Brexit: Third Act

My Sunday article, just published on Impakter, I found a great featured image with Munch’s famous “Scream” (Creative Commons, photo by David Holt) and here’s the title:

Brexit: The Point of No Return? What Can Be Done?

And the opening:

Are we approaching the point of no return with Brexit? And is there anything that can be done? It can’t be proved, but it looks suspiciously like Prime Minister Theresa May is deliberately engineering drama in order to get her “deal” – the Withdrawal Agreement with the EU – approved by the U.K. Parliament.  She seems to be pushing the clock to the last minute before midnight of 29 March – Brexit’s deadline, the date she set herself by triggering Article 50, now almost two years ago.

She’s aiming for that date like a straight arrow, telling Parliament that she sees no possibility of a second referendum. That’s something she has said many times over the past year: There will be no second Brexit referendum. And even less new elections. A proposed cross-party amendment to Theresa May’s Brexit plan calling for a “people’s vote” was ditched earlier last week because of lack of Labour party support.

Poor Britain, one could feel sorry that at this crucial juncture, the U.K.’s two leading politicians are clearly anti-Europeans and don’t have at heart the welfare of their fellow citizens. They are not the kind of people who will revise their opinions in the light of emerging evidence that Brexit is a very bad idea.

Theresa May started in the Remainers’ camp when she was still in Cameron’s government, but after Brexit, she saw her opportunity to become Prime Minister and she quickly jumped to the other side. Clearly, she won’t let go – not until she has Brexit where she wants, beyond the point of no return. As to Jeremy Corbyn, the Labour leader, he has been a Euro-skeptic all his life and he’s not about to change his opinions, even if Brexit in fact hurts the working classes the most.

Bloomberg’s Brussels Edition calls it “Brexit Fog” as no deal for an orderly withdrawal is yet in sight. As far as the EU is concerned, the deal struck with Prime Minister Theresa May last month is the only possible one, nothing else can be envisaged. May is currently trying to win over Labour Party rebels to her deal and more generally, laying the groundwork for a possible delay on Brexit. At the time of writing, nobody knows whether she can succeed or not.

Brexit is unquestionably the most damaging foreign policy move the U.K. has ever contemplated in its whole History. With Brexit now approaching the point of no return, the costs of a “no deal Brexit” are becoming painfully clear to everyone.

No-Deal Brexit Damage to the U.K.

The U.K. food industry is in a panic, expecting a food emergency to explode after March 29 when all the borders with the EU will close down. On 28 January,  UK food retail chief executives issued a “no-deal Brexit” warning in a letter that was also signed by Marks & Spencer managers. They noted:

“Our supply chains are closely linked to Europe – nearly one third of the food we eat in the UK comes from the EU. In March, the situation is more acute as UK produce is out of season: 90% of our lettuces, 80% of our tomatoes and 70% of our soft fruit [are] sourced from the EU at that time of year. As this produce is fresh and perishable, it needs to be moved quickly from farms to our stores,”

The problem is the “just-in-time” food supply chain. If it is disrupted, it will be a disaster foretold.

Food retailers are stockpiling food where possible but all the available frozen and chilled storage space in the U.K is already in use and there is little further general warehousing space. The UK authorities might decide not to check products at the border, but the French have already announced they will enforce sanitary and customs checks at Calais as they are forced to do on all exports from the EU to outside countries. As a result, freight trade at Calais and Dover is expected to be reduced by as much as 87%.

In short, food will cost more and the poorest will be hit the hardest.

But food is not the only industry hit by a no-deal Brexit – all areas, from fashion to cars are going to hurt, and the working classes in particular will feel the pain as factories shut down and jobs move abroad.

The problem is that for 30 years, industry supply chains have been built to fit into the EU system. To repurpose them will be a gargantuan task, made all the more difficult as the U.K.’s free entry into the vast EU market closes up, discouraging investors and extra-European manufacturers like the Japanese who have used the U.K. as a door to jump into Europe.

The so-called “Ireland backstop” is another potentially catastrophic problem. The whole of Ireland, North and South, does not want the clock to be turned back to a state of war. In the words of Irish Foreign Minister Simon Coveney:

“It is vitally important that politicians in Westminster understand the overwhelming wish across society in Northern Ireland not to return to borders and division of time past”.

No-Deal Brexit Damage to the E.U.

The damage will be far more serious than is commonly thought.

…

To read the rest and find out how badly it will go for the EU, click here.

Advertisement

Brexit Deadlock: What Next?

I wrote about the Brexit deadlock for Impakter and here is the start of my updated article that examines the options following the U.K. Parliament’s rejection of May’s “Brexit deal” and her surviving the no confidence vote called for by Labour on 16 January 2019:

Ten weeks to Brexit. March 29, the date of UK’s exit from the EU, is closer than ever. But right now we are living through a “Brexit deadlock”. And it shows no sign of resolving: First there was the historic contrary vote in Parliament on 15 January that rejected Prime Minister May’s controversial “Brexit deal”. The margin of defeat was enormous, May lost by 230 votes. Next, on 16 January, May survived the vote of no confidence Labour Leader Corbyn had called for, with a thin majority of 19 votes.

The defeat, however predictable and expected, still managed to shock many people. And EU Commission President Juncker expressed regret:

I take note with regret of the outcome of the vote in the @HouseofCommons this evening. I urge the #UK to clarify its intentions as soon as possible. Time is almost up #Brexit https://t.co/SMmps5kexn

— Jean-Claude Juncker (@JunckerEU) January 15, 2019

The EU Commission also released a formal statement on 15 January by President Juncker highlighting that the “process of ratification of the Withdrawal Agreement continues.  Because this Withdrawal Agreement (i.e. May’s “Brexit deal”) is:

“a fair compromise and the best possible deal. It reduces the damage caused by Brexit for citizens and businesses across Europe. It is the only way to ensure an orderly withdrawal of the United Kingdom from the European Union.”

The EU won’t budge on the Irish border problem. This is it – end of the road. As EU Council President Donald Tusk was quick to note , the U.K. should cancel Brexit since no better deal can be negotiated.

The problem is a political one. As Guardian’s John Henley said, ““The crux of the problem is that there is no parliamentary majority for any solution. There is no majority for May’s deal, there is no majority for no deal, there is no majority for a second referendum, and there is no majority for the various alternative deals mooted by MPs.”

The logic is to go back to the people and vote again, as suggested by Susan Wilson in her recent article on Impakter celebrating “2019: The Year We Finally Bury Brexit“. That is also what the markets expect and the pound immediately rebounded.

Unfortunately, little time is left to organize a referendum. Some people argue there’s no time left at all.

Yet a no-deal Brexit was excluded by a crucial Parliament vote on 8 January that passed almost unobserved by the mainstream media. But that vote ensured, to use Labour Leader Jeremy Corbyn’s expression, that the UK cannot “legally go crashing out” of the EU on 29 March 2019:

…

The rest on Impakter, click HERE to read. Let me know what you think!

Dangerous Times for Democracy: Italy in the Eye of the Storm

Just published on Impakter the article of a friend of mine, currently visiting Italy. I think that what she says is important and I wanted to share it with you.

You’ll see that her reaction to the situation in Italy (and Europe) is very different from Thomas Friedman’s, the New York Times brilliant columnist who also happens to be visiting Italy these days. And from my standpoint – and I think it matters, after all, I live in Italy, I’ve been here over 40 years, I read the Italian papers every day, interacting with my Italian friends and overhearing people in the street and at the bar where I go for my daily espresso –  well, in the light of what I know of Italy, I honestly think my friend got it right and Friedman didn’t quite get it. Yes, his analysis is excellent, spot on, but his conclusion is a tad too negative…

Judge for yourself, here’s the beginning:

Writing from Italy, New York Times foreign affairs Op Ed columnist and Pulitzer winner Thomas L. Friedman claims in a new not-to-be-missed piece that he will “ruin your breakfast, lunch and dinner “ and he certainly does. He argues that if Putin, Trump and Bannon (presently roaming across Europe to raise trouble) succeed in breaking up our “community of democracies”, we are toast. There will be a power vacuum. Who will defend human rights and democracy? You certainly can’t count on China or Russia to save our Western values.

Italy seems to have inspired him, or perhaps helped clear his vision of what are the true challenges we are facing in Europe. And, as I too write from Italy, I can only agree with him. Up to a point. Let me clarify.

First, of all, he is right, it’s not only Brexit. Or the rise of populism. Or Putin’s interferences with elections in Europe. Or immigrant waves driven by “the environmental and political disorder from the south”, the war in Syria, the political mess in Libya, the poverty across Africa. Or the lack of cooperation within the European Union, with East European members (the Visegrad Group) most at fault, preventing any solution to the immigration problem. Or, because of Trump, an isolationist U.S.  It’s all of them, a perfect storm. And the eye of the storm is in Italy.

…

Read the rest on Impakter, click here.

Europe: Time to Clean Up Your Act!

Seven months ago, I blogged about the ignominious stance of Ms. Merkel’s Germany, weighing down on poor little Greece, stripping it bare so it would repay its debt – in short, dangerously rocking the Euro boat and nearly sinking it. That post was titled: “Shame on You Germany, You are Killing the European Project”.

How times have changed in just seven short months!

Now Europe is facing the twin challenge of Brexit and the refugee crisis.

Student debate held at Speak Up November 2015 (video here)

Brexit – if it actually leads to the UK’s exit from the EU and, for now, the chances that it will are about even – could open the way for other Euro-skeptical countries to leave, particularly East European countries like Poland and Hungary that seem to have forgotten how happy they once were to escape from the Soviet Empire.

The refugee crisis has seen an extraordinary change of heart in Merkel: all of a sudden, she has turned into Europe’s paladin, fighting for a generous, dignified humanitarian stand (in fact, the only one that would do justice to Europe’s values). By contrast, East and Central European countries, in a selfish, amoral and ungenerous fit, led by Hungary and Poland in this case too, are fighting Merkel and closing their borders with razor-thin walls, reminiscent of the infamous Berlin Wall.

This is a continent truly divided: on its western and eastern borders, EU members are hitting hard at the European project, while at the center, particularly in Germany, it has to valiantly grapple with the influx of over a million refugees and economic migrants.

The crisis is not longer at its doors, it’s within. Yet, in spite of the deadly urgency, the EU is still grappling in the dark, EU meeting after EU summit, for a solution.

Paralyzed.

Why? Are all our politicians stupid, don’t they realize that if they do nothing, voters at home will make them pay? Or is it the EU institutional framework that is causing paralysis? That framework was carefully constructed to preserve “sovereignty” so that no country joining the Union would lose one shred of its precious “national identity”.

Result? Political paralysis. Inability to take any decisions. Focus on irrelevant details (like the length of bananas or wrapping mozzarella cheese in paper) rather than keeping an eye on the main road.

Of all the institutional stupidities, the worst offender is the EU presidential system: here, since the Lisbon Treatycame into force in 2009, we have two “presidents” of Europe, one for the EU Council who is full time – first it was the Belgian Herman van Rompuy; now, since December 2014, it is Poland’s Donald Tusk –  and then we have a continuing six-month rolling presidency as each EU member country takes its turn at the helm. The next EU presidency falls to Slovakia.

And Slovakia in its recent elections has taken a turn away from Europe: its parties are dangerously anti-European. If you don’t believe me, read this excellent analysis in the New York Times: Slovakia’s Governing Party Loses Majority as Far Right Makes Gains.

My question is: why do we need a rotating presidency of EU member countries if we have a European President of the Council, a man who presides over the Council that consists of the heads of states or government of EU members as well as the President of the European Commission? Why is this President that comes closest to an individual selected by ALL European citizens (since he is elected by the European Parliament), why is he set aside every six months by whatever country that happens to take over the “EU presidency”?

This is a perfect recipe for political paralysis.

What kind of game are our politicians playing at? Obviously, this is a way to have more juicy positions to fill their pockets as they “rush to Brussels”. But it is at the clear expense of European citizens and tax contributors. Slovakia, once it is sitting in the presidential driving seat next July, can be counted upon to at best do nothing and leave the European machine stalled, and at worst, to promote its own anti-European agenda and force the European machine to backtrack.

Time to put a stop to this game and reform the EU institutions. Unifying Europe is a management matter: countries will need to leave behind  chauvinistic nationalism in order to rise up to the challenges and make decisions. Solutions will never be reached as long as countries cling to their antiquated national identity.

To begin with: cancel the six-month presidency turn-over game.  This is the only way to have a real European Union President. Someone we know who is dedicated to the European project. Someone who will push it forward and not stall it – as Slovakia no doubt will.

It’s only a start, but it would be a good start. Your views?

Update: Turkey is suddenly playing tough on EU demands to help it stem migrant flows – a stiff bargain that reveals how weak the EU really is. “EU Welcomes Bold Turkey Plan to Stop Migrants” is the way Reuters titled it (see here) EU “welcomes”? “Bold Turkey Plan”? In fact, the Turks simply asked for twice the money!