Tuesday, 21 March 2017

738 Days Until Brexit

And so we're off. Or at least we will be in just 8 days time when Theresa May will finally send that letter beginning the process of our leaving the EU. Typically the EU will then take 48 hours to respond to said letter, but Jean-Claude Juncker has let it be known early that they will present us with a €60 billion bill and that until we agree to pay up there will be nothing to talk about.

Well, we will see about that.

It is easy at this stage for the EU and in particular the Commission to talk tough and present a united front. But one of the reasons that we are getting out and why the whole ridiculous farrago is so dysfunctional is because it finds it impossible to talk as one voice, to present a united front. The EU cannot even all agree on the threat that Russia poses, let alone what relationship they should have with a country like Britain that has the biggest defence budget on the other side of Europe and is a net importer of products from the EU. Furthermore we are a major employer of their citizens, have industries and businesses integrated with their own and our banking industry is one they rely on. It's all very well for a panjandrum like the always bumptious and effete Juncker to try and talk tough. He is unelected. Proper politicians know that a deal will have to be done for the sake of their own economies, workforces and businesses. Britain is a huge loss to the EU. But an accommodation means that it need only be our annual contribution that is lost.

To be clear the demand for that €60 billion is about as meaningful as the SNP's demand for a referendum because they wish to stay in the EU, something that is not politically or legally possible or Nigel Farage's demand for a knighthood, something that is......well, something that just isn't. They do not have a legal leg to stand on with this 'demand.' Hence Juncker's getting his retaliation in first. Perhaps the jumped up buffoon thinks he can pressurise us early on. There are many ways we can seek to retaliate if they insist upon this imaginary bill. As net contributors for the next two years that is €20 billion of leverage we have straight away. More than that though this notion of demanding €60 billion is so very very EU, fantastically blinkered, elitist, purblind zealotry. If they were actually serious about this, this made up number, would it actually make sense to demand that of us or else suggest we walk away? Are they really willing to jeopardise a market for their exports that earned them £290 billion and with which they enjoy a substantial trading surplus? Are the Germans happy to wave goodbye or at least au revoir to a marketplace that buys a fifth of all of their entire car output? Is Europe, as opposed to the EU Commission, really willing to risk a recession just because they don't  like democracy very much?

There are of course going to be many bumps along the road in the coming two years, many highs and lows, much intrigue, much briefing and counter briefing, leaks, leaks of leaks, much confected anger. But the bottom line is that the phoney war is now over. Theresa May now has all of her files in place, her team ready. Britain is leaving. As we said all along, we are not leaving Europe, we are just leaving the EU. We will remain friends and neighbours, trading partners, security partners, providers of high quality intelligence and a vast market for a continent that is finding growth hard to come by. We will get a deal, precisely because Europe is corrupt, venal and divided, but also because it is always about looking after number one and nothing to do with 27.

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