Tories, Trapped by Their Red Lines, Again Blame EU as Clock Runs Down

What they Tories have wanted to regard as the light at the end of the tunnel is instead a train bearing down on them.

One of the reasons for a Brexit post today is that Theresa May is due to give a speech to Parliament today on the Brexit in light of the upcoming March round of negotiations. The EU, in what looks like an effort to force the Government out of its Groundhog stasis, released its draft of a treaty Wednesday. Some observers thought the publication might have been moved up, since some annexes that one would have expected to have been fleshed out a bit were blank.

Even though the EU’s chief negotiator, Michel Barnier, denied trying to administer shock therapy to the UK, any bit of reality intruding into the Government’s and press barons’ fiercely maintained bubble would amount to that. And as much as the UK officialdom is in an uproar about some of the proposed terms, most of all over Ireland, the consternation is pathetic, a combination of ignorance and bad faith.

From the very outset of Brexit, the only serious documents that have been presented have come from the EU. The best the Government has offered is loftily phrased handwaves. The fact that a major rounds of negotiations is fast approaching is no secret. The UK was tasked in the December Joint Agreement to codify its proposal for Ireland. It has yet to do so. The EU has asked the UK to state what wants in the way of a post-Brexit relationship. The very few ideas it has offered are too sketchy and non-starters. Yet having been told that, the UK keeps acting as if making the same bone-headed requests again will produce different answers.

I hope when May speaks Friday, UK and any European readers will give their reactions. If nothing else, Barnier’s Wednesday release, which contained nothing of importance that was not expected or previously agreed, nevertheless makes it hard to May to try to get away with yet more empty reassurances.

The hot button for the MPs is that 120 page treaty draft, which is subject to some tweaking before it is approved by the EU27, is that it set forth what the text clearly depicts as a fallback position on Ireland, as in what is proposed to take effect if no other deal is struck. The December Joint Agreement had sketched out three options, and this was one of them: what amounts to an Irish sea border, which would make Northern Ireland subject to EU regulations. Of course, that makes Northern Ireland less than a full-fledged member of the Union, a position that is unacceptable to the DUP and at the same time a very useful precedent for Scotland.

With the benefit of hindsight, it was inevitable that despite the EU correctly trying to make the UK responsible for solving its Ireland problem, it was going to wind up on Barnier’s desk. There is no answer that does not involve a hard border somewhere, and the UK simply isn’t prepared, politically or practically, to deal with the implications. The UK is stuck on yet another Brexit fantasy, of a soft techno-magical Ireland/Northern Ireland border. There is no way the EU27 will accept that because it would serve as a way for goods that don’t conform with EU regulations to flood in. Chlorinated chicken, anyone?
So the EU was destined to be the heavy.

Even though the hissy-fitting over Ireland dominated the UK news, it was far from the only Brexit development yesterday.

Theresa May made a big retreat on the rights of migrants who enter during the transition. From the Guardian:

Theresa May has conceded that EU migrants who come to Britain during the Brexit transition will have the right to settle permanently in the UK…

The concession, slipped out in a Brexit policy paper by the Home Office, also makes clear that EU migrants who arrive after March 2019 will be given a five-year temporary residence permit, not the two-year one that was previously proposed by ministers.

The policy paper does, however, make clear that EU migrants who come to live and work in Britain during the transition period will not have the same rights once it ends to bring family to join them as EU nationals already resident in Britain who have secured “settled status”. Instead, they will have to pass a minimum income threshold test, which is currently set at £18,600 for British but not EU citizens.

The EU reaffirmed its position that the transition period would go only to the end of 2020.

The treaty will be under the jurisdiction of a joint UK-EU committee and unresolved disputes will be referred to the Court of Justice of the European Union. When the Brexiteers get to this section (they apparently haven’t yet), heads will explode.

The EU reserves the right to play hardball during the transition period if it thinks the UK has been cheating. The EU has not retreated much from its original position on enforcement of EU rules. From Politico:

In short, the U.K. better follow the rules and do what it’s told during transition. This and subsequent clauses make clear the EU will have the upper hand in any disputes during the transition period over alleged non-compliance by the U.K. with EU laws, rules and regulations. And if the U.K. refuses to implement a remedy of an alleged violation as ordered by the EU authorities, the EU will have a fast-track mechanism for imposing punishment — a “proportionate” suspension of certain benefits the U.K. receives from participating in the EU’s single market. This point first emerged in a footnote to a previous version of the legal text but it has been spelled out more explicitly and watered down slightly — although not much.

The EU has snuck in a fix of a major treaty drafting error…which would be a big free concession by the UK if no one is alert enough to notice. Our Clive picked this up. Admittedly, I have not read the press exhaustively, but I don’t yet see any commentary on this point. From Clive:

One thing I was on the look-out for was how the EU Draft Treaty would fudge, erm, sorry, make go away as best it can, the TFEU-created problem of — unwisely as it turned out — hard-coding into its provisions the specific references to the U.K. and it’s dependent territories. Reading the TFEU now, you can’t help but chuckle that it’s naivety was such that it assumed that member states would always and forever be EU member states.

Fast forward a few years and the EU is now stuck with specific Treaty commitments to the U.K. (and territories) by name. How, then, to get out of that free?

The Draft seems to bind the U.K. into letting the EU off the TFEU hook for both itself and territories with regards to what it was granted under that Treaty. A similar situation applies to Euroatom (again, there is the hard-coded references to the U.K. in that). The U.K. might just be tempted to tell the EU “fat chance”. I guess it depends on what, if anything, the U.K. can extract in return for allowing the EU to extract itself from the now optimistic (you could say sloppy) wording of the TFEU.

The UK auto industry said no divergence, please stick with EU regulations. From the Independent:

Hundreds of thousands of British car industry jobs could be put at risk after Brexit unless the UK reaches a deal with the EU on the sector, MPs have warned.

Britain should continue to follow EU car industry rules after leaving the bloc, the Business Select Committee said.

It said it could find no benefit to the country’s automotive sector from regulatory divergence from the EU, only costs.

The verdict will come as more bad news for Theresa May whose latest approach to Brexit – “ambitious managed divergence” – was mocked by Jeremy Corbyn during Prime Minister’s Questions on Wednesday.

As all of this horse-trading is finally looking as if it might finally start in earnest, the timing is looking impossibly tight. As the Financial Times pointed out:

Mr Barnier has warned Downing Street that backsliding on terms agreed in December would have consequences for discussions on future relations and a transition deal, which Mrs May wants agreed at a summit in less than four weeks.

How can this possibly all get done unless David Davis and his team lock themselves in a windowless room in Brussels for the next month? May and her allies seem to think that the equivalent of a cocktail napkin doodle will be sufficient detail for a transition agreement.

On top of that, the reason the Tories have kept repeating the same nonsense for months on end is that they know they can’t resolve the outtrades on their own side without risking blowing up their fragile coalition. But they’ve also made their fraught situation worse through their abject ignorance.

One major misunderstanding is the assumption, widely repeated in the press, that if the UK were to be in a customs union with the EU, it would not be free to cut its own trade deals with third countries. That is not at all a given, yet it is almost universally treated as such.

The big reasons countries join customs unions is to get closer to the other members from an economic perspective, and to benefit from participating with a big group of countries in negotiating with other countries. In other words, the reason members of customs unions pretty much always participate in pacts with third countries is they see that as far more advantageous than going on their own. For instance, Turkey, which has a customs union with the EU, was upset at the prospect that it might not be included in a EU-US trade deal. Iceland, Liechtenstein, Norway, and Switzerland are members of the regional free trade association, the EFTA, and also part of the EU customs unions by being part of the EEA. The EFTA has done a whole clutch of trade deals of its own. And tiny Iceland has a trad pact with China all by itself.

But independent of the customs union confusion, the pressure on other fault lines looks about to reach the breaking point. From Politico:

Yet, for all the hullabaloo, the nub of Theresa May’s dilemma remains simple enough: She only has numbers in parliament for a Brexit which, as things stand, is not available.

If something doesn’t give, a political crisis is fast approaching….

The question, then, is not whether she can find consensus in parliament for a soft Brexit but whether she can square off pro-EU rebels in her party without alienating the 60 or so hardliners — plus the 10 DUP MPs who keep her in power — to pass a final deal in October.

What does she need to do that? Two things are essential.

One, the terms of the divorce must give a watertight guarantee of a future trade deal and tie it to Britain’s so-called exit bill. This is a red line for around 30 hardliners in Jacob Rees-Mogg’s pro-Brexit caucus, according to a leading member of the group.

Second, and most crucially, she needs the EU to agree to something approaching a soft border in Ireland which does not prevent the U.K. striking its own trade deals and does not leave Northern Ireland hived off from the rest of the country.

As we’ve discussed since the Irish question has been in play, the “soft border” idea is daft, and it’s not clear why Barnier has indulged the UK’s fantasy. One theory was that playing along would in the end make clear that the Government had promised the impossible. But the UK press and pols have already persuaded most of the public that the EU is being unreasonable and is taking advantage of the UK. As we described above, Barnier is now the heavy by virtue of formalizing one of three Ireland options that the Government approved in December. And rest assured, the particular EU countries that insist on adequate border controls to prevent an influx of chlorinated chicken will again be depicted as being obstructionist.

And as for the first “essential” term, that of a “watertight” assurance of an eventual trade agreement? It’s hard to fathom how that is possible. Trade negotiations can and do fail. Look at the Doha round, and more recently, the TPP. Requiring that a deal has to be concluded will encourage one or both parties to play non-negotiable to force the other side to capitulate. Given the UK’s demonstration of arrogance, ignorance, and rigidity, I can’t imagine the EU agreeing to anything approaching what the likes of Rees-Mogg wants on this front.

The Tories incentives are to keep the ball in play as long as possible, but the game is running out. And the more they keep dithering, the more the odds of not just a hard Brexit, but a crash-out, rise. Perhaps May will find a way to navigate through this, but one would think if there were such a path, she’d have found it by now.

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  1. Clive

    I had previously, succumbing, unwisely you might feel, to my prevailing optimism bias that the chances of a muddle-through Brexit were 80/20 (i.e. likely).

    Now, I believe we’re odds-on for a crashing out chaotic Brexit (no deal and no transition).

    This all may change. Next March is a year away. But the last — what? — 18 months have been pee’d against a wall by a stupefied U.K. government and, worse, an entirely dysfunctional U.K. political establishment. Something will probably give, but what, how and when is a huge peacock-sized fan-tail of uncertainty.

    Fasten your seatbelts, etc.

    1. Strategist

      Chaotic Brexit odds on? I don’t believe it. This week’s developments massively increase the likelihood of Remain being the outcome.

      Yes, we’ve got to get to work to make that the outcome by 29 March 2019, but none of what second referendum supporters are proposing is impossible. I don’t know what price you can get at the bookies for Remain, but that surely is where to put your money now.

  2. PlutoniumKun

    On the point of the DUP, the generally pro-Unionist Emerson Newson in the Irish Times says that:

    The DUP have played Hardball and Lost (paywalled)

    So the DUP is back where it started and has been made to look impotent on its constituents’ defining concern. In the eyes of many unionists, the European Commission has just published a “backstop” plan for a de facto united Ireland, which the DUP has already tried and failed to prevent.

    Could the DUP, a tiny regional party at odds with its region on Brexit, ever have swayed a continent-wide agenda? It would have had more chance if it had countered the EU’s argument.
    Brussels has portrayed Ireland and Brexit, deal or no deal, as an issue of protecting the Belfast Agreement “in all its parts”. Questions about trade, free movement and the nature of the Border are framed not as practicalities but as threats to an international peace treaty.
    This is a politically contrived negotiating position, as groundless and irresponsible as anything cooked up by the most extreme Brexiteers.
    The Belfast Agreement contains no mention of trade, free movement or the nature of the Border and cites EU membership only in its non-binding preamble. Brexit will not affect one word of its provisions, as found by the UK supreme court – a body still part of the EU judicial system.
    The DUP’s status as a pro-Brexit Northern Ireland party would have given it credibility to engage with debate at this level, robustly challenging the notion that the agreement is under threat.
    The DUP could have used its leverage in London to press the British government to do likewise, rather than being sucked into the language of “protection”.
    There are two unionist MEPs: one DUP and one UUP. They have not made half the noise Sinn Féin has with four.

    DUP figures have denounced claims of threats to the peace process but the party remains too ambivalent about the Belfast Agreement to ride proudly to its defence. It would like Stormont back, but devolution is the only part of the settlement it values. The parts most critical to answering its Brexit opponents are the agreement’s North-South structures. These are the parts towards which the DUP is most hostile and it has long worked to actively undermine them. It had six months at Stormont after the EU referendum to make some use of them but did not do so.
    Instead, the DUP has focused on technical aspects of the Border, making a good case that these will be manageable, but missing the point that the EU’s tactics have relegated this topic to mere quibbling. In the end, the party has fallen back on defensive unionism, clinging to a British “internal market” promise that Brussels has laughed off as a joke.
    The DUP’s handling of the Brexit talks raises a wider question about its negotiating style. There is a lot to admire about the party’s hardball stance at Westminster – traditionally, unionists who found themselves with a seat at the table were patronised and bamboozled before being ejected at the first opportunity.
    The DUP knows to get what it can, when it can, however it can. But there still comes a point when you need to know your limitations and maintain relationships. In humiliating May to no avail, the DUP crossed that line, in London and Brussels. The collapse of the Stormont talks suggests it has crossed that line in Belfast as well.

    The article is a little confused, but I think the basic point is sound – the DUP were all tactics and no strategy, and now find themselves friendless. If they vote to bring down the government, then this means Corbyn as PM, which for the DUP is like having lucifer working as your childminder. So, just like May, they have been completely outmanoevered and don’t seem to have anywhere to go, which means they will fall back on their default mode of shouting out ‘NO’ very loudly.

    I’d be interested to hear what others say, but to me the only option now available to May is to broadly capitulate (with maybe a few face saving concessions), and rely on parliamentary manoeuvres (maybe hoping Labour won’t pull the trigger on a no-confidence motion) or legalisms to stay in power.

    The ‘wild card’ in all this I think are the Scottish Nationalists. From my limited knowledge of their politics, they are waiting for their post-March 2019 chaos for their opportunity. But could they now see an opportunity to offer May a deal to keep her in power, in exchange for a deal which adds the name ‘Scotland’ to all those bits about NI staying in the CU and Single Market?

    1. Clive

      “Newton Emerson” (as I think he correctly is named ! Glad it’s not just me who gets Gaelic names in a brain fugue… inexcusably really, my mother’s maiden name of O’Rouke, which I of course have to keep recanting all the time for ID purposes, always causes my momentary hesitation because it sounds like a forename not a family’s name — so I sound shifty as a result) is probably the best commentator on NI going.

      I too think that Irish Times piece lost its way in places as it had to do a lot of NI-‘splaining for the uninitiated, but in essence it was absolutely spot-on and a good primer for anyone foolish enough to want to get up to speed with all this.

      I think myself though that May is now a passenger and will ride this particular Clown Car all the way to a Hard Brexit. Unless the SNP, Labour and (dogs sleeping with cats stuff, possibly) Sinn Fein really pull out all the stops and work the political machinations needed to stay in both the Customs Union (not, note a Customs Union) and the Single Market. Which is snowball’s chances in Hell potentiality.

      1. PlutoniumKun

        Yeah, sorry, you are right on the name, not sure how I got that wrong. I don’t often read him, I don’t find his perspective particularly interesting, but he does know whats been said behind closed doors among Unionists.

        The reason I focus on the DUP is because ultimately I don’t think May or any of the rest of the Tories give a toss about what happens in NI, and so would quite happily give it away as part of any deal that saves their skins. Its also likely that they loathe the DUP MP’s personally, because nearly everyone does. But the DUP have burrowed in with the hard Brexiters, so have an outsized influence that way (I do think their Parliamentary numbers aren’t as significant as it seems as there are plenty of other factors involved in any key vote).

        And the reason I keep thinking of the Scots is that most of the English Brexiters loathe Scotland as much as they do the EU and so would happily see the back of them too. I honestly think that the core Brexiters would quite happily see the Union break up if it gave them the Brexit they wanted. So I don’t think its far-fetched to see a deal whereby Scotland joins NI in the CU and SM (possibly under some sort of face-saving ‘transitional’ fudge), which would allow England to go its merry way, dragging Wales with it, while NI and Scotland find themselves in some sort of weird Greenland-like constitutional no mans land.

        Of course, a border with Scotland is far more technically difficult to achieve than one on the Irish Sea (contrary to what Unionists will tell you, there is already a de facto border there at the ferry terminals).

        Having said all that, I think it is still most likely that London will find itself unable to make any decision whatever, and the ship will sail on with no rudder.

    2. Colonel Smithers

      Thank you, PK.

      I agree with you about the Scots and had been thinking the same, not just about the Scots, but Sadiq Khan’s London, especially with local elections due in May and Labour polling well in a city that is overwhelmingly remain.

    3. Alex Morfesis

      Sounds as Corbyn is not ready to lead…lucifer will still have to do childcare for the dup if he becomes prime minister…perhaps he should start acting as one(as a prime minister…not a devil…although sometimes it is better they fear you)…

      put a big number ten on the fence in front of his home…and then be man enough to walk up to dup and ask them if they want to be part of a strong united kingdom or just the caretakers at an old abandoned cemetery…

      May has abdicated her responsibilities in return for some mention in some history books her great grandchildren might point to one day…hold on there…

      does she even have any nephews and nieces ?

      Nien nyet nicht…

      She is holding on to power for powers sake…

      Corbyn needs to take the steps to lead…throwing away his frumpy brown professor jackets and wearing a respectable outfit was certainly useful but…he is getting awful close to a sell by date…

      Sitting around with a great big “ahhahh” gomez adams smirk is not leadership…

      The answer is he must do the impossible…work out a deal dup will trust in…with the dup…

      Insanity it may appear…but these are sadly interesting times…

      krazy (out of the box action) is the only remedy…

    4. Marlin

      In the comment section of the Guardian several people have pointed out, that there are still militant republicans/nationalists in NI, who would very likely consider physical boarder posts as cause to take up arms. So the question, if the legally enforcable parts of the GFA don’t make it impossible to have a physical boarder and if it could practically be managable aren’t the only relevant questions. There is a significant chance, that any Brexit not involving full regulatory alignment (and therefore producing the necessity of a physical boarder), ends in a militant revival.

  3. Colonel Smithers

    Thank you, Yves.

    “But the UK press and pols have already persuaded most of the public that the EU is being unreasonable and is taking advantage of the UK.” That’s all that matters. You may have noticed that John Major spoke at a Creative Industries forum. There are many practitioners around to help May et al get the PR right.

    1. PlutoniumKun

      What did you make of that speech, Colonel? I was wondering whether he was just enjoying himself at May’s expense or whether he was flying a flag for some sort of pro-EU rebellion among Conservatives.

      1. Colonel Smithers

        Thank you, PK.

        I reckon both, especially as some of his old enemies are still around.

        1. Colonel Smithers

          I should have added that the grey man of British politics has somewhat grown in stature in retirement. This said and at a time of inclement weather, his privatisation of the railways is unforgivable.

    2. Anonymous2

      Thank you Yves,

      One question which I never fully answer to my own satisfaction is whether some of this is kabuki theatre, but what is going on is a dangerous game if that is the case, with hostages to fortune being given very freely.

      I am wondering also if some in the UK government are hoping the Italian election will change the political weather sufficiently for them to benefit. If I was them I think I would now wait to see what happens there before deciding which way to go. The choice at present for the UK seems to be between vassal state and crash-out, but I hear whispers that there could be support from the UK for an EEA/EFTA solution. There really is no satisfactory way forward for the UK, as all three of these have or can be presented as having significant downside, but if the press barons can be persuaded to say the outcome is a success then the problem can be reduced.

      One of my worries here is the excessive influence of Murdoch, who is said to hate the English. Would you put the fate of your country at least in part in the hands of a soon-to-be 87-year old megalomaniac? My worry is he wants to see crash-out, as it would do much damage to the UK, both internally and with regard to its place in the world.

      1. Synoia

        Murdoch attended Oxford in the early 50s. I cannot believe his Australian way earnt him applause and caused the British upper class to welcome him with open arms.I suspect there were many convict jokes made within his hearing.

        Friends come and friends go. Enemies accumulate. .

  4. BillK

    All the tearful wringing of hands about the disaster of a ‘hard’ Brexit is coming from the Remainers party. The majority voted for a ‘hard’ Brexit and would welcome it. Money doesn’t drive every decision.

    1. Anonymous2

      Nonsense. There is no majority for any one form of Brexit. That is part of the problem.

      1. BillK

        Agreed that nobody voted for any particular detailed Brexit plan. How could they? The majority voted for ‘Get out of the EU jurisdiction and control UK immigration’. (And damn the consequences). That was good enough.

    2. Andrew Dodds

      How do you know?

      A narrow majority voted to leave the EU – that is all. In the campaign, promises were made to stay in the SM and CU, so it really can’t be claimed that there was a majority for hard Brexit.

      Had the question involved a hard brexit with all the known consequences explained, I doubt it would have got 35% of the vote. As it was, people seemed to think they could vote to get rid of eastern european immigration and ‘brussels red tape’ (mythical or not) with no consequences – indeed, at an overall profit. That was never going to happen.

      1. Pinhead

        Andrew Dodds is spot on. There should be a second referendum which, quite probably, would cancel Brexit. If Jeremy Corbyn were a true leader he would insist on it. He still has a few months left to do the right thing and win No 10. The alternative is likely to be a crash-out.

        1. Clive

          That’s a lot of certainty being expressed for such a nebulous matter.

          Every day, people make choices which put their happiness and sense of morality about what the right thing to do is and what the wrong thing to do is ahead of personal prosperity. So Brexit will make the UK poorer? But it’s a neoliberal fly paper which says that we’re all only motivated by getting more for ourselves in terms of wealth.

          Take me, for example. Do you think that I haven’t passed up on many opportunities to be “better off” because the things I’d have to do are not in line with my value system? Especially since I work at a TBTF, so it’s not like I don’t have options available right at my fingertips. And I know what you need to do to be a top flight TBTF producer. I’m clever enough to pull it off and I have an excellent grasp of the practicalities of what you need to do. And I can quite easily be, when the need arises, sufficiently ruthless to see it through. But I have forgone at least the upper echelons of personal gain because I will not willing exploit and degrade others. If I feel that something is wrong, if it violates my own internal red lines, I’ll pass on the chance to get ahead of the game, all in the blink of an eye. And I’ve done that consistently for over 30 years, so it’s not like I’ve flip-flopped and had malleable moral fibre.

          So if a fair chunk of the UK population thinks the EU is rotten and has the potential to be even rottener, and leaving is the only way, having exhausted all other options, of at least getting the country out of the grotesqueness which has seeped across Europe, then so be it. Poorer, but happier it is, then.

          Conversely, if I’m in a minority, then, fine, that’s what others are okay with so I’ll go with the flow, that’s why we have a democracy. But then I will insist on the sham pretence that, in the EU, we have discernible sovereignty being publicly acknowledged and debunked. If Brussels acts in practice like it wants to impose direct rule on the member states, then it can have it. I’m not really bothered either way. In that event, though, the UK parliament has to go — it will have on both the facts and on the demonstrable law which we’re subjected to have shown itself to be no more than an expensive ornament and of ceremonial value only.

          And that’s just me. There are c. 60 million others each having their own internal dialogue on Brexit. Or just ignoring the whole thing because they’re just not that in to it. But you can’t say that, given another vote, it’ll all be nice and straightforward and tah-dah, Remain wins the day. And that’s before you get to the whole “when it comes to the EU, voters keep getting asked to have a free vote and make their choices; and if they don’t vote the right way, you keep on asking them to vote again until they do” festering sore for the future.

          1. Lead Bow

            I’d offer the view that if a referendum was held again there would be a largish number of people now recognising that the realities/practicalities of leaving are rather different from the cloud-cuckoo land of milk and honey they were fed by the pro-Brexiteers before the first one – and which they had no grounds to challenge or reason to disbelieve. And it would not take many of these to swing the result the other way.

            I certainly can’t see anything has happened in the last year that might persuade an originally anti-Brexiteer to change his vote.

          2. Knute Rife

            I figure there are really just one of two ways this can go: 1) Remaining on the current track, which leads to Crashout, followed by a lot of regret and resentment toward those who brought it about, or 2) Changing tracks by throwing the Return switch and remaining in the EU, followed by a lot of regret and resentment toward those who brought it about. I know which is more likely, I have a strong opinion on which would be better for the UK, and I can’t imagine Corbyn isn’t doing the calculus of going to all the effort of changing course only to end up having the mob turn on him for “leaving the country at the mercy of the Brussels bureaucrats” (and simultaneously saving the Tories from themselves).

            1. Andrew Dodds

              Well, the danger is that even a ‘crashout’ is blamed on the EU. If you think the country has divisions now, imagine the effect of a sharp recession and sharp cutbacks on people who thought things would be better after Brexit. They could blame themselves for voting for it, or they could follow the Daily Mail et al line and blame the EU.

            2. BillK

              This sounds about right to me. Either way about half the country will be angry and resentful.
              But remember that the half that voted for Brexit were already angry and resentful because they feel ignored and not part of the London EU gravy train. As in the USA, growing inequality is fueling social disruption.

  5. David

    A point I forgot to make in our discussion yesterday is that the EU draft puts arrangements for NI in a separate Protocol, rather than the main text. This is reasonable in itself (the same is done for the Sovereign Base Areas in Cyprus) but it gives it a much higher profile, and would also enable discussions on the subject to be split off easily into a dedicated working group, if we ever get that far. But the Protocol is an impressive document, and has nearly two pages of preambular paragraphs (“Recalling”, “Affirming” etc) which are not legally binding, but establish an agreed political context for the politically binding bit. At first sight, it seems odd that the EU should have devoted so much time to these paragraphs when other Protocols are only sketched out. But the preamble really hammers home the alleged link with the Good Friday agreement, and I think its purpose is to put moral pressure on the UK, by making the subliminal argument that only the EU’s solution will guarantee continued peace. Normally, language such as this is written by the yard (or meter) and is seldom controversial. Here, it puts the UK even more on the back foot than it was already over the subject, and increases the relative visibility of the NI issue compared to others.
    I don’t think the EU expected for one moment that the UK would agree to all this, but I think the Protocol was quite carefully prepared to force the issue, and to create a crisis. The advantage of doing so is that NI is something everyone can understand vaguely (as opposed to jurisdictional issues for example) and can have an opinion about. I have started to wonder whether the EU has effectively given up on May’s government and is seeking to provoke either an outbreak of sanity, or failing that, a political crisis which will remove the current government, and replace it with one they can negotiate seriously with. After all, nothing can be worse than the present situation. in any event, I don’t think we are really in a “negotiation” any more. This is crisis management, and from the EU’s perspective it would be better to have May’s government disintegrate now than a few weeks before the Article 50 deadline.

    1. PlutoniumKun

      I tend to see the fingerprints of the Irish government in that – the textual emphasis on the Good Friday Agreement has Dublin written all over it. I think the EU is bending over backwards to emphasise that it has Dublin’s back on this (whether it has in reality is a different matter, but I think those optics matter very much to Brussels, as it has to be seen as defending smaller members against bigger non-members or soon-to-be non-members).

      I do think the EU has simply given up on the UK government. For a while I think they were worried that the British were playing dumb in order to spring a surprise, but now they realise that yes, they are actually dumb. I suspect they no longer care so much if the EU is blamed for failure by the British. The focus now is on minimising damage, and imposing a transitional agreement is their way to do this. I don’t think the EU fears so much now that the Uk will be seen as a model for other Eurosceptics, they are a laughing stock now, even among European Eurosceptics.

      I would doubt though if they are actually trying to force May out of power – I think the working assumption from last June was that May would not survive, but I think the preference in these situations is always the devil you know. But i do think they want certainty – either a legally binding agreement, or a definite no-deal brexit, so they can prepare accordingly.

      1. David

        I don’t think the EU is trying to force May out, but, as you say, they want certainty, and that is simply not possible at the moment. The weakness of the devil you know argument is that the devil actually has to be capable of delivering something. In a very real sense the EU is not negotiating with May at all, but with competing factions that she pretends to be in charge of but cannot discipline or reconcile. This is why I think that they want a crisis, which may lead to May being replaced but may also lead to some cross-party initiative which at the moment we can’t foresee. After all, if you’re going to have a crisis anyway, much better now than in the weeks before the UK crashes out, when you might not even have a government to theoretically negotiate with.

        1. PlutoniumKun

          Yes, I think its a good point that they may feel a crisis would result in some sort of cross-party agreement or… well, at least some sort of movement. And as you say, the earlier a crisis arrives, the better if there is any hope of salvaging something.

    2. Yves Smith Post author

      Agreed, although what I still cannot fathom is why they rescued May in December with the Ireland headfake. Maybe they were convinced, and probably correctly, that she’d be turfed out if they didn’t, and the UK press made it seem likely that Johnson and his lot (gah, and Rees-Mogg) would take over the Government. Now it’s clear that while they can check May, they don’t have enough votes to win a leadership fight.

      Does anyone have a theory here? It’s moot now, but I thought the EU would have been better served if the crisis, which seemed inevitable given all the contradictory and unattainable things the Government had committed itself to, happened sooner rather than later.

      Having said that, May’s ability to hang on has been remarkable, but that’s in large measure due to the tenuous hold the Tories have on power.

      1. Mark P.

        Does anyone have a theory here?

        My understanding of the EU’s workings is less than yours at this point, and derived mainly from following the case of Greece and reading Varoufakis.

        But there’d have to be a few factions spread across Brussels, the ECB and similar institutions that — especially in the wake of the ordoliberal-neoliberal austerity implemented in Europe over the last decade — would absolutely not want a leftist government coming to power in the UK and doing the MMT-style re-nationalization and infrastructure programs that Corbyn, McDonell, and Labour have indicated they intend.

        Wouldn’t there?

        1. PlutoniumKun

          Not really. The Conservatives long ago cut themselves off from the mainstream centre right in Europe, so there is no love lost for them, even among their erstwhile ideological allies. And since the UK has been absolutely central to the privatisation and neo-lib agenda in Europe, even during the Blair years, the cutting adrift of the UK has been far more welcomed by the left and Green movements within Europe than the right. I don’t believe Corbyn is on the radar of anyone in Europe, the general perception would be that the British establishment are too deeply embedded for his election to make any difference to anyone.

      2. Lead Bow

        I cannot theorise because I’m watching all this from a pop-corn littered armchair on the other side of the world, although my heart goes out to friends and family still in the UK.

        Moreover I still have absolutely no sense of what the EU really wants. Does it secretly think it would be better off without the UK anyway, and is thus more than happy not only to let the UK make its own bed but to give it a kick in the pants as it leaves as a warning to others who might have thoughts the same way. Or would the EU actually prefer the UK to stay in and is doing its best to help it see the error of its ways in the hope it will see the light and back off from leaving?

        1. PlutoniumKun

          I think the attitude within the EU is like that of a family when a troublesome and disruptive child leaves home. A sadness and sense of failure, but ultimately relief and a feeling that in the long run its all for the best for everyone.

    3. Lead Bow

      Interesting that the sovereign bases on Cyprus get a mention. The situation regarding Gibraltar seems to have dropped off the radar. Where are we on that? And won’t there need to be a hard border between France and the Channel Islands somewhere?

  6. visitor

    The Draft seems to bind the U.K. into letting the EU off the TFEU hook for both itself and territories with regards to what it was granted under that Treaty.

    Does this mean that Gibraltar is going to raise unhinged hell from now on?

    The UK government looks like a ship of the line which already has its rig torn, the rudder smashed, a punctured hull taking in water from all sides, all after a succession of mere skirmishes — just as the main battle looms and big cannons are being pointed at it.

    1. Clive

      Gibraltar has been utterly bizarre. It’s like it’s fallen into the Mediterranean Sea or something in terms of it being a dog that hasn’t barked. Spain would like nothing more than a rock hard (I make no apologies for that pun!) border. But the EU could hardly be seen for proselytising for no hard borders in the Republic while being quite happy for them in Spain and Gibraltar.

      Conversely, if we do end up with a hard Brexit, and a hard border in Ireland, it’s virtually impossible to resist tit for tat hard borders there, too. Albeit with a symbolic rather than significant economic impact (the U.K. could keep Gibraltar supplied with not a huge amount of effort).

      Ironically, Gibraltar isn’t in the Customs Union Which does rather go to show how much of a red herring the whole Customs Union discussion is. It’s remaining in the Single Market that really counts — but that’s where the sovereignty implications are most acute. That said, being in the Customs Union gives a bit of wriggle room vis a vis a hard border (or not).

      Even more ironically, the military presence in Gibraltar offers, due to plain facts of geography, the potential for the U.K. to cause aggravation to southern EU countries — especially to small fishing vessels. I’m not suggesting this is anything other than a 10,000-1 possibility because that would mark a definite escalation of a diplomatic issue into something more. But you can’t quite rule it out entirely, these things can get a life all of their own.

      1. David

        Your mention of military presence made me think of the Sovereign Base Areas in Cyprus, retained as UK territory in the 1960 independence agreement, and currently stuffed full of aircraft bombing Syria. That agreement prevents the UK establishing customs or border controls around the roughly 250 sq km of SBA territory. But after Brexit, a non-EU nation will have sovereign rights over part of the territory of an EU nation. Will squaddies need a passport to go drinking outside the bases? Will contractors need to go through customs to deliver food? I’m assuming not, but it’s perhaps indicative that the EU draft simply says that the problem has been addressed, and the rest of the page is blank, to be filled in later.

        1. RabidGandhi

          Ironically, EU membership was sold to the public in Cyprus on the grounds that the EU would not allow part of its territory to be occupied by a foreign power. Turkey’s ongoing occupation of Cypriot territory shows just how flexible Brussels can be with ‘sovereign territory’ when it suits them.

    2. Anonymous2

      The UK Government has now announced that it is not going to implement the second part of the Leveson inquiry.

      For those not familiar with the subject, this was to be an inquiry into criminal activities at Murdoch’s newspapers. So the crooks get away.

      Section 40 of the legislation – crucial to the measures introduced following revelations of criminal activities in the English press – is not to be implemented but will be repealed.

      This is of course an outrage but is probably part of some deal relating in part to Brexit, maybe related to May’s speech tomorrow. No inquiry in return for support of Government policy by the Murdoch papers? But which Government policy will that be ? Will all be revealed tomorrow?

      Not if previous performance is any guide.

      The system stinks.

  7. Inert_Bert

    Thank you Yves,

    Regarding Barnier’s decision to “play along”, I suspect that this was more of a gesture to current member-states than to the english press. The commission will want to avoid appearing to act in bad faith towards a member-state and it knows that proffering only one “optimal” path is a strategy it has employed once too many times already.

    Letting the UK Government themselves demonstrate no practical alternatives exist, rather than imperiously stating that -once again- There Is No Alternative, keeps their powder dry. Doing so in december is both low-risk (even if there is a different but harder solution, the likes of Davis and Fox won’t find it) and low cost (the UK will only ever waste the time in between EU-summits anyway).

    And six months from now, when it is crunch-time and the English again indulge themselves with the ritual gnashing of teeth and rending of garments, the commission can point the Brussels press corps to the UK’s own red lines and all the options it has “helpfully” pointed out to the Brits over the past years, before it puts the boot in. Barnier’s stepladder-sheet, while sincerely -humiliatingly enough- primarily directed at the UK government and media, also fulfilled that function, I think.

    An important note here is that on the continent, Brexit is politically inert, even most euro-skeptics won’t touch it. It still doesn’t hit the front page very often here so news and analysis about it is generally meted out dryly, by specialized journalists from the Business-section who have some idea of how things work and who are still allowed to defer to experts because they aren’t expected to constantly feed into larger bellicose narratives of national destiny.

    1. David

      Yes, if you are in a negotiation which you decide will fail, there are two things to do: avoid looking like the guilty party, whilst choosing the moment to wield the knife if you have to. December wasn’t the right time, because the EU could not control, or even greatly influence, what would happen afterwards, if they publicly said that the conditions for continuing the negotiations had not been met. As it is, they still have the UK, notionally at least, involved in a process which they largely control, because the British government is so useless. By being reasonable, and producing coherent proposals and texts, they will later be able to say that they did everything they could until the last minute. This is not for UK consumption (they have given that up as a lost cause) but rather for other EU states. Barnier has his own position with the EU 27 to think about, and the Commission is not universally popular. I agree, by the way, that Brexit doesn’t seem to have much traction in Europe – it’s reported factually, but without particular emphasis in the French media for example;

      1. PlutoniumKun

        Yes, I’d agree with this. I think the EU establishment is well aware, and has been from the beginning, that it will be an almighty car crash, but its better from their point of view to play the game, both to buy time to insulate themselves from the coming calamity, and to appear internally and externally to be doing their best to come to a good deal. I suspect there has been a lot of internal pressure from the smaller countries, in particular Ireland, Denmark and the Netherlands, to at least make the best possible effort at a deal.

  8. Expat

    Re: The Irish Border
    One of the psychological selling points of Brexit and general anti-EU sentiment in the UK has been the quaint notion that England stands apart and alone, a bastion of sense and reason physically protected from the evil overlords in Brussels by the English Channel. Seems they don’t really know their own geography or have put Ireland out of their collective minds as a self-defense mechanism (English history in Ireland is hardly salutary).

    The Brexiteers seem to think the border is special or different because it is attached to them, rather than across a body of water. The EU will no more allow a porous Irish border than it would allow free access to the EU market by ship.

    Delusional Brits still see themselves as fighting the Battle of Britain, standing alone against the invading hordes. If only they would openly admit that their entire ruling class is French and German, they might get over themselves, come to their senses, and stop this hissy fit from damaging the country.

    Pride and Stupidity, alas, go hand in hand.

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