Believing Six Impossible Things Before Brexit


Alice laughed: “There’s no use trying,” she said; “one can’t believe impossible things.”

“I daresay you haven’t had much practice,” said the Queen. “When I was younger, I always did it for half an hour a day. Why, sometimes I’ve believed as many as six impossible things before breakfast.”

Alice in Wonderland

The noise to signal ratio seems even higher than ever on the Brexit front, so I hope I haven’t missed anything of importance.

Parliament tacitly accepts May’s run out the clock strategy. The overriding feature of the last few weeks is that Parliament, after a saber-rattling about “taking back control” not only appears to have fallen into quiet acceptance that Theresa May is driving the Brexit train, key members of what could be called the Resistance have shifted into cooperating with her “run out the clock” strategy.

Recall that May contrived to waste two weeks with her pretense that she could wrest concessions from the EU over the Irish backstop. Recall that the Government supported a motion on January 29 authorizing this obvious non-starter. Not only did EU Council President Donald Tusk’s spokesperson tweet seven minutes after Parliament approved the idea that the Withdrawal Agreement was not open for renegotiation, but as expected, other senior EU officials quickly affirmed Tusk’s position.

But it gets even better, or worse, depending on your point of view. It was cheeky enough for May to budget over two weeks of time for a certain-to-fail round of meetings and schedule her report back to Parliament for February 13, with a “Valentine’s Day massacre” predicted. There’s been virtually no Brexit business in the meantime.

Instead, according to the BBC, May’s next move is:

On Wednesday, Mrs May will ask MPs for more time to get legally-binding changes to the controversial Northern Irish backstop, which she believes will be enough to secure a majority in Parliament for her deal.

But the following day, Labour will attempt to force the government to hold the final, “meaningful vote” on Mrs May’s Brexit deal by 26 February.

Mind you, May was party to a joint statement that had some handwaves about aspirations but also included:

President Juncker underlined that the EU27 will not reopen the Withdrawal Agreement, which represents a carefully balanced compromise between the European Union and the UK, in which both sides have made significant concessions to arrive at a deal. President Juncker however expressed his openness to add wording to the Political Declaration agreed by the EU27 and the UK in order to be more ambitious in terms of content and speed when it comes to the future relationship between the European Union and the UK. President Juncker drew attention to the fact that any solution would have to be agreed by the European Parliament and the EU27.

Junkcer and May’s teams will keep talking and Juncker and May will meet again near the end of the month. Parliament is still acting as if the EU will rescue them. They won’t.

Moreover, some of the Tory MPs who had been maneuvering to block a “no deal Brexit” or secure a lengthy extension seem to be standing aside on May’s gambit. From the Guardian on Friday:

A crunch vote in which MPs could force Theresa May’s hand on Brexit is set to be delayed until the end of the month or even later….

Under the timetable agreed by the government, May must either present a revised Brexit deal to the Commons on Thursday, which appears unlikely to happen, or else table a motion to which MPs can add amendments.

In a similar process just over a week ago, the Commons supported May’s attempt to renegotiate the Irish backstop but voted down amendments tabled by cross-party alliances of Brexit-sceptic MPs that would have extended article 50 and given parliament more control.

It had been expected the MPs would try again on Thursday if May did not return with a deal. But sources close to the group, led by the Tory MP Nick Boles and Labour’s Yvette Cooper, said it seemed likely that the prime minister would be given more time to discuss a Labour Brexit proposal and hold more talks with Brussels.

The Ultras must be laughing their heads off. Everything is going their way!

It may be that the “take back control” types gamed out that any success could lead to a court challenge, which could create enough disarray as to raise the odds of a crash out. Or they may have been chastened by their loss last month and don’t want to try again unless they are sure they have the votes.

However, some Conservative MPs are still pressing for “mass resignations” as a way to force May to heel or to resign. But I don’t see May leaving office absent a vote of no confidence unless she is unable to fill ministerial posts after the next bout of departures.

Admittedly, the Guardian’s report on Boles’ acquiescence is inconsistent with this weekend account by Reuters:

An attempt by Labour lawmaker Yvette Cooper and Conservative Nick Boles to give parliament the power to request a delay to Britain’s March 29 exit was defeated by lawmakers on Jan. 29, but Boles said he would renew that effort on Feb. 14 if a deal has not been passed by then.

Labour’s “customs union” unicorn dies a well deserved death. The Guardian passage above mentioned “a Labour Brexit proposal.” Labour’s plan has been treated by too many people in the UK press as a viable alternative. It isn’t. It called for a “permanent customs union” as if that would be sufficient to create frictionless trade when it wouldn’t. On top of that, Corbyn maintained that the EU would allow the UK to influence EU trade policy….a concession the EU has never granted to any customs union member. More generally, “third countries” don’t play a role in rulemaking.

Our Clive and vlade were similarly not at all impressed. From Clive last Thursday:

Corbyn’s been gibbering away inanely this morning about what his beige lines are for supporting May and having followed, or tried to follow, the logic he’s using, I just can’t see how any voter could make head nor tail of what a Labour vote would be for (or against). And I’ve sat through PLP meetings where Party policy is discussed and formulated, for crying out loud.

Vlade’s reply:

Corbyn’s beige lines (I like!) are a joke. They are internally inconsistent (we want customes union but be able to negotiate our own trade agreeements! We want to be out of the EU but in the EU institutions!), which tells me that either they are irrelevant PR exercise, or Labour is clueless. Or both.

May sent a letter to Corbyn that amounted to a rejection but still allowed for the possibility of further talks.

Given the reaction on the Twitterverse to May’s response, it does not appear that Labour supporters will be mollified by that gesture, although the Financial Times put an awfully positive spin on it:

Theresa May has indicated her willingness to work with Labour to break the Brexit impasse, offering fresh concessions on workers’ rights and calling for further cross-party talks.

In a letter to Jeremy Corbyn, the Labour leader, the prime minister suggested legislation to enforce a promise to maintain workers’ rights and environmental protections after Brexit.

Mrs May also pledged a commitment to “asking parliament whether it wishes to follow suit” whenever the EU makes future changes in those areas.

Those promises could help persuade some wavering Labour MPs to back the government’s Brexit deal as fears rise of a no-deal departure from the EU.

But Eurosceptic Conservative MPs are likely to see the letter as an attempt to bounce them into backing Mrs May’s withdrawal agreement for fear of an even “softer” cross-party Brexit.

Some other outlets are spinning May’s willingness to keep talking to Corbyn as a major opening. Please. May is talking to the EU too.

But it is overwhelmingly Conservative-leaning outlets that are making much of the “jaw-jaw” offer, and this is to show disapproval.

Second referendum momentum fading. We’ve been skeptical about a second referendum, viewing it as implausible that the EU would give the UK a long enough extension to conduct one that complied with UK requirements (and rest assured, any attempt to cut corners would be challenged by Leave backers). It is also not clear how a referendum could be conducted so as to settle the Brexit question, given that “Leave” comes in many flavor, and Remain only one, plus some Leave options treated as available probably aren’t (the big fave of “Norway” has been ruled out by Norway, and their approval is necessary for the UK to join the Efta). And the EU no doubt has also noticed the problem of how to conduct a truly dispositive second referendum, which is another reason for them not to give a sufficiently long extension were the UK to make the request (the last thing they want is more faffing about).

Similarly, if the level of press and Twitter commentary is any guide, the push for a second referendum has lost steam. The latest sighing is from The Sun:

A Labour veteran who voted Leave plans to make a formal bid for a second referendum in the Commons next week.

Roger Godsiff says it was only right that the public should have the “final say” on the Prime Minister’s deal when it is finalised.

He will table an amendment to Theresa May’s “withdrawal motion” which is set to be debated on Valentine’s Day.

The move is understood to have infuriated campaign chiefs at the People’s Vote – who fear there is no chance of a second referendum bid winning a majority in the House of Commons.

Tory Remainers Sarah Wollaston and Philip Lee pulled a proposed second referendum amendment at the last minute last month under intense pressure from People’s Vote.

Even though the Conservatives are making much of the slacekening of second referendum momentum, a big impediment is that Labour isn’t backing it.

EU has given up on the UK. The EU had repeatedly said it would welcome the UK backing out of Brexit. However, the repeated attacks on EU stances and politicians in the UK press, the lack of preparation for talks and the repeated out-to-lunch demands, and most recently, the bad faith of trying to renege on the Withdrawal Agreement has sapped good will toward the UK within the EU leadership. Moreover, as some readers have pointed out, what happens if a sullen and divided UK were to rejoin the EU? Not only would it be at least as obstructionist as before, the frustrated Brexiteers would be scheming to revive the departure process, which means the rest of the EU would see the UK as having one foot out the door.

I had detected a cooling of tone toward the UK, and I have some company in that reading. From Chris Grey, on Donald Tusk’s infamous “special place in hell” remarks1 of last week:

But Tusk’s remarks were revealing of something else, far more uncomfortable for remainers for all that they may agree with his diagnosis of Brexiter vandalism. His comment was clearly unhelpful to their cause – for example, if there were to be another referendum it would be quoted endlessly – but as his other remarks made clear, he now regards this cause as a lost one.

The dynamic of the relationship between the EU and the remain campaign has been shifting for a while, and changed decisively once the Withdrawal Agreement was completed. From then on, for the EU polity, Brexit was a done deal. Remainers may be pro-EU, but the EU is no longer pro-remain. I don’t mean, of course, that there are not plenty of individuals, including politicians, in the EU who still hope that Brexit might be reversed. But the institutional logic has now shifted, and Tusk’s remarks are a reflection of this.

This is why Tusk seemed to take some pleasure in the knowledge that his remarks would wind up the UK press. Before, the EU took visible pains to remain silent at critical points so as not to appear to be trying to influence politics.2 The EU sees no need to observe such niceties.

Bad post-Brexit news keeps coming in. Even though EU short-term emergency measures in some critical areas like aviation and tourism will blunt some of the worst cliff effects in the event of Brexit, bad news keeps dribbling in. Airbus had already said it would leave the UK in the event of a no-deal Brexit; it said last month it was looking into accelerating those plans. Nissan cancelled its plans to build the X-Trail in the UK, despite large subsidies, citing Brexit as a concern.

Another sour development on the Japanese front: Japan the UK has not made enough progress on a new bilateral trade deal, and in the event of a crash-out, it won’t roll over existing terms it had via the EU:

From the Financial Times, which broke the story:

Britain and Japan have made little progress on a new trade deal in the past 18 months, according to officials involved in the talks, with tariffs set to revert to World Trade Organization levels at the end of March unless the UK ratifies a Brexit deal…

It is now too late for the Japanese Diet to ratify any agreement before Brexit is scheduled to take place on March 29. There is also a wide gap in expectations about a trade accord, which would apply either in the case of no-deal Brexit or at the end of Britain’s planned transition period, which is due to end in December 2020.

And here is the bit we had foretold: Prospective trade partners would see the UK as in a weak position post Brexit, both due to its smaller economic weight, as well as it having an urgent need to secure trade agreements. Only those who thought their existing treaty was particularly favorable to them would roll them over; everyone else would be tightening the screws:

Tokyo is confident that it can secure better terms from the UK than it did in negotiations with the much larger EU, and is not willing to duplicate the existing treaty precisely in either a bilateral deal or in talks for the UK to join the Trans-Pacific Partnership group. 

US companies have even roused themselves to discuss Brexit risks. From today’s Financial Times:

Corporate America is sounding an alarm over mounting Brexit risks, beefing up warnings to investors as boardrooms worry that a disorderly departure threatens international business…

In its “risk factors” published on Friday, defence contractor Lockheed Martin said a persistently depressed sterling after Brexit could “negatively impact the ability of the UK government to afford our products”…

While banks and other financial institutions had been preparing for Brexit for several months, she [Freshfields Bruckhaus Deringer partner Valerie Ford Jacob] added, companies in other sectors had been further behind.

In its annual SEC disclosure on Friday, Cadbury owner Mondelez said: “In the case of a hard Brexit, our exposure to disruptions to our supply chain, the imposition of tariffs and currency devaluation in the UK could result in a material impact to our consolidated revenue, earnings and cash flow.”

Cerner, a $18bn market capitalisation health IT company based in Missouri, said “limited progress so far in the negotiations” increased the possibility of the UK leaving without a deal and “significant market and economic disruption”.

Google parent Alphabet, while not spelling out the possibility of no deal, said it “may be unable to effectively manage” post-Brexit volatility in foreign exchange.

A post in Verfassungsblog (hat tip guurst) argues that Brexit is a constitutional crisis. I see the article describing important stress points, but, for instance, party allegiances being less clear-cut and rigid than they once were doesn’t rise to a Constitutional challenge but a party breakdown, particularly since the UK does not have a virtually-hard-coded two party system the way the US does. And a list that omits austerity as a trigger for loss of legitimacy and stress on the political system seems incomplete.

So perhaps we’ll still have a big blowup mid-February. But May is doing her level best to keep buying more time for herself, even as it becomes more obvious that her favorite ploy comes at the expense of the UK.

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1

And, per the Guardian:

During his press conference with Varadkar, Tusk also claimed there was a void of leadership at the heart of the remain movement and appeared to lament Labour leader Jeremy Corbyn’s failure to back moves towards a second referendum.

“At the moment, the pro-Brexit stance of the UK prime minister, and the leader of the opposition, rules out this question,” Tusk said. “Today, there is no political force and no effective leadership for remain. I say this without satisfaction, but you can’t argue with the facts.”

2 This may also have been Michel Barnier and EU Council members overcompensating for the two times that EU’s dim view of May’s utter lack of understanding of Brexit basics were leaked from dinners with Juncker with only a handful of other attended. The most popular view is that Martin Selymar was behind the leaks.

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