Three Monday Morning Brexit-Speech Thoughts

Three thoughts after reading the UK Prime Minister’s Brexit speech.

  1. This is the opening salvo of a negotiation. Everything needs to be understood (and therefore, deflated) in this context.
  2. In different places in the speech, Mrs May is talking about restricting immigration *and* having unrestricted free trade. This is a nonsense, and it won’t work. Her description of the process also completely underestimates the negotiating power of the EU. For example, Mrs May said she wants to give “British companies the maximum freedom to trade and operate in the single market”, but not at the expense of allowing free movement of workers for these companies or accepting the power of the European Court of Justice. Best of luck with that.
  3. Beyond rallying the troops a bit, and giving a timeline, there’s little in the speech for Ireland, news-wise, apart from what seems like a very firm decision to negotiate as a United Kingdom–meaning our friends up North and in Scotland are in a bit of trouble as there will likely be fewer border-related concessions for them in the context of a ‘hard’ Brexit.



Author: Stephen Kinsella

Senior Lecturer in Economics at the University of Limerick.

15 thoughts on “Three Monday Morning Brexit-Speech Thoughts”

  1. I found this Spectator link the easiest to follow. Others may be in the same situation.

    No real suprises, as you say, but two significant confirmations (i) a date for activation of Article 50 and (ii) that there will be no unilateral launching by the UK into the unknown (as desired by the more extreme Tory elements as the ultimate negotiating tactic or, at least, the threat of it).

    Otherwise, no firm information on the exact detail of what the UK will seek, using a feeble justification of not showing the UK’s hand (when most in the EU think that it has no hand worth talking about other than the general desire of economic interests in the EU27 to maintain these undisturbed as much as possible).

    A key question mark relates to those elements in the eventual UK negotiating position which MUST be clarified in order to have a logical basis for any discussion. One of the most obvious is whether or not the UK intends to stay in the Customs Union. It and the Single Market (more correctly the “internal market”) are assumed to be synonymous when they are not.

  2. It appears that the Brexiters and the UK media believe that Theresa May supports a hard Brexit and that is the realistic outcome if the UK government wants to have control on immigration. The appointment of 3 Leave campaigners to handle the negotiations with Europe may have been partly to let them take responsibility for failure but if May wants to compromise against their wishes, she would be exposed.

    May was the minister responsible for immigration control for 6 years and the failure of the Cameron government to meet its published inflow targets was a significant factor in the Brexit victory.

    Philip Hammond, the chancellor, appears to be the only senior minister who is interested in a compromise while the divided Labour Party having lost Scotland, is also making noises about immigration given that a third of its 2015 9m voters supported Leave a year later.

    Hammond says immigration controls may not block access to single market and while a fudge is possible, getting unanimity from the EU27 countries, and Theresa May risking renewing the split in the Tories on Europe, are very unlikely.

    For Ireland it should plan for a hard Brexit and there needs to be some fresh thinking that is a bit more serious than slogans such as a ‘Brexit-proofed’ Budget.

  3. I engaged a bit over the evening on some Scottish indyref blogs. There is a massive amount of delusion, confusion and wishful thinking there, to match the “we must have our cake and eat it” brexit down south. However, we can envisage an independent Scotland on the world stage, perhaps even within the EU if they get the timing right (and sooth the feathers of the Spanish in particular).

    What is, to me, incomprehensible, is an independent NI. Maybe I’m just blinkered. So, the big question facing us all now is this : how badly will NI get creamed by Brexit? Will it be a creaming or, to use the concept from the late Prof Pratchett, a cheesing – like a creaming but lasts longer and is much harder. To what extent does that fan the embers of social and civil strife?

  4. Just wondering. The European migration crisis (that’s too mild an adjective to really describe the situation) may be the effective outcome of several causative factors, for instance local and regional civil disturbances and the contemporaneous slow deterioration of our globalized economy. Any guesses?

    The idea of ‘free movement of persons’ – how-so-ever you define this, may be fine and dandy in principle but is likely to prove very contentious in practice – that is, where there are significant economic and cultural differences with the indigenous populations of the countries the migrants are moving into. Europe is a multi-lingual economic area – and there are fierce, historical, political divergencies. These matters are rather un-bridgeable – except perhaps over three or four generations. And even then we have direct experience from the UK and France just how problematic social, cultural and economic integrations can be.

    These issues of long-term economic and social integrations may have temporarily dispersed (like a swirling fog) but they have not gone away. And they seem to be returning with a vengance; a situation which could have been foreseen. Maybe the political memories of different European societies were lost or supressed when the older generations passed away, but a new festering mindset about an old issue is now gestating in the current generation. I’d be awful careful about this matter. I’d treat it with all the care and respect that I would bestow on a container of tri-nitroglycerine that was being slowly warmed-up over a naked flame: its treacherous and predictably devastating.

    It just may be that some folk in Britland have copped onto the idea that the global economy is in bad trouble and that the last thing they need in Britland is an increase in their working age population caused by economic migration of poorly educated and economically dependent folk. The UK economy is just not going to be able to absorb them – unless its starts to expand at a rate of 7% p/a for a decade or more. Not possible. Ain’t gonna happen. Hence, most of the arriving economic migrants will simply become un-employed or under-employed and would be a nett welfare burden.

    Norn Island? Sure, its comfortably embedded on a virtual Tectonic plate which will instantaneously detatch itself from the lower part of this island and shift effortlessly (on request, you understand) the short distance to the east and magically fuse with Scotty Land 🙂

  5. Gideon Rachman….. Theresa May walks into Brexit trap.. 3rd October.

    Gideon has poor things to say about this opening move. Basically it is an attempt at politics for Mrs May to placate the hard line brexiters within her party, in other words looking after her own seat.

    There are two years to negotiate a parting of ways. Once they have sorted out who gets what out of the EU wine cellar and various art work which is partly owned by the UK Brexit should then be completed in early 2019.

    After 2019 they have all eternity remaining to negotiate new trade deals with the rest of the world and EU.

    We are witnessing the hijacking of a nation by ideologists who have fooled themselves into thinking politics will always trump reality.

    Its happened before, and it will happen again, unfortunately.

  6. May’s speech was essentially inevitable – what else could she have said?

    Here is a narrow thought experiment for you.

    Suppose the UK were to say that it had no option, given the vote, but to impose some fairly modest restrictions on numbers of certain categories of immigrants from the EU, and that it was leaving because the UK government believed it had to do that.

    Cameron tried to negotiate something like that, but failed. Had he tried a couple of years later he might have succeeded – who knows.

    Anyway, in our experiment, this ‘free movement of people’ aspect is the only substantial item.

    How enthusiastic would you be for the imposition of trade tariffs between the EU and UK as a price both the UK and EU must pay because the UK would no longer being a member of the club which, for the moment, allows ‘free movement’, and which must have its honour and integrity maintained?

    Now imagine it wasn’t the UK, (or Britain, or even more antagonistically “the English”) with the attendant shallowly repressed urge to teach them a lesson that they don’t have any power any more. Lets pretend it was Portugal, or somewhere – but with way, way, more importance for Irish trade. Ask yourself the question again.

    For JCJ the answer is 100%. How do you compare?

    1. You are tying yourself in knots. The four freedoms are the very foundation of the EU. Without them, it collapses, especially following the introduction of a single currency by the major economies, other than, of course, the UK.
      It is is as simple as that.
      The “be reasonable, do it our way” attitude of the British has come to its inevitable dead end.
      Some kind of a “bespoke” deal will be worked out. It will not be pretty. But it will work. The UK will be one of the odd men out in Europe i.e. in the company of Norway and Lichtenstein.
      Ireland’s objective is the obvious one of not being dragged into the same company. Such is the lack of any real attachment nationally to the EU, and even less understanding of how it works, the risk that this may happen remains high. Were it not for the fact that Ireland has adopted the euro, it would almost be an inevitability.

  7. The chimera that is Brexit is rather coldly exposed in PM May’s own words:

    “As we repeal the European Communities Act, we will convert the ‘acquis’ – that is, the body of existing EU law – into British law. When the Great Repeal Bill is given Royal Assent, Parliament will be free – subject to international agreements and treaties with other countries and the EU on matters such as trade – to amend, repeal and improve any law it chooses. But by converting the acquis into British law, we will give businesses and workers maximum certainty as we leave the European Union. The same rules and laws will apply to them after Brexit as they did before.”

    The key words are ‘subject to treaties with the EU’. In other words, the mother of parliaments won’t be free to make laws in relation to whatever access the UK has to the internal market, and the Court interpreting the laws will still be in Luxembourg. And all the existing acquis will be converted into British law. So what exactly was Brexit for?

    1. The wording is a bit ambiguous but the intent is clear (i) to reassure markets that the UK remains committed to abiding by its intergovernmental treaties (including the eventual one with the EU) (ii) to head off the “clean break” fantasists among the Tories for whom such legal matters are incidental.

      What the UK is repudiating, as is clear from other elements of her speech, is the supremacy of EU law i.e. its supranational character and the institutions that allow for this. The UK alone will be in charge of converting the EU acquis to national legislation.

      There is, of course, the fact that the UK will remain bound by other forms of international legal arbitration, as will certainly also be the case with regard to any agreement it reaches with the EU 27.

  8. Given the severity of the situation (economic ramifications) for Northern Ireland, in addition too the fact that the N.I. people voted to remain (majority).

    I wonder will we see a vote for a united Ireland in the near future.

    The double speak of Northern Ireland Unionism is being shown up again for what it is.

    If Ireland were to be reunited….. could Irish finances cope? What would our tax rate have to increase by to fund both jurisdictions?

  9. Modern economics is based on the notion of the rational agent, the person who takes rational decisions to maximise revenues. And Brexit destroys it. And how will economists respond? We will need bigger fag packets .

  10. Meanwhile Spain has announced at the UN that it has “formally invited the UK to open negotiations enabling us to reach an agreement so that the provisions of the EU Treaties may continue to apply to Gibraltar….. We would like to reach an agreement with the UK on a joint sovereignty system which would enable Gibraltar to stay in the EU”.

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