Britain is, and was, deluded about its negotiating power with the EU

http://blogs.lse.ac.uk/brexit/2017/11/09/swallow-the-lot-and-swallow-it-now-britain-is-and-was-deluded-about-its-negotiating-power-with-the-eu/

by merraksh • 9 years ago

65 102 9 years ago

blogs.lse.ac.uk

osullivj2• 9 years ago

Well argued POV. However, the article overlooks the role of the Profumo Affair in ending the MacMillan govt. Another relevant precedent is the EZ negotiations with the Greek Govt over the sovereign debt crisis.

ZenoArrow6• 9 years ago

"Another relevant precedent is the EZ negotiations with the Greek Govt over the sovereign debt crisis."

How is that relevant here? The Greek government wanted to declare bankrupcy, but after some initial resistance their own ministers bottled it. They had the power to walk away if they wished.

osullivj2• 9 years ago

The Greek Govt wanted to negotiate a restructuring of the debt. That outcome would have yielded economic growth, and real servicing of the restructured debt. But that rational and realistic outcome was ruled out by the political requirement for EZ unity, the need to make good FR & DE banks holding GGBs, and the will to impose Schauble & Djisselbloen's economic views. The parallel is the misguided hope of the weaker negotiating partner hoped that pragmatic realism would prevail over the stronger partners politico-economic agenda.

marze• 9 years ago

Why can’t the U.K. just leave? Say we are gone, we are not giving you any money, and unilaterally state a position on trade terms?

I realize this may sound naive, but I’m just curious.

selectodude• 9 years ago

The negotiations are mostly the UK trying to maintain some of the trade and immigration agreements they had while in the EU. They're welcome to just go "fuck you" and leave, but they will be absolutely destroyed by doing so.

Zhyl• 9 years ago

In the current parlance, this is called the 'No Deal'.

Scorponok2• 9 years ago

Because the EU could then reject those terms and not having a trade deal would be vastly more damaging to the UK than the EU.

gaius5• 9 years ago

No it can't - it's as bound by Article 50 as the UK is.

AndrewDucker• 9 years ago

Who would sign a trade deal with a country which reneged on its agreements?

juandazapata• 9 years ago

Because relationships between countries don't work in the same way as relationships between teenagers?

sz4kerto• 9 years ago

Because _everything_ that happens between countries (and between the UK an the EU) is driven by treaties and agreements.

Simple example: if UK leaves without agreements and treaties then there can be no flights from the UK to the EU. This sounds crazy but we have tens of thousands of bilateral agreements that drive even the most fundamental things, and they can be (and are) affected by e.g. the EU membership.

Or UK citizens would not be able to buy products from the EU because there would be no agreements in place that'd allow companies in the EU to export goods. Yeah, as soon as you BMW breaks down that's it, because no spare parts would be available.

Yes, it's this important.

tzahola• 9 years ago

Buy a Jaguar then ( ͡° ͜ʖ ͡°)

jstanley4• 9 years ago

Or UK citizens would not be able to buy products from the EU because there would be no agreements in place that'd allow companies in the EU to export goods.

This is where you and I fundamentally disagree about how trade works.

If I want to trade with a person in a foreign country, I don't see why our governments need to even know, let alone come up with some agreement. If the foreign person and I can agree a deal, why can't we trade without asking permission from our governments?

gaius5• 9 years ago

Article 50 specifies exactly what will happen: WTO rules will apply.

I think most people now are assuming WTO and considering anything else to be a bonus.

interdrift6• 9 years ago

WTO deals can take years to negotiate. The U.K's land of heaven is lobbying in Brussels so they can get a fair to everyone deal. As my British friends say, can't have your cake and eat it.

Tomte• 9 years ago

„WTO rules“ are just a framework for trading rules. Those rules itself still need to be negotiated.

For example, „which form do you have to fill with which information in how many copies, in order to export pastry?“.

That‘s much faster than a real trade deal, because it‘s mostly administrative, but it is still a hurdle to clear before you can trade under „WTO rules“.

And now do that for a gazillion sectors and special cases. With every trading partner.

dboreham• 9 years ago

Convention that you don’t break treat obligations (presumably because consequences of doing so would be very bad)?

Dayshine• 9 years ago

For the same reason your friends will refuse to go to dinner with you if you skip on the bill.

There are literally hundreds of collaborations between UK organisations and EU organisations. If we just stop our promised contributions to all of them they're not going to trust us again.

gaius5• 9 years ago

For the same reason your friends will refuse to go to dinner with you if you skip on the bill.

What about if you refuse to split the bill for the next dinner, to which you aren't invited?

1undo3• 9 years ago

For the same reason your friends will refuse to go to dinner with you if you skip on the bill.

What if you had very little choice on what was ordered for dinner? and ate almost nothing at dinner. You wouldn't want to pay right?

interdrift6• 9 years ago

1. UK has obligations to the EU for the 2020 (already have deals & contracts), other than that they're free to leave. Of course you can just leave and end up with a chaotic situation where nobody knows how trading works, there are tariffs.

Opinion : UK is going toward vassal state status to the EU by not having a say but still having to follow their rules.

WhirlingBirdz3• 9 years ago

Similar to the other "vassal states" such as Norway and Switzerland.

I'm not sure that the debate here is very sensible or measured.

I think that Brexit is a tragedy, and dearly hope it doesn't actually happen. That is my opinion. But it seems difficult if not impossible to have a reasoned argument about any aspect of it; people are entrenched in their corners.

neaden• 9 years ago

Because the EU will say no and Britain will be screwed. It wouldn't be great for the EU either, but it would hurt them a lot less.

jballanc• 9 years ago

Because the U.K. is not self-sufficient. Actually, I'm fairly certain that no country in today's world is self-sufficient. That means that for people to get by, day-to-day, the U.K. will need to import "stuff". If they were to simply up-and-leave the EU, chances are that the EU would retaliate by:

* closing borders with the U.K.

* embargoing or imposing severe tariffs on U.K. exports

* raise prices on U.K. imports to cover the monies not paid by the U.K.

So the U.K.'s choices are to:

* pay, in effect, what they owe (in the forms of tariffs and penalties) with zero bargaining position

* find enough other countries to trade with (who are willing to also thumb their nose at the EU) to make up for the goods and services they had been getting from the EU

* negotiate a clean exit

toyg4• 9 years ago

embargoing or imposing severe tariffs on U.K. exports

They don't even have to actually do anything to achieve that. WTO rules basically establish such tariffs already.

raise prices on U.K. imports to cover the monies not paid by the U.K.

Same here. Also, additional tax revenues would likely be collected on business "redirected" from the UK towards internal companies.

I still hope we'll get another referendum before we reach a point of no return.

1undo3• 9 years ago

The European Union wants to maintain centralized power. A Country like the UK leaving weakens their authority. Meanwhile the uk wants to remain sovereign, but doesn't want to lose the benefits of the EU. Its essentially a power play. Freedom is the better choice imo

interdrift6• 9 years ago

You're portraying things a black and white and this is not even remotely the case.

goneri• 9 years ago

This is a pure opinion based comment with no fact and a naive conclusion. This extremely complex topic deserves better, especially on HN.

ubersoldat2k7• 9 years ago

Actually, the other way around. Without the UK blocking many integration policies, the EU will have an easier road ahead to approve them, like military, legal and tax integration.

317070• 9 years ago

The UK can do that. The most likely consequence will be the EU not accepting those trade terms. As a consequence, almost all trade with the UK will stop and trade with the UK will effectively be under near embargo due to the high tarrifs from parts of the world (the EU and areas it has trade agreements with).

pm902• 9 years ago

You could say this about any treaty, any agreement. And technically, a Sovereign Nation, by its very definition, is allowed to do whatever the fuck it wants.

Before 20th century, breaches of treaties were grounds for war. Now we don't do that anymore, we simply cut off trade.

So the U.K would be ostracized, International companies would move out, it would probably face high tariffs on goods (or outright ban) etc.

dragonwriter3• 9 years ago

Why can’t the U.K. just leave? Say we are gone, we are not giving you any money, and unilaterally state a position on trade terms?

The UK can just leave—that’s what happens automatically with no deal, it leaves the E.U. and is in the same position as any other non-member country with no trade agreement with the E.U.

A lot of business in the UK has been dependent on its trade position in Europe, and there are even political stability issues tied in with that (the Irish border and it's relation to the situation in Northern Ireland, particularly.) So the UK can't afford to walk away, though they are perfectly free to do so.

masklinn• 9 years ago

Why can’t the U.K. just leave? Say we are gone, we are not giving you any money

They can, but then travel and trade becomes ~illegal between the UK and pretty much everyone else, the powder keg of NI starts heating back up, you've got a bunch of britons illegally present in mainland EU and likewise mainland residents in the UK, …

Oh and the UK becomes known for having no respect for international deals, which makes their positions weaker in every future international agreement.

and unilaterally state a position on trade terms?

And the EU unilaterally states "no" and then what?

dragonwriter3• 9 years ago

They can, but then travel and trade becomes ~illegal between the UK and pretty much everyone else

Reverting to WTO rules and hard (but not closed) borders isn't trade and travel being illegal, but it is a lot less free than the state when the UK was in the EU.

ZenoArrow6• 9 years ago

"They can, but then travel and trade becomes ~illegal between the UK and pretty much everyone else"

That's bullshit. WTO trade rules would still apply if the UK left the EU without a deal, and freedom to come and go outside the EU could still remain unchanged regardless of what Brussels wants to impose.

pimmen3• 9 years ago

You absolutely can just leave!

Now, lets say the five times larger economy doesn't accept your unilateral trade position, who just happens to be by far your largest and closest trading partner, what do you think happens then to your companies who are reliant on the EU market? Even if you don't work for such a company, what do you think would happen to your employer's clients? And if you work in the public sector, what do you think will happen to the tax revenue from those companies?

More than 20% of the UK's GDP is made up of exports to the EU. What do you think will happen to the government that cost the country millions of jobs because of one stupid decision to appease populists come election year? That's why the government can't just leave because it would be extremely popular in the short term but within a few years bring about very dire consequences.

yk• 9 years ago

Details. So for starters, the EU currently regulates a lot of what may be sold as food, regulations that just no longer apply if UK leaves. So they have to go through all the EU regulations first just to determine which are necessary to keep safe food in British supermarkets.

Then you get the international problems directly connected to that, what can you import into Britain and at which tariffs. Plus, how do you cooperate between air traffic control across the channel and across the Irish sea. (While we are at it, is British Airways allowed to fly over France, without EU law?)

And that is just the things Britain has to figure out on their own. Ireland, France and the rest of the EU have interest in British tariffs and if Britain sets tariffs unilaterally they will respond in kind, a situation sometimes known as trade war.

So yes, in principle Britain could just state a position on terms of trade, a hard Brexit, but that would mean that the EU responds in kind. Neither the EU nor Britain wants to do that, but the thing is the EU is something like 10 times as big as Britain and so the EU can very comfortably wait for Britain, because Brexit only affects something less than 10% of the EU trade, not over half of all trade as for Britain.

unchocked• 9 years ago

Delusions are hard to get rid of. Leave campaigned on lies, voters swallowed them, and the government is now bound to try and live by those lies.

Like all delusions, this will continue to entrench itself against reason. When the negotiators fail to reach their delusional goal, the deluded will formulate a conspiracy narrative to protect their delusion.

ravloony• 9 years ago

I don't subscribe to this at all. I think that the better explanation is that the people who are negotiating with the EU are, almost to a man, convinced EU-philes (for want of a better word). And so they favour the EU position in the negociations, instead of just implementing the will of the people.

auxbuss• 9 years ago

and the government is now bound to try and live by those lies.

This is a false assessment. The European Union Referendum Bill 2015-16[0] specifically states:

"This Bill requires a referendum to be held on the question of the UK’s continued membership of the European Union (EU) before the end of 2017. It does not contain any requirement for the UK Government to implement the results of the referendum, nor set a time limit by which a vote to leave the EU should be implemented. Instead, this is a type of referendum known as pre-legislative or consultative, which enables the electorate to voice an opinion which then influences the Government in its policy decisions."

[0] http://researchbriefings.files.parliament.uk/documents/CBP-7...

WhirlingBirdz3• 9 years ago

Brexit is bad for the UK. We can all agree on that?

But it's also a TRAGEDY for the EU. They've lost one of their principal contributors, as well as prestige and status. This is generally not talked about.

The EU are negotiating HARD. Why? Because they are in a position of weakness. If they were in a position of strength then they would let the UK go easily.

Everyone knows this.

The complications are that the UK political establishment and business community don't actually want to leave the EU. Hence the desperate attempt by UK negotiators to keep as much of the old system as possible, to the anger of the proletariat.

interdrift6• 9 years ago

This is not true. Brexit is good for the UK and the EU. Now finally clowns like Farage will be exposed for their 'rebel for good' fake ideals. The British public will either accept it's own sentence following decades of 'the bad bureaucrats in Brussels' fake news or come to realize that cooperation at both economical and political on large scale is the way to move forward.

WhirlingBirdz3• 9 years ago

Brexit isn't about Farage. As you say, he is a clown, a distraction, and a totem for the anger of middle-class metropolitans.

Brexit was about the working-class of the UK who voted to leave the EU, and their reasons for doing that.

dahdum2• 9 years ago

Brexit is bad for the UK in the short term, but if the EU continues to destabilize and collapse, they could do far better.

EU sells the single market at the cost of sovereignty, UK decided to go shop around.

toyg4• 9 years ago

it's also a TRAGEDY for the EU.

Lol, this is something only the British press peddles.

Across Europe the overwhelming feeling, for people without UK interests, is of relief. Finally they got rid of a recalcitrant member, the main opponent to "ever closer union" projects, the leader of the free-trade gang that is now in ruins (also embodied in the attacks on Ireland and Luxembourg tax affairs, the harshness on Poland and Hungary and so on), an annoying magnet to EU money flows and institutions, one of the main conduit for tax evasion across the Union... And all this without having to concede on anything, because Brits just did it all themselves!

The net difference in contributions to the EU budget is minor, even without an agreement it would be easily absorbed. The insistence on the principle of paying for the agreed budget was just because they could. In fact, haggling on that was much shorter than on things like ECJ role and Irish border, which are not really settled yet. Nobody really cared about the money.

This is generally not talked about

Guess why? Because it's not really the case.

dahdum2• 9 years ago

I'm not in the UK or EU, so I don't know what the mood is or have opinions about how the vote was conducted. But most economists I've read are not bullish on the EU doing better after Brexit, and it seems like "leave" parties have been coming to power over the past year.

Is that view so incorrect?

orwin2• 9 years ago

It's bad for german power in the EU, but i don't think it's a tragedy for the EU. The UK paid more to the eu than what he got back, that's a fact, but the right to trade European currency is what made the City this powerfull (compared to Paris, Franckfurt, Zurich). I'm pretty sure the taxes on income from displaced trading centers will make up for the "loss" for EU budget.

Also, the skill loss for EU is almost nil, while UK will lose europeen skilled workers (and those contribute a lot to GPD).

59nadir• 9 years ago

The EU doesn't _need_ the UK, but the UK very much needs the EU and it'll have to abide by the same regulations they would as members if they want to trade with anyone who currently trades with the EU anyway. You'll be getting the same regulations without any of the benefits of membership.

coldtea2• 9 years ago

Or, the EU is deluded about its worth in the modern world.

pimmen3• 9 years ago

But not about its worth to the UK. The EU is by far the UK's largest market and still has a lot of growth potential (especially in the southern and eastern member states).

coldtea2• 9 years ago

They're some assumption here that because of Brexit UK will not be able to export to the EU?

They'll sort it out just fine, just like the EU is trading partner with China and all kinds of countries that are not in the EU.

In fact, the UK not being in the EU could give it extra leverage (on labor laws, taxes, etc) to attract businesses in the ways the EU could not. Like Ireland that got in trouble with EU for its tax breaks.

junkscience20172• 9 years ago

the EU is rapidly turning in to a union with few willing and satisfied participants

the EU would be much better off letting disgruntled states go, even if it diminishes the size and prestige of the remaining union, unless the bureaucrats relish spending the next fifty years in endless, pointless debate and hand-wringing

the UK isn't alone. I doubt the EU will see 2030 in its current form.

Myrmornis• 9 years ago

Note that this article was published on Nov 9th. That's old on the timescale relevant to this topic.

temp-dude-878443• 9 years ago

It's truly ironic (and unfortunate) that the UK's tribulations to leave the EU have such close parallels to its difficulties joining its predecessor. In many ways, it demonstrates the weakness (both now and then) of the British economy and (peaceful) political force projection when pit against a united continental core -- led then by France and Germany, nowadays by Germany and France.

The UK has much more military leverage than economic leverage. The question of the common market is an economic matter, but the free movement of peoples can go either way. There are factions in all states that would rather treat the latter issue as a matter of civil defence, but that would require the UK engaging in force projection so close to home, which it has for almost half a century closely avoided.

doktrin3• 9 years ago

The UK may be one of the only European countries to take military spending seriously, but attempting to leverage that advantage in any kind of "direct" manner would probably backfire. Aside from lacking the political will to actually press the issue, they're not really that superior to their neighbors :

https://www.globalfirepower.com/countries-comparison-detail....

Note that France's GFP rank is technically higher than the UK's. This obviously ignores certain intangibles, and I personally would put higher stock in the British armed services than in any continental military - but the fact remains that they're not head and shoulders above the rest. They're not the US with its unquestionable military superiority, and they're not even China who enjoy massive military (and economic) asymmetry vis a vis their neighbors.

I do tend to think that UK military capabilities could be a valuable negotiating tool, particularly in uncertain times and in the face of (or fear of) potential Russian aggression - but I honestly don't see how they could successfully bully their way to a favorable resolution.

temp-dude-878443• 9 years ago

The classic way to engage in peaceful force projection is to do something drastic but oriented inward, with international implications, and implicitly challenge the world to do something about it. One way would be to institute unilateral border restrictions not unlike the ones just passed in the US.

Other states would balk at such a move, and talks of sanctions would likely follow, but the UK will have proven that they can throw their weight around, framing the narrative to ostensibly take their national interest over a supranational body. Since no one is willing to escalate beyond diplomatic and economic punishment, they will get their way.

ufo• 9 years ago

Is undoing brexit (fully or partially) still an option? If not, is it because the UK government is still committed to brexit or is it because what has been done so far is irreversible?

PeterisP4• 9 years ago

I recall statements from EU that they'd accept "take-backsies" of the Article 50, so from that perspective it would be an option; however it seems politically implausible for any UK government to do so after the referendum, at least without some serious mandate from the population i.e. a landslide election victory on a Remain platform paving the way for a repeat referendum, but scenarios like that are more similar to fiction than reasonable speculation.

Britain is, and was, deluded about its negotiating power with the EU

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