June 13, 2017
A back channel for Brexit
We have been optimistic on the UK, in comparison with most commentators. We never really believed that the UK would voluntarily leave the EU without an Article 50 deal. And we also think that Theresa May will remain as PM during the Brexit negotiations and, who knows, possibly beyond. Events yesterday seem to confirm our two central views on the UK. Her meeting with the backbenchers of her party went well, and the talk about a leadership challenge has disappeared - for now. And, as the Daily Telegraph reports this morning, senior cabinet ministers have opened backchannels with Labour MPs to secure cross-party backing for a Brexit agreement.
William (now Lord) Hague, the former Tory leader, yesterday outlined what such a deal could look like - it is very close to our own view of a reasonable Brexit trajectory. He proposes a transitional period with continued membership in the single market and the customs union, lasting two years. (We think it could, and should, last longer). And he proposes an immigration system under which the UK would grant an obligatory work permit to EU citizens - but without the right to social benefits. The Guardian reports that May is also considering revising her immigration targets, but excluding foreign students, and dropping the numerical ceiling of "tens of thousands".
We agree with Michel Barnier that the distinction between hard and soft Brexit is essentially meaningless - in fact it is sign of a series of misunderstandings of how the process works. There are three separate, though interlocking, issues: the Article 50 deal; the nature and length of the transitional period; and the final Free Trade Agreement. Single adjectives do not do justice to the large number of possible combinations.