Sunday 9 September 2018

What have you got?

It is a well-known physical property that when heat is added to a substance the molecules vibrate faster and usually maintain a greater average separation. Ultimately the object expands in size and takes up more space. If we take away the heat source, the molecules move more slowly and if we were to freeze an object containing water, it would actually contract.

The Brexit debate feels a bit like that. The two years following the referendum have generated more heat than light and the whole issue has expanded to take up an increasing amount of media space. Politicians such as Jacob Rees-Mogg and Boris Johnson fan the flames by making outrageous claims as to how to achieve Brexit and what the benefits will be, generating a counter response which fills up a lot of column inches. If, however, we were to dial down the rhetoric a little and think about what the end game might be, we might be better served in terms of working out how to proceed. 

Basic premise: Neither side wants no deal 

We should start from the premise that neither the UK nor EU want a hard Brexit next March. It may not seem that way when we are assailed with stories telling us that the government recommends stockpiling essentials in the event that cross-border trade is about to come to a halt. It certainly does not seem that way when self-serving British politicians fly in the face of all the evidence to argue that “the UK has agreed to hand over £40 billion of taxpayers’ money for two thirds of diddly squat … In adopting the Chequers proposals, we have gone into battle with the white flag fluttering over our leading tank.” Boris Johnson may know how to pen a decent newspaper column but as a frontline politician with a track record of deliverance he has been found wanting and he is as guilty as anyone of pouring fuel on the raging Brexit fire.

What the Brexiteers fail to understand is that the EU has little choice but to act in the way it does. It has consistently been made clear to the British government that access to the single market is based on the four freedoms of goods, services, labour and capital. The EU cannot therefore allow the UK to pick and choose. And whilst both sides agree on the need to maintain an open Irish border, the British proposals to realise this outcome are either unnecessarily complex or unworkable. But with just over six months until the UK leaves the EU, we need to see more flexibility – ideally from both sides – in order to generate the breathing space which can keep negotiations alive.

The UK government’s Chequers Plan clearly does not satisfy anyone domestically, nor in its current form is it acceptable to the EU. But it is the only idea on the table at the moment so it is the point from which we have to start. There have been some reports suggesting that Michel Barnier believes the plan to be ”dead” whilst others indicate that he sees some possibilities. One of the biggest sticking points is that the UK is not prepared to accept free movement of labour. But it may be possible to form a basis in law for a compromise which satisfies both sides. 

A fix for the freedom of movement problem 

As it currently stands the law grants residency rights to EU citizens irrespective of whether they work. For periods of less than three months the only requirement is that they possess a valid identity document or passport (although they may be required to register with the authorities – a requirement never imposed in the UK). For longer stays EU citizens and their family members “must have sufficient resources and sickness insurance to ensure that they do not become a burden on the social services of the host Member State during their stay.” But what if we were to impose quasi-freedom of movement in which the only restriction is that EU citizens require an employment offer before taking up residency?

Admittedly, it is not free movement as envisaged by the Lisbon Treaty but it is a good compromise. Moreover, articles 48 and 49 of the Treaty of Rome make it clear that cross-border flows of people were originally supposed to be conditional on an offer of employment. To enhance the fiction of “taking back control” the government can give the illusion that EU citizens be required to register – as is the case in Germany – via an application for a National Insurance number. In that sense, EU citizens working in the UK experience no obvious changes in their circumstances but the government sells a message that it has stiffened up border controls. Granted, it is far from ideal but it is a far better option than simply throwing up the drawbridge and would at least show that the British are trying to find a solution. 

The government has already proposed a solution for the Irish border 

With regard to Ireland, the UK government has already proposed a solution: The backstop plan outlined in June calls for a "temporary customs arrangement" which keeps the UK in a customs union with the EU for a limited period after the end of the proposed Brexit transition period in December 2020. At the same time, the government proposes that the UK be able to sign and ratify trade agreements with the rest of the world during the temporary arrangement. There are a couple of problems with this: (i) The EU has not (yet) agreed to it and (ii) Brexiteers do not like the idea because they are sold on the idea of leaving the customs union (Theresa May has tried to pacify them by suggesting that such a solution would only need to remain in place until end-2021).

But imagine that the EU does agree. The UK will find it extremely difficult to ratify any meaningful trade deals by end-2021 and thus continues to extend its membership of this arrangement. The longer the UK remains in the customs union, the less likely it is to want to drop out, resulting in a BINO solution (Brexit in name only) which is probably the least damaging economic option. 

They may be bad ideas but show us something better 

There are all sorts of reasons why these are thoroughly bad ideas. Like the Chequers Plan, they will satisfy neither leavers nor remainers. But they represent an attempt to reconcile the demands of the EU with the apparent need to respect the referendum result. And yes, they are politically devious solutions but Brexit is nothing other than a political issue and it is going to require some chicanery to extract the UK from the mess it has created for itself. But if Johnson or any other of the Brexit zealots has a better plan, we are all ears, because all we have heard so far is what is wrong with the current set of options. C’mon, show us what you’ve got!

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