UK Trying to Renegotiate Shape of the Brexit Table, Which Will Effectively Shut Down Talks

I’m behind on Brexit coverage, but an issue that the press has noticed is even more important than it seems, so I’m highlighting it.

UK readers may recall on the very first official Brexit talks session, the UK’s chief negotiator David Davis did not comport himself very well. More important, the British side effectively capitulated on virtually all points regarding the sequencing of issues. That isn’t surprising, since we and others had pointed out that the already impossibly tight timetable, made worse by Theresa May losing time with her snap election stunt, in combination with the fact that a disorderly Brexit would be catastrophic for the UK but merely painful for the EU gave the EU tremendous negotiating leverage. Moreover, the EU had been clear and consistent on its main issues, such as “The exit tab is one of the very first issues we need to settle” and “No trade talks until we’ve sorted out exit details.” The EU was actually generous by their standards by relenting a tad on the latter point by now being willing to discuss future trade arrangement when the major departure issues have been largely resolved.

As we wrote in early July:

For instance, the UK had harrumphed that no how, no way was it going to pay an exit bill, and/or certainly wasn’t going to entertain that discussion unless the EU negotiated a trade deal at the same time. The EU had said from the outset that it wasn’t going to talk about trade until the Article 50 matters had been settled, and then relented a tad and said it would be willing to discuss the general outlines of new trade arrangement, but only after all the exit stuff had been pretty much settled.

The UK capitulated to the EU position on the first day of talks. The only “shape of the table” issue the UK appeared to have won was one week of negotiations per four week period. But that does not really work to the UK’s advantage. With such an insanely compressed timetable for resolving so many matters, the UK would be better served to spend more time negotiating with large support team(s) deployed to investigating and resolving technical details. But the UK is so short staffed that it appears to be unable to do much if anything in parallel.

The UK now appears to be trying to undermine the order of battle that was previously agreed. This is a disaster on multiple levels.

First, it means the two sides will engage in arm-wrestling over what gets negotiated first. The term of art,s “negotiating the shape of the table,” is a precursor to discussing substance. More fighting over that means even less time to resolve an already overwhelming list of very complex and contentious issues.

Second, it reeks of bad faith negotiating. The British already are virtually friendless on the Continent thanks to treating EU institutions with open contempt for decades and conveying the attitude that the English are racially superior to Europeans. Building an atmosphere of trust between negotiators as individuals, even if their principals are far apart, is critical for negotiations to succeed, and even more so if both sides need to be flexible and creative. At a minimum, that’s been acknowledged to be required for sorting out the Irish border issue, which in and of itself could be a dealbreaker. The more the UK tries throwing its toys out of the pram to get its way, the less likely the odds that these already difficult talks will succeed.

As we’ve pointed out repeatedly, we’ve seen troubling parallels to the failed Greece-Troika negotiations of 2015, which resulted in a devastating defeat for Greece. As the UK is doing now, Greece badly overestimated its negotiating leverage and made a bad situation worse in engaging in bad faith negotiating tactics. The most important was repeatedly reopening supposedly settled deal points. The only way you do that and get away with it is by avoiding it if at all possible, and if you must, groveling and offering a concession. As we’ll see soon, the UK side is doing nothing remotely like that.

Third, the EU will effectively walk from the negotiations by putting a brake on them. The Europeans are far too skilled at this game to not see through what the UK is trying to do and putting the kibosh on it.

Reuters gave an early warning that the UK was trying to stymie the EU requirement that the settling the divorce bill was one of the first two issues that had to be resolved (the other is the movement of people).From an August 15 article, Britain says there will be no Brexit bill figure by October:

Britain will not have agreed a figure with the European Union for its so called Brexit divorce bill by October, Brexit Secretary David Davis said on Tuesday.

The EU wants agreement on how the exit bill – to be paid in euros – will be calculated before talks can move on to Britain’s future relationship with the bloc.

“We’re going to talk it through very, very carefully, so at this stage we’re not going to commit, there won’t be a number by October or November, whenever it is,” Davis told BBC radio.

This may sound innocuous but it isn’t. The EU expects this issue to be addressed in specific detail in the talks this month. While it may not be resolved, the idea that the UK effectively plans to foot drag was a big red flag.

Politico today confirms that EU negotiators see the UK as making concerted efforts to change the order of negotiations by putting out documents on their pet issues and neglecting the ones that the EU insists have to be addressed first. From the story Brexit talks will stall:

Britain must come forward with a proposal for how to calculate its EU exit bill or next week’s Brexit talks will come to a grinding halt….

At next week’s round of talks, according to the three senior officials spoken to by POLITICO, Brussels expects U.K. Brexit Secretary David Davis to provide precise details on which obligations in the EU budget it is willing to pay for — in short, a methodology for calculating the bill. Although Davis has acknowledged that Britain has financial obligations to the EU, which need to be resolved as part of the withdrawal process, a methodology is something the U.K. has thus far pointedly refused to provide.

EU negotiators will also demand more detail on how the U.K. intends to permanently guarantee rights for EU citizens living in Britain (and vice versa) and specifications about Ireland’s border.

The EU’s chief Brexit negotiator Michel Barnier underlined Monday that talks on trade and other aspects of the U.K.’s future relationship with the bloc can only move forward once sufficient progress has been made on the separation issues.

The article gives more detail as to how the UK has been trying to change the order of negotiations:

In the two weeks running up to the talks, the U.K. government has been bombarding its EU counterparts with a series of position papers on everything from future customs arrangements to the handling of confidential documents.

But the majority of the proposals refer to the U.K.’s future relationship with the bloc, rather than the separation issues that the EU wants to tackle first. It regards the flurry of documents from the U.K. as a distraction tactic, designed to pressure its negotiators into talking about future trade.

“We feel they have come up with these papers to distract attention away from issues around the financial settlement,” one of the diplomats said, suggesting that the documents served more as a smokescreen rather than an actual negotiating tool for this round of talks.

And even this characterization is charitable. This article later echoes the observation made by other commentators: that the UK papers are a joke compared to the ones the EU published very early in the Article 50 process. Theirs run to hundreds of pages each, reflecting considerable thought and effort, while the UK documents are mere handwaves, typically in the 10 to 20 page range. And some of them are pathetic. We hope to get around to shellacking the one they released on border issues, where they sketched out two incompatible options. How do you negotiate with someone who won’t even commit to an opening position?

As bad as Brexit has looked from the outset, the Government seems determined to make a complete hash of the process. I shudder to think what they’ll dream up next.

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