The Brexit negotiations are indeed at an impasse. There is no proposal now on the table which can get through the House of Commons. In her statement after the Salzburg meeting, the prime minister attempted to disguise that unpalatable truth by blaming her own domestic debacle on the 27. The government is in a hole. Rather than stop digging, May wielded a pneumatic drill. Her invective is not supported by the facts.
Since the negotiations started, unity has been the priority of the 27. That has not changed. As soon as the Chequers plan was published, the 27 said that it was not a basis for agreement. The UK could not, as a third country outside the European Union, expect to have the benefits of membership without the obligations. Nor would the EU accept a third country managing tariffs on its behalf.
May has challenged the 27 to match Britain’s proposals with their own. But they already have. As far as the 27 are concerned, the UK can have a Norway-style arrangement by which we remain in the EEA i.e. in the single market, but not in the customs union. We would have to accept freedom of movement, but could make our own trade deals. Or we could stay in a customs union, without the obligation of freedom of movement but also without the freedom to make our own trade deals. We could even combine these two arrangements. Or we could have a free trade agreement (FTA) like Canada, only probably somewhat better.
The first two options combined would offer ways by which the government might meet its obligation, freely entered into, to avoid a hard border between the Republic of Ireland and Northern Ireland. But they are unacceptable to the Tory irreconcilables and therefore to the government, which depends on those Brexiteer votes for its survival. For the Brexiteers, anything which keeps us closely moored alongside the EU is anathema. They want the freedom of the high seas: adrift or barely afloat is for them a matter of indifference. The FTA option, even with bells on, would be a poor substitute for what we have now since it would not give us the ability to export our services, especially financial services, freely to the EU. The irreconcilable Brexiteers would happily vote for such an outcome. That might just command a majority in the Commons but it would make it impossible to meet our obligations in respect of the Irish border.
“Brexiteers want the freedom of the high seas: adrift or barely afloat is a matter of indifference”So, the options acceptable to the EU are unacceptable to the government. The option acceptable to the Brexiteers would not be acceptable to the 27. Meanwhile, the Chequers proposal is equally unacceptable both to the EU and to the Tory irreconcilables, albeit for completely different reasons.
There are various ways in which the stalemate might be resolved. The UK could stay in the EEA for a period, during which the long-term relationship with the EU, and between the UK and Ireland, would be worked out. For the Tory Brexiteers this is unacceptable, because they fear that the short-term fix would become the long-term outcome. Or the UK could remove one source of friction with the 27 by abandoning Chequers and agreeing that membership of a Free Trade Area would be the ultimate state of our post-Brexit relationship. This would be a poor outcome for the UKeconomy, but it might make it easier politically for the 27 to agree to park the Irish border issue in the hope that it could be resolved during the transition period. Such an outcome could probably squeeze through parliament.
Two dramatic options are also much canvassed: a general election or a second referendum. Under the Fixed-term Parliaments Act, it is quite hard to provoke a general election. But the Tory irreconcilables might even be ready to bring down their own government in a confidence vote rather than accept a compromise. Which is why, when May repeated last week her assertion that no-deal was better than a bad deal, what she really meant was that those were the only two options allowed to her by a powerful group of her own backbenchers. If parliament remains incapable of agreeing on an outcome in the interests of country, rather than party, a second referendum could be the only way of avoiding the cliff edge of no deal. But if parliament is deadlocked the Tory Brexiteers might anyway prefer to provoke a general election rather than risk a referendum which they might lose.
If there were a general election, Labour would not campaign to keep the UK in the EU since it does well by appealing to both pro and anti-European sentiment in different constituencies. But it would be ready as a government to negotiate one of the outcomes I have described which would be acceptable to the 27 and better for the UK. Would that be enough to tilt the election in its favour?
