Cross-posted from The Daily Telegraph
Those who called for a clean Brexit from the outset were right. The Franco-German axis is determined to make a soft arrangement impossible. Any further talking at this point wastes time and tightens the noose around our own necks.
If Britain is to leave the EU – as it must, after a clear popular vote, endorsed by Parliament, and written into the Tory and Labour manifestos – the only way to do so with economic and political coherence is to reassert full sovereign self-government.
Sadly, I have concluded that we are left with no choice other than to invoke our rights as members of the World Trade Organisation and accept tariffs (mostly very low, but still unwelcome) until free trade deals can be agreed one by one with the US, China, Japan, India, and other countries. The wheels should be set in motion immediately. It will be impossible in another six months.
Berlin, Paris, and Brussels have stated with crystal clarity that no deal on services is available. The only free trade pact they are willing to offer is on goods.
This is prohibitively asymmetric: it locks in their huge surplus (mostly German) in manufacturing, while locking out Britain’s surplus in services, which partly compensates. Those who talk loudest about cherry picking pick the biggest the cherries.
What the EU is offering is not a deal worth having. It is possible that other countries – Ireland, Holland, the Nordics, and perhaps Spain, Italy, and Poland – will succeed in pushing for a more friendly and equal settlement but I would not count on it. By the time we find out, it will be too late. My experience as Brussels correspondent and then later covering the eurozone crisis taught me that Germany usually succeeds in imposing its will, disguising its power behind French camouflage and the EU institutions.
My fears have been confirmed by the hostile tone of EU documents since Theresa May went the extra mile to ensure concord at the December summit. Her offers of money and her gestures of goodwill have simply been pocketed.
The latest provocation is an internal strategy paper leaked to the Financial Times showing that the EU intends to tie Britain down after Brexit by prohibiting or curbing future moves to cut taxes, to deregulate, to carry out an industrial strategy, or make changes to employment law, all under pain of sanctions. It threatens to treat the UK as a pariah if it does not comply…
Continue reading the article (but only if you have a subscription to the DT’s Premium content)