With friends like these…

A correspondent points me to two interesting perspectives on Brexit. The first is an American perspective by Steven Erlanger, the chief diplomatic correspondent for The New York Times, who has just completed four years as London bureau chief. The second is a twitter storm by Jonathan Lis on his discussions with unnamed Brussels staff, purporting to give an informed Brussels perspective on how the Brexit negotiations are going. Both authors can be viewed as broadly sympathetic to the UK cause, and yet this is what they have to say:

Steven Erlanger: No One Knows What Britain Is Anymore

Many Britons see their country as a brave galleon, banners waving, cannons firing, trumpets blaring. That is how the country’s voluble foreign secretary, Boris Johnson, likes to describe it.

But Britain is now but a modest-size ship on the global ocean. Having voted to leave the European Union, it is unmoored, heading to nowhere, while on deck, fire has broken out and the captain — poor Theresa May — is lashed to the mast, without the authority to decide whether to turn to port or to starboard, let alone do what one imagines she knows would be best, which is to turn around and head back to shore.

I’ve lived and worked for nine years in Britain, first during the Thatcher years and then again for the last four politically chaotic ones. While much poorer in the 1980s, Britain mattered internationally. Now, with Brexit, it seems to be embracing an introverted irrelevance.

Steven Erlanger: No One Knows What Britain Is Anymore

Mrs. May’s Conservative government is now so split that some Brexit supporters are calling on her to simply quit the bloc with no deal at all — probably the worst alternative for the country, but just the kind of populist, tub-thumping gesture favored by the Brexit elite and the right-wing tabloids.

Meanwhile, with the Conservative government so riven and rudderless, the old hard lefty Jeremy Corbyn is leading the opposition Labour Party back into an equally fantastical socialist past.

Britain is undergoing a full-blown identity crisis. It is a “hollowed-out country,” “ill at ease with itself,” “deeply provincial,” engaged in a “controlled suicide,” say puzzled experts. And these are Britain’s friends.

According to Erlanger

“The sense in the rest of Europe is bewilderment; how much worse can it get?” said Tomas Valasek, a former Slovak diplomat who lived in Britain for many years and now directs Carnegie Europe, a Brussels-based research institution. “After Brexit, no one is trying to help now. They’ve given up. Nobody on the Continent really cares that much about Britain anymore. Even worse, people feel the country will fall into the hands of Jeremy Corbyn and that will do more damage than Brexit itself.”

And this view seems to dovetail nicely with the Brussels insider viewpoint articulated by Jonathan Lis in his twitter storm summarised below:

Back from meetings in Brussels. There’s good news and bad news. First, the bad news. Because it’s… extremely bad.

While consensus in London seems to assume trade talks kick off in December, senior EU officials now consider this, on balance, unlikely.

Brussels monitors UK media & ministers’ statements – they can see PM has been backtracking since Florence – ie backtracking to cliff-edge.

Behind the scenes, also evidence that UK has reneged on guarantees for citizens that it initially signalled it would make. Really bad.

As for money, if May insists she can’t make any further commitments, EU will not trigger trade talks in December. It’s that simple.

EU went as far as it could in Oct. Nobody’s asking for precise figure, just specific commitments. €60bn the ballpark figure.

UK Government knows all this, incidentally. They’re in denial about it. But what happens if they test EU anyway?

If no agreement in Dec, next opportunity to kick-start talks is in March. That leaves 7 months to agree deal. They can’t, and won’t.

All of this means, we’re heading for crisis (and economic shock) very soon – December or January – unless UK comes to its senses.

EU fears May, when rebuffed in Dec through her intransigence, will retreat to comforting insanity of Redwood/Mogg Brexit utopia. BAD.

So senior EU officials now putting chances of no-deal at over 50%, and making detailed impact assessments about what it means for EU.

EU officials don’t think UK Gov working in national interest; worse, believe May & Davis don’t understand process, or what no-deal means.

EU unsure whether civil servants not telling ministers truth, or if ministers just aren’t listening- but UK incompetence is mystifying.

One official agreed that Davis’s recent remark on negotiations going down to wire, after EU Parl’t vote, was lunacy. EP vote is final.

Which brings us to the centrality of the misunderstanding. Brexit is a political, but far more importantly, a legal process.

Article 50 rules must be obeyed. Which means, everything must be agreed by European Parliament. And that means, everything.

So when Davis says that we’ll have a basic deal, on eg aviation, but without things we want, that must also be approved by EU Parl’t.

And here’s the thing: it won’t happen. EU conditions for deal are € above all else: if UK refuses to pay everything, no deal on anything.

If UK planning to leave hole in EU budget, forget about ‘deal no deal’, ‘basic deal’, or ‘orderly no deal’. No deal means no deal.

That means no aviation, drastically curbed radiotherapy. No transfer of nuclear material unless UK’s undergone exhaustive IAEA process.

EU thinks UK won’t easily be able to resurrect old aviation treaties, and a new one will take 2 years. This also requires goodwill.

EU also fears Gov won’t walk away, but just let clock tick – a no-deal by accident or incapacity. Followed by ‘bloody unreasonable EU’.

EU also not concerned about its own unity – in a crisis, officials think member states will rally round, not peel off. Unlike in UK.

This, regrettably, is not the only bad news. Let’s assume UK does come to its senses before December summit, and talks progress.

As Barnier’s made clear, there’s no bespoke transition. That means we have to stay in EEA, and to make that seamless, apply to join EFTA.

EFTA officials confident UK could apply to join EFTA quite quickly & provisionally apply agreement for Mar 19, seamlessly staying in EEA.

This, provided Norway & Iceland happy to let UK in for transitional period. But they would be under great pressure to allow it.

Might even be possible for UK to negotiate ‘associate’ EFTA status so doesn’t have to apply to join EFTA’s trade deals (big concession).

Only… Northern Ireland is ruined, because off-shelf EEA agreement excludes agriculture. Which means full WTO tariffs. No ifs, no buts.

EEA Agreement Article 19 provides framework for agri liberalisation- but needs to be negotiated from scratch. Norway’s deal took 2yrs.

So Davis was right to say, last Tuesday, that new tariffs would be ‘a real problem’ for NI. It’s a problem he’s determined to make real.

So, I hear you ask, where’s the good news? Easy. If UK wants to extend A50, or revoke it, just say magic word. Even at last minute.

Can negotiate new aviation treaty, new agri provisions to top up EEA, or a new trade deal, while comfortably still in EU.

Senior officials describe difficulty of UK participating in EU elections as ‘lowest priority’. Avoiding cliff-edge much more important.

EU doubts PM has authority to pull this off. Easier for her to drag us off cliff than show humility/common sense. But there’s still time.

It’s not too late to see this cliff-edge & prevent what’s otherwise an unavoidable catastrophe. All they need to do is open their eyes.

That was the news. If anyone’s friends with Theresa or David, please let them know.

Even allowing for some position taking and scene setting by the EU officials, this is pretty grim news for the UK, particularly the bit about the EU officials putting the probability of a no deal Brexit at over 50%. These things can all too easily develop a momentum of their own and become a self-fulfilling prophecy. Why take a risk and make a big concession which might create a dangerous precedent if the whole thing is likely to go up in smoke anyway?

The only surprise (for me) in the comments attributed to EU officials, is that they regard the A50 invocation as revocable, even up to the last minute. However if that is what you really want – to persuade the UK to revoke its A50 notification – then you have an incentive to make the Brexit negotiation process as nasty and unproductive as possible. Why make it easy for the UK to leave, if you really want them to stay?

This is not a view shared by Wolfgang Münchau, who argues that revoking A50 is unlikely to be possible, and that the only sane route for Brexit is taking the Norway option.

The number of newspaper comments calling for, or even predicting a revocation of Brexit is close to an all-time peak. The one prediction I am confident to make is that their number will rise as we approach March 30 2019.

I think this is a shame. Pro-Europeans are wasting their energy on a futile tactic. A much more fruitful strategy would be not to try to undo Brexit itself but Theresa May’s Brexit blueprint: the departure from both the single market and the customs union.

It is far from clear, in any case, whether it is possible to revoke Brexit. Even if it was, the EU would attach conditions that would be hard to accept for the UK – such as a permanent end to the British rebate, and a political commitment from the two largest parties not to invoke Brexit until the end of the next parliamentary term.

Münchau argues that a trade deal is unlikely to give the UK the access to the Single market for services it so craves:

But the real obstacle to Canada-plus is not legal but political. From the EU’s point of view, the single market is binary and non-divisible. You are either in the whole of it or in none of it. There is no such thing as the Swiss option unless you are Switzerland. I always cringe when I hear UK politicians talk about access to the single market. There is no such thing. You are either a member or not.

So even if the Brexit talks do move on to trade after December – as Münchau thinks they will – this will not prove to be plain sailing for the UK. The Canada deal will be about as good as it gets, unless the UK decides to join the EEA and take up the Norway option. At which point there will be another wrangle about how much the UK should pay to remain part of the Single Market and Customs Union.  

This one will go down to the wire, but I expect the EU to extract a heavy price. The European Parliament and 27 member states have a vested interest in ensuring that the UK’s departure does not leave a large hole in the EU’s budget. Which national parliament is going to vote for their country to make up part of any deficit left by the UK’s departure? My money is still on no deal.

Author: Frank Schnittger

I resist categorization and prefer evidenced based and reasoned debate to the received wisdom of any political position. My home page and diary index is here.