Saturday, 30 September 2017

America is not our friend

The Bombardier tariff debacle really ought to trigger some wider debate about the USA and its motives. It is assumed that this protectionist hostility is a consequence of Trump's election. It isn't. This is just what the USA does.

The USA has a track record of frustrating the WTO - even under Obama - and it goes way back. It is not interested in harmonisation. Moreover, if TTIP wasn't going to pass under Obama then it is never going to pass at all. So what chance does the UK have?

The short of it is that the USA is big and diverse enough not to be as dependent on trade as the rest of us. It will only really use trade as a foreign policy tool. And on that score, the USA is not our friend, nor is it a friend of the EU.

In this we have to look at the relationship between the EU and the WTO. They are intertwined, especially since Lisbon. The Lisbon treaty pretty much marries the EU to the WTO and most major WTO developments are EU initiatives.

Moreover, the WTO framework forms the DNA of all post-Lisbon EU FTAs. This arguably makes the EU the power broker in multilateral affairs. You could even go as far as saying there is a strategic EU aim to annexe the WTO. Softly, of course.

That I know of, nobody else uses WTO tract as the basis of its FTAs like the EU does unless at the behest of the EU. This makes the WTO the instrument of EU trade hegemony - which also explains why the USA is always undermining multilateralism.

The more the EU converges its trade rules with the WTO, and the more the WTO matures, the more they look and feel one and the same. And that is why Brexit, to a point, presents us with the "double coffin lid". Even on WTO terms the EU is still calling the shots.

So this does present some considerable cognitive dissonance for the Tory Brexit sovereigntists. We have to confront the fact that sovereignty as we know it does not exist as such. We can only really retain the right to say no.

With the USA being fiercely protective of its sovereignty it has a foreign policy objective to frustrate both the EU and the WTO. This then explains why the ultra Brexiters have a fondness for Trump. They have the same attitudes to regulatory sovereignty.

The problem for us, though, is that we very much are dependent on trade and dependent on EU imports for food and energy etc. This is why there is zero chance of escaping the gravitational pull of the single market and SM regulations on goods.

So the choice is really one of how we adopt the rules, what sort of firewall we have, and who gets to adjudicate and on what terms. The most democratic mechanism - and certainty the best (access wise) is the EEA (Norway). Switzerland has to use EU rules with ECJ rule.

The Tories think that they can get a better deal - sovereignty plus "access" plus no fiscal obligations. Not going to happen. This is all on the assumption that the USA is the more attractive market. This is a most dangerous miscalculation.

On trade the USA most definitely has malicious intent and it will be no friend to the UK. America ALWAYS has an America First policy. And though we can say that the EU is corrupt and bureaucratic, it at least has genuine aims of a stable global rules based system.

So this is really a choice between an ordered world with diminishing sovereignty or trade chaos where winner takes all. If its the latter, the smaller fish can expect to be cannibalised. There is wisdom in close trade cooperation with EU.

This though is not an argument against Brexit. The foundation of EU rules are UNECE, ISO and Codex etc as per WTO TBT. We just have to recognise that the EU is a fact of life - and it is not in our interests to unplug entirely as the Tories propose.

Boris Johnson must go

Tory MPs need to be asking themselves if Johnson is really the best they have to offer. If not, they need to act now. Events have a way of taking on a life of their own and BJ could end up PM because there simply wasn't anything to stop him. All too often if a decision is not made then life has a way of forcing a decision on you.

And let's be clear on this; Boris Johnson would be a disaster. Actually worse than Corbyn. Boris Johnson is a sociopath. He does not care about anything or anyone. His laziness is matched only by his ignorance. He is a man-child with no concept of consequences because he is used to having others clean up his messes and make excuses.

We are told that "Boris is Boris" with a casual shrug as though that were meant to explain or comfort. Boris is Boris, sure. Which is another way of saying he is a conniving, dishonest thieving, boorish snake in the grass. And if you're fine with that in any of the top posts in government then why did you even bother getting into politics?

It would be sad to see Johnson as leader of the Tories because that really would be game over. However, if Tories put him in charge then it is game over for Britain. It is that serious.

The international community understands the power dynamic that Johnson has to be tolerated. They will be patient. If however, this man is the premier of the United Kingdom, representing British people, they will turn their backs on us.

Johnson is no statesman. He is a crass, bullying thug. There is no possibility of any UK initiative succeeding with him as PM. It would send a message that Brexit really is all those ugly things we said it wasn't. Inward looking and isolationist. As to Brexit the only thing Johnson can deliver is a masterclass in Tory misanthropy and a decade chaos.

I have no love of socialism, I have no stomach for the left at all, but I'll take my chances with Corbyn if Johnson is the best they can do. There are at least some internal restraints on Corbyn. Tories have proved they will let Johnson get away with murder.

The message coming out from the Tories is that there is no low Johnson can stoop to that they will not excuse. If that is really where the Tories are at then they have lost their moral base and any semblance of standards, thus are unfit to govern.

Wednesday, 27 September 2017

Keeping up appearances...

Well hello there strangers. You may have noticed that this blog has gone a bit quiet. If, however, you follow me on Twitter then you know I've not been the remotest bit quiet. I've ramped up Leave Alliance content along with a renewed burst of video blogging

As ever the uptake on video blogging is not in the high numbers but it's dry stuff and only really of interest to a select audience. There's no thundering Brexit speeches from this quarter. The strategy is as always - informing the informers.

What I have noted is that Twitter "threading" is a highly effective communication tool with sometimes more than a million daily impressions. That is not to say that a million people necessarily absorbed what I have to say but I think it safe to say it reaches more than this humble blog.

This is not to say that I won't maintain this blog because it is still growing and another useful platform for expressing more complex ideas. For the moment though, its all hands to the pump and theorising over future trade issues is a luxury not available to me at the moment. Much of what I would say has already been said and I will cough up a vital organ if I have to do another post about Norway. As to the daily ins and outs, has it more than covered.

I wish there was actually more to say at the moment but it would appear the job is to keep repeating the same points and seeking out new audiences. Curiously remainers seem to be taking more of an interest as Brexiteers crawl further into their ideological hole. It's refreshing to be taking a different strain of abuse.

As it happens, a lot of Brexit blogging is waiting for things to happen and treading water until something seismic happens. Florence was supposed to be the moment that reignited the issues. It didn't happen. I suspect, however, that I won't have long to wait before there is more going on than even I can write about.

Friday, 22 September 2017

Mrs May's Florence ambush - setting the stage for a walk-out.

I think Mrs May's speech in Florence yesterday was a turning point. Though it was short on detail, it was heavy on soothing rhetoric. This is not out of the ordinary, but the fact it was billed as a game changer and given in Florence (to much fanfare) tells us this is all part of a propaganda stunt aimed at a domestic audience.

Though the speech has been universally panned on Twitter, it should not be forgotten that Twitter is largely a bubble where hacks interact with each other to the exclusion of all else. The layman and the party faithful, however, will see it only at face value - an ambitious and reasonable offer to the EU. In politics you only need fool some of the people some of the time.

The speech, though, is an ambush. Because of the technical nature of Brexit, the EU first needs the procedural elements completed as per the Article 50 sequence. There is nothing in Mrs May's speech which addresses any of the phase one issues or adds any weight to the position papers thus far submitted. Thus, there is nothing the Commission can say apart from a reiteration of that which has already been said for the billionth time; rhetoric is insufficient.

That means Mrs may can now play the "unreasonable and inflexible" card - painting the EU as the obstacle - while the right wing media messages that same narrative. In effect the government is giving the Commission the runaround by failing to engage in talks at all. Even our position papers have been insultingly shallow - and probably not by accident. This is to maintain the illusion that serious negotiations are underway. This explains why May felt it necessary to say that we have already agreed in a number of areas when in fact nothing has been agreed at all.

It rather looks to me like the stage is being set for a walkout - and one which has been planned for some time. At the very least the Commission's rejection of May's "offer" will give her the capital she needs to play it tough to the home crowd at the Tory conference. Meanwhile, the media have fallen for the decoy, trying to read the runes with regard to the future relationship. They have failed to spot that the speech is deliberately short on detail. This was not intended to bring any clarity to the proceedings. Quite the opposite. This is a political ploy.

Monday, 18 September 2017

Another Brexit timewaster

I am told I would be more effective if I limited my criticisms to the arguments and not the people. There is a certain cowardice in that position because people and their behaviour are very much at the centre of the problem. If it isn't the twisted mental contortions of Andrew Lilico or the outright lies of Boris Johnson and the Brexit Taliban, then it's ambitious social climbers whose opinions turn on a dime.

Then there are the wafflers and timewasters. A prime example of such being Henry Newman of Open Europe, unsurprisingly airing his ignorance on Conservative Home. Typically he sets up the EEA as the straw man...
What we do know is that the Government has ruled out the exact same relationship as Norway or Switzerland: the Lancaster House Speech made clear that we would leave the Single Market. And that hasn’t changed. The Treasury, however, seems to favour a position that leaves us just outside of the Single Market – the so-called “EEA minus” position. Their proposal would entail locking the UK in a regulatory ERM. We would technically be outside the EU and its Single Market, without a seat around the table or ability directly to shape regulations, but bound to implement all the EU’s rules and regulations anyway, other than if we made special pleading in a few exceptional cases.
Readers of this blog or any other with a command of the basics knows these mischaracterisations of the EEA option to be deliberate. These zombie arguments don't seem to die - but that goes with the territory. And then something else that goes with the territory is this... 
The Treasury is inexorably pushing Whitehall towards a Brexit that would limit our chances of ever seizing new opportunities outside the EU. It’s almost as if their aim is to prove Jean-Claude Juncker right – to show that Britain would have a worse deal outside the EU than we do inside. But there is an alternative: placing Britain further towards the centre of the spectrum between Norway/Switzerland and Canada. This would ensure the UK’s right to regulate our markets, and still leave the possibility of opting to adopt some of Europe’s regulations. Ministers need to be candid about the costs of such an approach, but also open to its potential benefits.
And this is where I lose all patience. Time and again these morons pluck things out of the air with no idea what they mean or any idea how to implement them. We've heard all of this before. EEA lite or WTO plus or Pick'n'Mix as though EU relations were a counter at Woolworth's.

For the uninitiated (not that you have any excuses by now) when Brexiters refer to a Canada style deal they mean an FTA in goods with a few added extras. The proposal here above being something that borrows from all the options on the table - which would effectively a bespoke mish-mash of bilaterals encompassing everything from goods to Euratom and Open Skies. As much as Newman has no idea what that even looks like, a destination without a roadmap is entirely worthless.

But in all likelihood the purpose of Newman's article is not to offer a vision on the way forward - rather these are weasel words to position himself between camps in the run up to the Conservative conference. It all sounds very reasonable to the non-thinking fraternity and is calculated for that very end - thus Conservative Home is once again engaged in manipulating its audience.

Sadly we are going to have to put up with a lot of this before, during and after the conference. The temptation is to expend energy debunking it but this is a fever that will have to burn out of its own accord. It is not deserving of serious attention.

Sunday, 17 September 2017

In the belly of the beast

Ironic it is that I have spent much of the week exalting the virtues of independent blogging while not actually having written anything at all. I do, however, have something of an excuse this week in that I've been out and about in London on Leave Alliance business.

In any case, nothing has changed. For all the noise we are still nowhere, with little more than partial leaks and speculation to go on with the occasional decoy thrown in for good measure. Not until we see what Mrs May's Florence speech says next week will we have any more of a clue. And even then, there are no guarantees. 

It's actually telling that I should have been invited to do The Times Brexit podcast. Ordinarily to the legacy media, the blogosphere does not exist, but even they're so stuck for fresh material they will reach out - if only for the free content. It was, however, an interesting distraction and a chance to see inside the belly of the beast. 

The purpose of my visit to London, however, was to visit the Institute for Government for an informal chat on trade and international organisations. For those not aware of their work, the IfG is a non-partisan governance think tank doing a fairly competent job of breaking into Brexitology. They produce some adequate briefings for the layman, and though vastly superior to the output of Tory think tanks, their desire to stay neutral makes their material sterile to the point of being inert. 

It's not until you see their operation that it becomes clear why. The IfG is based in exclusive offices just off The Mall. Their outfit trades entirely on prestige. The illusion of importance. A confidence trick. It's all about putting on big name events and conferences, stroking the egos of nonentity politicians and releasing reports to set the agenda for the day.

If they want to stay in business they have to play the game and be cautious with their criticism. If they upset or offend then pretty soon senior politicians won't turn up to their events. That's how the game works. But that's actually how they end up saying nothing and accomplishing very little. For sure they have a steady stream of notable politicians darkening their door, but without robust criticism it is largely the bubble speaking unto the bubble. 

One feature of the Brexit debate is a number of similar organisations producing dozens of reports, all of which are forgotten within a day of publication. Many of them do not expand the debate nor do they add much to what we already know. It would seem that their only business is to stay in business - to remain at the centre of the bubble for its own sake. 

Though we have heard much over the last few years about "the establishment", this is as establishment as it gets. The network of London think tanks make up the core of polite society where the dead hand of decorum means that there is no quality control whatsoever. The system is its own insular universe of mutual praise so there is no quality control at all. Everything everybody does is "marvellous" and "brilliant". We don't call 'em metro-luvvies for nothing. 

This goes someway to explaining why I am not well received online in that I say all those things that one is not supposed to say, and do not offer unwarranted praise. Privately I am told by many that they agree with what I say but cannot be publicly associated with it. It wouldn't matter if I sanitised it, I'm just saying inconvenient things and in the bubble any criticism is "impolite" - but more importantly, a commercial risk. 

But this is why the output from think tanks tends to be so lacklustre. They won't say what needs to be said in no uncertain terms. It needs to be said without hesitation or reservation that the government's current strategy is entirely wrong-headed, and that the consequences of a no deal Brexit can hardly be overstated. It must also be said that the inane and singularly crass economic theories of the hard Brexiters are nothing short of negligence bordering on lunacy. 

But there is another reason the bubble debate is so utterly shallow. Half of the politico-media bubble is run by unsupervised children. There is no premium on quality research. Interns and junior wonks are cheap - good for looking up facts and figures - and that's what they think research is. They can cobble together factual reports - but there isn't the breadth of experience or maturity to bring any real insight to it - or to see any of the strategic opportunities that good research creates. What they produce is forgettable PDF fodder. 

It is not my intent in any way to denigrate the IfG in that they are as good as that system is ever going to get - but this dynamic is entirely typical of London think-tankery - which is entirely dependent on bright young things of a certain ilk. The PPE master race. This also extends to our media where leader articles for international flagship newspapers are written the office juniors. The political apparatus is the same throughout as Oliver Norgrove confirmed to me.  

Of course I did not need to go to London to learn this. I've been around the block a few times and had my introduction to this world before thanks to the late Helen Szamuely. It is from her I learned my healthy disdain for Toryboys, wonks and apparatchiks. All the same it was interesting to view it through more mature eyes. 

At one time in my life I might have been star struck by a prestigious office at the heart of the machine, excited by the prime minister's police motorcade dashing by with a sense of purpose and urgency. Now I view it with wry amusement. It's all a facade. Every bit of it. I hate Westminster that little bit more every time I am pulled into its field of gravity.   

Now that I'm knocking on a bit, in my late thirties, London leaves me too tired to even think. But I guess that explains its political inhabitants. And for once I don't mean that in a sardonic and disrespectful way. It really does beat you up. A meeting here, a presentation there and then media interviews for the rest of the day. You cover a lot of mileage. You barely even know what is going on in the news while you're out and about, let alone able to form a coherent opinion on it. When you get home, all you want to do have a large glass of wine and hit the sack.

This goes someway to explaining why MPs are so hopelessly reliant on the legacy media and parliamentary briefings for information. And this explains why MPs haven't a clue between them. Who is writing the news? Who is writing the briefings? Think tanks!

The dynamic is made worse when MPs have only a very short attention span and only a limited window for absorbing information. You have to break complex issues down into the basics so they can be communicated orally. That doesn't work even at the best of times since they hear so many conflicting views, but when we are dealing with something like Brexit, coherence is next to impossible. Not least since MPs agree with the last person they spoke to and the think tanks aren't even getting the basics right.

Ultimately the system is broken. The inputs don't work. You can set the agenda for the day if you have certain assets at your command - but that's literally all it achieves. It doesn't contribute anything. Thus these think tanks are just stepping stones for bright young things to have a career in media and politics - only to become not-so-bright, not-so-young things running The Daily Telegraph and The Spectator. 

In the end, the work has to be done from outside the bubble and fed into the system through brute force. This is what we did with Flexcit and this is how The Leave Alliance continues to punch above its weight. A band of bloggers don't need an SW1 address and don't have the distractions of life in the bubble. No useless meetings to attend at the other side of town.

They say we could achieve more if we were less "abrasive", not offending and not speaking out - but what does that achieve? The bubble dwellers are all very professional and polite to each other - but because they won't call out folly and corruption where they see it, the Legatum Institute snake is coiled around the throat of government. It's the elephant in the room. The IfG knows it, The Times knows it, and I'm absolutely certain the Telegraph is in on it. It's the biggest open secret in Westminster - and nobody is talking about it. 

And that's why they don't like bloggers intruding on their territory. Not only do we see the elephant, we have name for it, and we are breaking the rules by being impolite. They tell us we will get nowhere - but we are still here, still shaping the debate - and we are not going away. 

Monday, 11 September 2017

Smelling like a set-up

Today our friends at Legatum Institute published their proposal on how to handle the matter of the Northern Ireland border. Ordinarily these such reports are forgotten within twenty four hours of publication, but as Legatum are the sole advisers to the Tory Brexiteers, what they say becomes currency in the debate. What they say tends to linger like a bad smell.

The only use this particular report has is as a crystal ball to tell us why and how Article 50 talks will stall. A Legatum report will become the backbone of UK position papers.

The report in question is more or less a micro version of their broader approach to trade which assumes that the UK can have bespoke mutual recognition agreements on standards and conformity assessment along with the ability to diverge at will without consultation. Categorically this is not going to happen.

They also assume that the customs controls on the border can be replaced with behind the border controls based on advanced technology, some of it barely in its infancy. This would be a stretch even if there were no time constraints.

As outlined before, the only way we can ensure an open border in Ireland is to replicate as much of the existing regulatory infrastructure as possible - and since the customs aspects of these arrangements will be unprecedented exceptions the whole settlement will have to be an NI specific special status.

The reason for this being that the NI border also becomes the EU's outer frontier - which we are effectively proposing to demilitarise (for want of a better word). No such arrangement presently exists anywhere in the world and were the EU to make exceptions for the UK in this regard it would have to make the same exception for all. That is how the rules based system works.

This will not be an easy feat. For it to work, the UK needs to present proposals that take account of the EU's technical and legal constraints. Pie in the sky proposals with no acknowledgement of these realities will fold immediately. We have to meet them half way.

The EU is amenable to realistic proposals and will bend over backwards to make it work but one rather suspects Legatum is up to no good. To me it looks like a ploy, presenting something so unworkable, but plausible to the novice, that the EU gets the blame for inflexibility. This could be the pretext for a walkout.

Ultimately the Tories have got it in their heads, largely thanks to Legatum telling them what they want to hear, that we can patch together bespoke and untried instruments without regard to the obligations and commitments that come with customs cooperation. This is simply not a serious proposition and categorically cannot work.

I've been watching the chatter on Twitter and elsewhere today and no trade analyst I hold in any esteem thinks Legatum is even on this planet. That is actually nothing new for London think tanks. They are all dominated by political chancers and frauds. What should worry us is that the Brexiteers have effectively privatised trade policy and outsourced it exclusively to Legatum because they make soothing noises. As corrupt as it is, it is also dangerous. If this is what is informing the government then we are very much in trouble.

Thursday, 7 September 2017

Trade must always be subordinate to democracy

I do not seem to be able to learn the lesson that one can disagree with something and just ignore it. Consequently I have committed myself to blogging a piece by Professor Paul James Cardwell in Prospect Magazine. His contention is that "The free trade case for Brexit is folly and crucially, it is new. Eurosceptics never used to buy into it".
“First of all, leaving the EU gives us back control of our trade policy, and gives us the opportunity to maximise returns from free trade.” These words were spoken by David Davis on 11th July last year. Post-Brexit, getting trade deals with countries the world over has become the new mantra. The prime minister’s visit to Japan last week brought this into sharp focus. But getting new trade deals (and getting them quickly) seems to have become not just a consequence of Brexit but a reason for doing it. What is puzzling is where the desire for an “independent trade policy”—as Brexiteers call it—has come from so suddenly.
To save reproducing the whole text I would recommend a read of the whole article. Cardwell examines UK government sources such as The Balance of Competences Review in 2013, the Conservative Manifestos and Vote Leave tract. Probably the last places I would look to ascertain the pedigree of eurosceptic views. 

In eurosceptic land I can't ever recall a time when Eurosceptics weren't banging on about trade. Euroscepticism has always built itself on the Glorious Revival - ie "restoring links with the Commonwealth" and latterly Anglospheric models such as CANZUK. These mantras about "trading with the rest of the world" are as old as euroscepticism itself. In fact, if I grab any piece of Eurosceptic tract off the shelf I am sure to encounter the phrase "the EU is a protectionist racket". 

But then this was always from the Colonel Blimp quarter of euroscepticism - and much of the material circulated via mail groups and A4 pamphlets long before the mass adoption of internet. All that, though, has since been buried as Ukip popularised itself on the issue of immigration - leaving the trade to be pecked over by the "free market" Tory think tanks. Namely the Institute of Economic Affairs. This is where the crackpot Minford theories come from, which again are as old as euroscepticism. 

That wing of euroscepticism has always been obsessed with tariffs and the costs of regulation - and being that regulation is a facet of trade, repatriating trade policy is a prerequisite to the much vaunted "bonfire" of it. A eurosceptic canard that goes back to the dark ages.  

Though "red tape" is a recurrent piece of right wing scripture, and bread and butter for the tabloid press, it has always been the obsession of the ultra right who have been in the political wilderness for twenty years or more. They who viewed Cameron as a simpering leftist. That is why you won't find it in any recent Tory manifesto. 

Interestingly though, there has never been a unified view on trade issues in that Euroscepticism has always used whatever stick available to beat the EU with, whether it be consistent or not. Consequently there has always been a strong vein of protectionism in Euroscepticism when convenient. 

It is interesting that Cardwell mentions The Referendum Party which was "according to Zac Goldsmith, founded by his father due to his opposition to EU law applying in the UK and the supposed assault on “ancient English civil liberties.” Nothing to do with global trade". As it happens, James Goldsmith used to talk about trade quite a lot and, interestingly, he was fiercely anti-trade liberalisation. Then on the left of Euroscepticism there has always been an economic nationalism.

There has always been a schizophrenia in euroscepticism where "free trade" was good, just not European free trade - because, obviously, anything to do with the EU is bad, even if it's good. The issue of trade, however, has always been an implied issue in the debate, in that the roots of euroscepticism boil down to one concept alone - sovereignty. 

What Cardwell has latched on to is the sudden popularisation of "free trade" but this really isn't anything new. It has always been part of the narrative that we are "shackled to a corpse" and leaving the EU could herald a new era of buccaneering free trade. That was the carrot we always used.

Since the referendum free trade has become a central theme in that it is a necessary device for the ultras to push for hard Brexit. It is a tacit admission that leaving the EU will come at the cost of some European trade and this nebulous concept of "free trade" will miraculously fill the void. 

Cardwell is right to note, however, that eurosceptic interest in trade in the more specific context of EU FTAs is a recent thing. This is more political opportunism in that right wing eurosceptics noted some rumbling on the left about TTIP and something called ISDS. If the left saw it as something inherently evil and something that threatened the NHS, then it was an obvious issue to adopt. It was always understood that a mandate for leaving the EU could not be won without winning the backing of the old left. In the same vein, the right were never especially interested in the fate of Greece, but if the left were raving about it, it was a handy device.

In fact, it would be correct to say that eurosceptics have never really cared about anything in politics except for leaving the EU because we're all monomaniac bores with a sovereignty fetish. When you are convinced that the EU is the root of all the problems, the problems themselves become less interesting - and the sole mission is to attack the root cause with anything that comes to hand. That's why there has never been any real consistency in euroscepticism. This is also why most of the popular leave case collapses post-referendum. 

The reason the hard right have nothing to bring to the table is simply because they've never bothered to update their views or understand the issues. This is why there is such intellectual poverty in Tory think tanks. They are the dog that finally caught the bus it was chasing. 

Ultimately the eurosceptics have been fighting the EEC for thirty years and are not now intellectually equipped to handle the process of leaving. The EU is a beast that crept up on them and it is not one they understand. They don't know exactly what they do want, only what they don't - and if there is an answer it must have something to do with "free trade" - whatever that means. 

But ultimately, in taking such delight in Brexiteer disarray, Cardwell gets ahead of himself because there is actually a very sound rationale for taking back control of trade. 

Cardwell makes note of the common critique that "deals concluded by the EU are substandard because they have to satisfy 28 member states and can be vetoed by any one of them (as we saw with the Walloon Parliament on the Canada deal)". But this misses the point, says Cardwell. "Any form of comprehensive, bilateral deal takes a very long time: there is no evidence of any “quick” deals between major economies. And the more ambitious the deal, the longer it takes. The fact that the EU’s internal ratification process is lengthy is something of a red herring".

I disagree. It is an entirely valid criticism that FTAs are bureaucratic, cumbersome and prone to failure. Years were invested in TTIP for it to fall flat, CETA had whole tracts removed from it in order to pass, and the EU has a habit of counting its chickens before they hatch. Cardwell is right to say that any form of comprehensive, bilateral deal takes a very long time but when you do have to clear them with 28 governments the scope for failure and dilution is magnified many times. 

But actually, everyone is missing the point here; the Brexiters, the remainers and indeed the EU. This actually points to the folly of ambitious and far-reaching FTAs. They make for good headlines and they serve as propaganda set pieces, but the more intelligent way to go about trade is through unbundling, seeking out sectoral agreements and establishing global standards one product at a time. 

To be able to do this, the UK needs to be able to pick and choose its alliances in all of the top regulatory forums and if bound by EU membership it has no independent vote, no right of reservation and no right of initiative. If we are to modernise our approach to trade, moving beyond the dinosauric FTA, then leaving the EU becomes a prerequisite.

It is a depressing facet of the debate that the FTA has become the holy grail of trade. Keeping score between the EU and the UK on how many FTAs they can each pass is not the measure of Brexit success. This is a remainer paradigm and it is one writhing in incomprehension. Big and comprehensive FTAs are largely the domain of regulatory superpowers with large markets and our ability to play that game will be limited. 

The UK will have to look at entirely new approaches and everyone concerned is going to have to come to terms with the fact that FTAs are not the only instrument of trade. One of the most seismic agreements in modern times was not an agreement between any bloc or country, but an accord between standards bodies. MoUs and cooperation agreements involving UK expertise can put us at the forefront of regulatory innovation. Notwithstanding Brexit, BSI is still a major international influence. 

Furthermore, as we repatriate trade, we also take back control of a major part of our aid spending, allowing us to reintegrate trade, aid and foreign policy where we can look at trade facilitation measures, working with a whole spectrum of international organisations to secure and increase the profitability of value chains. If we fall into the trap of assuming FTAs are the only measure of success then we are setting ourselves up to fail. 

As far as FTAs are concerned, the UK should be primarily concerned with carrying over existing relations we enjoy via the EU and negotiating a mechanism for opting into EU FTAs as and when they arise. After which the UK needs to look beyond the myopia of the FTA paradigm and look at navigating the upper tiers of the trade and regulatory ecosystem to its advantage. As an independent player the UK can be more agile and more creative. 

Ultimately though, the modern FTA is far from just a trade deal. Increasingly they require the selective pooling of sovereignty and establishing mechanisms for regulatory harmonisation. Consequently any deal is yet more trust invested in systems that facilitate the automatic adoption of rules and standards. This puts governance on autopilot whereby we find we are adopting standards and regulations by way of statutory instruments without scrutiny or debate. 

The scrutiny that does happen is way off the radar, not in the public eye and very often escapes media attention. Every trade deal has its own chlorinated chicken and it's only the more controversial aspects that receive any real attention. This has always been a negative feature of EU membership in that we have continually adopted rules without forewarning, destroying businesses at the stroke of a pen, with no real safeguards and no means of reform.

Now that the EU is expanding the scope of its trade exclusivity and is increasingly adopting its regulations from the private regulatory sphere, little by little we are witnessing the establishment of a global single market of private legislation where the torch of democracy never shines. As much as the EU has never really been an adequate safeguard against sweeping globalisation, the problem is set only to get worse. 

We are told that trade liberalisation is near universally good, but sovereign peoples must have a means of control and the right to say no. To continue on the path of ceding ever more sovereignty is every bit as bad as Patrick Minford's theorem of unilateral trade liberalisation. It removes the decision making from government leaving us to cope with the fallout without ever having been usefully consulted. 

The case can very easily be made that the repatriation of trade will lead to a slowdown in trade liberalisation, possibly resulting in a drop in living standards, but this is not entirely an economic estimation. It underestimates the value people place on having some degree of control and not being subject to the whims of market forces. Trade liberalisation has externalities and consequences for traditions, heritage, social cohesion and landscapes and, rightly, the public feel that not everything is to be sacrificed on the altar of commerce. 

Sovereignty and control are not dirty words. They are essential to any functioning democracy. Consequently, taking back control of trade is a requirement of Brexit. Moreover, it is not preordained that our exclusion from EU FTAs necessarily harms our future trade - especially if you look at utilisation rates in any real detail. There is nothing to say that UK specific optimisation of existing FTAs cannot be beneficial. 

It is right that we put Brexiteer free trade claims under intense scrutiny, but the fixation with FTAs and the fatalism of remainers is based on a similar level of incomprehension. Ultimately Brexit is about bringing decision making closer to home, shortening the chain of accountability and giving people a real say over things that directly impact their lives. For eurosceptics the watchword has always been democracy - and a nation not in command of its own trade relations is not one in control of anything. 

Wednesday, 6 September 2017

Brexit: unleashing a wildfire

Defending Brexit is not the easiest thing to do at the moment when we have a government hell bent on delivering the worst case scenario. It also doesn't help that the Brexit groupthink produces pretty feeble economic justifications rather than looking at the issue as a whole. Fighting on the enemy's turf is always a loser and the mainstream Brexiter economic justifications are collapsing

I have argued for a long time now that the economy is a secondary concern - and as far as that goes, the aim of the Brexit process should be to minimise what is bound to be economically stressful. Something this government is failing to do.

But then, I repeat, this isn't an economic question and it never was. It is political, cultural and constitutional. It is said that Brexit has divided the nation but in fact all it has done is exposed a deep cultural chasm that was not being addressed by the status quo. There is a gulf of misunderstanding between the factions and it's time we dragged it all out for examination.

When we look at that we find that it stems from a collapse of trust in UK institutions. And that can hardly be a surprise. Every major increment in EU membership has been done by subterfuge and deception. Direct consent has never been sought and our interactions in the EU have been yet more deception. Cameron's phantom veto and the bogus attempts at reform were quite obvious pieces of political theatre from an establishment with no regard to the wishes of the public.

This opens up broader questions as to whether the EU is dysfunctional or whether our own "democracy" is failing. I'm going to say both, but even if I sided with the remainers in saying it is a problem entirely with UK democracy, I would still choose to leave on account of there being no defence mechanisms or restraints on what the government can do to us in our name - especially in relation to the European Union. Brexit is an overdue corrective.

As much as the various ratchets in our EU relationship have left a scar on the psyche of the nation, I do expect that Brexit will do the same - and that will shape our future decision making. If nothing else we have lodged the issue of sovereignty and control into the political discourse and the lessons will inform whatever happens next.

I also expect that we are due for a deep and thorough clean out of politics. Neither party enjoys the confidence of the nation right now and Labour is only going to form the next government simply because the Tories will have to be punished for delivering a mess of a Brexit. There is no way that can last.

Ultimately politics has to find where the new centre is. It's too unpredictable now because Brexit has a polarising effect. One suspects, though, with a majority disapproving of the way Brexit is being handled, the far extremes are not in good standing with the country. A new order will have to establish itself and that is a very necessary thing.

What we can say is that things will have to get a lot worse before they get better. Brexit is poised to be a shambles and I have a feeling the next government is going to be worse than this one. With the Brexit vote we have bought ourselves a decade of political and economic restructuring.

As to what the new economics looks like, I really cannot say. It could well be that the remainers are right and that Frankfurt becomes the financial centre of Europe, leaving the UK government with fewer tax receipts to play with, triggering some more fundamental questions about what we expect of government and what it can realistically provide. I'm not going to complain about that. What it is certain to do is pop a few bubbles and open up a few doors.

After about ten years we should have established a base competence in trade matters and certainly the Brexit process will be a baptism of fire. We will have restored trade as part of the national political discourse and it will refocus political debate for the duration. The public will demand that the promise of more trade be kept, somehow, and that will be the obligation of any post-Brexit government.

With any luck this should see a renewed sense of focus and purpose in government, and it is my hope that we'll then see devolution of some of the functions that Westminster has confiscated over the years as displacement activity under EU rule.

Right now it's all looking and feeling pretty bleak. I share some responsibility for what has been unleashed and the toothpaste is out of the tube. It's not a good feeling knowing that what we have unleashed cannot be controlled. But then I remind myself that this isn't over yet and even when it's over, it isn't over. Politics is a continuum and the fight will go on for as long as it takes to reshape Britain as an independent democracy.

Ultimately Britain entered a new era at the end of the Second World War. A new order of British socialism was established, a new era of European relations was born. That settlement belonged to my parents generation. A hyperglobalised new world where the very nature of commerce and communication has changed requires a wholly new settlement - and a politics more befitting of the internet age. We have undergone a technological and cultural revolution but Britain hasn't had a political revolution in decades. 

This is why I won't make an economic argument for Brexit. Revolutions are not known for being economic necessities. They are entirely political, and economics always takes a back seat - because it has to. My case is simply that Britain must reinvent politically lest we be locked into a gradual managed decline. Culturally and economically.

Those who hold the real power and those with the most to lose from Brexit will continue to make this an entirely economic argument. If they can win the economic argument then they may forestall the revolution that threatens their political control. They may not be in office, but their stranglehold on the narrative and public institutions is as strong as ever it was.

As it happens, I think the remainers are fighting a forlorn hope. What's done is done. I don't see that they have any opportunity to stop this chain of events, and polling would indicate that there has been no significant shift in attitudes. There can be no going back so now it is a question of opening a new dialogue as to what the new Britain is going to look like and who is going to run it. On that score I will probably have more in common with remainers than those on the hard right.

It may well be that Britain sacrifices a good deal of influence and prosperity for having done this, but those arguments will ring hollow. Britain's influence in Europe and beyond is not exercised on behalf of the people - and a poorer Britain could in many ways lead to a healthier society. Britain has a soul sickness that prosperity cannot cure. Collective affluenza you might even call it.

What I am sure of is that we could not have continued as before with half the country ignored, despised and rejected by the wealthier half. They say that Brexit is Britain turning inward. I can argue that it isn't, but in some ways it rings true. I don't mind. I don't see that a little introspection is necessarily a bad thing. A little reappraisal of who and what we are can go a long way.

It would be a bonus if we can get through this without the Tories torching all of our trade and good relations with the EU, but as just about everybody is keen to remind me, that was always a risk and one I opened the door for. I can live with it. Democracy carries risk and the alternative political stagnation was not without risk either.

It would appear that what remainers object to most is the inconvenience and the perturbation. That much is not my problem. They can either get with the programme and be part of the renewal process, or they can sit on the sidelines and do what they do best; whinge. I'll just be getting on with it. Brexit is now ours to define. Opt out at your peril.

Tuesday, 5 September 2017

The Downing Street suicide pact

Probably for the first time in my life I am very seriously worried by what the government is doing. Worried is a word we use all too often but it has taken on a new meaning for me of late.

There is no doubt in my mind that a no deal Brexit would be unimaginably damaging to the UK. No responsible government should allow it - and a functioning government apparatus would be so acutely aware of the consequences that there would never be any question of allowing talks to fail.

This, however, is where we are headed. This government is playing games and its attitude to the EU is completely inappropriate. Bizarre even. David Davis has misread the EU completely. He is absolutely convinced the EU is only in it for the money. He thinks EU is mounting an elaborate sham simply to extort the maximum amount of money from the UK. There isn't the slightest understanding of the EU's position, its limitations and constraints.

Were that the reality, seeing it in those terms, with the EU cast as the playground bully, it makes sense to make a robust, principled stand. That's what they think they're doing, but it's based on a child-like appreciation of what the EU is. It has no foundation in reality. They have literally created a fictional narrative and are then basing all their responses and decisions on that. There is no logic to what they are doing. Their entire response is based on something which is not real - thus it can only fail.

At the centre of this is David Davis, unimpeded by Theresa May who is not in command of the events or the issues. One suspects May's influences are being heavily policed and she is not getting impartial or even realistic feedback. She has no grasp of Brexit or indeed the consequences and the Brexit Gestapo and making sure it stays that way.

The consequence of this is that we will continue to misdirect our efforts over what ought to be the least difficult part of the process, wasting time we don't have. I rather suspect it is on this issue that Davis will launch a grandstanding stunt. They have convinced themselves that there is no penalty to the WTO option and that, in any event, within days of telling the EU where to go, the "colleagues" will come crawling back giving us everything we want.

This is not going to happen. The EU is not going to tolerate that kind of stunt and if collectively they feel that the UK is not going to engage then there is little point in prolonging the proceedings. The plug will be pulled.

So fundamentally out of kilter is our approach that there is little likelihood of a last minute change of attitude. The conceptual misapprehensions at the heart of government cannot be remedied. There is no feedback mechanism and they function in an alternate reality. Reality cannot intrude. It doesn't even have a visitors pass.

It is therefore of some concern that Brexitologists are distracted and churning over the decoy material. There are a number of leaked papers keeping them occupied, scanning for any hint of coherence. There won't be any and they are wasting their time. UK position papers are seriously deficient and entirely unrealistic. This government simply does not understand that the EU is an amalgam of integrated and interrelated systems. Without recognition of that fact any disparate proposals can only fall flat.

The problem is that government is not consulting any wider than a narrow pool of spads, none of whom grasp the technical issues. Any proposals need to be compatible with the EU's systems and aims - not abstract "blue sky" policy. That means technicians should be steering the proposals, not political advisers. They are not up to it.

Again though, this cannot be corrected. Expertise is unlikely to be consulted because that is the last thing the Brexit Gestapo want. They do not wish to be told that this approach cannot work. They have set about doing it their way and consequences be damned. It therefore seems that the chances of success, or even survival, are remote. Our only hope now is for this government to fall.

Sunday, 3 September 2017

Davis: Penny wise and pound foolish

They say history is written by the victors. This makes me wonder how the history of Brexit will be written when there are no clear winners. The finger-pointing and blame games will become a part of the story.

One tries not to be too pessimistic but one is not given over to the self-delusion of Brexiteers. There can be no ducking the reality that this is not going at all well. At the centre of this unfolding mess is David Davis, who ultimately does not comprehend the gravity of these talks or indeed the price of failure. Anyone with a realistic grasp of our position would be taking a far more measured approach with the necessary humility.

The underlying problem is one of mentality, where Davis is treating this as a legalistic undertaking rather than a political one. While nobody is keen on paying more than we have to, the debate over our exit settlement has lost sight of the fact that we are seeking to safeguard a £240bn a year trade relationship.

As puts it, going over it line by line to check the totals is penny wise and pound foolish. This is less to do with what we want to pay for as it is to do with what we have already agreed to pay. If we end up paying for a bear breeding scheme in the Pyrenees then that is a question for those who rubber-stamped it to begin with. If such lurid stories are indeed true, that is.

In that respect the media is helping to reinforce the notion that these discussions are a matter of accountancy - when in actuality this is a question of leaving our relationship in good order so that we can move on to the next and more pressing issues.

This prompts cries of "blackmail" from the baying Brexit mob, when in fact, keeping these issues contained in an exit settlement, as Mike Galsworthy observes, is to avoid a situation where either side can employ these issues as devices of blackmail. In future trade talks the last thing we want to be doing is dragging settlement issues back on to the table, potentially derailing the whole process.

Sadly though, this whole process has been misconceptualised by both the government and the media as though is were an adversarial showdown - trying to sex up what should be a fairly straightforward, amicable and tedious affair.

Looking at the bigger picture, the very last thing we wanted to do was get bogged down in the details of the financial settlement. For the most part these are concerns we would be paying for anyway - and anything over an above that is inconsequential next to the value of our European trade.

Choosing to make issue of this eats away at valuable time we will need to resolve the thornier issue of Northern Ireland - when already we have wasted months. You can be forgiven for thinking this is a deliberate ploy to give the EU the run-around, with Davis having no intention of seeking a deal of any kind.

In effect, Davis is the one blackmailing the EU, knowing that a sudden death Brexit could inflict serious damage on the EU. There can be no doubt that it would seriously interrupt the EU, but not irrecoverably - and the UK would be the biggest loser. Davis is playing a weak hand badly. A zero sum game.

As this farce evolves we can already see the moves to blame the EU for its "inflexibility" and it really is working a treat. The Brexit zombies are falling into line and this is becoming the narrative among the party faithful. In that respect the Tories are seeking to hoodwink the British public into a no-deal Brexit.

One suspects that this narrative will hold out just long enough for Davis to pull a fast one - but that is not how history will be written. History will record that the British people were led over the cliff by ideological zealots who never had any intention of a negotiated exit. Davis will go down in history as the man who trashed British exports and demolished our international credibility. It will not speak kindly of those Tories who allowed it.