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Brexit Brinkmanship

There is plenty of blame to go around for Britain’s current Brexit chaos. In a recent post, I pointed to how the Prime Minister’s handling of the withdrawal negotiations was simply incompetent. But at least some of the blame should now be handed over to the House of Commons, which has failed to produce a majority for any course of action. With the official separation due to happen by law on March 29th, Brexit is being pushed to the brink.

On the other side, of course, is the European Union, whose views on Brexit are regularly and inexplicably ignored by British commentators. While those who wish Brexit to be canceled were hoping that the EU might agree to a long delay to Brexit to allow for new elections in Britain or even a second referendum, the European Council appears to have scotched that hope. The Council has agreed to grant an extension if, and only if, Theresa May’s withdrawal agreement is approved by Parliament. It has been rejected, decisively, twice. The extension would be until May 22nd, simply to allow for the withdrawal agreement to be implemented.

Indeed, as Financial Times columnist Wolfgang Munchau (probably the most insightful European commentator writing in English) has pointed out, the Europeans recognize something that British MPs don’t:

I believe the EU should disabuse the House of Commons of the silly idea that it can “force a delay” or “take no-deal off the table”. And it should remind MPs of the inverse relationship between the actual risk of a no-deal Brexit and the efforts to take it off the table.

The EU will no doubt say for the umpteenth time that the withdrawal agreement is the only deal on offer. Even if the UK were to hold elections, the deal will not change. Nor would there be any change if the UK were to revoke Article 50 only to trigger Brexit again.

Munchau later tweeted that “[W]e have reached the moment where EU is becoming more scared of an unconditional Brexit extension than a no-deal Brexit” and noted that even Germany, which has the most to lose from a no-deal Brexit, was moving in that direction.

There is still the possibility that Her Majesty’s Government could change the date of Brexit in UK law unilaterally by means of a “statutory instrument,” a form of delegated lawmaking that allows the Government to change certain clauses of laws. However, as this Hansard Society post explains, not only would that have to be agreed to by the EU (unlikely for the reasons explained above), the process would have to start on March 25.

Therefore, if the House of Commons fails once again to agree to May’s withdrawal agreement, as seems likely, it will have to agree to something next week. The choice will be either no deal or a de facto cancellation of Brexit. This choice is likely to split both major parties. The Conservatives campaigned on a manifesto promise of Brexit, but is also generally pro-business, which fears Brexit, and many of its MPs represent constituencies in the South East of England that benefit from their proximity to the EU and, if they did not vote remain, contain large numbers of remainers. The Labour Party, meanwhile, which also campaigned on a somewhat softer promise of Brexit, has a Northern heartland of strongly-leave constituencies but also a large number of university towns and London seats that are the heartland of the remain vote.

The party splits that these votes are likely to cause could well be a decisive step in the realignment of British politics, something Prof. Stephen Davies of the Institute of Economic Affairs has been forecasting for a while. Where the chips will fall is anyone’s guess.

What we do know is that the UK Parliament faces some very hard decisions next week, decisions MPs have not been willing to face. Their brinkmanship seems to have been relying on the idea that the EU would save Parliament from having to make its mind up. That was always a silly idea brought about by a surfeit of navel gazing.

With their brinkmanship exposed, MPs will have to make a decision which amounts to a choice between agreeing to a deal no-one likes, plunging the country into (hopefully short-lived) economic chaos through no deal, or repudiating the largest democratic vote ever held in the country.

As the likely economic chaos can be mitigated by correct economic policy and the proper institutional framework, no deal is probably the least problematic choice. It also appears to be the least popular among MPs. However, the Financial Times is now reporting that Theresa May herself appears to have agreed that no deal is the least bad option on offer.

Meanwhile, the EU is ploughing ahead with preparations for no deal. That is something the UK should have been doing two and a half years ago.