Thursday, 17 December 2020

Finance markets are priced for more than perfection.. but madness happens...

 

The UK will now count the cost of Brexit sovereignty

Boris Johnson signs the European Union Withdrawal Agreement © Andrew Parsons/No10 Downing St/dpa

Finally. In two short weeks the UK will reclaim its liberty. Brexit has so far been a story of rancorous division, shaking political fists and fractured ties with old allies. The union of Britain and Northern Ireland has been put in peril. But the glittering prize that will make it all worthwhile is now in sight.

We know what it is called. Boris Johnson and his fellow Brexiters speak of little else. The country, the prime minister promises, is to recover its “sovereignty”. Forget the last minute wrangling with Brussels. The difference between a trade deal and no deal before January 1 is trivial against the loftier purpose. What was it Mr Johnson once said? “Fuck business”. Brexit is about taking back control, returning the UK to self-government, regaining full command of its borders, money and laws.

In one narrow sense, Brexit’s true believers are right. The gap between a thin trade deal and the absence of any accord is one between severe and more severe disruption. Either way, the UK will need 50,000 or more new customs agents to cope with the bureaucracy being injected into once-frictionless trading arrangements. The bargain under discussion is the first trade agreement in history consciously to raise protectionist barriers.

UK citizens will forfeit the right to travel and work without hindrance across the EU. Service industry workers will lose automatic recognition of their skills and qualifications. The independent experts belittled by ministers such as Michael Gove are near unanimous in predicting slower economic growth and lower living standards.

In return, British citizens will be able to indulge their nostalgia with a new, blue-hued passport to distinguish them from fellow Europeans — a reward that seems unlikely to compensate travellers for being henceforth consigned to the slow lanes at EU airports. Sovereignty, we are told by the Brexiters, also precludes membership of the Erasmus student exchange scheme, a role in the Galileo satellite project, and full access to the EU’s intelligence gathering on terrorist and criminal networks.

So what, it now seems fair to ask, does this precious sovereignty look and taste like? Does it come in the form of a sculpted Britannia, disinterred from the cellars of the Berlaymont headquarters of the European Commission to be placed on a pedestal at Westminster? Will the scales of justice be transferred by carriage from the European Court in Luxembourg to the UK Supreme Court? And how, some British voters might be inclined to ask, will any of this improve prosperity and security?

You might have thought a prime minister so attached to the idea of sovereignty would have planned a spectacular demonstration of what it means for the UK to regain control of its borders, money and laws. After all, a post-Brexit pile-up of freight trucks waiting to cross the English Channel will not much look like an act of liberation. 

Instead, the Brexiters’ fatal confusion between sovereignty and power is about to be exposed. Untrammelled sovereignty sounds alluring, but in a world in which each nation’s security and economic wellbeing is inextricably connected to those of others, it turns out that it does not confer real power. 

Mr Johnson wants to stop migrants crossing the Channel in small boats to claim asylum in the UK. So what’s to prevent him after January 1, when the government will be free of all EU restrictions? It is called reality. Halting the boats will depend, as it always has, on the active co-operation of the French authorities. So much for sovereignty.

How Brexit disruption will change London's financial centres

During the debate before the 2016 referendum, Leavers were often asked when had the EU taken big decisions against the expressed will of Westminster. Where was the proof the EU had been trampling on the nation’s liberties? Beyond muttering about over-enthusiastic business regulation (much of it sought by British industry), I don’t recall them giving an answer. 

These same Brexiters have nothing to offer now. Trade deals promised with third countries will largely replicate those the UK now enjoys within the EU. Mr Johnson’s insistence on a right to diverge from EU norms in areas such as the environment, safety and employment is empty of serious meaning. Businesses that want to trade will continue to shadow the rules set in Brussels. UK boats may catch more fish in “sovereign” UK waters, but they will have to find willing buyers on the other side of the Channel.

There you have it. Brexit is a national tragedy built on a chimera. The UK is about to discover that it has traded the real power to shape its destiny for an illusion drenched in nostalgia.

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