Brexit: will it all be a
fuss about nothing?
‘IAIN DUNCAN SMITH:
Cabinet’s Brexit proposal is a betrayal of 17.5 million voters who
wanted to take back control of their own laws, borders, money and
regulations’, was the heading of his article in the Mail
Online on 8 July.
That’s only his opinion. Actually, 17,410,742 voted ‘Leave’ to
the question on the ballot paper ‘Should
the United Kingdom remain a member of the European Union or leave the
European Union?’
while 16,141,241 vote ‘Remain’. Strictly speaking, then, what
there was a majority for, was for the UK to withdraw from the Treaty
under which it joined the EU and so from the EU’s decision-making
institutions (Commission, Parliament, Court of Justice, etc).
Iain Duncan Smith may have
voted Leave because he wanted the British capitalist state to take
back formal control of UK ‘laws, borders, money and regulations’.
Many others may well have done so too, but others will have voted to
withdraw merely from the political side of the EU project. As the
Tory MEP, and prominent Leave campaigner, Daniel Hannan noted, one
argument used to attract Leave voters was that things had changed
since they had voted in the 1975 referendum to confirm staying in: ‘I
voted to stay in the common market. No one ever mentioned a political
union’ (Spectator,
28 April). It will only have taken 634,751 (half the difference
between the Leave and Remain votes plus 1) to have been convinced to
vote Leave on this ground and Iain Duncan Smith’s claim that a
majority voted for what he wants falls.
Hannan himself is pretty
relaxed about just withdrawing from the EU’s political institutions
as long as the UK has some scope to do its own trade deals, writing
on a Tory discussion forum:
‘A 52-48 outcome pointed to
some sort of association that stopped short of membership. Britain
would keep most of the economic aspects of the EU while losing most
of the political ones ... We’d end up very broadly, in an EFTA-type
arrangement à la
Suisse’
(Conservativehome,
10 May).
We can leave these two
high-profile Leavers to slug it out. The Tory party can split over
the issue for all we need to care.
People will have voted Leave
for all sorts of reasons – to kick out the Poles, to do down the
government, because they believed the promises that they’d be
better off, to protest against their personal economic plight. Who
knows? In the end it doesn’t matter why, since the outcome will
depend on jostling between different sections of the capitalist
class.
Most of them were in favour of
Remain. A minority, mainly financiers who didn’t want their
dealings to be regulated by the EU (and who largely financed the
Leave campaign), favoured Leave. Perhaps unexpectedly, they won. Ever
since, the majority section, and the politicians who represent them,
have campaigned and lobbied to limit the damage to their interests.
The plan agreed at Chequers on 6 July goes a long way to catering for
their interests. It is more or less what Hannan envisaged as a
compromise between the two sections of the capitalist class, even if
Jacob Rees-Mogg, the cartoon toff – Lord Snooty in the Beano
– doesn’t like it. But then, he’s a financier with interests in
Hong Kong.
A customised union
A ‘customs union’ is an
arrangement between capitalist states under which there is
tariff-free trade between them. A ‘single market’ takes this a
step further by also removing non-tariff barriers to free trade such
as differing technical, safety and environmental standards. This
means that trade within the area can be ‘frictionless’ as there
is no need for border checks to see if the goods conform to these
standards since they are the same in all the participating states.
Another way of defining a ‘single market’ would be that it is a
customs union with a ‘common rulebook’.
At Chequers the government
agreed that the UK should in effect stay in the EU single market for
goods (if not services). It is what the manufacturing section of the
capitalist class, as represented by the CBI, wanted, even if it won’t
be as good for them as now since they won’t have a say, via the
government, in drawing up future additions or amendments to the
common rulebook.
Trump had a point when he
blurted out that this could sink a US-UK trade deal in goods. There
would be no point. As he said, the US would deal with the EU as what
was agreed with them would apply to the UK as part of the single
market:
‘If they do a deal like
that, we would be dealing with the European Union instead of dealing
with the UK, so it will probably kill the deal’ (Sun,
13 July).
He’s not all that badly
briefed. The government replied that he hadn’t read the small
print, and it is true that the Chequers proposal does come up with a
novel way for the UK to be able to do trade deals with non-EU
countries, if any are interested. Normally, a customs union (which is
what a single market implies) involves a common external tariff
against imports into the area. The government is proposing that this
should only apply to goods intended for parts of the single market
other than the UK. So, as now, the UK would collect the common tariff
on these goods entering the UK (and pass the money on to the EU), but
not on goods from outside the EU intended for the UK market only.
In theory this might work, but
it wouldn’t make a trade deal only with the UK that attractive
since the EU market is much larger. Conceivably the US might agree to
a deal that would allow chlorinated chickens and GM foods to be
imported into the UK but there would have to be some way of
preventing these getting into the rest of the single market by, for
instance, being smuggled across the Irish land border.
It might work if the EU agrees
to go along with it. The EU might if they can get guarantees against
smuggling but they can be expected to insist on the Court of Justice
having a decisive say in any disputes. And there will have to be a
deal rowing back on the free movement of people (incidentally, one of
the few benefits of the EU for ordinary people) towards the free
movement for employment that was part of the original Treaty.
Services (which are mainly
financial) are to be excluded from the common rulebook. This should
please those financiers who funded the Leave campaign – they won’t
be subjected to EU regulation. On the other hand, less shady
financiers won’t be happy as they will be excluded from some
trading with the EU. To get round this they will have to move a part
of their business from London to Frankfurt or Paris or Dublin but no
doubt they will be able to live with this. And maybe they will
bargain US access to providing services to the NHS for more access to
Wall Street.
One thing that won’t happen
is the UK crashing out of the EU with no deal. That would provoke an
instant economic crisis that would have global consequences, as well
as likely to re-ignite the Irish Republican armed struggle in North
Ireland. It’s in nobody’s interest. Even those who feign to
believe that ‘no deal is better than a bad deal’ don’t really
believe this. It’s only bluster to try to strengthen the UK’s
negotiating hand.
So, in the end, it looks as if
it’s all going to turn out to be a fuss about nothing. Britain will
stay in the single market and business will continue as usual. Maybe
many of those who voted Leave will feel betrayed but they would also
come to feel betrayed, if the hard Brexiteers had their way, when
these cynical ambitious politicians failed to deliver on their
promises of a better life. They wouldn’t be able to deliver
because, no more than a change of government, can a change of trading
arrangements make capitalism work in the interest of wage and salary
workers and their dependants.
ADAM BUICK
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