Brexit: a failure of editorial judgement

Wednesday 15 August 2018  



In July 2016, Peter Lilley received from me a copy of this document, the Leave Alliance Brexit Monograph 2, entitled "The WTO Option and its application to Brexit". In it, I concluded that the option was "a very dangerous and potentially expensive option which could do significant damage to the EU and UK, the effects of which could be long-lasting".

I know he read it because, a month later he issued a rebuttal, attempting to counter my points. In fact, he only offered six points, some of which refer to arguments I don't recall making.

His core argument was that I was under-estimating the power of the status quo. "It may be logical and theoretically possible", he asserted, "to declare all existing customs and other trade facilitating agreements and procedures invalid – but it won't happen! Indeed, so far as I am aware that has never been done even to countries subject to trade sanctions".

Thus, in the view of the Noble Lord, although we might leave the EU without an agreement and, in accordance with Article 50, the treaties would cease to have effect – thereby negating all existing customs and other trade facilitating agreements and procedures – these would continue in effect.

As regards the Union Customs Code, running to over 1,300 pages, Lilley translated this into 1,600 pages and declared that "the UK can and should incorporate them into UK law, with relatively minor amendments". And this was his considered response to my comments that:
Outside the EU, though, it is unlikely that this law could just be copied out. Substantial adaptation would almost certainly be needed. This would be a complex and time-consuming process and, assuming that the UK had lost Union law as a result of the expiry of the Article 50 process, it might be an unplanned event.

No doubt a series of emergency orders could be rushed into place but, during the period when new legislation was being produced, there would be no legal code applying to UK Customs operations.

Temporary measures aside, it is difficult to see how a comprehensive code could be quickly or easily replicated, even if there were the personnel available with the necessary skills and experience. This might be further complicated by certain aspects requiring Union and international recognition.
As regards access to EU Member State markets, he offered what has become the mantra on such issues, that "the UK starts off in full conformity with EU product regulations etc so there can be no problem agreeing 'regulatory conformity' at the point of Brexit, even if we have to agree at a later stage how to avoid divergence".

And when it came to the 900 or so formal agreements that the EU has with its trading partners, these presented no problem. Said Lilley:
We should be able to novate to the UK the network of trade facilitation agreements to which the EU is party, again with only minor technical amendments. The fact that such agreements exist between all WTO members, even those which have no bilateral Preferential Trade Agreements and even between countries hostile to each other, suggests that they are unlikely to be thrown aside for bureaucratic reasons or to teach us a lesson.
Two years later, the Noble Lord is arguing in The Times that it is time to recognise that "no deal" is likely, leaving us to trade with the EU on World Trade Organisation terms.

Interestingly – and perhaps indicative of the weakness of his original arguments – Lilley does not rely on any of the points he made back in 2016. But since then, the issues have to a certain extent clarified and certain specific issues have been highlighted as constituting the downside of what is called the "WTO Option".

The more prominent of these - motorways becoming lorry parks, food and drug shortages, planes grounded - Lilley dismisses out of hand, asserting that they emanate "largely from Remainers’ fevered imaginations".

As with so many others, the man drops into the familiar binary framing – leavers versus remainers. Never mind that, long before the implications of a "no deal" exit were being rehearsed in the legacy media, this leaver was raising the alarm. But while then I might have been the focus of Lilley's scorn, I have since become invisible.

Nonetheless, the sloppiness and superficiality of the media alarums has given Lilley something of an opening, which he exploits with relative ease. "How we control imports is in our hands", he says, going on to assert that: "Lorries laden with fresh food will not be queuing for hours at Dover since Dover sees no need for new physical checks".

Undoubtedly for different reasons, I would not disagree with the man. I've written a number of times of the likelihood that the UK government would waive border checks on fresh foods coming in from EU Member States. I've pointed to the national security exemption in the GATT Agreement, on which the UK could rely. But whatever legal cover is adopted (or not), no government is going to stand idly by and let food run out. Its own survival depends on the population being fed.

As to revenue issues, Lilley also asserts "that tariffs would be collected electronically like excise and VAT". If, he says, "some firms initially fail to complete electronic customs declarations, HMRC will avoid delays by waving lorries through". Again, I don't think he's far wrong.

Thus far, the media have given him some straw men to play with, with Lilley correctly pointing out that we will continue to authorise medicines we currently import. He adds that "the EU can either reciprocate or put their patients at risk", which is a reasonable enough point.

If the EU rigidly refuses to accept medicines produced by UK holders of market authorisations, there is a risk that patients in member states will go short. The EU will have to find a "fix" for this problem, until the situation can be resolved permanently.

Lilley is on less than secure ground, however, when he cites BA's Willie Walsh, who has "dismissed fears of planes being grounded". Walsh's comment comes in the context of his believing that a deal will be made. Lilley is telling us that we should not pursue one. He cannot have it both ways. And nor can he take any comfort from his claim that continental airlines are selling tickets way beyond March 2019. At this stage, they can do nothing else.

On the other hand, one might be charitable and concede Lilley's point that "Spain would not forgo 1.5 million British tourists a month", recognising that this would give the UK some leverage when it came to settling an aviation deal.

But what this points to is a logical flaw in Lilley's entire argument. We do not rely on the WTO for our aviation arrangements and, for there to be flights to mainland Europe, there will have to be a deal. Lilley's "no deal" can't exist. There must be some deals, some of which must cover aviation.

His logic continues to fall apart when he asserts that, if the French slow down Calais, the Dutch and Belgian ports want the business and will offer speedier service. This is little short of bizarre. Apart from the fact that Calais handles volume RO-RO traffic, for which there are insufficient facilities in Holland and Belgium, he has clearly lost sight of the fact that we are dealing with the EU and its common regulatory code. What applies to France will also apply to all other EU Member States.

But we then go from the bizarre to the evil. The application of the Member States of the EU acquis - which they are bound in law to apply – is characterised by Lilley as "hostile non-cooperation", something which is manifestly false. After all, one of the primary reasons for leaving the EU, cited by Vote Leave, was to "take back control". Inside the EU, we are bound by EU law.

But the man develops this with a completely specious argument, making out that this "hostile non-cooperation" would be "not only impractical but triply illegal". Says Lilley:
It contravenes the EU's constitution, which requires it "to establish an area of good neighbourliness" with neighbouring countries; the WTO treaty which forbids discrimination against trading partners; and the new trade facilitation treaty which commits members to facilitate trade not obstruct it.
None of these things are true in the context of prohibiting or restricting the EU's current raft of border controls. His assertions are a perverse invention, completely lacking in merit. There is nothing to support these claims and Lilley offers nothing to support them. And without so doing, Lilley cannot justifiably deny that the effect of the WTO option will be disastrous.

Here then, we come to the nub of the matter. What on earth is The Times doing in publishing these completely unsubstantiated claims, giving an obvious polemicist a free pass to promote damaging untruths?

We would not advocate censorship, but newspapers such as The Times and the media generally have a duty to the public not to mislead them or to allow others to do so. The assertions made represent a major failure in editorial judgement of a journal that was once regarded as the "newspaper of record".

In the Brexit debate, there is no stopping the likes of Lilley retailing his poisonous wares. Whether he is a liar or not is an academic (or theological) judgement, but there can be no doubt that he is devoting himself to spreading untruths. It is no part of the media's role to help him do it.



Richard North 15/08/2018 link

Brexit: information wars

Tuesday 14 August 2018  



BBC bias in news reporting seems to becoming something of an obsession with the left at the moment – especially amongst those with a "remainer" bent - where the coverage is said to favour the leavers.

Nick Cohen has been amongst those making his views known on the subject, turning to The New York Review of Books to air his complaints. He had, though, started on the theme a tad earlieron Twitter although, like so many self-important polemicists, he doesn't seem too keen to debate his findings with mere mortals.

Nevertheless, his intervention triggered a blogpost from me, where I argued that the perceived bias was more a function of the incompetence of BBC reporters, reflecting their inability to deal adequately with the issues raised by Brexit.

However, if you want the rock-like consistency of an unchanging narrative, then the legacy media is the place to go. In July, Cohen was rehearsing a theme that was already well-established the previous April. But, once developed, the media will keep revisiting it, like picking at a scab.

Yesterday, therefore, it was the turn of Patrick Howse, a former BBC journalist, writing in the New Statesman, addressing a core complaint in the litany of grief – the pursuit of "balance" by the corporation. Howse writes:
When you have people of goodwill and good intent discussing an issue from different sides, balance can be a useful tool: you tell both sides, and let the audience decide. It breaks down, though, when applied to people who have no interest in telling the truth, and who in fact set out to deliberately mislead. The result is a confused "he says this, but she says that" narrative that gives false equivalence to the truth and a pack of lies.
This was enough to provoke a response from Pete, reflecting precisely the views that I'd lodged in my earlier blogpost.

Essentially, although the left is keen to make this about "balance", it really is about competence - and the way journalists are taught to do research. When they are researching a story, they will rarely go to the original reference material but will tend to ring up their contacts and ask them what they think. If there are a variety of opinions, they will air those opinions, in the classic "he says, she says" format.

If the BBC had applied that methodology to, say, the 1944 Normandy Invasion, it would have been reporting Montgomery or Eisenhower saying "we are invading Europe", followed by an interview with Rommel saying, "this is not the invasion - it is a feint. We fully expect the main push across the Pas de Calais any day now".

A more responsible approach to finding out the truth on an issue would be to carry out independent research, relying on that original source material which the BBC so often avoids. Thus, if journalists want to know what is in the EEA Agreement, they should read the Agreement. They should not be ringing up law professors or other "experts" and asking them.

It is then perfectly acceptable to refer to experts for their interpretation of complex issues, once the factual baseline has been established. And, if there is genuine disagreement, this also can be (and often should be) reported. But any controversy should be an adjunct to a factual report, not the central part of it.

The trouble is that controversy makes for good copy and, where entertainment becomes part of the brief, an essential part of radio and television broadcasting. In this report - published four years ago but still just as relevant, we see something of how this works, when writer Alex Miller outlines his experience. "I once had a mate", he says:
… who worked on a radio show hosted by a high-profile journalist. They were hosting a phone-in about gay marriage. My friend – the researcher – had been asked to find one person who supported the concept and one person who was not in favour: as such they would represent the debate happening in streets blah blah blah. But, as the calls came in, they were all very positive. There were no fire and brimstone Catholics, no furious homophobes, no paranoid family rights campaigners – just a bunch of people who were perfectly happy for the gay community. My friend dispatched the good news to the producer and was quickly sent back to the phones where he spent the next 20 minutes dredging Britain's sewers until he found an available prick who would come on and claim that gay freaks were trying to steal marriage from the real humans. I'm sure it made for noisy radio, but if you'd listened to that show, the Britain you heard portrayed was an angry, polarised one, half the population of which spends its weekends nail-bombing bars in Vauxhall.
I've had this in the days when I was prepared to waste my time talking to the BBC. You would get a charming researcher ring you up and ask you whether you could talk about a particular subject. If you agreed, he (or she) would ring off with a promise to come back and confirm the details.

When they returned though, there would always be a little add-on at the end. "By the way", the research would say, "we've also invited so-and-so to come in to join in the discussion…". And it would always turn out that "so-and-so" would have diametrically opposing views and you'd just been suckered into a shouting match.

They did this once too often, pulled this stunt on me on the Jeremy Vine show, for a telephone interview. By that time, I was so fed up with their games that I let them book me and listened to them announce my name at the beginning of the programme. But when they called me for the interview spot, I left the answering machine on and didn't lift the 'phone.

Looking at the way this insistence on two-handed interviews is handled in the New Statesman article, we have Howse, the former BBC journalist, misdiagnose this as an attempt at "balance". It isn't. It is a perversion of journalism, which is seeking to turn news and current affairs into "entertainment".

Furthermore, Howse does not understand – any more than does Cohen - that this is a problem affecting all legacy media journalism. By and large, all media organs are obsessed with "biff-bam" adversarial news reporting, and present most of their coverage in this form.

As Pete remarks, when you think this through, this is the way we do our politics, so it is hardly surprising that the media should do political reporting the same way. In any report of a Commons debate or political event, we might hear that "the government says this", but it will then be followed by, "but the opposition says that". This then bleeds into all forms of reporting. At fault, therefore, is the fundamental structure of the way we do news (and politics).

This has a further and hugely corrosive effect on the way news is reported. When the delivery of information is engineered to come via the mouths of opposing spokesperson, facts cease to have any fixed quantum. They are what the rival spokespersons assert.

Then we have the other phenomenon about which I have written so much: prestige. In the hands of the media, facts are what people with prestige assert. Inevitably, the greater the prestige of the utterer, the greater the authority of the facts asserted. And where we have people of equal or equivalent prestige asserting different "facts", no attempt is made to reconcile the positions. To generate controversy is, after all, the objective of modern-day journalism.

What has now caused the ultimate collapse in reliable new reporting is that those who seek to influence the media now play the "prestige" game. To get heard, they must acquire or develop prestige.

All influencers play the game, exacerbating the problem. The battle becomes one of building the level of prestige to support one's preferred set of "facts", rather than in acquiring more and better evidence to support them. Prestige trumps evidence every time.

Illustrating precisely the media preference for adversarial reporting, we see the BBC responding to Cohen's complaints, only for him to turn round and accuse the BBC of failing to treat e-mails - regarded as "evidence of Russian involvement" in the Brexit campaign - as news.

Instead, Cohen charged, "it treated the emails as mere talking points, the excuse for a catfight, and for the BBC to play out another round in the culture wars. It invited Cadwalladr and Oakeshott to slug it out on the Today programme".

But that's how it treats all news. And that is how most of legacy media deals with news. Firstly, it will falsely create a binary scenario, where complex issues can be turned into a simplistic pastiche of contrasting ideas, and then it will get people to champion the opposing propositions. Nuances, which expose the artificiality of the narrative, are ignored.

It is in that trap that the debate on the management of Brexit has been caught, and then even the argument about how Brexit has been reported has been turned into a binary, adversarial "catfight" – the left versus the BBC. This is no more real than anything else reported by a media which has so badly degenerated that it can't even evaluate is own failures.



Richard North 14/08/2018 link

Brexit: the Dunkirk Option

Monday 13 August 2018  



According to Philip Davies, Conservative MP for Shipley, the only way Mrs May can survive as prime minister – and then only until the next general election – is to walk away from the Brexit negotiations "and start preparing properly for the fact that we're going to leave without a deal".

This is a measure of the stupidity of the man. While evidence of the dangers of the "no deal" scenario continues to accumulate, Davies and his fellow "Ultras" continue with their delusions, impervious to the reality which is all too evident to anyone with eyes to see.

It is doubtless true that, by opting for a "no deal" exit, Mrs May would enjoy a brief spell of popularity with a section of her party and the "kipper" tendency. But that would be short-lived. It would last just as long as it would take for the effects to become apparent.

With that, the Conservative Party should expect electoral annihilation. Even against Corbyn – should be not be deposed by his own members – the Tories would struggle to win. Received wisdom suggests that they would be out of office for a generation.

One supposes that, with this as a prospect, wiser heads within the May administration will prevail. An attempt will be made to secure a deal with Brussels, on whatever terms can be agreed. But these terms are not going to be favourable, creating their own stresses within the Conservative Party.

Either way, this is a lose-lose situation for Mrs May. But, in terms of short-term survival, Davies is probably right. Going for a "no deal" exist is probably the only way the prime minister will survive to the next election. But even then, she will need to act quickly. The forces of opposition are mounting.

From the likes of the Daily Mail, for instance, we see reports of dark conspiracies, the latest being a "secret plot" to oust Mrs May, and install David Davis as an interim prime minister – with the oaf Johnson waiting in the wings, ready to take over once we have left the EU.

Whether Johnson really has enough support to take over leadership of the Conservative Party is difficult to judge. There is a certain madness abroad at this time which is infecting the minds of men, obscuring the fact that this crass man at the helm of the party would be electoral suicide. Even if he did secure the leadership, he would never bring the Conservatives to electoral victory.

Politically, this leaves the UK in an interesting position. If Mrs May attempts to do the right thing, she will almost certainly be deposed. If she or her successor implements a "no deal" exit, that will ensure that neither of them remain in office. As such, Brexit represents an existential threat to the Conservative Party.

Despite the wishful thinking of those in continuity remain, seeking to stay in the EU – revoking the Article 50 notification – isn't an answer either. Not only are the "colleagues" unlikely to want us back, a serious attempt by a Conservative government to remain in the EU would precipitate an unreconcilable split which would also keep it out of office for a generation.

On the face of it, therefore, we seem to be looking at a problem to which there is no solution – not in the current political environment. The media have lost the plot, most of the expert groups are compromised when it comes to devising solutions, and industry representatives are not in a position to proffer anything which is politically sensitive.

Given this situation, and the enthusiasm for inventing new, named "options" to supplement the Efta/EEA, Swiss and WTO options, perhaps we ought to recognise the disaster scenario, to which we seem to be heading, by giving it its own name.

Both Pete and this blog has referred to Dunkirk (as in the evacuation of the BEF in 1940), whence I have remarked that we need a real, full-blooded disaster on the scale of Dunkirk or the loss of Singapore to the Japanese before we can get to grips with what is needed.

If such a disaster is needed to create the political environment in which change can be proposed and accepted, then we need to stop beating about the bush and start planning for disaster in what we might call the "Dunkirk Option", going for this as a deliberate choice. 

Oddly enough, the end result of the Dunkirk Option would look very much like the Swiss Option, with a succession of bilateral agreements made with the EU over a prolonged period, the totality amounting to the single treaty that we will have failed to secure.

The great danger of this – apart from the obvious economic damage – it that it cedes the initiative to the EU. In a crisis situation, we will be pressing for the deal(s), and the EU will usually be in a better position, able to bide its time.

However, there is no point in seeking an alternative if the political will is not there. Creating the conditions where the parties can come together to make an agreement is often as important (and sometimes more so) that the substance of the agreement itself.

The great handicap under which we labour at the moment is that not enough people understand, or are prepared to accept, quite how damaging a "no deal" scenario will be, and we are running out of time to convince the majority of the perils they face.

As late as yesterday we saw a senior meat industry representative (and former colleague), blithely assert that the post-Brexit beef industry "will be trading with the EU on the same basis as we are now". And even where there is some recognition that problems lie ahead, there is often a lack of understanding of their nature or severity.

In short, many people lack the imagination, the experience or the understanding that will enable them to visualise for themselves what the consequences of a "no deal" might be. Thus, they must actually go through the experience before they will accept the need for countermeasures.

Looking at the bigger picture, we need not assume that the EU would necessarily reject the crisis management approach embodied in the Dunkirk Option. After all, it was Juncker who said of the 2008 financial crisis, "we all know what things need to be done. What none of us know is how to get re-elected after we've done them".

In the main, we are dealing with mature, experienced politicians who will fully understand that there is often a gulf between defining what needs to be done and getting the backing needed for implementation.

Clearly, a politically enfeebled Mrs May lacks the political support needed for the implementation of a rational Brexit solution. Any new leader will need help if they are to achieve anything useful. And, if nothing else, continental politicians are fully aware of the concept of the beneficial crisis.

Another aspect of the bigger picture is the need to remember that Brexit is not an event but a process. Crashing out on day one may be disastrous in the short-term, but it doesn't have to be the last word. If we can absorb the damage and come back for further developments, then we can still end up where we wanted to be, albeit incrementally over a longer time period.

In fact, looking for a "big bang" solution was probably never on the cards. Governments simply do not have the absorptive capacity to deal with multiple, complex policy changes in such a short period as a couple of years. They need the flexibility to deal with issues sequentially, one at a time, without overloading the system.

This makes the prospect of a prolonged transitional period by far the most attractive option. But if there is no political support for the idea, then there is no point in hankering after something which is unattainable. If we need a crisis to clear the rubbish out of the system and create the political space for a workable solution, then we have to factor in the crisis as part of the process.

It thus seems to me that the best way out of the current impasse is to allow a crisis to develop, and manage it as best we can to minimise the damage, while using the political space created to pursue a longer-term objective.

Such a strategy may be considered very far from optimal, although in the real world, the politically attainable must always take precedence over the unattainable ideal. Pragmatism must be the watchword. If we need a crisis in order to achieve long-term goals, then that must be considered as part of the price we must pay for a sustainable, long-term solution.



Richard North 13/08/2018 link

Brexit: a matter of respect

Sunday 12 August 2018  



"Being a defender of Brexit is no fun these days. The Brexit camp can loosely be divided into two categories. The devious manipulators and the gullible followers. There is now a growing army of EEA Brexiters and we are gradually winning the argument against no deal, but the core of Tory influenced Brexit is still setting the agenda".

So writes Pete in his latest blogpost headed: "Yes, Brexit IS worth it". But he's right: it isn't fun. The sheer labour of dealing with the monstrous propaganda of the "ultras" takes its toll, and one tires of having constantly to repeat the same arguments to unyielding minds.

To make any real progress, it seems to me that we must have the legacy media and the bulk of politicians united in pointing out the dangers of the "no deal" scenario, making it absolutely clear that this is not a credible option.

However, as long as Mrs May occupies No 10, and maintains her stance that "no deal is better than a bad deal", we are facing an impossible struggle. Ostensibly, the only remedy is her resignation or removal – except that her replacement could be far worse.

Nor indeed is a general election an answer. Given the incoherence of the Labour stance and the untrustworthiness of Corbyn, we could hardly predict how a new government would behave – assuming that Labour could win, which is by no means certain.

This leaves us in a weird no-man's land where we end up getting shot at from both sides and the only option is to keep your head down and wait until it is all over. And, on present form, it will be "over" when we drop out of the EU without a deal, whence we have to start dealing with the realities of the damage that this will cause.

Meanwhile, it's open season for speculation, compounded by the "silly season" effect where the media will fill is space with derivative material that merges together to create a low drone of incomprehensible noise. Where no one really knows what is going on, and where the convoluted statements coming out of Downing Street so lack any intellectual coherence, anything goes.

Inevitably, that makes for a certain predictability to the media coverage. Rehearsing a "safe" narrative (safe, because it exhibits bovine conformity with previous article), we have the Sunday Times titillate us with the horror prospect of a 12 percent hike in food bills.

The paper gets the obliging chairman of "one leading supermarket chain" – who is allowed to remain anonymous – to warn that food products imported from the EU would be hit with an average tariff of 22 percent, thereby ignoring the fact that we are taking over some of the EU's tariff-free quotas.

Without a trade deal for goods, we are told, the UK would fall back on World Trade Organisation rules. Britain would trade with the EU under the WTO's "most favoured nation" status, but this would imply significant tariffs on many foods.

This is Brexit 101 stuff, but no newspaper is going to push the boat out and explore the issues in an intelligent fashion. Instead, we are enjoined to accept that this "is only one of three ways in which a no-deal Brexit would push up prices".

Additionally, Sterling will fall further, raising the cost of imports – which is possibly true. The working assumption in Whitehall is that it would drop by ten percent or more. Then we are regaled with the idea that prices would also be pushed up by supermarkets being forced to import food using different ports and longer routes to avoid congestion at Dover.

You can easily see why this blog is so consistently avoided. With our talk of mitigation and complex effect on trade patterns, our analyses are about as welcome as the proverbial pork chop at a Jewish wedding.

Given even a half-sentient analysis, one would never get away with the narrative on offer from the Sunday Times and its anonymous chairman. He tells us, "It's complete nonsense that Brexit supporters say we could, without any damage, go to WTO most favoured nation tariffs".

According to this source: "It's dreadful. There will be hold-ups at the border and that will make it impossible to take things out of the ground in Spain this morning and get them onto the shelves in two days' time". He adds: "This is so serious we're talking about civil unrest on the streets. Within two weeks of no deal this will become a very different country".

Yet it never seems to occur to anyone that the enormity of this, and its very predictability, means that even our dismally incompetent government cannot allow it to happen. And we have sketched a scenario where the worst effects of a "no deal" on the food supply can be relatively easily avoided.

Newspapers being newspapers, though, not only must they keep their readers ill-informed, they must slavishly adhere to the "he says, she says" formula that drives all contemporary reporting. With one person saying it's going to be a disaster, we must have a counter-view saying it won't be.

Selected for this role: is Malcolm Walker, founder and boss of Iceland. Helpfully, he has disputed the latest warnings from the food industry, saying: "All this scaremongering ... about stockpiling food - personally I think it's all bollocks. It's not in the EU's interests for there to be no deal".

Actually, I suppose that we should be grateful for any attempt by a newspaper to bring home the consequences of a "no deal", but since all we're getting is a litany of conflicting opinion, without the backing of research and analysis, the average reader is no better off. You can draw from the report any message that you want to believe.

The same lack of research is evident in a self-important piece from David Smith, economics editor of the Sunday Times. Displaying two further vices of the legacy media – the undue deference to "prestige" and the over-reliance on the oral culture - he asserts that a "no-deal Brexit" is "the silliest of silly ideas".

Smith addresses the argument put forward by the "ultras" that the WTO agreements on sanitary and phytosanitary measures and on technical barriers to trade would ensure that the EU will have to stay open to British exports even in the event of a no-deal.

But, to make his argument, he is impelled to rely on Emily Lydgate, Peter Holmes and Michael Gasiorek of "the respected UK Trade Policy Observatory". Just where would the average hack be without all these "respected" institutions"?

Anyhow, this pair make the obvious comment that such claims are mistaken and show "a lack of understanding of the WTO rules". It seems though that one must be "respected" before one's comments are aired in the media. But at least we get to the point that WTO rules "impose an obligation to talk - but ultimately it is down to the importing country to determine whether the regulation meets its standards".

For the UK, the issue is not whether or not the goods are produced to the same standard on Monday or Friday. On Monday the UK does not need to prove this, on Friday "it may have to". And this would be WTO compatible. Even if the UK challenged the EU at the WTO, the process would take years - and would be unlikely to succeed.

Thus some points are at last getting through, even if the lack of detailed knowledge really does show - prestige will only get you so far. When it comes to food and EU law, I am a qualified environmental health officer (now retired) and have been immersed in EU food law for over 30 years. I have been a port health inspector and, as blog readers will know, I have made this area my speciality for as long as this blog has existed – for 14 years now.

This, clearly, does not qualify for "respect" in media circles, especially as I never tire of pointing out that, in where foods of animal origin are involved, there is no question of the UK having to prove conformity with EU standards. Until the UK is listed as an approved exporter, our exports will not be allowed entry.

Similarly, medicines carrying a market authorisation held by a UK company – although most certainly conforming with UK standards – will not be allowed entry. The same goes for vehicles and their parts, to chemicals and to aviation The need to demonstrate regulatory conformity is only a small part of the overall picture.

Nevertheless, Smith gives an outing to another "respected" figure – and rightly so. This is Malcolm Barr of JP Morgan – an avid reader of this blog.

Barr is allowed to say that, "By now it might have been thought that an informed consensus would have developed such that 'no deal is better than a bad deal' was recognised as political bluster. As tribal as Brexit has become, the implications of 'no deal' are not simply an issue of ‘remain’ versus 'leave'. One can be pro-Brexit while regarding ‘no deal’ as potentially disastrous".

This comment is based on a public domain circular produced by Barr and he would be the first to acknowledge that his sentiments are not unique. But he is a "respected" figure and thus gets quoted. For once, though, knowledge accompanies prestige, but that is not always necessary in this game. "Respect" is everything and will always trump mere knowledge.

But slowly, the message is getting though. Even the BBC is having a stab at setting out the consequences of a "no deal" and has managed to get some of the points right. A highly derivative piece in Money Week makes some of the same points.

These points won't have the slightest effect on the "ultras" though – the WTO option advocates are in the propaganda game and are not bothered about inconvenient things like facts. Whether Mrs May can be induced to change her mind – or is already in the process of so doing – is another matter. Perhaps she needs someone she respects to tell her which side is up.



Richard North 12/08/2018 link

Brexit: new possibilities beckon

Saturday 11 August 2018  



We started off this campaign more years ago than I care to remember with three basic options. There was the WTO Option, which was never a starter. Then there was the Swiss Option, favourite of the likes of Dan Hannan, and then there was the so-called Norway Option.

The Norway Option became our preferred option not by a process of selection but by one of elimination. Having ruled out the WTO option for very obvious reasons, the reservations applying to the Swiss Option were so great that this too was ruled out. This left only one standing.

Since that time, and with increasing intensity after the referendum, we find ourselves rehearsing the same arguments, plus having to take on sundry other variations invented by attention-seeking clever-dicks.

But basically, options remain the same, whatever names you give them. There is the unilateral option – aka WTO option or "no deal" scenario. Then there is the bilateral option. You can call it the Swiss Option, or a CETA variant, or anything else you like. But they all amount to the same thing – a bespoke agreement between the UK and the EU.

Then there is the multilateral option – joining an arrangement settled by other countries and already in operation. The only working example of this is the Efta/EEA option, still called the "Norway Option" by many.

Currently, we're having to struggle with the extended stupidity of the "Ultras" embracing the "WTO Option", while there is some renewed interest in the Efta/EEA Option, the effect of which is to shunt the Swiss Option into the background, where it lingers in relative obscurity – occasionally promoted by its original advocates such as Hannan.

However, while we are preoccupied with Brexit, life goes on. And it may come as a surprise that we're not the only ones negotiating a treaty with the EU. Switzerland has been back in the fray, discussing new arrangements to update their existing treaty arrangements.

The plan was to tidy up the messy group of a hundred or so separate treaties, talks on which have been going on for some considerable time. And, at the end of June, the Swiss government was deciding whether there had been enough progress to settle a political deal that would lead to a brand new treaty.

The intention that it should be signed in 2019, the same year that the UK was due to leave the EU with its own withdrawal agreement. Any deal would then be put to a binding referendum, allowing the Swiss people to decide their own future.

Amongst the key issues on the table is conflict resolution, with the EU finally losing patience the separate arrangements and wanting the ECJ to act as the main arbitrator in settling legal disputes. The use of "foreign judges", however, was likely to be a no-go area for the Swiss People’s Party (SVP), giving them a political edge in the 2019 federal elections.

This had caused Juncker to come up with a different proposal for independent arbitration panels which had gone some way to defusing Swiss concerns. But another contentious area was the provision by the Swiss government of state aid, which the EU wanted stopped.

The most contentious issue though was the Swiss system of "flanking measures" – steps adopted in 2004 to prevent foreign workers on temporary assignments in Switzerland (the so-called posted workers) to undercut local wages and conditions. To date, the Swiss government has declared this a no-go area for the talks.

It has come as no great surprise, therefore, to see a report that talks have broken down and that a new EU-Swiss treaty is as "dead as [a] doornail".

The "killer" has been an alliance between the normally pro-EU centre-left Social Democrats (SP) and the SVP, united behind Swiss labour unions in saying that the deal would undermine wages and working conditions. Officially talks are on hold, with a new round of negotiations planned after the summer break, but no one is optimistic that progress is likely.

There are now fears that the failure of the talks will precipitate a a new diplomatic ice age, prompting the EU to take punitive steps against the Swiss. The Commission, for instance, has indicated that it may not renew Swiss equity traders access to the EU Member State markets beyond 2018.

Where this gets really interesting is in the observation that Brexit has made it more difficult for the EU to make concessions. But it puts the Swiss government in a confrontational position, potentially making it an ally of the UK. There must certainly be a commonality of interest sufficient to allow tentative discussions between the UK and Swiss governments.

Given the recent history or relations between the EU and Swiss, where immigration has become a serious bone of contention, it is arguable that one of the biggest mistakes the Swiss people made was in rejecting membership of the EEA. After all, the initial use of Art 112 of the EEA Agreement was a joint affair by Switzerland and Liechtenstein.

Had Switzerland remained in the EEA, it too could have sought a sectoral agreement with the EEA which would have given it a permanent right to control immigration. And if the posted workers issue became a problem, the Swiss government could just as easily invoke safeguard measures.

On that basis, rather than even considering the Swiss Option as a way of settling Brexit, the UK might be better advised to seek an alliance with the Swiss, bringing it back into the EEA fold, and supporting UK entry into Efta, with a commitment to jointly resolving immigration issues through the medium of the EEA Agreement.

With the UK on its own, negotiations were always going to be difficult so the possibility of securing a like-minded ally is something the UK should take very seriously indeed.

And this is where there is a considerable lack of imagination on the part of Mrs May and her government. The UK is by no means alone in having reservations on the application of freedom of movement. And concerns about the brain drain from Eastern Europe gives us common cause with Bulgaria, the Czech Republic, Hungary, Poland, Romania and the Slovak Republic.

Another issue here are financial payments made by Efta/EEA states, particularly those made by Norway in the form of Norway/EEA grants. Wrongly treated as contributions to the EU budget by some pundits, payments are made directly by the donor countries to the recipients, on projects which they themselves approve.

There is some suggestion that the UK within the Efta/EEA nexus could allocate funds from the aid budget and, in retaining control over their disbursement, is in a position to use grants as leverage, to secure political advantage.

In short, the UK has significant opportunities to pursue migration policies which are more to its liking, bearing in mind that it is unlikely that we will be seeking major reductions in workers coming from EU/EEA members. The essential point is that the UK government should be seen to be in control.

The central problem here, therefore, is not so much the lack of opportunity but the refusal of Mrs May to step outside her own, self-imposed limitations. If she could break her obsession with the discredited Chequers/White Paper plan and look at the issues in the round, new possibilities beckon.

Similarly – but possibily even less likely – if the media could break away from its love affair with trivia and look seriously at the alternatives, we could perhaps start having a debate about real possibilities instead of their hothouse fantasies.

For the moment, though, the national media have been virtually silent on the Swiss situation and constantly misrepresent the Efta/EEA option. Almost without exception, any reference to our continued participation in the EEA Agreement includes the claim that we would still have to accept freedom of movement.

Nothing, it seems, can survive the venality of a media determined to get it wrong and where their disinformation reinforces the ignorance of the politicians there can be little hope of any progress. Possibilities there may be – but they remain invisible.



Richard North 11/08/2018 link

Brexit: recycling a bad idea

Friday 10 August 2018  



When the Centre for European Reform (CER) came up with what they called their "Jersey Option" - the brainchild of John Springford and former Friends of the Earth activist Sam Lowe – I thought it so self-evidently mad that I didn't even bother to review it.

Without offering much detail (and the devil is always in the detail), with this "magic mushroom" option, the pair would have the UK agreeing a customs union with the EU and accepting the Single Market regulations on goods, while rejecting rules on services and freedom of movement.

This was picked up by the "usual suspects", including Philippe Legrain of the London School of Economics, and it was given a good airing by the Financial Times. Apart from that, though, it got very little traction in the general legacy media.

But, in the run-up to the now-notorious Chequers cabinet meeting, even the Financial Times had given up on the idea, the summary execution being delivered in a piece by Alan Beattie, headed: "The 'Jersey option' looks good for Brexit Britain. It isn't".

Beattie noted that, "if the frenzied speculation is true, this week's special UK cabinet meeting will end with Britain asking for a customs union with the EU plus accepting its regulation of goods, while rejecting single market rules on services and freedom of movement".

This model, he wrote, is generally called the "Jersey option" after the British crown dependency in the English Channel, which already has such a relationship with the EU.

Analysing the prospects, he concluded that, the option "may look cosy and inviting, but pull a thread and it begins to unravel". Apart from anything else, he argued, if the UK gets it, quite a few other EU member states might be wanting one too.

Part of the reason France is such a fierce opponent of the Jersey model, he continued, is almost certainly that its leaders fear the domestic reaction. French voters may wonder whether they too can also have a deal whereby they continue to export champagne, Renault cars and Louis Vuitton bags to the rest of the EU while not having to take in Polish plumbers or Romanian builders.

Nevertheless, this did not stop a breathless Sam Lowe, on 2 July, issuing his own press release, confining it to just the few lines of the FT which had predicted that the cabinet meeting would go for his model – without repeating any of the demolition.

Sadly for Mr Lowe's personal ambitions, it was not to be. Not even the cabinet was rash enough to go for something so obviously mad – not that it could ever have been politically conceivable. Had Mrs May then conceded to staying in the customs union, abandoning one of her strongest "red lines", it is probable that, by now, she would no longer be prime minister.

The one thing you have to give the legacy media, though, it that it will never let a bad idea go to waste. Over a month after Mr Lowe's madness had been given a decent burial, it now transpires that the all-important stake through the heart has been omitted.

Thus, up pops The Times, with a piece bearing the by-line of the three musketeers, Oliver Wright, Dominic Walsh and Bruno Waterfield, hidden in the business section under the headline: "Sterling slumps to new low as fears grow of no Brexit deal".

Pomposity abounds as the newspaper self-importantly intones that "The Times has learnt", leading into the claim that "European leaders are preparing to negotiate a deal that would let Britain remain in the single market for goods while opting out of free movement of people".

As with all such stories, there are no named sources - we are required to accept that this comes from "sources at the highest level of Brexit negotiations", an interesting formula which does not exclude British informants.

The meat of the claim is that Member States "have let it be known that they could abandon one of the bloc's ideological red lines in return for more Brexit concessions from Theresa May". We are told that they expect her to replicate all new EU environmental, social and customs rules in addition to those set out in the Chequers white paper. And for that, there is the "potential trade-off", amounting to releasing the UK from freedom of movement provision.

All this is to be discussed at what is described as "a special meeting of all 28 leaders in Salzburg next month". The framing is a little disingenuous as one might infer that the meeting had been called to deal with this matter. In fact, this is a long-standing informal meeting of the European Council, where the main topic on the agenda is to be "security and the fight against illegal migration".

Ironically, as recently as yesterday, the Express was venting its outrage with the headline: "Row erupts as stalling EU says it might NOT discuss UK deal next month".

Downing Street, this source claims, insists Austrian leader Sebastian Kurz, who is hosting the meeting, has agreed for Brexit to be at the top of the agenda. But no such message has been heard from Austria, and Donald Tusk remains undecided. Meanwhile, an EU ambassador has said leaders would be unimpressed if the Prime Minister fails to present a fresh idea to the table.

That clearly has opened the way for The Times to peddle its story, where it appears that the "Jersey Option" label has been planted by British officials, with a senior EU source then saying: "If May came with the Jersey model there would be a serious discussion among leaders for the first time". Deconstructing the story, therefore, in the words used by The Times, "European leaders would listen if Mrs May adopted the Jersey model wholesale".

Thus, the entire report rests on one speculative idea, amounting to the premise that "European leaders would listen if Mrs May adopted the Jersey model wholesale, based on the response of an anonymous "senior EU source" when asked to guess how the European Council would react.

There is nothing at all to suggest, much less substantiate a claim that Mrs May intends to propose adopting the "Jersey Option", and nothing at all to indicate that the EU-27 would be prepared to do anything more than listen. We are, dear readers, looking at a silly season filler, invented by its own creative authors.

Oddly enough, with The Times having buried its own story in the business section under a non-descriptive headline. It then offers a leader asserting that: "EU leaders are starting to show some belated but flawed flexibility on Brexit".

Referring to its own report and stretching it beyond breaking point, it claims that the European Union "is looking for three new concessions from Mrs May".

First, it says, she would have to ditch her customs plan in favour of a full-blown customs union. Second, she would have to commit to swallowing EU rules on labour and the environment to reassure Brussels that Britain would never engage in a "race to the bottom". Finally, she would have to abandon the idea of diverging on goods regulations where they are not directly relevant to border checks, such as rules on food labelling.

Then, even the leader-writer allows a chink of reality to creep in. "Given the politics of Brexit, and the fact that two senior ministers resigned over Chequers", the scribe intones, "this looks a forlorn task".

However, with the silly season in full flow and the rest of the media struggling to find something to publish, the leader was enough to ramp up the Mail into delivering the headline: "Brussels 'prepares a Brexit climbdown and is set to agree the UK can stay in the EU single market for goods without having to accept free movement'".

With no other source than The Times, coprophagia is rampant as multiple other papers recycle the story. The only addition of substance that the Telegraph could manage was that: "The European Commission declined to comment on the plan, but did not deny that member states 'may be discussing it'".

But there is one national paper that most definitely is not indulging in the coprophagic feast. This is the Guardian, offering an editorial that sternly advises us that it is "time to make real choices". There are only three outcomes now, it says: "No deal is one of them. A Norway-type compromise is the second. And the reversal of Brexit is the third".

They get there eventually.



Richard North 10/08/2018 link

Brexit: you can't even fool Tories all of the time

Thursday 9 August 2018  



The Twittersphere is all agog with Mrs May's latest charm offensive, trying to sell her Chequers plan to her party faithful. Published by Conservative Councillor Phil King, deputy leader of Harborough District, so far it boasts exactly zero "likes" and a similar number of retweets.

At least Conservative Home have given it an airing and the Guardian is on the case, using Cllr King's helpful publication.

Meanwhile, it takes no great genius to work out what really excites the legacy media and the social media. The oaf's genius for self-publicity has got him the headlines and the attention he so desperately craves.

That said, it is not easy to get worked up about Mrs May's latest contribution to the debate. We've been there before, and she has very little new to say. Even the mantras are the same.

Our revered prime minister starts by telling the faithful – just in case they needed reminding, that in the referendum on 23 June 2016 – the largest ever democratic exercise in the United Kingdom – the British people voted to leave the European Union.

"And that", she says, "is what we will do", adding the now-familiar litany: "We will take back control of our money, laws, and borders". All this, she declares, begins "a new exciting chapter in our nation's history".

But Mrs May, having acquired a reputation for not listening to anyone outside her own tiny inner circle, now has it that "it now falls to us all to write that chapter". And that is why, over the last two years, she has travelled up and down the country listening to views from all four nations of our United Kingdom and every side of the debate.

I don't know if she has read these words – words which she has put her name to – but she set in stone her Brexit policy on 17 January 2017, when she committed the UK to leaving the Single Market. And she hasn't altered her position one iota. If she's been listening to views from "every side of the debate", she has a funny way of showing it.

I need not then trouble you with the platitudes about making "this great country … fairer and more prosperous than ever before", which means we can cut to the chase and learn how the Government is delivering on the result of the referendum, and the pledges made at the general election, to leave the EU and build a strong new relationship with the EU from outside.

Startlingly, though, she admits that "our negotiations on our future relationship have reached an impasse" and that the two options on offer from the EU at the moment "are not acceptable to me, or to the United Kingdom".

The first is a standard free trade agreement for Great Britain – with Northern Ireland staying in the customs union and parts of the single market. This "would break up the UK" and, as a proud Unionist, Mrs May is "very clear" that it would be "unacceptable".

The second, membership of the customs union plus an extended version of the European Economic Area (EEA), would mean free movement, vast annual payments and alignment with EU rules across the whole of our economy. This, says Mrs May, "would not be consistent with the referendum result".

While remaining "clear" that "no deal is better than a bad deal" – to which effect the Government is stepping up its "no deal" preparations, Mrs May avers that the "best path to delivering Brexit" is to "get the EU to consider a third option".

I suppose we can be grateful that she did not – in the manner of Tony Blair – call it the third way, but nonetheless that is what the White Paper has become. It "honours the result of the referendum, maintains the constitutional and economic integrity of our United Kingdom, and sets us on course for a productive relationship with our closest trading partners".

The need to preserve my own sanity prevents me from then delivering verbatim what Mrs May then has to say - for the reason that we've heard it so many times already. If I hear it once more, my head will explode.

Suffice to say that her "plan" is in no sense a concession to the EU's "demands". She is rejecting the two models they have put forward. Instead, "we are asking them to accept a bespoke model which meets the unique requirements of the United Kingdom", she says. And a "key part" of that bespoke model:
… is the creation of a free trade area on goods between the UK and the EU. This would protect the uniquely integrated supply chains and ‘just-in-time’ processes which have developed over the last 40 years, and the jobs and livelihoods dependent on them. It would ensure that businesses on both sides can continue operating through their current value and supply chains. It would avoid the need for customs and regulatory checks at the border, and mean that businesses would not need to complete costly customs declarations. And it would enable products to undergo only one set of approvals and authorisations in either market, before being sold in both.
There is more – there always is. But, with that, Mrs May has just buried us. Actually, it's more in the sense of a traditional burial where the earth in the plot is left to settle for a year before the headstone is positioned. That's what she's done: she's set the headstone.

Just for once, it would be such a relief for our prime minister to acknowledge that, when we leave the EU, we become a third country – with all that that entails. This is not a status reserved for the "no deal" scenario. It happens automatically, meaning that barriers already in existence and applying to all third countries will apply to us.

Mrs May holds that her proposals for partial adoption of the "common rulebook" will bring us frictionless trade at the border. But they won't. They can't and the EU has already rejected them. Yet the Conservative Party is supposed to be stupid enough to buy into something that the "colleagues" have already kicked into touch. Even some Conservatives will be offended by this.

Given the evidence that Mrs May is not taking a blind bit of notice of the Party, they may be further offended by the affirmation that she and the Party Chairman, Brandon Lewis, "are always keen to hear the views of Party members. Questions or comments are thus invited".

Even Conservative Home finds that hard to swallow. Responses received from correspondence already exchanged between members and the centre "have been universally bland", often simply copying and pasting arguments that have already been sent out as press releases and mass emails.

As you can imagine, says CH, "getting such a discourteous reply from Downing Street or from one's own Party is frustrating or even insulting for committed Conservatives who are seeking to express their deep concern about what they believe to be a serious error".

But members, doubtless, are expected to rise above all that. "As Conservatives", Mrs May says, "we should be proud of the role we are playing at this crucial time for our country. We are the Party which gave the British people their say in how they are governed. We are the Party which respects the decision they made. We are the Party which will take the UK out of the European Union next March".

And therein is the ultimate lie. "We are the Party", she says, "which will secure a strong, secure, and prosperous future for the United Kingdom as an independent country standing tall in the world while maintaining a deep and friendly relationship with our closest neighbours".

Conservatives anxious for a repeat dose are then given access to a propaganda sheet on the Party's website. This is just as well as you would have to be a Conservative member to be stupid enough to believe it – and even then, that's pushing it.

There is that saying with which we are all familiar:" you can fool all of the people some of the time …". But this variation ends, "you can't even fool Conservatives all of the time".

It is hard to imagine what Mrs May is even thinking about. Even if she could fool her party members, she can't fool Brussels. And that is going to have a far more profound effect on her life (and ours).



Richard North 09/08/2018 link

Brexit: the "no deal" penalty

Wednesday 8 August 2018  



With the prospect of a "no deal" exit from the EU being taken more seriously, we are starting to see a number of newspapers attempting to predict what the UK would look like in the event of us "crashing out" of the EU.

With the best will in the world, though, there are too many variables to anticipate, which remove any certainty. The precise outcome will depend on the assumptions made, the degree to which known factors are accounted for, and then the mitigation - both pre-emptive and reactive – undertaken by government, business and even individuals.

As far as variables go, there is probably no more volatile a situation than our food supply, with the more lurid commentators suggesting that we could run out of food within days (or certainly weeks), with the very real prospect of rationing to avoid starvation.

Yet, in this one area, mitigation is a practical proposition. Furthermore, given the destructive effect food shortages would have on the maintenance of law and order – with food riots, looting and civil disobedience – it is my view that the government would take any and every effective measure it could to ensure that food supplies are maintained (even if costs of some commodities do increase).

Largely, as we see from this article in the Telegraph - where James Rothwell writes a rather lame "explainer" headed: "What does a 'no deal Brexit' mean - and how would it affect the daily life of Britons?" – the media doesn't have a clue.

Here, Rothwell actually errs on the side of suggesting rather vague "magic wand" solutions, having noted that Mrs May says voters "should feel reassured", as the government plans to stockpile food.

On the basis that the government is set to hire an extra 1,000 customs officers to deal with extra checks, he argues that, "if large numbers of staff are hired, alternative supply chains are put in place and any outstanding legal issues are addressed - all in time for March 2019 - then the adverse effects could be mitigated".

However, no one with any sense is going to accept that the government (or even commercial enterprises) will be able to stockpile food, other than for a few very basic commodities. And nor is rationing a workable idea. There simply isn't time to set up a scheme, and nor would it be possible – barring the imposition of draconian emergency powers – to exercise sufficient control over the food chain to make it work.

Furthermore, no amount of UK border staff are going to make any difference. As I have pointed out so many times – latterly endorsed by the Road Haulage Association – the problems will arise in the continental ports, over which we have no direct control.

Looking at possible scenarios – which is not at all difficult, as we know most of the operating parameters and how they will be affected by Brexit – we can be fairly well assured that, if we control (i.e., limit) the amount of goods presented to ports for clearance in EU Member States, then the flow of imported food will be unaffected. Health checks in the UK can be waived (temporarily at least), invoking the WTO national security exemption (Article XX1 (b)(iii)).

The price we will have to pay for this is a massive reduction of goods exported to EU Member States – which may be to an extent mitigated by stockpiling goods on the continent (and in non-EU states) to keep customers supplied after Brexit.

But bearing in mind that the export of live animals and products of animal origin to EU Member States will be prohibited in the event of a "no deal" Brexit, we can expect a glut of certain commodities as they find their way onto the domestic market, and even a price crash. This dynamic will, however, drive many producers out of business, leading to shortages in the longer term.

If there is any likelihood of food shortages, the most probable cause will be panic buying. This has the capability of stripping supermarket shelves bare, even when there are no actual shortages. The government may need to impose emergency limits on the amounts of specific commodities any one individual can buy, and even make hoarding them a criminal offence.

In the absence of government action, the supermarkets may voluntarily impose their own limits, which could have the effect of damping down demand.

There is then the matter of medicines, where some pundits are also suggesting that shortages may occur. In this sector, though, stockpiling is a realistic proposition. Perversely, EU Member States are at greater risk, as medicines produced under the control of UK establishments (even if they are manufactured in EU Member States) may not be authorised for sale in any of the EU states.

Of all the headline issues that may become apparent, post Brexit, is aviation. Once we drop out of European Common Aviation Area (ECAA) and the aviation safety acquis, administered by EASA, the effects on UK aviation will be widespread and profound.

Rothwell, for the Telegraph relies on the view of chancellor Philip Hammond, who said: "It is theoretically conceivable in a no-deal scenario that there will be no air traffic moving between the UK and EU on 29 March 2019. But I don't think anybody seriously believes that is where we will get to".

For my part, it is extremely difficult to see how the legal issues in civil aviation can be resolved without intensive negotiations and a complex raft of agreements. In the event of a "no deal" Brexit, therefore, some disruption is inevitable and the odds favour a complete shut-down, even if only for a matter of days while emergency agreements are stitched together – allowing limited UK services.

The approach to aviation, however, typifies the way many pundits handle a "no deal" Brexit. Many of the consequences are so extreme that disbelief sets in. As with Hammond, the view is taken that because they are so extreme, they cannot be allowed to happen and therefore, that they won't happen.

Nevertheless, I think we must prepare for the likelihood that the export of motor vehicles will cease. Even where manufacturers have been able to transfer type approvals to EU Member State regulators, production supervision arrangements will not be in place, rendering existing approvals invalid.

The same goes for any civil aviation products, including finished aircraft and assemblies such as Airbus wings and aircraft engines. One cannot simply offshore the regulatory approval here, because controls are embedded right throughout the design and manufacturing processes.

Across the board, the export of many manufactured goods will cease. This will apply where they require third party certification from "notified bodies" and have relied on certificates from UK bodies. These will no longer be valid. Chemicals which lack REACH approval will also be excluded from the European market.

Live animal export will, of course, be prohibited, but this will probably also apply to the movement of pet animals without quarantine, and the transport of racehorses direct to France and Ireland, without veterinary control and supervision. Also on the sporting front, Formula 1 racing will be badly affected.

Recently, we have learned that a substantial amount of recyclable domestic refuse is exported to EU Member States, particularly Poland. This will no longer be possible.

Once we get into this sort of detail though, the legacy media is nowhere to be seen. Their journalists lack the capability (or the motivation) to offer anything other than the most superficial of pictures.

The closest I've seen recently is oddly enough in the The Telegraph, where Jeremy Warner reports under the heading: "Let's be honest about a no-deal Brexit; it has nothing to offer but blood, toil, sweat and tears".

Denying that there problems related to a "no deal" Brexit is, he writes, "verging on the delusional". And although Warner's grasp of the detail is sketchy – as is understanding of the legal background to the application of non-tariff barriers, he does at least recognise that the EU makes it plain that Britain becomes a third country from the moment it exits. 

Without some form of dispensation, he writes (not appreciating that this is not possible in a "no deal" scenario), he warns that "all those myriad tariff and non-tariff barriers to trade immediately kick in". And although he thinks this "may be legalistic and irrational", this "is the law. There is almost no business that takes place outside a legal framework of this sort".

One example he offers is selling medical equipment in the EU, which requires a certificate – or Conformité Européene marking – to show required standards are met. These certificates, he notes, are pretty much automatic for EU members, and as it happens are substantially written here in the UK for the EU as a whole, but would cease to be valid for UK suppliers when Britain becomes a third country. UK certification authorities will no longer be recognised.

Even if the UK said it planned to remain fully compliant with the EU, including ECJ rulings on such matters, the EU could "if it wished to play hardball" either refuse such certificates or subject British medical equipment to vigorous border controls to ensure compliance". 

Wrongly, Warner asserts that "some countries – Switzerland, Australia and Turkey – enjoy mutual recognition with the EU on medical equipment standards" - which is not the case. The man is confusing recognition of standards with recognition of conformity assessment.  He is right, though, is saying that such recognition, "by definition" requires a deal to be struck. 

As to the WTO, so long as the EU can show it no more discriminates against the UK than any other third country, it would be within the rules. This, says Warner, will be easy enough in all the high value-added trade the UK does with the EU.

Here, he hasn't quite got it. The man does not seem to understand that the EU is obliged to impose these controls, in order to avoid discriminating against other third countries. Thus, he wrongly sees the EU approach as "vindictive, economically irrational and self-harming", even if he acknowledges that the EU "shows no sign of giving way" without fully understanding why.

To raise these points is not to succumb to Project Fear, Warner concludes – in a flash of honesty that is rare in the Telegraph. But what no newspaper (or broadcast media) has yet to do is fully confront the consequences.

Obviously, the government will do everything it can to take the high-profile issues off the front pages. But what they will not be able to avoid is the torrent of news about business shut-downs and job losses. With the loss of access also to the EU's trade deals, we are effectively looking at the collapse of the UK's export trade.

An unresolved, "no deal" scenario could, by the end of next year, have unemployment running into millions. This will be partially disguised by EU immigrants returning home but, while the government may be partially successful in keeping the queues of lorries off the roads, it will have less success in concealing the size of the dole queues.

That will be the ultimate "no deal" penalty and one which could be with us for a very long time.



Richard North 08/08/2018 link

Brexit: getting the message

Tuesday 7 August 2018  



It's behind a paywall but if you want to get the backstory for what former foreign secretary William Hague has written for the Telegraph, coprophagia works in our favour for once. You can read all about it in the Independent.

If Hague really believes what he is writing – suggesting that Macron can intervene to find "creative answers" to the Brexit talks – then he learned very little about the EU in his tenure as foreign secretary. On the other hand, this could just be another attempt to paint the UK as the "victim", using the intransigence of the French as a back-up in case people don't entirely buy the "Brussels bullies" story.

After all, if the British public can be assumed to be gullible enough, they can be sold the story line that Mrs May's Chequers plan could have been a goer, if only the French President had intervened. That he didn't even respond after our prime minister cut short her holiday to see him obviously shows that these damn foreigners can't be relied on, so no fault can possibly attach to "team UK" for failure of the talks.

And if that theory is mad enough to be true, so is the squib from The Sun which is as neat a piece of character assassination as Nick Gutteridge and Tom Newton Dunn could devise, aimed – some say – at destabilising Mrs May and clearing the way for a leadership bid by Mr Johnson after the recess.

The essence of The Sun's story – so far exclusive to the paper – is that Mrs May has been so "irrational" and "emotionally inspired" throughout the Brexit talks that the Commission has preferred "dealing with the tub-thumping US President".

Speaking to The Sun anonymously (as ever), an "EU ambassador" has savaged Mrs May's proposal for a goods only trade deal as two centuries out of date – dubbing it "very nostalgic" for the seafaring days of Empire. This "very senior figure" added: "If this had been a rational discussion like we have with Trump on cars, what's underneath is rational". But, with the UK "from the start this has not been a rational negotiation, that’s what makes it so difficult".

There is some logic, here, one supposes, in trashing both Mrs May and her plan. Alongside the "ultras" pouring out of the woodwork to support the "WTO option", that creates the space for a right-wing saviour to emerge – one who will cut ties with Brussels and take us out to the new-found nirvana of a relationship dominated by WTO rules.

This might be enough to explain why there is no attempt to engage on the WTO option. In this scenario, it is being used as a political platform rather than as a serious argument, which would make the purity of the message far more important than the content. We are being treated to the gospel of our new saviours, to be embraced by the messiah once he rises again.

Here though, one is not quite sure whether The Times is on-message, with a seriously mad piece by Clare Foges (who she?) standing in for Rachael Sylvester.

From the keyboard of this person, under the headline, "The EU was always going to punish us for Brexit", we are treated to the thesis that attacking Brussels for "intransigence" shows "how deluded Leavers are about their ability to strike a favourable deal".

Writes la Foges, "the EU intransigence Liam Fox rages about was destined from the start". Brexiteers are thus enjoined not to claim, "when the current shambles deepens to a crisis, that it would all have been different if we’d been more bold, if we’d had more hope or optimism, or if the government had prepared more thoroughly for a no-deal outcome".

We must not, it appears, "hang this all on the hapless Theresa May, the greatest fall-guy in political history who (though not good at her job) could have as easily changed the mind of the EU establishment as changed the tides of the sea".

If only we had had the great insight of this far-seeing columnist, we would have known all along that the Europeans "were always going to put first the integrity of the single market, the four freedoms, the project they believe in so passionately".

On that basis, we have to accept that Britain "was always going to scrape a deal that would leave us worse off than before, or no deal that will take us God knows where". The writing was always on the wall, writes Foges. That's why Brexit was always a terrible idea.

Where that actually takes us, God knows. In the middle of an existential crisis over how we manage the Brexit process, it is so very useful to be told that we shouldn't have embarked on the venture in the first place. Without such perspicacious journalism, how could we possibly function as a society?

There is perhaps some better comfort to be gained from John Harris in the Guardian who has finally woken up to the danger of the "ultras" and reports under the heading: "Rich, reckless Brexit zealots are fighting a new class war". The likes of Liam Fox seek a Britain that would be disastrous for many leave voters, he writes, declaring that "these ultra-free-marketeers must be stopped".

Picking up on the usual suspects, Harris tells us that the left has failed to really go for them for far too long. Part of the explanation, he suggests, lies in both an aversion to offending leave supporters who might vote Labour, and a sense that Johnson, Farage et al are an integral part of the crisis that may yet bring down the government.

That certainly makes sense, as Labour has been so busy exploiting the shambles for its own party political gain that it has not been anywhere near being an effective opposition. And the result, Harris argues, is that these people have been able to exert an influence on politics – and, by extension, the future of the country – way beyond their merit. It is time, he says, they were battled with.

But there is nothing much on offer apart from polemics. "The left has to wake up", say Harris. "It is the reckless right, not 'Blairites' and centrists, that is the real enemy. If we want an end to the fear and anxiety that currently define the national mood and a future worth living for, these are the saboteurs who will have to be crushed".

Pete is a little more direct, arguing that, if we want the job done, we'll have to do it ourselves. Much of the political battle is being fought out on social media – the blogs and Twitter in particular, and while the world sleeps, we are fighting back.

No one, not even the mighty Mail can claim to be influencing a government which has long since ceased to listen to anyone, but politics is about creating a groundswell, telling politicians what is and is not acceptable. And, with a growing reach, our message is being heard.

That said, the "stunning" news of the morning comes from The Times, rather out of left field. An issue that should have been settled – our access to Europol – has re-emerged.

Police leaders are warning that, in the absence of a negotiated settlement, forces across the country would face "a significant loss of operational capacity" instantly, losing vital access to cross-border investigative powers and databases.

This is in a letter from the Association of Police and Crime Commissioners (APCC), sent to Mr Javid. It says that: "Considerable additional resource would be required for policing to operate using non-EU tools and that such tools would be suboptimal - potentially putting operational efficiency and public safety at risk".

No doubt, the "reckless right" can dismiss this as another contribution to "project fear", as they groom their messiah to take over from the hapless Mrs May, with Ruth Lea being the latest to add her stupidity to the continuum, with the false and often debunked assertion that "the US trades with the #EU under WTO rules, without a preferential trade deal".

But it was significant that, of the 53 responses, the vast majority were hostile, telling Miss Lea that she was wrong. She won't listen – the "ultras" never do – but the many thousands who read the thread will have got the message. Every one of us has a voice. We must all learn how to use it the most effective way.



Richard North 07/08/2018 link

Brexit: the blame game

Monday 6 August 2018  



The Telegraph and its allies are getting madder and madder. Currently, they are enlisting anonymous "senior Whitehall sources" to invoke Article 8 (TEU).

This is barrack room lawyer stuff where they point out that that the Article states that the Union is required to "develop a special relationship with neighbouring countries, aiming to establish an area of prosperity and good neighbourliness, founded on the values of the Union and characterised by close and peaceful relations based on cooperation".

Needless to say, they don't quote the whole of the Article. But paragraph 2, far from being mandatory, it is permissive. It declares that the Union "may conclude specific agreements with the countries concerned", and those agreements "may contain reciprocal rights and obligations as well as the possibility of undertaking activities jointly".

But such is the febrile atmosphere in London that the EU is deemed to be "stalling", thereby bringing the prospect of "no deal" ever closer. If it refuses to "compromise" on Brexit, unnamed ministers are warning that Brussels will be breaking its own laws.

According to our "senior Whitehall source", the situation is simplicity itself. He says: "We have made an offer that some people think is on the generous side and the EU has to know we are not kidding. If they don't like our offer they need to come back and say what the alternative is, but they can't just keep stalling".

This source has it that Brussels needs to accept "that we've done nothing wrong. We left under the terms of the Lisbon Treaty, which says they have obligations to help us. The way they are behaving is making things difficult and if we end up with no deal we will make it clear whose fault it was".

Thus, as the sheer incompetence of the May administration drives us inexorably towards a "no deal" scenario, the "blame Brussels" narrative is being dusted off and polished. By the time we come to dropping out, London will have acquired the girdle of innocence and the failure of the talks will be entirely the fault of the EU's "bully boys".

At least, that is the theory but, as we've seen, Barnier has long anticipated that stratagem and will have none of it. The EU will not be "impressed" by such claims, the stress being on the UK which is leaving the EU. "It cannot, on leaving, ask us to change who we are and how we operate", Barnier says.

But, if blame is becoming an open topic of discussion, it says little for the prospects of a successful resolution to the talks, especially as the "ultras" have been moving into high gear to talk down the consequences of a "no deal".

Latest in the long line of false witnesses is Matt Ridley, brother-in-law of Owen Paterson – showing the same level of judgement he displayed in his chairmanship of Northern Rock. He is using his column in The Times to churn out the same mantras, under the far-from-original headline: "We've nothing to fear from a world-trade Brexit".

You have to give it to these people: they are both predictable and consistent – and always wrong. Any measures Brussels could take "to strangle our economy in retaliation" (for our leaving) would, according to this great sage, "be illegal under the World Trade Organisation rules".

Claims that there could be customs delays and non-tariff standards barriers against British food exports or imports fly in the face of what we actually know, he says, asserting that the WTO's Agreement on Sanitary and Phytosanitary Measures, its Technical Barriers to Trade Agreement and its Trade Facilitation Agreement "all now forbid discrimination against a WTO member".

Just simple logic should warn this man that there might be a little hole is his argument on the SPS Agreement. This agreement came into force on 1 January 1995 – 23 years ago. For all that period, controls of the import of foodstuffs into the EU have been developing and, after nearly a quarter of a century, they stand intact within the framework of the WTO, unchallenged.

It stands to reason that, after all this time, the EU's third country regime must be considered WTO compliant. And, as far as discrimination goes, the only way the EU would fall foul of WTO rules would be if it didn't apply these rules to the UK once it had become a third country. It would have all those countries which are currently subject to the regime complaining that the UK was being treated as a special case.

However, like his follow travellers, Ridley is extremely selective in what he quotes, relying on an extremely dishonest piece from Michael Burrage, who argues that over the 22 years from 1993 to 2015 the leading countries that export to the European Union "on WTO terms" grew their trade with the EU almost twice as fast as countries within the EU grew their trade with each other.

Not withstanding that there are no substantial economies trading with the EU on WTO terms, the point that emerges here is simply that developing countries grow their trade – from relatively low bases – faster in percentage terms than mature economies with longstanding trade relations. In the context of the Internal Market, the primary aim is to reduce the cost of cross-border trade and to speed up its flow.

But then, Burrage has form when it comes to the manipulation of data, having produced several reports, such as this and this, which badly misrepresent the situation.

Ridley's choice of source, therefore, says more about him than the validity of his arguments, more so when he uses an extremely tendentious quote attributed to Roberto Azevêdo, director-general of the WTO.

This was in a piece written by another false witness, Liam Halligan, where Azevêdo is claimed to have said: "About half of the UK's trade is already on WTO terms with the US, China and several large emerging nations where the EU doesn't have trade agreements. So it's not the end of the world if the UK trades under WTO rules with the EU".

The accuracy of that claim is extremely dubious, given that Azevêdo had never said anything like it before (or since) and, a few days later he all but contradicted Halligan's "spin".

At that point, Azevêdo said, "Whatever happens, this is not going to be a situation where all trade stops, and there is a collapse in terms of the economy as a whole - that for me would be the end of the world". 

He went on to say: "But it's not going to be a walk in the park. It's not like nothing happened, there will be an impact. It will be a very bumpy road, and maybe long as well". It is the first quote not the second that Ridley uses, the former fitting his narrative. This is a man with a mission to deceive – an out-and-out fraud who will do whatever it takes to make his case.

Of course, The Times is just as much at fault in allowing this rubbish to be printed. Freedom of speech is not a license to distort and, in return for the many privileges afforded them, newspapers have a duty to their readers to avoid misleading them. Editor John Witherow needs to get a grip. 

When it comes to the blame game, therefore, one must look at this in the round, where it is reasonable to assume that a properly informed public, aware of the consequences of a "no deal", would not tolerate a government which allowed it to happen.

Where newspapers allow the likes of Ridley falsely to downplay the consequences, they too must share some of the blame if the outcome goes in the direction of "no deal". The media must be more accountable for its actions and less tolerant of false witnesses in its ranks.

There are no circumstances where the WTO option could be anything other than disastrous. We have got to the stage where, in a mature debate, any claim to the contrary, and in particular assertions that there is "nothing to fear", is demonstrably false. Those who have not explored the issues have no business pronouncing on them.

Pete would have it that those who say we can rely on WTO rules as a basis for our post-Brexit trade relations are professional liars. I find it hard to disagree.



Richard North 06/08/2018 link
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