The US press has taken regularly to running armchair analyses of Trump which comes off as a waste of energy since it’s easy to predict what Trump will do without having a model of his inner wiring.
While what passes for the ruling classes in the UK has been even more predictable than Trump in its behavior with Brexit, engaging in denialism which is truly impressive in its impenetrability, it is much more worth of amateur psychologist attention. Trump has repeatedly had to contend with not getting what he wanted and having the press go after him. His responses are regularly childish, self-destructive, laughable…but he does engage in a response of sorts to unfavorable reactions, whether to issue a full-of-bluster tweet, lambaste a critic, or, say, try a Big Lie in response. By contrast, the Brexiteers act as if they keep repeating their fantasies, the environment will bend to accommodate their desires. Even Trump is more connected with reality than that.
Astonishingly, the Brexit boosters have clung unwaveringly to their belief system despite over a year and a half of EU officials trying to penetrate their fog. The ritual of “EU official says no way do you get a pony” followed almost immediately by “David Davis [or functional equivalent] says EU agrees with us on ponies” or “Of course, EU has no choice but to give us ponies” has become so predictable that numerous commentators have compared it to the movie Groundhog Day.
Perhaps my reading of the news from afar is faulty, but as I indicated earlier this week, following Richard Smith’s sightings, that it is becoming harder and harder for the Tories to keep pesky Brexit realities at bay. The political pressures within the Tory party seem to be rising to the boiling level even if there is no obvious place for all that energy to go. Even though May is hostage to the hard core Brexit wing, they don’t have the votes to force a leadership battle, much the less win one. And a snap election, after the last fiasco, runs the risk of putting Labour in power, a Tory nightmare.
However, again returning to our steam cooker analogy, as you put more and more energy you put into a system, it hits the point where it undergoes a state change, as in goes chaotic. What that means in terms of British politics is way over my pay grade, but the pressures keep building as the Brexiteers keep taking what they see as humiliating failures due to their own unhinged misassessment of what was attainable. They are unable to lash out at, much the less affect, the true object of their ire, the fact that the EU does not care what they think, and has already factored in the losses they will take due to British recklessness and utter refusal to plan and negotiate. So they make Theresa May their substitute punching bag even though beating up on her accomplishes nothing.
For the sake of completeness, the latest developments, only one of which is actually news:
Last week, David Davis gave an unhinged-even-by-Brexit standards speech on the “implementation period” (as if the UK were showing the official capacity to “implement” anything). As Richard North focuses on the critical element, that the UK has been so unwilling to contemplate Brexit in a serious manner, which is then reflected in a refusal to do even the basics of negotiating, like present a set of “asks,” that the EU is dictating terms:
…he presented the EU fait accomplis as “the bridge that we plan to build, to smooth the path to our new relationship with the EU after Brexit”.
What we were calling the “vassal state” scenario long before Rees Mogg appropriated the term becomes a “strictly time limited implementation period, which forms a sound basis for the UK’s future prosperity”.
The fact that, even now, an extension is being talked of, and Mrs May is said to have abandoned her Lancaster House anniversary speech, is neither here nor there. According to Mr Davis, the EU’s idea of transition “allows us to grasp the benefits of Brexit by setting in place the fundamental building blocks for the country as we leave”.
Now mind you, the UK’s bargaining position is so weak it’s not clear how much more it could have gotten if it had tried, particularly since it has set up red lines and completely ignored the fact that they have dictated what sort of arrangement the EU can offer given its agreements with other countries. North also argues the UK has totally ignored that it would have had more latitude as well as leverage were it to pursue trade relations within the EEA framework, since the UK is already a member of the EEA. I think North greatly overestimates the attractiveness of that route, since among other things, a services deal for the City would fall outside the EEA purview. But just about anything would be less bad than the course the UK is charting.
Monday, the EU needed all of two minutes to approve key elements of its transition period, in the form of new directives to its chief negotiator Michel Barnier. Consistent with the speed of the up vote, the decision was no surprise to anyone paying attention. The UK will get only till December 31, 2020 (as we have been predicting). The EU also, again completely predictably, said EU rules would be in force, including any new rule instituted after the Brexit date. UK Brexit boosters howled, acting as if their demand that the UK be able to veto EU rules implemented during the transition period would get any traction. Even the FT’s comment section, which has a decent representation of Brexit stalwarts, hooted down the idea.
Per the Times, the ultras are again ritually threatening May with defenestration as a result of her horrible failures depicted above. Despite all the yowling, there’s no reason to believe that anyone seriously wants to replace her.
A new May sin, per the Times, is a Government leak of an analysis that finds that every possible Brexit leaves the UK worse off. My bet is that the soft Brexit backers planted this story to take some of the wind of the sails out of the ultras, who have been getting more even more rabid. From Buzzfeed, which broke the story:
The government’s new analysis of the impact of Brexit says the UK would be worse off outside the European Union under every scenario modelled, BuzzFeed News can reveal.
The assessment, which is titled “EU Exit Analysis – Cross Whitehall Briefing” and dated January 2018, looked at three of the most plausible Brexit scenarios based on existing EU arrangements.
Under a comprehensive free trade agreement with the EU, UK growth would be 5% lower over the next 15 years compared to current forecasts, according to the analysis.
The “no deal” scenario, which would see the UK revert to World Trade Organization (WTO) rules, would reduce growth by 8% over that period. The softest Brexit option of continued single-market access through membership of the European Economic Area would, in the longer term, still lower growth by 2%.
These calculations do not take into account any short-term hits to the economy from Brexit, such as the cost of adjusting the economy to new customs arrangements.
Needless to say, that “cost of adjusting to new customs arrangements” is going to be a monster hit, particularly given the utter refusal of the Government to even engage the problem, which has been compounded by the wipeout of Carillion, which will in turn lead to the bankruptcy of a significant number of contractors who do things like build port infrastructure. And those of you who do financial modeling know that reducing growth figures early in a time series has a much bigger overall impact than reductions in outer years.
Finally, it is worth pointing out that the EU has repeatedly asked the UK to put forward its negotiating demands. Again, I can’t stress how utterly outside the pale the UK’s behavior has been. From the Associated Press:
Monday’s guidelines include a demand for clarity on what future relations should look like.
“The sooner the Brits are clear about the future, the better for everybody,” said Italy’s EU affairs representative Sandro Gozi. “We have to use our time and energy not in shaping the transition, but in shaping the future relationship.”
Richard North describes how things will play out if this dynamic holds, and there is absolutely no reason to think anything will change:
Nick Gutteridge of The Sun is closest to the mark. “The EU is now just desperate for UK to put forward anything it can actually work with. Last Autumn there was a sense of irritation that we’d been harping on about trade but not come up with anything. In December, that developed into concern. It’s now fast turning into panic”.
In the absence of any serious proposal the EU will end up deciding for us drawing up guidelines for a basic FTA based on our red lines. It will take us at our word that we are leaving the single market, the customs union and ending freedom of movement. Says Gutteridge “Process will begin in less than 4 weeks if May doesn’t produce anything. Feeling is UK’s told us what it doesn’t want, but hasn’t (within bounds of realism) told us what it does”.
That though presents both sides with a number of physical and technical challenges which raises the spectre of an actual implementation period following 2020 geared toward the UK becoming a third country, for which there is presently very little preparation coupled with a profound ignorance of what that actually entails. The lack of preparation could well mean that a basic FTA is only marginally less disruptive than a no deal Brexit.
It is hard to imagine how the UK could have handled what was always going to be a monumental challenge worse. Unless the UK holds a second referendum and winds up backing out of Brexit (which has gone from looking like a non-starter to remotely possible), Tory utter incompetence and opportunism will permanently diminish the UK and deliver a permanent reduction in its citizens’ standard of living. And ordinary people will take the biggest hit.