Article 50, Backstop, Brexit, Negotiating, Theresa May

Where next on #Brexit… My Modest Proposal

This blogpost was written on Sunday, Dec 9th, 2018

BoJo

It is impossible to say what will happen in the week ahead, other than it appears that the May government has little chance of winning the Tuesday’s vote on the proposed Brexit Withdrawal Agreement.

How things play out after that it is anyone’s guess.

Much will depend on Tuesday’s numbers, particularly the government losing margin. Such is the state of things that there are even suggestions in today’s Sunday newspapers that May could delay Tuesday’s vote as she does a “Maggie May” dash to Brussels to demand changes to the deal, specifically the removal of the Irish backstop. Goodluck with that.

No matter what happens, the choice facing the UK is clear: stay in the EU or leave the EU.

Many will say that this was decided by the June 2016 referendum. Since then, however, much new information on what leaving the EU involves and the price to be paid has become available.

In our ordinary, daily lives when making a major purchase there is often a “cooling off” period in which we get to think again and cancel the purchase if we so wish. When making major constitutional and economic decisions countries are entitled to reflect on their first decision and think again.

There is nothing in democratic theory or practice to say that any decision is “sacred” and can never be revisited because it is the “will of the people”. Simply put, there is no such thing as the “will of the people”. There is only a particular decision made through the ballot box by a particular majority on a particular day. Majorities can and do change. Which is why we have general elections every four or five years.

To say that people should be asked to think again about Brexit in light of new information is not to insult them, to call them stupid or to suggest they were duped in 2016.

People voted for Brexit for a variety of reasons. Some because they believe that any UK involvement in the EU undermines British sovereignty. Some because they genuinely believe in a free-market, small-state, deregulated Britain as the road to prosperity and they see EU membership as blocking them from going down that road. Many, especially in Labour heartlands, voted to limit immigration from the EU which was seen as undermining wages and putting intolerable strains on public services.

It also has to be said that many voted for Brexit because they were told it would be easy and painless, over before you know it. The negotiating position of the UK would be so strong that the EU would be only too willing to give it a deal that would allow it to keep all the things it liked about the EU while walking away from the things it didn’t like. That has not turned out to be the case.

When the facts change, people are entitled to change their mind. At the very least, they are entitled to be asked if they want to change their mind.

Sure, a second referendum campaign could be brutal and divisive. But, quite honestly, all politics are brutal and divisive when there are major issues at stake. Think of the miners’ strike or the poll tax demonstrations. Think of the decision by the Blair government to join the second Iraqi war.

So, a second referendum is a possible option.

But would a second referendum, if it were held now, settle the issue? I don’t think anyone knows.

Certainly, if Leave won again that would be that, but we would still be left with the question: leave on what terms? If Remain won by a large majority that could also settle matters. But what if Remain were to win by just a couple of percent? Would committed Leavers accept the result? More than likely, they would not.

This, of course, assumes that the House of Commons could agree on the question(s) to be put to a referendum. Would it be binary: the Withdrawal Agreement or remain in the EU? Could it be more complex: the Withdrawal Agreement, remain in the EU or leave the EU with no agreement?

There is a very strong case to be made for the House of Commons making the decision, as opposed to having it made through a second referendum. Some suggest that there is probably even a stronger case to be made for the Commons to take such a decision after a general election, with the newly elected members having a fresh mandate.  But given the splits in the major parties over EU membership it is difficult to see how the EU issue would be argued during the campaign.

An election would not be a matter of: vote Labour and this is what you get; vote Conservative and you get the opposite. While a general election could see a change of government, it might not affect the parliamentary numbers when it comes to Brexit. It could be back to square one again.

Could there be another way forward? Let me try to suggest one.

At the outset of the Brexit process the UK government had wanted to negotiate Brexit as a “package”, covering both the withdrawal terms and the substance of the future economic relationship between the UK and the EU.

The EU refused to do this on the grounds that it could not negotiate future economic and trade arrangements that differed from the terms of EU membership with an existing member. This could only be done after the departing member had actually left.

It has always seemed to me that the EU was on solid ground in refusing to do this.

First, it would be impossible to agree anything of substance in just two years.

Secondly, how could you negotiate with a country that had an active role in your decision-making structures?

Would any country be able to resist the temptation to use that role to exert pressure on the negotiations? Remember, in the run-up to the 2017 general election in the UK, the UK government blocked that year’s EU budget on the somewhat flimsy grounds that it could not tie the hands of the incoming government.

In reality, everyone knew it was a negotiating pressure tactic.

Conversely, there have to be some arrangements in place for the moment a country leaves the EU. It is next to impossible to move from being a member to being a non-member overnight, falling out of the thousands of procedures and agreements that constitute the EU’s acquis, as well as those treaties that regulate relations with other countries. A no-deal, overnight Brexit would be an economy killer.

The solution to this problem is the transition period.

During the transition, which begins on March 30th, 2019 and runs until December 31st, 2020, though it can be extended by a further two years, the UK will continue as if it were an EU member, following all EU laws, including new laws, though it would no longer be involved in EU decision making. It would have no EU Commissioner, no members of the European Parliament, no judge on the European Court. During the transition the EU can negotiate future economic, trade and other arrangements with the UK because it will now be a non-member.

Could an extended transition period, say five years, offer a way out of the current impasse?

At the end of the transition period, however long it is, and when the full terms of the future relationship are known, the UK should have the option of saying: “Thank you, but now that we know in detail what is on offer for our future outside the EU we’d like to change our mind and stay”.

Certainly, the EU should be entitled to insist on some changes to the UK’s existing terms of membership, but this should not be an insurmountable obstacle to renewed membership.

Something along these lines might work for everyone, bar the ultras. For Leavers, the UK would officially have left the EU, thereby discharging the referendum mandate. Remainers could take comfort from the fact that during a prolonged transition the UK was still a de facto member of the EU.

For all parties, all future options, from “Canada” to “Norway”, including renewed EU membership, would stay on the table. Yes, the UK would have no say in EU decision making and would have to make budgetary contributions, but it was the UK that started the fire in the first place.

And a prolonged transition gives business breathing space.

To say that the Brexit negotiations to date have been difficult is an understatement. But those difficulties will pale into insignificance compared to the difficulties that lie ahead. Most negotiations are either a zero-sum or positive-sum game: win/lose or win/win. If the pot is 100 and before we begin negotiations I have 60 and you have 40, but afterwards I have 65 and you have 35, that is a zero-sum game. I win you lose. But if during the negotiations we find ways of making the pot 120 and I continue to have 60% and you 40% we are still both better off. We both win. A positive-sum game.

But Brexit is different. It is a zero-zero-sum game in which both sides will be worse off. The pot will be less than the 100 it now is.

In such a situation the leverage of the stronger party will be decisive as no rational actor is going to take losses to help the weaker party out, especially when it was the weaker party that initiated the process.

The EU is some six to seven times bigger than the UK and is considerably less dependent on the UK than the UK is on EU markets. Effectively, the EU will dictate terms. To put it at its simplest, the EU will say to the UK: “If, as a non-member, you want to ‘buy’ access to our internal market and all that goes with that, here is the price”.

Over the past sixty years the EU has been working to build an integrated European market. It has largely succeeded in doing this when it comes to goods, not so much when it comes to services, though it has gone further than any other part of the world. The economies of Europe have become deeply intertwined with one another, as cross-border just-in-time supply chains attest.

No country has ever left the EU before. No country has ever said it wants to move away from the EU’s internal market, to diverge from the standards required to trade in that market. By definition, Brexit will create barriers where none previously existed. No one can say with any degree of certainty what the cost of this will be, economically and socially.

Decisions such as Brexit should not be rushed. Prudence suggests that time should be taken. A five-year transition, with all options including renewed membership explicitly on the table, would provide time for the costs and benefits of Brexit to become clear.

At the end of the transition the people of the UK could be asked by way of another referendum: now that we know what deal we get outside the EU, do we still leave or do we change our minds and stay?

If technology is going to solve the Irish border issue, then five years should be more than enough for that technology to be developed so that the backstop may not be needed in the event that the decision is still to leave.

What I am suggesting is this:

  1. The UK leaves the EU on March 29 2019, on the basis of the Withdrawal Agreement (financial settlement, citizens’ rights, Irish backstop).
  2. The transition period be extended to five years
  3. During the transition all options are on the table, including the option to remain in the EU when it comes to negotiating the UK’s future relationship with the EU
  4. The UK government commit now to putting the outcome of these negotiations to another referendum at the end of the transition period, giving the people the choice of going ahead and leaving or changing their minds and staying.

Sometime, a little time is all that is needed

One thought on “Where next on #Brexit… My Modest Proposal

  1. I don’t think this will be much help (I do like the reference title, but it’s less drastic)
    The anti-EU hate + racism is still strong in GB, and many People, instead of edcuating themselves on Facts, still believe Sun, still say “Project Fear” to Facts of No-WA-deal, and just want to get the whole Thing over with.

    Rejoining EU (not remaining, because that would be over) but under worse Terms = rebate gone, Special British considerations gone, would be even more difficult to sell to British public than revoking Art. 50 and remaining as is.

    Also, if Mays deal with Transition period would be implemented, Tories would stay in power because the catastrophe of crashout wouldn’t happen (and because Labour isn’t acting as Opposition). So Tories wouldn’t work towards anything, Keep lying about Fantasy as they’ve done for the past 2 years.

    Like

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