Friday 16 April 2021

We are still Brexiting

We have now passed the 100-day point since ‘economic Brexit’ – the end of the transition - and to mark it Yorkshire Bylines put together an excellent series of briefings from regular and guest contributors (disclosure: I am one of them). Taken together these provide as good a summary as there is of what has happened during this period.

It may seem as if not much is happening, but that’s far from true. As regards this week, specifically, a few developments stand out. One is the release of February’s trade figures which, as expected, show some bounce back after January’s precipitate decline, but as before it is still too early to see what the eventual structural changes will settle to, especially as regards services trade. Plus the UK has yet to introduce import controls.

So it is certainly far too early to proclaim, as some of the usual suspects have, that the hit to the UK economy has been “completely trivial”. The best analysis I’ve seen of the economic cost of Brexit, updated to include these new figures, comes from John Springford of the Centre for European Reform (which, in fact, shows that, even were there to be no more damage, just what has happened since 2016 is far from ‘trivial’).

The other, more political, story is in reports of progress and a more positive atmosphere (£) in talks between the UK and the EU over implementing the Northern Ireland Protocol against the background of the violence in the province. Yet there is a need for caution, as Mujtaba Rahman suggests, because a durable political solution seems as far off as ever (if, indeed, such is possible). Whatever may happen in the next few days – a ‘stock taking’ meeting between Joint Committee co-chairs David Frost and Maros Sefcovic was held yesterday evening, and Sefcovic is briefing EU Ambassadors this morning, so there may be a statement soon – the issue, as with the economic effects, is to recognize that not too much weight can be put on individual ‘data points’. The implementation of the NIP is not suddenly going to be resolved in a single moment, but will be, at best, an ongoing process that goes in fits and starts.

A multi-threaded process

So just as the structural impact on trade will emerge over time, partly as a result of decisions about supply chains that companies take in the coming months and years, so too will the politics of the UK-EU relationship go in fits and starts. Moreover, the process will be multi-threaded, with the threads not necessarily aligned. Thus even if there is currently some rapprochement over the NIP, we also saw this week reports that the EU will not agree to the UK re-joining the Lugano Convention (£). This, which allows the civil and commercial judgements made in one member’s courts to be enforced in the countries of the other members, is one of the many byways within the Brexit saga. As I discussed in May 2020, when the UK made its application to rejoin, it was questionable whether the EU would agree, and it now seems that it won’t.

My point, then, was that it showed the limitations to the Brexit government’s idea of sovereignty, because like it or not the UK, like every other country, is partly dependent on the decisions of others. Now, it also shows the limitations of the government’s ‘hardball’ approach to post-Brexit negotiations, because it invites the same response from the EU. I am not saying that there is a direct link between the UK’s decision to flout the NIP as regards grace period extensions – still the subject of legal action, which the government this week requested it be given more time to respond to – and the EU’s stance on Lugano membership. But it doesn’t seem outlandish to think that squandering trust and goodwill over one issue has some impact on other issues.

All of this serves to illustrate that the entirety of Brexit is, as it was always going to be, an ongoing process even after the exit and future terms deals were struck. Indeed, the Trade and Cooperation Agreement (TCA) has still to be ratified by the European Parliament, and setting a date to do so has been held up by concerns over the UK’s violation of the NIP, although votes in some important committees this week suggest that approval may be in prospect. Moreover, the complex architecture of technical sub-committees established by the TCA have still not actually been convened, primarily because the UK government’s pique about the delayed ratification – a classic example of cutting off the nose to spite the face, since it would greatly help UK businesses were they to meet.

Then there all the things which, like Lugano, lie outside of the TCA. These include the still unresolved matters of recognition of financial services regulation and data protection equivalence. The latter now looks to be getting close to being granted but if so then, like anything granted on financial services, it will always be possible for the EU to unilaterally withdraw recognition. In short, we are still Brexiting.

Laying the blame

As noted in my previous post, there’s nothing in opinion polls to suggest a widespread consensus that Brexit was a mistake. If anything, according to pollster Peter Kellner, there has been a slight rise in support for it, probably attributable to perceptions of the vaccine rollout. But commentators leaping to conclude that Brexit has now been accepted as a positive thing (£) are, again, putting too much weight on current data and on small shifts within it. Such judgments are premature, and will be for quite some time.

The reality is that, with small variations, public opinion about Brexit remains more or less evenly split. Yet in a way this is a sign of its failure. After all, Brexit wasn’t supposed by its advocates to create a permanently divided nation. It was supposed to be an incontestably ‘good thing’. Instead, just a few months into actual Brexit, what is striking is how few are standing up to claim credit for it. The more prominent discussion is of the question: who is to blame for this mess?

It is a discussion which entails a certain amount of re-writing of history. This week, the Labour MP Barry Sheerman correctly made the point that Boris Johnson had been repeatedly warned of the dangers Brexit posed for the Northern Ireland peace process. In response, Gavin Barwell, who became Theresa May’s Chief of Staff after the 2017 election, asked Sheerman how many times he had voted “against a Brexit deal which would have avoided these problems, ultimately leading to Theresa May standing down and Boris Johnson becoming Prime Minister”. The week before, the Mail on Sunday columnist Dan Hodges made a similar argument, though referencing remainers in general rather than Labour MPs as having responsibility for what is now happening because of having failed to back May’s deal.

A trip to the archives

I anticipate this kind of account gaining considerable traction – in fact it has been swirling around for well over a year already - so it is worth examining in some detail, not least as Barwell was a serious player and, by all accounts, an honourable politician. There are actually two different claims within it. One is that May’s deal could have been passed had Labour (and other opposition) MPs supported it. This has to be about MPs, not ‘remainers’ in some general sense, as only MPs had a chance to vote on it. The second claim is that, had May’s deal passed, the present problems in Northern Ireland would not be happening.

I’ve written before of the perils of such counterfactual history, and back in August 2020 also gave a preview of the ‘blame games’ that would emerge if there were no (trade) deal, many of which are now on display in this different context. So I won’t repeat all that, but focus only on the claims Barwell makes, neither of which stacks up.

Barwell claim #1

On the first claim, the first thing to say is that May made no attempt to garner opposition support for her deal, even though the original ‘meaningful vote’ planned for December 2018 was postponed because it was clear she would lose it. Only after it was held and lost in January 2019 did she belatedly ‘reach out’ to opposition parties but excluded Labour until after losing the third meaningful vote. Moreover, she continually insisted that the only alternatives to her deal were ‘no deal’ or ‘no Brexit’ and thereby – even if unwittingly – encouraged all those who wanted either of those outcomes to oppose it.

More importantly, if her deal had passed in the face of bitter opposition from the ERG and the DUP but with Labour support, it is inconceivable that her government would have survived even long enough to sign the Withdrawal Agreement (WA) with the EU. There would certainly have been a parliamentary Vote of No Confidence, which all opposition parties would have been bound to vote for and, unlike the one which actually occurred in January 2019 (after the first meaningful vote), the ERG and DUP would surely have joined them. That is evident from their “furious” reaction to the talks she did have with Labour. What exactly would have happened then is unclear – presumably a general election with the Tories under a caretaker leader, and whoever that was they could hardly fight on a platform of May’s deal, given how few Tory MPs supported it.

But even if the inconceivable is conceived, and May’s government survived to sign the WA with the EU, what would this have meant for Brexit in general and for Northern Ireland in particular? May’s premiership itself could not have lasted much longer than the WA, if only for lack of DUP support and, anyway, she offered her resignation in return for backing her deal at the time of the third meaningful vote in March 2019. So there would have been a Tory leadership contest, presumably leading to Johnson coming to power, and very likely a general election at that point. If that also yielded a Johnson victory (or if there had been no election but he’d regained DUP support to continue without one) then there would certainly have been an attempt to renegotiate the Withdrawal Agreement which he and the ERG would undoubtedly be calling a ‘surrender document’. And, even if that attempt failed, such an administration would (as the actual one did) seek a very distant relationship with the EU.

Barwell claim #2

So, then, Northern Ireland. If May’s WA had been struck and survived, it would still have been regarded by unionists as unacceptable – as the DUP’s implacable opposition to it showed - because there would still have been some degree of differential treatment of Northern Ireland. How much would depend on the future terms agreement not the WA. Barwell suggests that it would have been minimal, or non-existent, because May had promised regulatory alignment. But that promise had no guarantees, and it is impossible to see how May (even if she had continued) could have delivered that in the face of ERG opposition, unless Barwell seriously envisages Labour propping her up for months whilst she negotiated her trade deal, and supporting all the related domestic legislation. In any case, since she couldn’t have survived, the future terms would have been agreed by Johnson, and there would have been no regulatory alignment.

In short, under any realistic assumptions, there is no way that May’s deal (and, even more, anything, such as Common Market 2.0, that might have been agreed to in the Indicative Votes) could have been delivered by the government given the ferocious opposition to it from the ERG and the DUP. And, even if it had, the unionist opposition means it wouldn’t have prevented what is now happening in Northern Ireland. That could only have been averted by enacting it in a form that retained single market and customs union membership, which Brexiters – including the DUP – rejected as did May, from the Lancaster House speech of January 2017 up to and including the Political Declaration which suggested that the future terms deal would exclude freedom of movement of people and would provide for an independent trade policy. So the blame lies squarely with the Brexit Ultras, with May and, of course, with Johnson.

This isn’t ancient history – it’s live politics

This is history, in a way, but that matters because, in George Orwell’s famous line, ‘who controls the past controls the future’. In any case, it is hardly ancient history. It may seem a life time ago – both because of all the Brexit developments since, and of course the pandemic – but it is only a shade over two years ago that the meaningful votes were held. That really is no time at all. And, perhaps more to the point, the reason it is being dredged up again now is because people have political reputations to protect and agendas to pursue, and assigning and diverting blame is crucial to that.

Indeed, just as Barwell contends that the current situation derives from May’s deal having been thwarted, it is now a foundational myth of Brexiter belief that all that is going wrong with Brexit is down to Theresa May having ‘given in’ to the EU’s ‘unreasonable demands’ (as, for example, in historian Ruth Dudley Edwards’ absurd Telegraph piece this week, the more absurd since, like so many now lambasting the sea border, she advocated Johnson’s deal which created it). In doing so they absolve themselves of responsibility, whilst also ignoring that the problems May’s approach created were due to her misguided embrace of the hard Brexit they advocated. In that, they are actually helped by Barwell’s misguided characterization of May’s approach as being a substantive repudiation of hard Brexit since, to them, therein lies her sin.

So what is underway isn’t the ‘post-match inquest’. Because we are ‘still Brexiting’, it is about the live, ongoing politics of how the UK-EU relationship should be conducted and how it should develop. Specifically, the extent to which the impact of the Irish Sea border can be minimized is still a question of UK willingness to align regulations with the EU, especially sanitary and phyto-sanitary regulation. Even such an alignment won’t fully resolve matters, because the unionist objections are more based upon the symbolic politics of the border than the technical details (which is why, in those symbolic terms, May’s deal was almost as objectionable to the DUP as Johnson’s). Still, the technical details do affect the practicalities of supply disruption and that’s not unimportant.

The shape of future UK-EU relations

More generally, the question of a closer or more distant relationship with the EU continues, and will continue. It inevitably did not end with the TCA because of the brute facts of geography and economy. Thus Brexiter accounts of May having ‘given in’ are potent primarily because they give licence to their present attempts to make the relationship with the EU antagonistic and more distant. That is allied with attempts to obscure the damage that Brexit is doing, one part of which is to suggest that if there is any such damage it is down to Brexit not having been done properly because of May’s supposed weakness.

The latter is significant, because one of the crucial fault lines in public opinion now and in the coming period is between those who think that Brexit was intrinsically flawed and those who think it was only flawed in its delivery. As Kellner points out, there is a large constituency of voters whose views about Brexit are not very strongly held and who are liable to change their minds quite easily. Where (and whether) the opinion of this group eventually settles will have an important effect on where the politics of post-Brexit relations lands. However, this terrain is a tricky one for Brexiters because it pushes them in contradictory directions. On the one hand, to defend Brexit they need to downplay or deny the adverse consequences. On the other hand, to critique the way Brexit was done they need to focus on those consequences.

In this context, an important development this week was the formation and first session of the UK Trade and Business Commission, a cross-party group of MPs, business leaders and economists. Its focus will be the trading relations between the UK and the EU, and UK trade deals with other countries. It is noteworthy because almost all parliamentary scrutiny of the ongoing realities of Brexit has been closed down, including the Select Committee on exiting the EU that was chaired by Hilary Benn, who co-chairs this new commission. It is not an official or parliamentary body, and so has the potential to do the same kind of job for the trade and business aspects of Brexit that Independent Sage has done in providing informed, evidence-based data and discussion in relation to coronavirus.

This initiative has already received quite a bit of media coverage, and that is important because it is remarkable how little attention Brexit is now receiving. For example, the fact that the UK has requested extra time to respond to allegations that it has broken international law – hardly, one would have thought, a minor matter – is barely mentioned in the UK media. Where there is high-profile coverage, it eschews mundane but important issues like, say, the fact that the TCA committees haven’t met, in favour of, for example, James Dyson’s airy fatuities about Brexit giving Britain an ‘independence of spirit’.

The politics of ‘don’t know’

Overall, then, the guiding thread in all this is that we are in an unsettled situation across a number of dimensions which makes it too difficult, and too early, to identify a direction of travel. That uncertainty relates to the economics of Brexit, the politics of the UK-EU post-Brexit relationship, the security situation in Northern Ireland, the question of Scottish independence, and, out of all that, the formation of public opinion. Going back again to Kellner’s analysis, this will have big implications for domestic politics: “if Johnson, leading a more-or-less unified party on this issue, can persuade voters that Brexit is going well, he will be hard to defeat at the next election. Wherever Labour ends up, its first task is to undermine that Panglossian sentiment. A bold and compelling alternative to the current version of Brexit would help.”

That echoes my own recent argument that Labour needs to offer a different narrative on Brexit, and now is the time because a ‘common sense’ public opinion about whether Brexit was a success or a failure could coalesce quite quickly. That won’t be based upon arcane details of sanitary and phyto-sanitary regulatory alignment or membership of the Lugano Convention, but formed by big, broad brushstrokes of perception.

There is, however, another and perhaps more plausible scenario. One, quite sensible, reading of the referendum result would have been that the answer the public, considered as a single entity, gave to the question posed was ‘we don’t know’. The biggest scandal of Brexit is that this was then taken as an endorsement for almost the hardest form of Brexit imaginable. But what if, with that having been enacted, the settled view of ‘common sense’ public opinion remains ‘we don’t know’?

If that is how things shake out, then we are in real trouble: doomed to unending domestic division, whilst still, despite everything, having failed to create a stable and sustainable form for our country’s relationship with its continent.

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