Sunday, February 10, 2019

Brexit: The incompetent, the cowardly and the unprincipled


Almost all of UK politics has been about Brexit.

Yes, it's all been about Brexit and it all still is.  As a believer in free markets and smaller government, I supported Brexit, not so much about ending freedom of movement of people (although there is a strong case to have limits on convicted criminals crossing borders in the EU), but about escaping the high wall of the EU Single Market and Customs Union.  This is where the lazy nonsense from both left and right about Brexit being akin to Trump's success falls rather weak.   For a start, the mandate for Brexit was much greater than the one Trump got.  Trump lost the popular vote, but won the electoral college, whereas Brexit won the popular vote (although the attempt by some to balkanise the UK by saying London voted to "remain" as did Scotland misses the point, it was a UK wide vote on UK foreign policy, which isn't a devolved matter).  Moreover, Trump is a protectionist and an idiot on economics.  Brexit has never been about little Britain or fortress Britain, and virtually none of those who advocated Brexit saw it as the UK turning in on itself, but rather breaking free of the EU to be open to the world.   Indeed, even those who wanted Brexit to enable restrictions on immigration saw it as an opportunity to treat EU citizens on a par with those from the US or India and the like. 

The absolute political abomination around it comes from a whole host of sources which have been undermined by a Prime Minister who neither lack the intellectual nor visceral fortitude to advance in a way that would maximise the interests of the UK and indeed the EU as well.  These include:
  • A loud vocal and substantial number of MPs, mostly Labour, but also some Conservatives (and certainly all Liberal Democrats and nationalist MPs) who want to over turn the referendum result with their banal call for a "People's Vote" (apparently the last referendum wasn't so honoured with such a title).  Virtually everyone calling for a second referendum didn't like the result of the first one, and I doubt any of those calling for it would have supported a second referendum if "Remain" had won.  
  • A deeply divided Conservative Party that doesn't have a clear vision of what it wants from leaving the EU.  It should want maximum market access, it should want control over domestic regulation and regulation of trade with other countries.  However, some want to leave without a deal, some want to leave with a deal that makes leaving conditional on the EU supporting it, and some don't want to leave at all.  The PM wants to leave with a deal that the EU demanded, which some who voted to leave regard as worse than staying in the EU,
  • A deeply divided Labour Party, which ranges from a significant rump who want to remain, a small group who strongly support leaving, and the leadership which isn't keen on committing to anything, primarily because the Trotskyite Jeremy Corbyn has spent most of his life thinking the EU is a capitalist conspiracy for free trade and investment across Europe which interferes with his desire for large scale nationalisation of industry, ending competition in many areas and supporting subsidies for failing industries.
  • A civil service which is oriented towards the status quo, which means not leaving.  David Cameron told the entire civil service not to plan for leaving the EU, so it is lost and trying to work out what it would all mean.  The Foreign Office mind you is in its normal state of affairs, which is not to upset anyone overseas.  It's not at all interested in playing tough with the EU.
The EU has played the UK government like a tune.  It disgracefully raised the issue of the Irish border, despite explicitly statements from both the UK and Irish governments that neither would reinstate a hard border if there were no deal.  Why should they?  The UK does not seek to hinder movement of people or goods from the Republic of Ireland, and the Irish Government has no interest in doing so either (indeed the goods flows across the Irish border are insignificant, being mainly fresh food and road gravel).   What is going on is that the Irish Government, having changed part way through the negotiations on Brexit, to be a minority government with Sinn Fein support, has been seeking to build support by supporting the EU beating up the UK.

This is what is fundamentally problematic with the "deal" Theresa May wants support for.  It includes a "backstop" that would mean a customs border in the Irish Sea that places Northern Ireland within the EU Customs Union.  By no means should the EU (or the UK Government) do anything that essentially undermines the territorial integrity of the UK and the Good Friday Agreement itself as part of the withdrawal agreement.   A stronger PM would just have dismissed this, pointed out how neither side wants a hard border and the UK has no issue with EU goods and people travelling across the Irish border, and leave it to the EU to ask Ireland what it would do in return.   Understandably, the Democratic Unionist Party threatens to bring down the May Government if it persists with this, as it should.  Notwithstanding that the DUP is effectively a "blood and soil" unionist party that is akin to Sinn Fein in Northern Ireland, the whole matter of the future of Northern Ireland should be up to the people who live there.

So it was defeated by the House of Commons early in the year, but since then there have been subsequent votes including the so-called Brady amendment, which called for the PM to negotiate for removal of the Irish backstop.

The EU's response has been "we wont change", but time is ticking, as it is fewer than 50 days away from the UK leaving the EU, without a deal.  What does that mean?
  • The EU stops getting money from the UK (don't underestimate what that means, it is around £173m per week in net terms);
  • The EU can choose to impose its standard tariffs on imports from the UK (under WTO rules, it is the Most Favoured Nation tariffs), and the UK could reciprocate (they would be the same as the UK has EU tariffs at present), or either or both could refrain;
  • The UK no longer has a role with any EU organisations.
It could be highly disruptive to trade, but it is entirely up to both sides.  Hysteria over food shortages and the like is entirely up to the UK to avoid, because it could simply maintain existing trading conditions unilaterally.  However, I would expect the EU to want to impose tariffs or worse (bans or limits on imports), as "punishment" because of its protectionist instincts.  The UK could respond in kind of course, but it would be a trade war started by the EU - which despite the culture war in the UK over Brexit, is not open and not globalist at all.

The EU wants to make it uncomfortable for the UK, it really wants it to be painful to leave its club.  It wants to make an example of the UK, so that others don't want to leave the project.   The majority of EU Member States receive money from the European Commission, so it is unlikely they would leave, but the richer members, such as the Netherlands, Denmark, Sweden and Finland are different.  They are not net recipients, but they are also not beset with the war guilt and fear about fascism that binds Germany (and to a modest extent Italy) to the EU.   However, the UK is still the second largest economy in Europe.  It is entirely in the economic interests of all EU Member States that the UK trades as freely as possible with them, for both goods and services.

On freedom of movement, the UK faces an ongoing dilemma.  There is a lot of support for restricting immigration more generally, but this is primarily due to concerns over housing prices and overcrowding of public services.  There are also concerns about some cultural aspects of migration (particularly high concentrations of Pakistani Muslim migration given the Rotherham scandal), but this is mainly historic in locations where there has been poor assimilation and integration.   Most of those migrants never came from the EU.  Yet when the EU faces a crisis across its members it has proven itself to be inept and incapable of responding.  It was paralysed when European countries (yes the EU is NOT Europe) engaged in a genocidal war in the early 1990s in the Balkans.  It has been paralysed when hundreds of thousands fled the war in Syria (which it, of course, didn't dare want any intervention in).

Leaving the EU does put the UK at risk of one eventuality, a socialist government led by Jeremy Corbyn wouldn't be constrained by EU rules requiring competition in various services, such as energy and transport.  However, leaving the EU will break the UK away from being bound by rules imposed by Brussels and Strasbourg that it cannot escape from.  This is why small authoritarian parties, such as the Greens and the Liberal Democrats are so enamoured by the EU - it imposes legislation (directives!)  that could never be passed by the UK Parliament.   Although it might be argued that the EU Parliament could get more attention, quite simply the EU Parliament does not have the authority to introduce legislation or repeal directives.  The European Council has the sole authority to propose bills to the Parliament, including bills to repeal directives.

Leaving the EU is a liberal venture, it is one that opens the UK to the world, that breaks it out of the sclerotic protectionist trading bloc that isn't interested in tax competition or indeed in allowing the rest of the world to trade using its comparative advantages.   It does not remotely resemble the aggressive protectionism of Trump, and by wanting to put all UK immigration on a similar basis, it doesn't resemble the spectre of xenophobia that many think it does.

However, it has divided the UK like few issues have in recent years.  The various groups are:
  • Continuity Remain: Those who reject the referendum result, reject having a referendum and are viscerally true believers that EU membership is economically, morally and spiritually virtuous.
  • "People's Vote" Remain:  Those who say they support the referendum result, but say everything has changed now, so "the people" should have a chance to reverse it.  None would have called for this had the vote gone the other way.
  • Soft Brexit Remain:  Those who say they want the UK to leave the EU, but stay in the Customs Union (meaning it can't negotiate separate free trade agreements with other countries) and the Single Market (meaning it has to follow Single Market rules for its own market).  Essentially being an EU rule taker without a say on the rules.
  • EFTA Leave:  Those who believe the UK should leave the EU, but simply join the European Free Trade Agreement, which means remaining in the Single Market for trade with the EU, but outside the Customs Union.  Effectively a stepping stone either to remain or to leave in full.
  • May's Deal Leave:  Those who support the PM's deal, which is to leave, but have a backstop so that Northern Ireland remains in the Customs Union if no free trade agreement is agreed with the EU.
  • FTA Leave:  Those who want a much looser deal, negotiating a simple free trade agreement, but leaving the EU in every sense, they are often part of....
  • No-Deal Leave:  Those who just want to leave, unconditionally and THEN negotiate a deal with the EU.
My bet is that the UK will leave, but will negotiate a temporary deal to buy time for further renegotiation.  If it doesn't leave, the Conservative Party will implode and it wont be over.

For me, I'll just be glad when the culture war over Brexit is over.

2 comments:

Lord Egbut Nobacon said...

Probably the most one sided piece on the subject that I have ever read so I will just point out your problem with the Irish Border rather than go through your post bit by bit.

The Good Friday agreement is an international treaty that was signed by three Governments and a dozen political parties and cannot be unilaterally broken by either country.

https://en.m.wikipedia.org/wiki/Good_Friday_Agreement

A no border scenario would leave both the EU and UK open to legal challenges about favoured nation status. To put it simply if a kilo of butter passed across the border without an agreement or a tariff NZ and every country in the world would demand the same treatment.

Te only way out of this conundrum is for Nth Ireland to stay in the customs union and single market (which they voted to do anyway) and put the customs points on the British mainland or Brexit to be canned.

Another referendum?? well you have to read this before anyone comments further.

https://www.theguardian.com/technology/2017/may/07/the-great-british-brexit-robbery-hijacked-democracy

Lord Egbut Nobacon said...

Hope you you get better soon and able to return to work. I know how debilitating some of these flu like diseases can be as you get older.

Cordially yours

Lord Eggie