Brexit: a tree in the storm

14/10/2018

As we creep up to the European Council later this week, the Brexit narrative in the legacy media has almost completely internalised, with multiple reports of plots, rebellions and calls to reject Mrs May's "flawed" plan.

The more febrile elements of the media are speculating about an impending government collapse and possible coups against the prime minister, an increasing number of ministers are said to be close to resignation. Then, as the noise level rises, Arlene Foster is reported as believing that crashing out of the EU without a deal is "the most likely outcome".

Whatever the reality, therefore, there is no sense to be had of measured negotiations moving towards a known outcome, where parties are preparing to agree terms. At this stage, though, one might expect some theatricals, but these are usually staged between the negotiating parties. In this instance, the actual negotiations have assumed the character of "noises off" in some distant land, while the main plays are being rehearsed in front of a domestic audience.

In trying to judge how much is genuine, the "outrage" being recorded does not seem contrived and it would be unwise to assert that we're being treated to a vast, orchestrated theatre, designed to show that Mrs May has prevailed against all the odds.

If anything, we might be looking at a situation where Mrs May has lost control of the agenda, with her team in Brussels looking at terms which she will know do not have the slightest chance of being accepted by the dissenters in her own party, precluding any possibility of a deal being accepted by parliament.

This leaves us to conclude the third part of our analysis of the speech given by Sir Ivan Rogers in Cambridge last week, this taking on the mantle of a tree holding out against the raging storm of speculation which is currently driving Brexit.

However, the speech remains just as relevant as ever it was for, whatever the outcome of the current perturbations, there will come a point when the government – with the entire nation – will have to return to the issues raised by Sir Ivan.

As we left his speech yesterday, he was warning that the EU will treat us with the sheer lack of sentimentality in trade negotiations that the US and China, the other trade superpowers, deploy against everyone - and will also deploy against the UK in the next few years.

Trade negotiations with any regional power bloc or major country, he says, are hardball, brutal negotiations. Thus, when one reads recent tracts, like the IEA's recent one covering Britain's trading future and marvels at the sheer naïveté on every page, both about the EU and the US.

As for other world players, we read on China that "the UK should initiate discussions with China but be clear that its requirements for a UK-China deal are likely to be difficult for China to meet in the short term". It goes on that the UK would need "progress in many areas of China's approach to trade". Says Sir Ivan, "Good luck with that. I am sure Beijing is awaiting Dr Fox's Department's advice on how to conclude a path-breaking deal with the British".

On India, we read that among the main obstacles EU-India deal has been the EU's aversion to allowing India Mode 4 services access. We are told that this, "ironically, is due to the UK". But it’s not ironic at all. Because it's of a piece with the views on cross border movement of people espoused by the advocates of Brexit, and delivered into the negotiation by the former Home Secretary, now Prime Minister.

But never mind. We are assured that, when we are sovereign, we shall decide that the numbers of highly skilled workers arriving from India will be “very small indeed”. Sir Ivan (with the rest of us) looks forward to the celebrations when Delhi hears.

As we can see only too well from this weekend's press, nearly 30 months on from the referendum, we are still lost in campaign mode on fantasy island, even though the time for these fantasies is long past. Yet, it gets worse by the day. As tends to happen in revolutions, the core players have become radicalised. They have abandoned ideas of participating in the Single Market, or solutions based on the relationships that Norway and Switzerland have with the EU.

The "radicals" – those whom we define as the "ultras" - increasingly loudly declared these versions of Brexit a betrayal of the manifest “will of the people” – of which, of course, only they are the true interpreters. There is only one pure form of Brexit, and any compromises represented a treasonous betrayal and/ or a humiliation.

It was this "purity" that, via Lancaster House, duly set us on the path we have meandered slowly down over the last two years. And, predictably, the EU has reacted by averring that Mrs May's red lines, if immutable, pointed ineluctably to an economic relationship no deeper than a bog standard free trade area.

At the time, Sir Ivan had to deal first-hand with the extent of the surprise in the European elites that the PM should have taken such a hard line and unequivocal view on the UK's post Brexit destination.

That in itself tells us that those elites thought that Brexit was a long process not a single event, and that a number of end states for the relationship were in play after the referendum.

In other words, that the "hardness" of the Brexit destination and the extent of the unravelling of existing relationships and structures we wanted, depended on post referendum choices and had not been fully determined by the referendum itself.

We then had the remarkable situation where Mrs May herself started to discover what her speech's content actually meant to the other side of the Channel. It seems staggering that, before she delivered it, that she has not gauged precisely what the reaction in Brussels might be but, on this as in many other occasions, she seems to have been talking only to domestic audiences.

This means, of course, that her dream of frictionless trade with our partners, despite having left both Single Market and Customs Union, was just that – a dream, and an impossible one at that.

That perhaps is even more remarkable, where Sir Ivan is revealing that the prime minister of this nation embarked on the most important negotiations this country has conducted since the war on the basis of an "impossible dream" – with no concessions to reality. And she's still dreaming, with key components of her Chequers plan hankering after the "frictionless trade" that she was never going to get.

Therein lies an elephant trap lined with sharpened stakes. The "revolutionaries" were always going to denounce Mrs May for betrayal of the true path Brexit if she committed the UK to staying permanently in a Customs Union, and thus limiting the UK's post Brexit trade policy sovereignty.

And because she had no option but to agree to a legally secure, permanent backstop giving Dublin the guarantee that the UK's departure would not automatically lead to the re-erection of a hard border across the island of Ireland, she had only one place to go politically, if the Brexit revolution was not to eat her as its first victim.

And that was to say that she could agree a legal backstop to solve the Irish border question. But only because no such backstop would ever enter into force. Because there would be an all UK trade deal which would obviate the need for it.

And that, supposedly, would simultaneously guarantee the Brexiteers their goal of a sovereign, autonomous trade policy post exit, by leaving the Customs Union, and being free to depart from the Common External Tariff, but also guarantee manufacturing Britain the friction free trade that comes only when inside a Customs Union, by replicating all its features in the new dual tariff regime.

This is the world of revolutionary politics, in which this kind of total fantasy proposition starts to make sense. You persuade yourselves that, as there is no other way of your squaring impossible circles, it must fly. The slight problem, though, is that it makes no sense at all to Brussels, with whom we have to negotiate.

And that's where we are this weekend. We have the Brexit "revolutionaries" storming the citadels of Westminster, while the denizens of Brussels must be reading today's papers with a growing sense of bemusement, especially when the Sunday Mirror confidently announces that: "Theresa May could clinch Brexit deal by Wednesday".

The rider, though, is what will make sure it will not happen – the price is keeping us in the Customs Union until the end of 2021. In proper revolutionary fashion, says Sir Ivan, this betrayal will be laid at the door of the shadowy conspiratorial counter-revolutionary establishment elite determined to thwart the Revolution’s purpose.

And now, even the advocates of “Norway then Canada” are starting to receive the same “enemies of the people” treatment. The revolution starts to eat its own.

Whether we have reached the point where Mr Gove and acolytes get condemned by the pinstriped Robespierres of the Committee of Public Safety – or is it the European Research Group? – for insufficient revolutionary fervour, and being, like some latter day Danton, in the pay of foreign powers, Sir Ivan does not know.

Danton, of course, famously supposedly said, as he passed Robespierre’s house on the way to his execution: "you will follow us shortly. Your house will be beaten down and sowed with salt". Yet none of us can vouch for what now passes between Brexit supporting leadership candidates.

But, if Mrs May gets past this weekend intact, with a potential deal standing on the table for the European Council to discuss, she will have survived an attempted coup and perhaps the most serious challenge to her leadership to date.

Perhaps it's only fluff, but if it isn't and the "revolutionaries" get their way, then all bets are off – whatever they were. We will see which way the land lies, from how the European Council reacts, and what agenda – if any – it defines for any November meeting. If we see it looking to working on "no deal" contingency measures, then we are in serious trouble.

Bringing us back to earth with a bump, the "revolutionaries" must know that this will have a high probability of bringing down the May government and precipitating a general election with a new leader – with completely unpredictable results.

It could even be that the "Ultras" want a Labour government in place to take blame for the pain of a "no deal" Brexit – then taking the reins of power back at the next election. Who knows what passes through the minds of these people, or what will happen next.

In finishing his speech, Sir Ivan made three brief confident predictions about where we shall be in two years. First, he said, we shall be having precisely the same debate over sovereignty/control versus market access and as frictionless trade as is possible from without as we are now.

The trade negotiations, properly starting quite late in 2019 – a year of transition in Brussels and Strasbourg, and with the need for the 27 to agree amongst themselves a complex, detailed negotiating mandate for a new negotiator – will be getting to multiple real crunch issues. The private sector will still be yearning for clarity on where we are going, and not getting much.

The UK political class will, finally, be starting to understand what trade deals are, how mind-numbingly legally complex and turgid their provisions are, and how negotiations work. And that what they view as the essential pluses to make a Canada style FTA tolerable are precisely the big sticking points. And that all manner of strings, as alluded to by Claus Grube, will come into the deal.

Second, it will be obvious by early autumn 2020 – long before, in reality – that the deal will not be ready by the year end, and that an extension is needed to crack the really tough issues.

The EU, in no particular rush to get this done, as it sits rather comfortably with the UK in its status quo transition, with all the obligations of membership and none of the rights, will use the prospective cliff edge to force concessions, or to offer a thinner deal, more skewed to its interests, in the hope that the UK is desperate enough, pre-election, to get it done.

Third, the Irish backstop, enshrined in the Withdrawal Treaty will still be in place, and no other prospective Agreement being yet in sight which obviates the need for it. And, with that, he closes by venturing an even more cynical fourth.

The Brexit revolutionaries, Sir Ivan predicts, will be saying Brexit has really not turned out as badly as the Project Fear Mongers told you it would. It's fine. And the counter-revolutionaries will be saying it’s only not turned out that badly because nothing at all has actually changed yet, because we are in a long term purgatory transition with the Europeans having taken back control, and what was the point of that?

Whether, in the febrile atmosphere of this weekend, those predictions will even survive this coming week remains to be seen. Anything can happen in the next few days. The only certain thing is that I haven't done justice to Sir Ivan's speech – but then it is available on-line to read in full.

Tragically, we have enough from it on this blog to know that the Brexit negotiations are not in safe hands. This does not look as if it is going to end well.