Monday, 31 July 2017

Light blogging

A kind and generous soul has taken pity on me and is taking me on holiday. Will be back in a few days with both guns blazing.

Sunday, 30 July 2017

The dark side of Tory Brexit

The following post is reproduced in full from

According to its website, it was set up in 2009, but it does not seem to have been fully funded until recently. The Charity Commission records that the registered charity, the Legatum Institute Foundation, received over £4 million in income in 2015 - up from just under £3 million in 2014 and a mere £2,500 in 2013.

The Foundation is registered with Company House as a company limited by guarantee. But, according to the 2015 accounts (submitted to the Charity Commissioners in October 2016), the bulk of its income comes from the Legatum Foundation Limited, a company registered in Bermuda.

The Bermuda company in turn is controlled by the Institute's parent undertakings. One is the Legatum Institute, a company registered in the Cayman Islands. Its three current directors give their addresses as Convection Tower, Dubai Convention Centre, in the UAE. The ultimate parent undertaking is the Legatum Partnership LLP, a limited liability partnership registered in Jersey.

The Institute itself is part of the Legatum Group, set up in 2006 by the multi-billionaire Christopher Chandler, formerly president of Sovereign Asset Management. This came after a demerger of the family business, Sovereign Global, managed with his brother Richard Chandler. Both New Zealand born, Richard Chandler is resident in Singapore. The Legatum business is based in Dubai.

In the 2015 report to the Charity Commissioners, senior management personnel of the Legatum Institute were listed as Anne Applebaum, Giles Dilnot, Alexandra Mousavizadeh, former newspaper columnist Christina Odone and Shanker Singham, the latter acting as chairman of the Institute's Special Trade Commission, fronting most of the Brexit propaganda.

Applebaum is firmly on the political right, having been an adjunct fellow of the American Enterprise Institute. She has an extensive career as a journalist, working for the Washington Post, the Daily and Sunday Telegraph and the Economist. She was deputy editor of the Spectator and political editor for the Evening Standard. However, she resigned in 2016, having disagreed with the director over the Institute's support for Brexit. She now works for the LSE.

Currently top of the hierarchy is Philippa Stroud, CEO of the Institute. Previously. She used to be Chief Executive of the Centre for Social Justice (CSJ), a think tank that she co-founded in 2004. Prior to the CSJ, she was Special Adviser the Rt. Hon. Iain Duncan Smith MP (then Secretary of State for Work and Pensions) from 2010-15.

One of the directors is Toby Baxendale. He is also on its board of trustees. As to other interests, he was director, alongside co-director Steve Baker, of the now defunct Leadsom4Leader, a limited company set up to support Andrea Leadsom's Conservative Party leadership bid.

Baxendale is also co-founder, again with Steve Baker, of the Cobden Centre, "a home for Austrian School economics in the UK". He also set up the Hayek Visiting Fellowship at the London School of Economics. He has also been a significant donor to the Conservative Party.

The links with the Cobden Centre bring us to Perry de Haviland, supposedly independent editor of the Samizdata blog, Matthew Elliott, who just happens to be a senior fellow of the Legatum Institute.

Elliott, founder of the Taxpayers Alliance and one-time director of Vote Leave, sits with another Legatum senior fellow Tim Montgomerie, founding editor of Conservative Home and former Timescolumnist. At the Cobden Centre, he sits on the Advisory Board with Sam Bowman, research director of the Adam Smith Institute, Ewen Stewart – a managing board member of the Freedom Association - and Douglas Carswell.

Yet another senior fellow Legatum Institute is Danny Kruger, former chief speechwriter to David Cameron, chief leader writer at The Daily Telegraph, and director of research at the Centre for Policy Studies.

Listed as a fellow, along with many others one also finds Graeme Leach, founder and chief economist of Macronomics, a macroeconomic, geopolitical and future megatrends research consultancy he launched in 2016. He is a visiting professor of economic policy, a member of the IEA Shadow Monetary Policy Committee and has a weekly column in the City AM newspaper. Between 1997 and 2013 he worked as Chief Economist and Director of Policy at the Institute of Directors (IoD), where he was also a main board director.

A trustee of Legatum is Richard Briance, the Chairman of PMB Capital Limited, a newly formed merchant banking business and former Chief Executive of Edmond de Rothschild Ltd. Before that, he had been Managing Director of Credit Suisse First Boston Ltd, Vice-Chairman at UBS Ltd and Chief Executive of West Merchant Bank Ltd.

In terms of his other political activities, Briance was a Non-Executive Director at Oxford Analytica from 1999-2010 and he has been a trustee of Policy Exchange.

One of the key figures in the Policy Exchange was Lord (James) O'Shaughnessy, formerly Deputy Director. He then worked for the Prime Minister, David Cameron, as his Director of Policy between 2010 and 2011 and for three years (2007-2010) worked in the Conservative Party as Director of Policy and Research. He has now become a senior fellow at the Legatum Institute.

In October 2016, The Legatum Institute sponsored a report called The Road to Brexit. The foreword was by Duncan Smith, Philippa Stroud's former boss. Also writing for the report were the MPs John Redwood, Peter Lilley, Owen Paterson and Bernard Jenkin – leading members of the "Ultras".

As well as Shanker Singham, there were two other authors, Sheila Lawlor and James Arnell. Lawlor directs the economic, education, constitutional and social policy programmes of think tank Politeia while Arnell is a partner as Charterhouse, displaying ultra views on Brexit.

The picture one gets of Legatum, therefore, is of an exceptionally well-endowed think-tank with fingers in many pies and strongly networked with other think-tanks and the media. With offshore finance, though, this is redolent of foreign interference in UK politics, by a company which seems to attract dubious publicity, and critical appraisal.

The greatest concern, though, comes from reading the Legatum website. Having invested heavily in Russia and developing countries, the business speciality is moving into markets at times of crisis where assets are mispriced. With an eye for emerging trends and undervalued assets, it invested heavily in the telecommunications sector in Brazil, just after the country emerged from hyperinflation. It describes its own "investment heritage" in navigating through choppy markets, following the great financial crisis.

The company takes great pride in its investments in Hong Kong real estate, a market which investors had fled after the signing of the Sino-British Accord, an agreement that promised to give Hong Kong back to the Chinese government. It saw assets mispriced, and noted that "opportunities arise in times of crisis".

This is a business style which has been described as "disaster capitalism", which would benefit significantly from a hard Brexit. Here, a comparison could be made with Hong Kong, where a similar situation might arise in a UK under the stress of a hard Brexit, where many traditional firms have run for cover, or relocated in the EU, leaving many assets under-priced.

Looking also for opportunities arising from deregulation and further privatisation – especially in the NHS, with Legatum having considerable healthcare interests – hard Brexit presents multiple opportunities. This, after all, is a business that openly states that it "finds value where disruptive transitions create unique opportunities".

In this, the Legatum Institute seems to be paving the way for its "parent undertakings", engineering a "disruptive transition" for Brexit, then to reap the profits from chaos. Its task is assisted by useful fools and fellow travellers on the Tory right. What we have often characterised as incompetence, therefore, may be more sinister. There is money to be made out of a hard Brexit.

Tinkering with tariffs is no salvation

Some will be wondering why the frequency of posts on this blog have dropped off. Being it silly season and virtually bugger all to report on, one feel less obliged than others to fill space. I am instead hitting the books. There is no point trying to cut through the Brexit noise. There is now a wealth of knowledge on Brexit in the public domain for our politicians to ignore - and restating points is becoming tiresome and robotic.

Instead I think it more valuable, for moment, to look at some of the challenges ahead for trade policy post-Brexit. As readers of this blog will be aware, I am hugely sceptical of what new FTAs can achieve and there are ways, through existing channels, that we can enhance existing value chains. That brings us to this report from the International Trade Centre.
Kenyan avocado farmers traditionally sell their fruits directly to local brokers. These brokers then sell them on to domestic exporting companies. These firms, many of which are small or medium-sized, in turn sell the avocados to international trading companies operating out of the port city of Mombasa. Only then are the avocados shipped abroad, destined for supermarket shelves.

Farmers sell to brokers on a one-off basis, often at low prices. The general absence of enduring, multi-year relationships with purchasers means that farmers are left with little understanding about market requirements wherever their avocados might end up. Farmers therefore have little incentive to invest in greater quality, nor do they get financial support to do so.

This business model has downsides for SME exporters too. Because the fruit that they purchase from brokers is often of middling quality, they can only sell into lower-value markets or market segments in Asia, Europe and the Middle East. And since these firms do not have a direct link to farmers, they cannot easily invest in improved production methods.

To tap into the most lucrative market niches – such as major European supermarket chains – avocados need to be formally certified for quality. The most prevalent certification for the European market is a private standard called GLOBALG.A.P., which sets out requirements for farming processes and food safety. Complying – and proving compliance – with the requirements of such standards requires farmers and companies to spend time and money. Obtaining GLOBALG.A.P certification, however, opens doors for Kenyan SMEs to build long-lasting relationships with trading firms that sell to higher-end retailers in Europe and offer consistently higher prices.
This adds further weight to the overall consensus that the EU diverts a large amount of trade. The barriers to trade are structural. Brexiteers often cite "punitive" tariffs on third world exporters, but tariffs are really not the issue. Remainers, however, have got things wrong too. They would cite the EU's Everything But Arms Agreement, which is an argument I also like to deploy just to rattle the cages of ultra-Brexiteers, but it is far from the full picture. For starters, Kenya, for example, is not a Least Developed Country.

One of the talking points of the week has been tariffs on coffee - but one should always be cautious when looking at any headline tariffs in that there are a web of exceptions and special rules where you'd have to do a far more in depth analysis to get the full picture.

The International Coffee Organisation says that "Tariffs in importing countries have been steadily reduced through multilateral, regional and bilateral trade arrangements, and many developing countries now benefit from duty‐free access to major markets. This access is not uniformly granted, though, and some countries benefit more than others, creating an unequal trading system. Furthermore, tariff escalation on roasted coffee is a real concern for exporters, as it discourages value addition and protects domestic industries in consumer countries. Higher taxes on processed products, such as roasted, decaffeinated or soluble coffee increase dependence on raw commodity exports by developing countries and impede diversification".

So while tariffs are worthy of examination, it would appear there is more scope for restructuring supply chains and using our aid budget to invest in quality systems in partner countries. This has to happen in tandem with trade facilitation measures on customs cooperation. This is where Codex Alimentarius does some excellent work. These such initiatives are what the UK needs to be financing. Codex is limited by budgetary constraints.

This is something trade wonks tend to ignore in that their fullest exposure to Codex is its relationship to WTO SPS measures - being largely ignorant of the scale and scope of Codex. Since trade wonks tend to obsess about US trade, the significance of Codex worldwide is misunderstood and underestimated.

But then what is also needed is some considerable business expertise working to reform the structural problems in African markets. Returning to avocados, the ITC found that "In 2014, when the [ITC] project started, the Kenyan avocado exporters associated with the project reported exports totalling 6,143 tons. This figure reached 9,334 tons the following year and 12,141 tons in 2016, representing a 98% increase over the two-year period. Thanks to the new business connections with international trading firms facilitated by the project, SMEs reported 90 new orders during that time, mainly from traders selling into the European market. Higher sales have meant greater job creation at the companies as they hired 49 permanent and 508 casual workers in 2016, a 128% increase from the year before.

This is where domestic efforts can also help. For reasons that escape me, avocados have become a hipster superfood for London's well-to-do. I'm quite sure this is not by accident. Marketing companies are perfectly capable of stimulating demands for all manner of obscure luxury products. A similar effort on Afghan pomegranates probably wouldn't go amiss. It's more profitable than poppy - hence why trade is also a foreign policy tool.

The obvious advantage to this is that British importers get a larger say in the processes and consequently any technical areas for improvement presents an opportunity for UK business to business services.

This is where the Department of International Trade needs to get busy identifying those opportunities and advertising them. It should be using DfID as its special projects arm, inviting business specialists into the process. We also need agricultural specialists looking at the problems. If we are exporting quality system it follows there will be a market for grading machines and agricultural robotics.

If the UK wants to enhance trade then it will have to do more than simply tinker with tariffs. It will have to invest and build up institutional expertise - and considerably beef up our diplomatic resources. In some respects we are already committed to this but there is a disconnect between the DIT and DfID, and though what we are engaged in is good, we need to do considerably more of it. We have a number of projects running concurrently but there is no apparent cohesive strategy.

As much as this is key to our commercial interests it should also be a cornerstone of our overall foreign policy, an objective of which is slowing the rate of migration. Commercial hubs in Africa have their own gravitational pull so it is in our best interests to stimulate jobs and growth wherever we can - and that means building up a global consensus to end a number of destructive EU trade policies.

There seems to be a complacency among Tory free trade proponents that all we need do is sign a few pieces of paper to get the trucks rolling. Evidence tends to suggest that the elimination of tariffs alone still doesn't stimulate trade. It's going to take a much more active foreign policy and a lot of investment. This is why we should be cautious of populists like Rees-Mogg who talk up the merits of raiding the aid budget for domestic spending. It takes money to make money and we cannot take anything for granted.

Thursday, 27 July 2017

Rethinking trade is now a matter of urgency

Twitter is an ecosystem of concentric bubbles each tailored to the individual by the individual. Mine is made up largely of maritime affairs, aviation, international trade, politics and UK diplomacy. Just like any playground it has its in crowds and social dynamics. To a large extent it's a series of self-congratulatory cliques where everybody tells each other how marvellous they are. It's not game I play. I'm not in this to make friends or have my ego flattered. My mission is to learn as much as I can, to teach as much as I can, and call it how I see it.  

In this I am often told I need to be more polite and less abrasive. That isn't going to happen. There are a lot of people participating in this with questionable motives, playing a deeply dishonest game. I am told to play the issues not the man, but the men (and women) in this game are part of the problem. As much as anything it is the politeness causing the difficulty. People like Hannan and Lilico are superficial, lying simpletons playing a dangerous game with the future of the country. All the while the Conservative Home and Brexit Central crowd are reckless zealots - and they too are lying through their teeth. It needs to be called out without fear or hesitation. 

But it's not just the Brexiteers. You have the Ian Dunts and David Alan Greens of this world; self-serving manipulators building a little dung heap of adoring fans for their own gratification - and will knowingly distort the facts in order to titillate and massage a narrative. Both expert manipulators preaching to a gullible audience. Then there are the parasites like Alan Beattie of the FT. People who will raid the work of others but misframe it, omitting inconvenient key details.

There are then the cheats like Shanker Singham and Lorand Bartels. People using their respective institutional prestige to pass themselves off as oracles. Lorand Bartels is a typical one in that he thinks his small piece of the puzzle is the whole picture. His book on regional trade agreements in the WTO system is second to none - and one that hasn't left my desk in weeks, yet still, bizarrely doesn't know what customs cooperation is and tells us that "most countries trade on WTO rules". An expert on WTO law he may be, but he knows nothing at all about the functioning of the EU and its trade relationships. We must be wise to these charlatans.

Then there's the trade wonks. Nice enough people with genuine motives, but ultimately trapped in a single paradigm. From what I can discern, most of them cut their teeth debating TTIP which couldn't be less relevant to the central issue of Brexit. Ultimately these people are mechanics. Practitioners who can achieve when properly tasked, however, are only useful in a very narrow field and they do not see the bigger picture. They are one trick ponies.

What's missing firstly is a sense of urgency and the ability to prioritise. I could sit and chat with these people about trade all day and soak up everything they know. They are an important resource. But the task at hand is not new FTAs. What we are looking at in the context of Brexit is the overall relationship with the EU along with the engineering task of carrying over existing trade arrangements with third countries.

As you know, my position on Brexit is that if we're not looking at the EEA then there is simply no chance of Brexit being anything other than a shambles. As to carrying over EU trade deals, that's a tasks separate to negotiating FTAs and a wholly different undertaking - one which will inform our trade strategy after we leave.

Trade wonks are used to the idea of approaching FTAs from a clean slate or enhancing that which already exists. This is why they love nattering about TTIP more than anything. They are comfortable with what they know and will rinse it for all it is worth. As a dog returns to his vomit. Brexit, however, is a different kind of engineering that doesn't require all that much negotiation - just a nod of approval on a series of questions.

In breaking out of the customs union we are having to adopt EU schedules and quotas. I have only a working understanding of the specifics and not for a moment would I claim any expertise. What we can say though is that any subsequent customs agreement with the EU will likely mean that we are pegged to the EU tariff regime for the foreseeable future. It has to be this way because it's the only way to manage the administrative task of carrying over third country agreements without substantial renegotiation. Since we cannot do it all at once, reconfiguring all of our trade relationships, Brexit is the process of engineering our way out of the EU on paper to get us to a point where we can renegotiate agreements at a time where we can give it sufficient attention and prioritise them.

In fact, that should be the easy bit. Where it gets complex is in the non tariff category. And I'm not talking about regulatory barriers. When you look at an EU trade agreement there is no common model. They evolve over time and each agreement in its own right acquires its own distinct characteristics, be they variations in the dispute resolution system or specialist areas of cooperation like narcotics control or renewable energy. These are cooperation agreements bringing into being a number of joint committees and funding programmes.

Many of these will be administered by EU agencies - so how this works is going to be largely dependent on the level of our continued involvement and whether we share the same foreign policy and trade goals as the EU. Continuity is going to depend a lot on what the final agreement looks like.

In more recent FTAs like Singapore or the EU-Japan agreement currently under way, these are more geared toward regulatory cooperation, effectively giving binding effect to the WTO TBT agreement - and in so doing pulling international organisations like Codex and UNECE into the mix. This means that if we wish to continue these such cooperation efforts we will either have to do it in partnership with the EU or diagonally. What it will mean though is maintaining the single market acquis whether we are members or not. That actually points to the futility of leaving the single market.

But that then brings us to the question of what we do when the process is complete. When our tariffs will be bound and for the most part pegged to the CET, while maintaining a high degree of regulatory convergence with the EU, there actually isn't all that much scope for comprehensive FTAs. They cannot happen in isolation of what partners have already committed to with the EU.

In order to ascertain our trade potential we need to examine Norway in that it is similarly bound to the EU. As I understand it, having undertaken only a cursory investigation, Norway does have a series of mutual recognition agreements on a number of specialist areas - and usually in those markets where it has little EU integration so as not to destabilise EU trade. Britain is going to have to do likewise in those sectors where the balance of trade favours the rest of the world rather than Europe. I cannot say what those will be and I will defer to the wonks on that. That's what they are for.

But what we also see is a high level of activity between Norway and a number of non-state actors on the world stage where it favours research and cooperation agreements and MoUs with global alliances and standards bodies. As this blog has outlined, tinkering with tariffs can get you so far but finding practical solutions to problems that blight existing supply chains can have an equal or greater effect on trade. Committing scientific resources to resolve a fruit fly problem can increase crop yields - and beefing up LDC customs can help eliminate billions in fraud and counterfeiting.

Then there is participation in the standards bodies and global regulators. Again this s something the trade wonks have a distinct blind spot for. We have no shortage of trade wonks who can tell us how things work at the WTO and how the internal politics works but as yet I haven't come across anybody who comments on Brexit who has sat in the International Maritime Organisation or endured a boring seminar on aubergine marketing standards at Codex. The WTO is the more glamorous field which attracts the bulk of intellectual investment. We consequently have a knowledge imbalance.

This is actually a problem because the key initiative for the WTO, around which most of its present efforts are devoted, is the TBT agreement and the TFA. Crucial to this is the development and installation of new standards - which is something the WTO does not do. In this the WTO grants delegated authority to the ISO and IEC along with OIE, IPPC and Codex, all of which have close cooperation with UNECE where we start to see the emergence of a privatised system of regulation interacting with the UN ecosystem.

Much of this is off radar because it's just not that sexy. Who goes into trade politics to discuss the maximum permitted level of grain fungus? But actually, that is fundamentally what trade is now about, where the key negotiations happen, which are every bit as significant as a tariff negotiations. There are inherent savings to be had by establishing common rules and just a standard on tyres or pharmaceutical labelling can add substantial improvements to value chains.

No doubt Britain will find room for FTAs but the point is that it's the big players who will accomplish the most with FTAs and we are better off leaving the EU to it, negotiating proxy access to these such deals while taking a more active and agile role in the formation of standards and regulations.

As this blog has repeatedly discussed, comprehensive FTAs tie up substantial resources, take several years and can often fall at the last hurdle. Britain can't afford to play that game nor can we identify any easy wins because many of our preferred partners are already engaged in EU talks that will bind them in respect of what they can give the UK.

What Britain does have in the post-Brexit world is the right of proposal at the international level without having to clear regulatory initiatives with Brussels. In this we are not without allies - and we have assets such as British Standards who are still said to be a superpower in the standards ecosystem. I'm not sure how true that is but it is influential and respected. We need to make a national priority of making sure it stays that way.

Ultimately, at this level, all the general rules cease to apply. It's not your market size, rather it is your level of participation and what expertise you can bring to the table. This is why waffle about The Brussels Effect is not especially useful.

What we tend to find is that the ability to influence regulation and standards comes from being in on it from the start with world-wide initiatives, having a solid network of intelligence inside foreign standards bodies. The USA especially. If there is anything at all to be gained from talks with the USA it is enhanced cooperation with ANSI and ASTM - hopefully with a view to persuading the USA to bring more coherence to its standards sector. It is presently deeply fragmented and unable to offer a united view.

Ultimately we will have to look beyond FTAs and play a much more savvy game seeking to pioneer regulatory initiatives with a clarity of purpose the EU struggles to bring to bear. That, though, is going to require that we rethink trade and step outside of the well established paradigms. In that regard our current trade wonks are next to useless because they are only fit for a single purpose. It's our regulatory and quality specialists in engineering, food safety, automotive and nuclear who will be the vanguard of British representation in trade.

For that we are going to need a lot more private sector involvement and we will need to encourage the growth of trade guilds and business lobbies - possibly even offering tax breaks for those who are members. We need to tap into private sector expertise and ensure British business interests have a direct line to the top tables. This in my view would be the biggest benefit of Brexit in that there are no EU bureaucratic hurdles standing between business and direct representation on global bodies. As much as this applies to business it also applies to British NGOs and unions.

There is a lot more to discuss on this, but we need to get over the massage that a scattergun FTA approach will wind up on the rocks - and if we want to get anywhere we will have to re-tool and retrain our trade thinkers.

Finally there is one other urgent consideration. For all the time we have been in the EU aid has run as a separate endeavour to trade, which in turn has run in abstract to foreign policy. Trade has become a technocratic offshoot and if we continue with that mentality it will function in isolation of any strategic objectives.

The last thing we want to do is chase any trade for its own sake. Our immediate strategic objective is to slow the flow of migration from Africa and trade is a tool to that end. Meanwhile we have to measure our trade objectives against certain geo-political risks and opportunities. China is presently weaponising trade and we need to be mindful that we are not unwittingly walking into ambushes.

Britain has to get real about trade and it needs and recognise that FTAs are the tool of regulatory superpowers. We are no longer playing that game. Our institutional knowledge is behind the curve. This is a whole other ball park and we are going to need new players. We are going to need to combine trade, aid, foreign policy and diplomacy and set out some clear objectives beyond easy PR wins.

Once we are out of the EU we will be fighting for our survival and fighting to retain and enhance Britain's reputation as a force for good. We have a lot riding on this and we cannot afford to to indulge ourselves in the habits of the past. We need to stop being distracted by decoys and focus on the task at hand. Geneva, not Brussels, is now the centre of the trade universe and we need to wake up to the trend of regulatory globalisation. We must shed our euro-centric thinking and get to grips with the issues or we will find ourselves adrift and rudderless. 

Nothing useful to report

I have a working theory at the moment that the closer one is to Westminster the less one is likely to understand Brexit. Anybody who has understood the size and scope of it sees no alternative but to remain in the single market. Though this is seemingly now the consensus view, even those in Westminster who support this cannot say exactly why and have a shaky understanding of the concepts.

As a whole though the most coherent consensus from Westminster is that "something must be done". It is this lack of coherence that allows the hold outs to continue to press on with their issue illiterate agenda. There is insufficient knowledge in the system to resolutely defeat it and way too much political cowardice.

As a blogger one is supposed to react to every morsel of gossip but this gets us nowhere and adds nothing. As each day passes some or other nobody MP will add their ignorance to the mountain that exists already, bringing us marginally closer to a conclusion but a consensus without a firm decision is worthless. Hence we are drifting rudderless toward the the drop.

Even this is not useful analysis in that it is nothing different to anything we could have said over the last year. At some point you just have to say "wake me up when they know what they're doing". Which could be never at this point. We simply do not have a functioning governing apparatus. It will be left to Brussels to decide for us.

As to the wider debate, I could indulge myself with a long essay on post Brexit trade strategy but if this spirals out of control then we can drop the idea entirely. Our main diplomatic efforts will be damage control and mitigation efforts. There simply won't be the budget or the resource to pursue any kind of active foreign policy.

It would seem that the UK is now politically spent. Bereft of competence. There is nothing left to do now but wait for this sorry mess to unravel. It's the end of the road, the cupboard is bare and there is nothing left to be said. Failure looks certain and then all we can do is clear up their mess. 

Wednesday, 26 July 2017

Brexit is a long overdue system reboot

I've read a lot of a stupid blogs and articles about Brexit from both sides of the divide. One characteristic of remain blogs tends to be the pathologisation of leave voters citing a populist revolt to globalisation and so on and so forth. It ain't that.

If you want to know what caused Brexit I can think of no better example than Brexit itself. We are now at a point where there is a level of sophistication in public debate that far transcends anything I've seen in Lords debates or select committee meetings. The blogs are producing some excellent stuff. There's a lot written I don't agree with and a lot of it isn't seeing the big picture but it knocks the ball right out of the park when compared to the inane gibbering of politicians and our media.

We now have an adequate idea of the scale of the task at hand, we have a decent understanding of the liabilities and there is now a wealth of useful information in the public domain. Yet, for all that, our politicians haven't grasped the basics and are hopelessly behind the curve, leading us off a cliff - with an opposition in a similar disarray, holding some deeply flawed ideas. They are not even listening.

As much as they are out of touch, they project their narrow concerns based on flawed perceptions on to the people - and that is what steers policy. Just look at David Cameron's attempt to "reform" the EU. This was never about EU migrants using the NHS. It was unbelievably patronising to think that eurosceptics would abandon a twenty year cause on the back of some marginal tinkering around the edges. To then come back with something so utterly insubstantial based on a mechanism that already exists was a further insult.

And that's really what's driven it all along. An aloof, out of touch establishment, completely unresponsive, lacking any dialogue and transmitting from upon high, telling us that our concerns are unjustified - and that it's better if we leave them to it.

But it turns out we were right. Article 50 shows that we have signed up to something deep and binding with seismic consequences - to the point where we cannot change democratic direction without an enormous amount of harm. When it came down to it, the main argument for remaining was not a principled argument for political union - just that the act of leaving would hurt.

Over the last two decades we have gradually seen Westminster turn into three ringed circus, unable to focus, distracted by trivia and caught up in sickening tribal games that we are all utterly sick of. And though you might say this is a domestic issue, the EU and our further integration is very much a symptom of it in that the same lack of scrutiny, the same lack of urgency and the same lack of care was apparent to the point where nobody is in control, the system is on autopilot, and for whatever the EU is not to blame for, it serves as a convenient scapegoat.

As much as arrogance and stupidity are the hallmark of the Brexiteers in parliament - arrogance and stupidity have largely defined the last twenty years of politics. One might even argue that the only thing stopping us going off the rails is that fact that the EU and the systems therein underpin so much of what would ordinarily be the province of Westminster.

That, unsurprisingly, is the reason given to me for reversing Brexit. It is an entirely logical and respectable point of view. We could put our hands up and admit we do not have the capacity for self-governance and perhaps it is better if the technocracy is running things. What could be improved by the involvement of these morons?

But actually, I'm not willing to put up with this any more. As a country we cannot afford it. Our polity, as much as it fails to command respect, it has no moral authority, no credibility and most of all suffers from total and utter cowardice. For a very long time now we have needed to make some serious decisions about the future sustainability of public finances - and indeed our standing in the world. The fact that we have wasted a galactic amount of money on two vanity aircraft carriers gives you an insight into our national self-image - when we are really not a superpower nor are we an especially wealthy country. The fundamentals are not sound and our entitlements are being propped up with immigration.

We are told that the NHS would not function without immigrants. We are told that we cannot afford a state pension without immigrants. I don't dispute that. But what we are actually saying here is that we are no longer willing or capable of doing those things necessary to keep a functioning first world country going - and we're leeching off a system that cannot be sustained otherwise.

We've needed to make some serious choices for a long time. We need to be phasing out the NHS. We need to make the public more reliant on their own resources for their old age. We cannot keep fire-hosing money at things that buy votes and we need urgent reform throughout. This though is not happening. We are not going to get democratic reform because those within the system have no interest in giving it to us and at the first hint of any kind of grown up policy, the government will back down if there's a protest.

There comes a point where if a government cannot take adult decisions then we have to force the issue. And this we have done with Brexit. All big spending will have to go on pause. Meddlesome government initiatives will have to be devolved or go on the back-burner and we are going to have to have a full system audit and revise a number of policies just to keep afloat.

This is ultimately a question of putting a stop to their sordid little games, forcing them to get serious and dragging the EU back into focus as something that has a profound effect on just about every single industry. We need to know what has been done in our name while the system has been on autopilot. We need to know who is really pulling the strings and who is exploiting the weaknesses. We need to know what we've got ourselves tangled up in.

For me, I'm less concerned with economic integration and globalisation - but it is something we need to engage in rather than farming it out to Brussels. Just this afternoon I was reading a paper from the US on trade dispute resolution. The author remarks "I sought to counter the complaint by some non-governmental organizations that US sovereignty and decision making authority would thereby be delegated wholesale to "faceless bureaucrats" in Geneva not accountable to the American people".

That will sound awfully familiar to anyone engaged in the Brexit debate. The people and places are interchangeable but something is happening where the traditional view of sovereignty is increasingly diluted and too much is happening off the radar. Meanwhile our politicians are completely oblivious to this. They can barely tells us what the single market is let alone tell you how it functions or how it interacts with with private authorities and global regulators - many of them operating in a shroud of anonymity which affords them the ability to act without scrutiny.

The one useful thing the Vote Leave campaign gave us was the slogan "take back control". It means many things to many people. It is not the cartoonish absolute control that many perceive it to be - and not the control remainers mockingly expect it to be. It's really a matter of bringing the decisions back into the light of day. We cannot hope to control globalisation but we can control how we respond and adapt - but not if we're not engaged in the process on a more open and public level.

Over the last couple of days there has been far reaching debate over chlorinated chicken from the USA. This raises profound questions about the future of British agriculture and the nature of the relationships we want with other countries. Unlike the TTIP debate, this is not a remote and nerdish debate for trade technocrats. This is something over which the British public alone can influence, and final responsibility lies with Westminster. We are taking control over them. That is what this is about.

When we are increasingly seeing deals concocted between giants the possibility of meaningful veto, and control over the agenda becomes ever more remote. As outlined by this blog we are seeing the emergence of a global market of rules and regulations where even the EU is just as much a passenger. There are insufficient democratic safeguards and not nearly enough genuine public engagement. You can wish it were different but that is never going to happen. British attitudes to the EU prevent it. Not least our media. People tune out of politics they feel they cannot influence or have no stake in.

They say politics is too important to leave to the politicians. Something of a truism. Countless times have I heard people say they don't do politics because that's what they pay politicians to do. But that's the problem. Our politicians have excused themselves from politics and instead play media games and tinker in things that are of no consequence. They've kicked the big decisions into the long grass and outsourced the detail to Brussels. We can't let them get away with it any more. Enough is enough. It's time to clear out the dead wood and start over.

British politics is circling the drain

One of the difficulties of running this blog is that there are only so many things to say about Brexit and I think I must have touched on most of them at least once - and eventually you get to a saturation point where you simply cannot bring yourself to say it again. On that score it is useful to have some fresh blood on the block to keep up the pressure.

What makes it more difficult is arguing for the Brexit I want to see while having to chart the Brexit we are going to get. As yet we do not know what that looks like but the debate in Westminster is is still barely half-informed, still struggling to bring forth any coherence and the Brexiteers are getting away with murder as they make a complete hash of it. Our entire political establishment has lost the plot. I have never seen anything quite so surreal in all my days.

There does seem to be a convergence of opinion on Twitter now where the sane remainers and pragmatic leavers are at least on speaking terms - and gradually we are seeing various voices getting to grips with the EEA and the potential of it. It's encouraging to see but it's a debate that needed to happen a year ago.

Strangely though, with silly season upon us, we appear to be entering a second phoney war. The field is still wide open to speculation, nothing is yet decided and the government has largely gone AWOL. Though it is unwise to make any political predictions this feels like the sort of vacuum in which politics as a whole could collapse.

As much as this government is threadbare there is still no sign that the opposition is going to get its act together. It's too broken to mend. Labour is a zombie party. It doesn't know what it is, who it represents or what it even wants. It would appear that "moderates" of the party are marking time in the hope of forming a resistance to Brexit but Corbyn's bed blockers won't let them get near the controls. I'm not sure how long that can last but the absence of coherent opposition can only hurt the country.

Eventually a crunch point for British politics will come. There has to be a seismic realignment of political forces simply because this cannot go on. It only takes a catalyst. It's now a question of what that catalyst will be. I strongly suspect it will be a major crisis on the Brexit front.

As it now looks I am starting to entertain the idea that Brexit talks will collapse. This will bring us to a state of emergency where an election will be called which the Tories cannot win, but Labour can't either. I don't think an election can solve this. Neither party is capable of commanding the confidence of the nation and nobody sane wants to see a Corbyn government. It is now abundantly clear that he is not a leader - and not even in control.

All the while in this political vacuum, the remainers are gathering their forces, but actually I think they are wasting their time. There is a hollow sense of inevitability about it all where the sequence of events required to stop Brexit simply won't materialise. We are circling the drain.

As much as I am resigned to this I now think it needs to happen. That things have sailed this far out of control tells us that Westminster is no longer capable of defending the nations interests. The system isn't working. Parliament is incapable of asserting itself, politicians are decadent and foolish and beyond the reach of us mere mortals. There is no dialogue - only noise.

In that respect remainers have got it wrong if they think stopping Brexit is going to fix anything. All it can do is sustain an unsustainable limbo where things can only get worse. I now feel that a political cataclysm is the only thing that will focus their attention. After which we will have to have a serious debate about how we now do government because Westminster as a system is not fit for purpose. It just doesn't work. If it serves any purpose at all then it is to prevent such failures. If it can't do that then the system needs a reboot. It has shown itself ill-equipped to deal with anything challenging.

I hope I am wrong and I would like to be. We may yet see sanity prevail - but at this point there is no indication that it will. For a long time I have suspected a political reckoning is on the way. Politics has been detached for so long in its own pocket of unreality, making error after error, that there has to be consequences.

For all that remainers speak of the supreme arrogance and foolishness of the Brexiteers I just see it as symptomatic. This to me doesn't look any different to the urgent hubris that ratified Lisbon, using all arms of the system to ram it through. The same threadbare politics that took us to war in Iraq. We stumble from crisis to crisis with no control over our government with wholly inadequate constitutional safeguards. I would rather see it fail one final time than to see it limp on a moment longer.

From what I can see of the remainers, avoiding Brexit is largely about avoiding the inconvenience of political instability. It's based on a naive assumption that their worlds can continue uninterrupted while we brush it all under the carpet. This would be unwise.

Some have suggested that stopping Brexit would cause civil unrest. I don't think so. It's not in the nature of leavers. It's the left who take to the street and smash shop windows. Thwarting Brexit will have a far more profound and lasting effect. The voters will quietly conclude that their vote doesn't matter - and from there we have turned a corner.

The politicians will go back to their usual inanities, politics will continue to degrade. Without the catalyst for serious reform and introspection I think we are on a collusion course for a collapse even worse than the worst Brexit. We'll have a widely despised political class and a public just biding its time to take political revenge.

All the while, the social contract will be broken. A government without legitimacy, without moral authority cannot hope to maintain societal cohesion. As soon as you tell voters their vote is irrelevant, we'll have lost something vital. There will be no obligation for decency in politics, things will turn sour like we have never seen and the state will turn inward and ever more authoritarian, living in fear of what the public may do.

Brexit is our one chance to sort this all out. I would prefer it we could have a sensible, negotiated Brexit, because I still think that is the best option for the UK - but if it's a choice between a clear out and limping on with the status quo then let the chips fall where they may. Britain as we knew it is gone. A decision was made last year - one that said we cannot go on like this. It wasn't a plea to end austerity. It wasn't a suggestion to tinker with a policy here or there. It was a coherent demand for political change. God help those who stand in the way of it. The Brexit vote was a manifestation of decades of dissatisfaction. Add one more betrayal and see what that gets you. You won't like it.

Monday, 24 July 2017

Empty words from Fox

Of the events from the last week, one is not inclined to jump on the bandwagon of US-UK trade relations. I have already set out my thoughts on that with some further thoughts on Tremr yesterday. There is zero chance of a trade agreement with the USA happening until Brexit is concluded. Furthermore we could very well be wasting our resources in that TTIP is not dead. It just smells funny.

The EU-US Mutual Recognition Agreement (MRA) on inspection of medicines manufacturers will come into force on 1 November 2017. A building block to TTIP by the back door. The EU has discovered unbundling. We may as well negotiate with the EU to carry over these agreements as they are installed since we are in all likelihood going to remain inside the EU's sphere of regulatory influence.

The main event of the week in my view was Liam Fox's speech to the WTO. The speech itself was quite good. Straight out of the multilateralist playbook, no risks taken, no stupid remarks about Brexit and plenty of boilerplate mentions of flagship WTO initiatives.

Clearly it was too sensible to have been written by Fox. An adult was involved. I suspect Julian Braithwaite, UK Permanent Representative to the UN and WTO in Geneva is behind it. He is no fool. We do have some good guys working behind the scenes even if it doesn't feel that way.

Fox has said "For all the benefits that FTAs have brought to international trade, they are far from the only tools at our disposal – from mutual recognition agreements, to ministerial dialogues, to trade working groups, and greater cross-border facilitation. For the United Kingdom, the future of global trade will be shaped by three things - the digital economy, the promotion of trade as the main tool of development, and unlocking the vast potential of the trade in services. In all of these areas, the WTO has the potential to set the agenda, ensuring that such developments are approached in a way that remains both mutually beneficial, and dedicated to the principles and values of the organisation".

This is music to my ears, but what is saddening is that Fox has only mouthed the platitudes, as indeed one does at the WTO. I might have spoken those words with conviction, but for Fox, these are meaningless concepts. The Tories are still trapped in the FTA mentality - which explains this ill advised junket to America.

That said, the speech is a marker of a sort, entered into the official record. It is a yardstick by which to measure future efforts. These words may yet take on meaning when the penny drops that we are not ready to run with FTAs. Sooner or later it will dawn on them that we are no longer playing that game. We are going to need an entirely new approach - and this old dog needs new tricks, fast.

Saturday, 22 July 2017

Light blogging.

Please excuse the lack of blogging. I have injured myself and am presently unable to sit upright. Not fun.

Wednesday, 19 July 2017

Brexit: wishing it were simpler

One of the more annoying canards from Brexiteers is that no other "trade deal" requires a court to sit in judgement over it. I think it was blogger Tony Edwards who remarked just recently that there can be no combination of words more imprecise and aggravatingly useless than the words "trade deal". No truer words.

There are of course many levels of "trade deals" but it would be better to call them intergovernmental relationships. Any relationship will begin with basic agreements, not especially detailed and largely open the door for the development of closer relations. A memorandum of understanding grows into a free trade agreement which can then evolve into something much more sophisticated like an association agreement.

In a more basic relationship disputes are resolved through normal diplomatic channels but the busier agreements may require a joint committee, establishing domestic offices to service that relationship. When things get as serious as a free trade agreement extending into areas of regulatory cooperation there is then a need for a formal dispute resolution system. These can vary and as yet there is no uniform approach - not least since the methodology of dispute resolution is always evolving as trade relations become more complex.

In the case of the EU-Chile association agreement there is an arbitration procedure - one of the first to specify fully open hearings. This is a method subsequently adopted by the USA. Where it gets more complex is that, as we have noted before, EU FTAs very often reproduce whole tracts of WTO law, particularly in regard to phytosanitary measures to protect humans, animals, and plants from diseases, pests, or contaminants. Increasingly EU agreements go much further, embedding large tracts of the WTO agreement on Technical Barriers to Trade.

This causes overlaps in terms of legal interpretations where WTO law cannot be disregarded and arbitration panels cannot rule in place of the WTO dispute settlement body. This creates a complex relationship between FTA and WTO law. As I understand it, dispute resolution has a sequencing order where complaints are first put through diplomatic channels and if no resolution can be found, a complaint is referred to the arbitration body and then the WTO as a last resort.

This is further complicated when dealing with agreements between two blocs where a far more sophisticated mechanism is required as the relationships are usually far more comprehensive - none more so than  the EEA agreement between Efta states and the EU. Originally Efta had a far more informal structure but with the EEA agreement it became clear that a more robust and authoritative system was needed to further relations with the EU. This brought about the creation of the Efta court.

The purpose of a court is to bring about some finality to ongoing complaints. Normally disagreements can be resolved through joint committees and normal diplomatic relations but if a serious complaint drags on, a referral to the court brings it into formal focus where the court must bring about a resolution in a timely fashion.

For EU members there is the ECJ but with Efta states being outside of the EU and not under ECJ jurisdiction the Efta court is used for ironing out serious issues which cannot be resolved through normal channels. The rulings themselves are not binding, but a failure to implement them carries consequences - usually retaliatory measures which can be justified either under the EEA agreement or WTO law.

A persistent canard of the single market debate is that Britain in the EEA would still be under ECJ jurisdiction. This is wrong and those who speak it often know full well that this is wrong and they are in fact lying. In most circumstances the Efta court has to take ECJ rulings into account - which for some is still a red line, but this is no different to the EU taking WTO rulings into account where there is overlap between WTO law and law set out by the FTA. The Efta court respects the ECJ and Efta member states respect the Efta rulings. In a theoretical and practical sense, sovereignty is preserved.

Some remark that Norway has never exercised any kind of veto - which as far as I know is true but there are two considerations to take into account. Firstly every day complaints are dealt with through ongoing relations through the EEA secretariat and very often there is no need to elevate it to a court, and secondly, with the UK being a larger and more diverse economy, and one with sufficient economic power to say no, the UK most likely would exercise its right of reservation - commonly described as a veto. This of course is not the only way for member states to secure resolutions in that there are country specific protocols and annexes in the EEA agreement which can be negotiated by other means.

The depth and complexity of an agreement largely dictates the shape and scope of any dispute resolution mechanism. As Britain will necessarily require a deep and comprehensive agreement with the EU it follows that whatever form our relationship takes, there will need to be an arbitration system and a formal means of bringing complaints.

Since we will need what is called "frictionless trade" and we are seeking to enjoy the same level of free trade in goods, that will require that we conform to EU import controls and the ECJ will be the means by which interpretation of the EU's own rules is done. That is currently the position Switzerland has to endure on animal product exports because there is no system of co-determination. This is what makes the Efta-EEA arrangement a superior agreement and one that gives more scope for the exercise of sovereignty.

While it is true that other countries have FTAs with the EU without a court system, they do not enjoy the same level of customs cooperation. Any partner wishing to enhance their level of cooperation will have to work toward harmonisation - and as the EU is the larger market, that relationship will largely be asymmetrical. That means they do as the EU says with little or no independent adjudication.

Brexiteers a plagued by a certain mindset. They believe a new relationship with the EU cannot and must not be complex, expecting all of the same advantages without acknowledging that there are systems involved in order to make it all work. To be fair, you can sort of see their point. Trade and customs rules and regulations are mind-bogglingly complex and only super-humans have a full grasp of how it all works. But the point being that when we need a relationship covering everything from fisheries to space policy, we will need the structures, systems and institutions that go with it. Only if we were considering breaking off much of our inter-EU cooperation could we arrive at a simpler framework.

This is of course is what Mrs May in her Lancaster House speech said that we were not going to do. The words "deep and special relationship" are her words and they are not chosen at random. A deep and special relationship requires an extensive agreement and if that isn't the EEA then it will have to be something similar - and there will have to be a dispute resolution system - and it will be one that takes its cue from the ECJ. This is why I think leaving the single market is a particularly stupid idea. we would be reinventing the wheel only to come up with something that wouldn't be nearly as fair and transparent as Efta. You really would have to be "thick as mince" to consider it.

Brexit: treading water

As I understand it, silly season is upon us. As ever I struggle to notice a difference. One would think there was a necessity to keep pressing on the Brexit front but it would seem the chatterati have lost interest and instead are gossiping about BBC presenter salaries. I wish I could join in but I really don't care. I have never bought a TV licence and I'm never going to.

Distressingly though, Brexit seems to have slipped from the agenda. All we're getting is amateurish recycled material, and even though it's important and it does need to be said by as many as possible, it is not penetrating the bubble and still there is no sign of sanity prevailing.

This makes it all the more difficult to blog in that it is incredibly difficult to write pro-Brexit material when the Brexit that could be good is slipping through our fingers by the day. It barely seems worth the trouble climbing into the detail in order to look for solutions and ideas when it looks like our sole activity on Brexit day will be disaster recovery. If this goes the way it looks to be going then all plans and big ideas will go out of the window.

I should take some heart though. Throughout we've been told that people would listen if only we were less abrasive, but now most of the media seems to be catching up along with many of the more neutral sources - and they are not getting through either.

It amuses me greatly that in last night's meeting of Bristol for Europe, apart from the whole remaining in the EU thing, there was little in Mike Galsworthy's analysis I could disagree with. It's going off the rails, the government hasn't a clue and it doesn't seem like anybody can get through. Galsworthy and his colleagues have produced endless reports and presented evidence to select committees and have got nowhere - and nobody can say Dr Galsworthy's behaviour is anything less than impeccable. He shows far more patience than I. 

Meanwhile the public debate, what's left of it, is still a jaded rehash of the referendum and it has not progressed even an inch. Die hard remainers are still calling us xenophobes and Brexiteers are still hell bent on the most suicidal Brexit possible having learned precisely zero about the process over the last twelve months.

It would seem the only way to communicate anything to anybody in respect of Brexit is to tell them what they want to hear and nothing else, which largely makes any communication utterly redundant. In the meantime, we're not getting anywhere close to the details. The bickering over the "exit bill" is only just beginning but this will be reduced to a tedious biff-bam showdown where the media gets distracted by the trivialities - and assuming our government is not crass enough to walk out, the UK will capitulate.

As far as I see it, this won't get interesting until we hit the wall of the Northern Ireland question. When that happens, that's when we will need to see some grown up decision making. There is no discussing that issue without raising the means by which goods will cross borders and that will have a considerable influence on where this goes. This is when the empty nostrums of the Tories will start to fall apart and it will become increasingly clear that our options are few. Hopefully that is when the noose of reality will tighten around the neck of David Davis.

Even that, though, at this point, seems overly optimistic. The Tories have demonstrated an impressive ability to evade reality even when the chips are down. It will probably take a major crisis for the penny to drop. That makes this a waiting game. We can do nothing but tread water until we know more. Anybody with any sense would go on holiday.

Tuesday, 18 July 2017

Behind enemy lines

This evening I attended a meeting of Bristol for Europe (BFE), a continuity remain campaign, featuring Jolyon Maugham and Dr Mike Galsworthy. First off the bat, BFE is part of a network of similar groups based out of major cities. 250 were in attendance, largely middle class and the well to do. Brexiteers have no equivalent. Their goal is unequivocal: stop Brexit.

As Maugham sees it, remaining is still a distinct possibility but only if a second referendum can be leveraged - requiring their campaign to play the long game - their biggest asset being the incompetence of this government. Meanwhile, he is exploring the possibility of a court case to carry over EU citizenship after Brexit for all living UK citizens.

Given the timescales I think he is grasping at straws and I don't think he has a hope in hell of bringing such a case. He is right in that government incompetence is their biggest asset but I think we're going to have to take the hit of a bodged Brexit before they can exploit that public mood. It will take a collapse of this government to bring about another referendum.

What I suspect is that we're in for a Tory self-immolation Brexit that will see the EU offer an association agreement in order to fix the immediate problems - which will be put to a referendum and it will pass by two to one. In the mean time, a lot of damage will be done and our new status will be worse than any relationship imaginable. The political cost will be high.

In that regard it is a mistake for continuity remain to push to overturn Brexit in that it only strengthens resolve among Brexiteers. The smart move would be to meet leavers half way and push for the EEA so we don't end up with a bloody nose.

On the whole I get the impression that Maugham is a Shanker Singham type - a fraud making a name for himself on the back of gullible devotees.  I don't think you can claim to be a democrat while engaed in malicious judicial activism. It is an affront to politics. 

As to Mike Galsworthy, actually a likeable and sincere guy, he acknowledged that a workable Brexit could be achieved but not under this government - and increasingly it looks like he is right. There is too much arrogance and not enough knowledge. What was interesting though was his observation that remain lost because the Stronger In campaign came out of nowhere, appropriating control of the agenda, squeezing out all grassroots campaigns while pretending to be an umbrella. This is why he set up Scientists for EU. The exact same reason we set up The Leave Alliance.

This actually tells us quite a lot about the state of politics where you have a referendum campaign appropriated by both wings of the establishment, each side having their cornerstone lies, talking about issues in abstract to what ordinary groups were concerned with, where the entire media debate happened in a parallel universe to the one happening online and in the pubs. This is part of the sickness in British politics which goes some way to explain why this government is singularly incapable of delivering a sane Brexit.

To his credit, Galsworthy remarked that the Brexiteers should be commended for our achievements in forcing this to the forefront of politics and giving everyone a real education in what the EU is, how it works and what it does. Something that has been buried for forty years. Lost on him, though, is the fact that should continuity remain succeed then everything gets brushed under the carpet and vital areas of policy go back on autopilot - while the morons presently incapable of delivering Brexit carry on making a pigs ear of everything else. The same people who sabotaged his and my efforts.

This is actually why I am still fighting for Brexit. This is more than about leaving the EU. This is about the reclamation of politics for the people. Remainers are utterly mistaken if they think that reversing Brexit will fix anything. The vote has exposed too many faultlines in politics which can no longer be ignored. To many these faults were already gloriously apparent which is why an establishment led remain campaign ultimately lost.

Ultimately Brexit has kicked off a long war - and though Brexiteers won the first battle, we have a long way to go and nothing is settled yet. Even if the remainers succeed, there can be no going back. We have certainly started something and it won't be resolved easily.

Monday, 17 July 2017

A Poseidon adventure

I spent a little while talking to a crew chief for one of the P-8 Poseidons yesterday. He's been on secondment to the US Navy, along with the rest of his squadron for a few years now. Britain is not due to operate the P8 until about 2020 but it was felt that retaining experienced ground crew after the scrapping of Nimrod was essential in order to retain and build on institutional knowledge.

Since 2010, British airmen have been working to support US operational squadrons with a view to bringing those skills back to the UK and training their replacements. Likely it would have cost considerably more to let all that knowledge go, and rebuilding squadron support from the ground up would have caused significant delays.

What surprised me was that the MoD had taken an eminently sensible long term view. But then this is actually the whole point of the P8 - to have a standard maritime patrol aircraft throughout NATO, one based on a commercial airframe, meaning these aircraft can be kept running all day, every day with spares and major overhaul costs kept to a minimum.

In that regard we have a NATO wide force all operating to the same standards, methods and practices but each free to innovate of their own accord. Each nation owns their own aircraft and are free to try out different ideas.

It's been a long time since I could say unequivocally that the MoD has got something right. I suppose this was a no-brainer though so even those without brains could not have screwed this up. What's interesting, though, is this requires a good deal of cooperation between Boeing, BAe Systems, the Royal Air Force, the US Navy, NATO, and all the contractors and families involved. Since a lot of it is highly classified this all has to work within a network of close cooperation agreements.

And that's really the point. As close cooperation and operational integration goes, it doesn't get closer than this. It's a true partnership between nations. Absolute cooperation in the common good, in the cause of peace and security. The deepest kind of international engagement. I must have been imagining it though. We all know that cannot happen without political union and being in the EU! So they say.

Saturday, 15 July 2017

Incapable of honesty

A frank and refreshingly honest blog post comes from Oliver Norgrove, former media analyst at Vote Leave. That's what I admire the most in bloggers; self-awareness and integrity in ways our media cannot muster. Certainly not Alan Beattie of the FT. Norgrove gives us some indication as to the dishonesty at the heart of Vote Leave.
"By the time I was an employee at Vote Leave, I was still without any real knowledge of the EU's institutions and mechanisms, let alone trade and regulation (which are still every bit as mystifying to me). I remember around late April asking Matthew Elliott what the campaign's position on access to the single market was after leaving. He replied: 'we say that there is a free trade zone right across Europe, from Iceland to Istanbul, with no tariffs'. I suspected at the time that it wasn't nuanced or reflective of reality, but it sounded convincing so I was happy to go with it. The public, I thought, wouldn't be interested in reading about the different trading relationships that many of these countries had with the EU, so why not go with what sounded simplest?
This is in keeping with Dominic Cummings, who when quizzed by the economic affairs select committee attempted to deny we were even in the single market. Vote Leave was a singularly dishonest outfit from the very beginning. And that is so very typical of the breed. Elliott's brother in law, Allister Heath, sees no obstacle in effectively raiding our research, misrepresenting it and taking credit for it. Surprised he didn't end up at the FT. Says Heath:
The real reason why we – as a large and powerful economy – would have greater influence in EFTA than in the EU is that Brussels is increasingly not the place where big decisions take place. Rules are increasingly negotiated under the auspices of global bodies: automotive norms are determined by the World Forum for the Harmonisation of Vehicle Regulations; food standards are determined by Codex Alimentarius; naval rules are under the aegis of the International Maritime Organisation; and the crucial new banking regulations are being determined by the Financial Stability Board. These regulations are then passed down, with the odd gold-plating, by the EU. These global bodies proceed by consensus, not qualified majority; we are currently represented by the EU at these meetings. A Brexit would allow us to have a seat at these top tables, and thus to disintermediate Brussels.
Quite obviously there is no other place this could have come from. The clue that Heath has no idea what he's talking about is the assertion that "naval rules" are under the aegis of the International Maritime Organisation. Naval? Pardon my French, but, for fucks sake!

The article itself was from before the referendum, but all the same, he was in a position to offer any one of the Brexit bloggers, who actually do know what they are talking about, a chance to make the argument. But that's actually not how these people operate. It's always been about preserving their little dung heap and reinforcing their dismal narratives - just as Alan Beattie has done in the FT. Self-serving parasites to a man.

We are constantly told more people would listen if only we were polite about them. It turns out they do listen - but only to the bits they want to hear. That's the basic problem. They are incapable of honesty, courtesy or decency. Why should we be polite to, or about them?

The Brexit that can work

I don't like the EU. I don't like the idea of it. I don't think it can ever be a democracy and I don't think it even wants to be. There are few, if any, means by which the people can achieve reform and for as long as the UK is structurally outvoted, too much of our law is beyond the reach of politics to a point where we can say that the UK is no longer democratic. The nation state is the only level where you can have meaningful democracy. I'm glad we are leaving the EU.

This, though, can go one of two ways. We can either make such a heaving pigs ear of it that Britain never fully recovers or we can recognise the limitations of our predicament.

When Brexiteers talk about Brexit they make some fundamental errors. They point to CETA as an example of a future trading relationship with the EU. But what one should note is that Canada is not twenty miles off the coast of the EU and indeed has never been in a forty year long economic and political union with it. It is far easier to enter such an arrangement than it is to leave one.

The second mistake is to assume that outside the EU you have sovereignty and inside you don't. The moment anyone enters a trade agreement where regulatory harmonisation is a feature, some control is ceded in the common good. Brexit is really about how much is too much. On that score I'm with the Brexiteers. The EU is a bridge too far.

The third mistake is to believe that the EU is bureaucratic tangled mess of regulations and red tape and that outside of the EU there's a light touch regulation world just waiting for leadership by a buccaneering Brexit Britain. I'm not sure if that was ever true, but if it was, that world has not existed since about 1992 - and since the birth of the internet and the dawn of hyper-globalisation, all the rules have changed.

But then it's not just the Brexiteers who have some daft ideas. Our remainer friends seem to think the fullest extent of international engagement is membership of the EU and somehow not being a member of it makes us some kind of international pariah. And as bad as Brexiteers are with their "regulation is baaaaad" routine, the remainers who insist that EU regulation couldn't possibly be anything other than wholesome and benevolent are equally absurd. When it comes to the far extremes of the Brexit debate I hold them both in equal contempt.

The fact of the matter is that that we can have extensive economic and customs cooperation with the EU and others without political subordination. Personally I can't see why you would want it any other way. What makes the EU toxic is that it is a centralising and homogenising force which takes no account of cultural and political differences to the point where it will use coercion to enforce its integrationist agenda. It is profoundly antidemocratic.

The problem for us, though, is that it will continue to exist long after we have left it. So really this process is a matter of finding a relationship that satisfies our desire for economic cooperation along with our need for greater democracy and self-rule.

This is going to require something that both sides have a phobia of. Compromise. On both sides you have conspiratorial nutcases. Remainers believe that we are some kind of backward Tory island populated by drooling racist savages - with our worst impulses held at bay by the benevolent EU, while the Brexiteers think the EU is basically the fourth Reich and run by Marxists who want to turn us all into androgynous clones with no genitals, slaves to our Muslim overseers. There's all stripes of stupid to contend with.

What we actually want though is a collaborative, cooperative and consultative relationship with the EU. As a member we are a legal subordinate - and that is why for many of us the ECJ is a bit of a red line. It's not that the ECJ is especially malevolent but it is an instrument of integration and a means by which the EU accumulates more power. Powers which are not given freely by way of EU treaties are taken by court rulings.

This has never sat right with me. There are of course plenty of examples where the UK does abide by supranational court rulings simply because we prefer the rule of law, but what we note about the ECJ is that it is an agenda driven court - and one which has sovereign power over us in ways that the WTO does not.

We are told that this political subordination is necessary for there to be economic cooperation but Norway shows us that is not true. It participates in the single market but adopts EU rulings via the Efta court, a non-binding court, where they are at liberty to disregard it if they are prepared to accept the inherent trade-offs.

Personally I don't see the problem with that in that we do want regulatory cooperation to an extent and though the powers of veto are not absolute, they are adequate. The independence and sovereignty gained by entering such an arrangement is more than just symbolic. It excludes the aspects of the EU acquis designed to bring about the vision of nation called Europe.

As much as this relationship is suitable it also take into account that the economic aspect of our relationship extends far beyond the movement of goods and services, encompassing hundreds of areas of cooperation where there is little to be gained from acting unilaterally and where there are greater costs to acting independently, often for little advantage.

The fact of the matter is that good regulation is often the product of good science. It costs money to produce and when these regulations are designed to protect us from transboundary threats, international cooperation is necessary and it follows that we would want collaborative institutions.

We are told that the EU is the manifestation of this but EU institutions are not collaborative. They are branches of the EU government which supersede our own. Again this is something of a red line for us. Cooperation we want, subordination we do not.

And then there is trade. The problem with the EU is that trade is view in abstract of foreign policy and has become a sanitised technocratic domain. Much of it is conducted out of sight and often disconnected entirely from broader foreign policy which hampers our leverage when acting internationally, denuding us of a vital tool. A nation that is not free to pick and choose who it cooperates with is not a nation in its own right.

This is why the EEA agreement is ideal for the UK in that it does give us the extensive EU cooperation we want but at the same time gives us back those vital powers to explore other opportunities using different methods to the EU. As much as I see this being beneficial to the UK, I also think it better for Europe if nations can play to their strengths and forge greater links with their more traditional partners.

Ultimately Brexit is about breaking away from ideological political union for its own sake. I see absolutely zero reason to bring an end to economic cooperation and no real value in erecting new barriers with our European allies. Were there the possibility of compensating by way of trading with the rest of the world, it would still be a shame to lose any trade or place restrictions on the freedoms we enjoy.

The problem we have is that those steering Brexit have a flawed idea of what Brexit can and should achieve. There are no economic admirals waiting in the wings for when we leave the EU. Whatever gains we make will be hard fought for and we can only prosper if they are in addition to the economic cooperation we have with the EU. The gains come from further cooperation and in many cases from collaborating with the EU, who should still be a close ally after we leave.

Prosperity does not come from salami-slicing economic freedoms, nor does it come from pruning regulations to the bone. Prosperity comes from lifting other nations out of poverty and enhancing their ability to trade. This is why we need a combined trade, aid and foreign policy where we don't have to seek permission from Brussels.

Britain now stands at a crossroads. Ending political union with the EU should not be all that controversial. We are still a first world leading economy, we are still signatories to multiple global conventions on everything from climate change to human rights and we are still, despite the wailing of remainers, a liberal country. What could hurt us though, is an unnecessarily hostile attitude to the EU and turning our backs on European cooperation. In that respect the remainers are right in that there is a strong element of europhobia behind Brexit - and it is that which will hurt us more than Brexit itself.

From the beginning I argued that leaving the EU would have an economic cost. The uncertainty would likely drive us toward a manageable recession from which we could recover - but this government is making that far worse than it needs to be by holding on to those dismal misconceptions outlined here. This insane drive for an absolutist sovereignty that doesn't really exist, in pursuit of an independence that is neither desirable or even possible in this interconnected world, is one that will ultimately destroy British credibility and ensure that we will likely never recover what we lose.

This is why the fight must continue to the last hour, to the last man. The Efta EEA solution is far better than either remainers or Brexiters paint it. It is neither a leash nor does it especially exclude us from influencing the rules - not least since the globalisation of regulation. What we lose in terms of EU influence we gain by way of being able to design our own path in the world. It makes the EU a partner, not a master.

As pointed out before, the EU is not the sole proprietor of the single market. It is a collaborative venture between Efta and the EU. It is a rules based system, largely based on global standards and one that has been enormously beneficial to the UK. Britain has always been about extending liberty and prosperity and there is no reason why we cannot use our new status to continue in that tradition. We can use our soft power and aid to ensure that more countries can participate in the single market to a point where the EU is no longer the dominant influence within it. As much as that is compatible with our own ends it also speaks to the spirit of EU cooperation with third countries - and there is a good chance we can do it faster than they can. 

If we enter Brexit in the spirit of continued collaboration and friendship then there is every reason to believe Brexit can be a success. An Efta EEA solution would maintains much of what we value while dispensing with much that we do not. Something that most of us can live with - save for the miserablists on either end of the spectrum who can never be appeased. This is the future I want for Britain, not the miserly, dated and clueless vision offered up by the Tories.

Ultimately Brexit can either be a catastrophe or the breath of fresh air we have all been waiting for. It's all still to play for. It really all depends on winning the arguments now and moving to stop the Tory zealots from smashing us on the rocks of ideology. If we fail to do that then the outlook is quite bleak indeed. Let's make sure that doesn't happen.

Sorry folks, but Brexit needs to happen

Yesterday I picked up on Nick Boles and his complete abdication from his responsibilities as a legislator. He's not alone in that. We've got MPs clamouring for us to remain in the single market without being able to muster a functioning definition of it it, and stern warnings that we must stay in the customs union regardless of not having the slightest idea of what a customs union is. Then on the Brexit side of the argument we have Brexiteers who, for all the tea in China, are never ever going to understand how international trade works. This is Operation Enduring Clusterfuck.

As we look on, examining the issues as they arise, we find a political class completely incapable of absorbing the details. That could be forgiven in ordinary circumstances but Brexit didn't arrive out of the blue. From the moment David Cameron announced a referendum the game was afoot. They've had two years to get to grips with the issues and still they have not yet progressed past Janet and John level. What is striking though is that they don't actually want to know the details, preferring instead to play their tribal games.

Over the course of these last two years I've had remainers tell me the problem is not with the EU, rather it is our attitude to EU membership. To an extent I've always agreed with that but more so than ever now. EU membership has always been treated as an adjunct to politics both by politicians and the media. If you look at what Brussels correspondents produce, it is mostly people focussed trivia. Even the European Scrutiny Committee was treated with casual contempt, largely serving as a talking shop for hardline eurosceptics. We have not engaged in EU membership - and we were never going to.

Our membership of the EU has simmered on the back-burner for year. The last time it attracted any major attention was during the ratification of the Lisbon treaty which secured minimal scrutiny, which is part of the reason we are presently in this mess. Our politicians are simply not interested in governing and governance.

What makes Brexit necessary is the need to expose this. We have a system limping along on autopilot and we are funding a Westminster political machine which is failing to do its job. It no longer has the capability. It is tasked with too much meaning their attention spans wander, and there is absolutely no possibility of them adequately focussing on any one thing. This is what happens when all of the power gravitates to the centre.

As much as this is evident in Brexit, it is pronounced in nearly all other affairs. Take the Iraq war. All the way through our political class was focussed on the domestic politics leading up to the invasion, engaging in just about any issue other than the actual warfighting. In the same way that our politicians abdicate their responsibilities to Brussels (and pass on the subsequent blame), responsibility for the conduct of the war was passed to MoD officials and the top brass. Having lacked the inquisitiveness to find out what was happening, the war in Iraq rapidly spiralled out of control, seeing some catastrophic military defeats - yet there was no real enquiry as to what went wrong. Even today we are fighting the consequences of those failures.

Similarly with welfare reform, we see politicians ever ready to cherry pick the sob stories for their own ends but who is climbing into the details and applying proper scrutiny to a system roll-out that is faltering on every level? No one. Politicians don't do detail and our media doesn't either.

There are some days when I wonder how things function as well as they do. Course we know the answer to that. Everything bounces from crisis to crisis and to save political face is fire-hosed with money. Hinkley Point power station is now expected to cost twenty billion. We have two largely useless aircraft carriers that will suck up most of the Royal Navy's operations budget - and it has taken ten years and hundreds of millions just to get the Eurofighter to fire a Brimstone missile. It will be ready to retire before it is fully strike capable.

As to Brexit, Brexit doesn't have to be a trainwreck but it's a safe bet that it will be for the simple reason that our government no longer does anything well. It's only through a last minute injection of vast quantities of cash that we are not looking at blackouts across the national grid. This political status quo is simply not sustainable. This is down to a culmination of poor choices over the years, driven by a political class more interested in virtue signalling than taking adult decisions - spending as though the financial crash never actually happened.

Looking at it as a whole I think we were always on course for a national humiliation. If anything the Brexit vote was public disaffection reaching critical mass, forcing government to put the brakes on everything and take a long hard look at itself. That moment of reckoning is not far off.

Very often I see tweets from remainers pointing out that Brexit is taking up time and resources that could be better applied elsewhere. Perhaps that is true but the stark reality is that the time and resources would not be put to better use. We would see the same continuity politics - venal, corrupt, incompetent. I would argue that there is no better use of time and resources than a full audit of the statute book and a deep and comprehensive examination of the constitution.

As it transpires, our politics is not up to the task at hand. They have yet to comprehend the enormity of the task, which is why we have fools like Nick Boles telling us we can transition overnight into Efta to stay for only three years. The fact that anyone thinks Brexit is going to happen in two years is alarming.

I had hoped, and indeed expected, by now that we would see minds beginning to focus, where the reality of our predicament would force politicians to face the fact that we need a soft Brexit. As a working assumption, with a remain majority in parliament, this seemed like a safe bet. The fact this has not happened actually demonstrates that politics is in a far worse state than even I imagined.

So it now seems that a calamity is upon us - and we are largely powerless to prevent it. Brexit has taken on a life of its own and parliament lacks the coherence and the moral authority to intervene. We are drifting to oblivion. What that tells you is that the Westminster system is spent. Between the corrosive effect of modern media and the natural atrophy caused by EU membership, Westminster has become a playground for posers, frauds and dilettantes. It is a toxic ecosystem of its own and it is chewing away at the fabric of the nation.

So now we are faced with a choice. We can either brush this under the carpet and reverse course or we can grasp the nettle and get on with it. If we opt for the former we are only delaying the inevitable. We can go back to pretending everything is fine and hold our empty voting rituals every five years but ultimately extinction is the only destination for this political settlement. The patient is too sick to live.

I now expect Brexit will be a pigs ear the likes we have not seen for a generation or more. Some commentators have compared it to Suez. It's going to be far worse than that. There is the potential for the total collapse of our constitution and the collapse of the current economic settlement. It doesn't have to be that way but when you take a look at these Tories it seems unavoidable.

Admittedly I am not enthused by this prospect but actually I don't see any other way out. As much as anything Ukip and the SNP show us that as a country we have forgotten how to do politics. Anyone can knock up a populist manifesto and bleat to the cameras but without a coherent plan they fall flat the moment they get anywhere near power. The larger they get the more they become what they seek to replace. You can change the people in the system but the system always wins.

So what are we going to do? Are we going to live out the fag end of "representative democracy" waiting for its inevitable implosion or are we going to take matters into our own hands? We can pass the consequences to the next generation or we can choose to be the the architects of change. It's that simple. This is our one chance to fix it - assuming it can be fixed. It's time to bite the bullet.