In praise of can-kicking

We’ve voted to leave the EU. What happens now? Well no-one is quite sure and that is already causing problems.

Early signs suggest that some businesses will respond by freezing recruitment, postponing investment and relocating jobs out of the UK. How much of this will happen is anybody’s guess but as the period of limbo drags on, it is likely that many firms will decide that life would just be easier for them somewhere else. This uncertainty, says Duncan Weldon, is poisoning our economy. Many economists are predicting a recession.

The trouble is, it is very difficult to see how this is likely to end. There are a number of options for designing Britain’s new trade relationships with the rest of the world but all of them have their problems. The Norway (EEA) and Switzerland (EFTA) models, while giving us access to the single market, would still allow freedom of movement which is what many Leave voters thought they were rejecting last week.  Beyond that, any option which restricted freedom of movement would almost certainly also involve restrictions on trade. Were these options put to a referendum, it is unlikely that we would get a majority for any of them. All of them will be unpopular for different reasons.

Whatever deal is hammered out with the EU will also take time. Anything which is agreed then has to be ratified by at least 20 member states. As this BBC graphic shows, there are a number of fences at which the deal could fall. Even the first one is proving hard to jump as British politicians, from both the Remain and Leave camps, insist they will not invoke Article 50 until they know what the deal will look like and EU leaders are saying they won’t start negotiating until the UK invokes Article 50. That is an indication of how the negotiations are likely to go.

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Given the standoff, it is difficult to see the process starting soon. David Cameron has already passed the decision onto his successor. It is likely that, whoever gets elected, will insist on seeking a fresh mandate before taking such a momentous decision, so we are probably looking at another election and the selection of new ministers before anything happens. Once the party conferences are out of the way and the Conservatives have organised a no confidence motion in themselves, which they now need to trigger an election, it will be getting close to Christmas. No-one likes autumn elections, especially not late-autumn ones. And after Christmas everyone is off skiing….

Well you can see where I am going with this. There are plenty of plausible excuses good reasons for putting off Article 50 until at least the spring of next year. Even then, it may be that no-one actually has the bottle to do it. As the ramifications of leaving the EU become clear, the thought of being the politician who took the final decision to wreck the economy might be too much even for Boris Johnson. As Janan Ganesh said, he and Michael Gove looked terrified after the result of the vote was announced:

[O]n the morning after the referendum, the two men wore the haunted look of jokers at an auction whose playfully exorbitant bid for a vase had just been accepted with a chilling smash of the gavel.

David Allen Green said last week that, the longer Article 50 is put off, the greater the chance that it will never happen.

The fact is that the longer the Article 50 notification is put off, the greater the chance it will never be made at all. This is because the longer the delay, the more likely it will be that events will intervene or excuses will be contrived.

As he said in his FT piece, there is now a stalemate:

Nothing can force the UK to press the notification button, and nothing can force the EU to negotiate until it is pressed. It is entirely a matter for a Member State to decide whether to make the notification and, if so, when. In turn, there is no obligation on the EU to enter into negotiations until the notification is made. There is therefore a stalemate. If this were game of chess, a draw would now be offered.

It is possible, then, that this may simply become a feature of British politics.

It is not impossible to imagine that the Article 50 notification will never be made, and that the possibility that it may one day be made will become another routine feature of UK politics – a sort of embedded threat which comes and goes out of focus. The notification will be made one day, politicians and pundits will say, but not yet.

It’s rather like West Berlin during the Cold War. The longer time went on without a Russian invasion, the less likely it seemed that there would be one, even though the threat was still there. Eventually the city went back to business as usual.

Until Article 50 is triggered, the UK remains a full member of the EU. We could therefore go on like this for some time. Britain may still be about to leave the EU in 2020.

None of the non-EU models look particularly attractive or would have majority support among the voters, so can-kicking might actually be the best option of all. Over time, as the possibility of leaving looks less and less likely, Britain will return to business as usual. The certainty of Brexit uncertainty will become the new normal. The longer that goes on, the more businesses will settle down and start recruiting and investing again. Many will decide that the aggro of relocating isn’t worth it after all.

So here’s to fudge, avoidance, muddle, procrastination and a bit of good old British pragmatism. It may yet save us from oblivion.

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39 Responses to In praise of can-kicking

  1. Alex King says:

    Quite a number of people seem to be suggesting more or less this. However, what would it mean for British participation in the European Council and Brussels administration? Cameron appears to have taken leave of the former and then left the others to decide amongst themselves what to do, and Commissioner Hill has resigned saying he cannot do his job. Rather than sort of remaining in statu quo ante, if this position continues, we seem to have de facto adopted something close to the Norway option: trade and labour movement, payment of dues and perhaps receipt of some benefits, but no legislative input. Attempting to continue participating in the Council and Commission would presumably raise very considerable difficulties over the validity of the decisions being made, wouldn’t it?

    • gunnerbear says:

      B****ks – there is a huge number of people who expect OUT to mean out……and if a group of metropolitan scum……..yes……..scum….think they can sit in the House of Commons and defy the will of the people…..well they might have a different view when those traitorous scum are up for re-election……….it’s really f**kin’ simple……are you with the majority who voted out or are you MP scum….?…for example my local MP who used to hammer the Outers has now decided that we should be out……and has left the Shadow Cabinet…..because 66% of their electorate voted out……………

  2. John says:

    I think you’ll find that Norway is EFTA, along with Iceland, Liechtenstein and Switzerland.
    EFTA countries (apart from Switzerland, which is still negotiating after 30+ years) are also in the EEA, which all EU countries are as well…
    Confusing…Especially as we leave the EEA when we leave the EU, and then try to find an open back door…to get back in….hmmm

  3. Much more quietly the Swiss had their own binding referendum on EU membership
    http://openeurope.org.uk/today/blog/swiss-told-to-vote-again-on-free-movement-except-this-time-the-stakes-are-higher/
    the usual EU fudge would be to wait a couple of months rerun the referendum and hope to get a different result. It is difficult to see how the EU could give Switzerland almost full access to the EU and not extend the same rights to the UK

  4. Duncan says:

    The Swiss had a referendum with the result that they reintroduced a quota system to limit free movement from the EU, but this has not been without consequences for them. https://en.wikipedia.org/wiki/Swiss_immigration_referendum,_February_2014

  5. Ken Munn says:

    Need an excuse worth at least 18 months? “It’s in the UK’s interests to wait until after 2017’s French and German elections, because the results of those might change the EU’s topography in our favour.”

    • Misha says:

      Which puts Hollande in a bind because he needs UK to suffer so Le Pen can’t stand on a Frexit platform

    • gunnerbear says:

      F**k ’em all – we’re out. That’s what we voted for……..

      • John says:

        I sometimes think that most thought they wanted to be out of a trade union in the UK. Google seems to think thst many Engs had little idea if what the EU is.

        • Dipper says:

          Every Leaver I know knew exactly what they voted for. And frankly I’m getting sick of Remainers thinking that they alone have the ability to tell truth from lies.

  6. heritagestanley says:

    I hope you’re right. We have decided, as a nation, to leave the EU. But we haven’t decided on what terms we leave. We can’t leave except on some terms. So until there is some national agreement about those terms we shouldn’t feel bound to press the Article 50 leave button. And it’s therefore helpful that the EU won’t talk to us about terms until we do press the button, because in the absence of such talks it will be very difficult to establish what would be acceptable to us.

    • John says:

      Oh well. Two routes: free trade = 4 freedoms. Non negotiable. No 4 freedoms = tariffs. They can’t give anything else or 27 states will want the same.

    • DragonMike says:

      Why should the EU hold informal talks? It’s clear what the U.K. wants, the influence and benefits without the costs. Informal talks are just about trying to get an advantageous negotiating position. Don’t underestimate how angry many europeans are (I live in Germany), they will happily let their governments make the U.K. squirm.

      • Dipper says:

        DragonMike – Why are they angry? We were repeatedly told that the EU is a club, the club has rules, and if we don’t like them we should leave. Well we are leaving. Seriously what is their problem?

        • DragonMike says:

          They percieve the U.K to have benefited massively in (net) economic terms, to have constantly been able to adjust the rules to it’s liking, take rebates, to have been the most enthusiastic supporter of free movement and to have disturbed many negotiations with it’s own parochial issues with EU membership. They see the U.K. as a single actor, there is a lack of understanding about the depth of the divisions within the U.K. I’m not saying I agree with them, but my perception is people won’t accept any deal which looks like Britain has got some sort of preferential access. THey are on the other hand a littel worried baout the EU (only a little):

          For the record – I can see both sides but voted remain as I don’t believe the core problems are down to the EU,

          • Dipper says:

            Thanks DragonMike.

            So why aren’t they happy? They don’t have to put up with us trying to pull the EU in a different direction? They can get on with the single idea at the heart of the EU and we can get on with being an ally and trading partner but not someone living in their house and complaining about the furniture.

          • Dipper says:

            I would also add that whilst the core problems may not have been down to the EU it was extremely hard to fix them whilst we were in it. Personally, as a Leaver, I think what we are seeing is really exciting. The vote was a massive shock to everyone, but the lesson that people living on low wages or benefits in distant parts need to be reconnected to the political process and their concerns addressed is being fully taken on board by the conservatives at least. I really think we are seeing a huge change in political outlook.

            The EU need to punish the UK for daring to leave just says in spades why we have to go. The Germans aren’t the only people who make cars. We can get them elsewhere. The EU risks making buying EU goods being seen as unpatriotic in the UK.

      • Dipper says:

        Is there a German equivalent of ‘cutting off your nose to spite your face’?

  7. You seem to have forgotten about these concerns by the end: “Early signs suggest that some businesses will respond by freezing recruitment, postponing investment and relocating jobs out of the UK. How much of this will happen is anybody’s guess but as the period of limbo drags on, it is likely that many firms will decide that life would just be easier for them somewhere else. This uncertainty, says Duncan Weldon, is poisoning our economy. Many economists are predicting a recession.”

    The extent this is felt is key, and not just in the brute FDI and GDP figures, but in sentiment. There are already stories of internships abroad being cancelled (because, I guess, why give the internship now to someone who will be a visa hassle later) and British scientists being taken off multi-year grant applications. And then there’s the soft cold-shoulder in Brussels you mention too – not invited to parties, coffees. De facto Norway as your commentator said.

    This will also fuel the rhetoric in Scotland, again to the extent that it’s felt by the voters. If people don’t notice a big drop – or can’t confidently attribute any drop – in number/opportunities/etc. then they’ll be happy to join the can kicking. But if they can be convinced this is a slow deflation, that American tourists getting Euros for their Dublin-Edinburgh-Copenhagen trip will be a help, that the EU is still keen to competitively deflate the Euro and spend on infrastructure projects in deprived Scottish regions, and that their parliament looks a lot more sensible than Westminster… Well I can see how the rhetoric could play out.

    • gunnerbear says:

      “And then there’s the soft cold-shoulder in Brussels you mention too…..” Then f**k the Europeans………f**k ’em………we won……..they lost…(not for the first time for the French who never won f**k all without UK support).

  8. Person_XYZ says:

    Gosh, leaving the EU looks really difficult and time consuming and expensive. Why did nobody predict this before now?

    • gunnerbear says:

      Actually it isn’t and it’s not………the highest ranks of the Civil Service are already reading a plan put forward by experts…… http://eureferendum.com/blogview.aspx?blogno=86121 Why do you hate the UK so much? Why do you show nothing but contempt for the Outers………

    • Dipper says:

      see my comment below about the difficulty

      As someone who has worked in Change Delivery quite a lot the most obvious route for our laws is to do a lift and drop. We can then amend at our leisure and judges can fill in any gaps to the best of their ability. We use judges to make laws all the time so can’t see anything to difficult here.

      Trade we can start of with WTO rules, and amend as we go by bilateral negotiation. This is going to be a lot easier than the alternative which is this: http://nessachilders.ie/2016/06/29/ec-chief-juncker-sends-appalling-signal-on-eu-canada-trade-deal/

      It is a measure of how much we have lost as a nation by being slowly suffocated by the EU that we are terrified by the prospect of operating as an independent state in the world. Negotiating deals, co-operating internationally, this should be meat and drink to the world’s 5th biggest economy.

  9. Dipper says:

    I’m a Leaver in a family of Leavers. One of the reasons for voting Leave is that although we now have some short term problems and issues, the long term looks much better as we do trade deals with the rest of the world and our culture becomes more go-getting. Whereas voting Remain would be fine now but all the pain is in future years as we get sucked into a failing European super-state with no influence and no means of escape. Most Leavers would like to get on with this for the reasons above and I expect it will happen at the first opportunity with the new leader.

    You Remainers have to understand that we cannot run the clock back to before the Referendum. The cat is out of the bag now. If we try to avoid leaving then the EU will absolutely hammer us as we have shown weakness and lack of confidence and we will be in the super-state with no influence, and the authority of the parliamentary system in the UK will have been completely destroyed with consequent social chaos and disorder to follow.

    If there is one thing that cheeses me off about Remainers its the habit of panicking whenever anyone shouts a threat. The negotiations for the UK to be in the single market, or, as I like to call them, negotiations to maintain tariff-free access for EU manufacturers to the UK market, are a case in point. We have a massive balance of trade deficit. One in 10 cars produced in Germany are exported to the UK. If tariff barriers go up then there will be a net move of manufacturing into the UK. And as for banking, If the rest of Europe was a proper place to do banking then they would be doing it there already – they have been trying for decades to undermine London as a centre. So they need a deal.

    The EU are a bunch of vicious bullies so we need to stand hard to get a decent deal and be prepared to go to the wire. Fortunately lots of other countries are sensing opportunities (see http://heatst.com/uk/11-countries-gearing-up-to-strike-trade-deals-with-britain/ although some of these look a bit lame) so I suspect that once German manufacturing unions see these negotiations making headway a deal might be forthcoming.

    • billbedford says:

      How the mighty are fallen. Where once Britain was know as the nation that had invaded 90% of the countries in the world it now finds itself bullied by a handful of bureaucrats.

      • Dipper says:

        Well I’m not about to defend the empire, but yes, decades of being in the EU and being told you can’t do this and you can’t do that have eroded our self-confidence and resolve. I think once the scale of the opportunities become apparent the country will flourish.

  10. It’s an amusing thought that Article 50 of the Lisbon Treaty might become the ultimate indefinite article as far as the UK is concerned, but the idea that our status in the EU can be preserved through stalemate, a constitutional Jarndyce and Jarndyce, is really not credible.

    Given the heightened expectation of Leavers (more are exulting in their newly-discovered power than experiencing buyer’s regret), any political party that offers to invoke Article 50 with immediate effect is likely to win a lot of seats at the next General Election. UKIP will hope they are that sole party, which will be enough to persuade the next leader of the Tories to make a similar commitment, or at least put a date on it.

  11. Duncan Innes says:

    Hmm. Perhaps in a few months time our new Prime Minister (or rather their Chancellor) will announce that they have come up with a set of 5 economic tests that must be passed before Britain is judged ready to take this momentous step in relation to the EU. Every 3 or 4 years thereafter, the Treasury can solemnly publish their assessment of these, each time announcing that while further progress has been made, the economy is still not quite ready.

  12. Pingback: Brexit tears | Alex's Archives

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