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Tel. +44 (0)20 7287 4414
Email. info@brugesgroup.com
The Bruges Group spearheaded the intellectual battle to win a vote to leave the European Union and, above all, against the emergence of a centralised EU state.
The Bruges Group spearheaded the intellectual battle to win a vote to leave the European Union and, above all, against the emergence of a centralised EU state.
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‘No deal’ is our only remaining negotiating weapon; don’t decommission it.

Approaching the Wire at the Eleventh Hour

I have written about Brexit for a number of months now and basically my message has been the same: keep our collective nerve and hold out for a good deal. By a 'good deal' I mean one that allows us free trade with the EU – nothing more. No shady 'backstops', no mealy-mouthed words that allow the 'reject politicians' running the EU to maintain control of our economy, to insist on freedom of movement across our borders, and the right to send their fishing fleets into UK waters. We do not want to be governed by a Euro-court, nor do we want our Armed Forces subsumed into the political fiasco that will ultimately be the fate of any European Defence force – we are already members of NATO. We do not want to be subject to trade tariffs that are set in Brussels, nor do we want to be told with whom we can trade and under what conditions. We want a simple bilateral free trade agreement with the EU: something that is within the power of Brussels to deliver, should they so desire. The problem is that for political reasons, they refuse to agree. If we cannot secure this, then we should leave immediately, and without any form of negotiated agreement.

The EU has become increasingly nervous over the last six months, as they see the deadline for our withdrawal looming and note that we have not yet lost our collective nerve and given in to the 'bully-boy' tactics of Juncker, Barnier, Tusk and Verhofstadt. Anyone who has studied the track record of the EU when it comes to negotiation, will understand that they are bullies: see the comments made by Yanis Varoufakis (ex-Finance Minister for Greece) in his book Adults in the Room (Varoufakis, 2017). As with most bullies, they are also cowards, and if confronted will back down at the last minute. This is what I predict will happen with the Brexit negotiations: but only as long as the EU is not aided by the Brussels Fifth Column, and other anti-democratic groups within the UK - such as those who advocate a second referendum. We have wasted two years on so-called negotiations with the EU, even though they have admitted in public that they have no interest in negotiating anything with us. Michel Barnier let the proverbial cat out of the bag when he stated to a US news channel in June 2018: "What is sometimes hard for the British to understand is that we don't want to negotiate, we don't want to compromise…" (Rayner, 2018: 4).

To date, the EU has not been subject to the same internal pressures as have the UK negotiating team: after all, the EU negotiators are not accountable to anyone - never having been elected by popular vote in the first place. Contrast this with the UK team, who have faced a constant barrage of advice, criticism and complaint ever since the process started. Some complaints are undoubtedly made by people who are expressing their concern that a deal has not yet been reached – I understand (and sympathise with) the crippling uncertainty that this lack of clarity has brought to small-and-medium sized enterprise (SMEs), but I would not accept such excuses from large multinational companies. Most such major concerns have 'Planning Departments' whose sole function is to examine the changing trends (and uncertainties) in the macro environment: what business people like to refer to as a PEST (Poltical, Economic, Socio-Cultural, and Technological) analysis. At risk of incurring the wrath of British industry, I would ask what such departments have been doing – have they (as their function suggests) been examining various outcomes of the Brexit talk, and for each possible outcome, preparing an appropriate strategic plan? If not, then I am afraid that they have only themselves to blame for their lack of preparedness – there is no use whingeing that they have not been given sufficient information by the government. They should be proactive, and seek to identify the potential outcomes without waiting for a 'painting-by-numbers' guide to Brexit. For others, a more likely motivation is that they wish to sabotage the process and ultimately engineer the collapse of Brexit.

However, now that we are close to the wire, I think that the EU will realise the implications of a UK exit without a managed agreement ('no deal') for the bloc as a whole, and for individual nations in particular. It would be interesting to see the extent to which their current level of obduracy and arrogance is appreciated and supported by the peoples of Europe whom they claim to represent. I predict that if we do exit without a managed deal and exports from the EU to the UK (and vice versa) become more expensive as a consequence, those who have represented the EU in this farce will feel the wrath of EU-based industry and agriculture: in particular from Germany, France, and Italy. Furthermore, if the Brussels bully-boys attempt to make life difficult for UK tourists, they will have to answer to the Spanish, French, Greek, and Cypriot tourism authorities. Were it to prove increasingly difficult and bureaucratic for British tourists to holiday on the continent, many tourists would simply switch their destination: Florida, for example, is already a major destination for UK tourists, as indeed are Turkey and the UAE. Once people discover other destinations, the danger for countries such as Spain, France and Greece is that these tourists will never return.

Anyone for Negotiations?

Any negotiation must start with both sides laying out (publically) what they want and (privately) prioritising their 'lines in the sand' in order to first give way on the least important as part of this bargaining process. The UK's position is that whilst we want to remain good friends with the EU nation states, we do not want any formalised co-operation to go further than a tariff-free trade zone. After all, one does not have to get married to somebody to do business with them. That is the UK's position, and it is what many of us thought we were voting for in 1975 when we said that we wanted to remain in the then-EEC: a relationship based on trade, and nothing else. So far so good, but what does the EU want?

It is perhaps easier to say what they do not want. First and foremost, they do not want us to leave the EU. Their great fear is two-fold: one, that our departure will encourage other 'exits' by those European states that have large anti-EU parties and/or express growing anti-EU sentiment - such as France, Greece, Ireland, Poland, and Hungary. Second, when we leave, this will blow a large hole in the EU's income stream, leaving them with the choice of either charging each member state more, and/or spending less. The management of the EU is self-serving and corrupt: according to reliable sources ('Full fact'), the EU's accounts have not been totally 'fair and accurate' from 1996 to 2006; nor have they been 'free from material error' from 1994 to 2016 (O'Leary, 2017). Considering the amounts of money that flow in and out of the EU on an annual basis, fiscal accuracy and accountability should be of major concern, but this is not the case. The EU provides thousands of people with inflated salaries and expense accounts for doing what the EU wants, rather than what we (the people who fund this nonsense) want. Consequently, they are unlikely to curtail expenditure, as were they to do so, a large number of comparatively useless functionaries and 'reject politicians' would be unemployed, and the power base on which the EU hierarchy is built would crumble. Furthermore, they would be forced to abandon their ultimate objective of a socialist Empire of subservient nation states, manacled together into the United States of Europe (USE.). Where would the money for this extravagant expenditure come from? There is little or no likelihood that these reject politicians would ever agree to being subject to democratic accountability, and as such they are unlikely to ever change. This is why we arrived at Brexit. Many (myself included) would have preferred to remain within a European Free Trade Zone, and to fight the socialist super-state nonsense that comes with the EU's version of free trade from within. However, as has become increasingly apparent over the last three decades, the EU will not accept any reform: if the club will not reform, the only alternative is to leave the club.

EU expenditure is largely unaccountable in many areas: one of the most recent examples of fiscal corruption was to be found in the expenses claimed by Eurocrats: as Holehouse (2016:15) states: "Nearly all MEPs claim their entire expenses allowance, because European Union officials insist it would be too costly to ask for receipts." An investigation by 'access Info Europe' into MEPs expenses had to wait nearly three years to get data relating to expenses, and were then only given data relating to two months in 2016. From the data that was supplied, Juncker was reported to have claimed around €29,900 (around £22,610 at 2016 exchange rates) for a two month period, which included: "…€700 in daily allowances and more than €1,664 on accommodation. By far his most expensive trip was an official visit to Rome in late February [2016] which cost €19,395…" (Swinford, 2017:4-5).

Perhaps a more sinister motive behind EU expenditure, however, is to be found in the political direction of the education of European youth. In 2014 it was reported that Angela Merkel and others had published a document in which they had called for schools throughout the EU to 'nurture a European approach' and tackle 'Euroscepticism' (Waterfield, 2014: 15). This is dangerous ground for politicians to tread: "The politicising of young people into a directed way of thinking has unfortunate precursors in the shape of organisations such as the Communist Youth League of China, the Komosol of the Soviet Union, the 'Falangistas' of Franco's Spain, and the Hitler Youth in Germany" (Swift, 2016a: 46). These and similar EU 'initiatives' increasingly showed that reformation was impossible (and getting increasingly less likely) – so there was only one solution: to leave.

By now we should have come to an agreement over the terms of our leaving, yet apart from the 'Chequers Surrender Document' cobbled together by Mrs May (and if rumours are correct, dictated by Mrs Merkel), then there has been no real progress. Even this document could not really be described as representative of progress, as in effect its proposed terms mean we would remain under EU control, but without voting rights! Hardly an example of having escaped the clutches of Brussels. Charles Moore recently commented in The Daily Telegraph, that Mrs May's proposal "Lets us 'leave' but makes us stay in the EU trading arrangements, with even less power than now and no opportunity to make our own deals. It ensures, through the backstop, that these vassal arrangements will be permanent" (Moore, 2019: 22).

This was only to be expected as there is one group working towards Brexit (a loose coalition of those who voted 'leave'), but six groups working against Brexit: (1) the EU establishment, (2) those who voted 'remain' (in particular the Brussels Fifth Column Group), (3) the UK 'Establishment' (eg. Bank of England), (4) the International 'Establishment' (eg. the IMF), (5) the Prime Minister and senior members of the Cabinet such as Phillip Hammond, and (6) embittered back-bencher "remoaners" such Anna 'Sourberry' – as she is a former Barrister, I cannot help but question her apparent disrespect of UK law…. Or perhaps she feels that, as a member of the 'establishment' she is above the law?

Working against such odds, it is a wonder that David Davis and Dominic Raab achieved what they did. The reason why no agreement has been reached is that collectively the six anti-Brexit groupings, using their links to a largely remain-voting media, can exert more influence than can those who are trying to enact the will of the people. We (the Brexiteers) do, however, have one last card in our hand – that of leaving on 29th March without having come to any form of agreement – the so-called 'hard Brexit'. I consider this as the 'nuclear option', or weapon of last resort, and as such it should only be used if the enemy (the EU) is refusing to make any concessions. In terms of international trade, leaving without an agreed deal would mean that we would conduct cross-border trade according to the regulations laid down by the World Trade Organisation (WTO): and this includes the imposition of tariff charges on imported goods.

There has been much criticism of the 'no deal' scenario, with everyone from bankers, to politicians, large commercial concerns, and a plethora of smaller businesses and others complaining that they would be crippled by such an outcome. Most (if not all) of what I have read is either highly exaggerated, simple lies, or a consequence of the ignorance of the realities of international trade. The government has been trying to decommission the no-deal weapon for many months now: typically through the use of scare stories as to what would happen if we could not agree a deal with Brussels. For example, in October of last year it was reported that civil servants were discussing the possibility of a " … mass slaughter…" of sheep destined for the EU, if a no-deal Brexit meant that the channels ports were closed and/or subject to long delays (Williamson, 2018).A spokesman for the Welsh Farmers's Livestock Board was quoted as having said:

"Whilst we understand that the Government has to make contingency plans for every possible scenario in the event of a no-deal Brexit, this is just another stark reminder of the possible consequences of a no-deal. We would hope that whatever happens on Brexit day this scenario would never arise, however it should be a further wake up call for our Government negotiators to ensure that the UK comes to a reasonable deal with the EU; one that will allow us to continue to trade freely with our closest and most significant market."

A year later, the National Farmers Union (NFU) reported that, rather than slaughter, the government was now considering compensation: the obvious implication being that finance was at the centre of the decision. The EU threatened that it "… could take up to six months to authorise imports from UK food producers" (O'Carroll, 2019). This is obviously an example of threatening behaviour on the part of the EU – designed to influencing UK sheep farmers to put pressure on the UK government to avoid a 'no deal' outcome.

Interestingly, many of the so-called 'neutral' observers, whilst focussing on the negative effects to UK exporters of operating under WTO terms, fail to point out the practical implications of such a scenario. By this I mean that any tariff payment that UK exporters were forced to pay to access EU markets, would be equally matched by tariffs imposed on EU goods coming into the UK. I have lost track of the number of times it has been pointed out that the Balance of Payments (BoP) is in favour of the EU: ie they export to us far more than we export to them. The EU is scared that we will leave without a managed deal: therefore logic suggests that it is the only remain weapon we have that is feared by the EU. So-called negotiations have failed, as many of us predicted they would (Swift, 2018b).It comes down to a basic question of mathematics: in 2017, for example, "UK exports to EU, were £274 billion (44% of all UK exports). UK imports from the EU were £341 billion (53% of all UK imports)" (Ward, 2018). Thus, collectively, the EU has far more to fear from a tariff war than does the UK. As Lord Bamford (Chairman of JCB) said of leaving without a deal: "…I really don't think it would make a blind bit of difference to trade with Europe. There has been far too much scaremongering about things like jobs. I don't think it's in anyone's interest to stop trade. I don't think we or Brussels will put up trade barriers" (Farrell, 2015). JCB sells throughout the world, with large increases in sales recently in the Middle East. In Latin America alone JCB sells in 18 countries – including Argentina, Brazil, Chile, Colombia, and Mexico (The Guardian, 2015). And this, of course, is the point. The EU is highly unlikely to place tariffs on UK goods entering the EU – with or without an agreement, as they are fully aware that the UK would do the same to EU exports to the UK.

What critics of WTO-based trade cannot (or will not) see is that these are the terms on which the majority of the world trades, and has done for hundreds of years. Rather than the exception, WTO-based trading is the rule: the exception is to be found in trading within blocs such as the EU. Operating on WTO terms is not the end of the world as those opposed to a 'no deal' would have us believe. Nor should leaving the EU have a negative effect on personal travel as at very worst, we might be required to have a tourist visa. Unless the EU were to be deliberately awkward, obtaining a visa is not complicated: I travel regularly to Colombia: all that happens is I turn up at immigration at El Dorado Airport, Bogotá, and present my passport; I am asked the purpose of my visit, and a visa (generally 90 days) is stamped on my passport free of charge. The whole process takes about two minutes.

My point is that we have absolutely nothing to fear from trading on WTO terms, nor will lack of an agreement make holidaying more difficult in EU countries. It must be remembered that millions of UK visitors go to Spain and France every year; the respective tourist industries would lead an outcry if the Brussels bureaucrats were to make travel (for business and/or pleasure) more difficult. Millions of jobs in both these countries depend on UK visitors; just as the German car industry, and French agriculture depend on the UK as an export market. Put crudely, the EU cannot afford to lose tariff-free trade with the UK, and if this threat were seen to be real then a variety of industries throughout the EU states, would pressurise their respective governments to give the UK its free trade deal.

The real problem is that so far, pressure from UK industry has been apparent, as organisations seek to pressure the PM into arriving at a deal of sorts. Whatever one may think of the PM, she is still subject to Parliament; unlike the EU negotiating team who answer only to Juncker. It is this imbalance that has undoubtedly led many journalists and commentators to conclude that the UK is a weak and disorganised negotiator – and they are wrong. The problem is that we are negotiating with one hand tied behind our back – the constant barrage of criticism levelled againstthe UK – whilst the EU negotiators suffer no such disadvantage are they are not answerable to the populations of the countries they purport to represent. The only thing that will bring them to their senses is the thought of the UK leaving without a deal – and operating successfully on WTO terms, whilst European industry remains lumbered with uncompetitive practices, falling levels of GDP, unchecked immigration and social divisions (see the German experience in Cologne), coupled with high costs, and a moribund overly-bureaucratic system of government.

We need to maintain the option of a 'no deal' outcome; those MPs who seek to take this option away should be prepared to explain their actions to an angry British public should we be forced into accepting Mrs May's 'Scrap of Paper ' (Swift, 2018c), undertaking a second referendum, delaying Brexit, or scrapping Brexit altogether. None of these are acceptable alternatives to a clean break on 28th March: after all, 'no deal is better that a bad deal.'

Now where have I heard that before?

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References

Farrell, Sean (2015) "JCB boss says EU exit could lift burden of bureaucracy on UK businesses." The Guardian (17th May); https://www.theguardian.com/politics/2015/may/ 17/jcb-boss-says-eu-exit-could-lift-burden-of-bureaucracy-on-uk-businesses

Holehouse, Matthew (2016) "EU pays MEPs £40,000 a year in expenses, no receipts needed." The Daily Telegraph (2nd April), p.15

Moore, Charles (2019) "The deal is still bad – there is no reason for Brexiteers to compromise now." The Daily Telegraph (9th March), p. 22

O'Carroll, Lisa (2019) "Pay farmers to avoid cull of lambs after no-deal Brexit, union says

National Farmers Union warns of crisis if sheep farmers cannot export meat after 29 March."

The Guardian (20th February); https://www.theguardian.com/environment/2019/feb/20/ farmers-lamb-culling-no-deal-brexit-exports-union

O'Leary, Joseph (2017) "Is the EU's budget 'signed off' by auditors." Full Fact (2nd November); https://fullfact.org/europe/did-auditors-sign-eu-budget/

Rayner, Gordon (2018) "Barnier: We don't want to negotiate with UK." The Daily Telegraph (2nd June), p.4

Swift, Jonathan S. (2018a) Brexit KBO. Cambridge Academic, Cambridge. ISBN: 1-903-499-94-1

Swift, Jonathan S. (2018b) "Go Now: Leave the EU immediately and without a deal."The Bruges Group (Blog: 20th June); https//www. Thebrugesgroup.com/blog/go-now-call-brussels-bluff-and-leave-the-eu-immediately-and-without-a-deal

Swift, Jonathan S. (2018c) "Mrs May's 'Scrap of Paper': will it be 'Peace for our Time'?"The Bruges Group (Blog: 17th July); https//www.brugesgroup.com/blog/mrs-may-s-scrap-of-paper-will-it-be-peace-for-our-time

Swinford, Steven (2017) "How EU tried to hide £500,000 bill for two month's travel." The Daily Telegraph (10th August), pp. 4-5

The Guardian (2015) "Why JCB's head honcho is backing the Brexit." The Guardian (18th May); https://www.theguardian.com/politics/shortcuts/2015/may/18/why-lord-bamford-jcb-backing-eu-brexit-multi-millionaire

Varoufakis, Yanis (2017) Adults in the Room: my Battle with Europe's Deep Establishment. The Bodley Head, London. ISBN: 9781847924469

Ward, Matthew (2018) "Statistics on UK-EU Trade." Commons Briefing Papers (CBP – 7851(30thNovember); https://researchbriefings.parliament.uk/ResearchBriefings/Summary/ CBP-7851

Waterfield, Bruno (2014) "Get them young: Merkel plans EU education." The Daily Telegraph (8th March), p. 20.

Williamson, David (2018) "Whitehall considering 'mass slaughter' of sheep heading for EU if there's a no-deal Brexit." WalesOnline (11th October); https://www.walesonline.co.uk/ news/politics/ whitehall-considering-mass-slaughter-sheep-15263463

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Comments 1

Guest - Adam Hiley on Saturday, 16 March 2019 19:11

May has to go and a clearout of Parliament of Remoaners needs to happen No deal is still likely britishconstitutiongroup.com , eutruth.org.uk davidmurrin.co.uk

May has to go and a clearout of Parliament of Remoaners needs to happen No deal is still likely britishconstitutiongroup.com , eutruth.org.uk davidmurrin.co.uk
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