Tuesday, 3 March 2020

Smoke and mirrors

As a rule I ignore columnists, especially Guardian ones, but I don't mind Rafael Behr all that much. In yesterday's piece he's got Cummings's number.
The Johnson-Frost doctrine rejects the Treasury view that disrupting trade between neighbours makes them poorer. Costs are outweighed by “other factors” intrinsic to the “complex and adaptive” nature of the modern economy, which in its unfathomable genius generates responses “we do not foresee” and “solutions we did not expect”. This hints at the view, championed in Downing Street by Dominic Cummings, that fretting about EU markets is for analogue scaredy cats who care too much about gravity and not enough about the weightless digital future. Farmers bleat about borders, but the 21st century belongs to countries that master artificial intelligence. The thesis is immune to evidence and too nebulous to be disproved in the time available for Brexit negotiations. It allows believers to write off any short-term disruption against notional gains down the line.
On this blog I've tried to keep things grounded in reality, though I have at times tried to look for alternative approaches and new avenues that could present opportunities for the UK. I've not knowingly misled, though I may have overemphasised. There's a certain amount of creative spin when trying to be persuasive. Consequently, I know bullshit when I see it.

I have previously argued that the gravity model was more of a guide than a rule and that it tends to apply mainly to goods, but further reading shows that services still largely conform to the rule. There are exceptions but that weightless digital future is overstated. There's geographic gravity and then there's language gravity.

But even if that were not the case, it is not, as Cummings believes, virgin territory. The digital frontier is not divorced from other modes of trade. The same familiar themes emerge - intellectual property, data protection, e-commerce, trade facilitation, regulatory harmonisation and standards. There is even a high degree of digital protectionism which is difficult to combat and difficult to prove.

Cummings believes that the stodgy old EU is a dinosaur protecting its physical markets, while being left behind in a hi-tech space race. But he's wrong. Far from being virgin territory, it's very much EU occupied territory. In the digital tech space race the EU is well ahead of the game in terms of regulation and standards, working toward the digital single market where again, if the UK wants to participate in lucrative markets, the UK will find itself a "rule taker".

But with the trade debate having obsessed over tariffs and borders, and most people's perception of trade being lorries moving tins of beans on Ro-Ro ferries, this stuff doesn't get a look in, so flim-flam artists like Cummings and Singham can fill the airwaves with baseless bloviation. With the Telegraph and Spectator convinced of their genius, they are all to happy to retail this smoke and mirrors campaign - and their readers are all to happy to believe it. They then have the ground cover to ignore all the warnings. There is nothing quite so malleable as a Tory hearing what they want to hear.

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