Tuesday, 18 December 2018

Brexit: Resigned to the facts


I was considering writing a long article on how a no deal Brexit plays out. I thought better of it. We have been through this mill countless times. There's no point.

I have often questioned the utility of Twitter. I've been on it almost every day for four years now. I have watched every twist and turn of the public debate and bore witness to every twist and turn. I have seen every combination of every stupid argument - and I have seen the lengths people will go to to deceive themselves. I have seen breathtaking dishonestly and bloodcurdling lies. From all that the one thing I know is that when it comes down to it, most people will believe what they want to believe.

As we draw closer to the moment of truth, the rebate reaches fever pitch - to an intensity to rival the last days of the referendum. Minds are not going to be changed. If anything the debate is regressing. The only relief is the knowledge that in a hundred days this will all be over and we will see who is right. It's my best guess versus your best guess.

My best guess is that forty years of technical and legal integration suddenly unplugged overnight will cause many of the problems we anticipated and many we did not. We have seen through the course of Article 50 talks how the EU will close ranks on the UK, we have seen how it will prioritise its own legal order over an above real world outcomes and there is little reason to believe it will be any more pragmatic after the fact.

Moreover I place my faith in the analysis conducted by EUreferendum.com. Being Richard North's son I know how he thinks. After every sentence he's thinking "Can I argue this point?", "Does this hold true?". He is not man trying to convince anybody of anything. He is a man who simply wants to know. He writes to understand and the blog is your invitation to observe. A man of ruthless self-discipline and unmatched intellectual rigour. He can get things wrong when it comes to political predictions but on technical issues I will take his word for it over any of the slovenly con artists in the ranks of the Brexiteers.

And though I do defer to his work, I recall that I've served this cause for twenty years and know a few things if only through hazy recall. I also know how trade works. This is not from following prima donnas on Twitter. Long times readers can attest to the fact there is an audit trail here of a deep study into how they system works. Like my father I do not see this as a game. I do not see it as my role to dredge up a piece of trade technobabble to counter the latest remainer scare story. I simply want to know for myself.

We can argue that in the event of no deal, with meticulously executed planning, the UK can avoid many of the headline impacts. We have left it too late though. Moreover, the notion that no deal is mitigated by a series of subsequent mini deals gravely underestimates the depth and complexity of the remedial measures we would have to take. We would need an EU approved fisheries plan to resume trade and we would be looking at lengthy negotiations to re-establish air services agreements. Brexiters seem to think this can all be scribbled down on a napkin.

Repeatedly I am assured that EU member states still want to do business with us. I am sure that they do - but there is a certain presumption at work here - that the EU will ride roughshod over its own system of rules and that it won't use its leverage to extract concessions from the UK. I am also highly sceptical of the notion that we are able to reciprocate against any new barriers to trade.

Moreover, I've studied the Ultra Brexiters - both the leaders and the grass roots. They are blinded by their faith. Most of them have fallen for the expert misdirection of the propagandists. Still they trot out the same banale tropes about tariffs, completely ignoring the bigger issues - because it's complication and they simply don't want to know. Their worldview is built on a series of decades long assumptions that make up part of their identity and much of their social setting. Letting go of it is just too hard.

I'm well aware of this dynamic. I once thought as they do - but when you've successfully challenged your own dogma there is no going back. Once you let reality intrude everything becomes a lot less certain. The ultra Brexiteers have never had to reconcile the intricate trade-offs because never once have they recognised the dilemmas exist. The arguments made by Brexiters for no deal are almost entirely based on blind faith and they have shown a cavalier disregard for the consequences.

I myself have flirted with the idea of no deal simply because part of me is resigned to it, and part of me thinks it's necessary, if only to blow a hole in British politics as we know it, but I have never once pretended it is not without grave economic and social consequences. It would be just reward for the remainers whose petulance and dishonesty has led us down this path. It will also explode in the faces of the ERG MPs. It will bring about a crucible. A long overdue political reckoning.

That, though, is the only thing going for it, for which we will pay an unimaginable price. Politically, socially and economically, it will take decades to recover. There are no sunlit uplands, no fast lane of international trade unshackled from the binds of the EU. Even if we avoid the headline impacts of leaving without a deal, we are still frozen out of European markets.

I good go to some lengths to evidence my claims but if there is one thing I know as an experience publisher, the more detailed your argument, the fewer people will read it - and there is one absolute certainty - that if it doesn't tell the audience what they want to hear then they will disregard it entirely. They won't take it from trade professionals or academics, they won't take it from remainer politicians and any Brexiter who breaks ranks with the narrative is mistrusted. I've been called a remainer countless times.

A madness has descended on this land. One that is beyond our ability to control. Presenting rational arguments to irrational people is fruitless. This is a fever that ha to run its course. It looks to me like Theresa May is going to play it right to the wire, to spook parliament into backing her deal. It might work. It might not. Parliament is fragmented every which way and she cannot count on the support of ultra remainers or the ERG. If it passes then it scrapes through on a wing and a prayer.

If the deal falls flat then we will descend into political and economic chaos. Within weeks the government will fall, the Tory party will be broken and there is every reason to expect a general election. the results will be inconclusive. Even at this time, Corbyn's Labour is limping in the polls. We are looking at political uncertainty not seen in the UK in living memory.

There is one and only one reason to Back Theresa May's deal and that is that it keeps us in the game. The deal is not the end point and leaving the EU was always going to be an evolutionary process. I have made it quite clear on this blog that the deal is suboptimal in every way - but it is the only deal on the table. For me it accomplishes one thing - and that is to take the first step to leaving the EU.

The argument as to why we should leave the EU was always a slam dunker. The question of how is a far more involved debate and the question of where next is an open question. On that score, leavers simply haven't won the argument. The woolly aspirational guff from the ERG is dangerously out of kilter with reality and the deal is at least an insurance policy against their delusions. It then presents us with a window to turn this around once we are out from underneath the sword of Damocles.

The ambition of the Brexiters is to have a far looser and simpler relationship with the EU. In spirit I sympathise with this view. In reality though, transboundary concerns with our largest neighbour dicate a highly involved relationship and it is never going to be simple because the issues themselves are not simple, highly technical and deeply political. It is therefore unrealistic, nay deluded, to believe that we can sever all formal relations as a permanent settlement to the European question.

Some have remarked that I've gone quiet over the Norway option. Some still hang on to the hope that if May's deal is defeated then there is another opportunity to advance the EEA idea. I have made that case on this very blog. Now though, my feeling is that if this deal is defeated, any deal is defeated. The EEA option cannot withstand the weight of propaganda against it at this late stage. We needed significant parliamentary backing long before now. The option is dead for the foreseeable future.

It is, therefore, decision time. Do I give way to my inherent nihilism in the hope of creative destruction? I think not. Revolutions of this nature are wildly unpredictable and the stakes are too high. Tearing it all down is easy. Building something in its place is not.

My closing thoughts of the year are that the deal on the table, for all of its potential traps, is as good as it gets for the moment. Both sides know that the backstop is politically unsustainable and though the political declaration is said to be non-binding, politically and morally it is, in much the same way as all international conventions are. Whatever happens is not permanent not least because there is no permanence in European relations. It is a long continuum.

Brexit of itself, especially leaving the single market, is enough to be getting on with. It already creates a space for political renewal and creates enough problems of its own. If Brexit is fundamentally about sovereignty then this deal goes a long way toward that goal. The rest we must accept, not only as a recognition that absolute sovereignty is a nebulous concept but also as the price for Brexiter intransigence. They actively resisted having a plan and chose instead to wail from the sidelines. The destination is one of their own making.

And then ultimately, of all the rules, regulations and international conventions I take my guidance from, there are still none more relevant than the Ferengi Rules of Acquisition. The third rule is "Never spend more for an acquisition than you have to". Should we bide our time we can get what we want, but to walk away now is to pay a price we simply cannot afford. Only a lobeless idiot would gamble a £270bn a year trade relationship for the sake of a one off payment of £39bn.

You can argue the toss about the arcane points of principle of the backstop, and whinge about non-regression clauses, but this is the world as we find it. Most people don't care about aviation safety rules or what food safety regime we use just so long as it works. I'm not going to go to the barricades over that and it's not why I got into politics. If, at the end of the day, your trade and economic policy involves mobilising the army and breaking out the civil contingency plans, then it's fair to say it needs a bit of a rethink.

When the tale of Brexit is told it will be a tale of squandered opportunities and wasted time. A better deal was always possible but pragmatism and ambition were crushed under the weight of propaganda from both sides. The remainers ideas were limited by their stunted horizons, unable to see anything beyond Brussels. The Brexiteers made an irrelevance of themselves by refusing to acknowledge reality. It therefore fell to Theresa May to reconcile the irreconcilable to the best of her limited abilities. This she has done. You don't have to like it, because I sure as hell don't, but for now, this is the hand we are dealt.

Leaving without a deal is not just a matter of whether we can keep the trucks rolling. This is about safeguarding dialogue with the EU ensuring that there is a basis for amicable future relations. The ramifications of an embittered and acrimonious breakup are serious. It has has grave and long lasting geo-strategic consequences. We have to be mindful that whatever our view of the EU, it still exists and will continue to exert power in the region and beyond, It is still an entity with which we must contend. 

For all the dire warnings, some verging on the ridiculous, we have to keep in mind that the media is largely unable to cope with the detail of any given story and will trivialise and sensationalise it in order to generate clicks. It is that lack of seriousness that allows Brexiteers to write it all of as "project fear". 

Behind each and every one of those stories, though, is a legitimate concern based on the legal standing of the EU, as set out in the EU Notices to Stakeholders. We cannot know the full extent of the impact but even if much of it is hyperventilation, it's the slow degrading impacts of economic isolation from Europe that will take the greatest toll. Like in war, the humble AK-47 accounts for a higher body count than the A-Bomb.

Every Brexiter, myself included, feels the impulse to tell the EU where to shove their deal. There would be considerable momentary satisfaction in doing so. My feeling, however, is that our own supine and servile political class will be grovelling to Brussels in no time, and without fanfare will sign up to more or less the same terms and conditions. The more volatile our exit, the more pain we endure, the greater the likelihood of total capitulation down the line. For that reason I am backing Theresa May's deal. For all of its flaws, no deal at all is too rich for my blood. 

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