Richard North, 28/12/2018  

It may be just a coincidence but yesterday brought another piece urging us not to be worried by a "no deal" Brexit. This one came from Quentin Letts, parliamentary sketch writer for the Daily Mail (and now Sun columnist). And he wants us to believe that "Brexit Britain will be just fine". It is "Europe", he says, that should be worried about its future. Doomsayers should hold their fire.

In times to come, if this is to be our fare for the next two weeks leading up to the parliamentary vote, we will probably be seeing a lot of this. But, even now, we can see emerging something of what might prove to be standard techniques.

As we saw yesterday with James Bartholomew, the trick seems to be to trivialise the issues, using emollient language. And, as you might expect from Quentin Letts, we see deployed a certain amount of ridicule.

But the common factor in both the Bartholomew and the Letts pieces is to characterise the "doomsayers" as part of the (out of touch) political classes, while the "electorate" is portrayed as being remarkably less concerned.

"The natural bias of news", said Bartholomew, "is towards star politicians and anything negative, which includes any news about problems with Brexit". And yesterday we had Letts reassure us that, "even if some instability does follow a no-treaty withdrawal, it would be short-term". Life would continue, he writes. "Chickens would continue to lay eggs".

Actually, Letts might just be a little over-optimistic in that assurance, as the intricacies of the egg market are such that the inability of UK producers to export their surpluses could have a devastating effect on the sector.

This, I explained back in January 2017, recounting how short-term surpluses on the UK market could drive down prices to such an extent that producers' losses could wipe out their entire annual profits. Fortunately for the industry, the UK demand cycle does not exactly match that on the continent. Thus, when the UK is in surplus and prices are low, there is keen demand in the rest of Europe and healthy prices.

Taking advantage of this, what then happens, on a more or less annual basis, is that the entire UK surplus is collected up and shipped to Europe, stabilising the markets in both areas. And, when the UK market is short, continental producers send eggs to us, once again having a stabilising effect.

Such transfers, while representing only a very small proportion of the overall egg trade, have a massively disproportionate effect on the industry, and can make the difference between profit and loss. Cutting off the European market could have a devastating effect on egg production.

But the one thing we find about the Letts article though is that it is almost completely a fact-free zone. Should there be any attempt by Brussels "to punish the disobedient Brits by preventing them exporting agricultural goods to the EU", he avers, this "might encourage the British government to find sudden reasons to stop the importation of German motor cars".

It really is quite remarkable how so much prejudice and ignorance can be piled into one sentence, shoehorning the idea that EU Member States would exclude UK produce as a form of punishment. How easily that myth takes root, and how hard it is to eradicate.

As to stopping the importation of German motor cars, one wonders how the German manufacturers of Rolls Royce limousines and of the best-selling Mini might react if that became a reality. But, one might ask how it could happen without the UK breaching WTO rules, and thereby provoking a costly trade war.

But, in the strange world occupied by Letts, he sees a "no deal" as having "tremendous advantages". It would, he says, "allow Britain immediately to negotiate and sign trade deals beyond Europe". Also, he asserts: "It would force May's government to cut taxes to make us more competitive. It would result in a tremendous boost to national unity".

Somehow, I guess that it would do little to foster any sense of national unity and, as for "signing trade deals beyond Europe", to what extent does that compensate for our dropping out of the trade deals negotiated by the EU. And how far do we have to go before we manage to replace trade with EU Member States?

But never fear. Letts believes that none of the doomsday Brexit predictions will come to pass. And when they don't, the EU will find itself in deep trouble. Our survival, and success without the bloc, he tells us "will highlight the intransigence of the Commission and may well tempt other EU members to contemplate quitting the troubled union".

Yet, if this represents the best that the "no dealers" have on offer, we should be encouraged. Even on a good day, the argument is so far from being persuasive that only the true believers would give it any mileage.

Far more dangerous, perhaps, are the likes of James Bartholomew who produces a patina of evidence which, to some, might look convincing. And, although I evaluated some of his claims yesterday, in a fairly robust review, I may actually have let him off too lightly.

Towards the end of the article which I reviewed, Bartholomew cites David Folkert-Landau, chief economist at Deutsche Bank, offering what purports to be an exact quote from the man. Enclosed by quotation marks, we are told that the man remarked recently, in respect of the UK and Brexit: "I am not at all worried about the UK whatever the arrangement because they're the most flexible country in the world".

When one has such precise citations to work with, it is a relatively easy matter to trace them to source via Google, but in this case a search produces sparse results, all of which lead back to Bartholomew. These exact words cannot be attributed to David Folkerts-Landau.

The closest one can find to a quote is not from Folkerts-Landau but from Iain Duncan Smith on 18 December, citing Deutsche Bank's chief economist, reproduced on Twittter by the Leave EU account. And this has IDS telling us that Folkerts-Landau said: "I'm not at all worried about the UK whatever the arrangement because they're the most flexible country in the world. I'm more worried about the EU!"

What Bartholomew is doing, therefore, is not citing Folkerts-Landau but citing IDS misquoting him, from an interview he had two months earlier with Bloomberg TV. Here, the man starts off by saying that the UK will strike a deal with the EU, but then goes on to say:
I believe there will be a price to pay, obviously, through the adjustment. I believe that over a twenty-year horizon, thirty-year horizon, the UK will do just as well or better than the European Union, but the adjustment is going to be painful.

I think it is immature to think that this is about two or three percent of GDP … It's about much more. It's a deeper issue that that, so I believe that, over longer, over a generational period the UK is going to come out looking just fine. The UK economy has a certain flexibility. It has it in its genes to do well, to be innovative. It doesn't have this bureaucratic construct that the Europeans have to struggle with and its got flexible exchange rates so I think that this will come out just fine, but there is a price to pay.
Any fair assessment of these remarks in their overall context would suggest that they do not support the view that the UK would emerge unscathed from a "no deal" Brexit, which is what Bartholomew is trying to convey. This man is breaking the most basic rules of journalism, falsely attributing a quote to somebody who never actually said the words, in an attempt to mislead his readers.

But if accuracy and honesty are in short supply from Mr Bartholomew, his employer, the Telegraph newspaper, is certainly not short of chutzpah. In today's edition, it gives space to Ryan Bourne, former head of public policy at IEA, the think-tank which sponsors Shanker "Snake Oil" Singham and which has made heroic attempts to distort and confuse the Brexit agenda.

In an authored piece, Bourne – speaking in defence of economists - is allowed to say: "Do not dismiss evidence, but consider it and ask where it comes from. Doing so may sharpen your own ideas for minimising risks and maximising the opportunities from leaving".

Applying that rule, if one determines that so-called evidence comes from the Telegraph, a very sensible thing to do would be to dismiss it, along with anything from the IEA. Ironically, neither have a scintilla of self-awareness but so long as both demonstrate an unrestrained tendency to perpetrate lies and misinformation, they should be treated as poison.

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