton, went public in the Daily Mail just before this week’s vote.

Steve recalled senior civil servants telling us bluntly that the pledged target could not be reached. He rightly fulminated about the fact that this meant we were turning away much more skilled and desirable potential immigrants from non-EU countries in a bid to bring down the overall number. What he didn’t say is that the target, based on an arbitrary figure, was a foolish pledge in the first place.

Mr. Cameron was unable to deliver on his campaign pledge, and immigration to the U.K. has been running at about three times that level. This fueled anger at the establishment for again breaking a promise, as well as anger at the EU. In an attempt to contain his anti-European right wing, Mr. Cameron made another rash promise: to hold a referendum.

The rest, as they say, is history. And now, so is he.

Immigration played a role in the Brexit campaign, though it seems that voters may not have made a clear distinction between EU and non-EU inward movement. Still, Thursday’s vote was, at heart, a plebiscite on what it means to British. Our national identity has always been of a quieter kind than, say the American one. Attempts by politicians to institute the equivalent of a Flag Day or July Fourth, to teach citizenship in schools, or to animate a “British Dream” have generally been laughed out of court. Being British is an understated national identity. Indeed, understatement is a key part of that identity.

Many Scots, Welsh and Northern Irish feel a much stronger affinity to their home nation within the U.K. than they do to Great Britain. Many Londoners look at the rest of England and wonder how they are in the same political community. These splits were obvious Thursday.

Identity politics has tended in recent years to be of the progressive kind, advancing the cause of ethnic minorities, lesbians and gays, and so on. In both the U.K. and the U.S. a strongly reactionary form of identity politics is gaining strength, in part as a reaction to the cosmopolitan, liberal, and multicultural forms that have been dominant. This is identity politics of a negative kind, defined not by what you are for but what you are against. A narrow majority of my fellow Brits just decided that at the very least, being British means not being European. It was a defensive, narrow, backward-looking attempt to reclaim something that many felt had been lost. But the real losses are yet to come.

Editor's Note: This piece originally appeared in the Wall Street Journal's Washington Wire.