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Sunday, 16 February 2020

Brexit is a crisis, not an opportunity. But we’ll see that too late (Guardian)

The Guardian title: Brexit is a crisis, not an opportunity. But we’ll see that too late

Guardian subtitle: The language of Leave is already shifting from optimism to realism, but awareness of what awaits us is dawning too slowly

Author: William Keegan, the Observer's senior economics commentator

Date: 9 February 2020


"The prime minister tells us he wants to bring the country together. This is rich from the politician who made a major contribution to tearing it apart.

In theory, Johnson is monarch of all he surveys: the British political system resembles, in Lord Hailsham’s famous phrase, an elective dictatorship. And Johnson already manifests dictatorial tendencies.

We Remainers have lost. Great Britain has officially left the European Union (it is not at all clear that Northern Ireland has). But, in fact, Brexit has only just begun.

In his acceptance speech when recently being awarded the Olof Palme prize in Stockholm, my good friend John le Carré noted that the shabbiest trick in the Brexiters’ box was to make an enemy of Europe.

He added: “Don’t blame the Tories for their great victory. It was Jeremy Corbyn’s Labour party, with its unpolicy on Brexit, its antisemitism and student-level Marxism-Leninism, that alienated traditional Labour voters and left them nowhere to go.”

There is much discussion in innumerable postmortems about what went wrong: Labour’s loss of touch with its heartlands and so on. But Le Carré has captured it in that one sentence. Labour lost because it had disastrous leadership; and, alas, from what the people in control of the party machine still seem to believe, there is a danger that, like the Bourbons, they have learned nothing and forgotten nothing.

Both our main political parties have let the country down: Labour because of its disastrous mismanagement of a once great movement; the Tories because the 2010 policy of austerity was unnecessary, misconceived and terribly damaging.

Labour should have been there to repair the damage. But, like Captain Oates, they have gone outside and may be some time.

We are therefore landed with a Conservative party led by an opportunist I distrust so much that I should not want to go anywhere near the jungle with him. At his birth, Johnson was blessed by a mischievous fairy with such a Teflon carapace that, although a longtime resident of the metropolitan Islington so despised by voters in the Midlands and the north, he – and for that matter his fellow Islingtonian Dominic Cummings – escape the cheap criticism levelled at Corbyn and co. They were on the ropes before the opposition parties agreed to that one-issue election; but the opposition was fatally divided, so the Conservative and Brexit party, representing a minority of the nation, won with the help of our first-past-the-post system.

It is likely to be a slow-burning crisis, and the real culprits will continue to blame the EU

However: we are where we are, and people keep telling me I should try to be constructive – make the best of it even though, in common with most economists, I think Brexit is the biggest economic crisis of my professional career. Frankly, it is difficult to be optimistic.

To put it bluntly: what government in its right mind would say goodbye to more than 70 advantageous trade agreements and start all over again? Answer, this government. Again: what government would wish to disrupt the smooth non-tariff barriers afforded by the single market, painstakingly negotiated by Margaret Thatcher, in order to risk queues at the ports and needless disruption to our way of life? Answer: the very same.

So what hope is there? As Anand Menon, director of the thinktank The UK in a Changing Europe, recently pointed out, the tone of this Brexiter government has changed from proclaiming that Brexit is “full of opportunities” to acknowledging that it is “a problem to be managed”.

The problems are so overwhelming that most trade experts conclude Brexit cannot be negotiated within the agreed timeframe of one year; the odds are that we shall crash out of the customs union and single market without anything resembling a sensible deal.

Michael Gove, who has a central role in handling negotiations with our former partners, tells us that if anything goes wrong people can no longer blame the EU. From now on we are on our sovereign own!

Oh yes? I wonder. It is likely to be a slow-burning crisis, and the real culprits will continue to blame the EU. We shall remain in the customs union and single market for the rest of this year. Uncertainty will persist on many fronts, and almost certainly continue to delay private investment. But the EU will, rightly, not relent in its insistence on regulatory alignment, while Johnson and co refuse to abandon their obsession with seizing control. An irresistible force meets an immovable object.

I suspect that people will gradually wake up to the absurdity of Brexit as it begins to affect them in different ways. But by then it will be too late."

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Source: https://www.theguardian.com/business/2020/feb/09/brexit-crisis-not-opportunity-see-that-too-late

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