Sunday, 18 June 2017

The State That We Are In

The moment we've all been dreading has finally arrived.  That's right, we're sending David Davis and his cohorts to begin negotiating the end of his political career and our livelihoods.  On this momentous occasion in the history of international relations I think a quick summary of the situation might be in order.  Let's face it, we're in a right old state.


As I write this pitiful précis the UK has no formal government and no hint of a plan.  To make matters worse a spate of resignations has left its negotiating team in disarray.  Despite all that our dear leaders plan to carry on as though they know what they are doing, even when they clearly don't.

The Prime Minister held a General Election solely to build democratic consensus for the hardest possible Brexit. She failed to get that consensus but decided to carry on as though nothing had changed.  The only tangible conclusion we can draw from GE2017 is that the specific flavour of Brexit proposed by Theresa May is not supported by the public.  It is not clear which flavour, if any, would find majority support but we know for definite that hard Brexit is not one of them.  The rational response would be to present a fresh set of options to parliament in order to buy in consent now that will be sorely needed later. There is nothing rational about the way Brexit has been managed so far.

Economic indicators since GE2017 have made clear that markets are much happier now they have reason to believe that hard Brexit is dead.  The problem is that Theresa May's coalition will  fall apart on any other path except for hard Brexit. The bizarre logic that arises from clinging on to power is that May will carry on the same path she was on prior to the election, despite the electorate having firmly rejected her flimsy plans. Hard Brexit might be theoretically dead because there is no democratic consensus for it but it isn't yet over in the eyes of May or anyone in her shaky cabal.  She fully intends to negotiate a position that will struggle to gain parliamentary support in the mistaken belief that she will not require that support.  The problem for May is that Brexit not only requires parliamentary support but also market and business support. A run on the pound followed by money taking flight to the safety of the Swiss Franc and the Euro would be enough to bring almost any government to a swift conclusion.

Special Brexit remix of "What's Your Flava?" by Bo Selecta hitmaker David Davis.

The UK has published nothing to formally indicate its red lines or its goals.  In fact, the UK has so far failed to participate in the formal exchange of briefing papers with the EU.  Given the disarray at the heart of UK non-government it would be surprising if they were anywhere near that level of preparedness. As it stands the UK will be limited to saying "yes" or "no"  to proposals put forward by the EU. I think everyone knows that is not the route to a successful outcome.  It's worse than  that, though, because Theresa May's pre-election red lines and her coalition deal with the DUP mean that  the UK can only say "no, nein, non".  The UK has literally nothing to negotiate because it failed to build consensus around an achievable target underpinned by a set of unambiguous principles. If you keep your cards too close to your chest sometimes you forget what's written on them.

The DUP will withdraw their coalition support for anything but the hardest Brexit. It will be impossible for David Davis to agree to almost any proposal put forward by the EU because it will violate the conditions of the DUP coalition and lead to the end of the government.  The conundrum is that the "negotiated" settlement that keeps the DUP on board will not ultimately find support from pro-EU Tory backbenchers.  Tory dissent would be manageable if they had a large majority but right now they don't have any majority.  Worse still, the Prime Minister looks weak and has lost the confidence of her own flock.  There appears to be no achievable outcome that isn't utter disarray.

The UK is woefully unprepared for what happens after it leaves the EU.  For example, the legislative void that awaits the UK is to be averted by the Great Repeal Bill, an enormous legal undertaking that will attempt to rewrite all UK legislation without reference to any European court, treaty or technical agency.  Unless this can completely clear the House of Lords and the House of Commons in time the UK will cease to function as a developed nation. To be honest, there is no chance at all that this will be ready in time and it doesn't look as though there has been much effort to achieve the deadline.  The UK's trading relationship is also in jeopardy.  On 31st March, 2019 all trading relationships enjoyed by the UK will cease. There will be a sudden introduction of tariffs and quotas on almost everything leaving and entering the country. Where are the customs officers, the electronic tagging systems, the infrastructure required to raise taxes or separate goods at their final destination from goods in transit? Actually, forget all that for a moment because the shock to the economy will be so painful it is hard to see how Sterling can remain stable. Foreign exchange dealers have already sent a shot across the bows but what will they do when confidence in the UK's ability to sell any good or service to anyone anywhere is completely undermined?

The UK's looming legislative void is further complicated by the need to sign more than 750 legal agreements with 168 nations just to tread water.   The reason behind this is that every single agreement that the EU had with a third party will be void for the UK after it leaves the EU.  One example might be the continuing presence of  UK nationals in sunny Switzerland.  What rights can I expect in a new treaty agreement?  Will there even be a new treaty agreement on continuing rights of UK/Swiss citizens?  This ought to be a top priority for Boris Johnson but he hasn't even once acknowledged the problem at hand.  To be honest, I'm not overly confident that the Foreign Office will get to grips with this in time.  Besides, we all know that Boris Johnson is the top priority for Boris Johnson.

The UK has already capitulated on the order of the talks.  The EU has maintained that trade talks can only start after the divorce talks have concluded.  The UK, of course, signed up to all of that when it agreed to the adoption of Article 50 and the legally binding processes that would be followed by any nation exiting the EU.  Nevertheless, as recently as a few weeks ago David Davis was still saying that the order of the talks would be the "row of the summer". Instead of picking winnable battles he opted to relentlessly batter away at a hopeless cause.  This makes him look stupid and weak but worse than that it makes him look as though he is entering the talks in bad faith.  Instead of building trust and consensus he has opted to send slogans straight to the front page of the Daily Express. And now he has lost.  What's next?  It might be the role of the ECJ, it might be the definition of permanent residence, it might be conditions of a transition phase.  It doesn't matter because every time he says "no" he takes the UK closer to the brink, while every time he says "yes" he takes the UK closer to the brink. Chess players call this Zugzwang.

The EU has published its negotiating guidelines in pain-staking detail.  It put together a working group, iterated on proposals, and sought democratic consensus from the Council of Ministers and the European Parliament.  The EU has also appointed an experienced negotiating team and granted them the legal powers set out in the guidelines.  Are we hearing about disarray, disunity and resignations from the EU side?  No.  Are they clear about what they are trying to achieve?  Yes. Given the agreed legal limits of the negotiating team is there likely to be EU consensus on the outcome?  Yes.  It all looks so easy when political dogma is removed from the equation.

The EU will regularly publish the progress of the negotiations.  If David Davis was hoping that a cloak of secrecy would cover the hopelessness of his situation then he got it wrong.  We will be treated to a real-time glimpse of what it looks like to knowingly take one of the richest countries in the world to the brink of economic and democratic collapse.

This can all be avoided by voting Yes in a second independence referendum,

Terry

PS I honestly can't see any positive outcome for Brexit.  Literally every path ends up in parliamentary deadlock but that won't do because the clock is ticking down to legislative chaos.  It doesn't matter if May is deposed or the coalition falls apart or Corbyn attempts his own coalition or an election is called and Corbyn wins it or an election is called and a different coalition takes power.  None of that matters because the fundamental problem remains the same:  it is impossible to deliver an outcome without first describing it and building consensus around that description.  Unless somebody can do that Brexit will either be cancelled just before the brink or it will go to the brink.   I don't mean to be too apocalyptic but this is a genuine challenge for the UK democratic process.

PPS David Davis has confirmed he will turn up in Brussels for talks but I'm not sure there is much point to that because he has no authority to negotiate anything and everyone knows that.  I publish my articles on a timer so anything might have happened in-between pressing the button to publish and actual publication.

PPPS Nothing serious is going to happen until the German election is over and the UK have something resembling a stable government. That's why tomorrow's talks are mainly lunch, a mysterious meeting called "working groups" and a press conference.

16 comments:

  1. "The DUP will withdraw their coalition support for anything but the hardest Brexit."

    What's your basis for that? They seem to be pushing for a softer Brexit - at least for Northern Ireland. I don't think they've thought through the implications of NI remaining in the customs union - it'd require GB-NI customs checks! But they seem to be overtly opposed to a hardening of their border with the Republic of Ireland.

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    1. It was a difficult and horrible job but I've actually read their manifesto (http://dev.mydup.com/images/uploads/publications/DUP_Wminster_Manifesto_2017_v5.pdf). Click on that link at your own peril! I'd say that The DUP are even more fantatical about Brexit than UKIP. The DUP support leaving the single market, ending the 4 freedoms, leaving the customs union and removing the UK from the jurisdiction of the ECJ. Brexit doesn't get any more extreme than that. Exactly like UKIP, however, they think they can get everything they want yet retain all the advantages of EU membership. As you point out, they can't have this but I don't think they realise the conundrum yet. I don't recommend turning to the DUP for technical guidance on EU procedure, though David Davis might be doing that right now.

      Some might argue that the hardest possible Brexit is "no deal". The DUP certainly stop that happening because the border can only remain open if an agreement is negotiated. Walking away is no longer an option. My view, however, is that "no deal" is only technically different from the current course of the Government. We still leave every EU initiative - the hardest Brexit possible. The tax-free limits given to individuals crossing the NI border are tiny technical details in a huge sea of unplanned change.


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    2. Yeah...

      https://www.theguardian.com/politics/2017/jun/21/how-does-the-irish-border-affect-the-brexit-talks

      "On the first day of talks in Brussels, a senior EU source said the Irish and British had been told that while there would be no need for “barbed wire and gun posts”, there would need to be checks.

      “If you leave the single market, there must be checks,” the source said. “It might mean lorries turning off into a layby after going through the border but there will be checks.”

      The former European commission customs lawyer, Michael Dux, drew gasps from MPs on the Northern Ireland select committee in February, as he told how every vehicle carrying goods worth more than €300 (£264) crossing from Ireland into Northern Ireland would, under EU law, be liable for checks."

      ...

      "The DUP, which is on the verge of being a powerbroker in Westminster, has warned that it does not want special status for Northern Ireland that would allow it to somehow remain in the EU."

      There's a bit about possible solutions later in the article. But they don't look very promising. So now I think the DUP intend to extort from the British government enough cash to mitigate the costs of Brexit.

      But, wow. That means they're going to force the British government to get a deal of some sort with the EU - which means paying pretty much all of the "exit bill".

      Has May actually managed to trap herself into the "a deal worse than no deal" situation she warned against?

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    3. Great link. Gasps of horror, indeed.

      The NI border has turned into this mythical place where deals can be struck to make the border vanish yet also reappear to delineate economic zones. We're very much back to cake and eat it. I don't understand why UK politicians haven't taken the time to visit the EU border to see what it looks like. This is not hard to work out.

      I've seen all sorts of solutions that include making NI a special zone and moving the border to Belfast. That makes NI less like the rest of the UK and more like part of a united Ireland so I can't see that taking root with the DUP. Nothing works.

      The rumours coming out seem to match your analysis - the DUP are trying to extract bribes for NI that will offset the losses of the reinstalled border. To be honest, NI could probably do with a bit of TLC so maybe it is a good thing that it becomes a higher priority spending target. Having said that, it's not clear that there is enough competence in the political leadership in NI to spend it wisely.

      It's sort of incredible how the language of Brexit is now entirely about limiting losses. Almost nobody is yelling how great it will be. When will we start to realise that other paths are available? It's almost as though Brexit is a social taboo like seatbelts in cars or smoking in offices and we need to learn to slowly break it. Time is running out.

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  2. Morning Terry. Still looking at all this from my post op recovery situation, and although I'm on less drugs the view looks just as surreal. It feels like I'm watching an improbable TV disaster drama scripted by a bunch of nut-jobs

    Michael Gove on R4 this morning going on about how wonderful it all is and how he is the saviour of the environment and the fishing industry...... Can he be real?

    I would find it all darkly funny if it wasn't so f*****g catastrophic. Thing is, lots of people in Scotland just don't want to believe this, and the unionists have their fingers firmly in their ears.

    NS needs to return to a firm leadership position with a bit of steel in it pronto. We need that referendum in 2019 at latest, and we need to be strong and restating the case from now.

    The U.K. Is cutting its own throat, and I don't want to be there.

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    1. You're not hallucinating or dreaming, this is really happening!

      It's all a game to the likes of Gove and Johnson. They might be top of the their field at the cut and thrust of political jostling but leaving the EU requires leaders who can build trust, reach consensus, understand a complex matrix of trade-offs, get to grips with endless detail. One year on and I don't get a sense any of them have got to grips with their brief. David Davis has some moments approaching self-awareness but he always follows that up with a fresh slogan.

      You're right about NS. I want to see her be much firmer about the choices facing Scotland. The truth is that Scotland voted to remain in two unions but can only remain in one. I do understand that everyone is tired of referendums and elections but we are not in a period of political stability. SNP won 60% of Scottish seats - it was a historic victory - and I'd like to see NS be much bolder.

      The timing of a 2nd Scottish referendum is a very tricky decision. We don't know how long the UK Government will last or if there will be an election soon, we don't know how public opinion will shift, we don't know if the UK will remain in the EU in a transitional phase. These all affect the timing of the referendum. Later is always better than sooner due to the demography of independence support. At the same time, politics moves so fast right now that planning is probably a bit pointless. Difficult call.

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    2. btw hope you're on the mend.

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  3. Glad to hear that EN. We wish you a very speedy recovery

    It's really hard to believe that the UK, one of the 5 permanent members of the UN Security Council, and a world player, albeit a declining one, for centuries, is in this mess.

    Jon Snow, talking to the leader of RBoKC council about the Grenfell fire, said that it was something that might have been expected to happen in some third world country, but not in London.

    I'm inclined to think that the same might be said of the Brexit negotiations.

    An unsophisticated country, unused to dealing with wide ranging international negotiations could go into discussions ill-prepared. Even a small first world country with few experts might struggle to get themselves prepared to meet the negotiators of the EU.

    But Britain?

    We are fortunate that an even bigger mess is being played out in the considerably more important Washington DC (where even the lawyers are getting themselves lawyers) at the moment and that much of the world is concentrating on the ineptitude of Trump rather than that of third rung May.

    You tell a scary tale there, Terry. I'm rather afraid that this is what you get if you allow tabloid newspapers to tell only one very biased side of the story, and no one gets the actual facts across. And then you leave the decision to seriously ill-informed people.

    Since I read your article earlier this evening, I have read that Arlene Foster asked for £2 billion for her support. At present May has not agreed to that. So we still don't have a government.

    I also read that it seems possible that May may have to obtain agreement from the Scottish parliament to take Brexit forward.

    I'm not sure of the veracity of either of the two above. Twitter sometimes spreads lies as well as facts.

    Interesting nonetheless.



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    1. There was a excoriating article in the Tagesanzeiger about the UK being the laughing stock of Europe. It really didn't pull its punches. Britain is suffering reputational damage that will take a long time to repair. It's true that Trump generates a lot of headlines because he is something of a cartoon figure. The UK Government, however, turning up without briefing papers, despite having a year to prepare, and then capitulating on the "row of the summer" hasn't gone unnoticed. They are a shambles and everyone knows it and everyone knows it is self-inflicted and could have been avoided.

      I also read about the £2 billion demand and the idea that Scotland will get to vote on the Great Repeal Bill. It's hard to know if the former is true. The latter is odd because there is no legal requirement that Brexit requires Scottish consent. The "self-denying ordinance" of devolution is already tested in court but more importantly there is nothing directly in the policy decision to exit the EU that is devolved. That suggests May has some plan up her sleeve because she is playing politics here rather than following procedure. No idea what she is up to. A simple explanation is that this is just more muddled thinking from a muddled government in a right old muddle. They've been in a muddle for 11 months now and it just gets bigger and bigger. It is definitely an interesting development but I'm mainly wondering when they'll realise they've made another category error.


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    2. Key phrases: out of touch, laughing stock, don't know what they want, what is going in this country, irresponsible, obsessive hatred, lies, betrayal, uninterested in truth, tasteless propaganda, waste of time, puzzle, ideological idiots.

      http://www.tagesanzeiger.ch/ausland/standard/lachnummer-europas/story/29320034

      Key words: wobbly, debacle, fickle, erratic, crisis, queen of denial, nightmare

      https://www.nzz.ch/international/britische-labourpartei-ein-erstaunliches-comeback-ld.1299989

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  4. Unfortunately there is no way Scotland can stop Brexit. The Scottish Parliament will vote on a legislative consent motion regarding areas which are currently devolved within the EU context and which Westminster wants to change as a result of Brexit.

    The Supreme Court ruled that the Sewel convention, which says the Westminster parliament should not legislate on matters devolved to Scotland without the Scottish parliament’s approval, is not legally binding. They'll therefore just ignore us as usual.

    As we all know the only way out of this mess is to vote for independence.

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    1. Correctamundo, there is only way out of this mess.

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  5. Terry,

    Few days on since you published.

    Looking better or looking worse?

    From my point of view, Theresa May moves from one disaster to the next with an alacrity that knows no bounds. Whilst I realise that power is, for some, it's own prophylactic, I'd have thought that chugging it down your throat like some cheap fortified wine, to the extent that selling your soul (does she have one?) to the DUP might be a tad like seeing elves in the rafters. Perhaps some loved one would drag you along to the nearest psychiatric clinic?

    OK, perhaps a tad over the top, but there seems to be no game in town apart from 'Brexit means Brexit' anywhere outwith Scotland. There seems to be no-one they will turn to about sensible advice.

    This is perhaps the weirdest political era I have ever lived through.

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    1. Sorry for my lack of posts lately. It has been so hot here that I've only just had the energy to lay on the sofa with a damp cloth on my head.

      Next post is due tomorrow morning. Can life get more exciting?

      It looks like Theresa May is stable for the time being and that Labour have allowed her to continue on her pre-election Brexit course.

      Crazy times indeed. There is barely a positive word said about Brexit yet it carries on with its own bizarre logic. The DUP move is beyond words. The UK is now the laughing stock of Europe.

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