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October 05, 2018

What to make of the Anglo-Irish approximation on the backstop?

There is a fundamental trade-off in the debate over the Irish backstop. The greater the concession Theresa May is willing to make, the greater the backlash in her own ranks, and by the DUP. But it appears that May is pressing doggedly ahead with the compromise that has been flagged for some time - a quasi-customs-union deal that keeps the inner-Irish border open and allows for some regulatory controls in the Irish Sea, or at UK mainland sea ports. 

The Irish Times writes that the Irish government has received word that an official British proposal is expected in the next few days. It quotes four senior sources in Dublin who say they have been encouraged to believe that May would be offering a significant proposal on the backstop. Leo Varadkar is expected to hold talks with Michel Barnier this week, ahead of the next EU summit in two weeks' time. 

The FT writes that one of the proposals May is working on is for the whole of the UK to participate in the customs union. We are not sure whether this entails full compliance with EU regulations during that period, or whether this is still the Chequers version of the customs union. We will need to see the details of this proposal to see how far this goes. It could be a time-limited customs union followed by a process of divergence after a certain period of time, contingent on technical developments. 

One potential obstacle for Dublin, according to the Irish Times, is May’s insistence that any future regulatory divergence between the UK mainland and Northern Ireland would have to be approved by the Stormont Assembly. We noted in an earlier report that May had mentioned this in her last bilateral with Varadkar, and we also believe that she gave assurances to Arlene Foster in this respect. This could be a real problem because it would give the DUP an effective veto over the process.

And, even if Dublin were to accept the UK’s proposal on this basis, it is not clear that the EU would accept it. As misunderstood by many observers, this is not a customs union agreement but still the hybrid Chequers version that extricates the UK services from the single market. We believe that May will have to move further, but we have not seen much movement yet. If the promise of regulatory checks in the Irish Channel were counter-balanced by giving Stormont the final say on future divergence, we are not sure that this will interpreted as a big move. And we do not detect movement on the EU side either. 

We noted a tweet by Michael Savage, polical editor of the Observer, who writes that already 34 MPs have signed up to the #StandUp4Brexit campaign, which lines up behind Boris Johnson’s slogan to chuck Chequers. He notes:

“If there is a further pivot towards a compromise with the EU, that will grow. There is no dance that can win these MPs over.”

This is the fundamental tradeoff. And it also is possible that the EU rejects even a modified version of the proposal. Donald Tusk reiterated the EU’s version of a Canada-plus type deal, a comment immediately seized on by Boris Johnson and Jacob Rees-Mogg, who have also called for this type of agreement. The big difference, however, is that the EU wants a Canada deal with a full Irish backstop in place - which would keep Northern Ireland in the customs union and the single market. This is why Canada is non-starter. There is already talk in the UK about EU annexation of Northern Ireland. The only scheme capable of being agreed and ratified would a time-limited customs union, full-Monty-style, followed by some tech-contingent future divergence. But the risk of a no-deal Brexit remain significant. 

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October 05, 2018

Macron's launches charm offensive but gives offence nevertheless

Emmanuel Macron is not only struggling to find a competent successor for Gérard Collomb to overcome the political crisis in the government. His charm offensive with the public is not going too well either. Earlier this week, a photo went viral on social media showing with him arm-in-arm with two young men on the island of St Martin, one of them bare-chested and showing the middle finger. Marine Le Pen did not miss the chance to express her vocal indignation, saying that France does not deserve this. Macron's brave response was that he loves all children of France no matter how troubled their past — one of the two youngsters had done some prison time.   

The second and probably more damaging incident, a classic Macron of-the-cuff comment, occurred yesterday. This time it involved pensioners, a group where Macron's polling rates has collapsed anyway. At a ceremony in tribute to De Gaulle for the 60th anniversary of the French constitution, the president found himself surrounded with pensioners complaining that their pensions were less as a result of his policies. Macron responded by sharing something De Gaulle's grandson, he said, had told him recently about a favourite expression of his grandfather: 

"You can speak freely, the only thing we should not do is to complain. I think that the general had the right idea. The country would be different if everyone took a leaf out of his book... We don't realise how lucky we are. We are seeing more and more elderly people in our country in good health."

Never complain, never explain, has been a favourite maxim among stiff-upper-lips Brits. It may be a good maxim to live by. But it is unwise for Macron to lecture his electorate accordingly. The incident shows once more how unskilled Macron is in dealing with ordinary people. He was good at winning, but now comes across as patronising. Empathy is clearly not his thing

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October 05, 2018

Moscovici all but breaks with his socialist party

Pierre Moscovici is telling the world that he won’t be available to stand as his party’s lead candidate in the European elections after all. And the manner of his announcement shows the extent of his anger. A tweet, a public letter, a long and devastating interview in Le Monde: the EU’s commissioner for economic and financial affairs looks to have all but broken with a French socialist party which, he says, is irresponsibly oblivious to the challenge of right-wing populism.

This is because, despite the dangerous rise of the hard right, they remain stuck in a kind of European no-man’s land and refuse to choose between seeing the EU as an asset or as a constraint, even as a punishment. Moscovici also made clear he would not vote for his party in next year’s European elections, and pointedly left the door open for recruitment as a candidate on Emmanuel Macron’s future electoral list.

Does any of this matter? The answer is yes and no. Moscovici is still enough of a heavyweight for the PS to have signalled that the party’s top electoral slot next year would be his for the asking, provided that he espoused the party’s manifesto. As it turns out, this will be highly critical of the Juncker commission and therefore of Moscovici himself. It is no secret, writes Libération, that the party leadership sees their former finance minister's decision to withdraw with relief — they are looking for a candidate more obviously attractive to left-wing voters.

But, be that as it may, the battered party - currently credited with a miserable five or six percent of next year’s vote - will now have to cope with further damage from Moscovici’s brutal attacks. The commissioner’s onslaught will also add to the woes of the EU’s socialists and social democrats, who can ill-afford further troubles at a time when they look set to lose their traditional position as the European Parliament’s second political force. Ah, yes, before we forget: Moscovici also said that he would not make himself available as the European socialists’ spitzenkandidat either.

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