Brexit: UK Capitulates

A reader was kind enough to ask for a Brexit update. I hadn’t provided one because truth be told, the UK press has gone quiet as the Government knuckled under in the last round of negotiations.

It is a mystery as to why the hard core Brexit faction and the true power brokers, the press barons, have gone quiet after having made such a spectacle of their incompetence and refusal to compromise. Do they not understand what is happening? Has someone done a whip count and realized they didn’t have the votes if they tried forcing a crisis, and that the result would probably be a Labour government, a fate they feared far more than a disorderly Brexit?

As we’ve pointed out repeatedly, the EU has the vastly stronger negotiating position. The UK could stomp and huff and keep demanding its super special cherry picked special cake all it wanted to. That was a fast track to a crash-out Brexit. But it seems out of character for the Glorious Brexit true believers to sober up suddenly.

Some observations:

The transition deal is the much-decried “vassal state“. As we and others pointed out, the only transition arrangement feasible was a standstill with respect to the UK’s legal arrangements with the EU, save at most some comparatively minor concessions on pet issues. The UK will remain subject to the authority of the ECJ. The UK will continue to pay into the EU budget. As we’d predicted, the transition period will go only until the end of 2020.

The UK couldn’t even get a break on the Common Fisheries Policy. :

For [fisherman Tony] Delahunty’s entire career, a lopsided system of quotas has granted up to 84% of the rights to fish some local species, such as English Channel cod, to the French, and left as little as 9% to British boats. Add on a new system that bans fishermen from throwing away unwanted catch and it becomes almost impossible to haul in a net of mixed fish without quickly exhausting more limited quotas of “choke” species such as cod….

Leaving the EU was meant to change all that….Instead, growing numbers of British fishermen feel they have been part of a bait-and-switch exercise – a shiny lure used to help reel in a gullible public. Despite only recently promising full fisheries independence as soon as Brexit day on 29 March 2019, the UK government this week capitulated to Brussels’ demand for it to remain part of the common fisheries system until at least 2021, when a transition phase is due to end. Industry lobbyists fear that further cave-ins are now inevitable in the long run as the EU insists on continued access to British waters as the price of a wider post-Brexit trade deal.

The one place where the UK did get a win of sorts was on citizen’s rights, where the transition deal did not make commitments, much to the consternation of both EU27 and UK nationals. Curiously, the draft approved by the EU27 last week dropped the section that had discussed citizens’ rights. :

Italy’s Minister of Foreign Affairs and International Cooperation, Angelino Alfano, demands EU citizens’ rights be protected after Brexit….

The comments from Italy’s foreign minister come after the draft Brexit agreement struck between Britain and the EU on Monday was missing “Article 32”, which in previous drafts regulated the free movement of British citizens living in Europe after Brexit.

The entire article was missing from the document, which goes straight from Article 31 to Article 33.

MEPs from the Conservatives, Liberal Democrats, Labour, Greens, SNP and Plaid Cymru have written to Brexit Secretary David Davis for clarification about the missing article, while citizens’ group British in Europe said the document failed to provide them with “legal certainty”.

A copy of the letter sent to Mr Davis seen by the Independent said: “As UK MEPs we are deeply worried about what will happen to British citizens living in EU27 member states once we leave the EU.

This issue has apparently been pushed back to the April round of talks. I have not focused on the possible points of contention here. However, bear in mind that EU citizens could sue if they deem the eventual deal to be too unfavorable. Recall that during the 2015 Greece-Troika negotiations, some parties were advocating that Greece leave the Eurozone. A counterargument was that Greek citizens would be able to sue the Greek government for their loss of EU rights.

The UK is backing into having to accept a sea border as the solution for Ireland. As many have pointed out, there’s no other remedy to the various commitments the UK has already made with respect to Ireland, as unpalatable as that solution is to the Unionists and hard core Brexiters. The UK has not put any solutions on the table as the EU keeps working on the “default” option, which was included in the Joint Agreement of December. The DUP sabre-rattled then but was not willing to blow up the negotiations then. It will be even harder for them to derail a deal now when the result would be a chaotic Brexit.

The UK is still trying to escape what appears to be the inevitable outcome. The press of the last 24 hours reports that the UK won’t swallow the “backstop” plan that the EU has been refining, even though . The UK is back to trying to revive one of its barmy ideas that managed to find its way into the Joint Agreement, that of a new super special customs arrangement.

Politico gives an outline below. This is a non-starter simply because the EU will never accept any arrangement where goods can get into the EU without there being full compliance with EU rules, and that includes having them subject to the jurisdiction of the ECJ and the various relevant Brussels supervisory bodies. Without even hearing further details, the UK’s barmy “alignment” notions means that the UK would somehow have a say in these legal and regulatory processes. This cheeky plan would give the UK better rights than any EU27 member. :

The key issues for debate, according to one senior U.K. official, is how the two sides can deliver “full alignment” and what the territorial scope of that commitment will be — the U.K. or Northern Ireland.

The starting point of the U.K.’s position will be that “full alignment” should apply to goods and a limited number of services sectors, one U.K. official said.

On the customs issue, the proposal that Northern Ireland is subsumed into the EU’s customs territory is a non-starter with London…

The alternative would be based on one of the two customs arrangements set out by the government in August last year and reaffirmed by May in her Mansion House speech. They are either a customs partnership — known as the “hybrid” model internally — or the “highly streamlined customs arrangement” known by officials as “max-fac” or maximum facilitation.

The hybrid model would mean the U.K. continuing to police its border as if it were the EU’s customs border, but then tracking imports to apply different tariffs depending on which market they end up in — U.K. or EU. Under this scenario, because Northern Ireland and the Republic of Ireland would share an external EU customs border, as they do now, it would remove the need for checks on the land border between the two.

The complexity and unprecedented nature of this solution has led to accusations from the Brussels side that it amounts to “magical thinking.”

The “max-fac” model is simpler conceptually but would represent a huge logistical effort for U.K. customs authorities. It would involve the use of technological and legal measures such as electronic pre-notification of goods crossing the border and a “trusted trader” status for exporters and importers, to make customs checks as efficient as possible.

While the U.K. will present both customs arrangements as possible ways of solving this aspect of the Irish border problem, one senior official said that the “hybrid” model was emerging as the preferred option in London.

The UK is already having trouble getting its customs IT upgrade done on time, which happens to be right before Brexit. As we wrote early on, even if the new programs are in place, they won’t be able to handle the increased transactions volume resulting from of being outside the EU, and I haven’t seen good figures as to what the impact would be of the UK becoming a third country but having its transition deal in place. In other words, even if the “mac-fac” scheme were acceptable to the EU (unlikely), the UK looks unable to pull off getting the needed infrastructure in place. Even for competent shops, large IT projects have a high failure rate. And customs isn’t looking like a high capability IT player right now.

So the play for the EU is to let the UK continue to flail about and deliver Ireland “solutions” that are dead on arrival because they violate clearly and consistently stated EU red lines. The UK will then in say September be faced with a Brexit deal that is done save Ireland, and it then have to choose between capitulating (it’s hard to come up with any way to improve the optics, but we do have a few months for creative ideas) or plunging into a chaotic Brexit.

The EU27 reaffirmed the EU’s red lines in the most unambiguous language possible. F:

6.The approach outlined below reflects the level of rights and obligations compatible with the positions stated by the UK…

7. In this context, the European Council reiterates in particular that any agreement with the United Kingdom will have to be based on a balance of rights and obligations, and ensure a level playing field. A non-member of the Union, that does not live up to the same obligations as a member, cannot have the same rights and enjoy the same benefits as a member.

The European Council recalls that the four freedoms are indivisible and that there can be no “cherry picking” through participation in the Single Market based on a sector-by-sector approach, which would undermine the integrity and proper functioning of the Single Market.

The European Council further reiterates that the Union will preserve its autonomy as regards its decision-making, which excludes participation of the United Kingdom as a third-country in the Union Institutions and participation in the decision-making of the Union bodies, offices and agencies. The role of the Court of Justice of the European Union will also be fully respected.

8. As regards the core of the economic relationship, the European Council confirms its readiness to initiate work towards a balanced, ambitious and wide-ranging free trade agreement (FTA) insofar as there are sufficient guarantees for a level playing field. This agreement will be finalised and concluded once the UK is no longer a Member State.

The EU also reaffirmed the obvious, “Nothing is agreed until everything is agreed.”

The EU nevertheless has relented in its negotiating tactics. The EU’s initial approach was to put the most contentious issues up front: the exit tab, Ireland, freedom of movement. You will notice it has achieved closure only only one of those issues where the EU’s initial position had been that they had to be concluded before the two sides would discuss “the future relationship,” as in trade. This is the opposite of the approach that professional negotiators use, that of starting with the least contentious issues first to establish a working relationship between both sides and create a sense of momentum, and then tackling the difficult questions later. The EU has now allowed the UK to defer resolving the messy issue of Ireland twice, and it is not clear if any progress has been made on the citizens’ rights matter.

The UK is clearly past the point where it could undo Brexit. There was pretty much no way to back out of Brexit, given the ferocious support for it in the tabloids versus the widespread view that a second referendum that showed that opinion had changed was a political necessity for a reversal. Pundits and politicians were cautious about even voicing the idea.

As we’ve pointed out, coming up with the wording of the referendum question took six months. In the snap elections last year, the Lib Dems set forth the most compact timeline possible for a Brexit referendum redo which presupposed that the phrasing had been settled. That was eight months. And you’d have to have a Parliamentary approval process before and a vote afterwards (Parliament is sovereign; a referendum in and of itself is not sufficient to change course).

Spain has been making noises about Gibraltar but they aren’t likely to mean much. I could be proven wrong, but I don’t see Spain as able to block a Brexit deal. Article 50 says that only a “qualified majority” vote is required to approve a Brexit agreement. Spain as a lone holdout couldn’t keep a deal from being approved. And I don’t see who would join Spain over the issue of Gibraltar. In keeping, Spain joined with the rest of the EU27 in approving the latest set of texts.

The UK still faces high odds of significant dislocations as of Brexit date. All sorts of agreements to which the UK is a party via the EU cease to be operative once the UK become a “third country”. These other countries have every reason to take advantage of the UK’s week and administratively overextended position. Moreover, these countries can’t entertain even discussing interim trade arrangements (new trade deals take years) until they have at least a high concept idea of what the “future relationship” with the EU will look like. Even though it looks likely to be a Canada-type deal, no one wants to waste time negotiating until that is firmed up.

Like it or not, May is the ultimate survivor. :

May has lasted in office longer than many pundits predicted she would because, weak as her grip on power may have been since she lost her parliamentary majority last year, she has timed her surrenders cleverly.

It looks chaotic and undignified, but the prime minister has hunkered down and let pro- and anti-Brexit factions in her party shout the odds in the media day and night, squabble publicly about acceptable terms for a deal, leak against each other and publish Sunday newspaper columns challenging her authority.

Then in the few days before a European summit deadline for the next phase of a deal, she has rammed the only position acceptable to Brussels through her Cabinet and effectively called the hard Brexiteers’ bluff.

But what kind of leader marches her country into at worst an abyss and at best a future of lower prosperity, less clout, and no meaningful increase in autonomy? Like it or not, the UK is a small open economy, and its leaders, drunk on Imperial nostalgia, still can’s stomach the idea that the UK did better by flexing its muscle within the EU that it can ever do solo.

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43 comments

  1. Which is worse - bankers or terrorists

    I’m curious as to the ramifications of the Northern Ireland sea border. Is reunification possible with the ROI, given that the Unionists have been completely castrated?

    I’m a Californian so am not one that is tuned into the history.

    Reply
    1. PlutoniumKun

      Theoretically, there is no fundamental problem with a NI sea border and NI remaining within the UK. Northern Ireland already has its own Assembly and its own laws (the Assembly is suspended at the moment), so it can, if the EU agreed, stay within the EU (albeit without a separate vote or voice at the table). There are precedents for this, such as the . It would be constitutionally messy, but if authorised by Parliament in London and in the EU itself, it would likely be legally watertight so far as I am aware.

      Hardline Unionists oppose this partly because they are ideologically opposed to the EU anyway (although its highly likely many of their constituents don’t agree), but also because they see this as a ‘thin end of the wedge’ leading to a United Ireland. More thoughtful Unionists realise that a sort of ‘foot in both camps’ approach might actually be an economic boon to Northern Ireland – it could attract a lot of investment from companies wishing easy access to both the internal UK market and Europe.

      Reply
        1. PlutoniumKun

          I’m not sure there would be any choice but to enforce it properly, at least in the east to west direction (there would probably be little need for checks going the other way – what EU products will Britain reject?). The consequences for NI agriculture would certainly be catastrophic if it was found that, say, unauthorised South American beef was being imported via Britain. Plenty of people in NI (including many Unionists) are pointing out that NI could well benefit enormously from having a ‘foot in both camps’. There would be little incentive, at least from the NI side of things, to jeopardise this by allowing overt large scale smuggling.

          Reply
    2. PlutoniumKun

      And I’m sure coincidentally, the Civil Servant with responsibility for finding a solution to Brexit and NI has just jumped ship….

      THE TOP UK civil servant tasked with finding a solution to the Irish border issue post-Brexit has quit his job.
      Simon Case is leaving his role to become Prince William’s private secretary, the Guardian is reporting.
      Case served as director general of Northern Ireland and Ireland in the British Department for Exiting the EU for the last three months. He is set to be replaced by his deputy, Brendan Threlfall.

      Reply
  2. vlade

    The most interesting bit on this (apart from the capitulation itself of course), is your penultimate point. Everyone now seems to be saying “ah well, that’s all sorted”. Well, it’s not. A50 still takes hold in a years time, and while the UK-EU relationship may substantially remain the same as it’s now (i.e. no say in anything, but having to accept all the EU says – which is the current one given UK’s out trajectory), the relationships vis a vis third parties will become interesting.

    In how they become interesting matters to the EU as well as the UK, as some of these are not just bilateral UK-whoever treaties, but also treaties affecting the EU. For example, where there are quotas now, what happens? Legally, the same quota will apply to the (say) NZ-EU relationship as before, both for imports and exports.

    But NZ _cannot_ export to the UK anymore, unless EU agrees that any UK imports will count towards EU quotas. It can’t export to the UK, because then it would enter single market, but outside of the quotas. No way that’s gonna happen.
    Similarly, it’s unlikely that where there are any quotas, the UK would get a free pass outside of the EU – unless, again, EU and NZ agreed to count the UK under its quotas.

    In other words, in a lot of situations the UK’s position will depend on both EU and the third party agreeing to a deal – with the UK being more or less just a bystander.

    So all those who expect the ship to sail the same in 13 months time are in for a surprise, unless everyone decides to play nice – and what are the chances of that?

    Reply
    1. Colonel Smithers

      Thank you, Vlade.

      Some, but not all, firms / exporters recognise that, hence greater interest in political risk insurance on the UK (and EU27) at Lloyd’s. Plus greater interest in product liability insurance for exports to the EU27.

      Reply
    2. Clive

      I suspect that was a key consideration for one of the few red lines the U.K. was willing to actually throw its toys out the pram over and risk a hard Brexit and withhold EU budget monies owed over. It got the concession-ette that it can talk to third countries about trade during the transition. I don’t think it was all that much of a victory for the U.K. because it’s only discussions, not the ability to strike a formal agreement.

      And I did always think that the EU was on sticky legal ground insisting that the U.K. (which is a member of the WTO in its own right, albeit deferring to the EU as a WTO block negotiator) could not have at least discussions with third countries once A50 had been concluded in March 2019. This sounded to me like international law overreach.

      You make a very valid point about truly reciprocal new agreements (or replacement agreements) being reliant on the kindness of strangers. However, it’s hard to see why — taking NZ as an example — they wouldn’t be happy (perhaps falling over themselves deliriously so) to strike a quota and tariff free deal which allowed them to increase their exports to the U.K. and that sort of deal would be ready to implement the day after the transition period ends. Perhaps, anyway.

      Reply
      1. vlade

        Of course, NZ (and others) would be happy to do it post the transition phase- the point is more what happens during the transition phase, where NZ might find itself unable to export to the UK at all – unless the EU agrees.

        Because come the transition, the UK will be in a limbo-like state. In EU for the EU purposes, but not in EU for the (at least some) third party purposes. I.e. any EU treaty that covered the UK and did not name it explictly will not cover the UK April 1 2019, not matter what the agreed transition (unless the third party to that agreement agrees too).

        On the ability to negotiate trades/agreements during the transition phase. TBH, it’s even in the EU’s interest – assuming the EU wants a no-crash Brexit.

        That said, the practicality of being able to negotiate a few hundred deals (not just trade ones) in 18 months with staff that still has to negotiate the EU deal is, well, dubious.

        Reply
  3. Colonel Smithers

    Thank you, Yves.

    “The UK press has gone quiet as the Government knuckled under in the last round of negotiations.” The MSM, corporate or government (BBC and Channel 4), are under orders to go quiet. In any case, it’s easier and more fun to cover the anti-semites and anti-transgender whatever in the Labour Party, Trump’s extra-marital goings-on and whatever dastardly plot Putin has come up with.

    On my ‘phone’s news yesterday and today, the Corbyn’s anti-Semitism is not shifting from the top line. The only change is from where the latest article is sourced.

    On the World Service this morning, the BBC reported from the “cultural front line against Putin”. A playwright (perhaps a member of playwrights against Putin) was given half an hour from 5 am to witter on. This is half an hour more than what Brexit will get on the airwaves today.

    How are things playing out locally, Buckinghamshire in my case? The economy is slowing down. More shops are closing. Some IT contractors report contracts not being renewed and having to look for business outside the UK. East Europeans working in farming, care and social services have been replaced in many, but not all, cases by immigrants from south Asia. An cabbie and restaurateur report the worst festive season and first quarter of the year for many, many years.

    At Doncaster races last Saturday, the opening day of the flat season, some bookies were offering odds of Tory victory in 2022, if not an earlier khaki one. It seems that May is a survivor and Corbyn’s Labour has peaked. All very depressing.

    Reply
    1. vidimi

      corbyn has not had a good 2018. if may were to have another snap election soon, she would likely regain her majority, despite the cynicism. of course, once bitten twice shy, and corbyn did not look strong ahead of the last elections either, but now really is the perfect storm: an anti-russia nationalistic frenzy coupled with a scandal over corbyn -liking an anti-capitalist mural that had some anti-semitic tropes years ago.

      Reply
      1. PlutoniumKun

        Thats an interesting point. While the Tories were very badly burned by the snap election last year, they are surely noting that Corbyn hasn’t really made major progress in the polls, and the pressure (mostly press fantasising) is building up on him. They may well be tempted in the event of a parliamentary crisis to go for a snap election with someone new at the helm, and going by the polls, it could succeed.

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  4. PlutoniumKun

    I think the key thing that is driving the politics for the moment is that May has shown an absolute determination to hold on to power at any cost, and she realises that having a transition agreement is central to this. I’ve also been puzzling over the relative acquiescence of the hard Brexiteers – I think they’ve been told by their paymasters that accepting a lousy transitional deal is the key to a ‘clean’ and firm Brexit. I believe the phrase Gove was reported as using was that they should ‘keep their eye on the prize’. I think, as Yves says, the Tory establishment fears a move against May will precipitate a Corbyn government, so they see it as a strategic necessity to keep her in position, and postpone the main Brexit fallout for later.

    Of lesser importance, but also I think a relevant consideration given the strong support given by Merkel, Barnier and Tusk to the Irish PM, Varadkar, is that he is rumoured to be planning a snap election in the autumn. His stance on Brexit has proven popular and he sees the time as ripe to go for an overall majority (he is currently leading a minority government). He is very much an EU establishment favourite, so I don’t doubt that some of the motivation is to help his domestic politics by giving him what are perceived as ‘wins’ over Brexit.

    If this is the case, then barring an unexpected event, I think there will be a strong political push on both sides to sign off a transition deal which would be both a complete surrender by the UK, but with sufficient spin by a supportively dim witted UK press will allow her to push the whole Brexit issue politically to one side for a year or two. The Tories will be hoping that this can be sold to the public as a success for long enough for them to work out how to stop Corbyn.

    Reply
    1. Colonel Smithers

      Thank you and well said, PK.

      Our fellow Papist, one of so many in the Brexiteer ranks (worthy of a thread… :-)), compared the transition to purgatory – and echoed Gove’s comment about the prize.

      Your last sentence is timely. Corbyn’s anti-Semitism is dominating the MSM. The odds offered by the bookies at Doncaster last Saturday suggest that Corbyn has peaked. More of the same smears and diversions from the Tories will be enough by 2022, if not earlier.

      If Lothar Matthaeus is right and England does well in Qatar 2022, the Tories will have a wave to surf.

      Reply
      1. PlutoniumKun

        I can’t believe that ridiculous Corbyn anti-semitism story has such legs. And that the Guardian is piling on as well is particularly depressing.

        Reply
        1. vlade

          TBH, I think this is relatively small beer for most. My feel was that we were post peak-Corbyn even before this, as a large part of Labour voters from the last year were remainers, who now gave up on Labour – primarily due to Labour obsessive celebration of the “victory” (i.e. that they were not annihilated as expected, but still lost) that entirely, and at times aggressively, denied the fact that a lot of remainers voted Labour in a Tory-protest vote (i.e Labour denied their existence, they gave up on Labour).

          They were there for having (and various polls showed that it was a good chunk of Labour vote), but next time, they may just ignore the elections altogether with “pox on both your houses”.

          Reply
    2. ChrisPacific

      It’s been clear for a while now that while there are a lot of hypothetical ways in which Brexit could be done (many of which have been the subject of rhapsodic speculation from various factions) there are really only two realistic options in practice. One is by keeping everything exactly the same as it is now (or as close as possible) and the other is falling over in a heap. Anything else would require the ability to make decisions, plan for the future and implement solutions down to the detail level, including changes to business processes and new/changed IT systems. So far the UK government has proved singularly incapable of doing anything of the kind. Even if that wasn’t true, it’s almost certainly too late to begin now.

      The EU was earlier than the UK to recognize this and consequently has had more or less a free hand in defining the terms of what will inevitably become the only alternative to a hard crash. The UK government was too busy to participate.

      It doesn’t look like this really solves anything except for buying the UK a bit more time. Unless the government suddenly develops an ability to plan and manage change, it could be that chaotic Brexit* will still happen, just a bit later than it would otherwise have done. That’s assuming the transition deal can’t be extended.

      * We need a term for this. How about “Breaks-it?”

      Reply
    3. Tony Wright

      Speaking of the press, what would be Citizen Murdoch’s vested interest in Brexit? Surely, it must go beyond selling a few extra papers by preaching to the converted, i.e. the old grumpies and those who are, or see themselves as, economically disadvantaged by globalisation.
      Experience has taught me that if something appears illogical, look for a hidden vested interest. I wonder what it is with Murdoch? Any ideas?

      Reply
      1. Anonymous2

        Anthony Hilton, the journalist, said he once asked Murdoch why he hated the EU so much. The answer – ‘simple. when I go to Number 10 Downing Street and tell them what to do, they do as they are told; when I go to Brussels they ignore me’.

        So for me Murdoch’s support for Brexit is to strengthen his grip on the UK political system. No more ‘I would love to do that Mr Murdoch, but EU laws prevent me.’ from UK politicians is his plan, I reckon.

        Reply
  5. David

    I’m taking the liberty of re-posting a comment I made yesterday on one of the links – a Richard North piece – to which none of the usual Brexit scholars responded (Sunday ….). It bears very much on this discussion and echoes a number of points made above.
    “Richard North’s Brexit article is well informed as one would expect, but I think that, like a lot of other commentators, he’s missing something. May is a post-modern politician, ie there is no particular link between what she says and does, and her understanding of its impact on the real world. Only her words and actions actually count, and, whether it’s threatening Russia or threatening Brussels, real-world consequences don’t form part of the calculation, insofar as they actually exist. Her only concern (and in this she is indeed post-modernist) is with how she is perceived by voters and the media, and as a consequence whether she can hang onto her job. I think May has decided that she will have an agreement at any cost, no matter if she has to surrender on every single issue, and throw Northern Ireland to the wolves. She wants to be seen as the Prime Minister who got us “out of Europe,” just as Ted Heath got us in. The content of the final deal is secondary: not that she wouldn’t prefer to please the City and the Brexit ultras if she could, but if there’s a choice she will sacrifice them for a picture of her shaking hands with Barnier and waving the Union Jack with the other hand. The resulting chaos can then be blamed on a treacherous Europe. Indeed, if May can stick it out until next year, I think she’ll keep her job. What a thought.” I think many of the hardline Brexiters have the same idea – the political prize is exiting the EU: the damage is a secondary consideration. Any deal, no matter how humiliating, can be spun in the end as a triumph because we will have broken the shackles of Brussels.
    I’d add that the EU’s emphasis on the priority to give to NI was an each-way bet, as I argued at the time. Either the Tory government collapsed, and something more reasonable took its place, or May gave way on everything else, in the hope of surviving and somehow finding a NI solution later. This has indeed proved to be the case.
    Finally, I wouldn’t put too much store by the imperial nostalgia argument, not least because few Brexiters were even alive then. The real nostalgia is for an independent Britain capable of playing a role on the world stage, perhaps at the head of a coalition of likeminded nations. The idea of a Commonwealth Free Trade area, for example, was raised in the 1975 EU referendum debate, and has its ultimate origins in the ideas of Mill and others in the 19th century for a kind of British superstate, incorporating Australia, New Zealand, Canada and perhaps South Africa. Its ghost still walks.
    Finally, let’s not get too carried away with the small size of the British economy. It’s the fifth or sixth largest economy in the world, depending on how you calculate it, ahead of Russia, India, Italy and Spain.

    Reply
    1. PlutoniumKun

      Thanks for that, David.

      I think you are right that the main political priority now in London is preserving May in her position. Whether or not she does a good deal (or any other good policy work) has become irrelevant. Its all about survival, and keeping Corbyn at bay.

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      1. Clive

        Agreed. And the same, by proxy, goes for the DUP too. Yes, they can pull the plug on May. But that’s a high-risk gamble. If they lit the blue touch paper on that firework, they could just as soon find themselves going from a position of holding the balance of power with the Conservatives to standing, gnome-like, on the sidelines with Corbyn’s Labour putting their allegiances to Sinn Fein into practice. Talk about snatching defeat from the jaws of victory.

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        1. PlutoniumKun

          Yes, the DUP have gone suspiciously quiet. I think they realised that they went too far out on a limb and that May could easily call their bluff by pointing out that they can’t afford to let Corbyn in.

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    2. Michael KILLIAN

      Who are the ‘wolves’ to whom NI may be thrown?
      More interesting, who are the strange Tory Brexiteers, not exactly in sync with the needs and expectations of the City of London, big business in Britain, etc? The people for whom an imperial past is still a ghost that walks? A possible answer here:

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      1. makedoanmend

        Yeah, I second the thanks. Waited for this a.m. to read it, and subsequently book marked it. It’s as about a coherent explanation of Tory brexit collective hive thought as I’ve come across – which is to say, brexit isn’t so much a political policy as a ideological approach to moral economy. And I’m sure a few Tories think there’s rich pickings left. Such lambs.

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    3. templar555510

      Thank you David. I agree with your definition of the present Brexit set-up and May herself as post-modernist . The same could be said even more so about Trump . They have in their very different ways taken politics to a place beyond policies and even identities ( it’s most recent iteration ) to this very new place where the public ( translation : American people ) simply roll over and get out of bed the next day to whatever is new and move on whether it be bombing in Syria, or Trump and a prostitute . I think the technology of the smart phone and everything that emanates from it is the handmaiden to this change . The speed of daily life as orchestrated by the smart phone has brought us all , whether we like it or not, to this post-modern , everything is a cultural construct , position which is possibly the most terrifying reality the West has ever had to face and yet it barely registers .

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    4. vlade

      On your last point – it used to be larger. It would have been inconcievable even 50 years ago that the UK’s economy could be compared with Spain’s.

      The point being that the correlation of physical closeness and trade is about as close as you get in economics to a natural law. The UK is now spurning (wilfully limiting its access to) the closest and the richest markets it has. That will have impact – and no amount of Brexiter’s wishful thinking will replace it – if for nothing else, the likelyhood of the UK SMEs suddenly wanting to export to China/India/NZ/whatever is not going to grow with Brexit. Those who wanted and could, already do. The other don’t want and are unlikely to want to in a new world.

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      1. Olivier

        Vlade, 50 years ago Africa still started at the Pyrenées, as the saying was in France. It is not that the UK has shrunk so much as that Spain has dramatically improved its position. So, unhelpful comparison. How the UK fared over those 50 years relative to, say, France and Germany or even Italy, would be more instructive.

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        1. Marlin

          In relation to France it stayed roughly the same. But actually the share of British GDP to world GDP is much smaller and international specialisation and globalisation is much increased. For the question if the UK can act as a “big” economy in relation to economic policy the latter is more important.

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  6. The Rev Kev

    You watch. About the same time that the British wake to find that the elites have sold them down the river through devastating incompetence and sheer bloodymindedness, they will find that in the transition to Brexit that the government would have voted themselves all sorts of laws that will give them authoritarian powers. And then it will be too late.
    It won’t matter how bad May is at that point and she might just resign and let somebody else deal with all the fallout over the new regulations at which time she will be kicked upstairs to the House of Lords. Isn’t the way that it works in practice? Don’t make any preparations, tell the people that they have got it all organized, then when it all hits they start pumping out emergency orders and the like.

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  7. Anonymous2

    It all seems quite curious does it not (curiouser and curiouser?). I wonder if I smell a rat? Forgive me; I have a suspicious nature. I was thinking partly of the role of Gove, which prompted some idle musings.

    Gove is reportedly telling people who support Brexit to keep their eyes on the prize, by which he is said to mean letting the clock run down to 29 March 2019 at which time the UK is officially out of the EU. When I read Gove, I tend to think Murdoch, who pulls Gove’s strings. Yves quite rightly asks what the press barons are about; that is generally worth knowing when it comes to UK politics. Is Murdoch playing a longer game?

    The argument goes that once the UK is out of the EU it will be much harder to get support for it to go back in again as the UK would only be allowed back in without the special privileges it had negotiated for itself over the decades : opt out from Euro, Schengen, various justice issues, the budget rebate. Is this determining Murdoch’s approach at the moment – ensure that the UK is outside the EU at almost any cost before proceeding to the next stage, when Ministers will be largely unable to call Brussels in to help them against him and his allies?

    Why might Murdoch want to do that? There is talk that May will be ditched once she does a deal. If it is seen as a bad deal then she becomes the scapegoat (and Gove steps in to her shoes?). Post March 2019, it might then be the plan to seek to undercut the effect of any deal struck now by, for example, pulling out of the Good Friday Agreement if that proves to be an obstacle to the trade deals Fox is so keen to sign (is he expecting kickbacks?). At that point the UK might declare that with the demise of the GFA it was no longer constrained by the terms of the Withdrawal Agreement with regards to the Irish Border and with one leap the UK would be free. I have seen cynics suggest that the men of violence in Northern Ireland might be encouraged to go on a bit if a spree to justify claims that the GFA had failed.

    I hope I am wrong but as I said I have a suspicious nature and, having watched more of Murdoch’s machinations than I have ever wished, know that he is very capable of playing a long game.

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    1. PlutoniumKun

      I’m loath to indulge in conspiracy theorising, but when it comes to Brexit (and Northern Ireland) conspiracies are legion and real.

      I’m sure in any spiders web Murdoch will be found in the middle of it, and there is certainly something up, thats the only explanation for the low key response of the hard Brexiters. It wouldn’t surprise me if he has realised that a tanking UK economy isn’t exactly good for his investments (its also worth noting that it seems to have belatedly been realised by the UK media economy that many of them will have to up sticks to Europe if they are to keep broadcasting rights).

      My guess is that they ‘have a plan’ which will involve Gove playing middle man, but actually working for a decisive Brexit doing his duty for the country at some stage to step into Mays shoes. All sorts of behind the scenes promises (mostly jobs, no doubt) have probably been made. I suspect a centre piece of it would be a dramatic repudiation of any deal, supposedly on the UK’s terms.

      As for Northern Ireland, anything is possible. Several of the have been shown over the years to be little more than puppets of the security forces, they will do what they are told. And there have long been rumours that at least one of the fringe Republican groups is so completely infiltrated that they are similarly under control. There have been nearly 50 years of shady assassinations and bombings in NI and the Republic which have the fingerprints of intelligence services, so quite literally, I could believe almost anything could happen if it was in their interest. People who c as the centre of a paedophile ring for political purposes are capable of almost anything.

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      1. Clive

        Oh yes, this is a big part of the history of “the troubles”. So much of what went on in that conflict was beneficial to the U.K. government. Budget, manpower, little oversight, draconian powers and a lot more besides was enabled merely because of the paramilitary activities. It’s not hard to look for well documented examples — such as the mass warrantless surveillance of all U.K.- Republic telecommunications by the U.K. security services.

        And virtually everyone in the dissident republican movement was under constant monitoring which was put down to “luck” when schemes were foiled. And even then, there was so much self licking ice creams going on with the RUC effectively knowing about and even setting up IRA hits which were carried out by informants .

        And, there’s more, a lot of provisional activity was just your common or garden organised crime — protection rackets, kidnapping and bribery.

        To say that the troubles were merely to do with republicanism and unionism is like saying US Civil War was only about racism and ignoring the politics and the economics.

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        1. makedoanmend

          And yet the UK had to negotiate a treaty to end the war for all its greater nefarious abilities.

          All the rest is conjecture with a great dollop of post treaty propaganda by a supposed political juggernaut that could not defeat an enemy in its supposed back garden for over 30 years.

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    2. Tony Wright

      Thanks for that -see above post.
      However Citizen Murdoch is fairly ancient and by some accounts bedridden, so I don’t know how long a game he can personally play.
      Also by her own admission some time ago, the latest Mrs Murdoch is no great shakes in the kitchen, which could up his survival hazard if she ever seeks to deputise for the no doubt skilled professionals who usually do the job of catering to their every gastronomic whims.

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      1. Anonymous2

        Where there is death there is hope?

        Murdoch is 87. His mother lived past 100. Speaking personally, I hope to outlive him but am not counting on it.

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  8. David

    I think that we should remember how much the anti-EU fraternity in politics and the media have had a symbiotic, if not downright parasitic, relationship with the EU itself. Much of their commerce depended on us being members, and so being able to strike poses and make cheap cracks about Europe and Brussels. I have a feeling that reality is starting to dawn, and they are standing to understand that politics will be a great deal more complicated, and probably nastier, after Brexit than even it is now.They’ll have to find something else to complain about for easy applause instead of just bashing Brussels.
    As for conspiracy theories, well I have the same skepticism about them of most people who’ve worked in government, and I happen to have been reasonably close to a number of people who had to deal with these issues in the 1970s and 1980s. There was certainly complicity in some cases, and some of the actors involved broke the rules badly , but it’s a stretch from that to talk of conspiracies. With what objective? And what objective would such conspiracies have today, and how could they be implemented? The universal refrain among everyone I knew involved in the security forces at the time was Get Us Out of Here.

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    1. Anonymous2

      To avoid confusion, I was not so much thinking conspiracy as trying to get inside Murdoch’s head.

      What might his objectives be? Well, the first of course is more power and wealth for himself, but he is not above making mischief.

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    2. Clive

      It’ll put a cat amongst the pigeons and no mistake. If I may put in a word from the deplorables who voted Brexit, there’s a lot which — for both the UK and the EU — was made a whole lot easier because a problem issue could simply be labelled as the British complaining and not understanding The Project.

      Take energy. It was probably energy supply as much as Greece and the Ukraine which tipped me over into Brexit. At the behest of the U.K., the European energy industry became, at least in theory, a pan-continental endeavour free from national restrictive practices. Well, a fat lot of good that turned out to be. As exemplified by the recent cold weather snap, UK wholesalers when faced with a shortfall in natural gas supplies spiked the offer price into the stratosphere . No — and I mean no — EU suppliers made any bids. Now, it’s either a Single Market or it isn’t. It either looks and acts like it’s subject to market forces or it doesn’t. The rules are either enforced properly amongst all participants or they aren’t. Irony’s of irony’s, when the U.K. needed an augmented natural gas input to match system demand, the only country to answer their doorbell was Russia. That, and some U.K. big capacity users releasing stocks from storage.

      Now, the smell of the nationalist pulling up the drawbridge in energy supply is causing the Commission to try to document how in fact the Single Market sometimes isn’t a market at all but just a token gesture and is working on the usual eurofudge (the contortions of which did genuinely have me laughing out loud). There’s going to be a lot more of this to come once the U.K. can’t be the donkey this kind of tail is routinely pinned on.

      And it’ll be the same in the U.K. of course. Without the EU ready to play it’s role of perpetual bogeyman, we’ll have no one to blame but ourselves. And I still cannot, in all honesty, say anything other than bring it on.

      (ask me in 5 years if I still think the same..!)

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  9. Ape

    People have avoided the difficulty of reciprocal citizen’s rights. How can the UK reciprocate with all the EU countries? Simultaneously? Where UK non-citizen residents can relocate for 30 years to an EU country then relocate back in the same way that a Brit in France can move to Germany for 30 years and then move back under current rules? It’s even worse if you consider reciprocity to include the rights of all people outside their citizenship country’s right to relocate.

    The only obvious solution is to reduce Brits to the same status of any immigrant to a EU country. That means not being able to shift your permanent residency without applying for immigration.

    Unless you are blue card eligible that’s non-trivial.

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  10. John k

    If this is the mess predicted, and employment falls, blame will fall on Tories and labor will win – best Tories can do is delay to end of term, and maybe not that. We might then see how well MMT does in providing full employment in the hinterlands as Nhs and rail are nationalizes/fixed, regardless of the level of imports… or how well londoners do.

    One link was to the idea conservatives want to blow things up to destroy gov helping hand… funny if Brexit brings the reverse. It will certainly bring the need for gov to replace falling private demand, Tories will man the dikes to prevent that until out of power.

    In the 30’s the big exporter, us, was hit hard. Germany and France, with trade sur with U.K., will likely lose more jobs than U.K… and France can’t spend like U.K. will be able to do. Of course, Germany can do whatever it wants, but spending won’t even occur to them.

    Will pound fall because nobody wants them, or rise because foreign savers that previously funded the deficit can no longer swap stuff for Brit paper?

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  11. Tony Of CA

    May doesn’t have to worry about negotiating wiht the EU. She is busy fighting the Soviet Union under Stalin.

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