Brexit will never be done.
Because it can never be done. Not for as long as the UK sits 50km off the European mainland and does 50% of its business with Europe. Not when the island of Ireland sits behind it – and the north east corner of that island is contested political ground.
Brexiteers may wish the UK was in the middle of the Pacific, as far away from Europe as possible, but that is not going to happen any time soon. Actually, it is never going to happen.
Brexit, for the Brexiteers, is a labour of Sisyphus. Just when they think they have pushed the boulder of absolute sovereignty to the top of the hill it rolls back again to the bottom requiring yet another heave to get Brexit over the line.
But unlike Sisyphus, Brexiteers are not tormented by this eternal labour. Because if they ever got to the top of the hill they would not know what to do. As Matthew Parris points out in The Times, David Frost’s fight with the EU is political thuggery, but thuggery which makes good, internal, UK political sense for the Tories. The Tory base always loves a good fight with Johnny Foreigner, a point also made by Rafael Behr in The Guardian.
But let’s leave the politics of Brexit to one side, important as they are. They will be a serious issue for the future if the UK continues to look for opportunities to pick fights with the EU.
Two months after the UK finally left the European Union’s Single Market and Customs Union (SM/CU) at midnight on December 31, 2020, what early conclusions can be drawn about the success or otherwise of Brexit?
The first thing to be said is that Brexit is “legally” done. The UK, with the partial exception of Northern Ireland, is completely outside the framework of European law and the jurisdiction of the Court of Justice of the European Union (CJEU). If Brexit simply meant leaving the EU, then Brexit has been a success.
But how do you decide whether or not Brexit has been an economic success when Brexiteers deliberately refused prior to the 2016 referendum to say what Brexit would mean in practice? It was a case of BYOB, Bring Your Own Brexit, which allowed voters to take whatever meaning out of “Take Back Control” they wanted.
As every labour relations negotiator knows, if you go into a negotiation without clear and precise objectives the other party will end up setting the agenda. This is especially true when the other party is in possession of the “status quo”, as the EU was in these negotiations. It was the UK that was leaving and asking for new terms. Those terms were never going to be as good as the terms it had before it left.
Brexit was sold as painless, all upside and no downside. Just recall some of the statements made by leading Brexiteers over the last number of years:
- The day after we leave, we hold all the cards and we can choose the path we want – Michael Gove, April 2016.
- We hold all the cards. We will offer them a deal in response to the pleas for help – Patrick Minford, June 2016.
- There will be no downside to Brexit, only a considerable upside – David Davis, October 2016
- Getting out of the EU will be quick and easy, the UK hold all the cards – John Redwood July 2017
- The deal that we will do with the EU should be one of the easiest in human history – Liam Fox July 2016
- I think we could very easily get a better trade deal than we have at the moment – Douglas Carswell, June 2016
Five years on and it is now clear that the UK did not hold all the cards and the negotiations between the EU and the UK did not turn out to be the “easiest in human history”.
Did the UK get a better “trade deal than we have at the moment”?
The answer to that question is beyond doubt. No, it did not get a better trade deal.
The terms of trade between the UK and the EU are now considerably worse than there were previously. Of course, this would not matter if there were compensatory opportunities on offer elsewhere.
But, for now, there aren’t and the UK’s foreign secretary, Dominic Rabb, is advising companies that they need to take the Brexit “hit”, move on, and look forward to the global opportunities in ten-years’ time.
Business sector after business sector, just two months in, are now complaining bitterly about the obstacles they face in trying to do business with the EU. A random sample:
- British firms are warning of an escalation in Brexit red tape as the government prepares to introduce a long list of new controls on imports from the European Union in April and July. here (However, an article in the Observer (07/03/21) says that: Ministers are preparing to relax post-Brexit plans for border checks on food and other imports from the European Union because of fears that they will further damage trade and could lead to severe shortages in UK supermarkets. The UK, in other words, does not have the border infrastructure to manage Brexit.)
- A survey from the British Chambers of Commerce/moneycorp showed that 44% of exporters would grow their business in the EU, but that 23% want to “either reduce their activity in the EU or have no activity at all” in the next 12 months. here
- Brexit is closing doors for UK architects working in Europe here
- Cornish fishermen slam ‘disaster’ Brexit deal in BBC Two show here
- EU sources have claimed the UK rejected an offer to allow performers visa-free touring because it wouldn’t allow a reciprocal exemption. here (But even as it shreds the services deal it has with the EU the UK is planning to launch a bid to negotiate a global deal on services, as the Mail on Sunday reports. How any such deal would even get to first base without the involvement of the EU is difficult to understand.)
- If you have a long afternoon to spare, have a look at this Twitter thread.
These obstacles that UK businesses are complaining about are not new EU obstacles, freshly minted just to make Brexit difficult. They are the rules and regulations that have always applied to goods and services from “third countries”, countries that are outside the European Union or European Economic Area, r+ules that the UK helped to shape when it was an EU member.
When the UK decided to become a “third country” by leaving the Single Market and Customs Union these rules automatically applied to it. There is no “two-and-a-half” country status available for ex-EU members, “out but with a lot of opt-ins”, as the Luxembourg Prime Minister once described the UK’s agenda.
Of course, a great deal of the realities of Brexit are hidden by the Covid lockdown. As a piece in the Financial Times notes:
Brexit disruption took its toll on Anglo-French trade volumes at the start of this year, with the first hard data showing a steep decline in activity between the UK and other large EU countries.
However, as the article also notes:
… economists said it was still unclear how much of the declines in UK-EU trade were the result of Brexit and how much were caused by the fallout from the pandemic, which dealt a heavy blow to global trade in the first half of last year.
“I have a hard time deciding what is the impact of Brexit and what is simply down to the impact of coronavirus,” said Gilles Moec, chief economist at French insurer Axa.
The ban on international travel further hides matters. If it were not for the ban, how many people would turn up at airports planning to fly to a European holiday destination only to be refused permission to board because they had less than six months left on their passport?
European business trips that were once as easy to organise as taking the train from London to Manchester might now require a visa and work permit. As a report from the UK House of Commons Library says:
The UK-EU Trade and Cooperation Agreement (TCA) includes some commitments to facilitate travel for certain specified purposes. It provides arrangements for short-term business visitors; business visitors for establishment purposes; intra-corporate transferees; contractual service suppliers; and independent professionals.
But various reservations and exemptions apply. National immigration regulations, rules on work permits and employment regulations of the respective EU Member State must be observed. As a result, from 1 January 2021, UK business travellers are subject to the different regulatory regimes of each Member State. Likewise, EU business travellers are subject to the visa requirements specified in the UK’s immigration rules.
We are where we are because Boris Johnson when he became UK Prime Minister, along with his EU negotiator, David Frost, prioritised UK sovereignty over all other considerations. In leaving the EU the UK had to take back unfettered control over its borders, laws and money and any deal with the EU that could be seen as impinging on UK sovereignty was intolerable.
This was a valid choice for the UK government to make. A sovereign UK is fully free to make sovereign choices. But in this life, there is no such thing as a cost-free choice. The clue is in the word. Choice implies picking between alternatives. You can have A, but not B.
But the UK government in general, and the Prime Minister, Boris Johnson, in particular have been loath to admit that choices had to be made. To admit as much would be to deny pre-referendum assertions that the UK could leave the EU cost-free. When does anyone ever want to admit that they were wrong?
After the EU/UK Trade and Cooperation Agreement (TCA) was agreed in late December, 2020, Johnson said:
A deal that will allow UK goods and components to be sold without tariffs and without quotas in the EU market. (BEERG comment: true)
A deal which will if anything should allow our companies and our exporters to do even more business with our European friends. (BEERG comment: highly questionable at the time and now known not to be the case)
And there will be no non-tariff barriers to trade. (BEERG comment: completely untrue as the bullet points above make clear).
Because the UK government has misrepresented the deal it did with the EU to the UK public it is forced to resort to claims that the EU is being “obstructive” and “bureaucratic” to explain away the difficulties that businesses are now daily running into, or that the difficulties are just “teething troubles” that will soon disappear.
But they won’t. For as long as the UK is out of the EU’s Single Market and Customs Union then the barriers are here to stay. Brexiteers have long accused the EU of being a “protectionist racket”. Well, it is. It is protective of its internal market and the jobs of its people dependent on that internal market. The UK was once on the inside. Now it is on the outside.
The EU is in control of its borders. Once you have borders, you need permission from those who control the borders to cross those borders. That permission applies to goods, services, data, and people. It was the choice of the UK to rebuild a border between itself and mainland Europe.
UK businesses are now finding that where once mainland Europe was part of their home market it is now another country, and an unsentimental one at that. In the words of Don Corleone, “nothing personal, just business”.
Given current difficulties, are things going to get better? Can pragmatic solutions be found?
The brutal answer to that question is, No. Not as long as the current UK government remains in office and continues to prioritise sovereignty over trade.
As I write this blog, I see that the Sunday Telegraph carries an article by Lord Frost in which he defends Brexit as a reassertion of British democracy. But Frost’s article has nothing to say about the economic damage that his deal with the EU is doing to British businesses. In essence, Frost’s argument is that Brexit is “a good thing” and everyone – including the EU -should get behind it and make it work.
This passage from a recent essay by Mark Lilla, the American political writer, came to mind as I read Frost’s word
If some end — the rule of the saints, say, or the dictatorship of the proletariat — is deemed to be worth pursuing, the dogmatist needs to believe it is the only and perfect good, carrying no inherent disadvantages. Blemishes must be ignored so as not to distract the team. But once problems become impossible to ignore, as inevitably they will be, they must be explained. And so they will be attributed either to alien, retrograde forces that have infiltrated paradise, or to insufficient zeal among believers in pursuing the good. The dogmatic mind is haunted by two spectres: the different and the indifferent.
These words apply to Lord Frost and the most ardent of the Brexiteers.
But, they also apply to those who can see no wrong with the “European Project”.
The EU is imperfect and often handles things badly. It can be cursed with poor and unthinking leadership that can appear unaccountable and which pays no price for its mistakes. It needs to be a lot more self-critical.
Still, for all the imperfections, it is better for the 27 members of the European Union to work together than to pull apart. An imperfect union in which each member state has a voice is better than an Exit which leaves you with no voice in shaping the future of your continental homeland, especially as the US remains the dominant superpower and China is resurgent.
Brexit will never be done.