Tuesday 29 January 2019

Brexit: bewilderment, dismay and shame

It’s difficult to feel anything other than bewilderment and dismay at the events unfolding in Britain. My comment at the beginning of my previous post that this week would see some of the dust clear proved somewhat wide of the mark.

Instead, in a plot worthy of Yes Prime Minister, Theresa May instructed her MPs to support an amendment which rebelled against her previously stated policy that the Withdrawal Agreement (WA) could not be re-negotiated, to the effect that the Northern Ireland backstop should be renegotiated so as to be replaced by ‘alternative arrangements’. This, the ‘Brady Amendment’, was passed.

The ‘Malthouse Compromise’

In the meantime, a new, somewhat related, Brexit rabbit hole was opened up. The grandiosely named ‘Malthouse Compromise’, more prosaically called ‘Plan C’ (£), consists, confusingly, of a Plan A and a Plan B. There is nothing new about either of them. They are re-treads or amalgamations of various documents that have been circulated by the ERG and allied groups for several months*. But, significantly although surprisingly, this initiative has the support of non-ERGs from the more remain wing of the Tory Party, such as Nicky Morgan.

Plan A is effectively the existing WA with the backstop ripped out to be replaced by the miraculous ‘alternative arrangements’ proposed by the IEA’s Shanker Singham (formerly of the now defunct Legatum Institute) and others last December. These arrangements are, in the main, the technological solutions which the ERG and its allies insist exist but which no one else has found sufficient evidence of. In a sense, Plan A is a more developed version of the Brady amendment.

If Plan A fails then Plan B is effectively the ‘managed no deal’ canard, whereby there is no WA but, nevertheless, an agreed transition period and various side deals on security etc. Implicitly, as with Plan A, the envisaged future trade relationship is Canada +++ but Plan B also invokes the latest ERG factoid, concerning GATT Article XXIV which, unfortunately, doesn’t mean what they think it does.

These ideas have been endlessly debunked by a series of experts – they are the “junk ideas” I referred to in a recent post as “having no foundation in political reality”. They have already been advanced and rejected not just by the EU but by the UK Government. The latter is an important point to make, given the climate of accusations of EU punishment, and it was made by Sabine Weyand, the EU’s formidable deputy Brexit negotiator and trade specialist.

In a very rare public appearance this week Weyand pointed out that, as regards alternative arrangements and technological solutions for the Irish border, UK negotiators had tried and failed to identify these. But, she pithily observed, this was not their fault, since such solutions “do not exist”. She also pointed out what should be obvious, that the negotiations over the WA are now closed.

Back to Brussels

Yet it does need to be pointed out. Although Theresa May has not gone so far as to endorse the ‘Malthouse Compromise’ – really, I can hardly bring myself to use this terms which sounds like a trashy thriller – only calling it “a serious proposal which we are engaging with sincerely and positively”, she has committed to going back to Brussels to re-open the WA in order to amend the backstop. To that extent she has more or less embraced Malthouse Plan A. And there can be little doubt that what most of the Malthousers want from that is it to be removed altogether. Otherwise, presumably, most of them won’t support any amended deal when it comes to the ‘second meaningful vote’. Then, the pressure will be on May to adopt Malthouse Plan B as the pre-ordained direction of travel from Plan A.

The best way of thinking about this is to imagine the converse situation, in which the EU at this late stage announced that despite what has been agreed in the negotiations only by, say, increasing the financial settlement and changing the backstop back to being Northern Ireland only will it be possible to secure sufficient support from the European Council and Parliament. The outrage of Brexiters can easily be guessed at, and the UK response would almost certainly be a flat refusal.

That may be the EU response, as some early reports suggest. I hope not, because it will just feed the absurd punishment narrative and allow Brexiters to pretend that they had sought a deal in good faith and been rebuffed. Better, and perhaps more likely, for there to be some new declaration or form of words which will then put the responsibility that they so hate back in the hands of the Brexiters. On this, much may hinge for the future both in terms of UK politics and EU-UK relations.

The economic damage is mounting

Whilst all this is going on, there is some really serious damage being done. As has been planned for a while, the European Medicines Agency has moved from London to Amsterdam. With it will go not only 900 jobs but a central part of the ecosystem of the pharmaceutical and biomedical industries – which are strategically crucial for the UK and in which the UK has been a leading global player. It’s worth recalling that in April 2017 the first Brexit Secretary, David Davis, opined that there should be no reason why it couldn’t stay in Britain post-Brexit. Like so many other Brexiter claims, it was known to be nonsense by experts but their knowledge was dismissed and mocked.

We now have companies spending huge amounts of money on stockpiling goods in warehouses in case of there being no deal, and almost every day brings news of another company moving its Headquarters out of Britain. The entire P&O fleet is to be re-registered in Cyprus. A group of leading food retailers has written a letter to MPs warning in stark terms of the dangers of food shortages. In any other time that would be seen as extraordinary. Now, it barely survives one day of the news cycle. And, of course, as with every other warning it is immediately trashed as Project Fear or, with the cynicism of the unworldly, as an excuse by supermarkets to unnecessarily raise prices.

Every Brexiter MP and commentator is an instant expert on the food industry, just as they are on the car industry or aerospace, knowing far more than those who actually work in and run those businesses. Or, for those of such self-evident ignorance that any claim to expertise would cause instant laughter, a more boorish approach is taken. Hence one of the most shameful of recent events, when Mark Francois, Deputy Chair of the ERG, denounced the CEO of Airbus, one of the UK’s most important employers, for being German, tore up his letter warning of the consequences of no deal, and talked about his own father having stood up to German ‘bullying’ on D-Day. It would be hard to find a more compelling image of the silliness and sheer nastiness of the Brexit Ultras.

Britain’s shame

In fact, I was wrong to say that bewilderment and dismay are the only feelings to be had about what is happening. There is also shame. The shame not so much of being a member of a country where such political oafery exists – all countries have their share of that, after all – but of one whose entire political class has brought us to this. I don’t (just) mean Brexit, I mean a country made so weak and incompetent that it is reduced to begging the friends it has reviled for non-existent solutions to problems of its own making, for fear of fantasists, charlatans, numbskulls and thugs.

And, worse, since that unholy alliance is beyond appeasement and reason it is rather more likely tonight – despite the passing of a non-binding, and in itself rather meaningless as it is not a vote for anything, amendment that rejected a no deal outcome - than before that the UK will be leaving the EU with no deal. If so that will be the very worst outcome of Brexit, and nothing remotely like what voters were promised, leaving Britain facing a calamitous future.
*For fuller discussion of the Malthouse Compromise, see Ian Dunt’s piece. He summarises it as follows: “It would not get the support of the EU, it cannot be done in time, it does not solve the problems it claims to, it is legally and strategically unsound, grossly misleading and full of lies about WTO laws its authors have not fully understood”. Otherwise, pretty sound. See also this article by David Henig, former civil servant and trade expert.

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