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| Reject the chancers and their fantasy visions of post-Brexit trade | Reject the chancers and their fantasy visions of post-Brexit trade |
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| You can pick your own metaphor, for there are plenty to choose from. Falling apart like a chocolate orange was the auditor general’s image of choice today. You may prefer collapsing like a house of cards, wheels coming off the wagon, wickets tumbling like an England batting collapse, and many others. Any of them would now serve to describe what appears to be the potentially terminal unravelling of Theresa May’s Brexit strategy one year after she became prime minister. | You can pick your own metaphor, for there are plenty to choose from. Falling apart like a chocolate orange was the auditor general’s image of choice today. You may prefer collapsing like a house of cards, wheels coming off the wagon, wickets tumbling like an England batting collapse, and many others. Any of them would now serve to describe what appears to be the potentially terminal unravelling of Theresa May’s Brexit strategy one year after she became prime minister. |
| It’s not one part of the strategy that is now under pressure. Increasingly it’s every part, home and abroad, present and future, each impacting the other in the way that happens if politics spins out of control. The publication of the repeal bill – no longer “great”, just long, complex and unwinding – shows how the domestic political context of Brexit is shifting. A year ago, the two main parties were united in their need to pay homage to the Brexit vote. Now Labour’s six conditions that must be satisfied before the bill can go ahead show the sharp stiffening of the oppositional impulse, while the Tory party is split every which way on Brexit, as the select committee elections showed this week. | It’s not one part of the strategy that is now under pressure. Increasingly it’s every part, home and abroad, present and future, each impacting the other in the way that happens if politics spins out of control. The publication of the repeal bill – no longer “great”, just long, complex and unwinding – shows how the domestic political context of Brexit is shifting. A year ago, the two main parties were united in their need to pay homage to the Brexit vote. Now Labour’s six conditions that must be satisfied before the bill can go ahead show the sharp stiffening of the oppositional impulse, while the Tory party is split every which way on Brexit, as the select committee elections showed this week. |
| The negotiations with Europe are an increasingly embarrassing mess too. In Brussels, Michel Barnier leads an organised, rational team of negotiators whose professionalism is a credit to the system. Meanwhile in London, amateurs, ideologues and chancers rule. No one can really say what the Brexit policy is. Three government papers published on Thursday are as clear as mud. May is too weak to stop the hand-to-hand wrestling for control of the policy between David Davis and the increasingly assertive Philip Hammond. And everything is complicated by the leadership manoeuvring for the post-May era. | The negotiations with Europe are an increasingly embarrassing mess too. In Brussels, Michel Barnier leads an organised, rational team of negotiators whose professionalism is a credit to the system. Meanwhile in London, amateurs, ideologues and chancers rule. No one can really say what the Brexit policy is. Three government papers published on Thursday are as clear as mud. May is too weak to stop the hand-to-hand wrestling for control of the policy between David Davis and the increasingly assertive Philip Hammond. And everything is complicated by the leadership manoeuvring for the post-May era. |
| As is her way, May continues to repeat her Brexit mantras. She is getting on with the job, working to get a good deal, always talking as if the outcome is certain. But it’s not certain at all. The lack of detail is persistent and has become disabling. May remains an optimist on Brexit, but close observers think even she makes the fatal mistake that sank David Cameron, of thinking all this can ultimately be sorted between politicians. Boris Johnson lazily makes the same error. Davis is full of prejudices and self-confidence too, but his remark that Brexit was as complex as ensuring a safe moon landing may show he is learning. | As is her way, May continues to repeat her Brexit mantras. She is getting on with the job, working to get a good deal, always talking as if the outcome is certain. But it’s not certain at all. The lack of detail is persistent and has become disabling. May remains an optimist on Brexit, but close observers think even she makes the fatal mistake that sank David Cameron, of thinking all this can ultimately be sorted between politicians. Boris Johnson lazily makes the same error. Davis is full of prejudices and self-confidence too, but his remark that Brexit was as complex as ensuring a safe moon landing may show he is learning. |
| There’s a systemic issue here. It’s not just a question of personal skills and training. “Someone has to tell the PM that the UK system does not grasp where things are,” says one Brussels hand. “Barnier and Donald Tusk should fly unannounced and unreported to Chequers this weekend and sit down with May and DD and have the right private conversations.” | There’s a systemic issue here. It’s not just a question of personal skills and training. “Someone has to tell the PM that the UK system does not grasp where things are,” says one Brussels hand. “Barnier and Donald Tusk should fly unannounced and unreported to Chequers this weekend and sit down with May and DD and have the right private conversations.” |
| Things are moving fast, as Barnier made clear this week. Yet the government’s reluctance to take a strategic approach, terrified by the destructive internal Tory politics, means decisions are being endlessly put off. The Liberal Democrats had a poor election, but suddenly they aren’t the only ones speculating that Britain may end up not exiting after all. Don’t worry, we’re not leaving the EU, a former cabinet minister messaged me last weekend. Premature, in my view, but the possibility is on the table now in a way that it wasn’t before. | Things are moving fast, as Barnier made clear this week. Yet the government’s reluctance to take a strategic approach, terrified by the destructive internal Tory politics, means decisions are being endlessly put off. The Liberal Democrats had a poor election, but suddenly they aren’t the only ones speculating that Britain may end up not exiting after all. Don’t worry, we’re not leaving the EU, a former cabinet minister messaged me last weekend. Premature, in my view, but the possibility is on the table now in a way that it wasn’t before. |
| May is trapped by the toxic politics that put her into office a year ago and the growing realisation that Brexit is heading to be an economic and diplomatic disaster for Britain. Her essential stance in the election was that the country should rally behind her Brexit strategy. The country demurred. She still has not faced what this means. It means she has to reconfigure Brexit and go for a Norway-style transitional deal inside the European Economic Area (EEA), with the European court of justice remaining a central part of the arbitration system. If she won’t do that, she risks being deposed. | May is trapped by the toxic politics that put her into office a year ago and the growing realisation that Brexit is heading to be an economic and diplomatic disaster for Britain. Her essential stance in the election was that the country should rally behind her Brexit strategy. The country demurred. She still has not faced what this means. It means she has to reconfigure Brexit and go for a Norway-style transitional deal inside the European Economic Area (EEA), with the European court of justice remaining a central part of the arbitration system. If she won’t do that, she risks being deposed. |
| Yet still the fantasy goes on, nowhere more so than on trade. Last autumn the Treasury produced an unpublished internal paper that concluded that the costs of hard Brexit far outweighed any potential gains from Liam Fox’s free trade agreement strategy. The idea that 20 to 30 bilateral agreements could compensate for the losses of Brexit was idle thinking, it said. Hammond, who thinks Fox is a fantasist, told the cabinet that the costs were too high. Elsewhere in government, fact-free denial of these realities still reigns. | Yet still the fantasy goes on, nowhere more so than on trade. Last autumn the Treasury produced an unpublished internal paper that concluded that the costs of hard Brexit far outweighed any potential gains from Liam Fox’s free trade agreement strategy. The idea that 20 to 30 bilateral agreements could compensate for the losses of Brexit was idle thinking, it said. Hammond, who thinks Fox is a fantasist, told the cabinet that the costs were too high. Elsewhere in government, fact-free denial of these realities still reigns. |
| How much longer can this deception of self as well as nation continue? In Hamburg a week ago Donald Trump offered Britain a “very, very big”, “very powerful” trade deal “very, very quickly”. This week Australia’s Malcolm Turnbull said something equivalent, though with less bombast. But these deals are not theirs to enact. Trump doesn’t have authority to fast track. Trade deals can’t be switched on like a light. They take years to negotiate and then to come on stream. | How much longer can this deception of self as well as nation continue? In Hamburg a week ago Donald Trump offered Britain a “very, very big”, “very powerful” trade deal “very, very quickly”. This week Australia’s Malcolm Turnbull said something equivalent, though with less bombast. But these deals are not theirs to enact. Trump doesn’t have authority to fast track. Trade deals can’t be switched on like a light. They take years to negotiate and then to come on stream. |
| And trade talks are cold-hearted affairs. They aren’t about favours to foreign friends. On the contrary. They are about gaining market access for domestic producers. They are conducted by nerds, not politicians. Since the UK has a trade surplus with the US, any deal there will be about the UK making concessions to the US, not the other way round. In trade, geography is overwhelmingly the key. Big countries and players – the US, China and the EU – have more cards than small ones. Outside the EU, Britain is a small country. As the CIA world factbook unsentimentally puts it, the UK is “slightly smaller than Oregon”. | And trade talks are cold-hearted affairs. They aren’t about favours to foreign friends. On the contrary. They are about gaining market access for domestic producers. They are conducted by nerds, not politicians. Since the UK has a trade surplus with the US, any deal there will be about the UK making concessions to the US, not the other way round. In trade, geography is overwhelmingly the key. Big countries and players – the US, China and the EU – have more cards than small ones. Outside the EU, Britain is a small country. As the CIA world factbook unsentimentally puts it, the UK is “slightly smaller than Oregon”. |
| Geography means that most of the UK’s main trading partners are in Europe, and are members of the EU and the EEA. The trade partners that matter are places like Germany, the Netherlands, Belgium, France, Norway and Ireland. Our prosperity is linked to them and any rational statecraft would seek to preserve that, Brexit or not. Forget New Zealand. Spectacular scenery, great at rugby, but way, way down the list on trade – and anyway its aim in a bilateral deal would be to kill the Welsh lamb industry. | Geography means that most of the UK’s main trading partners are in Europe, and are members of the EU and the EEA. The trade partners that matter are places like Germany, the Netherlands, Belgium, France, Norway and Ireland. Our prosperity is linked to them and any rational statecraft would seek to preserve that, Brexit or not. Forget New Zealand. Spectacular scenery, great at rugby, but way, way down the list on trade – and anyway its aim in a bilateral deal would be to kill the Welsh lamb industry. |
| It isn’t too late to face reality. But with real wages falling in the UK, businesses beginning to relocate, the government unpopular and the clock ticking, it soon could be. So far, the signs are that the EU is still being patient with Britain, open to practical deals. But they will only come if Britain wants them too. Many in the Tory party do not. May could be tempted to defer to the right, perhaps even by staging a confrontation with the EU to see her through the party conference unscathed. But if she won’t take on the Tory right, then parliament must do so: let the chocolate orange pieces and the prime minister’s tears fall where they may. | It isn’t too late to face reality. But with real wages falling in the UK, businesses beginning to relocate, the government unpopular and the clock ticking, it soon could be. So far, the signs are that the EU is still being patient with Britain, open to practical deals. But they will only come if Britain wants them too. Many in the Tory party do not. May could be tempted to defer to the right, perhaps even by staging a confrontation with the EU to see her through the party conference unscathed. But if she won’t take on the Tory right, then parliament must do so: let the chocolate orange pieces and the prime minister’s tears fall where they may. |
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