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Three scenarios for delivering a soft-Brexit.

The last article I wrote on these pages dates back almost a year ago, two days after the Brexit referendum. My prediction, back then, was that the country was headed towards what is now called “a soft Brexit”, i.e. full access to the single market in a Norway-like deal. I also predicted that adherence to Schengen treaty would be part of the deal (probably, in exchange for financial passporting). After twelve months, I still stand by that prediction. In fact, I am so sure of it that I did not even bother applying for the paperwork that would give me the right to stay, as EU national or even as UK citizen.

The Brexit issue has not changed and will never change: the EU will not allow any deal that will reduce free movement of people. They just will not. Period. The UK have zero negotiating power and for the UK to walk without a deal would be an economic catastrophe. One really cannot overestimate the impact of losing access to the single market to this country’s economy in the short and medium term (in the long run we are all dead, anyway).

The last GE have prompted me to try and advance a few more predictions of what is going to happen next.

Did the Tories screw it up?

Yes, they did. However, the Tories biggest mistake was actually not to call the snap elections: their biggest mistake was to become the de facto bearers of the Brexit promise, which is a promise they could never, ever hold on to. The moment they took on the responsibility of delivering a Brexit is the moment they had taken their path to their certain failure. Consider this: Theresa May is seen as one of the most anti-immigrant politicians this country can currently sport. As the home office secretary, her policy on spousal VISA was utterly devastating; she never lost an opportunity to menace the students VISA, too. And yet, she campaigned for Remain because she knew too well what the economic consequences of leaving the single market would be.

After becoming prime minister, she bought some time delaying triggering of Art. 50 for as long as she could and then, after the very first meetings with EU counterparts, she suddenly realised that there was no way she could push the Brexit hoax any further in time. It takes about a year for a large company to relocate, so her pragmatical deadline to announce the final Brexit shape was going to be March 2018 – not 2019. To be calling a snap election now was strategically the best thing she could do for her own interest: polls were strong in her favour and by securing a new government she would have reset the electoral clock, gaining almost five years of possible electorate forgiveness & forgetfulness. Had her plans gone as she hoped, now the UK would have a strong Tory majority, a weakened SNP and a soft Brexit announced probably sometime around Christmas. Many hardcore Brexiteers voters would have been really unhappy with their Santa present, but the alternative of keeping the government and going to elections in 2019 would have been surely more damaging for the Conservatives.

That is not Theresa May’s version! She said she called the elections to gain a stronger negotiating position on Brexit.

Nonsense: there was and there is no way for her or for anyone else to strengthen the British negotiating position. The simple truth is that the UK have immensely more to lose from a hard Brexit than the EU have and, equally important, the EU have no political and strategical interest in the UK having anything that even remotely resembles like a good Brexit deal. This is a fundamental concept that should be very easy to understand but for some reason is not widely accepted. Perhaps an analogy may serve?

  1. You are Mr Juncker and you are walking with your happy family of 28 children on a Saturday afternoon. You pass by a marvellous toy shop and one of your children throws a huge tantrum because they want a big, shiny toy. What do you do?
  2. You are a bank. One of your customers decides that they do not want to pay the mortgage anymore and they want to strike a deal where they can still use some parts of the house by paying very little or no mortgage instead. You explain to them that is not a possibility. They reply: I will hold a consensus meeting with all my friends and relative. Having them on my side will strengthen my negotiating position.

It seems to me that the only person who is not able to understand this may be the current Secretary of Brexit. Which is not reinsuring, no matter how you look at it.

So, what happens now?

The first priority is clearly for someone to sort out the Brexit mess. As I mentioned, this really simply means announcing as soon as possible that we will pursue a soft-Brexit. Who will do this? There are three possible actors:

  1. The current government, led by Theresa May and sustained by DUP
  2. A new government, led by a large trans-lateral coalition including all parties and led by a moderate, respected Tory figure (Ken Clarke? Ruth Davidson?)
  3. A Labour minority government led by Corbyn. The Tories would have to “pledge” not to cast a vote of no-confidence

Option #3 is viable perhaps in theory but I really cannot see how it could be viable in reality. Would Corbyn really be so stupid to do so, knowing that he would not have the numbers to pass any point of his manifesto anyway? Why would he take the responsibility to deliver the Brexit failure? That is why I think that, at the moment, Corbyn is bluffing. Clearly, if the Tories MPs are smart they should do anything they can to push for option #3.

Option #2 would be the grown-ups scenario. It would be what is best for the country and in a way also what is best for both parties because they could still accuse each other. We would close down once and for all the Brexit shenanigans and then go to elections again. Polls withstanding, Corbyn would win comfortably but it would not be a landslide for Labour. However, this option would require May and her crew to come up and admit they made a terrible mistake and take one for the team. Will it happen?

Option number one is, without doubt, the best scenario for Labour and worst one for Tories: the Conservatives will get all the blame for the Brexit hoax, they will make fools of themselves for getting in bed with DUP and they will find themselves forced into calling a new election in the next few months, not for the DUP’s bigotry but because of what their alliance will mean for the Good Friday’s agreement. Corbyn would win that election with North Korean percentages.

Whether we end up with scenario 1, 2 or 3 the end result in terms of Brexit will be the same: Norway-like deal. The only thing that will change will be what kind of majority Corbyn will have when he will be PM, comes 2018.

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