At the corner of my road is a display board for local notices and, recently, the council have put one up about a project to support local businesses and community organizations to re-open as Covid restrictions ease. Prominently and, to my mind, poignantly displayed on the sign is an EU logo, for this project is part-funded by the EU Regional Development Fund. I assume it is the very last trickle of money from the 2014-2020 programme.
It’s a reminder that although the Brexit process has been going on for years, we are actually only eight months into being substantively outside of the EU. Not only that, but in many respects we have not yet experienced the full reality of it.
Travel to and within the EU
The pandemic is one obvious reason, because it has curtailed both leisure and business travel to EU countries. The latter will be especially significant for services trade, as Head of Trade Policy at the British Chambers of Commerce explained this week. A particular sub-set of this, which has received much media attention, is the impact on European touring for musicians and other performance artists. A highly misleading government announcement this week implied that some new agreements had been reached on this, but, despite reports taking this implication as if it were a fact, it actually only confirmed what was already known about visas and didn’t address the underlying problems of touring.
In any case, many people who would otherwise have done so have yet to encounter the new complexities and restrictions such travel now involves for British people, with more to come in 2023 when the European Travel Information and Authorisation Scheme begins (inevitably described as “new Brexit punishment” by the Express). Similarly, anyone who in lockdown has watched old episodes of those TV shows about relocating to Spain, France, Cyprus and so on will be in for a nasty shock if they are inspired now to try it for themselves. For whilst it is still possible, it is much more difficult: one of the more incoherent Brexiter ideas was that ending freedom of movement of people would radically reduce the number of EU citizens moving to Britain yet, somehow, would scarcely, if at all, impact on British citizens’ freedom to move to EU countries.
Introducing import controls
Then there is the staggered introduction of so many aspects of Brexit. The various grace periods in the operation of the Northern Ireland Protocol have featured fairly prominently in the media. Perhaps less widely reported is the fact that the UK has yet to introduce full controls on EU imports. This might seem surprising given that the decision that Brexit meant leaving the single market and customs union was taken in January 2017 and, after all, the EU was ready to impose its import controls at the end of the transition. The reason is a mixture of the persistent failure to understand that this was bound to mean border controls, the political problem of admitting it when it seemed conceivable that Brexit might still be reversed, and the stubborn refusal to extend the transition period when it was possible.
So in the government’s desperate hurry to declare ‘independence day’ it ignored its own lack of preparation to be independent. Indeed, in March, it postponed phases two and three of the Border Operating Model so that controls which were due to begin in April and July of this year have been pushed backwards. However, as with the expiry of the Northern Ireland grace periods, in the absence of further postponements the date for these controls to begin is rapidly approaching.
This means that from October 1 2021 - less than two months away - there will be checks on agri-food and feed documentation, with the next and main tranche of controls coming in on January 1 2022, and the final stage, covering live animals and low-risk plant products, being introduced in March 2022. Only then will the Brexit controls on UK-EU trade in both directions be fully in place. One significant problem, which already exists but will be exacerbated once import controls are in place, is a chronic shortage of the vets needed to undertake the necessary checks, itself caused in part by the end of freedom of movement of people.
Still later – in March 2023, it was announced this week – will the much-delayed Customs Declaration Service IT system be fully up and running (in the meantime, the antiquated and creaking CHIEF system [£] will remain in place). It wouldn’t exactly be surprising, given the history of government IT projects, including this one, if there were further delays. All these dates become the more remarkable considering that the entire Trade and Cooperation Agreement will be up for review after five years of being in force, meaning the end of 2025, whilst the Northern Ireland Assembly will vote on continuing consent to the Protocol in December 2024.
Although it may be that introducing import controls results in some significant disruption it would be better, as I’ve argued before, to see the effects of Brexit in terms of a slow puncture than a dramatic tyre blow-out. It will probably be like the immediate and visible effects of export controls (i.e. EU import controls), which have ‘settled down’ in the sense of beginning to make a long-term adjustment to trade being at lower levels than before. This has important political (non-)consequences, because, despite what some have expected and may still expect, there’s unlikely to be any ‘moment of realisation’ when public opinion registers the damage of Brexit.
Instead, there will be a gradual decline which, as with the current widespread reports of empty shelves and unpicked produce, causes inconvenience but probably no dramatic crisis (though some warn of it). The underlying issue of labour shortages means it will be the same story across many sectors, from construction to hospitality. But, because this isn’t a controlled experiment, it was always going to be hard to definitively explain the decline in terms of Brexit, and the pandemic makes that even more difficult. Even if it’s true that it is only the UK, and not EU countries, which is seeing these problems, that isn’t going to register with most voters.
Investment and regulation
Still less will the negative impact on foreign direct investment (FDI) in the UK register, although in the long-run that may be much more important than supply chain disruptions. Here again there will be debates amongst commentators and politicians about the role of Brexit but, as with UK-EU trade, the key point is that in what are inevitably multi-factorial issues the contribution of Brexit can only be a negative one. By definition it depresses UK-EU trade compared with not-Brexit, even if there is scope to argue about the precise extent, because it introduces new barriers to trade.
On FDI (not to be confused with overseas acquisitions of UK businesses, often by private equity firms, which is happening apace because of low company valuations caused in part by Brexit [£]) and related issues the only argument that Brexit would be beneficial is based on the creation of a more attractive regulatory environment. But, so far, ideas for what this would consist of have proved elusive, hence the recent TIGRR report was so anodyne.
The reason for this is that, despite years of propaganda to the contrary, neither EU regulation nor regulation in general have been major problems for UK business. Unsurprisingly, therefore, in a key industry often cited as a prime example for the advantages of regulatory freedom, financial services, recent regulatory reforms, whilst extensive, have not been radical (£). And, interestingly, despite the claims sometimes made about the ‘real agenda’ of Brexit, the government, at least for now, is resistant to removing the EU cap on bankers’ bonuses (£).
Conformity assessment
Meanwhile, as I’ve been flagging up since March, manufacturers, far from being freed from ‘red tape’, will have to implement the new UK Conformity Assessment (UKCA) registration and marking system in order to sell most goods in Great Britain from January 2022. This replaces the CE mark which will, however, continue to be needed to sell goods in the EU. The CE mark will also be valid in Northern Ireland, as will the UKNI mark (though not the UKCA mark) which can also be used by Northern Irish companies selling in Great Britain, but not in the EU, including Ireland, which will require a CE mark. There are also rules about the various combinations of CE, UKCA and UKNI markings that are permissible within different markets.
It’s exactly the kind of double (or triple?) regulatory burden that the single market abolished, and it’s also very unclear whether the UKCA assessment system will be up and running in time. Even if it is, it’s equally unclear whether firms will be ready. It is small firms which are most likely to struggle, as with the new trade barriers (of course it is also, itself, a new trade barrier but it will also affect those firms which only sell domestically).
Regulatory issues go beyond the generic one of UKCA registration, so that different industries and sectors face different challenges. A complicated example is the medical devices sector (which has secured an extension on the use of the CE mark until June 2023). An EU-wide system was still under development as Brexit happened, and the UK is set to develop its own system but it is not yet in place and it is as yet unclear how it will work. Another example is the huge cost to the chemicals industry (and, actually, beyond) of creating the UK REACH system in place of REACH, the EU system, which has also often been mentioned before on this blog, and has had quite a bit of media coverage (£). A sub-set of this is the particular problem faced by suppliers of biocidal products, which from the end of 2022 will have to achieve ‘GB Article 95 listing’ to supply the British market.
What all these examples, and many others that could be given, share is the basic issue that the UK/GB market in itself is relatively small, thus having its own regulatory system may simply make that market too costly to service, especially for smaller firms, and more costly for those who continue to do so. This in turn means it will be more difficult and costly – or in some cases simply impossible - for British customers to buy the goods they want. For example, the UKCA mark will be needed to sell goods in Great Britain but will not be recognized anywhere other than Great Britain, so the incentive not just for companies in the EU but anywhere else in the world to register is relatively small, and for some products may be tiny.
The bizarre irony is that, in many and probably most cases, it isn’t that actual product standards are set to diverge from EU standards and, quite possibly, they never will. It is that there are, or will be, different processes (and associated costs) of testing and registration in Great Britain and the EU (and Northern Ireland). Nor is this an inevitable consequence of Brexit or even of hard Brexit: it flows for the most part from the Johnson approach of prioritizing sovereignty above all else. So we pay a massive price – how much is hard to say, but just the cost to the chemical industry of UK REACH is estimated as £1 billion (£) - simply for the theoretical possibility of regulatory divergence.
Spending our own money
Apart from regulatory freedom, Brexit also promised freedom to spend ‘our money’ as we wished. So, going back to that notice about EU regional funding, the Brexiter response would be that it is only our own money being (partially) returned to us. This, of course, was the Leave campaign’s central economic case - the £350 million a week for the NHS. The idea was that all the EU funds for regional development, farming support, science and so on would still be available, plus a dollop on top. It was always (even stripped of the dishonest conflation of net and gross payments) a lie, because it treated the budget deficit as an entire cost-benefit analysis of EU membership. So, in fact, because of the overall effects of Brexit, none of that promised money exists. Instead, as for example Wales is currently finding, replacing former EU funds is a hit-and-miss battle within the context of general government spending allocations, as it was always going to be, for a share of a smaller pie than there would otherwise have been. Some may get lucky, others won’t.
Away from economics (although not without an economic dimension) it is only gradually that things like the end of participation in the Erasmus + scheme will be felt. A rather boosterish piece in the Sunday Times (£) extolled the “wider opportunities” of the UK’s replacement Turing scheme. But, aside from the perhaps limited attractiveness of some of the destination countries, the key fact that the scheme doesn’t guarantee tuition fee waivers means it is a far from adequate replacement. And whilst the UK will continue to participate in Horizon Europe, the EU science programme, the post-referendum experience of Horizon 2020, its predecessor, suggests that here, too, the UK will be in a worse place.
All of these impacts are to some degree tangible and measurable, even if that doesn’t translate into public awareness. And as the extraordinary ‘Kelemen Archive’ (the link is to item #754, currently the latest entry) documenting Brexit damage stories shows, they extend to almost every sector of British society and economy. Yet they do not exhaust the slow-burn damage of Brexit. That includes the many ways in which political conventions have been strained or broken, and political discourse made more toxic. It also includes the erosion of geo-political status associated with Brexit itself, as well as the reputational cost of the government’s serial dishonesty, especially as regards the Northern Ireland Protocol.
As regards the latter, having written at such length about it in several recent posts, and with events having temporarily quietened because of summer holidays, I’ll say no more except that playing with the stability and security of Northern Ireland is one of the worst aspects of what Brexit is doing. But, again, how much does it register with the electorate in England, at least?
Judgment day?
Although they didn’t mention it at the time of the referendum, it has become common now for Brexiters to say that the benefits of Brexit will not reveal themselves for years. That is convenient cover in all kinds of ways, including how it falsifies another Brexiter claim – made again recently by Dominic Cummings - that, by ‘taking back control’, the public will hold MPs accountable for systemic failings. There’s little chance of that if we have to wait 50, or even 100, years before passing judgment on Farage, Johnson, Gove et al.
Even if that judgment comes sooner, there seems very little prospect of some cathartic moment in which it becomes ‘received wisdom’ that Brexit was a colossal, historic blunder. It’s true that things can change – public support for Munich, Suez or Iraq dissipated more or less quickly – but it is possibly easier to recognize and admit foreign policy failures than those deeply embedded in domestic politics and cultural identity. It’s also true that these are, indeed, very early days and something – more likely something political, like Scottish independence, than something economic, like declining trade – could jolt England out of its apathy.
But for the time being I think it’s more likely that we will get gradually poorer than we would have been, living more restricted lives than we would have had, having more complex and burdensome regulation, and with our standard of living - in both economic and more extensive senses - slowly slipping behind those of other North and West European countries.
To re-iterate, no one lives in the counterfactual world in which Brexit didn’t take place. So although those of us who recognize what is happening will mourn our losses and rail against them, just as many, if not more, will deny the reality or be unaware of it, or simply – in one of the more endearing of English ways – mutter ‘mustn’t grumble’ and ‘it could be worse’ and settle down with a nice cup of tea.
That assumes that there is still tea in the shops, of course, despite supply chain disruptions. It would be strange if after all the World War Two nostalgia surrounding Brexit, Johnson found, as his hero Churchill knew only too well, that lack of tea might be the one thing to spell real trouble for the government.
I may not post every week over the summer – it will depend on whether there is any important or interesting Brexit news. If you want some holiday reading in its place, and haven’t read it yet, you might consider getting hold of my book! It’s called Brexit Unfolded. How no one got what they wanted (and why they were never going to) and was published by Biteback on 23 June 2021. It can be ordered from Biteback, or via other online platforms, as a paperback or e-book. For reviews, podcasts etc. see this page.
Showing posts with label Foreign direct investment. Show all posts
Showing posts with label Foreign direct investment. Show all posts
Friday, 6 August 2021
Wednesday, 27 June 2018
What business is saying about Brexit, and why
Much
attention has been focussed on the dismissal of warnings from Airbus – and an
increasing number of other businesses - by Jeremy Hunt, Boris Johnson and
others. Less attention has been given to the
specific reason given by Hunt as to why Airbus should keep quiet: that it
undermines the British government’s capacity to negotiate with the EU.
This is nonsense, for the simple reason that the EU negotiators, and all informed commentators, know full well how damaging Brexit will be for most businesses, especially those with closely integrated European Just-in-Time supply chains (£) like Airbus but, to varying degrees, all businesses of all sizes which trade with the EU-27. Indeed companies and trade bodies have been warning about it for well over two years and with growing insistence since last year, because of the way that business investment cycles and location decisions work. This isn’t a game of poker – or, if it is, it is one in which both players can see each other’s hands.
The only people who persist, wilfully, in not recognizing this damage are the Brexiters who dismiss it as (of course) Project Fear. Even that dismissal is perverse, since if the warnings are indeed nonsense then making them would not be helpful to the EU negotiators in the way suggested by Hunt anyway.
In fact, the only thing which make the negotiations difficult is that Britain, to the extent that its government can agree on an aim, is seeking as the outcome things that it has already excluded by virtue of its red lines. Specifically, Britain is seeking something like the kind of frictionless trade that is only achievable by being in the single market and a customs union, which it has ruled out; and participation in agencies and programmes regulated by the ECJ, which regulation it has rejected.
So, in summary, this is the central paradox of the government’s Brexit approach thus far: it is seeking to negotiate something which it has already rejected.
This is the real meaning of the ‘Barnier stepladder’. It is not so much that, as leading Brexit academic Professor Anand Menon recently put it, “this is the choice that the EU has presented us with”. It is rather just a tabulation of the types of relationship which have been identified by numerous other analysts, going back well before the referendum – but set against the red lines Britain itself has specified.
It’s true that Britain can expect to have a ‘bespoke deal’, but only in the trivial sense that every relationship with the EU has its own particularities (e.g. the Canada FTA is different to the South Korean FTA): but the basic binary of being inside or outside the single market is unavoidable, as Sir Ivan Rogers, amongst many others, has repeatedly pointed out.
On Barnier’s diagram, the British red lines mean that the only trade options left are a Canada style FTA or no deal. Personally, I do not see how a Canada FTA (or any other FTA) can be compatible with the UK (and EU) red line of there being no hard Irish border. But, leaving that aside for today (although, of course, it is a core issue), we might wonder why Brexiters are so troubled by this? After all, before the referendum, those who were not saying that we would be ‘like Norway’ were usually, like Boris Johnson, extolling the virtues of a Canada-type arrangement. If this were indeed so desirable then, again, there would be no problem save, perhaps, timing. The EU are, apparently, quite willing to enter into such a relationship.
But, of course, Johnson’s was a false prospectus. As he and other Brexiters were warned, but ignored, at the time, a ‘Canadian’ hard Brexit would be completely inadequate for services, and also for most manufacturing, because of the non-tariff barriers that the single market seeks to abolish. A no deal Brexit would be even worse for trade and – potentially far more immediately damaging – for non-trade issues such as air travel. Again, there’s no mileage in the idea, floated by Fox, Davis, Johnson and others, that somehow the EU can be made to believe the UK would walk away with no deal: it is, literally, incredible and the EU know that to be so whatever bluster the Brexiters put up. No country is going to deliberately engage in such self-immolation (though that does not mean it might not happen through a series of accidents).
So at least for the government – although some ministers have apparently still not grasped it – it is no longer possible to regard either Canada or, still less, no deal as viable policy. Thus it has lighted on the idea that it is possible in some way to ‘negotiate’ membership benefits without membership. That won’t happen not because the EU are punishing us, and certainly not because we have ‘shown our hand’, or had it revealed by Airbus et al but, simply, because it is a logical and legal impossibility.
The question then becomes: is the government going to realise that in time, which means either forcing the Brexiters within and outside the government to accept that or at least to face them down? This, supposedly, is what next week’s cabinet meeting is intended to result in, but we have heard that before. Perhaps the pressure of time and the pressure from businesses will yield results this time. I am not so sure, though, because even the softening of hard Brexit which seems to be under consideration seems to be a long way from realism, being based, still, on the ‘customs partnership’ idea and, now, on seeking single market membership for goods only. The former is an entirely untested and highly bureaucratic model, relying on high levels of trust and goodwill. The latter, I believe, seriously understates the complex inter-relationship between goods and services and, even if the EU accepted it I doubt it could be made to work in practice. I’ll post more on this if and when it emerges as government policy.
The fact that, thus far, the government have refused to face up to the real options available and the choices to be made is what is leading so many businesses to speak out now (and, it seems, many more are saying similar things privately). It is not simply about no deal Brexit versus hard Brexit, it is that even hard Brexit will damage them. In this sense, whilst it is true that businesses want clarity, it certainly does not follow that once they have clarity they will be happy to stay in the UK. It is just that they will then be able to make the decision as to whether to stay or not, with all that means for jobs and taxes which the Labour Party would do well to note. Thus clarity may be good for them, to allow them to make plans, but it won’t necessarily be good for the rest of us: for many manufacturing and services businesses the only clarity that will make them likely to stay would be for Britain, in fact or in very near effect, to stay in the single market and a comprehensive customs union.
In the absence of that, there probably won’t be big, immediate pull outs – especially where there are large sunk cost installations as in the car industry - but, rather, gradual disinvestment over many years. Indeed, there is already evidence of that as the government’s own figures show. But whilst ruling out the least economically damaging option, the government has not accepted what the alternatives must, by definition, be. What businesses are saying to them is that it’s time – in fact it’s long overdue – to get real. In that way, far from undermining the negotiations they are pushing for the only way in which the negotiations can make progress.
This is nonsense, for the simple reason that the EU negotiators, and all informed commentators, know full well how damaging Brexit will be for most businesses, especially those with closely integrated European Just-in-Time supply chains (£) like Airbus but, to varying degrees, all businesses of all sizes which trade with the EU-27. Indeed companies and trade bodies have been warning about it for well over two years and with growing insistence since last year, because of the way that business investment cycles and location decisions work. This isn’t a game of poker – or, if it is, it is one in which both players can see each other’s hands.
The only people who persist, wilfully, in not recognizing this damage are the Brexiters who dismiss it as (of course) Project Fear. Even that dismissal is perverse, since if the warnings are indeed nonsense then making them would not be helpful to the EU negotiators in the way suggested by Hunt anyway.
In fact, the only thing which make the negotiations difficult is that Britain, to the extent that its government can agree on an aim, is seeking as the outcome things that it has already excluded by virtue of its red lines. Specifically, Britain is seeking something like the kind of frictionless trade that is only achievable by being in the single market and a customs union, which it has ruled out; and participation in agencies and programmes regulated by the ECJ, which regulation it has rejected.
So, in summary, this is the central paradox of the government’s Brexit approach thus far: it is seeking to negotiate something which it has already rejected.
This is the real meaning of the ‘Barnier stepladder’. It is not so much that, as leading Brexit academic Professor Anand Menon recently put it, “this is the choice that the EU has presented us with”. It is rather just a tabulation of the types of relationship which have been identified by numerous other analysts, going back well before the referendum – but set against the red lines Britain itself has specified.
It’s true that Britain can expect to have a ‘bespoke deal’, but only in the trivial sense that every relationship with the EU has its own particularities (e.g. the Canada FTA is different to the South Korean FTA): but the basic binary of being inside or outside the single market is unavoidable, as Sir Ivan Rogers, amongst many others, has repeatedly pointed out.
On Barnier’s diagram, the British red lines mean that the only trade options left are a Canada style FTA or no deal. Personally, I do not see how a Canada FTA (or any other FTA) can be compatible with the UK (and EU) red line of there being no hard Irish border. But, leaving that aside for today (although, of course, it is a core issue), we might wonder why Brexiters are so troubled by this? After all, before the referendum, those who were not saying that we would be ‘like Norway’ were usually, like Boris Johnson, extolling the virtues of a Canada-type arrangement. If this were indeed so desirable then, again, there would be no problem save, perhaps, timing. The EU are, apparently, quite willing to enter into such a relationship.
But, of course, Johnson’s was a false prospectus. As he and other Brexiters were warned, but ignored, at the time, a ‘Canadian’ hard Brexit would be completely inadequate for services, and also for most manufacturing, because of the non-tariff barriers that the single market seeks to abolish. A no deal Brexit would be even worse for trade and – potentially far more immediately damaging – for non-trade issues such as air travel. Again, there’s no mileage in the idea, floated by Fox, Davis, Johnson and others, that somehow the EU can be made to believe the UK would walk away with no deal: it is, literally, incredible and the EU know that to be so whatever bluster the Brexiters put up. No country is going to deliberately engage in such self-immolation (though that does not mean it might not happen through a series of accidents).
So at least for the government – although some ministers have apparently still not grasped it – it is no longer possible to regard either Canada or, still less, no deal as viable policy. Thus it has lighted on the idea that it is possible in some way to ‘negotiate’ membership benefits without membership. That won’t happen not because the EU are punishing us, and certainly not because we have ‘shown our hand’, or had it revealed by Airbus et al but, simply, because it is a logical and legal impossibility.
The question then becomes: is the government going to realise that in time, which means either forcing the Brexiters within and outside the government to accept that or at least to face them down? This, supposedly, is what next week’s cabinet meeting is intended to result in, but we have heard that before. Perhaps the pressure of time and the pressure from businesses will yield results this time. I am not so sure, though, because even the softening of hard Brexit which seems to be under consideration seems to be a long way from realism, being based, still, on the ‘customs partnership’ idea and, now, on seeking single market membership for goods only. The former is an entirely untested and highly bureaucratic model, relying on high levels of trust and goodwill. The latter, I believe, seriously understates the complex inter-relationship between goods and services and, even if the EU accepted it I doubt it could be made to work in practice. I’ll post more on this if and when it emerges as government policy.
The fact that, thus far, the government have refused to face up to the real options available and the choices to be made is what is leading so many businesses to speak out now (and, it seems, many more are saying similar things privately). It is not simply about no deal Brexit versus hard Brexit, it is that even hard Brexit will damage them. In this sense, whilst it is true that businesses want clarity, it certainly does not follow that once they have clarity they will be happy to stay in the UK. It is just that they will then be able to make the decision as to whether to stay or not, with all that means for jobs and taxes which the Labour Party would do well to note. Thus clarity may be good for them, to allow them to make plans, but it won’t necessarily be good for the rest of us: for many manufacturing and services businesses the only clarity that will make them likely to stay would be for Britain, in fact or in very near effect, to stay in the single market and a comprehensive customs union.
In the absence of that, there probably won’t be big, immediate pull outs – especially where there are large sunk cost installations as in the car industry - but, rather, gradual disinvestment over many years. Indeed, there is already evidence of that as the government’s own figures show. But whilst ruling out the least economically damaging option, the government has not accepted what the alternatives must, by definition, be. What businesses are saying to them is that it’s time – in fact it’s long overdue – to get real. In that way, far from undermining the negotiations they are pushing for the only way in which the negotiations can make progress.
Sunday, 13 May 2018
Brexiters are running away from the consequences of what they have inflicted on Britain
During the
Referendum, Brexiters offered a political message which took a traditional and
familiar form: if you vote for us then various (supposedly) good consequences
will follow.
It is easy to imagine what they would be saying now if any of these were evident; if companies were announcing new investments because of (not despite) Brexit; if foreign direct investment were booming in anticipation of Brexit, rather than tanking; if countries, especially Commonwealth countries, were champing at the bit to make new trade deals with Britain; if ‘German car companies’ had ‘within minutes of the vote’ to leave demanded a fantastic ‘cake and eat it’ deal and if the EU had rolled over to give it; if the Irish border was unaffected, as Brexiters had claimed it would be; or, even, if the negotiations were proceeding as smoothly and easily as they had promised.
But of course none of those things has happened and so, since winning the Referendum, the Brexiters’ message has changed in a very fundamental way. The new message takes several forms but each has the same dialectical structure: to decouple the vote to leave the EU from the consequences of leaving the EU.
It’s too late now
The first, and simplest, form is that the vote has now been held and so we must just live with the consequences. In that narrative, all debate and discussion ended with the Referendum. Remainers must get over it, leavers must be happy whatever happens. It’s a position exemplified by a recent tweet from the pro-Brexit journalist Julia Hartley-Brewer in response to being sent data about foreign direct investment since Brexit: “Mate, I really don’t care. This question was asked and answered two years ago. Move on with your life”.
Simple as it is, it’s also naïve. Politics doesn’t work like that, as Brexiters should appreciate not least since on the night before the 2016 Referendum Nigel Farage declared otherwise and, on the night after the 1975 Referendum, so did Enoch Powell. In this if in nothing else Enoch, to coin a nasty little phrase, was right.
Not only does politics not work like that in general, but it especially does not work like that in this case because, much as Brexiters dislike it, winning the vote was just the first and easiest part of a process which, in one way or another, will last for years. Hence they make a second claim.
It’s not up to us
The second version is a denial of responsibility, with the central idea being that leave voters and their leaders have done their part simply by delivering the vote to leave. It is up to the politicians and the experts to now make it happen. This, too, is misguided. As I have written elsewhere, their victory was in many ways a disaster for Brexiters in that it meant that they are now responsible for whatever happens. Not just responsible, but uniquely responsible. They were warned over and over again of the consequences and insisted that these warnings were not just wrong but malevolent, self-interested fearmongering. So, now, they and they alone, own the consequences. Remainers have absolutely no responsibility to try to ‘make Brexit work’ or to ‘get behind Brexit’ (whatever those things would mean in practice).
It hasn’t been done properly
That denial of responsibility feeds into the third emerging Brexiter narrative. It is that there was nothing wrong with the decision, but that the way it is being delivered by the government is what is causing the problems. This is evident in, for example, Daniel Hannan’s recent attempt to deflect blame for the policy he advocated for so many decades. It has many variants, from the outright mad (‘we should just have walked away the day after’) to the more sophisticated complaints about specific decisions, such as the timing of the Article 50 notification. It is fair comment that the government have approached Brexit in an inept way, making what the respected (and by no means anti-) Brexit commentator David Allen Green of the Financial Times has called numerous ‘unforced errors’.
Nevertheless, there are two obvious objections. First, that no one – not least the Leave campaigners – has ever specified a way of undertaking Brexit which does not damage the UK, whether economically, politically or strategically. Second, that every mis-step the government have made has been as a result of pressure from, and has been cheered on by, the Brexit Ultras. That includes the dogmatic ‘red lines’ laid down by the government, the premature triggering of Article 50, and, for that matter, the subsequent calling of a General Election to ‘crush the saboteurs’.
This narrative is a familiar one in business, where any and every failed management fad is defended by its advocates on the grounds that all would have been well but for ‘inadequate implementation’. It’s equally familiar in far Left politics, where each failed attempt to implement communism is explained away by saying that it wasn’t ‘proper’ communism.
But in this case it goes further, and links back to the second narrative, in that Brexiters continue to claim victimhood at the hands of the elite, refusing to accept that having won the Referendum and having a government now pursuing what they voted for, they are the elite, and they are the ones implementing Brexit.
It’s the Remainers’ fault
The fourth excuse is that all would have been well but for Remainers who are accused, variously, of sabotage, treachery and of talking Brexit down. Often, it’s a variant of the paranoid idea about the elite – meaning the Civil Service, Judiciary, BBC, CBI, IoD, House of Lords but not, mysteriously, the ex-public schoolboys, millionaires and hedge funds that support Brexit. Sometimes it’s the entire 48% of voters who didn’t back Brexit.
There are daily examples of this claim, but taking just one, that of Leave means Leave co-Chair John Longworth in August 2017, is instructive. The usual suspects are named, in this case for their “pretence” that Britain must pay a “divorce bill” (i.e. settle its outstanding commitments to the EU). But, of course, it wasn’t a Remainer pretence, and four months later the payment was agreed.
The more general issue is that, if Brexit were the self-evidently great idea its proponents claim, it would hardly matter what Remainers did or said. For that matter, within minutes of the vote, before Remainers had had time to engage in any of their nefarious sabotage, Sterling suffered a catastrophic collapse (which in any other circumstances would have led to a political crisis) as the currency markets priced in their prediction of what Brexit would mean.
It’s the EU’s fault
The fifth narrative is possibly the most dominant of the post-Referendum excuses made by Brexiters. It is that the problem was not with the decision to leave, and not solely (or even primarily) with the British government or with Remainers, but with the EU who have decided to ‘punish’ Britain for leaving. Such claims are invariably nonsense since they ascribe to the EU the consequences of having left the EU (and, in this sense, are another denial of responsibility). To take just the most current of numerous examples, Brexiters claim that the border controls, especially in Ireland, are something being threatened by the EU rather than being ineluctable, legal consequences of leaving the single market and any customs union.
There are many things that could be said about this punishment narrative (see here), but the core difficulty with it for Brexiters is that they repeatedly promised that Britain held ‘all the cards’ and that ‘the EU needs us far more than we need them’. If that was right, then no punishment would have been possible. If it was wrong, then the vote did indeed have consequences embedded within it, consequences which were concealed from voters by the Leave campaign.
It’s not about practical consequences, it’s about philosophical principles
Alongside these five narratives – and perhaps in recognition of their paucity – some Brexiters run a sixth. Here, the attempt is to claim that those who voted leave did so on the basis of a commitment to ‘sovereignty’ in the abstract. So consequences don’t matter, since this was a purely philosophical vote. I can (just about) imagine that this might be true for a few leave voters, though I would argue that they are wrong, but it clearly wasn’t what was proposed to the British people by the Leave campaign, which instead made arguments about immigration and NHS funding, and made claims that leaving would be easy precisely because they knew that if voters thought otherwise then would be disadvantageous to their cause. A pure sovereignty argument would not have needed to make such claims.
As the practical consequences of leaving the EU mount up, and can no longer be dismissed as Project Fear, what Brexiters are trying to do is to counter the argument that ‘no one voted to be poorer’. This is the real meaning of the claim that the vote was about the principle of sovereignty and not practical consequences since, of course, if it was about principles it can be claimed that leave voters accepted that it meant they would get poorer. And it’s probably true that some did. But it certainly isn’t true of the majority of leave voters, even as regards immigration. Yet not only do Brexiters deny this, but some even claim that impoverishment and hardship will be desirable, in some way creating a national renewal by returning to the ‘Dunkirk spirit’. But, again, there are good reasons why this was not put on the side of the Leave campaign bus: almost no one would have voted for it.
Why does this matter?
Precisely because the vote to leave the EU was the beginning of a process – the process of Brexit – rather than the end of something, the way that Brexiters are now attempting to decouple the vote from its consequences is crucial.
Brexiters are trying to use the Referendum vote, close as it was, to mandate as the ‘Will of the People’ anything that they say it means. This is most obviously true in terms of the ‘Global Britain’ agenda of free trade deals around the world. There is much that could be said about that (how does exiting the FTAs that the EU has help it? how does leaving the single market help it?) but, those things aside, how does the Referendum mandate it? For, given that in some, perhaps large, part it was a nativist and protectionist vote it mandates the precise opposite.
In this sense, there is a massive political fraud underway at the moment, and, actually, it isn’t remain voters who are primarily its victims but leave voters. They are being told that their concerns about immigration and globalization are going to be ignored. I happen to think that their concerns about immigration were misplaced and their concerns about globalization irrelevant to the Brexit debate. But I am not so dishonest as to pretend that the vote was not about those things, whereas many Brexiters are.
Thus the day after the Referendum Daniel Hannan said that the Leave campaign “never said there was going to be some radical decline” in immigration, and last March David Davis said that immigration might even rise. Both pretend that all that matters to voters is that Britain decides its own immigration policy – that all they care about is ‘sovereignty’ – rather than actual numbers. As for globalization and free trade, it’s notable that just about every Brexiter now talks as if having an independent trade policy were the main rationale of Brexit. That was mentioned during the Referendum, but it certainly wasn’t presented as the central argument for Brexit – whereas immigration was – and it certainly wasn’t explained that such a trade policy will entail the relaxation of immigration controls.
That is only one aspect of the even greater dishonesty of Brexiters. What they are really trying to argue is that the vote mandates them to do anything they want. That is an even bigger, and even more dubious, proposition than that the Referendum vote set in stone the ‘will of the people’ with respect to EU membership. Precisely because leaving the EU has such far-reaching ramifications not just for economics but for geo-politics, it can be claimed that anything done post-Brexit is mandated by the Referendum result.
So this is where Brexiters are now. All the pre-Referendum swagger has gone, all the promises made have evaporated. In their place are a series of absurd and indefensible arguments. But it is important to understand that these arguments, even if they are often run together, contain two fundamentally different claims. One is that whatever happens now is not the fault of Brexiters. The other is that Brexiters have been given a blank cheque to do whatever they now want to do. These claims are linked in that both treat 23 June 2016 as a frozen moment, denoting either the end of their responsibility for the consequences or the beginning of their freedom to define the consequences. Whilst different, they are linked in their boundless dishonesty, since neither claim was entertained, let alone endorsed, by the Referendum.
But they are also linked in another – probably more important – way. They are profoundly unrealistic. For politics did not stop on 23 June 2016. On the contrary, it began a period of political dislocation that will last for many years, perhaps decades, to come. Brexiters seemed to imagine that by winning the vote that would be an end to it. It’s already obvious that this is not so. If Brexit does go ahead, the Brexiters will, rightly, be held responsible for every consequence that flows from it. That is the significance of the narratives they are already putting forward to deny that the vote had consequences: it’s not simply that they don’t want to take the blame, it’s that they don’t want to take the responsibility.
The ultimate truth about Brexit is that through a series of accidents a protest movement with wholly unrealistic and disastrous policies unexpectedly and unwillingly became a government set upon delivering them. The Brexiters are now running away from the consequences as fast as they can. The tragedy for our country is that, in one way or another, we are stuck with having to deal with them.
It is easy to imagine what they would be saying now if any of these were evident; if companies were announcing new investments because of (not despite) Brexit; if foreign direct investment were booming in anticipation of Brexit, rather than tanking; if countries, especially Commonwealth countries, were champing at the bit to make new trade deals with Britain; if ‘German car companies’ had ‘within minutes of the vote’ to leave demanded a fantastic ‘cake and eat it’ deal and if the EU had rolled over to give it; if the Irish border was unaffected, as Brexiters had claimed it would be; or, even, if the negotiations were proceeding as smoothly and easily as they had promised.
But of course none of those things has happened and so, since winning the Referendum, the Brexiters’ message has changed in a very fundamental way. The new message takes several forms but each has the same dialectical structure: to decouple the vote to leave the EU from the consequences of leaving the EU.
It’s too late now
The first, and simplest, form is that the vote has now been held and so we must just live with the consequences. In that narrative, all debate and discussion ended with the Referendum. Remainers must get over it, leavers must be happy whatever happens. It’s a position exemplified by a recent tweet from the pro-Brexit journalist Julia Hartley-Brewer in response to being sent data about foreign direct investment since Brexit: “Mate, I really don’t care. This question was asked and answered two years ago. Move on with your life”.
Simple as it is, it’s also naïve. Politics doesn’t work like that, as Brexiters should appreciate not least since on the night before the 2016 Referendum Nigel Farage declared otherwise and, on the night after the 1975 Referendum, so did Enoch Powell. In this if in nothing else Enoch, to coin a nasty little phrase, was right.
Not only does politics not work like that in general, but it especially does not work like that in this case because, much as Brexiters dislike it, winning the vote was just the first and easiest part of a process which, in one way or another, will last for years. Hence they make a second claim.
It’s not up to us
The second version is a denial of responsibility, with the central idea being that leave voters and their leaders have done their part simply by delivering the vote to leave. It is up to the politicians and the experts to now make it happen. This, too, is misguided. As I have written elsewhere, their victory was in many ways a disaster for Brexiters in that it meant that they are now responsible for whatever happens. Not just responsible, but uniquely responsible. They were warned over and over again of the consequences and insisted that these warnings were not just wrong but malevolent, self-interested fearmongering. So, now, they and they alone, own the consequences. Remainers have absolutely no responsibility to try to ‘make Brexit work’ or to ‘get behind Brexit’ (whatever those things would mean in practice).
It hasn’t been done properly
That denial of responsibility feeds into the third emerging Brexiter narrative. It is that there was nothing wrong with the decision, but that the way it is being delivered by the government is what is causing the problems. This is evident in, for example, Daniel Hannan’s recent attempt to deflect blame for the policy he advocated for so many decades. It has many variants, from the outright mad (‘we should just have walked away the day after’) to the more sophisticated complaints about specific decisions, such as the timing of the Article 50 notification. It is fair comment that the government have approached Brexit in an inept way, making what the respected (and by no means anti-) Brexit commentator David Allen Green of the Financial Times has called numerous ‘unforced errors’.
Nevertheless, there are two obvious objections. First, that no one – not least the Leave campaigners – has ever specified a way of undertaking Brexit which does not damage the UK, whether economically, politically or strategically. Second, that every mis-step the government have made has been as a result of pressure from, and has been cheered on by, the Brexit Ultras. That includes the dogmatic ‘red lines’ laid down by the government, the premature triggering of Article 50, and, for that matter, the subsequent calling of a General Election to ‘crush the saboteurs’.
This narrative is a familiar one in business, where any and every failed management fad is defended by its advocates on the grounds that all would have been well but for ‘inadequate implementation’. It’s equally familiar in far Left politics, where each failed attempt to implement communism is explained away by saying that it wasn’t ‘proper’ communism.
But in this case it goes further, and links back to the second narrative, in that Brexiters continue to claim victimhood at the hands of the elite, refusing to accept that having won the Referendum and having a government now pursuing what they voted for, they are the elite, and they are the ones implementing Brexit.
It’s the Remainers’ fault
The fourth excuse is that all would have been well but for Remainers who are accused, variously, of sabotage, treachery and of talking Brexit down. Often, it’s a variant of the paranoid idea about the elite – meaning the Civil Service, Judiciary, BBC, CBI, IoD, House of Lords but not, mysteriously, the ex-public schoolboys, millionaires and hedge funds that support Brexit. Sometimes it’s the entire 48% of voters who didn’t back Brexit.
There are daily examples of this claim, but taking just one, that of Leave means Leave co-Chair John Longworth in August 2017, is instructive. The usual suspects are named, in this case for their “pretence” that Britain must pay a “divorce bill” (i.e. settle its outstanding commitments to the EU). But, of course, it wasn’t a Remainer pretence, and four months later the payment was agreed.
The more general issue is that, if Brexit were the self-evidently great idea its proponents claim, it would hardly matter what Remainers did or said. For that matter, within minutes of the vote, before Remainers had had time to engage in any of their nefarious sabotage, Sterling suffered a catastrophic collapse (which in any other circumstances would have led to a political crisis) as the currency markets priced in their prediction of what Brexit would mean.
It’s the EU’s fault
The fifth narrative is possibly the most dominant of the post-Referendum excuses made by Brexiters. It is that the problem was not with the decision to leave, and not solely (or even primarily) with the British government or with Remainers, but with the EU who have decided to ‘punish’ Britain for leaving. Such claims are invariably nonsense since they ascribe to the EU the consequences of having left the EU (and, in this sense, are another denial of responsibility). To take just the most current of numerous examples, Brexiters claim that the border controls, especially in Ireland, are something being threatened by the EU rather than being ineluctable, legal consequences of leaving the single market and any customs union.
There are many things that could be said about this punishment narrative (see here), but the core difficulty with it for Brexiters is that they repeatedly promised that Britain held ‘all the cards’ and that ‘the EU needs us far more than we need them’. If that was right, then no punishment would have been possible. If it was wrong, then the vote did indeed have consequences embedded within it, consequences which were concealed from voters by the Leave campaign.
It’s not about practical consequences, it’s about philosophical principles
Alongside these five narratives – and perhaps in recognition of their paucity – some Brexiters run a sixth. Here, the attempt is to claim that those who voted leave did so on the basis of a commitment to ‘sovereignty’ in the abstract. So consequences don’t matter, since this was a purely philosophical vote. I can (just about) imagine that this might be true for a few leave voters, though I would argue that they are wrong, but it clearly wasn’t what was proposed to the British people by the Leave campaign, which instead made arguments about immigration and NHS funding, and made claims that leaving would be easy precisely because they knew that if voters thought otherwise then would be disadvantageous to their cause. A pure sovereignty argument would not have needed to make such claims.
As the practical consequences of leaving the EU mount up, and can no longer be dismissed as Project Fear, what Brexiters are trying to do is to counter the argument that ‘no one voted to be poorer’. This is the real meaning of the claim that the vote was about the principle of sovereignty and not practical consequences since, of course, if it was about principles it can be claimed that leave voters accepted that it meant they would get poorer. And it’s probably true that some did. But it certainly isn’t true of the majority of leave voters, even as regards immigration. Yet not only do Brexiters deny this, but some even claim that impoverishment and hardship will be desirable, in some way creating a national renewal by returning to the ‘Dunkirk spirit’. But, again, there are good reasons why this was not put on the side of the Leave campaign bus: almost no one would have voted for it.
Why does this matter?
Precisely because the vote to leave the EU was the beginning of a process – the process of Brexit – rather than the end of something, the way that Brexiters are now attempting to decouple the vote from its consequences is crucial.
Brexiters are trying to use the Referendum vote, close as it was, to mandate as the ‘Will of the People’ anything that they say it means. This is most obviously true in terms of the ‘Global Britain’ agenda of free trade deals around the world. There is much that could be said about that (how does exiting the FTAs that the EU has help it? how does leaving the single market help it?) but, those things aside, how does the Referendum mandate it? For, given that in some, perhaps large, part it was a nativist and protectionist vote it mandates the precise opposite.
In this sense, there is a massive political fraud underway at the moment, and, actually, it isn’t remain voters who are primarily its victims but leave voters. They are being told that their concerns about immigration and globalization are going to be ignored. I happen to think that their concerns about immigration were misplaced and their concerns about globalization irrelevant to the Brexit debate. But I am not so dishonest as to pretend that the vote was not about those things, whereas many Brexiters are.
Thus the day after the Referendum Daniel Hannan said that the Leave campaign “never said there was going to be some radical decline” in immigration, and last March David Davis said that immigration might even rise. Both pretend that all that matters to voters is that Britain decides its own immigration policy – that all they care about is ‘sovereignty’ – rather than actual numbers. As for globalization and free trade, it’s notable that just about every Brexiter now talks as if having an independent trade policy were the main rationale of Brexit. That was mentioned during the Referendum, but it certainly wasn’t presented as the central argument for Brexit – whereas immigration was – and it certainly wasn’t explained that such a trade policy will entail the relaxation of immigration controls.
That is only one aspect of the even greater dishonesty of Brexiters. What they are really trying to argue is that the vote mandates them to do anything they want. That is an even bigger, and even more dubious, proposition than that the Referendum vote set in stone the ‘will of the people’ with respect to EU membership. Precisely because leaving the EU has such far-reaching ramifications not just for economics but for geo-politics, it can be claimed that anything done post-Brexit is mandated by the Referendum result.
So this is where Brexiters are now. All the pre-Referendum swagger has gone, all the promises made have evaporated. In their place are a series of absurd and indefensible arguments. But it is important to understand that these arguments, even if they are often run together, contain two fundamentally different claims. One is that whatever happens now is not the fault of Brexiters. The other is that Brexiters have been given a blank cheque to do whatever they now want to do. These claims are linked in that both treat 23 June 2016 as a frozen moment, denoting either the end of their responsibility for the consequences or the beginning of their freedom to define the consequences. Whilst different, they are linked in their boundless dishonesty, since neither claim was entertained, let alone endorsed, by the Referendum.
But they are also linked in another – probably more important – way. They are profoundly unrealistic. For politics did not stop on 23 June 2016. On the contrary, it began a period of political dislocation that will last for many years, perhaps decades, to come. Brexiters seemed to imagine that by winning the vote that would be an end to it. It’s already obvious that this is not so. If Brexit does go ahead, the Brexiters will, rightly, be held responsible for every consequence that flows from it. That is the significance of the narratives they are already putting forward to deny that the vote had consequences: it’s not simply that they don’t want to take the blame, it’s that they don’t want to take the responsibility.
The ultimate truth about Brexit is that through a series of accidents a protest movement with wholly unrealistic and disastrous policies unexpectedly and unwillingly became a government set upon delivering them. The Brexiters are now running away from the consequences as fast as they can. The tragedy for our country is that, in one way or another, we are stuck with having to deal with them.
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