Uncharted Territory

June 12, 2017

The Brexit Logic Trap

Filed under: Brexit, Complex decisions, Economics, Markets, Politics, Reflections, Regulation — Tim Joslin @ 11:52 am

170612 Pic for Brexit post doh

“I think people will interpret membership of the single market as not respecting that referendum.” – John McDonnell

You can’t build a rocket to reach the Moon without understanding the laws of physics.  In politics, as in many other fields of human endeavour, we are most likely to succeed not through raw emotion, but when our goals are aligned with logic and a clear understanding of the real world.  Thus, political projects have for centuries been informed by the carefully crafted logical, evidence-based arguments of thinkers from Adam Smith to Karl Marx.

Somewhat more parochially, the UK will only resolve its Brexit conundrum by finding a solution that works in practice, not just in the fevered imagination of one or other political leader.

Why do I say we’re in a “Brexit conundrum”?  Surely we’ve voted for Brexit and should “just get on with it!”.  Well, no – putting the hard-line “Remoaners” to one side for the moment – it’s not quite as simple as that: the argument now is apparently over whether we have a “soft Brexit” or a “hard Brexit”.  Oh well, I hear from the gallery, we were going to have a “hard Brexit”, but Theresa has put her expensively shod foot in some seriously pungent doo-doo and now we’ll have to have a “soft Brexit”.

Yes, it seems to have turned out that a “hard Brexit” is not a politically viable option, though David Davis and Liam Fox are still in denial.  Nor is a “hard Brexit” economically viable, I might add.  Never mind, “just get on with it!!”, say the great British public: we’re more concerned about the NHS and inequality anyway.

Unfortunately, it’s still not quite as simple as that.

Why?  Because a “soft Brexit” is not a logically viable option.  If it was, Theresa May would probably have proposed it already, since, contrary to popular belief, she and her advisers are not entirely stupid.  No, it turns out that, no sooner have you pulled on one loose thread of the UK’s relationship with the EU, than you’re standing in front of the nation completely starkers, as Theresa May hinted during the election campaign.

For example, if we go “hard” and leave the European customs union, then, for starters, there’s a border problem in Ireland, not to mention with Gibraltar.  Huge bureaucratic costs arise for business, plus we revert to WTO tariffs on all our trade until we can negotiate something different.   Enough!   Let’s stay in the customs union, then, you say.  Oh, but then we wouldn’t be able to negotiate our own trade deals.  We need to do that to offset leaving the single market.  And trade is kind of important because we need to import stuff.  Like food.

OK, then, let’s stay in the single market.  Ah.  But then we’d retain free movement (I know I am on record as thinking that’s a good thing, but I’m trying to be detached and objective here).  And, incidentally, be subject to the European Free Trade Area (EFTA) court, which apparently doesn’t violate our precious sovereignty as much as the European Court of Justice (ECJ), though I’m not sure the great British public would be fully appreciative of the fine distinction.

Hmm, surely we can remain members of uncontroversial European agencies, Euratom, perhaps?  Nope, sorry, not unless we submit to the authority of the ECJ (which Labour don’t happen to feel is worth mentioning in their manifesto, I note), assuming we haven’t already done so by trying to stay in the customs union.

So the dilemma facing the nation’s glorious leadership cadre is to propose either a “hard Brexit” – which might not have got through the Commons even before the General Election and would lead to years of economic chaos and decades of underperformance – or opt for a “soft Brexit”, which would involve remaining in the single market and customs union, but also mean retaining the ECJ and free movement, and (presumably) land us with the same £50-100bn bill as hard Brexit would, as well as no influence over the single market and customs union rules nor the ability to negotiate our own trade deals.

In other words, dare I say it, if we don’t have a “hard Brexit” we may as well stay in the EU.

This is the logic trap in which we find ourselves.

This is why the Labour Manifesto, as David Davis correctly points out, pretty much paraphrases the Tory government’s Brexit White Paper.  Labour write:

“We will scrap the Conservatives’ Brexit White Paper and replace it with fresh negotiating priorities that have a strong emphasis on retaining the benefits of the Single Market and the Customs Union.”

whereas the Guardian’s commentary notes that:

“The [government’s] white paper [die!, evil capital letters, die!] reiterates that the government aims to secure ‘the freest and most frictionless trade possible in goods and services’ with the EU outside the single market and via ‘an ambitious and comprehensive free trade agreement’.

[The Tory government] also wants to be outside the customs union, so it can negotiate its own trade deals, but would like ‘a new customs agreement’, which should be theoretically possible thanks to new technology. … [No kidding, this really is their argument]

… [T]he UK will not seek to adopt an existing model used by other countries, but try to ‘take in elements’ of the single market in certain areas – in other words, bespoke deals for important business sectors. From the EU perspective, all this is ambitious: it sounds suspiciously like cherry-picking.”

Of course, Labour’s presentation during the election campaign was very different to that of the Tories, emphasising that they’d prioritise the economy over immigration, for example, but in essence both are just nuanced versions of Boris claiming he can simultaneously have his cake and shove it into his stupid gob, spraying crumbs and spittle in all directions.

Reality awaits.

Advertisements

Leave a Comment »

No comments yet.

RSS feed for comments on this post. TrackBack URI

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Create a free website or blog at WordPress.com.

%d bloggers like this: