June 13, 2019
On the large and rising risk of a no-deal Brexit
Whenever you hear a journalist, commentator or politician say the UK parliament will block a no-deal Brexit, stop reading or listening immediately. By triggering Article 50, the UK parliament already legislated for a no-deal Brexit as the default option. All the rest is noise.
Yesterday's vote against the Corbyn-Letwin initiative to seize power of the legislative agenda for a singe won't change it. The only - positive - effect it could stop a few more people from deluding themselves. But it does not change reality. The idea behind Corbyn-Letwin was to agree on a strategy to prevent a no-deal Brexit, for example by making it illegal for the government to prorogue, or suspend, the House of Commons.
Article 50 makes it clear that there is only a single strategy available to the British parliament to avoid a no-deal Brexit - to revoke Brexit altogether. But, even if yesterday's motion had been agreed by a small majority, there would still have been no majority for revocation. The EU would probably give the UK time for a second referendum. We think that would be a mistake, but this is a moot point since there is no Commons majority for a second referendum either.
We have been saying for the last few months that the markets are underestimating the probability of a no-deal Brexit. We noted that Sir Ivan Rodgers was saying exactly the same. The Times quotes him as saying that the commentariat had misread the chances of a no-deal Brexit. The reason he gives is that EU governments are not willing to play the extension game any longer. Another reason, more important we think, is that extension is proving extremely toxic for UK politics.
Boris Johnson is right, of course, when he says the Tories will become politically extinct if they don't deliver Brexit in October. We think there is still a chance for the House of Commons to pass a deal, but this critically requires that the final choice is deal versus no deal. It was Theresa May's political and intellectual failure to have ruled out a no-deal Brexit and to frame the choice as deal vs. no Brexit. This is why she could never deliver her own treaty. The majority in the Commons is pro-Remain. No Brexit is not a threat to them. And Tory hardliners did not think her threat was credible. It is true both sides cannot be right simultaneously. But the delusion of one of them was enough to sink the deal.
We don't think yesterday's vote made a lot of actual difference simply because the legal reality under Art. 50 remains unchanged. Dominic Grieve, probably the most prominent and intelligent anti-Brexit campaigner in the Tory party, was right yesterday to acknowledge this reality last night. We think he is wrong when he says that the only way to stop a no-deal Brexit is a vote of no confidence.
First of all, we are not sure that a vote of no confidence would necessarily produce a majority. Many MPs, especially Independents and Tory rebels including Grieve himself, would end their political careers as they would be certain to lose their seats in the subsequent general election.
Secondly, even a successful vote on a no-confidence motion may fail to do the trick. A prime minister hellbent on delivering Brexit before the election is under no legal obligation to ask the EU for an extension. There is an argument that it would be the better option for a Tory prime minister, under pressure from the Brexit Party, to allow a no-deal Brexit to happen in the middle of an election campaign. Unless the House of Commons secures a vote of no confidence in late July, we see no realistic chance of elections being held before the October deadline. If MPs were to trigger this after mid-September, parliament would be dissolved before the October deadline, but reconstituted afterwards. The assumption that a no-confidence motion would stop a no-deal Brexit thus critically relies on the co-operation of a prime minister. If the prime minister does not co-operate, a vote of no-confidence might actually trigger a no-deal Brexit.
We would not rule out that political circumstances might lead a prime minister to ask the EU for a short delay. The EU would grant it. But our overall point is that the House of Commons is not the main actor in this process.