Brexiteers routed in Brussels

By Mark Buckley

The complete humiliation of the Tory Brexit negotiators has been greeted with wild claims that Theresa May achieved a stunning victory. Any more ‘victories’ like this and the UK will be passing rapidly from a second-tier power to a fourth-rate one.

The Tories had claimed that this process would not even begin, that nothing would be conceded until they forced an extraordinarily favourable trade deal. Agreement on everything else on the EU’s agenda, citizens’ rights, the financial settlement and the question of the Irish border, would all be withheld until the EU conceded on trade. Yet on every count, it was the UK that conceded, the red lines disappeared and there are no bargaining chips. This was a Brexit debacle.

Winning the PR, not the negotiations

It is extremely important to understand why the Tory capitulation has mainly been greeted with acclaim. Outside minority groupings, most large-scale British businesses want the ‘softest’ possible Brexit as their profits will be hit by curtailed access to the Single Market. Even the pro-Brexit press has to take account of the consequence of rejecting the deal and bringing down May; Jeremy Corbyn is the next most likely Prime Minister. Two recent articles, one in the Financial Times (£) and one in the Times (£) makes this point explicitly, Corbyn is worse than Brexit and we should unite to oppose that possibility. They are the authentic voice the entire British ruling class.

The reality of the Agreement (pdf) is completely different to the pro-Tory spin. Every Brexit red line, bargaining chip and fantasy that is addressed is destroyed.

EU citizens (and UK ones living in the EU) can no longer be disgracefully used as ‘bargaining chips’ as the agreement begins with an explicit recognition of their rights. In addition, the continued jurisdiction of the European Court of Justice (ECJ) is formally recognised in overseeing those rights in the UK. Evidently, the EU did not trust UK protestations of good faith.

The financial settlement will be very large. Estimates of £40 billion are speculative, as detailed analysis of liabilities has not been done, some are unknown and the amount is dependent on the exchange rate. But it was not the EU who was forced to ‘go whistle’ for money, it was the Tory negotiators. Even this amount will cost every adult in this country about £1,000 each.

Ireland and the border has not been postponed, as the Brexiteers wanted, to become part of the overall trade negotiations. This would have been another contemptible ‘bargaining chip’ approach.

On the Irish border, the agreement specifies that the UK must propose some (as yet unformulated) solution to ensuring it does not become a policed border, and if it fails to do will “the UK will maintain full alignment with the rules of the Internal [Single] Market and the Customs Union”. Note this is the UK, not simply ‘Northern Ireland’. In addition, the European Union will act as guarantor against any reduction in equal rights under EU law, which means continued jurisdiction of the European Court of Human Rights, another long-standing ‘red line’ of Theresa May’s that has now disappeared.

On future trade arrangements, the Agreement states that EU law and the jurisdiction of the ECJ will continue to apply to all contracts entered into before the UK’s withdrawal and that a mechanism must be agreed in future to apply EU law and jurisdiction.

Future trade relationships

The Tory Brexiteers had claimed that they would not agree on the EU’s three key issues because they wanted to focus on a favourable trade deal. Both parts of that statement were untrue. There is now agreement on the three issues, however sketchy in parts. But the Tory Cabinet had not even discussed its overall aims in trade talks, as Philip Hammond recently confirmed. We now learn that the first discussion may take place on December 19.

The reason the Tories have endlessly postponed trade talks is because the Cabinet and the Tories in Parliament are split between those who want the closest possible trade relationship with the EU and the Hard Brexit fantasists who talk about ‘the open seas’, unilateral free trade agreements, and ‘Empire 2.0’.

What keeps them together has been support for austerity and now their determination to prevent Jeremy Corbyn coming to office. But opening up their divisions over relations with the EU could prove lethal.

Of course, May and her advisers are keenly aware of this too. On the UK side the wording of the Agreement and the commentary on it from the principals such as Theresa May and David Davis suggests that they believe this conundrum can be solved, so strongly that they have told Cabinet Leavers that the pledges on alignment with EU rules are ‘meaningless’.

In a perceptive article, Simon Nixon, the chief commentator for the Wall Street Journal Europe argues that the Tories in talking about ‘alignment’ may have in mind a Mutual Recognition Agreement, in which rules and rule-making differ, but the separate processes and outcomes are accepted on both sides. The model is said to be the Trans-Atlantic Trade and Investment Partnership (TTIP). But, as Nixon points out, the TTIP failed because neither side was willing to give up regulatory autonomy to satisfy the others’ rules. If the EU was not willing to bow to the US, it is unlikely to be bullied by the UK. It seems the Brexit fantasies are far from exhausted.

Labour’s position is increasingly clear as talks progress and increasingly focused on the imperative to maintain jobs and even current levels of prosperity through the Single Market and Customs Union. The Shadow Trade Minister Barry Gardiner told Radio 4 listeners that the priority will be maintaining association with the higher labour, environmental and consumer rights of the EU, which represents a far higher proportion of UK trade, than the US, with its lower standards in every area. Shadow Brexit Minister Keir Starmer says Labour wants to maintain all the benefits of being in the Customs Union and Single Market (video), although to enjoy the benefits of any club, you usually have to be a member of it. This follows Jeremy Corbyn’s declaration that he would still vote Remain if there were another referendum.

While Brexit remains a project of self-immolation, these are all positive developments. The current Agreement will cost all of us, in terms of cash, without in any way providing the fake ‘control’ promised by the Brexiteers over laws and borders. The uncertainty over final outcomes will also continue to deter investment for years to come, making a sustained rise in wages and prosperity extremely difficult.

Many of the fantasies of the Brexiteers have been exposed and it is now clear that it will be the EU which dictates the terms of a future relationship. It is equally clear that Brexit is already making us poorer and will continue to do so. To reverse the decline in living standards requires an end to Tory austerity as well as staying in the Single Market and Customs Union.