There seems to be little to report on Brexit, which is not at all good given how little negotiating runway remains. The Independent and the Financial Times said that Michel Barnier wouldn’t come to London for the Friday session unless the UK showed some movement in its positions. Per the pink paper:
An EU official said Mr Barnier had told his UK counterpart David Frost this week that there was little point in the EU side making the trip to the UK capital if there was no sign of movement in the talks.
Tony Connelly of RTE reported that Barnier had a video conference set for Friday with the eight fishing countries, which at a minimum means even if he went to London, he’d need to break for this confab.
Nevertheless, the EU has always made a point of being willing to talk, so having Barnier remain in Brussels but dispatching the rest of his team would send a message…..as if one needed to be sent. The EU has been broadcasting the same message from the very morning after the Brexit vote, that if the UK wanted access to the Single Market, it would have to subscribe to the Four Freedoms, which the UK rejected. The UK has repeatedly demonstrated appalling ignorance of trade deals, such as saying it wanted a Canada-style deal and acting as if it was tariff-free and contained no “level playing field” provisions. In fact, it contains both. Similarly, the agreement the UK just sealed with Japan contains provisions restricting state aid…yet the UK has taking the position that those are a no go in an EU deal.
Oh, and while we are on the topic of that Japan deal:
Yesterday in the House, I confronted Liz Truss with her own Department’s report on the question she’s repeatedly refused to answer: what’s the difference, in pounds and pence, between her Japan deal and the EU-Japan deal it replaces? She didn’t look happy. pic.twitter.com/PKuiYYlNnI
— Emily Thornberry (@EmilyThornberry) November 26, 2020
The Financial Times reported that the UK offered a four-year review clause. It’s hard to see what this would accomplish, since the only adequate remedy would be to force what amounted to a crash-out, which would be more disruptive to the EU then than now, when it is already preparing for Brexit changes:
This week there was a flutter over whether a four-year “review clause” might provide a mechanism by which the two sides could create the space for a deal, but the differing interpretations of how that might work speak to the divide between the two sides.
What started with a conversation about kicking the can on the fishing issue (which the EU has always said must be traded against access to the EU’s single market) opened the door to some thinking on a possible fix for the overall deal.
Under some UK thinking, a four-year review clause on the free trade agreement would enable Brussels to assess if the UK had behaved in a way that undermined non-binding promises on free and fair competition — with Brussels imposing tariffs on UK trade in retaliation if necessary.
Such a proposal was never going to fly for the EU. The imposition of tariffs after the fact is far too small a price to pay for competitive divergence — particularly if the UK should retain all the other market-access elements of the proposed FTA, from aviation freedoms to border trade facilitations.
More realistic, from an EU perspective, might be to agree a review clause where the penalty for the UK walking away from its level playing field obligations was a much more “nuclear” option, with both sides reverting to a full no-deal scenario if the deal wasn’t working.
Financial Times readers weren’t impressed either:
Fooltomyself
What’s the plan? Is it possible Johnson/Frost don’t actually have a clear outcome they are working towards, and are waiting for public opinion to nudge them to ‘agree to something’? (cf the first lockdown, which was implemented by the public and confirmed by a reluctant Johnson.)
In what way is the UK offering to have a different partnership with the EU, than other neighbours eg Serbia, Turkey, Russia, Morrocco? Is one of them our future model?
Scarlet Pimpernel
This thing is dead. No way Boris can concede. And why should the EU. BJ’s vision is that of a (hopefully more properous) Cuba sitting close to but independent from Europe and causing havoc. Good luck with that. Who would trade with people like that. A new PM will settle. But this one needs to go first. No deal is the way to get him booted out.
The press has more and more accounts of Santa delivering coal to the UK’s stocking. The Express is warning that Northern Ireland shoppers won’t be able to get 15% of Marks & Spenser’s food items come the new year.
And remember…back in Theresa May’s tenure, one of her ministers tried suggesting that food stores could stockpile, only to have industry incumbents clear their throats and say, no, they operated on a just-in-time delivery basis and could inventory only a few days of supplies? Broader food worries are back, with Covid another stresser. From Bloomberg:
A scarcity of warehouse space because of Christmas demand and the pandemic is putting the U.K. at risk of shortages of some food products as it prepares to leave the European Union’s single market.
With five weeks to go before the end of the Brexit transition period, large manufacturers and industry groups are warning that the capacity of the food supply chain is at its peak and can’t withstand any further shocks.
Unilever, the maker of Ben & Jerry’s ice cream and Hellmann’s Mayonnaise, said it is building up stock of key lines but “warehouses are absolutely full.” Like rival Nestle, the maker of Kit Kats and Nescafe coffee, maintaining supply of finished products and ingredients is now the priority as talks between Britain and the EU on a trade deal remain deadlocked. Yet that’s “with stock building more difficult at this busy time of year,” Nestle said….
There have been numerous warnings about potential Brexit disruption from companies and even U.K. ministers, such as lines of trucks on the highway regardless of whether there’s a trade deal or not. The trouble is that the latest contingency planning couldn’t come at a worse time as Christmas goods take up storage space.
Mind you, the notion that a year-end departure was the worst possible time isn’t news. Nor is the idea that the UK has a highly optimized retail food system, which makes it vulnerable to breakdown. From Ian Dunt in 2018:
We’ve grown so used to frictionless EU trade that our food system is based on something called Just In Time. The idea behind this is that products are constantly cycling from producers to consumers, without being stored in big cargo holds. It’s more efficient and also more pleasant. This is why you eat fresh tomatoes from countries miles away without ever really having to think about how extraordinary it is. Under your feet, a miraculous logistical engine is constantly pumping ham and cheese and fruit and veg and bread around the continent. It’s a circulatory system of yummy wonderfulness.
2/ @IanDunt on the ‘modern day miracle’ of Just-in-Time (JiT) inventory systems that we all secretly take for granted, when we visit the supermarket. #skypaperspic.twitter.com/t4feiNn6BP
— Martin Cooper (@mpc_1968) July 26, 2018
The UK is particularly reliant on Just in Time because it doesn’t feed itself. Domestic food production has been steadily declining from the early 1980s and is now at just 60%. Most of our imports come from the EU because it is closest to us. With food more than arguably any other good, distance is important – because it’ll go off. About 10,000 containers of food come into the UK from the EU daily. (This is an excellent recent report on Britain’s food security and its vulnerabilities.)
But the efficiency makes it fragile. The impact of no-deal Brexit on this system would be an implosion in the trade network. Suddenly, the full certification system would need to be checked at the border. Frictionless trade would be replaced by standard-issue bureaucracy.
Sky describes the UK’s efforts to brief haulers….when the app won’t be released till December 23:
After four years of politics and prevarication, Brexit is about to become a test of competence rather than conviction.
And the heart of the government’s effort to meet it is a cabin in a lorry park in Ashford, Kent.
It’s one of 45 sites around the country where agents patiently attempt to brief hauliers on impending changes to border arrangements that have applied for a generation….
n total, this new pile of red tape will run to 270 million customs declarations a year, and, in practice, responsibility will fall to hauliers and drivers, 3.5 million of whom cross the short Channel straits into Kent, largely through Dover, every year.
At Ashford, on a grey Thursday with 35 days to go, four agents tried to stop drivers as they made their way for a shower or a meal.
Most stopped to hear them out but very few speak English. The vast majority of drivers are from eastern Europe and often more interested in a hot drink than an iPad demonstration.
Using Google Translate, the agents did their best to walk the drivers through the new system.
But there is another problem. The app they’re demonstrating is not available yet.
Despite having years to prepare, the government will only release it on or around 23 December, just eight days before it needs to work.
Without it, or if the paperwork it tracks and coordinates is not completed correctly, lorries will not be able to board boats or trains.
Reuters chronicled how delivery prices are already up as companies are frantically moving goods before the January 1 state change:
Logistics companies told Reuters they have seen a surge in demand to bring goods into the country before any potential disruption in January, and customs agents report being overwhelmed by pleas for help from traders grappling with the rules for the first time.
“We have told our customers that the best thing you can do now is stock up, stockpile, and they’re bringing in as much as they can,” Jon Swallow, director of Jordon Freight, told Reuters…
Swallow said the demand had pushed prices up by around 20% in recent weeks and further rises were likely in December.
Fellow freight specialist Tony Shally said his Espace Europe had seen the cost of journeys between Poland and England, and Northern France and England, rise by more than 10%….
Sam Harris, operations manager at provider Freight UK, said it had become a full-time job just to answer the phone to new customers. “Most know nothing about customs,” he said. “Everyone is panicking.”
“We had a farmer on the phone and he had no idea whatsoever about what needed to be done.”
The Reuters account also described how Covid had made matters worse: companies had put off stockpiling, unlike before other Brexit deadlines, because they were low on cash. Financial stresses also meant many have held off on hiring and training new customs staff.
Twitter confirms the Reuters tidbits:
150miles driving through freezing fog…. now at the #eurotunnel #freight and it is rammed.. I think all of the EU is trying to get there goods over before #brexit ? pic.twitter.com/STwdUvBY5k
— Cycling Trucker (@CyclingDriver) November 27, 2020
Another new route…. from Friday’s Irish Times. pic.twitter.com/eNDpn8UJsm
— winding_sios ??+?? (@winding_sios) November 27, 2020
Boris Johnson is the only one who can change his negotiators’ mandate. But he is allegedly indecisive. Even though Johnson no longer has Cummings to push him around, the inertial path is a crashout. Carrie Symonds may have won the battle against the Brexit Boys, but her intervention looks to have come far too late to change the course of the war.
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No U.K. minister would ever warn about, “lines of trucks on the highway”. Lines of lorries on the motorway, perhaps :-)
True enough!
But then again, motorways in the UK are run by Highways England. I’ve always wondered why every English speaking country seems determined to have its own word for its roads and streets.
It is Highways England [1] but only in distinction to Byways England, its hypothetical complement which would look after all of those public rights of way that exclude vehicular traffic. A highway is an English legal concept rather than a road type. Although most highways are the responsibility of local authorities and Highways England only looks after trunk roads, which is a different kettle of etymological fish entirely.
But definitely lorries. Albeit in queues, not lines (except in the physical sense).
[1] for the moment – National Highways here we come! https://www.theguardian.com/politics/2020/oct/20/highways-england-rebrand-accused-of-being-an-offensive-waste-of-7m)
America used to call them freeways. We didn’t like the class connotations of the ‘highway’
“Freeway” is a west coast US usage, meant to distinguish from the toll roads on the east coast. Here in NYS, we have highways, expressways, parkways (thanks to Robert Moses’s use of park-related legal powers to build them) and the Thruway
Highways simply used to be raised up higher than the surrounding land for better drainage.
In America you drive on a parkway but park in a driveway. See New Jersey.
Very Steven Wright!
And to us Brits, all on the wrong side of the road!
For the past two weeks reputable sources have been talking about Johnson signing up to the deal within a matter of hours. And yet, total silence. This mornings twitter reports that Barnier is quite testy, so we are going into December with major issues not decided. Even if a deal was signed next week, its too late to avoid some level of chaos in January. Actually, before January, as I think panic buying (both from consumers and businesses) will be inevitable in December.
The only real explanation I can think of for the inaction from London is that not just Johnson, but his whole team somehow thought that pushing things to the limit would cause Brussels to blink, allowing them political space to sign something that could be sold to the public as a victory. But they are now stuck in the classic pose of the bluffer who’s bluff has just been called. Maybe thats why Cummings was so happy to exit quickly, he wants to have clean hands.
This is where the the entire ‘they’ll sign something at the last minute’ consensus will come back to haunt many businesses. I strongly suspect that most businesses simply have no idea what they will do, they are just hoping that something will turn up and save them. We are fast running out of time even for the sort of can kicking fudge the EU is famed for.
>not just Johnson, but his whole team somehow thought that pushing things to the limit would cause Brussels to blink
Yeah probably.
But may I also offer the theory that this Eaton boy and his cronies don’t ever expect to actually do anything, as some “bright chap” in some mysterious department is expected to be taking care of it.
That is, he didn’t “think” anything. He simply went on like he’s gone on his whole life and never really grasped that yes, the buck now stops at his desk.
I belive this is the ministry that Mr. Johnstone was expecting to resolve the Brexit conundrum. https://www.dailymotion.com/video/x2hwqki
Unfortunately, staffing in the ministry is down substantially after engaging in some competitions over the past couple of years, so they are quite short-handed. https://www.dailymotion.com/video/x2hwqln
My own belief is that the British elite’s approach to Brexit reflects its ossified, class bound society: it was natural for people who had highly privileged upbringings in which everything was handed to them and no whim denied to assume that the Brexit deal they wanted was there for the demanding.
I like this explanation. Neatly encapsulated as “We shit from a greater height so why not Brexit!”
This could not have come at a worse time. With a no-deal Brexit coming just around the corner, now would be a good time to stock up on personal supplies in case of unexpected shortages. It may be a case of you will have to wait until next January to see what shortages of what items come up. But with the present pandemic, people are being locked down in their own homes and are unable to get out and about to make much needed preparations. Could not have predicted this development back in 2016.
I haven’t managed to confirm it, but I have heard that the stockpile of medicines the UK government was building up for Brexit has been completely depleted due to Covid (bizarrely, the stockpile was in Belgium, apparently the only place with the right kind of storage facilities). While warehouses are full, and no doubt many companies have been building up internal stocks of crucial materials, this can only get you so far, and you’d wonder what other products will suddenly vanish in late December.
On this point, I’ve noticed on my cycle home from my office that construction sites in Dublin are in full tilt (even new hotels!) – most are only permitted to work between 7am to 6pm, but many are starting earlier and I passed two that were still going strong at 7pm last evening. This is potentially costly to contractors as they have to pay overtime and deal with enforcement issues. There may be a range of reasons, but I suspect that the industry is preparing to shut down in January and maybe longer (lots of construction materials here are sourced from the UK) so they don’t get caught up in the chaos. Traditionally, here the construction industry takes at least 2 weeks off over the break, its probably sensible for them to extend that by a few weeks.
probably because it would fit into a small storage room at the local self storage place
Well, the rubber will meet the road, and as has been said, at not a very good time (that is, unless they manage to hide all the chaos in “it’s COVID, not Brexit!”).
Populists meeting with reality usually doesn’t end well, as the populist we have seen so far are good at telling people what they want to hear, but not so good at actually delivering any of that (and here, we could probably write a PhD disertation on why that’s so).
I won’t say I’ll go and break out the popcorn, as I still have some ties, emotional and economical, to the UK, but am not far TBH. *)
*) I’m in a sort of win-win. Sort of. If Brexit is not a disaster, my UK ties will benefit. If it is, at least I can say “I’ve been saying that for years” (not that most Brexiters will listen). Or maybe I’m just looking for silver linings.
I’m with you on the ‘two minds’ thing over Brexit.
The gloomster in me quite looks forward to the havoc and seeing that horrible crew having to clear up their own mess (and of course, I want to be proven right in my predictions, for once at least), but on both a personal level and a rational level I really hope they fix something – the human consequences are far too serious.
I believe you confused “populism” with “demagoguery”…
See the review of Thomas Frank’s book on populism here at NC.
BoJo, Trump, Bolsonaro, Orban, et. al., are the antithesis of populism. Their wreckage is portrayed by MSM as populism. This goes way, way back, doesn’t it?
I don’t think so, I believe it falls into the same category as liberal vs liberalism vs liberarian etc.
Frank (nor me) defines what a word means, society does, and, for better or worse, the society is now formed by media. Which call those people “populist”.
So Frank better find a different term, because being unhappy about it being devalued is not going to do much (I’m very unhappy about “liberal” being devalued by the US, but can’t do much about it except bitch about it now and then. I do, but I know it’s not going to change the perceptions of millions of Americans).
“Society defines what a word means.” How does society define ‘society, vlade?
As it wants. For example, by excluding all blacks in the South cca 1860 (and at other times too).
Or splitting into “elites” and “deplorables”.
Populeftist?
Populiberal?
Populiberadical?
BBG says Barnier will fly to London later today. But he doesn’t sound very optimistic.
Connolly is implying that while there will be weekend talks with Barnier, there hasn’t been any significant movement. The UK seem to be trying to break the deadlock with a review clause of some form, but the EU isn’t having it, at least not without serious penalties for any breaches.
Even Boris must now know that a decision to sign any later than this weekend is just not viable. Or if not him, Carrie, or whoever is making the decisions in No.10.
his former brain?
I note, purely for what it says about the “conventional wisdom”, that the political betting markets have the odds of an EU-UK trade deal by the end of the year at an all time high.
https://smarkets.com/event/40554343/politics/uk/brexit/trade-deals/?market=9435468
One can obtain 4.4/1 odds that no such trade deal will be agreed in the next month. I’m tempted to have a flutter (bearing in mind that the last-minute face-saving fudge is probably still a likely outcome.)
As many, many commentators have pointed out, though, it’s not some dichotomy between “a deal which makes everything fine” and “no deal which is an unmitigated disaster.” Whatever we get now seems certain to bring with it some level of initial chaos and medium-term decline.
That is interesting, although I wonder what the bookies consider a ‘deal’. I suspect that they are assuming that even in the event of a no-deal, there will be some sort ‘deal’, to prevent absolute January chaos, meaning they won’t have to pay out.
But it does seem to indicate a core problem, in that the widespread assumption that ‘something’ would be cooked up to prevent the Wiley E. Cayote moment occurring is itself very damaging as not nearly enough preparations have been made. As so often, Yves has so far been proven right in noting that business has severely underestimated the chance of a no-deal.
PK, the cartoon character is Wile E. Coyote. This is one of my favorite cartoon characters – I even have a t-shirt. Nothing he does ever works, yet he ‘keeps on keeping on’. Sorry to be such a stickler.
I think we’d have a favourite cartoon character vote. Calvin gets my vote… I have the full collection :)
Great, vlade. So do I. I, too, love Calvin and Hobbes.
As my other favourite cartoon character would say: ‘D’uh!’
For my part I’ve no doubt that BoJo and his merry men are fans of the UK TV series, “It’ll be alright on the night” which began in 1977 and is still going, except that they think it’s a documentary.*
(*Actually it’s a compilation of out-takes, cock-ups and bloomers, which of course is an accurate reflection of life within HM’s current Government.)
The specific terms are, as you suggest, very generous on the interpretation of what a “Deal” is.
“If the UK and EU sign a trade deal between the 16th January 2020 and the 31st December 2020 this market will be settled as yes. If the trade deal is agreed in this period but comes into force at a later date, this market will be settled for yes.
This market covers any trade deal, either sector by sector or a complete deal.
If no trade deal is signed in this period between the EU and UK this market will be settled for no.”
So some fudge on aviation would count just as well.
Betting markets are stupid (except for some very specific cases).
You could have got massive odds on Trump winning on the election night, because most punters didn’t understand/know about mail voting (Yes, even after it was a hot topic for anyone actually paying attention to the US elections for months).
I got very good ods on Brexit not happening four years back, day before Brexit.
One thing to understand about betting markets is that the house loses only in some circumstances, but what it also means is that the betting ods are risk-neutral (well, the are not, because the house expects to make money but still). I.e. if someone heavily bets one way, they will skew the _betting_ odds – but it will not skew the _real_ probability of the event itself, that stays the same.
I know, because I cleaned up on election night just by following the vague mathematics of people who knew how many mail-in ballots were outstanding in the various swing states :)
You are right of course that they are dumb but in terms of the perception (skewed as it is by the kind of people who are likely to bet large sums of money on betting markets) I find it interesting that the “odds” of a deal have only been rising throughout this year. Surely motivated more by a faith that something will be drawn up at the last minute in the midst of this crisis rather than any actual progress at the talks…
I suspect that English authorities, Tories in particular, have long been contemptuous of agriculture and agricultural planning. After all, how many of them would deign to work the fields for a few years before reaching adulthood? That kind of work is for little people.
I say this to point out a lesson that all Americans will have to heed: such indifference to agriculture and agricultural policy, as we have now under the rubric of a “free market” (i.e. turning a blind eye to anti-trust enforcement, concentration, and consolidation) in the U.S., can eventually take the U.S. down a similar path. And it didn’t have to be that way; under FDR and Truman, agricultural policy was far more supportive of [smaller] farmers and rural life was much more robust. Getting rid of parity sounded the death knell for U.S. agriculture, and it’s been mostly misery ever since.
well its hard for Congress to see that when they are the ‘small’ farmers….oh wait….maybe not
Happy Post-Tryptophan-Stupor Day to the US based commentariat!! ;-)
And thanks for this article. I have not been paying much attention to BrExit and this is a wonderful catch up! I am reminded of that article written by a South Asian journalist in the last year of so which excoriated Britain’s political class a bunch of prep-school fail-sons. If only they could do just themselves harm …
What. A . ClusterFamilyBlog.
On a lighter note, I did come across the most bizarre advertising campaign for How To Handle Brexit out of Holland. Brexit is personified (or rather, fursonified) as a hairy, hogtied blue creature (via Twitter). I was a bit aghast at first, but as a Brit might say: it’s spot-on innit?
I’m trying to picture the rest of “the West” letting the UK starve over the EU deal and what that would mean for the EU…
Johnson and co are inheritors of a system of thinking that says that ultimately governments don’t matter. Since the 80s, the accepted wisdom has been that governments should disengage from the economy, leave everything to the market etc.etc. But nobody noticed that the converse was also true: in the end it didn’t matter what governments did, because the good old private sector would always find a solution. In a very real sense, therefore, for Johnson and co this was all theatre. Blaming the EU, scoring points over the opposition, “winning the day” in the media, were the important things, because they were the only things government was actually supposed to do. Even now, I think, there is a belief that it will all come out right because practical businessmen will roll up their sleeves and make it so. The motto of this government is “no, I’m not really a national leader, I just play one on TV.” Wasn’t there a mock superhero film a few years ago about the cast of a Science Fiction etc who were taken seriously by aliens in need of help. Well, that’s pretty much where the UK government is now.
Galaxy Quest.
Wasn’t there a mock superhero film a few years ago about the cast of a Science Fiction etc who were taken seriously by aliens in need of help.
As Tom Bradford noted, its called “Galaxy Quest”, and loving tribute would be a better phrase than “mock superhero film”.
You should really see this movie. By Grathbar’s Hammer, what a movie!
Seconded, a good movie, with a good cast.
Ribbing common scifi tropes and franchises while being a fun romp – you could do far worse than spend your time with it!
(if you want some nice, non-comical scifi I can recommend The Expanse)
Regarding Brexit, if they are going to try and roll out a new app that late, I shudder ar what state the backend systems will be in. If you can, take the start of the year off from doing any transportation involving the UK. Sadly, that’s not an option for most people who are in that business.
Well, Johnson’s handlers are pro-Asiatic globalists. What do you think would happen???? Farage should just move to Asia and tell the truth. White people are going to learn some hard truths in the next 10 years about Capitalism’s future and debt expansion. Its why another Donald Trump isn’t coming anytime soon, instead I see the opposite. Race baiting socialists return……..with 1970’s Bernie Sanders returning to lead the charge.
i always wondered why there was so much sound and fury about these ‘talks’…that were doomed to failure since it does 2 parties to make an agreement. and one of them doesnt want to. so why the other ones even showed. i dont know,,,,unless it was to be able to say….hey they didnt want to agree to any thing, so dont blame me for the mess
Remember guys, when China depegs and Asia pegs to them, the UK will find a home. Always follow the money. The so called “far right” and UKIP are actually anti-European globalists……….all along. Dialectics need to get back on track. Yes sir, Leftists can be racists, matter of fact originally, they wrote the book on race baiting to get power.
Don’t let the media win. Start calling them out and reject their lies.