The Wolfian Blog
Brexit - the Three Choices
Some Brexit Thoughts
The rhetoric about the UK being able to make its own trade deals once it has left the EU confuses me. At the moment we are part of the EU's trade deals. The EU is larger than us, and presumably it wants to get good deals. Why should the UK on its own get a deal that is any better than the EU has? Surely, if it differs, it would more likely be a worse trade deal? Because we are smaller, and because dealing with us is a dead-end, it does not bring access to other countries as part of that deal. No?
And many foreign companies invested in the UK on the basis that it was the gateway to the rest of Europe, had advantages in speaking English, or in London's historical financial strength etc. But if the UK is no longer the gateway to anywhere, what advantages does it have? Ireland speaks English, and could serve as a gateway to the EU instead. France and Germany have powerful financial cities in Paris and Frankfurt that stand ready to benefit from London's loss.
China has invested heavily in the UK. Remember John McDonnell's backfiring Little Red Book stunt? The purpose of that was to mock how Cameron's Conservatives were opening the door to massive Chinese investment, ideology be damned. But China made this investment, and commitment to future investment, in a large part due to the UK's position as the gateway to Europe, which it is now giving up.
It is of course possible for the UK not to give up this position - but only by staying in the Single Market (and Customs Union, but as Dan Hannan said in 2016 "nobody is talking about leaving the Customs Union" because that would be insane!). The Tories want to leave the Single Market and the Customs Union. So, the only way to remain as the gateway to the EU whilst being outside of the EU is being tossed aside. The Tories don't want that. But they expect to retain this position of being a gateway because... fantasy.
It is clear the Tories believe in brinksmanship - they assume that the EU will decide at the last minute they cannot let the UK end up in a seriously bad position. But this is to ignore reality. The EU is already activating its contingency plans - EU organs based inside the UK are being demised and relocated to other countries. Paris and Frankfurt are welcoming operations of banks and financial institutions from London who are not abandoning London, but sending certain of their critical operations outside of the UK. This has already happened, or is happening now, it's not something that is being planned for, or discussed. It is contingency plans already being acted upon.
It also ignores the EU's political position - that it does not want any other country to leave the EU, so cannot afford to make the process unnecessarily easy, or advantageous. The EU has no interest, coldly speaking, in helping the UK. If being outside the EU still allows the UK to access EU markets without accepting the rules it would lay down a precedent that other recalcitrant countries, such as proto-fascist Hungary, might decide to take.
Theresa May and the Tories have a HOPE and a WISH, they do not have a plan. That is why now, 600 days after the EU Referendum, they are meeting in emergency cabinet sessions to discuss what they want. The realists in the cabinet understand all of the above points, and are trying to ameliorate the damage by pointing out reality. They are met by the fantasists, who assume they can have never-ending cake both to have and to eat, and the extremists who don't care what happens because only abstracts matter to them.
This latter is the UKIP Faragist view - sovereignty, take back control, all of those slogans. But it only works if you are rich. Of course, Boris Johnson, Jacob Rees-Mogg and Michael Gove ARE rich and they can easily survive an economic collapse in the name of sovereignty. But their presence in the cabinet and the strength of their voices due to the hard-right newspaper owners who back them, mean that the realists' arguments are constantly over-ridden by objections based not in the real world, but in that of propaganda.
So, everything comes down to 3 simple choices:-
1. Stay in the Single Market and Customs Union and retain the position of being the gateway to the EU to keep business investment in the UK
2. Hope that the EU will back down and decide that the UK can have the benefit of staying in the Single Market and the Customs Union without actually doing so, thus allowing the UK to retain the advantages of being a gateway
3. Fuck it all, in the name of sovereignty and taking back control, because slogans matter more than the economy and white nationalism trumps jobs.
The Tories are clearly hoping for option 2. but there are currently no signs of it happening. Their fallback position is not reality (option 1) but insanity (option 3) .