Brexit and the waning days of the United Kingdom

[Sheilbh]

Give them enough rope.

I think Starmer and the Labour party can safely work on policies for closing tax loopholes and higher taxation for the wealthy over the next three years; there will be an appetite for it by the next general election. Of course they will probably just spend the time arguing about anti-semitic grandpa 

I actually think this will happen regardless. There's several figrues in Biden's appointments who have written about the need for anti-corruption to start at home - global corruption is enabled by British, Luxembourg, Dutch, Delaware, Nevada corporate law. I don't know how much success Biden will have on state governments, but I think he could put quite a lot of pressure on (especially) the UK but also other European states.

The various dependencies and colonies have their own issues that need sorting but in the UK we actually have a lot of transparency compared with other countries. There's just no enforcing/monitoring/policing. Oliver Bullough who wrote Moneyland and has written a lot about global corruption said that in many ways the best system would be UK level of transparency with US level of enforcement/threat.

You guys fall for the obviously silly proclaimed ideas named for cresting a 800 million pounds purse to pay loyal chums from.

I think you overestimate the expense of UK corruption. Our politicians are far, far cheaper than £800 million

Also this already happens in a different way - Nick Clegg has that global role at Facebook now (and his former advisor has a role at Google). Plus all the lobbying firms who hire ex-minister/SpAds.

[Sheilbh]

So I thought the stories saying the French were being very hard-line etc were largely the UK government rolling the pitch to blame it on the French if there was no deal (which is probably quite attractive politically - either way there'll be disruption either you own it because it's happening despite your deal or you blame it on the French).

But the French Europe Minister has been on the radio this morning saying they will veto a deal if it's not right and he's since re-tweeted a clip of that just to make sure everyone gets the message. So I wonder if the stories about the French (and possibly other member states) worrying that Barnier has conceded too much are true

Of course nothing would be more pleasingly symmetrical than the UK's deal after they've left the EU being vetoed by the French

Edit: Also interesting polling from the Labour seats the Tories won on their opinions on political figures:

Two things stand out - one is Sunak's popularity (it's similar in Scotland, there was a recent poll and his opinion rating was higher than the Queen's ) and the other is how unpopular Patel is everywhere. Of course the Tory grassroots absolutely love her so she's going nowhere, but it's still really striking and quite funny.

[celedhring]

A hugely popular minister of finance? How does that work? 

[Sheilbh]

A hugely popular minister of finance? How does that work? 

Give out loads of money and be the only competent seeming man in government (including u-turning very quickly if he gets something wrong which is a useful political skill - especially as he rather elegantly knifed the health minister by basically saying his plans were based on the assumption there'd be a functioning test and trace scheme)

We'll see if it lasts on the way out of this mess. But I suspect it will - I think he's built up a lot of credit from people. I think Alastair Darling had higher rates of approval for a few years after the financial crisis than George Osborne because he was perceived as handling it competently.

[Zanza]

https://amp.theguardian.com/politics/2020/dec/04/uk-business-leaders-brexit-red-tape-tidal-deal?__twitter_impression=true

Both Make UK and the CBI have called on the EU to state whether it will reciprocate on some of the "flexibility" being shown by the UK, which has decided to ease in Brexit customs and regulatory checks over six months to mitigate disruption.

Remarkable that private lobby groups from a third country are calling upon the EU to act in their favour. Shouldn't they address their concerns to the British government, which is the party the EU actually negotiates with?

It was the British government which repudiated the Political Declaration, plans to break the Withdrawal Agreement, and thus moved the red lines, which made negotiations so much harder. It was the British government which decided to waste most of the Transition Period and not ask for an extension. It was the British government that did not prepare its borders or its businesses for the inevitable changes of leaving the Single Market.

There is no reason at all for the EU to show flexibility. The rules of the Single Market were well-known, even before the referendum. The full force of EU law should apply on this new external border starting from January 1st 2021.

[Sheilbh]

We know the influence British business lobby groups have on government policy on Brexit - it's zero

On the wider point on flexibility, you're right but in practice there are areas where the EU has provided quite clear guidance about what no deal means, in other areas there's not been that much clear guidance and so it's fine to say EU law applies as an external border - but what does that mean in practice, especially for SMEs that might not currently do business outside the single market. I think part of the vagueness has been political to be honest, but whatever benefit they're getting politically in my view is outweighed by the cost to business. I think that's why I've read pieces about member states pushing for the Commission to publish more details on no deal preparedness.

And there are some areas (especially some bits of the financial services sector) where theEU have unilaterally decided (like the UK on other issues) to sort of fudge the rules, because it's in their interests to do that - and in some cases they need to for financial stability reasons. It's all unilateral so the Commission or government could withdraw those decisions any time, but in the meantime the ECB and BofE have apparently worked quite well together (probably because they're all mature adults ).

I think this probably reflects David Edgerton's point in this piece: https://www.theguardian.com/commentisfree/2019/oct/09/brexit-crisis-global-capitalism-britain-place-world

Brexit is a necessary crisis – it reveals Britain's true place in the world
David Edgerton
A determined ignorance of the dynamics of global capitalism is bringing about a long-overdue audit of British realities
Wed 9 Oct 2019 06.00 BST
Last modified on Mon 3 Feb 2020 11.46 GMT

Who backs Brexit? Agriculture is against it; industry is against it; services are against it. None of them, needless to say, support a no-deal Brexit. Yet the Conservative party, which favoured European union for economic reasons over many decades, has become not only Eurosceptic – it is set on a course regarded by every reputable capitalist state and the great majority of capitalist enterprises as deeply foolish.

If any prime minister in the past had shown such a determined ignorance of the dynamics of global capitalism, the massed ranks of British capital would have stepped in to force a change of direction. Yet today, while the CBI and the Financial Times call for the softest possible Brexit, the Tory party is no longer listening.

Why not? One answer is that the Tories now represent the interests of a small section of capitalists who actually fund the party. An extreme version of this argument was floated by the prime minister's sister, Rachel, and the former chancellor Philip Hammond – both of whom suggested that hard Brexit is being driven by a corrupt relationship between the prime minister and his hedge-fund donors, who have shorted the pound and the whole economy. This is very unlikely to be correct, but it may point to a more disconcerting truth.

The fact is that the capitalists who do support Brexit tend to be very loosely tied to the British economy. This is true of hedge funds, of course – but also true for manufacturers such as Sir James Dyson, who no longer produces in the UK. The owners of several Brexiter newspapers are foreign, or tax resident abroad – as is the pro-Brexit billionaire Sir James Ratcliffe of Ineos.

But the real story is something much bigger. What is interesting is not so much the connections between capital and the Tory party but their increasing disconnection. Today much of the capital in Britain is not British and not linked to the Conservative party – where for most of the 20th century things looked very different. Once, great capitalists with national, imperial and global interests sat in the Commons and the Lords as Liberals or Conservatives. Between the wars, the Conservatives emerged as the one party of capital, led by great British manufacturers such as Stanley Baldwin and Neville Chamberlain. The Commons and the Lords were soon fuller than ever of Tory businessmen, from the owner of Meccano toys to that of Lyons Corner Houses.

After the second world war, such captains of industry avoided the Commons, but the Conservative party was without question the party of capital and property, one which stood against the party of organised labour. Furthermore, the Tories represented an increasingly national capitalism, protected by import controls, and closely tied to an interventionist and technocratic state that wanted to increase exports of British designed and made goods. A company like Imperial Chemical Industries (ICI) saw itself, and indeed was, a national champion. British industry, public and private, was a national enterprise.

Since the 1970s things have changed radically. Today there is no such thing as British national capitalism. London is a place where world capitalism does business – no longer one where British capitalism does the world's business. Everywhere in the UK there are foreign-owned enterprises, many of them nationalised industries, building nuclear reactors and running train services from overseas. When the car industry speaks, it is not as British industry but as foreign enterprise in the UK. The same is true of many of the major manufacturing sectors – from civil aircraft to electrical engineering – and of infrastructure. Whatever the interests of foreign capital, they are not expressed through a national political party. Most of these foreign-owned businesses, not surprisingly, are hostile to Brexit.

Brexit is the political project of the hard right within the Conservative party, and not its capitalist backers. In fact, these forces were able to take over the party in part because it was no longer stabilised by a powerful organic connection to capital, either nationally or locally.

Brexit also speaks to the weakness of the state, which was itself once tied to the governing party – and particularly the Conservatives. The British state once had the capacity to change the United Kingdom and its relations to the rest of the world radically and quickly, as happened in the second world war, and indeed on accession to the common market.

Today the process from referendum to implementation will take, if it happens, nearly as long as the whole second world war. The modern British state has distanced itself from the productive economy and is barely able to take an expert view of the complexities of modern capitalism. This was painfully clear in the Brexit impact sectoral reports the government was forced to publish – they were internet cut-and-paste jobs.

The state can no longer undertake the radical planning and intervention that might make Brexit work. That would require not only an expert state, but one closely aligned with business. The preparations would by now be very visible at both technical and political levels. But we have none of that. Instead we have the suggestion that nothing much will happen on no deal, that mini-deals will appear. The real hope of the Brexiters is surely that the EU will cave and carry on trading with the UK as if nothing had changed. Brexit is a promise without a plan. But in the real world Brexit does mean Brexit, and no deal means no deal.

Brexit is a necessary crisis, and has provided a long overdue audit of British realities. It exposes the nature of the economy, the new relations of capitalism to politics and the weakness of the state. It brings to light, in stunning clarity, Brexiters' deluded political understanding of the UK's place in the world. From a new understanding, a new politics of national improvement might come; without it we will remain stuck in the delusional, revivalist politics of a banana monarchy.

[Zanza]

Interesting article.

But as you say, the EU will unilaterally act in its own interests. Which is also the member states interests which is why they have a reasonable expectation to gain from these actions and inquire now what the plans are.

But British SMEs should just plan with current union law, which is clear,  and assume that the EU will not act in their interests. In case that happens anyway, they can consider that a windfall.

[Zanza]

Anyway, Barnier and Frost have stated a few minutes ago that there is no common ground between their mandates and have asked their political masters to align. Von der Leyen and Johnson will speak tomorrow. 

[Sheilbh]

Anyway, Barnier and Frost have stated a few minutes ago that there is no common ground between their mandates and have asked their political masters to align. Von der Leyen and Johnson will speak tomorrow.

Which sounds like it's either choreography for a deal (breakthrough call between the political leaders) or no deal - so just like the rest of the negotiations through 2020

[Tamas]

I am fairly certain Johnson will fold in the last moment like the UK has done during the previous stages. It would have the advantage for him that his party might keep him around longer in that case to have a fall guy for trying to weasel out of the deal's restrictions like with NI.

[Sheilbh]

I am fairly certain Johnson will fold in the last moment like the UK has done during the previous stages. It would have the advantage for him that his party might keep him around longer in that case to have a fall guy for trying to weasel out of the deal's restrictions like with NI.

I'm less certain - I've always thought people have generally underestimated the chance of no deal.

I think the politics are better for no deal. And I think Johnson's nothing if not a primarily political politician.

[Zanza]

Actually Von der Leyen is just the top bureaucrat of the EU. She has no own political discretion to move the EU red lines as these are set by the Council. So a call between her and Johnson either means Johnson concedes on the British red lines or they have to go back to the Council.

[Sheilbh]

Actually Von der Leyen is just the top bureaucrat of the EU. She has no own political discretion to move the EU red lines as these are set by the Council. So a call between her and Johnson either means Johnson concedes on the British red lines or they have to go back to the Council.

Sure but in terms of choreography it would be Johnson-vdL because we're not in the EU anymore. Last year, when we were still in the EU, it would be May at a European Council meeting.

And this will always need to go to the Council to be endorsed anyway.

[Iormlund]

If this has to go to the Council for anything else than rubber-stamping, it is doomed.

A year ago we said Brits overestimated their relevance in the European agenda. This is dramatically more the case now with Covid rampant. As far as most Europeans are concerned Brexit is long settled and forgotten. Nobody is going to bat an eye if this is confirmed to go to no Deal.

[Zanza]

https://www.consilium.europa.eu/en/meetings/european-council/2020/12/10-11/#

It's not even an agenda item of the next Council, although I guess the remark "In light of events, the European Council may address other specific foreign policy issues." might refer to Brexit.