Winner of the New Statesman SPERI Prize in Political Economy 2016

Tuesday, 11 September 2018

Are the EU wrong to make things easy for May?


Most experts who follow the Brexit negotiations think the Withdrawal Agreement (WA) will sketch in pretty loose terms what the final relationship between the UK and EU will be, although some EU politicians have indicated a reluctance to do this..A vague WA has been called a ‘Blind Brexit’ (ht Chris Grey). While a blind Brexit might help in May’s efforts to achieve an agreement and (maybe) to get parliamentary approval for it, it remains a very undemocratic way forward [1]. Here is why.

Suppose there are only two types of Brexit possible: a No “not the end of the world” Deal or BINO (staying in the single market and customs union). All the polls suggest No Deal is not the will of the people, and its support is in any case dependent on a false view of its economic consequences. Equally it is difficult to understand why anyone would support BINO compared to EU membership, as the only major difference is that we no longer get a say on how the rules we have to obey are changed.

A result of keeping the WA vague about the final relationship is that this binary choice is not apparent to many voters. In particular the UK government is still peddling various halfway houses that the EU is very unlikely to agree to, but we will not know for sure that they will be rejected until after the WA. If we did know it before the WA the number of people who had changed their mind would be greater than it is now, which in turn might embolden parliament to call the whole thing off.

Thus we will leave under false pretenses, of exactly the kind that led to the narrow vote to Leave in the first place. When it does become clear that there are only these two choices, it will be too late to change our mind without new costs. Re-entry into the EU might require becoming part of the Eurozone for example. So we will could end up with BINO plus face saving details forever, and pretty well everyone (including No Deal advocates) will agree we are worse off than we were before.

A similar problem happens if parliament does not approve the WA and we end up with a second referendum. The logic of a second referendum is clear. In the first in 2016 the promises made about what leaving would mean were various and many were untrue. Now we know what leaving does involve it makes sense to ask the people once again. Except in any referendum held after the WA fails to be approved, we will not know what the final deal will be, and that will give May the chance to spin her deal in any way that gets votes. Rather than a referendum on a final deal, it will in fact be a second referendum with unicorns only slightly less outlandish than in the first referendum.

This is what I mean by a very undemocratic procedure. The fault lies first with David Cameron, who should never have agreed to a referendum where the type of Brexit was unspecified. It then lies with May, who initially prefered Brexit fantasy to reality and despite Chequers still panders to the Brexiters. Above all it is the fault of the Brexiters, who by going back on an agreement made in December wasted precious time so they had more chance of getting No Deal.

The EU cannot really be blamed for going along with a vague WA. They are quite happy with BINO, and it avoids a No Deal accident. For that reason they may feel it makes sense to help May. The alternative of insisting on a detailed WA on future trade is high stakes: it could end Brexit, but could lead to No Deal. It is not surprising that most EU politicians would take the less risky option.

It remains the case, nevertheless, that by allowing May to have a vague WA on trade they are assisting in the deception of UK voters and MPs, who will be leaving the EU without knowing what is going to take its place. I hope that is something the EU recognises if we do leave in March 2019 and subsequently want to return. I suspect, however, that this is a vain hope.

[1] It is also costly in economic terms, because it prolongs uncertainty about what future trade relationships will be. Some of the issues I describe here may also divide those who voted Remain over whether the WA should be passed in parliament or not. 

8 comments:

  1. Of course, it is possible that the EU is fed up of the UK's shenannigans and would be happy to see the back of the UK, especially if it means not having an economic car crash.

    The irony, of course, would be, then, that they would have provided some (to a limited extent, of course) validity to the Brexiters claim that the EU is not democratic.

    At the same time, there is a question of what is actually being said and what is being reported. As far as I can tell, despite the odd warm words, the EU position has not really changed (although throwing in some carrots along with the sticks).

    Finally, and I think the EU (and the Irish in particular) are well aware that 'The Troubles' have not been absent from public consciousness long enough for the possibility of their resumption to be ruled out. In such a case, if the EU's actions are deemed to have at the very least, abetted such a resurgence, should that arise, would greatly tarnish the EU.

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  2. Your final paragraph suggests you think - or at least feel - that the EU has some sort of intrinsic obligation to the people of the UK. But it doesn't - it has an intrinsic obligation to the citizens of the EU, it has no intrinsic interest in the wellbeing of UK citizens, or at least none that is not subordinate to interest in the wellbeing of EU citizens. You voted to leave, so the EU has to deal with that fact as well as it can. Given the behaviour of the UK executive, and, in particular, egregious bad faith behaviour (also of people with influence on the UK executive) it is surely right to concentrate its efforts on whatever arrangement will reduce the risk to it of a no-deal, rather than increase the possibility of a 'good deal'. If that leaves the UK in a less than ideal position, then so be it (the EU interest in avoiding a no-deal more or less at any cost, is anyway surely in the interests of UK citizens).

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  3. Kicking a can down the road with a WA is par for the course for the EU. Once one steps back from the spitting match it's quite easy to see the Europeans need it as much as May. For instance all the primary distribution centres for the Irish supermarkets are in the U.K. They can't throw Ireland under the bus and so can't risk bringing May down. The common ground for both sides is to spin BINO to give May something to hold the Tory vote together at the next election, and keep German exporters and city financiers happy. All this is not only a real possibility, it's probably the only possibility. That's why the WA (chequers) is live project, whatever the posturing around it, and why labour is dead right to sit on the fence till the spoke clears.

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  4. The logic of a second referendum is clear

    That might be so, but I'm less sure about the logic of second referendum campaigners, few of whom have (in my perhaps limited experience) troubled to explain, perhaps even to themselves

    (a) what the question is going to be on any second referendum ballot paper (given that it is not in their gift) ;

    (b) how they propose to bring this about in the very short time they have available.

    Quite a large amount of energy has been expended on demanding that the Labour Party come out for a second vote - a perfectly proper thing to do if you are a member or supporter of that party, but not actually a substitute for realising that time is short, the Labour Party is the Opposition and not the Government, and that if people want this to happen then they need to be turning their focus and their fire on the Government, doing it soon, and doing it effectively. But this does not seem to be a priority.

    Personally I am ambivalent about a second vote (it might get me, as a UK citizen in Europe, out of a hole, but I'm not at all comfortable about people demanding a fresh one when the first one doesn't go their way) and I think Labour is right to remain sceptical on the subject, but as I say, it's not really about Labour because Labour aren't in government. I really would like People's Voters to explain, loud and clear, what precisely they would like (a three-way out/in/Chequers vote? out/in? what?) and, as clearly as possible, how they expect this to come about in the time available. I'd also like them to be asked this more than they presently are. And until then I'm going to feel that the major effect of the campaign is fashioning a stick, often deliverately, to beat the Labour Party with, when it should be one to raise against the Tories.

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  5. "Re-entry into the EU might require becoming part of the Eurozone ..." If the UK were to rejoin the EU it would only have to agree to a commitment to adopt the Euro in due course by fulfilling the convergence criterion, part of which is joining the Exchange Rate Mechanism (ERM II), which is voluntary. Sweden has not volunteered to join ERM II so cannot be forced to join the Euro.

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  6. Agree with the undemocratic nature of a blind Brexit. Agree that the EU may allow this to avoid crash-out Brexit, and it might also strengthen their hand in follow up negotiations. However, I do not think it is correct to describe Chequers as BINO; it still maintains May's silly red lines. There's no chance the EU will agree to May's unworkable cake and eat it solutions to remain close to EU (common rulebook), but equally I can't see May suddenly agreeing to SM or CU. It's not clear there will be an option of BINO at all. It'll be Blind Brexit (Blexit?), no-deal or remain.

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  7. Spot on! I think the EU was wrong to let the fudge go in the first phase, and accept a Irish "solution" that was anything but, just to keep May in her post. I think they shouldn't help May, and if a True Brexiter takes over, all the better. Their incompetence and sheer ignorance will be clear for all to see, and we will be rid of them for decades!

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  8. I think we all want to see article 50 pushed back from March 2019.

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