Monday, 9 January 2017

The May Delusion

This is a quote attributed to Theresa May in the Telegraph today:
"Well, I’m tempted to say the people who are getting it wrong are those who print things saying I’m talking about a “hard” Brexit, “it’s absolutely inevitable it’s a hard Brexit”. I don’t accept the terms “hard” or “soft” Brexit. What we are doing is going to get an ambitious, good, the best possible deal for the United Kingdom in terms of trading with, and operating within, the single European market. But it will be a new relationship because we won’t be members of the EU any longer. We will be outside the European Union, and therefore we will be negotiating a new relationship, across not just trading but other areas, with the European Union."
The media morons call this hard Brexit. It isn't. Clearly Mrs May is seeking a comprehensive negotiated settlement. Whether she understands how sophisticated that must be is unclear but by now she will have at least a vague inclination that there is more to it than one might superficially expect. 

What is up for debate is what she means by "the best possible deal for the United Kingdom in terms of trading with, and operating within, the single European market". If that is not the EEA then what? It is more comprehensive than the Swiss arrangement, more flexible and the closest one can get to being an EU member without actually being subordinate to it.

Given the circumstances of our predicament any new relationship would necessarily require something equally comprehensive if only for the interim. What she is effectively hinting at though is that the EEA is not good enough for Britain and she intends to drag the EU through the process of negotiating yet another mammoth comprehensive agreement similar to one which already exists. Why on earth would the EU be in any great hurry to do that?

The one reason I can imagine they would make space for such an endeavour is if they saw an opportunity to rob the UK of a number of economic assets. It would be foolish to open up any such protracted negotiations given what we stand to lose. That though carries risks for the EU as well as we enter a long period of uncertainty. The EEA took eight years to negotiate. It is unlikely any bespoke agreement would come any sooner unless it was a mirror of it - in which case, why bother at all?

It seems that unless Mrs May realises that the EEA is her only real option before triggering Article 50, she will likely have to confront that reality later down the line. It will create an embarrassing mess for her and politically she will lose face. She will make a real pigs ear of it, but whatever the media insists on calling it, it won't be "hard Brexit". It will be a bungled mess she could have avoided from the outset - and our economy will once again be at the mercy of the markets as the media fails to comprehend what is happening. She will risk accidental Brexit but in the end will be forced to climb down and accept that Britain is presently in no shape to pull out of the single market. We will pay dearly for her incomprehension. 

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