Deal or no deal? There’s still no end in sight

And so the pitiful charade continues. To the surprise of no one at all the cross-party talks have died a death. In truth they were stillborn, but it is a recurring feature of Brexit that every development is shrouded in dishonesty, deception, fantasy or, usually, all three.

That applies to almost all the discussions of deal or no-deal. What looks certain to be May’s swansong is typical. She is now going to make a final attempt to get Parliamentary approval for her deal, this time though the back-to-front mechanism of a vote on the Withdrawal Agreement Bill (WAB) rather than another ‘meaningful vote’. In other words, the idea is to approve the domestic legislation to implement the Withdrawal Agreement (WA) before deciding whether to ratify that agreement with the EU. It might best be described as putting the cart before the dead horse.

Indicative votes

Before we even get there, it seems that there is to be a new round of government-initiated indicative votes (IVs). The previous round, initiated by the House of Commons itself, did not yield a consensus and the next version will probably have the same outcome. To an extent, that is to be hoped for, because several of the options – if a leaked document is correct – are, literally, gibberish.

In particular, one option proposes a customs “arrangement” with all the benefits of the customs union but with the freedom to make independent trade deals. About the only sense that can be made of that is if it implies services-only trade deals. If so, the benefits – already tiny, if existent at all – of an independent trade policy are further diminished: free trade agreements have limited purchase in services.

I suspect that this is what is implied because two other options refer to a “comprehensive customs union in goods and services” (so, presumably, this is the difference from the customs arrangement, which only mentions goods). But, alas, the customs union only relates to goods, not services. So voting for those options will be indicative of nothing except MPs not knowing what a customs union means. None of the customs options are anything to do with the WA anyway – they all relate to how the Political Declaration might be changed.

Other options for the IVs are different, relating to process, and here the crucial one may turn out to be on not having a confirmatory referendum. If MPs vote for that option (i.e. because the wording means that voting ‘aye’ to the motion will mean saying ‘no’ to a referendum), it will be a major blow to the remain cause although not a fatal one. A fifth option – voting on the package agreed with Labour – is of course already obsolete since we now know that no such agreement has been reached.

Deal?

With the IVs done, we will then get to the WAB vote in early June. There’s every chance that some MPs will try – and even a small chance that they will succeed – to insert an amendment based upon the erstwhile Brady Amendment or, which is more or less the same thing, the ‘Malthouse Compromise’. This would have the effect of writing into UK law something (i.e. no backstop, or a circumscribed backstop) which directly contradicted what the UK was committed to by international treaty if the Withdrawal Agreement were to be ratified. In those circumstances it’s conceivable that the EU would not even ratify the agreement anyway or, if it did, that there would be an immediate dispute about its meaning.

Supposing, though, that the WAB and the subsequent meaningful vote see May’s deal passed unamended. To hear May, and much of the media, talk you would assume that this would mean that Brexit was done and dusted. It’s reported today (£) that some potential Tory leadership candidates do indeed think that, with the legislation passed, the contest would be all about non-Brexit issues. That is the sheerest fantasy.

The reality is that if May’s deal is done it will only be the beginning of a protracted, complex and highly contentious negotiation with the EU, under the new time pressure imposed by the transition period. It will be conducted against the backdrop of vocal cries of betrayal from Brexiters within and outside of the Tory Party. And very likely it will be under the leadership of a Brexiter PM who regards the deal as odious and will seek to undermine or wriggle out of it.

Indeed, if May’s deal passes, the Tory leadership election is going to be a very strange affair. It seems unlikely that it will be another coronation, so the party membership will have a vote, which seems certain to mean a Brexiter will be chosen. Boris Johnson is generally regarded as the front runner (though I am not convinced this will prove true) but all of them will in those circumstances be unable to run on a ticket of seeking to re-negotiate the backstop. It will have been agreed by Parliament and (presumably) ratified by both the UK government and the EU.

No deal?

Clearly, though, it is far more likely that May’s deal doesn’t pass, or come anywhere close. Then, the situation is going to be enormously complex. First and foremost will be the issue of time. With no deal agreed, the Brexit deadline will be the end of October. The leadership election will take weeks, followed by or running into the summer recess. The winning candidate will almost certainly have been elected on the platform of re-negotiating the WA to remove or truncate the backstop and in the event of that re-negotiation failing leaving with no-deal.

That re-negotiation will fail, without a shadow of a doubt, but it will take up a few more weeks and the October deadline will be closing fast. Does the new PM seek a General Election – possibly requiring an application to the EU for another Article 50 extension to accommodate it - on a no-deal platform that s/he might well lose, and which would anyway provoke a huge split? Just sit and let the time run out with no-deal happening automatically? That would risk MPs finding a way, as they have before although it might not be easy to do so again, of taking over control of proceedings with a view to forcing the government to take another course – conceivably meaning the revocation of the Article 50 notice if that was all there was time for? Or might it mean the insanity of Rees-Mogg’s proposal of the prorogation of parliament in order to prevent this?

All these entail huge difficulties but suppose that, in some way or another, the new Prime Minister manages to get to no-deal. What then? The economic chaos has been widely-trailed. Less obvious, but crucial, is the point made cogently by Alex Dean in Prospect this week: it would not be an end-state, with ‘clean Brexit’ done. It would be the beginning of a new set of very urgent negotiations against a background of serious economic and social dislocation, probably including a further collapse of the pound, and major political crisis.

This is actually the sub-text of all the ‘managed no-deal’ formulations including Farage’s claim that the UK should leave and then immediately open talks on a free trade deal with the EU. But of course many other things apart from trade would need to be agreed. Some of them, such as a bare-bones deal on aviation, would likely be agreed in the interest of, and on terms dictated by, the EU without preconditions. Others, including trade, would entail as a pre-requisite agreement on all the things in the WA (Farage, naturally, still pushes the discredited pre-referendum claim that the EU will come running for a trade deal). That includes, as Liam Fox admitted in an interview this week [time limited download], an agreement about the Irish border.

Makes no sense?

So in any scenario in which Brexit goes ahead we are still, even now, only at the very beginning. May’s deal heralds one new set of negotiations; no-deal heralds a (different) new set of negotiations. But perhaps calling it ‘May’s deal’ is part of the problem, encouraging the myopic focus upon UK domestic politics in general, and May’s personal political fate in particular.

In reality, it is a deal struck between the UK government and the EU. Its form – and certainly the backstop – arises from the red lines which May and her likely successor share. The issue is that Brexiters don’t accept the consequences, imagining them to just reflect May's lack of 'true belief'. So once May has gone nothing really changes (although whether she goes with or without the deal passing will certainly make a difference to what happens next).

Nor will anything change unless or until an honest and realistic discussion of Brexit and what it means begins, of which there is less sign than ever not least because of the re-entry of Farage and the Brexit Party into the fray.

And if none of this makes sense, don’t worry. In fact, congratulations. You’ve understood what is going on.