Friday, 16 October 2020

In for the long haul

A month ago Boris Johnson set a deadline of 15 October for a trade deal with the EU to be done. That date has passed, no deal has as yet been done, but Johnson has not walked away from the negotiations. Perhaps he never intended to and it was just more empty bluster, as in July and September. Perhaps, as some pundits have been reporting, he will do so today when he is due to respond to the European Council meeting. Or perhaps he would like to, but is constrained by the resurgent Covid-19 crisis. Sometimes in politics manufacturing a new crisis can distract attention from an existing one, but it can also simply magnify the sense of a government losing control.

It is clear that the EU will not walk out of the talks and that whilst they continue, fisheries, state aid and the governance of any agreement remain the familiar, widely-reported, stumbling blocks. Of these, the third, governance, has grown in salience because the Internal Market Bill (IMB) has so badly damaged the EU’s trust in the UK (£). But the truth is that this lack of trust has been growing over years, as I catalogued in a post last May, accelerating with Johnson’s cavalier repudiation of much of the Political Declaration.

Lack of trust is now central

The IMB was just the last straw, and - even if the relevant clauses get abandoned, as they still may - its attempt at hardball tactics has badly misfired. For, especially given the new Covid-19 situation, Johnson might want to play the same trick as he did in January and sign up to some kind of deal which he could then try to backtrack on later. If so, the IMB has made that a great deal harder. He has played his tricks so many times that there is no longer any goodwill. Trust and goodwill can sound like airy-fairy concepts in the cold-eyed world of trade negotiations and international relations but they are indispensable, especially in such a complex and unprecedented negotiation as this one.

The fault is not Johnson’s alone. Apart from the back story going back to 2016, trust in the UK is also much damaged by the spectacle of Iain Duncan Smith, and other Brexiters (£), now repeatedly calling for the Withdrawal Agreement to be repudiated. At the same time, there are increasing concerns about the government’s commitment to the rule of law, not just because of the IMB but also the recent attacks from the Home Office on the legal profession, attacks repeated by Johnson in his party conference speech. The backdrop of the illegal prorogation of parliament and the grab of executive power in relation to both Brexit and the COVID-19 pandemic, especially through the extensive use of Statutory Instruments, contributes to these concerns. As David Allen Green, the Financial Times’ Law and Policy commentator, discusses, there is now a question as to whether Britain is moving towards “government by decree”.

Also rumbling away in the background is the long-standing hostility of many parts of the Tory Party – strongly overlapping with those that are the most pro-Brexit – to the Human Rights Act and, even, to the European Convention on Human Rights (ECHR). Indeed it is worth recalling that before the Referendum, Theresa May, whilst campaigning to remain in the EU, proposed that Britain leave the ECHR. Perhaps of more relevance at the present time is Dominic Cummings’ assertion that after Brexit “we’ll be coming for the ECHR”.

No doubt this would find considerable support amongst many leave voters. Throughout the Referendum campaign in conversations and on social media when leavers were asked to give examples of EU laws they disliked these were almost invariably judgments of the European Court of Human Rights (usually garbled versions of these, but that is another matter). Although this is only based on my own experience, I’m pretty sure it was the case more generally. It perhaps doesn’t need to be said here, but the ECHR and its Court are not EU institutions, and Brexit does not affect Britain’s participation in them.

At all events, the Tory 2019 election manifesto promised a review of the Human Rights Act, which translates the ECHR into UK law. This has itself been an issue within the future terms negotiations as it impacts on the EU’s willingness to share security and law enforcement data. Recent reports suggest that the UK has now agreed “not to materially alter” the spirit of the Human Rights Act in order to achieve agreement on such data sharing. Nevertheless, the very fact that Britain’s wholehearted commitment to the ECHR is in question is significant.

A problematic neighbour

So viewed from an EU perspective Britain now looks like a very problematic neighbour. In summary, its government has spoken quite openly of a willingness to flout international law. Influential politicians advocate reneging completely on an international treaty. Its commitment to the domestic rule of law is fraying and that to the ECHR is under debate.

It may well be that much of the noise in these areas comes from some rather cranky and even extreme individuals and thinktanks. But anyone observing British politics over the last few years will have seen how, again and again, ideas which have started there have become mainstream within a short period of time. For example, when in January 2019 Jacob-Rees-Mogg was urging Theresa May to prorogue parliament it was a very niche view. Eight months later, under Johnson and with Rees-Mogg’s connivance, it was attempted and the court ruling of its illegality remains much resented by Brexiters.

Indeed, more generally, one might see the entirety of Brexit as a story of a fringe idea colonising mainstream politics, and thereafter a progressively harder and more extreme version of Brexit become mainstream. So one way of thinking about the situation now is that, having seen Britain signally fail to confine the Brexit Ultras to the margins, and having seen every accommodation made to them by the British polity met with a still harder demand, the EU is now seeking to build a ‘firewall’, in the form of strict governance procedures, between itself and the country the Ultras have captured.

For who knows just how rogue the UK is going to go in the next few years? For that matter, what kind of state will it be if, as seems increasingly likely, Scotland departs and, as is by no means impossible, Northern Ireland also? Even if those things don’t happen – but especially if they do, leaving a mainly English rump – what is the EU to make of a country which, despite having achieved Brexit, still configures its relationship with the EU in wholly antagonistic terms? That may change with the passage of time and political generations, but it’s equally likely to become entrenched and even more bellicose.

The import of all this for the current negotiations is that even if from a British perspective the issue is (perhaps) to get some sort of deal over the line by the start of January so as to at least minimise disruption, from an EU perspective things look different. Not only would the disruption be less for the EU and it is better prepared for it but, more to the point, whatever gets agreed now will have long-term consequences.

Having been repeatedly stung by British perfidy – especially over the Withdrawal Agreement/ Political Declaration - there is a strong incentive to nail down the governance terms of any agreement, and if that is not possible to accept that there will be no deal this year. As Clement Beaune, the French European Affairs Minister said this week, “it’s a matter of how the UK is a partner of trust in the years to come”.

Britain unprepared

If such strategic considerations inform the EU’s approach to these final phases of the negotiations, in the UK it is short-term factors which mainly predominate. I’ve been writing since at least October 2018 about the lack of preparedness of businesses (and other organizations) for Brexit, and in several recent posts about how government information for businesses has come too late and been lacking in key operational detail. Throughout that time there has been a drumbeat of implicit criticism from the government of businesses for being unprepared (and – paradoxically – a veritable orchestra attacking business bodies for their warnings of how much will change).

In recent days, these criticisms have mounted. First, the Business Secretary, Alok Sharma, issued a panicky sounding “urgent message” to businesses to get ready for the end of transition. The next day Cabinet Office minister Lord Agnew accused them of “burying their heads in the sand”, attracting widespread condemnation (£). I’m conscious that I keep repeating that I am repeating myself but as I wrote a few weeks ago these criticisms of business are outrageous given the years of dishonest promises of continued ‘frictionless trade’, the lateness of government planning for the effects of Brexit, and the dismissal of the warnings about both.

Even now, although it is true that some of what is to come will occur with or without a deal, businesses that will face tariffs if there isn’t a deal are left in limbo since, in at least some cases, this is not something they can prepare for as it will simply sound their death knell regardless of any actions they take in advance. Nor are tariffs the only issue. It has long been explained to Brexiters that a ‘Canada-style’ Free Trade Agreement – actually, any Free Trade Agreement – will do relatively little for services trade and, certainly, will offer far less integration than single market membership. But for years they either ignored it, or pretended that a ‘Super-Canada’ deal would be done that would magically avoid this problem. 

The reason why trade agreements do little for services is because, even more than for goods trade, liberalisation requires removing non-tariff barriers. This in turn entails some loss of national regulatory control or, in Brexiter terms, sovereignty. An example of the kind of issue at stake is the mutual recognition of professional qualifications in, for example, law and accountancy, and in fact, despite its recent rhetoric of asking for no more than what Canada has, the UK has been seeking such recognition in the negotiations with the EU.

This seems to have been unsuccessful (though that cannot yet be said definitively) and if so that is unsurprising as it is a version of ‘cakeism’ – that is, wanting to have a benefit of single market membership without being a member. The consequence, as a House of Lords sub-committee reported this week (£), will be very considerable potential damage to the UK’s £225 billion professional services industry. As with sectors like pharmaceuticals, auto, aerospace, chemicals and also some that get less attention (e.g. music, computer gaming, fintech) the UK is ripping up some of its biggest economic success stories – areas where, to use the government’s favourite phrase, Britain is ‘world-beating’ – in the name of the Brexit theology of sovereignty.

Holding all the cards?

Also unsuccessful has been the “UK plea” for special allowances on electric car and battery exports (this would have meant an exemption for this sector from rules of origin which, in general, we already know will be applied). This, remember, is a sector identified by Boris Johnson in 2019 as being one in which the UK plans to emerge as a future world leader. And in the balance are arrangements for air travel at the end of the Transition Period if there is no deal. As things stand, it is not known what will be in place but, in the event of no deal, the Transport Secretary says “we expect the EU to bring forward contingency measures” so that flights can continue. Hardly reassuring for those wanting to plan travel for a time which is now less than eighty days away.

It’s worth noting the tone in both these stories. Whereas the Brexiters promised that Britain would ‘hold all the cards’ once it voted to leave the EU it is now a matter of ‘pleading’ with the EU for special treatment and being entirely dependent upon the EU to keep something as basic as air travel to the continent. That’s not the result of EU ‘bullying’ but the fact, as the air travel case illustrates literally, that if a country disconnects itself from an interconnected world then inevitably it becomes the supplicant when seeking to reconnect itself. Sovereignty doesn’t put planes in the air.

But there is small comfort in the spectacle of all the Brexiter claims being discredited. Between the ravages that Covid-19 is inflicting on businesses and those self-inflicted by Brexit it is becoming increasingly difficult to see what kind of economy Britain is going to be left with this time next year. And that self-inflicted wound isn’t just a result of Brexit, but of the way Brexit has been done and even just of the bone-headed refusal, in the midst of a pandemic, to extend the Transition Period, which would at least have cushioned or delayed much of the damage.

Time is running out but negotiations will never end

Having refused to do so when it was both possible and obviously going to be needed has now exposed the UK to a dire set of risks, for the end of year deadline is one that Johnson cannot now conveniently drop. It is ironic that David Frost is reportedly complaining that (£) the EU is “using the old playbook” of “running down the clock” when it was the UK that ensured that the clock stopped on 31 January. That of course was predicated on the theory that ‘the EU always blinks at the last minute’, a theory now being tested to destruction, with the most recent EU Council statement having a decidedly ‘take it or leave it’ tone.

This exposes the obvious difficulty with the government’s approach which is that it entails the UK being willing to ‘walk away’ without a deal. But apart from all the damage that would do, disproportionately to the UK, the story about contingency measures for air travel in the event of no deal shows the hollowness of the idea. For immediately after having done so Johnson would have to return to the table to agree these and other measures. So if later today, or any other time, he were to announce the end of future terms talks then almost the next day they would resume in a new form.

In several recent posts I’ve argued that it is pointless trying to predict whether or not there will be a deal, and I must confess to becoming increasingly irritated by the numerous pundits trying to do so. But, in addition to that, the wider implication of what I’ve written today is that if there is no deal – and, in a less dramatic way, even if there is a deal – that won’t be a ‘settled’ relationship, and so won’t be the end of ‘Brexit negotiations’. It will be the beginning of more negotiations.

So, depressing as it is to say it, the current ‘deal or no deal’ episode isn’t even the prelude to a resolution. For, given the irreducible fact that the EU is a major economic bloc sitting geographically right next door, there will be never-ending negotiations of one sort or another. Indeed it must be conceded that one, at least, of the Brexiters’ slogans has been proved true. Unsurprisingly so, since it was the truism that ‘we’re leaving the EU but we’re not leaving Europe’.

 

For the first time this year I will be taking a break from blogging next week. It may turn out to be a big week for Brexit news, which would be unfortunate. I hope to post again on Friday 30 October or shortly thereafter. Many thanks to all who read and help to publicise the Blog, which has this week hit the milestone of 4.5 million visits since its launch just over four years ago. I know that there are many other places people can go for Brexit news and analysis, so it is much appreciated and never taken for granted that you come to this site. Maybe this is also a moment to say that I’m sorry I don’t acknowledge every (mainly) kind comment made on Twitter – on ‘blog days’, especially, my notifications tend to go wild. But I do appreciate every one of them. CG

Friday, 9 October 2020

An air of unreality

This will be the shortest post on this blog for some time, since little of note has happened in the last week. The Brexit negotiations continue, albeit in an unofficial and little-reported way and that is not because we have entered the much-vaunted ‘tunnel’ of leak-proof final talks. That may be imminent, as David Frost and Michel Barnier meet in London later today, but unless something has changed behind the scenes it’s difficult to imagine quite what they will say to each other. Last Saturday Boris Johnson and Ursula von der Leyen had a telephone meeting that some thought might produce a breakthrough, but it only led to a call on the negotiators to intensify their efforts.

Yet those efforts have hardly been lacking in their pains, and the reality is that whilst the negotiators have been given incompatible mandates by their political leaders there’s not much more progress to be made. The telephone conversation did not apparently see any change in the political directions being given. In some ways, even at this very late stage, it seems as if no progress has been made since before the Referendum itself. For Johnson is still blathering on about how the key to it all is the UK’s trade deficit with the EU as if he were still touring the country on the bus of lies.

Speculation is pointless

Despite some gloomy-sounding noises from the EU, occasional (though not, it seems to me, concerted) bullish-sounding bellows from the UK, and some optimistic voices in the media (£), I continue to think that there is no way of telling whether a deal will be done, or much point in speculating about it. That will remain the case even if ‘the tunnel’ is entered, because although that would indicate a deal is the more likely outcome it would not make it certain and it would not tell us what kind of deal was being made and with what compromises or by whom.

The reason speculation is so difficult is because, firstly, it’s impossible to know what tactics may lie behind the public statements and media briefings, especially when every optimistic report such as that linked to above is followed a few hours later by a pessimistic one, and vice versa. And secondly (or maybe it is just a version of the same thing), the game theory approach that the UK appears to be following means that we would expect exactly what is happening now whether or not the intention is to strike a deal, so there is nothing sensible to conclude from current events about what that intention is – even assuming Johnson and his shambolic government know what they are intending.

Possibly he still believes that the EU is about to ‘blink’. The signs suggest otherwise, and the relative strengths of the two ‘sides’ mean that there will either be a UK ‘blink’ or no deal. Some reports this week (£) suggest that the former is in prospect, with the UK shifting on state aid and governance issues. Such a blink might be accompanied by some face-saving compromise, with many commentators seeing fisheries as where that might lie, although Tony Connolly, the invariably well-informed Europe Editor of RTE, reports a hardening of the EU’s position on this issue.

Some speculation

My own thought, for what very little it is worth, is that Johnson (though maybe not those around him) thinks not so much that the EU will blink as that it will come up with a solution for him that will make all his problems go away. That isn’t such a strange suggestion because in some ways it has been the UK position all along: to present the EU with the British red lines and sit back. As Brendan Donnelly notes in his most recent Federal Trust blogpost, the EU was puzzled from the beginning by the fact that Britain “seemed incapable of formulating any coherent set of demands or aspirations for the negotiations”.

That was the background to a widely reported story in January 2018 about a private meeting in which Angela Merkel asked Theresa May what she wanted the UK’s relationship with the EU to be. May replied, “make me an offer” to which the German Chancellor pointed out that it was for the leaving country to say what it wanted. May reportedly just kept robotically repeating her “make me an offer” line.

A lot of water has flowed under the bridge since then, of course, but I don’t think it is fanciful to imagine Johnson’s conversation with von der Leyen as having had a similar character. It’s certainly easier to imagine than him engaging in a serious discussion about the nature of state aid regimes or the intricacies of the Northern Ireland Protocol, which he barely seems to understand. Brexit for him, even more than for most Brexiters, has never been about concrete practicalities, which he no doubt regards as the province of “girly swots”. This is consistent with reports this week (£) that Johnson is regarded by EU leaders as “detached” and “absent”. Perhaps, less politely, we could say that he is incompetent, irresponsible and out of his depth.

Be that as it may, if a deal does get done then the Brexit Party – and no doubt many Tory MPs – are gearing up to denounce it. This will be the final chance for Johnson to do what none of his predecessors as Tory leader have done and face down the Ultras. It’s not clear he has the political strength or courage to do so. But if he doesn’t make a deal with the EU then it’s doubtful he has the political strength and courage to cope with the fallout of that. He is approaching the moment at which all his political lies and personal flaws leave him with no place to hide. Tellingly, he barely mentioned Brexit at all in his party conference speech. In line with my speculations above, perhaps he’s just lost interest. Brexit simply isn’t fun anymore.

There’s been so much written about the negotiations and their prospects that, apart from not wanting to add much to it myself, I don’t see much point in chewing over it. The exception this week is a very interesting piece by Matt Ross on the Global Government Forum website. Based on interviews with two former DExEU Permanent Secretaries, it is notable for placing the current negotiating situation in the wider context of the entire Brexit process (something too often ignored, as there are so many patterns, paths and recurrences within it), but also for pointing out that, whatever the intentions of the various actors, there is considerable scope for an accidental no deal. I think, again for what little it is worth, that that is an underpriced scenario.

But the key point, as argued at length in my previous blog, remains that deal or no deal outcomes are just different degrees of bad news for Britain: far worse the EU membership, and far worse than what Brexiters promised. The theatre of the last-minute negotiations shouldn’t distract from that.

Drifting on

The current limbo may very well drift on beyond the October deadlines that both the UK and EU have given, into November or even December, thus compounding the destabilizing uncertainties for individuals and businesses. One piece of good news is that the House of Lords voted strongly for an amendment to the Immigration Bill so as to require the government to provide EU nationals with physical (not just digital) proof of settled status, though it remains to be seen if this will prevail. And good news at least for the big league management consultants, if not for taxpayers, as the extent to which Brexit has driven up what they earn from government contracts was revealed.

So the gloomy roster of Brexit damage continues to grow, and Yorkshire Bylines (whose coverage of Brexit has been excellent) have created a regularly updated list of Brexit-related job losses. This, with dark humour, they call the Digby Jones Index, named after the Brexiter Peer who inanely predicted that “not a single job” would be lost as a result of Brexit. Whilst a bit part player in the Brexit fiasco, Jones is one of the most pugnaciously unpleasant and stubbornly unteachable of the D-list cast so is a deserving target to be thus lampooned – but any amusement is small comfort for those whose jobs are being tossed on the bonfire of the Brexit vanities.

Somewhat beneath the radar, the most ominous development this week was an ECJ ruling that key parts of the UK’s data gathering regime violate EU law. This makes it considerably less likely that the EU will agree to approve the UK system as ‘adequate’ after the end of the Transition Period. This comes on top of a ruling in July about the legality of US data protection and transfer systems, with implications for other third countries such as the UK.

As with so much else about Brexit, this is a hideously complicated legal and technical subject, and it has huge implications for both security and trade, causing extra costs and delays for businesses and potential failures or delays in intelligence-sharing. A decision on adequacy is unlikely to be made until December. As so often, the Institute for Government has an excellent explainer of the issues (although note that it predates this week’s ruling).

Also less prominently reported than it deserved to be was the story that collaborations by UK businesses in the EU’s Horizon 2020 research program have almost halved since the Referendum, although academic collaborations have held up. The amounts of money involved aren’t huge – and actually what matters more is the loss of networks - but like so many of the Brexit stories that don’t make the national news bulletins, what is gradually being eroded are the long-term prospects of activities that are strategically vital to the UK. It’s that, rather than queues developing at Dover or other ports – of which, more news this week - which constitutes the biggest economic danger of Brexit.

Don’t make a fuss

There’s a strange air of unreality in the UK at the moment. Most of the media attention is on the national Covid-19 situation and the rest on Donald Trump. Brexit news is just a rumble in the background. Yet in a mere 12 weeks’ time there will be a fundamental transformation not just in how we relate to the EU but, in some significant ways, to the world as a whole. We still don’t even know the form of that transformation, but we do know that whatever form it takes will affect almost every aspect of daily life for the worse and that neither the government, nor businesses, nor individuals are fully – or in some cases even partially - prepared for it.

It continues to be reported (£) that a third of businesses believe that the Transition Period will be extended so unless that is based on dated survey data then there is an extraordinary complacency around, perhaps born mistakenly of the experience of the various Article 50 extensions. Perhaps also some businesses like many individuals just think all talk of damaging change is ‘Project Fear’, or simply that ‘things always work out somehow’. Or perhaps it’s just Brexit fatigue (allied with Covid worry) and nothing about it really registers any more.

It’s almost a caricature of Britishness, or maybe Englishness, in which we all sit around politely drinking tea and eating cucumber sandwiches and consider it a breach of good manners to mention that the drawing room ceiling has already fallen in and the rest of the house is burning.

Perhaps if a deal is done, no matter how meagre and damaging, the same spirit will persist and we will tell ourselves “mustn’t grumble, it could be worse, better not to make a fuss”. The public reaction to no deal is less likely to be so sanguine, though. It’s perhaps that disjuncture which, ultimately, will inform what Johnson decides is the path least likely to cause him problems and most likely to further his own self-interest. After all, it doesn’t seem unduly lacking in charity to suggest that this might be his sole consideration.

Friday, 2 October 2020

The theatricals of 'deal or no deal' are a distraction

As this supposedly final week of Brexit trade talks ends, the ‘will they, won’t they?’ show continues to play out like an amateur production of an absurdist play or, perhaps more appositely, a Whitehall farce.

At all events, a theatrical metaphor is called for because what we are seeing is a manufactured drama. It is manufactured in the most obvious sense by the fact that the impending end of year time limit, and with that the timescales for agreement and ratification, are entirely down to the UK government’s choice not to seek an extension to the Transition Period. Even more important, the choreography of there being two opposing ‘sides’ going mano a mano until one of them blinks is almost entirely the creation of British Brexiters who have antagonistically constructed the EU as ‘opponents’ to be outwitted in some macho battle of wills.

None of this was necessary. The EU response from the outset has been one of sadness rather than antagonism, and its approach one of dry technical rationality rather than histrionics. It is the Brexiters who have both chosen and needed to make it otherwise, which can be traced right back to 2016 when, far from revelling in their victory, they displayed a sullen suspicion that quickly escalated to bellicosity at the slightest trigger, as with the absurd sabre-rattling over Gibraltar in April 2017. Now, like neighbours from hell with whom all reasonable discussion has been tried, the UK has goaded the EU into starting legal proceedings.

As for who the audience for all this is, that’s a matter of interpretation. Brexiters would claim that it is the EU – to show them that Britain is a ‘sovereign equal’ and will not be pushed around. But of course that is just another line from the play rather than a serious analysis of it. All the signs are that the EU, and the wider world, looks on with bewilderment at the peculiar and undignified conduct of a country formerly seen as rather sensible.

It may, as some think, be the government playing tough for the gallery of the Brexit Ultras as a prelude to letting them down. It may be for leave voters, via the headlines that the government can get in the pro-Brexit press. It may be for the electorate as a whole, softening them up for what is to come – deal or no deal – as being the product of EU intransigence which plucky Britain has fought tooth and nail. Or it may be aimed, again at the whole electorate, as a prelude to a ‘triumphant’ announcement of a ‘great deal’ having been struck at the last minute, much as Johnson did with the Withdrawal Agreement last year.

But even to engage in such speculations is to get sucked into the performance that is being put on, for they are really just another version of the ‘will they, won’t they?’ script. So too are the endless and contradictory predictions of pundits about what the outcome will be, including those who declare that a deal was ‘always inevitable’ and the equal number who declare with equal certainty that no deal was ‘the plan all along’ (whatever happens, half of these are guaranteed their moment of triumph).

Deal or no deal, this isn’t what was promised

What we should be focussing on is that we are approaching the point where all the possible outcomes are hideously etiolated versions of what was promised by Brexiters, let alone of what Britain enjoyed as an EU member. Any deal that is likely to be made, and no deal, and no deal followed (as it probably would be) by some piecemeal deals are all to varying degrees bad outcomes. I’ve argued before (and continue to believe) that a deal of any sort would be the best – or perhaps one should say least-worst – of these available outcomes, but that is all it is.

Thinking just of trade - although that is far from all that matters, as leading security experts pointed out this week (£) -  it is bound to be worse than EU membership. To leave the largest, most integrated, transnational market in the world and the one which is also geographically closest can’t help but be highly damaging, whatever terms on which the UK then trades with it. That’s a truism, but it is worth noting that whenever it is pointed out – as, most recently, by Ursula von der Leyen in January – it is greeted by hardcore Brexiters with paroxysms of fury. So, truism as it may be, it contradicts what some still see as an entitlement.

But what is in prospect isn’t just worse than what we had as members, it’s also far worse than the Brexiters assured us would be the case as a non-member. The words of the Vote Leave campaign documents, repeated with such authority by Michael Gove and others so many times in 2016, should never be forgotten: “there is a free trade zone from Iceland to Turkey to the Russian border and we will be part of it”.

Whether this meant single market membership, as it seemed to imply, and they later reneged on it, or whether they really believed that some other “zone” existed doesn’t matter. It is clear that whatever happens now it will not be this, and it has been for a long time. But, during that long time, they made other promises – of a ‘deep and special partnership’, of a Canada + or even Canada +++ or Super-Canada trade deal. Indeed during the 2019 Election campaign Boris Johnson promised “a super Canada-plus” deal by the end of 2020. All that has disappeared, since the only meaning such terms could have had would have entailed far more extensive integration than the UK is now willing to countenance.

None of this is ancient history. The referendum campaign itself was only four years ago, and voters are entitled to recall that what is happening now flows from, and claims mandate from, the vote. Nor do we have to go back that far, since the groundwork for Johnson’s “super Canada-plus” deal was laid with the Political Declaration (PD) that was part of the ‘oven ready deal’ he was elected on just last December. Yet he immediately repudiated the key elements of that Declaration that would have made a more extensive deal possible, and since then the UK has insisted that it wants no more than a Canada-style deal, with no ‘pluses’ or ‘supers’.

It’s true that even within this there is considerable disingenuity, for two reasons. On the one hand the UK is actually asking for more than ‘Canada’ (e.g. in terms of cabotage rights). On the other hand, the EU has always made it plain, and in the PD the UK accepted but now denies, that any form of trade deal would come with level playing field conditions. But the point holds that all talk of an ambitious deal going well beyond a standard free trade agreement has now been dropped.

One aspect of that is that whereas under the terms of Theresa May’s Withdrawal Agreement (WA) there was the possibility that the trade deal could have had generous terms on ‘rules of origin’, Johnson’s WA removed that option and as a consequence it has just been revealed (though it was not a surprise) that such terms will not be agreed, with significant negative consequences for several industries, including car making. Again, this contradicts what Johnson promised during the election about protecting automotive supply chains.  (Rules of origin are complex but important, see the primer by Alex Stojanovic of the Institute for Government).

It beggars belief that the government should now be contemplating, not as its worst scenario but as its best and indeed preferred scenario, the thinnest of trade arrangements with the EU. It was not entailed by Brexit – even leaving aside the soft ‘Norway’ model, an Association Agreement of the Ukraine type was a possibility, albeit one open to criticism, or some more imaginative hybrid could have been constructed. But Britain has been driven by the implacable extremism of the Brexit Ultras to a situation where the only future relationship options are distance or dislocation.

This is not what was sold to the British people. Nor is it what they currently want, given opinion polls showing that 80% think maintaining a close relationship with the EU is important and that the biggest gap since the Referendum between those thinking leaving is wrong and those thinking it’s right (50% to 39%) has now opened.

Deal or no deal brinkmanship is itself damaging

All this is not just the context for, but is actually more important than, all the excited talk about whether or not – and, if so, when - the negotiators are going to enter ‘the tunnel’ to finalise a trade deal. That matters, but it is the sub-plot to the bigger story and in many ways a distraction from it.

For that matter, the manufactured drama of ‘brinkmanship’ is not just a distraction but itself has serious adverse consequences in terms of the uncertainties facing so many people and industries as a result. For example, for both the UK in general, and Northern Ireland in particular, the present situation calls into question the security of medical supplies, with one Irish MEP saying that “people’s lives are at risk”.

It should be noted that the issues here relate not just to the future terms talks but to the equally important operation of the Joint Committee (JC), charged with implementing the Withdrawal Agreement and Northern Ireland Protocol (NIP), which also met this week. For whilst these are separate processes they have become very much linked in recent weeks as a result of the ongoing row over the Internal Market Bill (IMB). This has created a huge trust problem with the EU over the UK’s willingness to abide by the NIP and work through the JC, rather than to make unilateral decisions that flout the Protocol and thereby, on the government’s own admission, to break international law.

At this week’s JC meeting Gove confirmed the UK was proceeding with the legislation and, contemptibly, the Bill passed its final reading in the House of Commons, with the Tory backbench rebellion fizzling out. Even Theresa May, despite her much-vaunted opposition, did not actually vote against it but abstained. It is a new and shameful low, showing the extent to which all constraints and norms are being jettisoned in the name of Brexit. Unsurprisingly, as it had indicated would happen if the offending clauses were still in play by the end of the month, the EU began legal action. However it has given the UK a month to respond to its initial legal notice (it could have been shorter) and is meanwhile willing to continue trade talks.

The IMB now goes to the House of Lords, where no doubt it will be mauled, but as trailed in my last two posts the government has delayed the timetable for this. Taken together with the terms of the EU’s legal action, this means that there is a tiny window in which the trade talks can proceed without the Bill actually becoming law. That creates a theoretical possibility that the illegal clauses might be dropped in the light of a deal being done, according to Simon Coveney, Ireland’s Minister for Foreign Affairs, and others. Thus by the middle of October, conceivably, there might be a trade deal and an end to the threatened international law breach.

But massive damage to trust has already been done, with the result that the issue of enforcement for the governance mechanism for any trade deal has now taken centre stage in the future terms negotiations. The obvious concern is that the Johnson will once again sign a rushed deal with implementation details to be filled out later, perhaps especially tempting given the ongoing coronavirus crisis, only to backtrack later when it comes to putting what was agreed into practice as has happened with the IMB. Shamefully, thanks to the behaviour of Johnson’s government, our country is no longer trusted to behave honestly.

Deal or no deal, the outlook is unremittingly grim

Meanwhile, all the costs and inconveniences of Brexit, deal or no deal, continue to rack up. Having already lost the European Medicines Agency and the European Banking Authority – inevitably, though Brexiters claimed otherwise (£) – it has now emerged that the UK-based European Centre for Medium Range Weather Forecasts (ECMWF), a key body for climate change research, is all but certain to be ineligible to go on hosting EU funded activities and programs. Month by month, Brexit is already inexorably impoverishing and damaging us, in ways small and large, and which, as in these cases, reach deep into the core strategic strengths and priorities of our country. But as Brendan Donnelly, Director of the Federal Trust, wrote in a hard-hitting blog this week, “the worst is yet to come”, and Simon Nixon in The Times was equally forceful in arguing that “business is about the be thrown under a bus” (£).

As a Select Committee heard this week from leading figures in the aerospace, chemicals, and pharmaceuticals industries – again, all key sectors – trade will become “a day-to-day struggle”, with huge new costs and paperwork, reduced investment and some products being unavailable. Each witness was asked if any reason could be given to welcome the impending end of the transition period. None of them could give one.

Separately, a new report (£) shows that leaving the EU platform for electricity trading will cost hundreds of millions of pounds in increased energy bills. The latest figures on the financial services sector suggest that it has moved 7,500 employees and more than £1.2 trillion (yes, that is trillion) of assets to the EU since the Referendum, with accelerating relocations as the end of transition approaches. And Michael Gove officially confirmed the long-touted figure of £1 billion as the cost of regulatory re-registrations in the chemicals industry. It remains unclear whether the new UK regulatory system will even be ready by the end of the year.

An obvious huge change in January will be the end of Freedom of Movement, which is set to cause serious problems for many sectors of the economy, with a particular and immediate impact on care homes, already in crisis because of coronavirus. And those EU nationals living in the UK with settled status face the nightmare caused by the government’s refusal to provide physical, documentary proof of their status. The digital-only system is unreliable and creates horrendous problems for accessing housing and services, heaping further pain on the already shameful way this group of our neighbours, friends, colleagues and families has been treated since 2016.

The adverse effects in prospect – again, regardless of whether there is a trade deal - will touch every aspect of daily life. The RSPCA is warning of shortages of pet foods and medicines (£) and, although it’s not exactly news, the BBC has produced a listing of things that will change at the end of the transition, mainly focussed on individuals and travel. Unsurprisingly, and in line with the government’s ‘Check, Change, Go’ information campaign, every single thing makes life worse and more difficult. Every single thing.

We are no longer at the point of debates and claims, in which ‘balanced’ coverage supposedly meant pitting a rosily optimistic Brexiter against a ‘Project Fear’ remainer. We are now at the point of news reporting, in which every Brexit story is a bad news story because there aren’t any good news stories.

Nor can this be ascribed to anti-government bias, because if the broadcasters did nothing but read out, North Korea style, every single page of the government’s ‘Check, Change, Go’ website then it would be an unrelenting diet of misery. And this isn’t precautionary stuff for the event of no deal. Everything on that site is bad news – there’s literally nothing that makes life easier or better - it’s just even worse if there were to be no deal. This all comes on top of the COVID-19 crisis but, unlike the virus, is entirely self-inflicted. Britain is doing this – not just Brexit, but the way it is going about Brexit – to itself.

Deal or no deal, the highest price of all?

The previous section summarised only a selection of stories and reports from the last week. Multiple other examples can be found, not least in many previous posts on this blog, all testifying to the terrible price – economic, political, cultural and even moral – of Brexit largely irrespective of a trade deal. The final example is at first sight more trivial. It was reported this week that the Tory MP Esther McVey has accused teachers of left-wing indoctrination of their pupils and more particularly that “white working-class lads” in Brexit-voting areas would be alienated by having “their family’s beliefs” questioned by anti-Brexit teachers.

Everything about this is obnoxious, not least its evidence-free assumptions about teachers’ beliefs and conduct, the homogenization of whole areas, social classes, and ethnicities in terms of their Brexit stance, its faux-egalitarianism - and, even were it all true, why is it only the ‘lads’ who are so delicate? Worse is the grotesque implication that teachers’ political views be monitored. Whilst only a fragment, it forms part of a bigger picture in which being pro-Brexit is being made a condition for appointment to public bodies, or for being rewarded with ennoblement, or is being used to re-shape the civil service – with supposed remainers within it being described by an ‘anonymous Whitehall source’ this week as “the enemy within” who “will be rooted out”.

The noisy barrage of the ‘enemies of the people’ headline is giving way to the quieter but more lethal seeping poison gas of political loyalty tests conducted under cover of populist rhetoric – populist, but not even popular given that support for Brexit is now a minority opinion. Each example in isolation seems trivial, or can be given some justificatory spin, but their accumulation may end up being the highest price of all that Brexit inflicts.

There is a telling line in Sam Byers’ post-Brexit satirical novel, Perfidious Albion: “Brexit was over, but the energy it accumulated had to be retained. Fears needed to be redirected. Hatred had to pivot” (2018, p.119). It seems prophetic in the light of Farage’s new hobby of hanging about grubbily on beaches looking for migrants to denounce. And it conjures up a country – of which the McVey story provides a tiny glimpse – in which the Brexit divide segues into a wider assault upon immigrants and intellectuals, on ‘woke’ culture in schools and universities, on ‘unelected judges’, on civil service neutrality, and on the rule of law (the latter link is to the first of a three-part blog by David Allen Green, so check the follow-on posts for the full argument).

There’s nothing new in the existence of such ideas, but this is the first time that Britain has had a government that subscribes to them. Governments doing so is the script of a story we know well, and it doesn’t have a happy ending.

So as the uncertainty over whether or not there will be a deal continues – and it will for a little while yet – and, for that matter, when that uncertainty ends, it’s important to see it for what it is. Not without any significance, certainly, but a distraction from what is much more significant: the damage, decay and danger of Brexit itself. That drama - of lies told, promises broken, and a country on the brink of calamity - is the etiology of what afflicts us, rather than the tedious theatrics and accompanying breathless predictions which are one of its symptoms.

Updated 04/10/20 to correct misleading phrasing of the story about the ECMWF.

Friday, 25 September 2020

Less than a hundred days left

By recent standards it has been a relatively quiet Brexit week, although also a revealing one in which several chickens have come home to roost as the end of the Transition Period looms ever closer.

The official negotiations resume next week, whilst the ongoing unofficial talks are reported to be progressing “a bit better than expected” according to an EU official. That perhaps means little given how low expectations must have been after the fury in Brussels caused by last week’s events. One cause of that fury – the wholly spurious claim of an EU threat to blockade Northern Ireland’s food supplies, as discussed in my previous post – has been quietly dropped by most politicians for the nonsense it is, although even that was portrayed in the Brexiter press as ‘Barnier caving in’. The damage, of course, is already done.

The IMB fallout

The bigger cause of that fury remains in play, with the passage through Parliament of the Internal Market Bill (IMB), the measures of which include, on the government’s own admission, a knowing breach of international law. However, the rumours I mentioned in my previous post to the effect that the government would seek to slow down the passage of the legislation so as to avoid a confrontation with the EU until after no deal seems inevitable (if that is what happens) seem to be true (£). And if there is a deal the offending clauses may be pulled. Meanwhile, whilst continuing to consider the possibility of taking legal action (£) the EU is holding off doing so for now. The sense is that, for the time being, both sides want to pull back from last week’s row and, as Peter Foster of the FT puts it (£), “a grudging truce has settled back” over the talks.

Nevertheless, the reverberations of Brandon Lewis’s incendiary statement about breaking international law, which is still being defended by the Attorney General, continue to be felt. Some MPs have tried to downplay the significance of what Lewis said but Theresa May, in particular, launched a blistering attack on it during the committee stage this week. For reasons I’ve given elsewhere I do not buy the line that May’s deal was one that should have been supported, and personally I doubt that history will treat her kindly. Much of the current Brexit mess can be laid at her – and her advisers’ - door for the early decisions she made, and for those she did not. Even so, she has recognizable political principles which is a very marked contrast with the corrupt, incompetent and anarchic mess of the current administration.

One indicator of how that administration operates came with the report (£) that Brandon Lewis’s statement was effectively dictated to him by a Downing Street advisor “who gave [him] the words to say”. The advisor, Oliver Lewis (no relation, I assume), is one of several central figures from the Vote Leave campaign – he was its Research Director – who, led by Dominic Cummings, are now installed as special advisers and seem to have been allowed by Johnson to become the de facto government. Many of them are very young, have little or no experience of government and, it’s perhaps fair to say, a greater degree of confidence in their own abilities than a more objective analysis would warrant.

The report stresses that Boris Johnson was barely involved, but perhaps even more shocking is the idea that a member of the Cabinet should, apparently, be taking orders of this sort from an advisor. But it is a measure of the extent to which this under-achieving but over-empowered cadre are able to wreak havoc, whether through abrasive arrogance or plain incompetence. For Brandon Lewis’s words, spoken at the dispatch box of the House of Commons, will leave a long and damaging mark, regardless of the fate of IMB.

Are you ready? Er, no

Oliver Lewis is Johnson’s ‘no deal’ adviser, and is reported to have repeatedly blocked progress in the negotiations with the EU. Whether or not he continues to do so, this week saw the passing of the notable milestone of it being only 100 days until the transition period ends – there are far fewer working days, of course, and fewer still until a deal, if there is to be a deal, has to be finalized for ratification. A new government communication drive marked this moment by asking “are you ready?”.

The answer from numerous business sectors is a resounding no, almost as much so if there is a deal as if there isn’t. The issue here is partly that businesses are overwhelmed by dealing with coronavirus, but the truly shocking thing is the lack of clarity over what they have to prepare for. This was re-affirmed by reports of a meeting at the end of last week between the government and the road haulage industry, which pronounced it “a washout” as the government was unable to provide the details needed of how border systems will operate. As regards business more generally, the British Chambers of Commerce this week published a list showing that no less than 26 out of 35 key questions about a range of post-transition issues remain unanswered.

Road haulage is a crucial industry, so it is a very serious matter that is not likely to be prepared even if there is a deal. This week a leaked letter from Michael Gove suggested that a staggering 70% of EU-bound trucks might not be ready for the new border controls, leading to thousands of lorries facing two-day waits at Dover (in passing, note that almost all the focus seems to be on Dover: much less is said of the significant problems other ports will face).

Subsequently, speaking in parliament, Gove revealed that only a quarter of businesses believe that they are fully ready for the end of the transition period (and that doesn’t necessarily mean they are, by the way), whilst an astonishing 43% believe that the period will be extended. Unless the data were collected before the end of June that is, effectively, an impossibility and perhaps reflects a complacency born of the repeated Article 50 extensions.

But his most remarkable, almost surreal, statement was that, in order to reduce congestion at the ‘short Channel’ ports, there will be a de facto border for trucks entering Kent, which will need special ‘Kent Access Permits’ to be enforced by the police. Who knew that ‘taking control of our borders’ was going to lead not just to erecting a new one in the Irish Sea, but also one around Nigel Farage’s home county?

Separately, it has recently been reported that the development of the new IT systems that will be needed for the UK-EU border is in chaos, and a study published this week by the LSE shows the extent of the disruption to supply chains, especially in the food and drinks industry, that will occur at the end of the transition, again especially if there is no trade deal in place. And a new British Chambers of Commerce survey finds that 52% of UK firms trading internationally have not yet considered the effects of Brexit. But some industries, such as banking, are continuing to shift jobs and operations from the UK to the EU without waiting to see if a deal is done or not.

Whereas the damaging effects of the new border controls will be immediately obvious – queues, supply disruptions and price rises – those of things like banking relocations and their associated impact on tax revenues will be less visible, but no less real.

Incompetence piled on dishonesty …

Since most of the new customs requirements will exist regardless of whether there is a trade deal, the government has been woefully neglectful in leaving the preparations so late. This can be chalked up to general incompetence but there is also a specifically Brexity twist to it. For years talking about the need for such preparations was either dismissed as more Project Fear or made more difficult to admit or be taken seriously because of the ingrained power of the Project Fear narrative. Relatedly, even now there are still  Brexiters, perhaps including some in government, who genuinely believe that there is some form of trade deal which avoids the need for borders, as if it were possible to have  “the exact same benefits” as single market and customs union membership.

After all, it was not until February 2020 that the Border Delivery Group was established (as an aside, later, its leadership appeared to be a casualty of the witch hunt for supposedly ‘remainer’ civil servants), and although that was not the beginning of the government’s border preparation work it was the first point at which it was officially acknowledged that ‘frictionless’ trade post-Brexit was impossible.  

It is worth pausing to reflect on the almost unbelievable dishonesty of this. Even soft ‘Norway style’ Brexit would have had some implications for border friction, but from the moment in January 2017 when hard Brexit became confirmed as the official position any possibility of anything like ‘frictionless’ trade disappeared. No free trade agreement could prevent that. Many experts on trade and customs, many business groups, and many commentators including relative minnows like me were screaming this. Yet it was three whole years before the government officially accepted that this was so, and even then it was not until July 2020 that it published its ‘Border Operating Model’, less than six months before it needs to come into force.

We already know that one of the government’s responses to the border chaos which on Gove’s admission now seems inevitable will be to blame businesses for lack of preparations, which is outrageous considering that the government still can’t give precise details of what they need to do. But we also glimpsed another of the ways the government will respond because it was pre-figured by DEFRA Secretary George Eustice in Select Committee evidence this week: blaming it on the “failure of the EU to plan”. It’s a charge as predictable as it is ludicrous (see the various reports in the Twitter thread link).

Such responses are at one level just boilerplate political blame deflection but, more profoundly, exemplifies the refusal of Brexiters like Eustice ever to take responsibility for the consequences of their actions. For that reason alone, it’s important to keep recording and reminding people of the promises that were made for, and the lies told about, Brexit.

The consequences of no deal would of course be that much greater – as set out in an excellent, comprehensive report this week from the UK in a Changing Europe thinktank, covering not just trade but implications for transport, data, citizens, Northern Ireland, and security amongst other things. One issue not mentioned, but in the news again this week (£), is the ongoing saga of Galileo, the EU’s GPS satellite navigation system, with the announcement that the UK has abandoned attempts to build its own alternative system and the suggestion at least that the UK might try to rejoin Galileo.

This is a convoluted story, going back to 2018 when Theresa May pulled out of talks with the EU because of its insistence that the UK could have only limited, third country access to the system and announced that the UK would build its own version (although some experts thought that a compromise deal was possible) at an estimated cost of £5 billion.

That idea was enthusiastically taken up by Johnson (and reportedly driven by, again, Cummings against, or without, expert advice) who decided to buy a bankrupt satellite firm, OneWeb, to deliver it. But in June this year substantial problems emerged (the whole sorry story to that date is well told by Alex Andreou in Byline Times) and the idea has now been dropped. It is unclear at this point what will happen, but the impacts for businesses and for defence are massive. Again, there is less than 100 days to sort this out, but that timescale is a luxury compared with that faced by some UK citizens living in the EU who are customers of those banks which this week announced their accounts would be closed – in some cases before the end of the year.

Piled on even more incompetence

It is becoming clearer by the day, especially in the light of the predictable resurgence of coronavirus, that Johnson’s refusal to extend the Transition Period when he had the chance was a major and possibly catastrophic error of judgment. Far from putting pressure on the EU to ‘blink at the last minute’, it has left Britain woefully unready to cope even if there is a deal. As with the inevitability of an end to frictionless trade, the government was warned over and over again by business bodies and others that this would be the case but chose to ignore them.

Whilst far smaller in magnitude, I think it was also an error of judgment for Keir Starmer not to have at least placed on the record at the time that this was a huge mistake. Even now, in his first conference speech as leader, he said very little about Brexit and did not mention the failure to extend transition at all. I understand perfectly that he needs to avoid being depicted as a ‘remainer’, as Johnson wishes to do. But in taking the line that it is for Johnson to deliver the deal he promised, there is room to make reference to his unilateral decision to compress the time available to reach such a deal, if only as a marker for the future. It would sit well within his more general positioning of Johnson as operationally incompetent.

That critique now has real purchase, to the extent of becoming the dominant narrative, because of the way it is being taken up by so many Conservatives and former allies and supporters of the Prime Minister. Just in the last week or so it seems as if a switch has been flicked in this respect, in a way that is remarkable considering he won a majority of eighty less than a year ago. Coronavirus is of course the main driver of that, but I think that the reverberations of the IMB and the ‘breaking international law’ debacle has played its own, not insignificant, role.

On the one hand, it has created a breach between Johnson and some of the hard core Brexiters like Michael Howard. On the other, it has opened up the entire question of competence in a new way for, as Theresa May pointedly asked, “if the consequences of the Withdrawal Agreement were so bad, why did the government sign it”? This in turn links back not just to Johnson but to the arrogance and hubris of his Downing Street operation, for increasingly there are reports (£) of the resentment that experienced MPs and ministers (and, I would assume, senior civil servants) feel about the transparent contempt with which they are treated by the Vote Leave wunderkinds. Bad enough to be subjected to that indignity by those who are competent; intolerable when it comes from those who are serial bunglers.

So, deal or no deal?

All that may well turn out to be bad news for Johnson’s premiership, but it’s not at all clear what it means for the prospects of a trade deal with the EU. That can be argued in two diametrically opposite ways. One is that, stung by the criticism of his failings, making a deal becomes Johnson’s priority so that at least he can claim to have ‘delivered Brexit’, his central policy, in defiance of the ‘doomsters and gloomsters’. The other is that he pushes the button on his no deal threat in order to gain the adulation of the Brexit Ultras and stoke up the populist culture war he thrives on, and once again ignores all of the warnings of just what a disaster that would cause.

Both have very clear risks. Even the thinnest of deals will enrage the Ultras, whilst not avoiding a level of disruption that compounds the narrative of his incompetence. A thicker deal might be a little less disruptive, but enrage them even more. But no deal would be a gift to Labour and, whilst it might appeal to his core vote, the disruption, would, especially on top of the coronavirus suffering, be deeply unpopular. In particular, there is strong polling evidence of how unpopular no deal would be in the ‘Red Wall’ seats.

I’m assuming, of course, that Johnson’s calculation will be based solely upon his own self-interest and advantage, but that’s not an audaciously unrealistic assumption. Where it will lead him, I have no idea and I’ve seen nothing in any of the UK or EU commentary that suggests that anyone else has either. There is certainly no consensus view.

A straw in the wind may be the fairly upbeat report from James Forsyth in The Times this morning (£), because recently his speculations have had an uncanny knack of proving right, suggesting that he has well-informed sources. But it is perfectly possible – even likely - that Johnson himself doesn’t yet know what he intends. In any case, it should never be forgotten that, as Neale Richmond, the Irish politician who has played a leading role in shaping his country’s response to Brexit, pointedly remarked this week, the negotiations are not an internal Westminster debate, despite what the reporting of some parts of the UK media might suggest.

What is clear, for reasons I’ve argued before, and as trade expert David Henig has argued cogently this week, is that from a UK ‘national interest’ perspective a deal is important. As he says, it’s not that a deal will avoid all the disruption – there will still be plenty of that – but that it would at least begin to re-normalise UK-EU relations. I believe this would also be generally welcomed by the EU.

This is really the next big challenge for the UK, and one which erstwhile remainers can and should try to influence. Sir Simon Fraser, former Permanent Secretary at the Foreign Office, has recently set out the many challenges for post-Brexit foreign policy. They are considerable, because of the strategic incoherence of Brexit. But a key part of meeting them has to be to move UK-EU relations away from the entirely antagonistic framing that Brexiters give them, even after having left. That will be hard enough, but without a deal – even a very limited one – to build on it will be made impossible for years to come.

Clearly that hope is precisely why the scorched earth Brexiters want there to be no deal. For the rest of us it is important they don’t get their way. They have had their Brexit – and what a colossal mess they are making of it – but that does not give them licence to permanently poison our relationship with our closest friends.

Friday, 18 September 2020

Blockades, mythical and metaphorical

The Internal Market Bill (IMB) and its repercussions have been the predominant theme of this week’s developments. Almost as soon as I wrote my previous post, Brexiter MPs started justifying that Bill in terms of the supposed EU threat to ‘blockade’ food supplies travelling from Great Britain (GB) to Northern Ireland (NI). In particular, it was this threat which was used to justify the incendiary step of including the clauses in this legislation which would break international law. This justification has now been widely repeated, including by the Prime Minister.

This was a dishonest linkage to make, because there is nothing in the IMB which would prevent this mythical ‘blockade’ (though there are rumours that the forthcoming Finance Bill will do so). The two areas in which the Bill proposes powers to defy international law are – as detailed in the previous post – goods flows from NI to GB and  the state aid rules in the NI Protocol (NIP). This point was made in a very effective parliamentary performance from Ed Miliband during the IMB second reading debate this week, in which he challenged Boris Johnson to explain his claim – which, unsurprisingly, as it would have been impossible, the Prime Minister refused to do.

The myth of the ‘blockade’ threat

As so often in the Brexit saga, disentangling the different strands of what is being said and why is complex. The first time a linkage between the IMB and the ‘blockade’ threat was suggested seems to have been in a report in The Sun on Tuesday of last week, where it was said that Michel Barnier had made “veiled threats” about GB to NI food flows during the trade negotiations and that it was these which had provoked the government to its move against the NIP (quite how the timings of this would have worked is unclear, by the way).

The story was given legs by a reference in Barnier’s statement at the end of last week’s talks when he said that “more clarity is needed [about GB’s proposed future sanitary and phytosanitary regime] for the EU to do the assessment for the third-country listing of the UK”. Such listing will be needed for GB agricultural produce to enter NI at the end of the transition. The UK position – as articulated by David Frost - is that this is a non-issue as GB will continue to follow EU standards, and if it proposes to change these will give the EU and the WTO plenty of notice.

Whether this issue is being used as negotiating leverage in the trade talks or not I don’t know. But it certainly doesn’t amount to the threat of a ‘blockade’ with its connotations of naval interdiction. Rather, it is a reminder of the procedural, rules-based nature of the EU as an institution and, for that matter, of international trade. It is not enough for the UK just to say it will follow the EU’s Sanitary and Phytosanitary (SPS) standards and, as Boris Johnson asserted at this week’s liaison committee, that the EU should automatically list the UK with its failure to do so meaning it is not acting in good faith. Rather, like any third country, which is what the UK has chosen to be, it needs to submit the relevant documentation for assessment.

If it is compliant, then the EU would have no grounds to refuse third country listing, and there is no suggestion that it would do so. Even if it did, the UK’s correct response would be to seek redress through the WA dispute system (and, perhaps - I am not sure - through the WTO) and in the meantime to make use of the existing provision within the NIP whereby “serious economic … difficulties” can be addressed by unilateral action, thus avoiding any ‘blockade’.

In short, there’s no reason to think that the EU is minded to punish the UK in this way, even if it was it couldn’t, even if it could the UK has no need to break international law to respond to it, and even if it did need to the IMB doesn’t provide the means.

My guess is that the UK has not wanted to submit its SPS plans because of the likely contradictions between following EU SPS rules and making trade deals with other countries, especially the US (although it is reported that the government now says it will do so by the end of October). For the EU’s part, there is presumably a reluctance just to take it on trust that the UK will comply and will give adequate notice of any changes. Similarly, it is reluctant to take on trust that the UK’s post-Brexit State Aid regime will be robust and wants to see the precise detail before agreeing a trade deal.

Such a lack of trust is the inevitable consequence of the bellicose, negative and sometimes duplicitous way that the UK has approached the Brexit negotiations over the last four years. Doing so has consequences, and those consequences have caught up with Britain. They can only be compounded by the current threat to break international law, so if that threat was indeed meant as a counter to Barnier’s position about third country listing then it is counter-productive anyway.

The wider attack line

However, the initial reporting was not the same as what came to be said, in that it only suggested the IMB clauses were being used to ‘talk tough’ in reply to the EU’s ‘threats’. It was not until a few days later that it began to be falsely claimed that the Bill was actually a way of neutering those threats.

The obvious reason is that the ‘blockade’ line offers, to Brexit supporters in the population and the media, something that sounds sufficiently serious to justify the breaking of international law. Perhaps it was developed in part because of the backlash against that plan. However, it is only one strand within a wider and much more dangerous narrative that the Brexiters are developing. For the ‘blockade’ allegation is part of a thoroughgoing attempt to claim that the EU are not negotiating in ‘good faith’. As noted above, the Prime Minister himself explicitly linked third country SPS listing with good faith this week.  But the wider attack is that not just for this reason but more generally it is the EU and not the UK which is in breach of the Withdrawal Agreement (WA) and, therefore, of international law.

It takes quite some brass neck – actually, it takes a sociopathic lack of self-awareness and pathological dishonesty - to make such a claim, but none of these qualities are alien to the Brexit Ultras. As usual (cf. GATT Article XXIV) they seize like barrack-room lawyers everywhere on some half-understood (if that) legal text to give themselves a veneer of authority with which to impress the gullible. Currently, it is Article 184 of the WA (see p.287 of link) according to a semi-literate briefing produced by the ERG (described by law Professor Steve Peers as “perhaps the worst legal analysis I have ever seen, and I am including students who leave their exam booklet blank”).

This article requires both sides to negotiate in good faith and to use their best endeavours to secure agreements on the future relationship. Risibly, the Brexiters interpret this to mean that if the EU doesn’t give the UK a deal that it wants then that violates the article and means the EU is not acting in good faith. They also conveniently ignore that Article 184 refers to the agreements to be sought as those referred to in the Political Declaration – the very document which, with its references to level playing field conditions, they and the Brexit government have disowned. Even in its own terms it’s nonsense since if, as claimed, the EU is in breach of the WA then, as with the ‘blockade’ non-issue, the remedy is to use the dispute resolution procedure within the WA rather than unilaterally to break its terms.

Never mind. Like so many other bogus Brexiter claims this one – along with other equally footling ideas such as that the NI Protocol was only designed to be temporary – are now being pumped out by any and every Brexiter MP and their social media foot soldiers. So too is the Brexiters’ idea that since the Miller case (which forced the parliamentary vote on triggering Article 50) confirmed the primacy of parliamentary sovereignty over the Executive then ‘therefore’ this means parliament doesn’t have to obey international law. It’s hard to be too scathing of the woeful intellectual inadequacy and dishonesty of such gibberish.

The motivation here is obvious. Even in these post-truth times it strains public credulity that a government that signed a deal six months ago can now claim it is deeply flawed. Admittedly Bernard Jenkin now openly says that “the UK made a mistake in signing the WA” – something he and the rest of the ERG voted to do - but if that becomes the Brexiter message then it suggests that the entire basis on which the Tories campaigned and won the General Election was also a mistake. It might even invite the heretical thought that if MPs can change their minds about what they voted for then so too could the electorate that voted for Brexit.

So, instead, the blame is being ascribed to the EU for bad faith and for making ‘extreme’ interpretations of the WA. This, rather than Brexiter delusion or duplicity, is then used to justify reneging on parts of it or in due course – as I have been suggesting for some time is the Ultras’ hope – on its entirety.

The IMB at home and abroad

For the time being that only extends to the provisions of the IMB, assuming it passes. This is now likely because it seems the government has conceded to its ‘rebels’ that the provisions which would break international law can only be activated with a further parliamentary vote (and with some other new caveats). It is only a fig leaf, with little substantive meaning, although it does show that there are still lines – even if only shakily drawn in the sand – that Johnson isn’t quite able to cross.

But as so often in the Brexit process – the Chequers Proposal and the ‘Malthouse Compromise’ come to mind – attempts to broker domestic agreement, even if successful, myopically ignore international consequences. In particular, the existence of this legislation even in very slightly softened form is anathema to the EU.

There seems to be some dispute as to whether simply passing (or even just proposing) such a law would, in itself, be grounds for the EU to take legal action, or whether that would require the powers granted to be exercised. It is also a political question as to whether the EU would do so even if legally able, to which the answer seems to be ‘not yet’. Either way, assuming the relevant clauses pass in any form the damage will have been done to the last residue of the EU’s trust. The EU won’t walk away from the trade talks, and a deal is still possible, but the inviolability of the WA as a condition for such a deal has been forcibly reaffirmed. And it will taint the UK’s international reputation as Ursula von der Leyen has warned (£), with potential effects going far beyond Brexit.

Already this week we have seen signs of that, with robust statements from Joe Biden and other US politicians re-confirming that a UK-US trade deal is unthinkable if the Good Friday Agreement is compromised. Breaching the Northern Ireland Protocol (NIP) in the ways proposed by the IMB doesn’t in itself necessarily do that, but it could be a move in that direction.

Indeed Dominic Raab’s visit to the US, which occasioned these statements, showed how this could be. For in defending the IMB he made the extraordinary comment that it was only necessary because the EU was trying to erect a regulatory border down the Irish Sea. Yet that it is precisely what the UK has agreed to. So if Raab actually understood and meant what he said – an open question, since he appears to be totally out of his depth - then the entire basis of the provisions in the NIP which prevent a land border with Ireland, and therefore the GFA, would be compromised.

Brexiter MPs reacted with fury to Biden’s intervention but, like it or not, as a consequence of Brexit Britain has, as it were, blockaded itself into isolation, and can be booted around by the big players whether that be the US, EU or China. Arch-Brexiter John Redwood may blithely opine that “trade deals are nice to have but not essential … Getting back full control of our money, our laws and our borders is essential”, but that always hollow slogan now sounds increasingly like the last desperate cry of a country sinking into oblivion. Not waving, but drowning.

Domestically, the IMB may initially have looked smart. The Tories could depict Labour’s opposition to the Bill as “siding with the EU”, and many voters will surely take the view that breaking international law isn’t ‘really’ breaking the law. And as one said on a vox pop on Radio 4 this week ‘it’s not as if we’ll be torturing people’. Plus for many Tory core voters almost anything that seems to further the Brexit cause, or even just sticks fingers up at the EU, or even just enrages the liberal metropolitan elite, will be greeted with rapture.

Yet those voters – and more importantly the Brexit Ultras – may be infuriated at having been marched up the hill of flouting the WA only to be marched half-way back down again when Johnson encountered some opposition. There are also rumours that the legislation may now be delayed, despite the initial claim that it was so urgent it had to be rammed through quickly, which would be a further climbdown.

So the IMB is beginning to look like yet another Johnson fiasco. He has raised the Ultras’ hopes of ditching the WA – or at least of ‘sticking one’ on the EU - then backtracked. Yet the damage to relations with the EU and to the UK’s wider reputation is done anyway, and won’t be forgotten for a very long time. In this respect, too, he seems to have blockaded himself into a corner.

The underlying problem: trying to turn lies into policy

Aside from their immediate motivations and effects, these latest events re-emphasise something more fundamental about Brexit. It has always been based upon a denial of, or at best a naivety about, reality. In particular, as Tom McTague wrote in The Atlantic this week, a denial of the reality of the meaning of Brexit for Northern Ireland (or of Northern Ireland for Brexit). Consider the absurd dismissal of this reality by Boris Johnson and others in 2016, insisting that Brexit would have no impact on the Irish border because of – again, invoking a bit of legal-sounding mumbo-jumbo – the longstanding existence of a Common Travel Area. But there has to be a border somewhere. Having for reasons of expedience accepted that it would be across the Irish Sea, Johnson is now trying yet again to deny the need for a border.

Brexit wasn’t just a denial of the reality of Northern Ireland but also of the nature of the single market, the nature of the EU, and much else besides. Looking at the Vote Leave campaign documents now, there is scarcely a sentence in them that anyone could now seriously defend. The line in the final page summary about “having better relations with our European friends” has a particularly hollow ring to it this week, whilst the core economic claim that “there is a free trade zone from Iceland to Turkey to the Russian border and we will be part of it”, always a lie, now looks like the ravings of a lunatic.

As I wrote in March 2019, you can lie but you can’t turn lies into policy. The attempt to do so is the reason the UK is being driven to more and more extreme positions. It is that which has given the events of the last few years their strangely repetitive quality as, like moths dashing themselves against a window pane, the Brexiters keep trying to buck reality. A small example of that came this week when Geoffrey Cox refused to support the IMB on the basis that it broke international law by unilaterally over-riding the WA. Cox – himself a Brexiter, demonstrating that they are not all Ultras – had also as the then Attorney-General refused in the face great pressure to advise that the government could legally unilaterally exit what was then the backstop in May’s WA. That was eighteen months ago, but the Ultras are still convinced there is a way around having to honour what you agree to.

What we see in the government’s present contortions over the IMB is, as Rafael Behr wrote with customary insight this week, “the dawning, desperate realisation that there is no way to reconcile responsible statecraft with the fulfilment of Eurosceptic fantasy”. But the realisation, if that is what it is, has come too late. The UK government and Eurosceptic (or Brexiter) fantasy are now inseparable and – in their aims to reshape the civil service and judiciary – they threaten also to capture the institutions of the state.

Of course, for those who have the true faith, it is neither fantasy nor lies, and no event or experience can shake them into accepting reality. Some, at least, still genuinely believe that there is some kind of trade agreement that can largely replicate single market membership without any of the obligations. They still believe that either now or after a few months without a deal the EU will make such an agreement, no doubt at the behest of German car makers. They still believe that it doesn’t matter much anyway, as ‘WTO terms’ will be just fine. They still believe that the Irish border issue is one confected by Brussels and perhaps Dublin. The real blockade is of their brains: fanatical Brexiter ideology prevents the entry of reality.

What now?

Their fantasy will, as it always has done, seek to drive Brexit policy in a harder and harder direction. It is the only way of outflanking encroaching reality – if we push harder our dreams will come true, and if they don’t come true it is because we aren’t pushing hard enough - and is also the only way of sustaining the populist culture war that secures them the votes they need. Derogation from the European Convention of Human Rights is the already emerging next step, perhaps after a no (trade) deal Brexit and, if so, the subsequent ripping up of the WA in its entirety. For there is surely no way that either the financial settlement or the NI provisions would survive Brexiter pressure in the absence of a trade deal (though one must pray that those for citizens’ rights would).

That seems a perfectly feasible short-term scenario, and at the beginning of this week might have seemed the most likely. Certainly Sir Ivan Rogers, who has been right about most things to do with Brexit, believes that that there will be no deal.  But in this febrile atmosphere, and with a Prime Minister so lacking in consistency, principle, or even basic competence, Brexit predictions are more difficult than ever. So as the week ends it still looks possible that after all the chaos of this autumn (of which there is much more to come) clears away, some kind of fairly limited deal will be done. At least, there are a few straws in the wind – as regards both fisheries and even state aid – that this might be so.

If so, the economic consequences will be bad but not dramatic and not very visible, just a gradual decline of prosperity. Relations with the EU will be sour but not totally destroyed. Resentfully the UK will comply with the Irish Sea border, and the complex, rickety mechanisms for doing so may just about work. There will be years of ongoing negotiations on a piecemeal basis, and constant attempts by the UK to push to the limit and beyond what it had agreed. The Brexiters will be sulphurous and constantly urging more antagonistic stances, and still convinced that their fantasy would have been possible had it not been betrayed.

It’s hardly an inspiring vision, yet, limited though it is, an optimistic one which in another week may seem hopelessly unrealistic. For there are many obstacles to reaching even this very modest destination. Brexit has blockaded Britain from any more convivial one.