Brexit: "in a different galaxy"

Saturday 29 April 2017  

When it comes to the UK government's attitude to the forthcoming Article 50 negotiations, two separate newspapers are reporting the same thing, but in such terms that they are getting their information from separate sources, rather than just recycling the same material.

The first of which we became aware was the Guardian, which referred back to the Merkel address in the Bundestag. From this, the reason the German Chancellor made comments about time-wasting delusions, it appears, is that she had been acquainted with the experiences of Commission President Jean-Claude Juncker and Michael Barnier, who had met Theresa May and her senior officials at a dinner the previous night at No 10.

They had come away with the idea that May's team has not "engaged with reality" on David Cameron’s promises to pay into the EU budget until 2020 – a promise Brussels insists the British must stick to. "They [the British] are not just on a different planet, they are in a different galaxy", said the source.

According to the Guardian, one EU diplomat added to this, saying: "I am deeply pessimistic that there will be a positive outcome from this negotiation", putting the chances of the UK crashing out of the EU without a deal as higher than 50 percent.

Then we have the Financial Times reporting that senior diplomats have come away from meetings with Theresa May, "especially alarmed over London's insistence that there need not be a significant exit charge, which the Commission estimates at up to €60 billion". One said the situation was "dangerous" while another said expectations were "unreal".

Mrs May's team, we are told by this newspaper, is confident that the EU's demands are an opening bid and that the negotiations will soon become more realistic over money, with many EU states keen to retain access to UK markets.

But here again, the €60 billion is an invention by the Financial Times. It has no substance in fact, and does not comprise a formal demand put to the UK Government by the EU's negotiating team. In fact, no formal demands of any nature have yet been made.

But, as we pointed out recently, the true figure for outstanding liabilities (RAL) is probably closer to £30 billion. And, since the sums only become progressively due, it is likely that we will be offered annual payments. I have suggested a sum of £4 billion a year for the next seven-year MFF period.

The thing is, as I remarked, payments were always going to be phased. That is the way the RAL works. Furthermore, there was never any question of the "colleagues" slapping a bill on the table. That isn't the way RAL works. The precise figures isn't known until after the end of the current MFF period. Even if it wanted to, the Commission could not yet tell the UK what the figure was.

That might help to put the issue more in context. And it would also explain why, according to The Daily Telegraph, a British official with knowledge of the UK negotiations says that "the European Commission's calculation that the UK owed €60bn were outlandish, even when including all the 'contingent' and other liabilities listed by the Commission".

"Even using their broadest parameters, we run the numbers and cannot get to €60bn", the source says, "a lot of the things being said by the European side now are simply unrealistic. Everyone is posturing and positioning. The negotiations will bring it all back to reality".

But here we go again. The Commission hasn't actually made any calculations yet. For the reasons explained, it can't. All that's happened is that some European notables have repeated the exaggerated FT figure and, like a virus, it's got stuck in the system.

What is more, the Merkel criticism goes a lot wider than just the money issue. The German Chancellor alluded to unrealistic UK expectations of wider market access and the retention of membership privileges, despite acquiring "third country" status once we leave the EU.

Nevertheless, in just money terms, it does appear that the UK could be prepared to compromise. According to The Telegraph, the UK could contemplate paying budget contributions up to 2020 and even beyond, "so long as the money opened the door to a reasonable transition period and a deep trade deal".

In that latter respect, though, the UK would probably be disappointed. While the EU has already signalled its willingness to discuss a (time-limited) transitional arrangement and (eventually), a trade deal, it is unlikely that it will accept any conditionality. The UK will be expected to draw up the heads of agreement on the financial settlement before the EU negotiators are prepared even to discuss the next stage.

This has been made abundantly clear by European Council President Donald Tusk. In a letter to the 27 Member States (but not the UK) inviting them to Saturday's European Council meeting, he has stated that agreement on "people, money and Ireland" must come before negotiations on the European Union's future relationship with the UK. A trade deal is not a priority.

In very explicit terms, he writes: "Let me highlight one element of our proposed guidelines, which I believe is key for the success of these negotiations, and therefore needs to be precisely understood and fully accepted".

He then goes on to refer to the idea of "a phased approach". This, he says, "means that we will not discuss our future relations with the UK until we have achieved sufficient progress on the main issues relating to the UK's withdrawal from the EU". It is simply not possible to be any clearer than that and, as Tusk says, this is not only a matter of tactics. Given the limited time frame we have to conclude the Talks, he explains, "it is the only possible approach".

With only a very slight softening, he declares that, "before discussing our future, we must first sort out our past". We need, he says, to secure the best guarantees for our citizens and their families. And he is not messing. Guarantees, he says, have to be "effective, enforceable, non-discriminatory and comprehensive". And they should be accompanied by simple and smooth administrative procedures.

At that point, he then says, "We should also agree with the UK that all financial obligations undertaken by the EU of 28 will be honoured also by the UK". No sum is mentioned. That is to come.

But his third point then puts Ireland on a par with the other issues. In order to protect the peace and reconciliation process described by the Good Friday Agreement, he says, we should aim to avoid a hard border between the Republic of Ireland and Northern Ireland.

It is good news, in a way, that the Council sees this as a priority, except that the intervention has been seen as the EU endorsing (or seeking) a united Ireland. And whatever the political implications, it is hard to see how otherwise a hard border can be avoided.

Come what may, all three points will have to be resolved before the negotiations can move on. Tusk re-iterates that, "only once we collectively determine in the European Council that sufficient progress has been made on all these issues, will we be in a position to hold preparatory talks on the future relationship with the UK".

And so high up the batting order is Tusk putting this, that he is asking the "colleagues" to unite around this key principle during today's meeting. He wants it clear that progress on people, money and Ireland must come first. Furthermore, he says, we have to be ready to defend this logic during the upcoming negotiations.

Thus, no one can say we haven't been warned. Our politicians can choose to reside in a different galaxy, or they can come down to earth and join the rest of us. But given where they've been all these months, they cannot expect a soft landing.

Richard North 29/04/2017 link

Brexit: "wasted time"

Friday 28 April 2017  

Remarkably, although it was strongly featured in the English media, Merkel's address to the Bundestag on Brexit was harder to find in the German online media sites.

But at least, when it came down to it, The Times and de Welt had roughly the same headlines, the former: "Britain is wasting time with Brexit delusions, Merkel warns" and the latter: "'Wasted Time' - Merkel warns Britons of illusions".

The Frankfurter Allgemein Zeitung (FAZ) also picks up the theme of "illusions", and with brutal accuracy conveys Merkel's message that, on leaving EU, "Britain would have the status of a third country" – part of her address which drew applause from the deputies.

This is something we have been saying for a long time but there are an awful lot of people seem to have difficulties understanding it.

Yet, because of that, says Merkel, Britain will not have the same rights as a member of the Union, or even be better placed. This is actually a matter of course, but "some in the UK", she says, "apparently still had illusions". And with absolutely concessions to their finer sensibilities, tells them that this is "wasted time".

The Guardian, however, transforms "some in the UK" to "British politicians", which is not what Merkel said. This is not just confined to the politicians – a significant number of others harbour the illusion.

Coming as it does just days before the European Council, this blunt speaking comes as a welcome corrective to the morass of stupidity that has been poisoning the Brexit debate. Merkel has told it as it is, and there's no going back: "third country status" here we come.

As to the forthcoming negotiations, according to FAZ, Merkel also took the opportunity to announce a hard line. The Federal Government, she says, has three concerns.

Firstly, there is the fate of 100,000 Germans living in the UK, whose interests must be protected. Secondly, damage to the European Union arising from a change of a Member State to a third country must be averted. And thirdly, it is necessary to strengthen the cohesion of the remaining 27 EU Member States.

Already, she says, talks over the past few weeks have shown that the European Council will "have a strong signal of unity". The guidelines are the basis for the negotiating mandate for the Commission, she adds. "We are aware of the scale of the task, but we are also well prepared".

Then, in what amounts for bad news for Mrs May but is nevertheless entirely predictable, Merkel says that the question of UK financial commitments to the EU must be discussed at an "early stage" and placed at the centre of the talks. It made "no sense" to negotiate a future UK-EU relationship without agreement on the UK's financial commitment to the EU, which has to "extend into the period after Britain’s exit".

The conditions of exit had to be clarified before all other aspects, establishing "legal certainty" as to the (economic) consequences of the withdrawal. Only then, she said, could the future relationship between the EU and Great Britain be discussed. And this order was "irreversible". She rejected out of hand parallel negotiations on trade.

Thus do we see the German Chancellor set out the framework for the Article 50 and is unlikely that this is going to change. It is, in effect, "irreversible". And Mrs Merkel is absolutely right is saying that time has been wasted.

The Guardian avers that her address was a "stern rebuke" for Britain, which had been hoping there was some ambiguity in the EU position on whether trade talks could run in parallel with negotiations on separation terms before a financial settlement.

Yet just minutes before she spoke, the idiot savant Johnson was being pressed in a BBC interview about whether trade would have to wait until the divorce bill was settled. "We'll see", he responded, demonstrating his usual lack of grip on reality, the same lack that had him defending Vote Leave's absurd £350 million a week claim.

But if Johnson insists on inhabiting his fantasy world, this is not so easily open to Mrs May. For her, Merkel's intervention should be a wake-up call – it is certainly one which she can't afford to ignore. Should she even try, she will get a stark reminder over the weekend when the European Council publishes its approved negotiation guidelines.

If there was any sense to this debate, this would be a galvanising moment. One which set the general election campaign on fire. Angela Merkel has set the agenda – Mrs May and the other protagonists must respond and they're all running out options.

No matter what any of them have said in the past, or is being suggested, a new elected government must have clear objectives.

Firstly, it must come up with a rational plan to deal with the EU's financial expectations and matters related to the conclusion of an Article 50 agreement. This will include settling the status of nationals of EU Member States currently resident in the United Kingdom.

Secondly, it will have to abandon any idea of pursuing a free trade agreement with the EU in the near future. This is not an immediate option. Instead, the government will have to concentrate its resources on defining a workable transitional agreement. This will be the absolute priority and it is pointless trying to evade it.

Even at this stage, it is still possible to go for the Efta/EEA option, which would vastly simplify the administrative problems in constructing the necessary secession treaty. But this cannot happen unless the parties focus. Otherwise, we could find ourselves sliding into disaster, without being able to influence events.

And to that extent we are back where we started, confronting the reality of that which was always going to be – the pursuit of an interim agreement that will buy us time for a long-term solution.

Sadly, though, it does not seem likely that any of the parties are prepared to approach Brexit with this degree of clarity, preferring instead their own fantasies. This, we already see with the CBI which, bizarrely, is calling for the EU should to "stop squeezing UK for [a] 'divorce settlement' and focus on trade deal".

This desperate air of unreality flies in the face of everything that we know and have learned of the EU's approach to the negotiations. But, at least, Mrs Merkel has done us the favour of setting out the battle lines, and given us fair warning of what is expected of us.

Too much time has been wasted already: we ignore what Mrs Merkel tells us at our peril.

Richard North 28/04/2017 link

Brexit: a temporary end to the charade

Thursday 27 April 2017  

It is a small event, but to have Peter "ten minute" Lilley stand down from Parliament at this election is good news. It removes a prominent "Ultra" from the ranks of the Conservative – and if it was Mrs May's intention to dilute their ranks, she has succeeded in that respect.

There is, of course, a personal issue, as the man's unwanted intervention has not made life any easier, especially as he is regarded as something as an intellectual amongst his peers. But with him now on his way, we can perhaps remember him as one of the five MPs (including the tellers) who voted against the Climate Change Act.

Nevertheless, in the very last PMQs of his 34-year career, Lilley was not content to leave things alone, asking Mrs May whether she agreed that, if we are to secure a reasonable deal, we must accept that no deal is indeed better than a bad deal. To deny this, he said, "signals that no price is too high, no concession too grovelling to accept - a recipe for the worst possible deal".

If this signifies an "intellectual" approach to politics, though, then it is no wonder we are in so much trouble. Since no possible outcome could be worse than "no deal", then to walk away from the talks is not a credible threat. To put it on the table merely invites the "colleagues" to call our bluff – for that it would be – leaving us with nowhere to go.

Fortunately, Mrs May didn't rise to the bait. Dead-batting Lilley's proposition, she merely remarked that the only way to ensure we had "a strong hand in negotiations" was to ensure that a Conservative Government was elected on 8 June.

Certainly, that is probably necessary, although I doubt very much whether it is sufficient – there is a lot more to do before we are even close to a tenable negotiating position.

But that left another departee, the former Ukip MP for Clacton, Douglas Carswell, to ask Mrs May what assurances she could give the 3.8 million Ukip voters at the least election that the "United Kingdom will become a sovereign country again, living under our own Parliament and making our own laws".

Mrs May easily fielded that one, giving an assurance to "all those people who voted for the United Kingdom to leave the European Union - and to all people across the country, regardless of how they voted" that "we want to see control of our borders, control of our laws and control of our money". And that, she said, "is what we will deliver" – even if she didn't commit herself to a timescale.

But, if these were the last ever questions that the Prime Minister will answer from this pair, it was also the last session of the Parliament before it prorogues, the MPs have to turn off the official websites, and those that wish to sit again have (briefly) to fight for their livings.

Jeremy Corbyn tried to make the most of the occasion, attempting to focus the campaign on Labour's comfort zone, turning this into an "NHS election". He failed, of course. There can be few in this country who see this as anything other than a "Mandate for May" to take with her to Brussels.

Even if Mrs May was on less sparkling form, I suspect it had nothing to do with Ukip's Brexit spokesman Gerard Batten declaring his intention to stand for Maidenhead, seeking to depose the Prime Minister.

At least Batten is standing – which is more than can be said for his leader, as the party slides down to four percent in one set of polls, while even YouGov has them on a mere seven percent.

What may have preoccupied Mrs May was then a coming meeting in No 10 with M. Barnier and Juncker, prior to the European Council meeting this weekend. But beyond knowing that the process of the UK's withdrawal from the EU was discussed, we are none the wiser. One hopes that Mrs May will be.

In another remarkable counterpoint, though, we can be absolutely assured that one person left completely untouched by wisdom is the sociopathic Mr Johnson who has been speaking at the Lord Mayor's banquet, telling his audience that Brexit could usher in a "new era of trade deals".

Amongst the happy little fantasies that Mr Johnson entertains is that that he can secure tariff reductions on Scotch whisky, thereby increasing sales to India. Yet, since local and state discriminatory taxes are also applied, this would not have anything like the effect he might wish for.

Mr Johnson might also talk to existing importers who are finding that arcane labelling requirements are limiting export opportunities.

For instance, exporters were quite content to affix stickers to product packs, specifying country-specific details but then regulations changed to require details to be printed on packs before they are shipped to India. If any details are incorrect, importers are not allowed to correct them in order to secure customs clearance. The goods have to be returned to the originating country.

A similar problem currently affects the maximum retail prices which must be printed on packaging before the goods are submitted for customs clearance. However, since the price is affected by local taxes which cannot be known until is distributed for sale, the requirements are impossible to meet and become absolute barriers to the import of certain goods.

This is but a small taste of the non-tariff barriers that await us when we seek to do business in that brave, new post-Brexit world. Currently, these Indian labelling regulations are only the tip of the iceberg.

Another delight was the introduction of 100 percent sampling of containers, when earlier sampling had been limited to 5-10 percent. At one time, containers were hardly getting cleared, with disastrous effect on the sale of imported snacks and treats during the festival season.

The point here is that no sooner is one obstruction cleared then the inventive Indian authorities dream up something new to frustrate their importers. If Mr Johnson thinks that the Indian sub-continent is going to bail him out, he's sadly mistaken.

Needless to say though, adult discussion of such issues in on hold, while the idiots unite to prattle about tariff barriers which have long since ceased to have any relevance.

Softly, softly, though, banks and other businesses are preparing to move staff out of the UK, with thousands of jobs on notice to move. By no means are all these are being publicised, but high-level managers are speaking privately about plans which have moved from speculation to firm intention.

Yet, all the while, we get this pathetic little charade in Parliament, with politicians and their fellow travellers endlessly prattling about that which they know nothing. The one small mercy is that we are spared the weekly ritual of PMQs for a while, although the replacements are hardly likely to prove any better.

Richard North 27/04/2017 link

Brexit: waiting for reality

Wednesday 26 April 2017  

Rather as expected, the election has driven out most of the already dismal Brexit coverage, leaving us with thin pickings and very little to go on. For the moment, that's how it's going to be and there is no point in complaining.

The lack of focus, however, doesn't stop the Muppets coming out to play, led in this instance by Open Europe which is claiming that the UK doesn't need to rely on trade with the EU.

Their grasp of the issues is such that they are arguing that underdeveloped links with countries such as India, Canada and Israel can replace EU trade. The top 10 "underperforming" UK export markets have untapped potential of more than £41 billion by 2030, they claim.

So this is what London's "finest" have to offer: we can rely on £41 billion-worth of trade in 13 year's time to replace approximately £230 billion-worth of trade annually with the EU right now. With that level of genius at our disposal, we can' t possibly lose.

Not much more can be said of Labour's Shadow Secretary of State for Brexit, Keir Starmer, who has set out his party's position for the duration.

Mr Starmer tells us that there will be a very clear choice on the ballot paper in June, a choice of two visions of Brexit. Labour's approach will be based on its supposed values: internationalist and outward looking, fortified by a belief that "we achieve more together than we do alone".

While accept that "outside the EU our relationship with Europe must change", Labour does not accept that Brexit has to mean whatever Theresa May says it means. They do not accept that there has to be "a reckless Tory Brexit" and then, in something of a no sequitur, Starmer adds that "we do not believe that if you're a citizen of the world, you're a citizen of nowhere".

The trouble is that, if you follow his speech and get past this passage, you still have 1,700 words to go before you discover that Starmer is saying not very much at all, and much of what he does say is contradictory.

For instance, he recognises that immigration rules will have to change as we exit the EU, but we do not believe that immigration should be the overarching priority – and he doesn't believe it should stop either. Existing EU immigrants, though, should be allowed to stay if they want to.

So, even though he will have us stopping freedom of movement, except where he doesn't, he still wants to retain the benefits of the Single Market and the Customs Union. He wants hard-fought workplace rights and the environment are protected and wants "a Brexit that brings the country together, radically devolves power and supports all regions and nations of the UK".

At least "no deal" is not a "viable option". Labour's approach to Brexit means ending this reckless approach and making it clear to our EU partners that "we will seek to negotiate strong transitional arrangements as we leave the EU and to ensure there is no cliff-edge for the UK economy".

But, if this is all nice, cuddly, apple pie and motherhood stuff, as always we see no detail and no recognition of how to overcome the hurdles in trying to negotiate such a complex deal in such an insanely short period of time.

Rest assured, though, even if Labour doesn't really know what we want or, more particularly, how to get it, Parliament will at least have a "meaningful vote" whenever it is we get whatever is given to us by the "colleagues". How the vote then becomes meaningful is left up in the air, as Starmer doesn't say what will happen if the vote goes against the government.

That is not to say that the Conservatives are being any more specific about what they want, or how they intend to achieve it – but then they're not in the hot seat.

Somebody is most definitely in the hot seat is Ukip leader Paul Nuttall who, with every passing day, looks more like a parody of himself.

Currently refusing to commit himself to standing for a Westminster seat – unlike Farage and his crony Arron Banks, both of whom have definitely ducked the challenge, Nuttall will be the first party leader not to stand for a general election since the last one, which just happened to be Malcom Pearson, also a Ukip leader. Before that, apparently, you have to go back to Lord Salisbury.

In the meantime, as Ukip resolutely fails to offer a credible or even coherent template for Britain's exit, and allows itself to be cast as riding the Islamophobia wagon. Members are falling away and the poll rating is nose-diving - well into single figures which may not stop at five percent.

Whatever else, the party is over for Ukip as Tories soak up the votes, returning us to a semblance of the traditional two-party politics. Even the Lib-Dems don't seem to be getting much of a showing.

Meanwhile, the Telegraph has suddenly discovered that we will have to continue paying into the EU budget until the end of the MFF period in December 2020.

Even though we have reported this many times, in accordance with newspaper procedure, nothing exists until the fourth estate discovers it, when it takes the credit for its own brilliance. Hence the Mail is also on the case, setting out the demands that the "colleagues" will declare on Saturday's summit.

Speaking of old stories, The Times has reported on the Chinese customs fraud which we featured last month, although it has added some details about the way the fraud is carried out.

Potentially, this could coast us another €2 billion in compensation to Brussels, even if this is not being linked to the Brexit talks. Money, more than anything else, seems to be doing the talking during these negotiations.

And coming back to Mr Starmer, this is his most obvious lacuna. Time and time and time again, the "colleagues" have made it clear that there will be no progress on the Brexit talks until the money question is settled, even if it is just in principle. To be credible. Labour needed to spell out how they would handle the issue. But instead we get silence.

That silence will look all the more fragile come Saturday when the "colleagues" are due to agree their formal negotiating guidelines. Under normal circumstances, these should have kickstarted the negotiations, but everything on the British side is on hold until after the election.

With luck, the contestants will be forced to respond to Brussels, with even the possibility that some reality is injected into the debate. Failing that, we'll be looking for a bunker in which we can hide. I'm not sure I can take another six weeks of this.

Richard North 26/04/2017 link

Brexit: Macron – neither good nor bad

Tuesday 25 April 2017  

It says something of the general election campaign – still cranking into gear – that, briefly, the English media have found the French election marginally more interesting than our own.

But it should come as no great surprise that the English press is just as ill-informed about French politics as it is about everything else. Thus do we have the Daily Mail proclaiming a "New French Revolution", marking the success of Emmanuel Macron in the first round of the presidential contest, with Marine Le Pen taking second place.

Only an English paper, though, could describe a process which puts a Jesuit-trained enarque in pole position as a "revolution". As a former member of the Socialist Party, a senior member of President Hollande's staff and then Minister of Economy and Finance, Macron is nothing if not a political insider, from the very heart of the establishment.

Furthermore, although the English media is also making great play of the "wipe-out" of the traditional parties, political parties by no means have the same resonance in France as they do in the UK.

The centre-right, in particular, has been playing fast and loose with party names, from de Gaulle's Union for the New Republic (Union pour la nouvelle république or UNR) onwards. Having been started up as a platform for de Gaulle, it was replaced for the 1968 legislative election by the Union for the Defence of the Republic (Union pour la défense de la République or UDR).

In December 1976, the UDR was replaced by the Rally for the Republic (Rassemblement pour la République or RPR), a New Gaullist Party, devised as a machine of reconquest behind one man, Jacques Chirac (who, as presidential candidate later took on Le Pen senior).

Before the 2002 presidential election, RPR and non-RPR supporters of Chirac gathered in an association: the "Union on the move". It became the Union for the Presidential Majority (Union pour la majorité présidentielle or UMP), largely as a personal platform for Jacques Chirac.

Then in May 2015, with a Socialist government in power, the party was renamed and succeeded by the Republicans (Les Républicains). This party, formally less than two years old, provided the platform from which François Fillon mounted his challenge, gaining seven million votes and 19.94 percent of the poll, against Macron who took 23.7 percent, and Le Pen with 21.53 percent.

With parties of the right tailored to provide platforms for presidential candidates, it was entirely logical for Macron to set up his own party for the centre-left, to replace the hugely unpopular and discredited Socialist Party.

Although Macron now calls himself an "independent", his dependence on a tailor-made political platform is entirely in keeping with traditional French politics. The "wipe out" of traditional parties, therefore, is meaningless.

As to his stance on Brexit, he made this very clear before the referendum. France, he said, would not allow its British neighbour to be given any special status. "We are inside or outside, and the day after the departure, there will be no financial passport for the British establishments", he added, stating that the European Council must issue an ultimatum to the British about their intentions.

As far as the President of the Republic was concerned (and that most likely will be he), Macron had a very clear message: "If the United Kingdom wants a commercial treaty for access to the European market, the British will have to contribute to the European budget like the Norwegians or the Swiss. If London does not wish it, it must be a total exit".

Bizarrely, Norway does not contribute to the EU budget, but you would not expect French politicians to be any better informed about EU matters than their UK counterparts. The "invincible ignorance" we experience is not confined to this side of the Channel.

Looking at the "challenge" that would follow this referendum, in his view, the EU had two priorities. It had to: "avoid the contamination of the 'Brexit' and immediately relaunch the momentum of a positive project for Europe". 

Even if "Remain" prevails, Macron said at the time, France will take the initiative. "If we allow 'Brexit' to gnaw at the European adventure, you will have similar debates among the Danes, the Dutch, the Poles, the Hungarians, and this is already the case". Thus, he says, "we must return to the original promises of the European project: peace, prosperity and freedom". 

This, then, is a man from whom we cannot expect too much, although he will at least be predictable. And if the UK can offer a "European" solution to Brexit, then we could find in the new President a friend and an ally. It will be easier to deal with a "European" than a French nationalist from the de Gaulle mould.

However – assuming Macron gets the presidency – the real effect will not be felt until we see the outcome of the German federal election. And there, it seems more and more likely that Merkel will be re-elected chancellor.

Given that Macron has married a woman 24 years his senior (his one-time school teacher), one might be able to make tentative assumptions about his relationship with Merkel – positing that the Franco-German "motor" might be re-energised.

And it is this combination of two strongly Euro-centric leaders that will make the difference – even if it is not necessarily decisive. The one thing about which we can be certain is that the European Union performs best (in its own terms) when there is harmony between Berlin and Paris. And this, above all else, is what Macron may bring to the table.

As for Marine le Pen, it is doubtful whether she could ever overcome the electoral inertia that grips French politics and, while some voters are happy to have their fling on the first round, they invariably come into line in the run-offs. We have no reason to believe otherwise in this election.

The only real dampening effect on Macron's ambitions is likely to come in the legislative elections in June later this year. With the Socialists in disarray, the established party is unlikely to prevail. Macron's En Marche "movement", on the other hand, has not been around long enough to build up an effective party machine.

On that basis, one can speculate that Les Républicains will gain the majority of seats in the Assembly. And if that is the case, the newly-minted president may be forced into a period of cohabitation, limiting his freedom of action.

However, when it comes to Brexit, there is no discernible difference between Macron and Fillon, with the latter arguing for it to be "fast, hard and uncompromising". If that represents the position of Les Républicains, we will, if anything, be better off with Macron. But it also means that there will be few divisions that "Team Brexit" will be able to exploit.

All in all, from the election just past and the ones to come, we are probably no worse off, but no better off than we could expect. We are going to have to deal with Brexit, and if there was any expectation that the political calculus could change with either the French or German elections, that is fast evaporating.

Richard North 25/04/2017 link

Brexit: "invincible ignorance"

Monday 24 April 2017  

Tucked away in the Independent on Saturday and not repeated elsewhere was an article complaining of the "invincible ignorance" of "anti-EU ministers". The remark comes from former ECJ judge David Edward (pictured above) and even though it is confined to ministers' stances on the ECJ, it deserves wider coverage on that point alone.

But the complaint could to extended to cover the whole range of issues relevant to Brexit, where it can fairly be said that "invincible ignorance" is the dominant state in Westminster and Whitehall – and indeed what might also be termed "Fleet Street", the national media in its broadest sense.

The thing about government is that we are used to the narrative, fortified by the television series "Yes Minister", which has it that Departmental Secretaries of State and Prime Ministers sit at the peak of a hierarchy of diligent and gifted civil servants who wisely counsel their political masters on their options.

Thus informed – to an extent to which us mere mortals can only dream, politicians are able to weigh up the options and come to the best possible decisions, keeping the mechanisms of state functioning smoothly and efficiently.

The reality, though, is almost the reverse of expectations. The role of civil servants is not to keep their ministers informed. Rather, they are there to manage the flow of information, ensuring that ministers are told only that which they need to know (in the opinion of the civil servants) and then in such a matter as it will naturally lead to the desired decisions being made.

On that basis, far from being all-seeing and all-knowing, Ministers sitting in the gilded offices, are often the least informed people in the buildings they occupy, not uncommonly relying on Sky News or the BBC to give them a limited appreciation of what is happening, long after their civil servants have known the details.

That, however, describes the best of circumstances, where in each department there is some knowledge and institutional memory on which the "Mandarins" rely.

But the picture on Brexit is far worse. Here, we have "thirty somethings" who have never engaged in EU issues and who are profoundly ignorant of them and lack entirely any institutional memory. What little they know is often based on flawed and heavily biased information, used to cement and justify departmental policy.

On the other hand – and especially with the "three Brexiteers" – they are speaking to ideologically motivated ministers who rely on a simplistic and often fictional construct of the EU to guide them in their dealings with it, heedless of the fact that they are having to work with the most complex bureaucracy in the world.

Never more apt has been the phrase "blind leading the blind", except that this understates the problem. We are dealing in some instances with the wilfully blind who reject the idea that vision would be of any assistance and who spurn the advice of those who can see as being tainted.

From an external stance, it is very difficult trying to second-guess the actions of the ignorant. If one expects decisions to be based on logical conclusions which are reliant on weighing up all the facts and options, then predictions as to possible outcomes will most often be completely wrong.

Many decisions are in fact being taken in response to a flawed and limited appreciation of circumstances, heavily distorted by ideological preconceptions. This is very dangerous because it allows what otherwise might appear to stupid decisions to look quite sensible - and more rational decisions to look ill-founded and risky.

Turning specifically to the subject of the Independent article, we have David Edward warning that withdrawal from the court will not be simple and predicting that an anti-EU clique, who for years had lambasted the European Court, would turn its guns on British courts and judges. He thus slams the "invincible ignorance" of Brexit-backing ministers who believe they can free the UK from the court's influence.

Edward finds himself  "astonished" at what he called misleading promises of autonomy from the court, made by Brexiteer politicians. While the Prime Minister is expected to make distancing the UK from the ECJ an election pledge, he - alongside other academic and political experts – are underlining how difficult it will be for the Government to maintain its hard-line stance towards removing the court's role in British life.

Severing ties with Luxembourg, Edward says, will not be as simple as "leave means leave".  "You can escape the jurisdiction of the ECJ, but you have got to comply with EU standards if you are going to export into the EU", he adds, then pointing out that ECJ is the ultimate arbiter of what these standards mean if there is a problem.

The ECJ, he says, is not "stuffed with European judges who imposed their will on the unwilling British people". Rather, he adds, "a great number of cases we decided were brought by British people precisely in order to be able to trade freely".

As to maintaining "pure sovereign authority", Oxford law professor Paul Craig endorses the Edward view, stating that we will continue to have difficulties after Brexit. For sure. when we leave the EU, all rights and obligations cease, but the reality is that any UK business that wishes to do business in Europe will in effect have to comply with the relevant rules. "The idea we have some pure sovereign regulatory authority in the UK will simply not be true", he says.

Catherine Barnard, professor of EU law at the University of Cambridge, thinks the Prime Minister will find herself in a political bind – forced to appease "hard Brexiteers" by being as uncompromising in her language as she can. "Politically, [Ms May] has got to say Britain will be free from the ECJ because that is what the hard Brexiteers in the Government want. But in reality, two years is just not enough time to replicate the EU institutions", Barnard says.

What will happen is there will be a divorce so she can say we have left, and then there will be transitional arrangements, which will mean from air safety to plant variety, it may well be that we will continue to use the EU bodies because we can't just set up those 50 or so bodies in that time. This means there may still be a role for the ECJ".

The interesting thing here, though, is that while the newspaper is keen to bask in the reflected prestige of law professors and an ex-judge, the thrust of the argument is tiresomely shallow.

As so many standards are formulated at global level and we are having to confront the realities of globalisation in international trade, the ECJ in many respects is the least of our problems. If we are to remain part of that global system, as Peter points out, we as a nation will never recover ultimate sovereignty.

Pure unadulterated sovereignty no longer exists and it hasn't for a long time. Nations, says Pete (who isn't a law professor) have been bound by their agreements for as long as there have been nations. By leaving the EU we, at the very least, retake the right to say no and the right to refuse and propose regulations. We are about to enter a completely different universe of governance.

And therein lies an entirely new and different level of "invincible ignorance" as the "little Europeans" pontificate about their narrow obsessions, oblivious to the broader issues which will dominate decision-making.

In a debate about Brexit where the same old issues are endlessly rehearsed to the point of utter tedium, we need to inject more information and to widen our scope. As long as "invincible ignorance" is the dominant feature of this debate – from all side – we are never going to get that essential element of democracy: informed consent.

But come what may, Brexit continues to show up the information "fault lines", where the traditional opinion-formers are showing themselves to be the least equipped to guide the debate. Ignorance may be bliss, as the saying holds, but we need something more than "invincible ignorance" to shape our future.

Richard North 24/04/2017 link

Booker: the great unmentionables

Sunday 23 April 2017  

As usual when another election comes along, Booker tries to point out some of those hugely important issues which won't be getting discussed, because all the parties agree not to notice them.

The irony, in my view, is that although this is supposed to be the "Brexit election", the one thing that won't be discussed in any detail is the way we should be leaving the EU. At best (or worst), I fear that all we're going to get is a half-hearted re-run of the referendum campaign to the counterpoint of ritual cries about the Single Market.

Anyhow, high on Booker's list in this week's column is the energy future we face under the Climate Change Act, where our politicians have all happily nodded through a "decarbonisation" policy whereby we shall before long be phasing out all those remaining fossil-fuel power stations which still provide more than half our electricity, to rely instead on grotesquely subsidised "renewables" and imaginary nuclear power stations which show little sign of getting built.

Scarcely any MP has yet shown any sign of recognising what a disaster this is heading us for. The only mentions it is likely to get in coming weeks will be virtue-signalling manifesto references to the need for yet more unreliable renewables.

That is fair enough but, because of the EU links, this is probably a downstream issue – for the next election rather than this one – and then only after we have has a serious public debate on energy. For the moment, we have to concentrate on Brexit.

Even less mentioned, says Booker, will be the scandalous state of our "child protection" system and the family courts, as almost every month the number of children being removed from their families continues to break records, far too many of them for wholly inadequate reasons.

The only MP who ever properly recognised the nature of this tragedy was the Lib Dem John Hemming, who lost his seat in 2015, and it is now lost to view in the one place, Parliament, with the power to try to bring this corrupted system back to its original laudable intentions.

This, though, demonstrates the inadequacy of the electoral system. It is never going to be the case that the nation chooses a government on such narrow issues – no matter how worthy they are.

We need separate mechanisms, outside the framework of a general election, to be able to address such failures. Here, there is an excellent opportunity for The Harrogate Agenda, which would permit a referendum on the Childrens' Act, with a view to seeking its abolition.

Next in Booker's line of fire is public spending. This makes for his third unmentionable: our still soaring national debt, due to rise again this year, from a mere £316 billion at the turn of the century, to £1,829 billion – the interest payable on which, £52 billion, is alone way ahead of our spending on national defence.

We may hear much about those damaging "cuts", on everything from the NHS and care of the elderly to our schools and police. But how often are we told that public spending rose last year from £761 billion to £784 billion, and is due this year to hit £797 billion.

These are the figures supplied to Parliament for every MP to study, but since not one of them has any idea what to do about it, it's all best pushed under the carpet. And, if you are standing for Labour or the Lib Dems, you can just stick to complaining about those dreadful "cuts".

Finally, of course, there is Brexit, where all the indications are, from an increasingly stern Brussels and from the implications of Theresa May's decision that we should shut ourselves out of the single market, that we may end up in a situation much worse than most people yet realise or than what we have now.

It is always a danger sign, Booker says, when all our politicians agree on taking some great leap in the dark, without giving any proper thought to where it may lead; as it was when 463 MPs voted in 2008 for the Climate Change Act, without any of them asking how in practice we could cut down our "carbon emissions" by four fifths within 40 years without shutting down virtually our entire economy.

We similarly saw 494 MPs voting to send Mrs May on her way to Brussels, without having any idea what this may lead to. They have no idea that, in just two years, she will be able not only to agree a unique deal which somehow allows us to carry on trading with our largest export market and the source of 30 per cent of our food much as we do now.

Still less do our MPs have any sensible suggestions on how to sort out the thousand and one other issues needing to be resolved, from foreign and security policies to agriculture and fisheries: even how airliners from Britain can continue to enjoy free access to the "single European sky".

But, Booker concludes, at least she will be able to enjoy her huge election victory before some very uncomfortable realities begin to break in, and she will avoid having to face the country again in 2020, when the results of her negotiations are evident for all to see.

And it is then, when she has sorted those details that the truth of Brexit will emerge. Far from being a solution to our problems, it is just an enabler. After Brexit, Mrs May will not be able to hide behind "Brussels".

It is then that she will have to work out what is to be done about our suicidal national energy policy and how to pay the interest on a national debt which by then could have topped £2 trillion.

Richard North 23/04/2017 link

Brexit: a historical curiosity

Saturday 22 April 2017  

One of the side-effects of this referendum, it would seem, will be the next step in the decline and fall of Ukip. The party is broke, short of willing candidates and bereft of leadership.

Even their most prominent member, Nigel Farage, has done a runner, claiming he is more useful in Strasbourg and Brussels where, unlike in "easy win" Clacton, his tax-funded expenses will keep flowing.

In a move that no real political party would contemplate, Ukip is also considering having its people stand down in some seats currently represented by strongly pro-Brexit Conservative MPs.

There is also "keenness" among some Ukip figures for the party to stand aside in seats where a pro-leave Conservative MP is facing a close challenge from the pro-remain Liberal Democrats, in order not to split the vote.

Ukip is said to be preparing to present such a move as a principled decision to best secure departure from the EU. However, it would also save the party cash, allowing it to focus its limited resources on as-yet undeclared target areas.

But unlike previous general elections, there is no sugar daddy waiting in the wings with his pockets full of cash, ready to bail out impoverished candidates. The most recent of the party's big donors, Arron Banks, has gone AWOL and may even stand as a rival candidate in Carswell's former seat, while fending off the Electoral Commssion which is investigating his spending during the referendum.

With Ukip entering the election campaign deprived of its one and only MPs, and facing the prospect losing its entire corps of revenue-generating MEPs, the party's influence is on the wane. And not even its best friends believe it will make up its losses by gaining even a single MPs.

Farage's aim while he plays on the "stage" offered by the European Parliament, is to promote a "hard Brexit", the pursuit of which has become the holy grail of the "kippers". This they cling onto as their "vision" of ideological purity, for want of any more creative or intelligent ideas on how to manage the UK's exit.

More than anything, it is this refusal to engage in the practical realities of Brexit that is dragging the party down into the well-deserved oblivion that awaits it. The real job of managing the process of extracting ourselves from the European Union is being left to the grown-ups, while Ukip members whinge ineffectually from the sidelines.

In the longer term, the nation is going to have to get used to a new style of national politics, where Ukip is no longer a credible electoral threat, where Labour is in what seems to be terminal decline, where the Lib-Dems are picking up the protest vote and the Tories, for the time being, are all-powerful and sweep everything before them.

Although we've been there before, in the Thatcher years, many of the new generation of political wonks cut their teeth in the Blair years, and have seen only weak Conservatives governments since, lacking any clear ideology or commitment to Conservative principles.

Yet here we are, on the brink of what looks as if it could become a one-party state, even if the future of the Tories is entirely bound up in how well it manages Brexit.

Perhaps it could have been different, had Ukip worked up a realistic exit plan and sought to set the agenda for the next decade but, despite Farage's protestations to the contrary, the party has nothing useful or interesting to say.

After this election, though, we're unlikely ever to see the likes of the scenes photographed during the 2015 election (pictured), leaving generations to come to ponder over their political history books and to learn about the historical curiosity that was once UKIP.

There again, out of the ashes, another party could rise – but the days of yellow and purple are numbered.

Richard North 22/04/2017 link

Brexit: hard nuts in Brussels

Friday 21 April 2017  

Even though the draft negotiating guidelines from the European Council were pretty unequivocal, the "colleagues", it seems, have been working on a new draft which makes them even tougher.

This is according to the Financial Times which has seen a "non-paper" commenting on the new guidelines. As such, "non-papers" are usually published to "facilitate and structure discussion" and do not amount to formal proposals.

The FT itself tells of "small but significant revisions" to the original draft guidelines. But, to be more accurate, these are discussion points and clarifications offered by the Commission. There is no new draft as such.

Nevertheless, the newspaper believes the "non-paper" shows that EU Member States are happy to take a harder line on some issues than its negotiators originally suggested. In actuality, this reflects a hard line being taken by the Commission, but more in the form of tentative kite-flying.

Most notably, the Commission is challenging a UK requirement that EU migrants complete an 85-page form to prove that they are permanently resident in the UK. Guarantees of migrant rights "must be comprehensive, effective, enforceable and non-discriminatory" the document states. "Citizens should be able to exercise their rights through smooth and simple administrative procedures".

From "several diplomats", we learn that this call for "simple administrative procedures" was a direct reference to what are unnecessary bureaucratic hurdles that will make it harder for EU citizens to exercise their rights in Britain. "We've all seen that 85-page form", one senior EU diplomat tells the FT.

Another significant suggestion for amendment confronts one of the UK's supposedly most important "red lines" by including a more explicit reference to the ECJ and its role during a transition.

Any transition phase extending EU law would require not just the continuance of regulatory, budgetary, supervisory and enforcement instruments and structures, but also the EU's judicial oversight. The new draft also seeks to preserve the "autonomy" of EU decision-making at all stages, as well as "the role" of European courts.

One wonders whether Mrs May knew about this before her surprise announcement on the election and whether it influenced her decision. This is, after all, a dagger at the heart of her Brexit policy, ostensibly keeping the UK locked into the ECJ's jurisdiction until any free trade agreement comes into force – which could be years down the line.

Unsurprisingly, there is little enthusiasm in the Commission for establishing special judicial arrangements for the UK, just to cover the transition period. The UK will have to fit into the EU mould, not the other way around.

And having stabbed deep, the "colleagues" are intent on twisting the knife, demanding that the UK not only addresses the reste à liquider issue but also agrees to a "single financial settlement" which includes issues related to the European Investment Bank, development spending and contributions to the capital of the European Central Bank.

Not content with that, the non paper notes that the withdrawal agreement will need to address "potential issues arising from the withdrawal in other areas of cooperation, including security".

But the real bombshell comes in what the FT terms a "subtle edit". This downplays the EU's view of how soon it is willing to engage in discussions on an "ambitious" post-Brexit trade deal with the UK.

The original draft noted the EU was willing to start work on this before 2019, but the suggested text merely notes a willingness to discuss "an agreement on trade". This, apparently, is a deliberate attempt to lower expectations, leading one to suppose that, if adopted, team Brexit is going to find it hard going extracting a substantial agreement from the "colleagues".

Even then, the bad news isn't done. On trade deals in general, the Commission is suggesting that any new arrangements should not "endanger financial stability in the union, which is interpreted as a demand that the UK financial sector stays in line with European standards and potentially accepts some EU oversight.

That regulatory oversight, however, does not stop with financial services. The reference to social and environmental "dumping" in the original is also suggested for modification, with a reference to the need to tackle "unfair competitive advantages" including "tax, social, environmental and regulatory measures and practices".

As a final touch, the non-paper demands that the relocation of the European Medicines Agency and the European Banking Authority, currently based in London, be settled "rapidly". Britain will have no say in where they go, but there is some suggestion that the UK should cover the relocation costs.

Small wonder than that Finnish Finance Minister Petteri Orpo ventures the opinion that Brexit is inevitably going to be so painful that no one will want to feel it for themselves. He adds: "I believe it's going to be a precedent no one will want to follow".

And for all that, we have yet to see the final version of the actual guidelines, which are set to be approved on 29 April at a European Council meeting. But anybody who thought that the general election might buy us a temporary truce could be prey to over-optimism. The Commission seems determined to close down as many of Mrs May's options as they can.

This could make the Council an event of electoral significance if the hardest of the suggestions are adopted and they feed back into the campaign over here. Any sign of a stiffening resolve in Brussels is going to need careful handling, otherwise we end up with a bunfight that nobody can win.

Just for once, Brussels needs to realise that concessions cannot just go one way. To get something, they are going to have to give something. Playing the hard nut doesn't always work. However tough the nut is, one can always find a bigger sledgehammer.

Richard North 21/04/2017 link

Brexit: delaying the inevitable

Thursday 20 April 2017  

Given that some of them were voting for their own redundancies, you would have thought that more than 13 would have voted against a general election. But such is the obsession of the political classes with elections that, offered the prospect of a contest, 522 MPs piled in to give Mrs May what she wanted.

The immediate effect of this, however, is malign. As election fever takes hold, the political noise level increases exponentially while the information quotient drops almost to zero. Equally, the "colleagues" won't make much of a showing, knowing full well that anything they say now will fall on deaf ears.

And then we have in Jeremy Corbyn a leader of the opposition who seems unable to discuss anything of substance, except in terms of mind-blowing clichés, delivering "ten pledges to rebuild and transform Britain" which makes no mention of the EU.

Thus we have the bizarre situation where the so-called "Brexit election" will be about everything other than Brexit. And since we were getting little enough before Mrs May's Tuesday announcement, those anxious to explore the deeper ramifications of Brexit are going to be disappointed. They might just as well pack up and go home for the duration.

The irony here is that, after the election, Mrs May will claim that the vote (assuming she wins it) will give her the mandate she needs to continue the Article 50 negotiations, when it will do no such thing. The exit options will have been no better aired by 8 June than they have been to date.

This, though, is the time for ironies – witness the Guardian which has Stewart Wood tell us that: "May wants a hard Brexit without scrutiny. It’s Labour's job to stop her getting it".

Even if it was actually true that Mrs May was hankering after this suicidal course of action, it would be hard to find anyone in the real world who could deal with the idea of Labour performing as an effective opposition without breaking up into uncontrolled giggles.

But them, as the Guardian points out elsewhere, even with the best will in the world, it would be difficult for any opposition to perform effectively.

The election, the paper says, is an invitation to voters to buy Mrs May's Brexit terms sight unseen. She has declared that she wants support "for the decisions I must take", but we do not know what those decisions will be. It goes on to say:
They depend on negotiations that have barely begun with some EU partners who face elections of their own, as well as on events. All this will involve give and take. Mrs May is seeking a mandate to do something of which not even she knows the main planks, the details and the trade-offs. She wants to get parliament off her back in making the Brexit terms. This election must ensure that this does not happen.
There goes someone, an anonymous scribe, who really isn't of this world. This election – if it is to perform any function – is to get the electorate off Mrs May's "back".

What very few of the pundits seem to be doing is asking what the consequences for the Prime Minister would be if she didn't call a referendum just now.

Picking up on the very words used by our earnest scribe, we have a politician confronting the unknown where, at some time shortly before what would have been the next election, was going to be forced into making unpopular concessions to the EU. She would then have to turn to the voters and ask them to elect her party, so that she could spend the next five years in office, putting into action a programme with which her natural constituency would most probably heartily disagree.

This was a situation where, as a result of a bodged Brexit, we hypothesised, could arise the only possible circumstances where Jeremy Corbyn could actually win an election.

Any sanguine analysis, therefore, must conclude that the primary purpose of this election is to buy the Prime Minister more time to conclude negotiations before having to face the nation in a make-or-break election.

Even with the extra time, though, it is going to be difficult for Mrs May to square the circle – maintaining full participation in the Single Market while also giving the impression that she has broken free of the EU and is able to decide on immigration policy and other matters for which we supposedly sought to leave the EU.

Thus we have a politician faced with an intractable problem and it should come as no surprise that her response is to kick the can down the road. That is what politicians tend do when confronted with intractable problems.

At best, the extra time strengthens Mrs May's hand in the negotiations, reducing the pressure that comes with an imminent election. But despite that, she has only gained two years and that seems hardly enough. She could still find herself facing an incomplete settlement, having to fudge a messy transitional period that leaves us half-in and half out of the EU.

That is no more likely to be popular in 2022 as it would have been in 2020, in which case the only gain could be delaying the inevitable, when the electorate wreaks vengeance for a bodged Brexit and votes the Conservatives out of office for a generation.

That is the other side of the coin. There are few commentators who believe that this election will be anything other than a disaster for Labour, the immediate consequence of which will be the removal of Jeremy Corbyn as leader.

In 2022, therefore, Mrs May could find herself up against a reformed and strengthened Labour Party under a new leader, better capable of pointing out the weaknesses of her Article 50 settlement, ready to provide a lightning rod for public dissatisfaction.

That being the case, winning this election could be just delaying the inevitable. To survive, she need to use the extra time wisely, crafting a solution that will ensure we are fully out of the EU by the time she again goes to the electorate, with a sustainable relationship which will ensure the continuation of trade and other cooperative ventures.

And there lies the final irony for, if this is to be a central part of Mrs May's plans, the very last thing she can do is reveal it at this stage. Her "Ultras" and former Ukip supporters, contemplating moving over to the Tories, must believe this is a hard lady heading for a hard Brexit. Not one of them could handle the truth which, in Churchillian terms, must be protected by a bodyguard of lies.

Modern politics, though, is more sophisticated. With the media adept at hunting down obvious lies, our leaders lie by omission rather than by commission. And that turns modern political speeches, as Sam Hooper points out, into "nothing but soulless, prefabricated word clouds designed to deliver vacuous soundbites to a cynical public".

We're going to get a lot of those in this campaign, and very little else.

Richard North 20/04/2017 link

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