June 23, 2017
The offer, and what it says about the state of Brexit
We are becoming increasingly convinced that the single biggest risk to the Brexit negotiations is the creation of false expectations. We think that Donald Tusk is seriously ill-advised to continue speculating about a return of the UK back to the EU, even in the rather quaint way he did it yesterday. The British took his John-Lennon antics with a sense of humour, but what if the EU concluded at one point that there is a real chance that the UK might reconsider Brexit? Would the EU at that point not harden its own negotiating position in order to make a Brexit reversal more attractive? Could they refuse the offer of a transitional period for the same reason?
Our concern is not so much that the UK reverses its decision, but that a miscalculation on the part of the EU could prompt the hardest imaginable Brexit.
Theresa May should have spent her 15 minutes at the Council explaining that she will see through the process personally; that she won a greater share of the vote than almost any leader present; that the opposition supports her Brexit mandate; and that a change of government, though unexpected, would not make a difference.
Her offer on the rights of the 3m EU citizens in the UK - us included - is not really surprising or meaningful because immigration is an issue where the small print matters more than the grand headlines. What we thought was more interesting than the offer itself was how some EU leaders reacted to it. While Angela Merkel was cautious as ever, the FT quoted others as being more open, especially on the vexed question of the role of the European Court of Justice, a demand some are already backing away from. May effectively gave up on March 2017 as the cut-off date, in favour of a date from between March 2017 and March 2019. In the end, what will matter in this particular subset of negotiations are the thorny details, like: the treatment of family members not residing in the UK, the very common occurance of incomplete paperwork or a short interruption of an applicant’s employment record, or the absurd 85-page application form which really requires the help of an experienced lawyer to fill out satisfactorily. These things matter more than the headlines.
But the bottom line of what Theresa May is proposing is that everyone who arrived in the UK before March 2017 will be able to stay, those who arrive between now and Brexit day will have a chance to regularise their status, but may have to apply for permanent residence under a new regime. We predicted that this would happen. The EU’s red line in the negotiations is the protection of the rights of people who are residing in the UK now. The UK’s red line is sovereign jurisdiction. This is not really a hard issue to compromise on. A roomful of immigration lawyers could do this in a weekend. We assume that the UK will accept the EU demands on the important small print issues, while the EU gives up the demand of oversight by the ECJ.
If the biggest risk to the Brexit process is false expectations for a Brexit reversal, then the best way to achieve this outcome is to give misleading advice to Brexit negotiations and the politicians who are behind them. The debate is clouded by bitter British EU officials, who are understandably frustrated that years of their work in Brussels have come to nothing. These diplomats tend to offer poor advice not out of spite, but because they cannot see the difference between negotiating within the EU, which is their field of experience, and negotiating with the EU. This was our thought when we read Steve Bullock in the New Statesman, who gave a very accurate rendition of the negotiating methods employed by EU diplomats, where the key to success is trust. But it did not work for Greece. Nor is it likely to work for the UK in the Brexit negotiations, because the Brexit negotiations are between one country and a group of 27 represented by a joint negotiator with an inflexible mandate. One does not need to apply game theory to understand that a credible no-deal option constitutes an essential tool to balance the playing field, which in turn constitutes a pre-requisite for an agreement.
Peter Kellner is right in his UK political analysis: May is stable for now. A leadership challenge would make no sense whatsoever because the Tories would risk another election which they might lose. It is worth also reading David Owen on the Labour minority government in the 1970s. Such constructions are difficult, but can be surprisingly robust.