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

June 20, 2017

How to soften Brexit?

The Brexit talks started yesterday with a focus on procedure. The UK has unsurprisingly dropped its irrational demand for parallel trade negotiations, and now accepts the EU’s timetable for the sequencing of the talks. The two sides set up three working groups: on the financial settlement, on citizen’s rights, and on other legal issues. The UK will present an offer on citizens’ rights next week. The two sides will negotiate for one week each month. Northern Ireland will be dealt with directly by the deputy negotiators.

This was not the confrontational start of the negotiations that some had expected, and there now seems to be on the UK side a desire for talks to end successfully. There is a still a lot of ill-informed debate about soft-vs-hard Brexit, which ignores the fact that the EU has accepted Theresa May’s negotiating mandate seeking a formal exit from both the customs union and the single market. We think that the probability of a change in the negotiating mandate is next to zero. What we think possible is an agreement on a sufficiently long transitional period, with the current arrangements in place, during which the EU and the UK would negotiate a closer partnership deal including a comprehensive FTA.

We note two comments this morning. George Soros notes that economic reality is beginning to catch up with false hopes. The moment of truth for the UK economy is fast approaching. UK households will have to adjust their spending downwards, and many households will discover that they have incurred too much debt, and will need to deleverage. This economic reality will inform the future of the Brexit debate. 

George Eaton goes into the politics, and notes that Labour’s commitment to ending free movement of labour should not be overinterpreted. They are prioritising the economy, not immigration. Free movement may end officially, and be replaced with something nearly identical. He notes that there is an overwhelming majority of opinion in the UK in favour of Brexit, but only a minority is in favour of a hard Brexit. This political reality will inform the UK’s negotiating position.

Show Comments Write a Comment

June 20, 2017

The deep roots of Brexit: Thatcher and the Germans

The FT offers a brilliant account of the declassified UK government papers detailing Thatcher’s attitudes to German unification. If you want to look for the deep origins of Brexit, the events of 1990 play an important part in the process of mutual alienation. 

There are two interesting aspects to this account. The first regards a phone call between Thatcher and former president George Bush, who was aghast at Thatcher’s suggestion to use the Soviet Union as a counterweight to Germany. Charles Powell, her private secretary, wrote a memo to her that Bush had failed to understand the subtlety of her position, and it was necessary for her to talk to the president in simple sentences, with as much repetition as possible. 

The second aspect relates to the famous Checkers’ seminar in March 1990, during which Thatcher met with some UK historians to discuss the German national character. There have been several accounts of this meeting, but Powell’s description is particularly brutal. The Germans were obsessed with themselves, he wrote, had an inclination to self-pity, and a longing to be liked. Powell lists the German traits in alphabetical order:

“angst, aggressiveness, assertiveness, bullying, egotism, inferiority complex, sentimentality... The overall message was unmistakable: we should be nice to the Germans. But even the optimists had some unease, not for the present and the immediate future, but for what might lie further down the road than we can yet see.”

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 19, 2017
  • Shadows of money
  • Breppe Grillo vs Eurointelligence
  • October 20, 2016
  • No games please, we are Europeans
  • 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
  • May 12, 2017
  • What to do with Germany’s tax windfall
  • How Macron counts on building a majority
  • Options for the eurozone
  • 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 05, 2018
  • Catalonia's government by Skype
  • The case for EEA membership
  • December 11, 2017
  • A new era for the French right
  • Growing scepticism of a grand coalition
  • November 24, 2017
  • Irish snap elections in January?
  • Alternatives to single market membership
  • Are the Irish bluffing?
  • November 08, 2017
  • Spain's attorney general personally sought pre-emptive prison for Catalan rebels
  • Spain's finance ministry to control Madrid city spending
  • National identity with a new twist
  • October 23, 2017
  • Macron's plans for the European Parliament
  • First phase of Brexit negotiations in final stretch
  • Why the left hates Europe
  • October 09, 2017
  • UK is starting to prepare for a no-deal Brexit
  • Why Germany will resist meaningful eurozone reform
  • September 25, 2017
  • Where does this leave eurozone governance reform?
  • Is Mélenchon losing his momentum?
  • Lost in Florence
  • September 13, 2017
  • Why the Turkey negotiations will continue
  • September 01, 2017
  • Rutte deflates Dutch labour party like a hot air balloon
  • August 21, 2017
  • Soft, getting softer
  • Tsipras' chances of a boost
  • On the fallacy of a middle-ground option for the eurozone
  • August 02, 2017
  • On the importance of a Brexit transition
  • To kill a referendum, starve it
  • How to spot a moron?
  • July 25, 2017
  • The impact of Duda's veto
  • How to undo Brexit
  • Front National: Frexit or not?
  • July 17, 2017
  • What Tony Blair's Brexit confusion tells us
  • Schulz advocates compulsory investments
  • Italy’s government has effectively lost its majority
  • July 11, 2017
  • The political fallout of the G20 in Germany
  • July 05, 2017
  • Europe’s next migration crisis
  • Philippe: French need to kick spending addiction
  • June 30, 2017
  • Recurring Brexit myths
  • On EU citizen rights
  • On Brexodus
  • June 26, 2017
  • Brexit - the central case and the tail-risk
  • The German fear of Macron
  • June 23, 2017
  • The offer, and what it says about the state of Brexit
  • Meet Germany’s next finance minister
  • When Greek drama meets French drama
  • June 21, 2017
  • Why has the SPD deflated?
  • Berlusconi’s strategy