John Bruton

Opinions & Ideas

THERESA MAY’S ELECTION

Theresa May has decided to call an early election, before the practical outworking of her Brexit strategy becomes obvious to voters. She wants to be free to modify her strategy, and ,for that, she needs a bigger parliamentary majority.

She claims otherwise. Instead she says she is calling the election because Opposition parties oppose her Brexit strategy. They don’t oppose it, actually. They have cooperated with it, to a point that makes little of parliamentary sovereignty.

The only opposition party that opposes her strategy outright are the Scottish Nationalists, who take that position because that is the way Scotland voted in the Referendum. In any event, the Scottish Nationalist Party could not bring Mrs May’s government down on Brexit, unless Labour, the Liberal Democrats and, most importantly, a significant number of Mrs May’s own Conservative MPs, voted with them, which is not at all likely to happen.

Rather more bizarrely, Mrs May justifies her call for an immediate General Election on the ground that the Labour Party has threatened to vote against the final agreement she may come back with, in two years time. What does she expect? That the main opposition party would give her a blank cheque on the terms of Brexit?!

Usually negotiators actually find it useful to be able to say, when looking for a concession, that if they do not get it, the overall deal might be opposed in Parliament .  If she is to be believed, Mrs May apparently wants to give up that negotiating chip.

Mrs May ostensibly defend the sovereignty of the UK Parliament. But now she is calling an election because the opposition will not promise not to exercise their sovereign parliamentary rights.

My own sense is that none of the reasons she has advanced are the real ones for which she has sought an early election.

She is seeking an election to increase her overall majority, so she will no longer be dependent on a hard core group of around 60 Euro hostile Conservative MPs, who hold disproportionate power at the moment because the Conservative overall majority is so small.

For these MPs hostility to the European Union has become a religion, a religion which brooks no argument, and a religion for which any economic sacrifice can be justified, even the sacrifice of the livelihoods of their own constituents. Mrs May does not want to find her day to day negotiations with the rest of the EU subject to the whim of these people, by whom the slightest compromise  with the EU 27will be portrayed as a betrayal.

It is important to remember that Mrs May, like the rest of her Party, have never taken much interest in how the EU works, in its procedures and rules, and in the compromises that underlie its very existence. She has this in common with many politicians in bigger European countries, who treat the EU as a sideshow to national politics.

So, even though her Party sponsored the idea of holding a Referendum on leaving the EU, she did not give much thought to what leaving the EU might actually mean, until the last few months, when it suddenly became something real, something that was going to happen. In a sense, she and her party, are now finding out a lot about the EU for the first time, just as they are leaving it!

Her first reaction to the Referendum was to get her Party behind her as their new Leader. So she told the Conservative Party Conference last year that she would go beyond the mere terms of the Referendum.

She would not just leave the EU.  She would refuse to join the European Economic Area (unlike non EU member Norway), and also refuse to join the EU Customs Union ( unlike non EU member Turkey).  This hard line bought the temporary quiescence of the Euro hostile MPs, up to and including on the  terms for triggering of Article 50.

But now come the actual negotiations.

This is where Mrs May’s rhetoric at the Conservative Party Conference, meets the reality of a rules based international trading system. In a rules based international trading system, unpleasant compromises are essential if  you are to persuade others are to open up their markets to your exporters,  to your bankers,  to your planes,  and to your people.

In a rules based international  trading system, you cannot, unilaterally, make, interpret and enforce the agreed rules, in a way that suits only you. There has to be a common system, which involves some concession of sovereignty.

You often have to accept an external enforcer, like the European Commission or an International Court.

And you often have to accept an external body interpreting the meaning of the rules, someone like the European Court of Justice, or a Disputes Panel of the WTO.

But this is unacceptable to those who have made national sovereignty into a religion. It is unacceptable to some of Mrs May’s Euro hostile MPs, and also, incidentally, unacceptable to some of the supporters of Donald Trump.

I have been reading publications of Conservative supporting think tanks, like the Bruges Group and “Leave means Leave”, and they are discovering now, how costly it will be for the UK to leave the EU Customs Union.

The UK will have to introduce Customs controls on the goods bought and sold between the UK and the EU. This will involve checking where the goods came from, if they are properly labelled, if they are safe, and if the tariffs due have been paid. The delays will be horrendous.

Customs clearance alone will add 8% to the cost of goods arriving by sea from Ireland or the rest of the EU.

At the moment  90million customs declarations have to be checked in the UK for goods arriving from outside the EU. Once the UK itself leaves the EU Customs Union, UK customs officials will have to check 390 million documents!

By leaving the EU Customs Union,  the UK will not only exclude itself from duty free access to the EU market, which represent over 50% of UK trade, but it will also lose the benefit of Trade agreement the EU has negotiated with 60 other countries, which account for a further  17% of UK exports.

For example, since the EU negotiated a trade deal with Korea ten years ago, UK exports to that country increased by 110%. Leaving the EU means giving that up, temporarily, and, perhaps, permanently.

Mrs May is also beginning to discover that her hard line on immigration will have costs. 20% of employees on UK farms, and 29% of employees in UK food processing plants are EU nationals, who will lose their right to live and work in the UK.   When the UK tries to negotiate trade deals with countries outside the EU, like India, it will find that it will face demands for more Indian migration to the UK.

UK Airports will find themselves losing business when the UK has to leave the EU Open Skies Agreement with the United States. More US transit traffic will be routed through Dublin. The UK will also have to try to join the European Common Aviation Agreement as a separate member, if UK owned airlines are to have the right to fly passengers between EU airports. Rivals will not make it easy for them.

UK farmers and food producers will find themselves facing tariffs of 35% on dairy exports, 25% on confectionary, and 15% on cereals. UK lamb production will be hard hit.

If Mrs May wants to be able to make deals to avoid some of these bad outcomes, she will need the sort of flexibility, that her Euro hostile backbenchers would not allow her.

That is why I think she is calling a General Election now.

The strategy may backfire.

If during the election, she is forced into explicitly ruling out various possible compromises with the EU, she will end up with LESS flexibility that she has now. .

A lot will depend now on what the Conservative Party manifesto says about how the practical problems of Brexit will be tackled. Will it deal with these issues specifically at all?  Will Theresa May be able to get through to 8 June relying on reassuring generalities about problems like customs delays, bureaucracy, higher air fares, the end of farmer income supports, migration policy after Brexit, and the loss of access to markets for British exporters?

Given that Mrs May is avoiding taking part in debates she may be able to avoid these questions, but six weeks is a long time in politics!

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1 Comment

  1. John McHugo

    I wonder, though, whether a greater Tory majority will actually give her the freedom to face down the British nationalists: the hardline, Tory MPs who will brook no compromise over Brexit. It is unlikely. I suspect many of the new Tory MPs she gains from former Labour seats will be equally militant and uncompromising. That has been the way of Tory party activists over recent years. It is one of many reasons I am a Liberal Democrat. This election is a carefully calculated power grab. I only hope it backfires on her.

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