Brexit: The endgame (update)

Prediction is a mugs game, but, watching the Brexit trainwreck, I can’t resist. Over the fold, my predictions from mid-December. So far, everything has gone as I predicted, but I didn’t anticipate how badly May would be defeated, or how strongly Parliament would reassert itself.

I now think that the “No Deal” option will be off the table sooner rather than later. Either May will capitulate to Corbyn’s demand or Parliament will force the issue somehow.

That makes revocation of Article 50 the default option, so that a strategy of running down the clock makes no sense for Brexiteers of any kind. Still, I think May will keep stalling because that’s what she does.

Now, I suspect the approach of 29 March will work a bit differently. Rather than unilateral revocation, May and the Conservatives will want an extension, which requires the consent of the EU27. To get that, they’ll need to offer a prospect of finality. Since a general election is unlikely to appeal, a second vote is the last option standing.

The question is: what will be voted on? It’s clear that Remain (that is, unconditional revocation of Article 50) will have to be one of the options. On the other side, there’s May’s failed deal with the EU (possibly tweaked further in the interim) and No Deal. Given that the Brits don’t understand preferential voting, my guess is that one of these will be ruled out. From a procedural perspective, I think the fairest choice would be the clearest. On the one side, reverse the result of the last referendum. On the other side carry it through regardless of what the EU thinks.

To be clear, “No Deal” doesn’t really mean that. A literal no deal would see Britain reduced to food rationing in a matter of weeks, air travel cancelled immediately and so on. In reality, “No Deal” means a series of emergency deals, cobbled together in circumstances where the EU faces significant but manageable economic costs, while the UK faces catastrophe. My guess is this would imply, for example, that EU airlines would ensure that air travel continued, but that British airlines would get short shrift. Perhaps the British side could call in Donald Trump, master deal-maker, to help drive a better bargain.

Repost from December

On 29 March this year[1,2], if nothing else changes, the UK will leave the European Union under the terms of Article 50. Unsurprisingly, lots of scenarios are being scripted, but the one I see as most likely doesn’t seem to be among them.

I expect that nothing much will happen until about 28 March. May won’t get a deal that can pass through Parliament. If she allows a vote at all, it won’t be until late January and it won’t pass. At that point, or possibly before, Labor will try a motion of no-confidence which will also not pass. There will be a push for a second referendum, but that will be stymied by the fact that the current law requires a minimum of 12 weeks to hold such an exercise, and that will be too late. There may also be an attempt to get an extension of time for the Article 50 notice, but at least one of the EU27 will find a reason to block it.

May will keep stalling for time, as she has done since taking office, until the deadline approaches. At that point, the ports will start to clog up, as shippers try to move goods across the channel before the No Deal exit. There will be attempts to negotiate temporary “No Deal deals” to smooth the flow, but they won’t go anywhere. By March 28, or maybe a bit earlier, panic buying will empty supermarket shelves and stockpiles of medicine.

At that point, the prospect of NO Deal will become too terrifyingly real to contemplate and there will be only one option left. Britain unilaterally revokes its Article 50 declaration, and everyone agrees to forget the whole sorry business.

Feel free to point out plot holes, or suggest your own script.

fn1. Rather less momentously, I will turn 63.
fn2. It’s generally good to be cautious about revealing your birthdate online. But mine is on Wikipedia, so I guess there’s no harm in that.

30 thoughts on “Brexit: The endgame (update)

  1. Either May will capitulate to Corbyn’s demand or Parliament will force the issue somehow.

    Somehow? But how? It seems more and more to me as if the whole history of Brexit has consisted of people unrealistically believing that if only they declare what they want forcefully enough it will happen ‘somehow’. How confident are you in the level of understanding of UK MPs about how things work?

    If there’s a majority of the House of Commons in favour of revoking the notice of withdrawal, they can prevent a no-deal Brexit by forcing through such a revocation. However, if there’s a not a majority of the House of Commons in favour of doing that, there’s no alternative procedure available that guarantees prevent of the ‘withdrawal without an agreement’ scenario. The Opposition want the Government to guarantee that there will not be withdrawal without an agreement. However, the only way the Government can guarantee that won’t happen is by undertaking that if no agreement is reached they will revoke the notice of withdrawal. I don’t think Theresa May is prepared to make that undertaking.

    Now that the Government’s proposal for a withdrawal agreement has been rejected by the House of Commons, there’s a statutory requirement for the Government to make a statement to the House about what they propose to do next. I think it’s easily possible that the proposal will be something foolish and futile, but also that the response of the House will also be foolish and futile, and we’ll have another nine and a half weeks of foolish and futile manoeuvring producing no outcome and a withdrawal without agreement happening not because there’s a majority for it but because nobody can cobble together a majority for any single clearly stated alternative proposal.

    Anyway, Theresa May has said that the Government’s proposal will be made on Monday (UK time), so maybe things will be slightly less unclear after that.

  2. Brexit, as a strategic move, presents tactical difficulties as Theresa May is now finding out. There is no way to Brexit without tactical difficulties. But Theresa May’s plan of action was and is incorrect. She gave the EU the upper hand in bargaining. The No Deal, Hard Brexit, path was the correct path to threaten up front. Then, wait for the EU to blink and offer a concessional deal. If they didn’t blink then be prepared to walk away as threatened and default on all EU bills. To do anything else was and is to demonstrate weakness which simply asks to be punished by the neoliberal and punitive-minded EU. Corbyn too is demonstrating a lack of proper knowledge of the issues. If he understood the real issues he would be advocating a Hard Brexit and promising social policies to meet the transitional difficulties. The people would then hand government to him on a platter at the next elections.

    All this talk about Brexit being a catastrophe is nonsense. A world war is a catastrophe and Britain survived two of those. Are the Brits now so weak and stupid that they can’t envisage surviving a mere trade realignment to strike a blow against neoliberalism? Whatever happened to socialism with a spine?

  3. My view is that as long as Britain retains its monetary sovereignty it has the upper hand in negotiations with the EU superstructure. And the idea that Britain cannot pay bills is nonsense for a monetary sovereign, of course it can pay its bills, it creates new money when it pays a bill. All the excesses are on the EU side of the fence. These rules and regulations, broken and unbroken, are crippling the EU economies. Whatever would make joining that train wreck attractive?

  4. @Christopher: As with many advocates of “vulgar MMT” you forgot the crucial caveats: inflation and devaluation. The UK can create as many pounds as it likes but it can’t force people overseas to take them as payment for its bills, or for debt denominated in other currencies. So, an attempt to finance real expenditure in excess of production will lead first to devalution and then to inflation. At that point, as the correct version of MMT states, it’s necessary to raise taxes to reduce private sector demand.

  5. Ikon: “The No Deal, Hard Brexit, path was the correct path to threaten up front. Then, wait for the EU to blink and offer a concessional deal.”

    I don’t think this is right. The negotiating game was always in favour of the EU. Trade costs (based on distance) means the UK needs the EU market, not the other way around. In its raw form its 27 vs. 1. In an interconnected, just in time supply chain world the loss of EU supplies (will be?) devastating. There was no basis for the EU to blink as they had, and continue to have, the upper hand.

  6. Perhaps the British side could call in Donald Trump, master deal-maker, to help drive a better bargain.

    In an early meeting between the two, Trump advised May to sue the EU. As a tactic to get your way in a dispute, litigation probably works very well in the New York real estate development industry, and it no doubt served Trump very well over years. As a way of extricating yourself from the forest of agreements and treaties that together make up the EU, it might not work all that well.

    To be clear, “No Deal” doesn’t really mean that. A literal no deal would see Britain reduced to food rationing in a matter of weeks, air travel cancelled immediately and so on.

    Maybe, but the hard Brexiters have more than a whiff of Admiral Farragut about them, “Damn the torpedoes! Four bells. Captain Drayton, go ahead! Jouett, full speed!” They are not going to blink, God only knows what the Labour Party will do (they probably don’t know themselves), May only cares about hanging on to No 10 for as long as humanly possible and it’s not obvious that the EU will do either. It only takes one of the EU27 to veto an extension, and it is easy – very easy – to see Hungary or Poland doing just that, possibly in cahoots with the hard Brexiters.

    It looks like August 1914. Everyone can see the bad outcome coming, few want it, no one can stop it.

  7. What Britain wanted – all the benefits of membership, none of the costs – was never on the cards. It was not a matter of relative bargaining positions, it was that the EU was never going to dismantle itself to please Britain (ie, by giving UK financial institutions free rein with no oversight, UK products free access with no regulatory oversight, UK membership in EU joint ventures such as Galileo with no membership obligations…). Brexit on the Brexiteers’ imagined terms was a cheese submarine from the start.

    Where it goes from here is anyone’s guess. Parliament has tried to assert itself, but the executive has most of the levers.

  8. “On the other side carry it through regardless of what the EU thinks.” Not sure what this means other than what is usually referred to as ‘no deal’, which in turn means the UK – EU trade relationship is defined by the World Trade organisation terms and there will be a border between Northern Ireland and the Republic of Ireland. The legal status of non-UK EU residents in the UK is undefined, the status of UK residents in EU countries will depend on the countries in which they reside (eg Germany has offered UK residents to stay in case of a ‘no deal Brexit’. I don’t know whether this offer would entail free movement everywhere else in the EU. But I do know Nigal Farage is married to a German woman and has therefore the right to acquire the German nationality).

    The French President, Macron, described the dilemma as the British people have been asked to vote for something and now they are being told that what they voted for is not possible.

    Sarah Wagenknecht (die Linke, Germany) proposed to have a referendum in which people will be asked whether they want a second referendum on Brexit. This seems to me the most logical proposal so far.

    IMHO, the Brexit process shows up how out of date international trade theory is, which is still taught, as well as the empty theories spread by some MMT people. The word ‘sovereignty’ is used a lot as if the word would be self-explanatory and absolute. IMHO, if China were to gain world dominance, then ‘the loss of sovereignty’ might become self-explanatory. At present, the EU is the only cooperative multi-cultural major economic power to provide a bit of philosophical and institutional competition to both China and the USA. Some in the EU say the departure of the UK from the EU will make it easier to control the finance sector within the EU.

    UK politicians and opinion ‘influencers’ are not alone in hiding behind ‘Brussels’ to get away with their preferred actions or beliefs.

    No-liberalism as in financial capitalism was not conceived in Brussels or Berlin but in the UK under Margaret Thatcher (‘big bang’).

  9. Sarah Wagenknecht (die Linke, Germany) proposed to have a referendum in which people will be asked whether they want a second referendum on Brexit. This seems to me the most logical proposal so far.

    Extending the logic, why not have a referendum on whether to have a referendum on whether to to have a referendum in which people will be asked whether they want a second referendum on Brexit? And so on.

    The argument against a second referendum with the same question is that the people were asked once and delivered an answer. This does not however rule out a referendum in which a different question is asked, such as, rank in order of preference Brexit with no deal, Brexit with May’s deal, no Brexit. If forcing people to rank the options is unacceptable, give them the option of just putting 1 next to the option they like.

    Preferences get distributed like an Australian election, one of the options wins and Bob’s your uncle.

  10. I don’t think that logic has any role in Brexit, this is more a desperate move to retain a perception of identity.

    Nationalism doesn’t need to be logical to be successful and Brexiters are able to resort to grand illusions and delusions to maintain currency.

    It’s quite possible that the day will arrive without any resolution having been made however I think the possibility of a Corbyn led govt might be sufficient to stir them into activity.

  11. I think it’s very likely that one of Theresa May’s most important motives throughout has been the obsession with not displaying weakness which is common with many people, particularly politicians. But the UK is and always has been weaker than the EU27 because of the vast disproportion in economic capacity, which meant that the EU27 was always going to be negotiating from a position of greater strength than the UK. The EU27 always knew this, and so did many people in the UK, but many other people in the UK chose to lie to themselves and others about this because they found it too painful to admit, honestly, their position of weakness.

    It is not, by the way, an indicator of culpability that the EU27 is in this position of greater strength. At no stage did the EU27 choose to place itself in opposition to a weaker party.

    If somebody came to me and said, ‘I don’t want to negotiate an agreement with you’, I would respond, ‘Well, it takes two sides to negotiate an agreement, so if you don’t want to do that, I guess that means we won’t have a negotiated agreement’. Would you behave any differently, Ikonoclast? If the UK government had told the EU27, ‘We don’t want to negotiate a withdrawal agreement’, then the predictable response of the EU27 would have been one of bewilderment (as they’ve been repeatedly bewildered by the conduct of the UK government), but also would have included an acceptance that without negotiation there would be no withdrawal agreement and that all that was left for the EU27 to do was prepare as best as possible for withdrawal without agreement.

    Leaving the UK with no withdrawal agreement is exactly what some people want, believing it to be the best option for the UK, but that’s different from the far less plausible fantasy that the best way to extract concession from the EU27 was by threats, least of all the empty threat of refusal to negotiate.

    All this talk about Brexit being a catastrophe is nonsense. A world war is a catastrophe and Britain survived two of those.

    The example of the world wars shows that it’s possible for people, or most of them, to survive something which is, nonetheless, a catastrophe. People, or at any rate most of them, will survive Brexit, but that’s not enough to demonstrate that it won’t be a catastrophe.

  12. The German elite self-perception that Germany “had” to be a world power led it into two great wars. At least this is unlikely to be anywhere near damaging on the same scale.

  13. Pr Q said:

    Now, I suspect the approach of 29 March will work a bit differently. Rather than unilateral revocation, May and the Conservatives will want an extension, which requires the consent of the EU27. To get that, they’ll need to offer a prospect of finality. Since a general election is unlikely to appeal, a second vote is the last option standing.

    I predicted a second Brexit referendum in response to Pr Q analysis, which seemed basically sound:

    The UK government may “unilaterally revoke” its Article 50 application.. But it cannot “unilaterally revoke” legislation passed by Houses of Parliament, unless we wish to return to the days of governance by regal fiat.

    I would expect a Second refferendum to be held to break the impasse, whuch would apoear to favour Rsmain, since thus divorce apoears to messy. But there does not seem to be much time for that.

    The Betfair odds on another Brexit referendum prior to 2020 are 3.0 which seem quite tasty. I will have a $100 flutter.

    A second referendum seems fair to me given the genuine buyers remorse among the Brexiteers over the cost of Brexit, who have learned their lesson about the rewads of union. The Remainers, by contrast, appear to have learned nothing and apologised for nothing. The politically correct liberals seem unconcerned about exposing young girls to further atrocities of the RotherhamTelford class, which is basically what tipped the UK into Brexit in the first place. So I would be locking up my daughters if the UK winds up Remaining in the EU.

  14. Smith9 at 4:26pm
    1. Wagenknecht’s proposal satisfies your criterion of asking a different question.
    2. Your logic entails a redundancy of referenda.

  15. J-D:
    “But the UK is and always has been weaker than the EU27 because of the vast disproportion in economic capacity, which meant that the EU27 was always going to be negotiating from a position of greater strength than the UK”

    In some sense I agree. However, I believe it is helpful to note that the EU27 has merely upheld the principles which underpin the economic capacity.

    I still believe those who you characterise as “other people in the UK chose to lie to themselves and others” gambled on the break-up of the EU (possibly for psychological reasons you have indicated).

  16. Jack Strocchi says that ‘politically correct liberals seem unconcerned about exposing young girls to further atrocities of the Rotherham–Telford class, which is basically what tipped the UK into Brexit.’
    Apparently abuse of young girls is by, and only by, people who have entered the UK under freedom of movement from the EU.
    This would be news to ‘Tommy Robinson’, for whom all abuse of young girls is by people from the Indian subcontinent, or by Moslems, depending on what plays best in the tabloids. And to anyone who looks up the statistics, and finds that (in the UK as in Australia) gang rape and organised molestation are disproportionately likely to be committed by those of ‘Anglo’ ethnicity and local birth, and disproportionately unlikely to be committed by Moslems and by immigrants however they came.
    Strocchi proposes that opposing Brexit supports free European community entry and that this exposes young girls to atrocities – to which they would otherwise be less likely to be exposed. He shows no working for this proposal, and the facts are all against it.
    Apparently a concern for facts about abuse of young people of any gender, and a concern not to attack free entry of EU people on the basis of racist slurs against Moslems or people of Indian subcontinental background, makes me a politically correct liberal. Strocchi is neither correct nor liberal: nor does he say directly what he, unequivocally, implies.

  17. (Attempted rewrite of a comment held up in moderation from a link)
    The options are:
    A – Exit with no deal
    B – May deal
    C – A softer Brexit (“BINO”) on Norway or Jersey lines; undefined, but probably with staying in most of the EU single market, few restrictions on movement from EU countries, and no say in the rulemaking
    D – Remain.
    You can make a case that A, B, or C have no right to be on the referendum menu. A is a disaster and the Commons oppose it. B is workable but there is a huge Commons majority against. C, apart from not existing, has no prospective advantages over Remain. The inference from these observations is that the Commons should just ignore the first referendum, reject the three rotten fish, and instruct the government to cancel its Article notice.

    That would be sensible but a second referendum is more likely. Since there are Condorcet majorities in the Commons, and quite possibly the country, against anything, the order of the questions is critical. I suggest it should follow the standard practice in assemblies of voting on the greatest upheaval to the status quo first. So the decision tree should follow my order above.

    Suggested questions:
    “Q1. Are you in favour of leaving the EU at the Article 50 deadline even if no deal has been agreed with the EU? Yes/No.
    Q2. If a majority votes No to Q1, are you in favour of the May deal? Yes/No.
    Q3. If there are majorities against both Q1 and Q2, are you in favour of negotiating a softer Brexit, with substantial continued membership of the single market, substantial continued freedom of movement with other EU countries, and negligible future participation in EU decision making? Yes/No.
    Important note: If there are majorities for No to Qs. 1, 2, and 3, Parliament intends that the UK will withdraw its notice to leave and remain a member of the EU”.

  18. As usual Ernestine has nailed it with her analysis. I like that bit about Nigal Farage getting German citizenship. If all economic arsonist could be persuaded to take out citizenship in other countries a lot of problems would simply go away. As we are being told by main steam media, Brexit is like a divorce. Hopefully it is still an amicable divorce. But any divorce is messy when the children are concerned. Especially their possible futures. They are the ones I feel sorry for above all the political economic drama we see on TV every day. I have two nephew living in England. They will grow up into a much weakened Britain.
    If Scotland leaves the UK it could be a greatly weakened Britain. The future of all the UK children is on the line. But like other children in any divorce settlement aftermath, they will have to cope with changed economic circumstances. Already their parents’ wealth have fallen as they home has been devalued. If there is an inflationary period this could be made worse in real terms. So its the children of the UK I feel sorry for not the politicians.

  19. @ Ernestine Gross

    Nigal Farage is married to a German woman and has therefore the right to acquire the German nationality

    He was sighted leaving the German embassy some time last summer.

  20. The essential logic of persons in favor of Britain remaining in the EU is this:

    (1) A big neoliberal project is good. The bigger the better.
    (2) The Referendum should be ignored or re-run until the people make the “right” choice.
    (3) Supra-national corporate legalism should triumph over votes in democratic polities.

    Part of the logic here is that once a (decidedly imperfect) democracy signs up to something legally it can never leave. Even if conditions change, even if new information comes to light, even if the people’s views change, even if what it sign up to gets hijacked, the sign-up is to be well nigh irrevocable in practical terms. This is exactly how supra-national corporate neoliberalism works as a legalistic Gordian knot system. It’s how ISDS (Investor-state dispute settlement) works. This corporate legalism gets people and polities entangled in agreements which are rigged as near irreversible processes. They are easy to enter into and get entangled in but very difficult to exit from.

    Membership of the EU has become an “odious entanglement” for the British people. The concept is really quite similar to that of odious debt. The EU has, over time, developed into a seriously inimical and despotic neoliberal and corporate controlled regime. The British people are entitled to cut the Gordian knot, unilaterally if they wish, and to renege on all payment claims from the EU which essentially equate to odious debt.

    “In international law, odious debt, also known as illegitimate debt, is a legal theory that says that the national debt incurred by a despotic regime should not be enforceable. Such debts are, thus, considered by this doctrine to be personal debts of the regime that incurred them and not debts of the state. In some respects, the concept is analogous to the invalidity of contracts signed under coercion.” – Wikipedia.

    The EU is essentially a despotic regime. It’s monetary management in the interest of corporate banks, it’s infliction of collapse or exacerbated collapse, on Greece and other regions are the actions of a despotic regime.

  21. Problem is Ikonoclast, the political forces behind Leave believe the UK is not sufficiently neoliberal/Thatcherite due to its EU membership.

    Hard right Tories, Farage, various billionaires, they all subscribe to your premise #1 “A big neoliberal project is good. The bigger the better.” Only difference is Brexit is their big neoliberal project.

  22. As I’ve said previously, Brexit is like the Iraq war. There’s an alliance between people who agree on Step 1, but disagree radically on what should happen after that. Each assumes that their own vision will triumph. By contrast, in the case of Iraq, the opponents predicted lots of different disasters, nearly all of which came to pass.

    The likely reality of Brexit, if it takes place through a deal, is much the same as now, but a little poorer and a lot nastier. But a literal No Deal Brexit could be quite a bit worse.

  23. Iko: How can the EU be a “big neoliberal project” since it was created before neoliberalism existed? Jean Monnet never went to university (though he wasn’t short of intellectual self-confidence). His ideology, if he had one, was standard French Colbertian statism. (He served as de Gaulle’s Commissaire au Plan in a postwar government that nationalized the banks, which is some way further red than Corbyn proposes.) The Iron and Steel Community assumed that these two industries were largely under state control. The EEC, five years later, was a free trade area, because Monnet and friends thought that was what was doable at the time.

    The EU institutions have inherited from Monnet a ruthless and skilled ambition in expanding their powers, sometimes in a liberal direction (antitrust), sometimes a socialist-dirigiste one (the CAP). In the last 20 years, the dominant currents they have surfed have been if you like neoliberal: but the EU is at heart a Vicar of Bray, and will adapt to whatever ideology is fashionable. The one scarcely secret plot is to create a government of Europe.

  24. If there’s one set of principles that defines the EU, it is an almost obsessive adherence to sets of rules and laws, even when they make little sense. As an entity, it is process-driven above all else. This is the opposite of neo-liberalism.

  25. Betfair odds on a second referendum being held -< 31/12/2019 are @ 3.0.

    This seems quite generous given that informed opinion seems to be swinging towards Brexit R v.2.

    Are there any constitutional, legislative or logistical barriers to another Brexit referendum in 2019? Or is it all the impenetrably tangled web of EU and UK politics?

    I need to know fast before the odds shorten.

  26. Are there any constitutional, legislative or logistical barriers to another Brexit referendum in 2019?

    A second referendum can’t be organised before March 29. Therefore Brexit Day would have to be postponed. This can only happen if the UK Government asks for postponement, which so far they have shown no inclination of doing, and each of the EU27 agrees. If you think that there is a 90% chance of each one agreeing individually, the likelihood of all 27 of them agreeing (assuming they decide independently) is just 6%. Everyone seems to assume that the rest of the EU would just love to have the UK back in the fold. I wouldn’t be so sure. If, somehow, Brexit get cancelled this time, there will be forces in the UK that will agitate for Brexit in the future. Like genital herpes, they will be impossible to get rid of. This will just destabilise the EU further. The Poms have been nothing but trouble in Europe, always complaining, always looking for, and often getting, special carve outs from the rules for themselves. A lot of European governments will be happy to see them gone.

    I’d be looking for better odds than 3.0.

  27. If Theresa May has one distinctive feature it’s her racism, if she has another it’s her incompetence, and if we go so far as her third it’s an incomprehensible stubbornness.

    They’re gonna crash out.

  28. “The Poms have been nothing but trouble in Europe, always complaining, always looking for, and often getting, special carve outs from the rules for themselves. A lot of European governments will be happy to see them gone.” – Smith

    Well, it looks like a Brexit should increase the net happiness of Britain and Europe! It’s a win-win. 🙂

  29. Well, it looks like a Brexit should increase the net happiness of Britain

    I listened to a clip from a UK radio program in which the host kept asking the (pro-Brexit) caller ‘How will Brexit make your life better?’ and the caller kept not answering that question.

    So that’s my question for you: how will Brexit improve the lives of people in the UK?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s