Brexit: poorer, but better?
By Pete North - June 17, 2020
It looks like the hardliners have comprehensively won the Brexit game. I don’t care to speculate whether there will be a deal or not since it makes little difference either way. In the time available and within the parameters set, any deal is going to be threadbare. Without the regulatory cooperation, for a great many exporters, a deal on tariffs is neither here nor there.
As much as this creates problems for exporters at Calais, yet to come is a shambles on the Irish Sea border which the government will then use to leverage modifications to the withdrawal agreements customs protocol. The usual suspects in the Brexit blob are looking at ways to wangle out of it entirely under a Covid pretext.
Of all the ways it could have been done, one can scarcely imagine a worse way of doing it. Even if all else goes well and our existing trade agreements elsewhere are rolled over, and with the addition of a US deal, the UK will still find itself substantially worse off.
Meanwhile it doesn’t look too promising elsewhere either. Today the government declared its formal interest in CPTPP, the Pacific regional trade agreement. Seven of the eleven members already have new generation deep and comprehensive FTAs with the EU (consequently so did we) so CPTPP without rolling over those FTAs is a net downgrade. Only two thus far have been rolled over. CPTPP is mainly a regional agreement on tariffs with investment and services provisions only marginally more sophisticated than the WTO baseline.
Ultimately it’s visa liberalisation and supplementary devices like recognition of qualifications which facilitate services where there is no regulatory harmonisation. That, though, is a moot point either way since flights to the region may prove prohibitively expensive thanks to Covid.
None of this is an argument for not doing it but with the EU essentially dictating the standards and regulations for the TPP7, it is unlikely to grow from the skeleton agreement it currently is. Between that and the trade gravity rule, my conclusion is a giant Meh. Window dressing to give meaning to the otherwise empty Global Britain schtick. It doesn’t matter if our trade policy is a success just so long as headbanger Brexiters believe it is.
Still, though, what’s done is done. The rest will all depend on what Tories believe they can do with investment deals and deregulation. We shouldn’t write it off but I’m a major deregulation sceptic since harmonisation is the essence of modern trade. It’s difficult to see how radical deregulation adds value, or indeed how much scope there is with most regulation we’ve adopted via the EU being the product of global obligations.
The thing is, none of this particularly changes my view that voting to leave was the right thing to do. I was under no illusions that Brexit would leave us worse off. There was never any need for us to make it worse but that’s entirely on the Tories, not Brexit. It remains the case, though, that the EU is deficient in all the ways we said it was and is still nothing approaching a democracy.
This biggest change is likely to be our regulatory culture which may have a profound effect on every sector, resulting in renewed public participation as lobby groups raise their respective concerns. It certainly makes for a healthier regulatory discourse instead of being largely passive recipients of EU rules. Though this does come with a substantial loss of export potential, but it is a gear shift in the economy and any seismic movements in that regard creates windows of opportunity. The test of Brexit will be “who for?”.
The success of Brexit, however, is only a pass or fail equation if viewed as entirely an economic proposition. Taken as a whole though, as a constitutional process, it’s just a marker in time where the British people reassert their sovereign authority. Only notionally though. There is a long way to go before we have a democracy to speak of.
Everything else will depend on what we do with what we’ve reclaimed, whether we allow things to continue drifting or whether we take back control from London. Brexit may have exposed the dysfunction in our political system, but Covid has now revealed the true extent of the dry rot in all the institutions.
Between the inept handling of Covid and the full scale moral retreat from the mob, Boris Johnson has been fully exposed as the lightweight fraud we knew he was. The only current merit to the Tory party is that they’re not Labour, but with each day that passes we learn the actual difference is minimal. Our fate is not now contingent on Brexit outcomes, rather it is what we decide to do collectively to remedy our enfeebled politics.
This is why it was a mistake for the Brexit insurrection to hand over the reins to Vote Leave Ltd and subsequently Boris Johnson. Had they a longer term vision and a plan, they could have maintained their movement and stood ready to push for change. Instead we are back to square one having to build a new insurgency from scratch. What that looks like and where it comes from is anyone’s guess but the Brexit blob look to have squandered the last of their electoral credibility.
One thing is clear, though, none of us can afford to wait for the Tories to get back in touch with their supposed conservative instincts. Nobody in their exhausted clan presents themselves as the kind of leader the country needs, not is our politics any longer capable of producing such an animal. The people themselves must get back into the habit of movement building.
The question, however is whether the country can hold out under the current malaise long enough to build a movement. It took at least a decade to get Ukip off the ground only this time around there is no EU to finance it. Ukip wouldn’t have got anywhere without its MEPs and the funding they attracted.
Our own preferred vision, The Harrogate Agenda, has struggled to permeate the noise being that we exist on the fringes but Covid alone makes the case for a return to real localism, underscored by the failure of a centralised track and trace system. With Brexit now out of our hands, having taken on a life of its own, maybe now is as good a time as any to pick it back up. If by the end of this turbulent time in history we can call ourselves a democracy again then, while we may very well be poorer, we might very well be better.