We use cookies to help improve and maintain our site. More information.
close

July 07, 2016

Article 50 without recourse to parliament

Newspapers all over Europe are today filled with coverage of the Chilcot inquiry, a subject we happily leave outside our reservation. Brexit, however, remains at the top of our agenda given the enormity of its implications.

There was an interesting tweet yesterday by Denis MacShane, according to which only two people in a crowd of exclusively pro-European gathering in London believed that Brexit will actually happen. We wrote yesterday that the still delusional Remain supporters will get their second shock when the political reality of Brexit sets in. It now appears that the government machinery is being re-programmed for Brexit, and will be pursuing that direction with relentless determination.

The Guardian reports on a statement by Oliver Letwin, a cabinet minister in the Cameron administration in charge of the preparatory work for the Brexit negotiations. He told a parliamentary committee that the government has received legal advice that Art 50 can be triggered by royal prerogative, which means without further recourse to parliament. 

While this also accords with our own view, this is an important development nevertheless, as the "Bremain" illusion largely rest on one of three notions. The first is that parliament can, and will, block the triggering of Art 50. The second is that parliament will refuse to accept the negotiated outcome. The third is that parliament will instruct the government to undo the Art 50 process once triggered. Letwin said MPs would, of course, be involved in the process, since the procedure will require the repeal of the European Communities Act 1972. Letwin's office will prepare what he calls a "fine grained, multi-dimensional" options paper in time for September 9, when the new prime minister is to be installed.

Today is the final vote in the pre-selection process among Tory MPs, who will determine the two remaining candidates - out of three - to be voted on by Conservative Party members. The Guardian article also contained information about another piece of legal advice relating to whether an Art 50 process can be undone. It appears that the French government has received legal advice that this would indeed be possible (but would obviously have to occur within the two-year timeframe set by the article). 

We noted one story this morning in Frankfurter Allgemeine according to which the UK has given up its resistance to opening up the next chapters in Serbia's membership negotiations. At a meeting of the Western Balkan conference in Paris, Britain had signalled that it would no longer block Serbia's and Montenegro's EU accessions - which are pencilled in for 2020. Another case of the Brexit facts already happening on the ground. Britain is now giving up on long-held positions on EU policy. 

In the UK, meanwhile, more property funds withheld redemptions - now six altogether - which means that around half of the entire sector is now frozen. To raise the cash to pay out investors they will need to sell properties, which means that the UK's bubbly commercial property sector is going to be deflated as a result of Brexit. There is already anecdotal evidence of a fall in residential property prices, as people are holding off purchases until there is more clarity on the way ahead. While it appears that the UK will not deport any EU residents after Brexit, immigration controls will reduce demand for properties in the long run, relative to pre-Brexit baseline projections. The combination of current uncertainty and expectations of relatively lower demand in the future will have a profound impact on the sector. Note, though, that excess demand will prevail for some time. 

We disagree with George Magnus' gloom on the British economy. He writes Sterling is the bellwether of the coming recession, not the FTSE100 index. We agree with him on the FTSE, but the fall in sterling will act as a stabiliser. But even Magnus does not seem to believe in a depression, and says that the UK will emerge from the coming recession in 2017-18. More worrying is that the recession will have medium-to-long-term effects, as a consequence of Brexit affecting trade, investment and immigration.

And finally, it is worth reading Tim Harford's thoughtful piece on the role of expert advice during political campaigns. The economics profession was nearly unanimous in its forecast of impending disaster following a Brexit vote - a forecast that we all now have the pleasure, or misfortune, of seeing either vindicated or refuted. Harford's broader point is that expert advice is needed especially at a time when facts are distorted, but he also quoted Paul Johnson, head of the Institute of Fiscal Studies, saying that it was too easy to point to the media as a scapegoat. The economics profession also has a lot to answer for.

Show Comments Write a Comment

July 07, 2016

Juncker's U-turn on the Canada agreement

Hendrik Kafsack has an angry comment in the Frankfurter Allgmeine on Jean-Claude Juncker's mishandling on the Canada trade deal. He provoked an outcry with a casual remark that the EU would legislate the deal without involvement of national parliaments. He now backtracked completely, saying that he could not care less how is ratifying it. Kafsak said this is now putting the deal at risk, since the Walloon parliament in Belgium has already voted against it. Belgium is a country where parliamentary ratification requires the assent of the regional assemblies, so this vote effectively means that a regional assembly of 4m people are vetoing a European trade deal. This will set a precedent for the TTIP negotiations as well. Kafsack argues there is no case for national involvement since trade policy is an EU prerogative. 

Show Comments Write a Comment

July 07, 2016

Left gives up on opposition to El Khomri law

A censure motion against Manuel Valls failed yesterday, an initiative from greens, communists, and some of the socialist rebels after Valls announced the labour reform law would be pushed through using article 49-3. The opponents were two signatures short of what was required for the motion to go ahead, as they only got 56 instead of 58. Les Échos writes that many labour reform opponents no longer wanted to rock the boat before the primaries. They concluded that it is no longer worth it to risk being excluded from the PS. The more important question is to chose their candidate for the presidential election, which is far from straightforward.

As for the other potential candidates there is some movement too. Nicolas Hulot, the well known environmentalist who ran for the greens last time, took himself out of the race. Emmanuel Macron, meanwhile, is readying himself to enter the race. Macron will campaign for a new political approach, parallel to François Hollande's. The question right now is when he will quit the government. Not now, but soon, according to Journal du Dimanche.

Show Comments Write a Comment

This is the public section of the Eurointelligence Professional Briefing, which focuses on the geopolitical aspects of our news coverage. It appears daily at 2pm CET. The full briefing, which appears at 9am CET, is only available to subscribers. Please click here for a free trial, and here for the Eurointelligence home page.

 

Recent News

  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • October 18, 2017
  • Veneto and Lombardy to vote on autonomy
  • Portugal's president calls on government over fires
  • Radical ideas for radical times: how to pay off public debt
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • October 03, 2017
  • A short note about UK politics
  • The impact of the German elections on the euro debate
  • The decline and fall of Martin Schulz and the SPD
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • September 18, 2017
  • Why Germany cannot lead Europe, let alone the free world
  • Will Macron help to build up Mélenchon?
  • Boris' Coup
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • September 01, 2017
  • Rutte deflates Dutch labour party like a hot air balloon
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • August 21, 2017
  • Soft, getting softer
  • Tsipras' chances of a boost
  • On the fallacy of a middle-ground option for the eurozone
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • July 28, 2017
  • German government bans Porsche Cayenne
  • More troubles for the AfD
  • Of course there will be a soft transitional period for the UK
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • July 10, 2017
  • EU in self-destruction mode
  • The EU's fault lines
  • Fake News and Fake views
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • June 21, 2017
  • Why has the SPD deflated?
  • Berlusconi’s strategy
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • June 01, 2017
  • On how to fix the eurozone
  • What happens if there is no Article 50 agreement?
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • May 11, 2017
  • Germany rejects IMF’s policy recommendations before they are issued
  • Why Labour is losing
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • April 20, 2017
  • Don’t bet on Trump turning globalist
  • A note on UK election polls
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • March 27, 2017
  • Governing formation troubles - Northern Ireland edition
  • Did Trump present Merkel with a bill for Nato?
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • January 08, 2018
  • Getting real on Brexit
  • Macron in China
  • March 02, 2017
  • Juncker's scenarios for Europe
  • EU minimum wages are rising
  • No, the Lords didn’t stop Brexit
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • November 15, 2017
  • A Christmas bonus for poor Greeks
  • Dim prospects of negotiated de-escalation on Catalonia
  • Macron's favourite to succeed Juncker - first round
  • On sovereignty
  • Gli Azzurri
  • February 03, 2017
  • The Schulz effect is getting huge
  • The post-Brexit boom goes on and on and on
  • A correction on Catalonia
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • September 18, 2017
  • Why Germany cannot lead Europe, let alone the free world
  • Will Macron help to build up Mélenchon?
  • Boris' Coup
  • January 05, 2017
  • French Socialist primaries - old wine in new bottles
  • Le Pen's hard ecu
  • Will Tusk get a second mandate?
  • Themes of 2017
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • July 10, 2017
  • EU in self-destruction mode
  • The EU's fault lines
  • Fake News and Fake views
  • December 01, 2016
  • Will Italian expats swing the referendum result?
  • Why we keep on misreading the polls
  • Si vis pactum, para bellum
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • October 23, 2017
  • Macron's plans for the European Parliament
  • First phase of Brexit negotiations in final stretch
  • Why the left hates Europe
  • April 23, 2017
  • The demise of the AfD has accelerated dramatically
  • On how France will need to confront Germany
  • October 24, 2016
  • Ceta - the next deadline
  • Who will lead Germany?
  • Peasant party upsets Lithuanian election
  • Ségolène Royal, seriously?
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • September 22, 2017
  • The last German polls
  • May 15, 2017
  • SPD and CDU disagree on how to respond to Macron
  • Was Rajoy blackmailed?
  • The rise of the re-leavers
  • January 05, 2017
  • French Socialist primaries - old wine in new bottles
  • Le Pen's hard ecu
  • Will Tusk get a second mandate?
  • Themes of 2017
  • August 30, 2016
  • Brexit facts on the ground
  • Burkinis and Republican primaries
  • The SPD and TTIP
  • April 25, 2016
  • The death of the Grand Coalition
  • Insurrection against TTIP
  • Juppé to benefit from Macron hype
  • On optimal currency areas
  • Why the Artic region could be the next geopolitical troublespot
  • From a currency to a people
  • January 16, 2018
  • Towards a radicalisation of Les Républicains?
  • EU toughens its position on Brexit transition
  • December 15, 2017
  • Amendment 9 conundrum
  • The negligible GDP impact of the single market
  • November 15, 2017
  • A Christmas bonus for poor Greeks
  • Dim prospects of negotiated de-escalation on Catalonia
  • Macron's favourite to succeed Juncker - first round
  • On sovereignty
  • Gli Azzurri
  • October 16, 2017
  • What‘s the deep meaning of the elections in Lower Saxony?
  • Can Brexit be revoked?
  • Macron's grand narrative
  • September 18, 2017
  • Why Germany cannot lead Europe, let alone the free world
  • Will Macron help to build up Mélenchon?
  • Boris' Coup
  • August 21, 2017
  • Soft, getting softer
  • Tsipras' chances of a boost
  • On the fallacy of a middle-ground option for the eurozone
  • July 25, 2017
  • The impact of Duda's veto
  • How to undo Brexit
  • Front National: Frexit or not?
  • June 30, 2017
  • Recurring Brexit myths
  • On EU citizen rights
  • On Brexodus
  • June 05, 2017
  • What happens to Brexit if Labour wins?
  • What Russia wants
  • May 11, 2017
  • Germany rejects IMF’s policy recommendations before they are issued
  • Why Labour is losing
  • April 19, 2017
  • Shadows of money
  • Breppe Grillo vs Eurointelligence
  • March 27, 2017
  • Governing formation troubles - Northern Ireland edition
  • Did Trump present Merkel with a bill for Nato?
  • March 05, 2017
  • Poland vs Tusk
  • Juppé - a recovered candidate?
  • Will Italy leave the euro?
  • February 13, 2017
  • What decides the French elections: cult or programme?
  • Sense and nonsense on globalisation
  • Towards the next European crisis
  • January 23, 2017
  • What if the populists clash with one another?
  • Why the euro is a real problem for the German left
  • When you call the US, what number do you dial?
  • January 05, 2017
  • French Socialist primaries - old wine in new bottles
  • Le Pen's hard ecu
  • Will Tusk get a second mandate?
  • Themes of 2017
  • December 07, 2016
  • Matterella says No to early elections
  • Looking for alternatives to Valls?
  • Local taxes and citizenship in Ireland
  • Brexit contours
  • November 21, 2016
  • Merkel IV
  • Erdogan increasingly alienated from the West
  • EU may force a hard Brexit
  • The day after
  • November 07, 2016
  • Why UK elections are becoming more likely
  • The EU's moral bankruptcy on Turkey
  • Merkel's presidential mess
  • The case for a No vote in Italy
  • October 24, 2016
  • Ceta - the next deadline
  • Who will lead Germany?
  • Peasant party upsets Lithuanian election
  • Ségolène Royal, seriously?
  • October 11, 2016
  • Towards the fifty-first state
  • Brexit and Northern Ireland
  • Enemies of the state
  • September 30, 2016
  • High drama in the PSOE
  • What happened to Montebourg?
  • Why a hard Brexit is not inevitable
  • September 19, 2016
  • Unhappy in Bratislava
  • Au nom du peuple
  • Pressure rising towards a hard Brexit
  • September 08, 2016
  • Le Pen leads and Macron comes third in polls
  • Corbyn wants out of the single market
  • Is Renzi's strategy plausible?
  • August 30, 2016
  • Brexit facts on the ground
  • Burkinis and Republican primaries
  • The SPD and TTIP
  • August 22, 2016
  • Gold for Brexit
  • EU and Turkey talking past each other
  • Switzerland is the next migrant transit country
  • On the death of neoliberal economics
  • August 15, 2016
  • Sarkozy to declare his candidacy
  • Do intra-eurozone current account deficits matter?
  • On the failures of modern macroeconomics
  • July 26, 2016
  • The limits of May's freedom of manoeuvre
  • Don't misread the lack of visible panic in Germany
  • July 18, 2016
  • What now in Turkey?
  • French politics after Nice
  • How to address the Scottish question?
  • What Brexit means
  • July 14, 2016
  • Meet Her Majesty's Principal Secretary of State for Leaving the European Union
  • SPD to veto TTIP
  • Spanish government gridlock continues
  • Hollande's hairdresser
  • July 11, 2016
  • Towards Brexit outside the EEA
  • On the EU's deteriorating relationship with Russia
  • July 08, 2016
  • Party logic requires both Tory candidates to deliver Brexit
  • Watch out for signs of discord within Germany about how to confront Russia
  • The secret plans of Yanis Varoufakis