Moon of Alabama Brecht quote
October 16, 2020

"It's a hard Brexit's a-gonna fall"

Today the British Prime Minister Boris Johnson announced that Great Britain is now preparing for a no-deal divorce from the European Union:

The UK has to "get ready" for no trade deal with the EU, Prime Minister Boris Johnson has said.

Unless there was a "fundamental" change of direction from the EU, he said the two sides would not be able to agree a post-Brexit economic partnership,

The UK set a deadline of Thursday to decide whether it was worth continuing talks amid continuing disagreements.

Both sides have indicated they want to carry on but the EU has said it is up to the UK to make the next move.

The BBC's political editor Laura Kuenssberg said a no-deal outcome seemed to be moving closer after Thursday's meeting of EU leaders - which the UK was not present at - failed to "move the dial".

There will be no 'fundamental' change in the EU position. Yesterday's EU leader meeting had put the ball into the British part of the field:

At a summit in Brussels, the EU proposed a further “two to three weeks” of negotiations but Europe’s heads of state and government offered Johnson little succour, demanding that he alone needed to “make the necessary moves to make an agreement possible”.

The intervention was evidently regarded as incendiary in No 10 as Johnson had said he would make a decision on Friday on whether there were grounds to continue the talks. In September, he had said that without agreement by the time of this summit the government would “move on” to focus on no-deal preparations.

The summit communique issued on Thursday afternoon noted the lack of progress but asked the EU’s chief negotiator, Michel Barnier, to “continue negotiations in the coming weeks”. To the frustration of Downing Street, a call for an “intensification” of talks, included in an earlier draft of the statement, was deleted by the time leaders signed it off.

The EU says Britain still has to move on several points:

Speaking after the briefing from Mr Barnier, [Taoiseach Micheál] Martin said that difficulties and challenges remain in securing an overall agreement and there has not been sufficient movement from the UK on the three outstanding issues - the level playing field, governance and fisheries - to suggest a deal could be done.

The level playing field refers to the aspiration that both sides will adhere to similar standards so as not to undercut the other in trade and investment. Governance refers to a system of resolving disputes between both sides in the future.

Johnson's rejection of the EU's position makes it likely that the talks are now over. The EU has had enough of him. There will now be a hard Brexit and with hard I mean a very painful one. As Yves Smith wrote earlier today:

[I]n the meantime, there are more and more reminders of what January 1 might bring. One of the most bizarre comes via CityAM, reporting on the results of a House of Lords study about the consequences of the Government having ignored the services sector in its talks. We pointed out from the very early days of Brexit that services deals are far more difficult to negotiate than trade deals, and therefore typically take longer to conclude. We were skeptical a trade deal could be struck in 24 months, and even more so, a services deal. Nevertheless, it’s yet another proof of how out to lunch the people nominally in charge in the UK are to see a report like this coming out a mere two and a half months before the drop dead date. From CityAM:

Britain’s £225bn professional services industry has been ignored by the government and is under “catastrophic” threat of losing business to the EU post-Brexit, a parliamentary committee has warned.

A House of Lords’ EU services subcommittee report published yesterday said the UK’s accountants, lawyers, recruiters, architects and advertisers are under risk of losing contracts and jobs when Britain formally leaves the bloc in January.

The report accused the government of ignoring the “hugely important sector” — which makes up around 13 per cent of the UK workforce — in trade negotiations with the EU…..

There are also huge unsolved problems with VAT payments, tariffs, import and export regulations for manufactured goods and agricultural products. There is the unresolved border problem between North Ireland and Ireland and a myriad of other difficulties. This hard Brexit will be expensive for British consumers and businesses:

A no deal brexit would result in tariffs on goods traded between Great Britain and the EU. These additional costs could make some industries unviable in their current form.

Many UK sheep farmers have narrow profit margins and sell a high percentage of exports into the EU; which is the destination for seven of the top 10 British lamb exporters. Without a deal, tariffs equivalent to around 76% would be imposed on some cuts of lamb.
...
Car manufacturers would face tariffs of up to 10% when selling cars to the EU, with Nissan warning in June that its Sunderland plant could become unviable in a no deal. Other manufacturers may follow suit.

The government’s own reasonable worst case planning assumptions suggest that in a no deal 30-50% of lorries at the key channel ports could be unprepared for new customs checks and that traffic flow through the vital short channel straits could be reduced by 60-80%. The Road Haulage Association has put the chances of ‘chaos in Kent’ at 80%.
..
Even if traders and border systems are generally ready and supply disruption is limited, consumers may still face higher prices. The Bank of England predicted in 2018 that a disruptive Brexit could see sterling fall by around 15% against the euro, making imports more expensive. Add to that an average tariff of 5.7% on UK imports and the costs of new non-tariff barriers (like customs checks), and many businesses will have no choice but to put up prices, at a time when many will be grappling with the financial impact of the coronavirus crisis.

Under the Northern Ireland protocol, the border for goods moving from GB-NI will look very similar to goods moving between GB-EU – with no deal resulting in the most intensive checks. If the UK and the EU don’t agree a zero-tariff free trade agreement, the protocol says that goods ‘at risk’ of moving from Great Britain into the EU through Northern Ireland will have to pay tariffs.

It is now likely that on January 1 all trade between Britain and the EU will practically come to standstill.

Most of the above problems were foreseeable and many could have been avoided. But the current British government has done little to take care of them.

The level of incompetence the Johnson government has demonstrated during the Covid-19 pandemic was only overtaken by its desire to shell out lucrative contracts to its friends for services the National Health Service was much better positioned to provide. Covid-19 will not be over by January 1. It will continue to hamper the economy and daily life. Now put an ill prepared Brexit with all its consequences on top of that. How can anyone expect that Johnson will be able to handle that chaos?

With Brexit and Covid combined Great Britain will be in for a much greater pandemic depression that most other countries. It has so far only made a few trade deals that might buffer the coming slump. The U.S. is of course standing by to press the Brits into a trade deal that will rob them blind.

If the British economy will be back to its pre-Covid level by the end of the next decade the country should consider itself lucky.

When I heard of Johnson's  announcement today this song by Bob Dylan came to mind:

And what'll you do now, my blue-eyed son?
And what'll you do now, my darling young one?
I'm a-goin' back out 'fore the rain starts a-fallin'
I'll walk to the depths of the deepest black forest
Where the people are many and their hands are all empty
Where the pellets of poison are flooding their waters
Where the home in the valley meets the damp dirty prison
And the executioner's face is always well hidden
Where hunger is ugly, where souls are forgotten
Where black is the color, where none is the number
And I'll tell it and think it and speak it and breathe it
And reflect it from the mountain so all souls can see it
Then I'll stand on the ocean until I start sinkin'
But I'll know my song well before I start singin'
And it's a hard, it's a hard, it's a hard, it's a hard
It's a hard rain's a-gonna fall

Posted by b on October 16, 2020 at 14:51 UTC | Permalink

Comments
« previous page

Noirette | Oct 18 2020 13:46 utc | 99

It is unfair to blame Corbyn entirely . It begins and ends with his lack of confrontation.

However, the Corbyn experiment was doomed.

The right of Labour did everything they could to remove him. He was locked out of Labour HQ on the night of the 2017 general election (which Labour almost won). Moving campaigners from key areas to right wing constituencies was the killing blow for that one.

As time marched on, even his closest supporters turned on him. The push for remain (doomed) took both McDonnel and Abbott.

2019 GE doesn't make sense IMO. Watching Twitter early in the day, the youth came out in large numbers, yet Conservatives took a landslide victory. Postal votes doubled from 2017 (19% to 38%). Results were predicted the day before by the BBC. The company involved with postal votes is ran by an ex tory MP.

There was no way a socialist government was going to happen in the UK, and shenanigans via state agencies (and more) ensured it.

Ask yourself why Starmer isn't making the noise for remain now he is leader...

Posted by: Some Random Passerby | Oct 18 2020 18:59 utc | 101

The negotiations going on between the UK and EU are two sided. One side want something, the other country make a counter offer. If they disagree, well that is fine.
The rhetoric on the UK side is to blame the EU for being heavy handed and mean. Boris seems surprised the EU won't give the UK a Canada-style deal. This is disingenuous as some points of the Canada deal, the UK will not accept. While the UK is also a much different trading partner with the EU, we export and import far more and therefore the EU naturally wants to protect certain industries which Canada does not threaten but the UK could.
It seems obvious to me that the Conservatives want to be freed of as much oversight as possible, internationally and even from the UK's own judiciary. To enter the neo-conservative promised land of removing any regulation which may impede profit, you know, worker's rights and environmental protections.

Posted by: Mighty Drunken | Oct 18 2020 21:57 utc | 102

- For Boris Johnson and his sycophants plan A, B, C, D, E etc. etc. was ALWAYS a "No Deal" plan. They simply DO NOT want a "Deal". They want a "No Deal" Brexit. Why can't the EU can't get that in their heads ? And a "No Deal" Brexit doesn't matter too much because the UK is part of the WTO (agreement), as is the EU.

Posted by: Willy2 | Oct 19 2020 12:51 utc | 103

Yes, Some Random passerby @ 101, unpopular, in a way it is unfair…and Corbyn was absolutely falsely demolished..

Starmer is a Third-Wayer, Blairite, in a way worse than the original (Blair), as the French say, the copy is shoddier than the original. False oppo all that stuff.

*Remain* is in the dustbin of history.

Posted by: Noirette | Oct 19 2020 15:54 utc | 104

Tory never had ANY intention of securing a 'deal'. A dictatorship that is accountable to no one* is what it seeks, and that's what it will get; no matter what the cost to the economy or vast majority of folks in the land (AKA: All non wealthy folks)
*If you think the UK media holds Tory to account you have not been paying attention for 40 years...and therein lies the election results, so 'the people' are screwed too, god help them.

Posted by: LeoNemo | Oct 20 2020 6:39 utc | 105

« previous page

The comments to this entry are closed.