The hour of BRINO

24 February 2018

So far this year, we go round in circles. Or to put it another way, nothing has happened to render the UK’s departure from the EU more tractable. Ludwig Wittgenstein famously advised us, wovon man nicht sprechen kann, darüber muss man schweigen - whereof we cannot speak, thereof must we remain silent. But sometimes we must break our Wittgensteinian silence - we must remind ourselves of the stubborn fundamentals. They are:

  • If we remain in the Customs Union, pan-European supply chains remain unbroken and Northern Ireland is spared the risk of a hard border, but the UK cannot negotiate deals in goods with third parties.
  •  If we remain in the Single Market, the City can carry on as present, but the UK cannot negotiate deals in services with third parties or control immigration from Europe.
  •  During the 2016 referendum campaign, Remainers made much of the argument that a “Leave” vote implied departure from both, but now argue that it did not.
  • During the referendum campaign and subsequently, Leavers called for bespoke arrangements: once “having our cake and eating it”; since the Cabinet’s Thursday awayday, “ambitious managed divergence”; throughout - most recently by Donald Tusk yesterday - dismissed by Europe as “cherry-picking”.

Since my last blog, such straws in the wind as I’m picking up point nowhere in particular.

  • Britain’s “Chief Trade Negotiation Adviser”, Crawford Falconer, much fêted on his appointment last June as Liam Fox’s Second Permanent Secretary, has gone semi-public as to his frustration at being unable to negotiate deals with third countries.
  • The financial services arena has recovered from the denial characteristic of the first few months after the referendum, to a more customary “let’s make it work” approach, driven by three strands: (1) the imaginative skills of corporate financiers and their advisers as working up ingenious proposals for regulation, intended to satisfy all parties; (2) city practitioners as so alive to London’s role in keeping Europe’s financing costs down, as to risk overlooking European appetites for control; and (3) the Bank of England as the key domestic player, with its obligation to manage systemic risk trumping all else.
  • Strangulated exchanges between British and European officials regarding transition arrangements mean little or nothing. A comma here, an annex there will have scant effect on transition itself. Its lineaments are clear: two years more-or-less, titular jurisdiction by the ECJ, modified by working arbitration by a joint committee; mutual commitment to maintain “sincere co-operation”, ie, not to mess each other up; and squabbles on financial regulation and fishing deferred to “end-state” negotiations.
  • On a point of the policy-wonkiest, I have to hope that there’s a typo in the UK’s proposed text for “Article X+1, [3a]” (honest!) of the Transition Agreement. This calls for legal interpretations which follow EU rulings “…given before the end of the period”. Surely the legal draftsman must have meant “…before the beginning”. But let it pass.

-o-

Now to domestic politics. The Remainers are marshalling their forces for a final battle. The fronts are the Courts, Parliament and public opinion. Their first tactic is revocation, that is withdrawing the Article 50 notice, if the Courts so permit and public and Parliamentary opinion can be so swayed. Their second tactic is BRINO - Brexit in name only- that is staying in the Customs Union and the Single Market if the Parliamentary arithmetic can be squared. So we are in for a few weeks of much earache as well as - in Leave constituencies - focussed billboard and social media. Ostensibly targeted at local opinion, this is also intended to give Labour MPs cover to vote their conscience as “Remainers”, by throwing up smoke about the resolve of their constituents.

With whatever reluctance, I have to tip my hat to May. She has turned her weakness into a management style, combining silence, delay and fudge. To be fair, that is often the politician’s business, but by heavens these are times calling for inordinate skills. These turn out to be hers. Will the bough break? It could. Tory MPs are too scared of Labour gains in the forthcoming council elections to rock the boat. On the other hand, seeing off the Remainers’ parliamentary manoeuvres will call for whipping skills from an office often all at sea. And the Europeans could yet overplay their hand, giving Rees-Mogg and the European Research Group plausible grounds to call for a walkout.

-o-

The next few days will see the second round of ministerial Brexit speeches, intended to draw together the Tories and - less plausibly - the country. May could come to her concluding speech carrying tablets hewn from Mount Sinai and incised with heavenly fire: she would still get hammered. We will then have to wade through a brief but powerfully expressed campaign to take the exit out of Brexit. I hope with all my heart that the hour of BRINO will pass without effect, as I cannot imagine a more disastrous outcome. Never mind about Germany after WW1; the US of late tells us in clarion tones that action capable of construction as “a stab in the back” ends up badly. If the Government cleaves to its path, we will have a transition agreement by the end of March. As this will be full of fudge, the following six months will be as wearing on the digestion as might be imagined. Andrew’s Liver Salts, anyone?