Theresa May is back in Brussels battling with EU leaders in an effort to put the Brexit negotiations back on track. But whose track is that?
The problem right from the start of these talks has been a twofold one.
First, there is the apparent lack of reality on the UK side about what the EU wants out of the Brexit process. Secondly, there is the political weakness of the Prime Minister, whose divided cabinet is riddled with Remainers and whose government can barely command a majority in the House of Commons.
All of this has led to Mrs May staking everything on being able to trumpet that she’s “done a deal” with the EU – no matter how much she may end up giving away in the process. Moreover this obsession with doing a deal is to look at Brexit through the wrong end of the telescope.
The important thing is that proper Brexit is delivered – not the appearance of Brexit.
In recent weeks, we have seen evidence of increasing desperation on the part of Mrs May and her government. In Florence, May offered concessions on the EU budget by promising to pay an extra two years’ worth of EU budget contributions up to the end of the EU’s current long term funding cycle at the end of 2020. This was despite there being no legal obligation on the UK to do so. It also came in the face of the continuing obstructionism, intransigence and bullying that have become the hallmarks of EU negotiating tactics.
Today, we learn of an open letter being sent by Mrs May to EU nationals in the UK.
All of this smacks very much of a Prime Minister who feels she must keep making the first move, to keep the prospect of a deal in play – no matter how unreasonable and intransigent the EU has been.
What is so frustrating is that none of this is necessary. The UK’s position is far stronger than the Remainers and the EU would have us all believe. We can leave with no deal and start enjoying the immediate benefits of Brexit – free and back in control. As Roger Bootle and many others have argued, we have nothing to fear from such an outcome. The screams and scaremongering from Remainers about the perils of “no deal” is simply a repeat of Project Fear – and about as convincing.
EU still wants to punish Britain
When she triggered Article 50, the PM was warned by none other than the former Greek finance minister that allowing the EU to dictate the terms of the Article 50 negotiations would be a recipe for disaster. Yet she agreed to the EU’s demand that initial discussions be limited to just three issues – the Brexit bill, NI border and EU citizens’ rights. Only if sufficient “progress” was made on those issues, so the EU insisted, could talks move on to the far more important subject of trade.
In the event, this has all worked out exactly as the EU intended. The pressure has built on the UK to offer concessions on these matters because – correctly – EU leaders have assessed that May is weak and desperate to reach a deal. We can expect them to keep turning the screw now they think they have May where they want her.
The point is of course that the EU has no interest at all in giving a favourable deal to Britain. On the contrary, they want to put our head on a proverbial pole and make an example of us so as to deter any other Member States from following suit. If Britain is shown to have suffered by leaving the EU, the hope in Brussels is that they will still be able to use fear to keep the other countries in line. By contrast, if Britain were to thrive after it has left, the writing would be on the wall. Populist politicians in other EU states would soon be campaigning for their own countries to come out. The dream of “ever closer union” would be in tatters.
So when Theresa May keeps talking up the idea of a “special partnership” and David Davis talks about how “constructive” his talks with Mr Barnier have been, the reality is that they are pursuing something that is never going to be voluntarily on offer.
The EU will never – voluntarily – offer terms that are anything but lousy for Britain. Only if it is forced to make a pragmatic compromise will there be a semblance of a deal that we can and should accept.
No doubt some in Brussels harbour hopes that the more difficult they make things, the more chance there is that the government could fall and the UK will end up giving up on Brexit altogether. But if that doesn’t happen, the EU has two very obvious objectives.
First it wants to screw as much money out of the UK as it can in order that it can go on spending and won’t have to ask other states to make up for the huge gap in funding that would otherwise be left behind by a departing Britain.
Secondly, the EU will do what it can to tie the UK’s hands, post-Brexit. The aim of this will be to stop the UK reaping the full benefits of its new found freedom. Brussels will want to stop the UK undercutting the EU on taxes and regulation or doing deals with other countries – the very things that make Brexit – economically speaking – worth doing. Talk of a “transition period” epitomises this.
The way things are going, the UK is simply going to end up being dragged along by its nose and kept in permanent orbit around the EU. As Boris Johnson has rightly pointed out before he was shouted down by the Remainers – that would be the worst of all possible worlds.
So the key question is how do we force the EU into a position from where it has no choice but to offer us a reasonable deal, but one that still delivers on the essentials of Brexit?
Time to make a stand
Theresa May and her government (which is full of Remainers), too often gives the appearance of being scared of leaving the EU without a withdrawal agreement. The desire to cling on in a transition period illustrates this.
What she needs to do is make clear to Brussels that the UK has gone as far as it can in relation to the three pre-conditions of NI, citizens rights and the “Brexit bill”. We cannot and will not agree to pay anything to the EU after we have left, except possibly as part of an overall deal. Agreeing payments now, as the EU is demanding, is impossible.
The message should be that if the EU still insists on our making such a commitment before it will talk about the future, we will have no choice but to withdraw from further talks and work on the assumption that we leave without a deal in March 2019. Full and serious preparations need to be made and publicised to prepare the country for “no deal”. This cannot be a bluff. It must be real.
Pressure on EU
If the UK adopts that stance, then the EU will be faced with an unpalatable situation.
First, as of March 2019, it will no longer be receiving any money from Britain. So it will have to immediately revise its financial budgeting for the remainder of the current financial framework period up to the end of 2020. That will be painful and difficult because no other states will want to pay more than they already do. The UK’s offer to pay another two years’ worth of contributions will suddenly look very attractive indeed.
Secondly, for EU exporters, the nightmare prospect is that the UK will free up trade with other countries and the tariff-free access EU exporters have enjoyed in the huge UK market will disappear. EU producers will face stiffer competition from US, Australian, Japanese and other goods without the tariff advantage they have previously enjoyed. The main European economies of Germany, France, Italy and Spain all run trade surpluses with the UK. They stand to lose much.
And this is the EU’s catch 22. It wants to punish Britain. But if it does, it will inevitably hurt the economies of its own member states in the process. Sure, Britain will suffer too, but the pain will also be felt in Europe. That will do nothing for the EU’s popularity as jobs are lost and livelihoods destroyed – all to keep the EU’s vanity project on track and to spite Britain.
Wiser heads are likely to prevail when faced with the unattractive consequences of a punishment approach to Britain. But they won’t be heard as long as the UK keeps giving in to bullying and making concessions.
Don’t do it May
May is under pressure from Remainers who have foolishly whipped themselves up in a frenzy about the supposed perils of a no deal exit. It is as though she sees a deal with the EU as almost an end in itself, her political salvation perhaps, rather than a means to an end. The danger is that if she keeps giving away more and more concessions, she and her Remain colleagues, together with the Remainer civil service, will end up tethering Britain to the EU in the worst possible way.
The Brexiteers were correct to demand that Mrs May walk away from talks.
The fear is that her desperation to “to a deal” could ruin Brexit. It must not be allowed to happen.