Brexit: a paucity of logic

By Richard North - May 23, 2021

The propaganda war on “fwee twade” continues in a desultory fashion in the Sunday media, in between the obligatory coronavirus news and the never-ending royal soap opera, with the BBC very much in the frame.

Somewhere in all that is also the Middle East cease-fire and the emergence of overt anti-Semitism in street demonstrations in London and elsewhere – to say nothing of the re-emergence of the dreaded Cummings. This means that Brexit news is at a premium and even the Australian trade deal is struggling to gain attention.

That we have seen a degree of sharp controversy though was hardly unexpected. Post-Brexit food costs, in relation to agricultural policy, were always going to be an issue, and I found myself addressing the issues several times on this blog over the years. And, from the way the subject was being treated, it was evident that the propaganda quotient from the “fwee twaders” would be high.

This article here, for instance, tracked the efforts by the Conservative think-tank, Policy Exchange, to bend the truth, painting a picture of sunlit uplands that were never going to be. At the time – this was August 2017 – I remarked that we were not going to get anything sensible from the Tory right on agriculture. And so it is turning out to be.

Earlier that year, there had been a determined effort to make a case that Brexit was going to cut food bills, with Owen Paterson claiming in the Sunday Telegraph that: “Brexit will cut shopping bills by £300 a year”. Once Britain was “free of the dead hand of the EU” people would benefit from “cheaper food” and a “genuine green revolution”.

Four years later, as we see prices in the shops inexorably rising, we do not see this claim repeated, although the ability of the UK to secure free trade deals with the rest of the world was held out as offering “a better deal for British families when they are shopping for food and drink, clothes, cars, electrical goods”.

Very little seems to have been said over the period about the benefits of these free trade deals to UK exporters, to the net sale pitch essentially relied on cheaper imports undercutting domestic prices, without being too specific about the consequences.

What we saw though, then as now, is the claim that price competition would root out “inefficient methods of production”, something which the Policy Exchange four years ago, and Ryan Bourne, formerly of the Institute of Economic Affairs, had in common.

Yet – as I wrote in my book Death of British Agriculture and again on this blog – it is the more inefficient methods which produce the most spectacular scenery, which underwrites a £12 billion rural tourism industry. It keeps the countryside populated and provides much-needed jobs.

Never mentioned by the “fwee twade” zealots is the singular fact that scenery has an economic value and that the beauty of much of the British countryside is a tangible by-product of farming, created by farmers, for which they receive no direct compensation.

It is, therefore, entirely legitimate for the state to pay farmers for the upkeep and development of this asset, and it would be wrong to call it a subsidy. If anything, it is the tourist industry which is being subsidised, as it does not pay for the asset on which it relies.

This is but one of the issue which should have been confronted before deals with major Agricultural producers such as Australia were even considered. But the fact that we are seeing commentators burbling about the effect of imports on “inefficient production” demonstrates that the ramifications of tariff and quota-free imports are not being taken seriously.

Only now, do we learn that Scott Walker, chief executive of NFU Scotland, is “reaching out” for formal discussions with Liz Truss, after complaining that her Australian trade deal of this sort would have “a huge detrimental impact on Scotland’s economy”.

This late hour, when the decision to go ahead with the deal seems already to have been made, is hardly the time for impact discussions – formal or otherwise. Policy should have been clearly set out long before Truss started negotiations, and she should have had a very clear idea of what was acceptable, without springing nasty surprises on UK businesses.

But the only thing which seems to have percolated Truss’s rather limited brain is the idea that a deal with Australia, along with the recently agreed UK-Japan deal, opens that way to membership of the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP). This would give UK exporters tariff-free access to eleven countries, which are claimed to account for around 13 percent of global trade (in goods) – as opposed to the EU’s 15 percent.

The theory is, as enunciated by the Express that the growing middle class in the Asia-Pacific region is expected to drive a nearly 1.5 percent annual increase per capita consumption of meat in the next decade. And UK producers will be able to benefit from this bonanza.

That UK producers will then be in direct competition with Australian and New Zealand exporters, who are closer to the markets, doesn’t seem to have been factored in, and there is also the problem of increased tensions with China, which are having significant repercussions on trade.

On the broader pitch, the Observer cites a Labour MP saying that: “The worry is that Liz Truss, in her desperation to keep the Brexit flame burning and the trade narrative on track, will rush to sign a deal with Australia that gives away all the UK’s leverage in future deals with other, much more important, nations”.

Needless to say, the certified cretin is in full flow. This is Hannan who, like his fellow zealots, is seeking to turn the controversy into a binary issue between “Europhiles” and the rest. This “handful of remainers”, he says, cannot let go and, like Jacobites, cling to what they know to be a lost cause because it is part of their identity.

Appealing to his own fanbase is a cheap and easy way of avoiding the issues, but it is also something of a nerve to complain that “Europhiles” are fighting on when the Eurosceptics continued the battle after the 1975 referendum and, for the most part, would have continued the battle had we lost the 2016 referendum.

Taking a swipe at the NFU, he argues that it “has an important job to do”. It is absolutely right, he says, to champion our upland farms. No one wants to see our loveliest countryside degraded. Thus, says Hannan, “a wiser NFU leadership would be working on ensuring that our systems of direct grants and subsidies go where they are needed”. That would “genuinely ensure a viable rural economy, in a way that trade protectionism simply won’t”.

And there we have what amounts to a strategy of blaming the victims. Agricultural and rural policy should have been settled before embarking on a programme of free trade deals. Ensuring that our systems of direct grants and subsidies go where they are needed, is government’s job, and one which quite evidently hasn’t been done.

As for Hannan’s obsession with Britain’s farmers getting their share of the world’s fastest-growing markets, namely those in Asia, I fail to see the logic of our enterprises exporting their produce halfway round the world, while our shops are filled with goods from even further afield, imported to make up the shortfall.

This seems even less logical when we are going out of our way to neglect the far larger market on our doorstep.