Oh, hear us when we cry to Thee, For those in peril on the sea.
Showing posts with label Norway. Show all posts
Showing posts with label Norway. Show all posts
Friday, 12 July 2024
Wednesday, 3 May 2017
The six Brexit traps that will defeat Theresa May
Yanis Varoufakis
“It’s yours against mine.” That’s how Wolfgang Schäuble, Germany’s finance minister, put it to me during our first encounter in early 2015 – referring to our respective democratic mandates.
A little more than two years later, Theresa May is trying to arm herself with a clear democratic mandate ostensibly to bolster her negotiating position with European powerbrokers – including Schäuble – and to deliver the optimal Brexit deal.
Already, the Brussels-based commentariat are drawing parallels: “Brits fallen for Greek fallacy that domestic vote gives you stronger position in Brussels. Other countries have voters too,” tweeted Duncan Robinson, Brussels correspondent of the Financial Times. “Yep,” tweeted back Miguel Roig, the Brussels correspondent of Spanish financial daily Expansión. “Varoufakis’ big miscalculation was to think that he was the only one in the Eurogroup with a democratic mandate.”
In truth, Brussels is a democracy-free zone. From the EU’s inception in 1950, Brussels became the seat of a bureaucracy administering a heavy industry cartel, vested with unprecedented law-making capacities. Even though the EU has evolved a great deal since, and acquired many of the trappings of a confederacy, it remains in the nature of the beast to treat the will of electorates as a nuisance that must be, somehow, negated. The whole point of the EU’s inter-governmental organisation was to ensure that only by a rare historical accident would democratic mandates converge and, when they did, never restrain the exercise of power in Brussels.
In June 2016, Britain voted, for better or for worse, for Brexit. May suddenly metamorphosed from a soft remainer to a hard Brexiteer. In so doing she is about to fall prey to an EU that will frustrate and defeat her, pushing her into either a humiliating climb-down or a universally disadvantageous outcome. When the Brussels-based group-thinking commentariat accuse Britain’s prime minister, without a shred of evidence, of overestimating the importance of a strong mandate, we need to take notice, for it reveals the determination of the EU establishment to get its way, as it did when I arrived on its doorstep, equipped with my mandate.
When I first went to Brussels and Berlin, as Greece’s freshly elected finance minister, I brought with me a deep appreciation of the clash of mandates. I said as much in a joint press conference with Schäuble in 2015, pledging that my proposals for an agreement between Greece and the EU would be “aimed not at the interest of the average Greek but at the interest of the average European”. A few days later, in my maiden speech at the Eurogroup of eurozone finance ministers, I argued: “We must respect established treaties and processes without crushing the fragile flower of democracy with the sledgehammer that takes the form of statements such as ‘Elections do not change anything’.” May will, I presume, go to Brussels with a similar appreciation.
When Schäuble welcomed me with his “it is my mandate against yours” doctrine, he was honouring a long EU tradition of neglecting democratic mandates in the name of respecting them. Like all dangerous hypotheses, it is founded on an obvious truth: the voters of one country cannot give their representative a mandate to impose upon other governments conditions that the latter have no mandate, from their own electorate, to accept. But, while this is a truism, its incessant repetition by Brussels functionaries and political powerbrokers, such as Angela Merkel and Schäuble himself, is intended to convert it surreptitiously into a very different notion: no voters in any country can empower their government to oppose Brussels.
There is a long EU tradition of neglecting democratic mandates in the name of respecting them
For all their concerns with rules, treaties, processes, competitiveness, freedom of movement, terrorism etc, only one prospect truly terrifies the EU’s deep establishment: democracy. They speak in its name to exorcise it, and suppress it by six innovative tactics, as May is about to discover.
Time to listen in, Theresa. Photograph: Russell Cheyne/Reuters
The EU runaround
Henry Kissinger famously quipped that when he wanted to consult Europe, he did not know whom to call. In my case it was worse. Any attempt to enter into a meaningful discussion with Schäuble was blocked by his insistence that I “go to Brussels” instead. Once in Brussels, I soon discovered that the commission was so divided as to make discussions futile. In private talks, Commissioner Moscovici would agree readily and with considerable enthusiasm with my proposals. But then his deputy in the so-called Eurogroup Working Group, Declan Costello, would reject all these ideas out of hand.
The uninitiated may be excused for thinking that this EU runaround is the result of incompetence. While there is an element of truth in this, it would be the wrong diagnosis. The runaround is a systemic means of control over uppity governments. A prime minister, or a finance minister, who wants to table proposals that the deep establishment of the EU dislike is simply denied the name of the person to speak to or the definitive telephone number to call. As for its apparatchiks, the EU runaround is essential to their personal status and power.
The Penelope ruse
Delaying tactics are always used by the side that considers the ticking clock its ally. In Homer, Odysseus’ faithful wife, Penelope, fends off aggressive suitors in her husband’s absence by telling them that she will announce whom among them she will marry only after she has completed weaving a burial shroud for Laertes, Odysseus’ father. During the day she would weave incessantly but at night she would undo her work by pulling on a loose string.
In my negotiations in Brussels, the EU’s Penelope ruse consisted, primarily, of endless requests for data, for fact-finding missions to Athens, for information about every bank account held by every public organisation or company. And when they got the data, like the good Penelope, they would spend all night undoing the spreadsheets that they had put together during the day.
Truth reversal
While practising the Swedish national anthem and Penelope ruse tactics, the Brussels establishment utilised tweets, leaks and a campaign of disinformation involving key nodes in the Brussels media network to spread the word that I was the one wasting time, arriving at meetings empty-handed; either with no proposals at all or with proposals that lacked quantification, consisting only of empty ideological rhetoric.
Sequencing
The prerequisite for Greece’s recovery was, and remains, meaningful debt relief. No debt relief meant no future for us. My mandate was to negotiate, therefore, a sensible debt restructure. If the EU was prepared to do this, so as to get as much of their money back as possible, I was also prepared for major compromises. But this would require a comprehensive deal. But, no, Brussels and Berlin insisted that, first, I commit to the compromises they wanted and then, much later, we could begin negotiations on debt relief. The point-blank refusal to negotiate on both at once is, I am sure, a colossal frustration awaiting May when she seeks to compromise on the terms of the divorce in exchange for longer-term free trade arrangements.
So what can Theresa May do?
The only way May could secure a good deal for the UK would be by diffusing the EU’s spoiling tactics, while still respecting the Burkean Brexiteers’ strongest argument, the imperative of restoring sovereignty to the House of Commons. And the only way of doing this would be to avoid all negotiations by requesting from Brussels a Norway-style, off-the-shelf arrangement for a period of, say, seven years.
The benefits from such a request would be twofold: first, Eurocrats and Europhiles would have no basis for denying Britain such an arrangement. (Moreover, Schäuble, Merkel and sundry would be relieved that the ball is thrown into their successors’ court seven years down the track.) Second, it would make the House of Commons sovereign again by empowering it to debate and decide upon in the fullness of time, and without the stress of a ticking clock, Britain’s long-tem relationship with Europe.
The fact that May has opted for a Brexit negotiation that will immediately activate the EU’s worst instincts and tactics, for petty party-political reasons that ultimately have everything to do with her own power and nothing to do with Britain’s optimal agreement with the EU, means only one thing: she does not deserve the mandate that Brussels is keen to neutralise.
“It’s yours against mine.” That’s how Wolfgang Schäuble, Germany’s finance minister, put it to me during our first encounter in early 2015 – referring to our respective democratic mandates.
A little more than two years later, Theresa May is trying to arm herself with a clear democratic mandate ostensibly to bolster her negotiating position with European powerbrokers – including Schäuble – and to deliver the optimal Brexit deal.
Already, the Brussels-based commentariat are drawing parallels: “Brits fallen for Greek fallacy that domestic vote gives you stronger position in Brussels. Other countries have voters too,” tweeted Duncan Robinson, Brussels correspondent of the Financial Times. “Yep,” tweeted back Miguel Roig, the Brussels correspondent of Spanish financial daily Expansión. “Varoufakis’ big miscalculation was to think that he was the only one in the Eurogroup with a democratic mandate.”
In truth, Brussels is a democracy-free zone. From the EU’s inception in 1950, Brussels became the seat of a bureaucracy administering a heavy industry cartel, vested with unprecedented law-making capacities. Even though the EU has evolved a great deal since, and acquired many of the trappings of a confederacy, it remains in the nature of the beast to treat the will of electorates as a nuisance that must be, somehow, negated. The whole point of the EU’s inter-governmental organisation was to ensure that only by a rare historical accident would democratic mandates converge and, when they did, never restrain the exercise of power in Brussels.
In June 2016, Britain voted, for better or for worse, for Brexit. May suddenly metamorphosed from a soft remainer to a hard Brexiteer. In so doing she is about to fall prey to an EU that will frustrate and defeat her, pushing her into either a humiliating climb-down or a universally disadvantageous outcome. When the Brussels-based group-thinking commentariat accuse Britain’s prime minister, without a shred of evidence, of overestimating the importance of a strong mandate, we need to take notice, for it reveals the determination of the EU establishment to get its way, as it did when I arrived on its doorstep, equipped with my mandate.
When I first went to Brussels and Berlin, as Greece’s freshly elected finance minister, I brought with me a deep appreciation of the clash of mandates. I said as much in a joint press conference with Schäuble in 2015, pledging that my proposals for an agreement between Greece and the EU would be “aimed not at the interest of the average Greek but at the interest of the average European”. A few days later, in my maiden speech at the Eurogroup of eurozone finance ministers, I argued: “We must respect established treaties and processes without crushing the fragile flower of democracy with the sledgehammer that takes the form of statements such as ‘Elections do not change anything’.” May will, I presume, go to Brussels with a similar appreciation.
When Schäuble welcomed me with his “it is my mandate against yours” doctrine, he was honouring a long EU tradition of neglecting democratic mandates in the name of respecting them. Like all dangerous hypotheses, it is founded on an obvious truth: the voters of one country cannot give their representative a mandate to impose upon other governments conditions that the latter have no mandate, from their own electorate, to accept. But, while this is a truism, its incessant repetition by Brussels functionaries and political powerbrokers, such as Angela Merkel and Schäuble himself, is intended to convert it surreptitiously into a very different notion: no voters in any country can empower their government to oppose Brussels.
There is a long EU tradition of neglecting democratic mandates in the name of respecting them
For all their concerns with rules, treaties, processes, competitiveness, freedom of movement, terrorism etc, only one prospect truly terrifies the EU’s deep establishment: democracy. They speak in its name to exorcise it, and suppress it by six innovative tactics, as May is about to discover.
Time to listen in, Theresa. Photograph: Russell Cheyne/Reuters
The EU runaround
Henry Kissinger famously quipped that when he wanted to consult Europe, he did not know whom to call. In my case it was worse. Any attempt to enter into a meaningful discussion with Schäuble was blocked by his insistence that I “go to Brussels” instead. Once in Brussels, I soon discovered that the commission was so divided as to make discussions futile. In private talks, Commissioner Moscovici would agree readily and with considerable enthusiasm with my proposals. But then his deputy in the so-called Eurogroup Working Group, Declan Costello, would reject all these ideas out of hand.
The uninitiated may be excused for thinking that this EU runaround is the result of incompetence. While there is an element of truth in this, it would be the wrong diagnosis. The runaround is a systemic means of control over uppity governments. A prime minister, or a finance minister, who wants to table proposals that the deep establishment of the EU dislike is simply denied the name of the person to speak to or the definitive telephone number to call. As for its apparatchiks, the EU runaround is essential to their personal status and power.
Picking opponents
From my first Eurogroup, its president, Jeroen Dijsselbloem, the Dutch finance minister, began an intensive campaign to bypass me altogether. He would phone Alexis Tsipras, my prime minister, directly – even visiting him in his hotel room in Brussels. By hinting at a softer stance if Tsipras agreed to spare him from having to deal with me, Dijsselbloem succeeded in weakening my position in the Eurogroup – to the detriment, primarily, of Tsipras.
From my first Eurogroup, its president, Jeroen Dijsselbloem, the Dutch finance minister, began an intensive campaign to bypass me altogether. He would phone Alexis Tsipras, my prime minister, directly – even visiting him in his hotel room in Brussels. By hinting at a softer stance if Tsipras agreed to spare him from having to deal with me, Dijsselbloem succeeded in weakening my position in the Eurogroup – to the detriment, primarily, of Tsipras.
The Swedish national anthem routine
On the assumption that good ideas encourage fruitful dialogue and can be the solvents of impasse, my team and I worked hard to put forward proposals based on serious econometric work and sound economic analysis. Once these had been tested on some of the highest authorities in their fields, from Wall Street and the City to top-notch academics, I would take them to Greece’s creditors in Brussels, Berlin and Frankfurt. Then I would sit back and observe a symphony of blank stares. It was as if I had not spoken, as if there was no document in front of them. It would be evident from their body language that they denied the very existence of the pieces of paper I had placed before them. Their responses, when they came, would be perfectly independent of anything I had said. I might as well have been singing the Swedish national anthem. It would have made no difference.
On the assumption that good ideas encourage fruitful dialogue and can be the solvents of impasse, my team and I worked hard to put forward proposals based on serious econometric work and sound economic analysis. Once these had been tested on some of the highest authorities in their fields, from Wall Street and the City to top-notch academics, I would take them to Greece’s creditors in Brussels, Berlin and Frankfurt. Then I would sit back and observe a symphony of blank stares. It was as if I had not spoken, as if there was no document in front of them. It would be evident from their body language that they denied the very existence of the pieces of paper I had placed before them. Their responses, when they came, would be perfectly independent of anything I had said. I might as well have been singing the Swedish national anthem. It would have made no difference.
The Penelope ruse
Delaying tactics are always used by the side that considers the ticking clock its ally. In Homer, Odysseus’ faithful wife, Penelope, fends off aggressive suitors in her husband’s absence by telling them that she will announce whom among them she will marry only after she has completed weaving a burial shroud for Laertes, Odysseus’ father. During the day she would weave incessantly but at night she would undo her work by pulling on a loose string.
In my negotiations in Brussels, the EU’s Penelope ruse consisted, primarily, of endless requests for data, for fact-finding missions to Athens, for information about every bank account held by every public organisation or company. And when they got the data, like the good Penelope, they would spend all night undoing the spreadsheets that they had put together during the day.
Truth reversal
While practising the Swedish national anthem and Penelope ruse tactics, the Brussels establishment utilised tweets, leaks and a campaign of disinformation involving key nodes in the Brussels media network to spread the word that I was the one wasting time, arriving at meetings empty-handed; either with no proposals at all or with proposals that lacked quantification, consisting only of empty ideological rhetoric.
Sequencing
The prerequisite for Greece’s recovery was, and remains, meaningful debt relief. No debt relief meant no future for us. My mandate was to negotiate, therefore, a sensible debt restructure. If the EU was prepared to do this, so as to get as much of their money back as possible, I was also prepared for major compromises. But this would require a comprehensive deal. But, no, Brussels and Berlin insisted that, first, I commit to the compromises they wanted and then, much later, we could begin negotiations on debt relief. The point-blank refusal to negotiate on both at once is, I am sure, a colossal frustration awaiting May when she seeks to compromise on the terms of the divorce in exchange for longer-term free trade arrangements.
So what can Theresa May do?
The only way May could secure a good deal for the UK would be by diffusing the EU’s spoiling tactics, while still respecting the Burkean Brexiteers’ strongest argument, the imperative of restoring sovereignty to the House of Commons. And the only way of doing this would be to avoid all negotiations by requesting from Brussels a Norway-style, off-the-shelf arrangement for a period of, say, seven years.
The benefits from such a request would be twofold: first, Eurocrats and Europhiles would have no basis for denying Britain such an arrangement. (Moreover, Schäuble, Merkel and sundry would be relieved that the ball is thrown into their successors’ court seven years down the track.) Second, it would make the House of Commons sovereign again by empowering it to debate and decide upon in the fullness of time, and without the stress of a ticking clock, Britain’s long-tem relationship with Europe.
The fact that May has opted for a Brexit negotiation that will immediately activate the EU’s worst instincts and tactics, for petty party-political reasons that ultimately have everything to do with her own power and nothing to do with Britain’s optimal agreement with the EU, means only one thing: she does not deserve the mandate that Brussels is keen to neutralise.
Sunday, 26 June 2016
The EU will treat Britain like Greece
Matthew Holehouse The Telegraph
I arrived in Brussels as the Daily Telegraph’s correspondent in early June, 2015. A fortnight later, Alexis Tsipras snubbed Brussels, and called a referendum on the third bailout that was designed to save the Eurozone from collapse.
The terms he was later given - €50bn of assets sold and a de facto control of economic policy surrendered - were so harsh they were later denounced as a "coup".
It taught me two things: that in the cause of its salvation the European Union can be profoundly flexible and exceptionally brutal, and that events can swiftly take a momentum that is hard to control.
Nothing of that experience gives me hope for the years that now await our country.
Britain is almost certainly out the European Union
As far as Brussels is concerned, Britain has left.
At home on Friday morning, Britons were dumbstruck, agog at the result, or chuffed at having taught Brussels a lesson.
We now see street protests to overturn the result, internet petitions, suggestions that the UK or Scottish Parliament could revoke it or somehow make it go away. Westminster is occupied by Labour coups and Tory successions. Few seem to believe we are going.
In Brussels, they have been ready to say goodbye for a long time. Britain had been half-way out the door for forty years. David Cameron had announced this referendum in January 2013. He had won an election on the back of it, and many expected him to lose it. He, and they, repeated many times that it was final and binding. Patience is exhausted.
On Friday there was grave sadness, but no panic. The timetable for the talks was announced days before the vote. Martin Schulz, the president of the Parliament, spoke at dawn; Donald Tusk, the president of the Council, delivered a statement at 07.40 GMT. The founding members' foreign ministers met on Saturday; sherpas for the 27 remaining states will meet today to sketch out the months ahead.
Leaders have demanded Article 50 is activated immediately, to create certainty. Realistically, Mr Cameron has until Christmas.
Scotland is ready to quit, and diplomats are quite open to welcoming them into the EU club.
The treaties say that all Britain’s rights and obligations must remain for two years once Article 50 is activated. But Lord Hill, Britain’s commissioner, quit yesterday, and Downing Street said it had no plans to replace him, and Jean-Claude Juncker told Ukip MEPs to pack their bags. Is the legal order fragmenting? What other clauses in the treaties - which protect British expats on the continent, among other things - will now be ignored without consequence?
Can it be halted?
The European Council has offered a narrow window, saying that Britain has not left until Article 50 is activated formally by the Prime Minister, “if it is indeed the intention of the British government.”
Mr Cameron has left it to his successor to activate it. Mrs Merkel is in no hurry. Senior EU sources say they can wait until Christmas, but prevarication would trash Britain's credit-worthiness.
There are two problems. Firstly, to not activate Article 50 would be a rejection of democracy on a scale that could only be described as a coup, and would poison British public life for generations.
Secondly, a wave of movements demanding referendums on the terms of membership, given a huge boost by Mr Cameron, is tearing across Europe – in France, Denmark, the Netherlands, Slovakia, Italy, Hungary. Marine Le Pen could well run rampant in French elections in the spring.
Leaders anticipated that Boris Johnson would pursue a 'vote leave for a better deal' strategy, and ruled it out from February, precisely to prevent this scenario.
Jean-Claude Juncker said on Friday: “The repercussions of the British referendum could quickly put a stop to such crass rabble-rousing, as it should soon become clear that the UK was better off inside the EU.” Britain simply has to go, on bad terms, pour encourager les autres.
Britain has very few friends
In European eyes, David Cameron has had a remarkably generous lot: already out the euro, ever closer union, justice and home affairs obligations and Schengen, he was offered an enhanced deal that confirmed the perks of membership with scant obligations.
Yet he attacked Brussels for years for domestic advantage. Mr Cameron campaigned hard against his appointment. Stories about Mr Juncker's alleged drinking and the war record of his father, a conscript in the Wehrmacht, emerged. Yet Juncker offered an olive branch by giving Jonathan Hill the financial services portfolio Mr Cameron craved, in order to preserve the City. He is profoundly angry.
In his brutal negotiation, Alexis Tsipras had a number of cards to play. There was the “solidarity” that EU states are obliged to show each other, the pity and guilt at the plight of the Greek people who had been punished through no fault of their own, and the €83 billion of German taxpayer cash in Greek banks that risked going up in smoke. Their referendum had been hasty, the question unclear, Mr Juncker said; Greeks made plain they wanted to remain Europeans.
No such goodwill exists for Britain, now an ex-member. Mr Johnson, the possible next prime minister, caused genuine and grave offence by likening the European project to the ambitions of Hitler. His declarations that Brexit will trigger events that unravel the entire project is, in effect, a declaration of war that must be met.
Recall how inflexible European leaders were during Mr Cameron’s attempted renegotiation, when he put a gun to their heads and threatened to leave unless they submitted to his demands. He has fired that gun in the air, and locked himself out the room. Britain’s only leverage is how much damage a messy Brexit would inflict on European economies.
Time is not on our side
Once Article 50 is activated, events will move frighteningly fast. It took Mr Cameron seven full months to secure his meagre renegotiation. He will have just two years to get an exit deal covering every facet of British life, and a trade deal that will do the least harm to the fragile, debt-laden economy.
The government is in disarray, the Labour party in meltdown, and the imminent exit of Scotland means it will be unclear with who or what, exactly, the EU is negotiating with. The French foreign minister yesterday implored Cameron to find a successor to take charge.
A ban issued from Downing Street on Brexit preparations – lest it boost the leave campaign – meant Britain’s most senior officials were permitted to “think” about a Brexit, but not allowed to write anything down.
Several take their guide from Flexcit, a book by a blogger Richard North that advocates a Norway-style deal as a half-way house under a “soft” exit. The crucial weeks ahead of polling day were spent in purdah, tending the garden.
The UK has next to no trade negotiators, and will need hundreds, to replicate the market access it currently has with 50 states around the world .
But the EU is ready. Talks in Jean-Claude Juncker’s in house think-tank began months ago. Foreign ministries have been preparing position papers. Lawyers are busy: Brussels has had 70 years of practice in writing treaties, signing trade talks, fixing accessions and bailouts, making and breaking nations.
We don't get to be Norway
The Leavers’ best hope – a Norway deal that means EEA status, retained rights for the City and immigration - is almost certainly off the table.
Britain has made clear it doesn’t want free movement – and so any deal on those grounds would be so impossibly fragile as to be a waste of time. Frankfurt and Paris would certainly like our banks. Mr Juncker is determined to undo Britain's attempt to create a multi-currency union, meaning clearing houses that trade in Euros and generate billions for the Exchequer will have to be domiciled in the Eurozone.
Leaders have made clear, before and after the vote, that Britain is not getting access to the single market.
“Out is out,” said Wolfgang Schaeuble, the German finance minister, some weeks ago.
“There will certainly be no cherry picking,” confirmed Mr Juncker, saying it will be a "clean" divorce.
More likely is a Canadian-style trade deal, that will set tariffs on imports and exports. That may be fine for German manufacturers. But Britain’s service economy will be cut up like an old car. British graduates are about to learn what it's like to use an Australian-style points system.
We do not control this process
Article 50 is designed so that it leaves any state that activates it is a supplicant.
The remaining EU states will negotiate between themselves and deal with the UK as one, just as they would for Albania or Turkey.
If a deal covering trade arrangements isn’t struck once the two-year period expires, Britain is simply released from the EU treaties and left on crippling WTO terms - something the Treasury terms a "severe shock scenario" and which it envisages would likely result in a cut in GDP of six per cent and increase unemployment by 800,000, not including the risks presented by emergency spending cuts, or the "tipping points" presented by the crystallisation of financial stability risks.
It means the government will effectively be forced to take any fait accompli presented at the last minute, or face ruin.
Even then, any further trade deal will require ratification by EU parliaments, meaning Belgian MPs, amongst others, can veto it.
The Leave campaign is fond of a quote attributed to Churchill: “Each time we have to choose between Europe and the open sea, we shall always choose the open sea.”
Oh, hear us when we cry to Thee, For those in peril on the sea.
Tuesday, 7 June 2016
The British Parliament can ignore a Brexit verdict
Michael White in The Guardian
The very thought of such defiance – here’s the BBC’s James Landale’s account – will have Brexiteers spluttering in their foreign coffee. How dare those MPs defy what will, they hope, be the sovereign will of the British people as expressed through the ballot box?
The short answer to that is simple: of course parliament can defy the referendum result, because the British constitution clearly states that “the crown in parliament” – ie a majority of elected MPs, subject to whatever the Lords tries to moderate – is sovereign.
Since Brexiteers claim to revere the ancient British constitution, and “sovereignty” is what it’s all about – not an excess of Polish plumbers or Bangladeshi restaurants – they can hardly complain about its correct and immaculate application.
There’s a second, telling point, which you will instantly remember when I point it out. Because parliament is sovereign, it can’t be bound, even by a referendum result. Legally speaking, the vote is only advisory.
So much for the legal situation by which many rigid minds think these matters are resolved. In the practical world of politics – politics is always more practical than theoretical – could it be done, if there was the political will among assorted parties to do so?
The short answer, again, is yes. Again the Brexiteers will cry outrage, but since they don’t have a coherent answer themselves it will be open to bold leaders to seize the initiative and sort things out the best way they can.
Remember, even the mud-splattered figure of Michael Gove admitted at the weekend that Britain would still be in the EU when the 2020 election takes place, and that withdrawal would be protracted and messy. Remember too that all sorts of awkward events would follow a Brexit vote.
Sterling would take a hit, so would inward investment and, probably, exports. The Bank of England is making plans. Foreign holders of UK assets – they hold a lot of cash and debt, lots of property of one kind or another – will look at the balance of payments on traded goods and levels of government debt and start moving on, as footloose foreigners do everywhere. They’re not here for the weather. Unions arerightly anxious.
So it would be stormy. “We would accept the mandate of the people to leave the EU,” says one unnamed minister, but everything else would be negotiable. Since they regard access to the EU single market as the most important component of the deal, that is what they would insist on. A majority of MPs from Labour, Lib Dem, Tories (not backbench Tories) and assorted nationalists, notably the 56-strong SNP contingent (suspended MPs included), could then insist on embracing the Norwegian model, one of the many mooted as the ideal relationship by the Brexit campaign.
Yes, I know, there are many others, including the World Trade Organisation’s (WTO) open market scenario. But that is unlikely to stand up to much exposure to the sunlight that would pour through every British window every day after a Brexit triumph – east and west facing windows at the same time, too.
So it would be up to David Cameron and his advisers to decide how best to proceed. Yes, I realise that amateur plotters in the Tory ranks are planning to unseat Cameron if he loses, and some of them if he wins – Matthew D’Ancona is urging Dave to get tough. Does he have it in him? Not sure, but here’s hoping.
This has been a damaging period for Tory unity and many nasty things have been said on both sides. But come the day a majority of MPs will realise that their more swivel-eyed colleagues are best left to their own devices while the humdrum reality of day-to-day real life and government is resumed. If Brexit wins there would be much to do, all day and every day, and a country to run as well.
Cameron would look the best man to do the job and it would be his duty not to slope off because it was his decision alone that dropped us into this referendum shambles, done for party tactical reasons. In normal times that would be enough to finish him off, but these are not normal.
Jeremy Corbyn regularly shows how unsuited he is for any heavy lifting – he’s getting the worst of both worlds by campaigning only feebly against Brexit – and neither Boris Trump nor Govey have emerged with much dignity from the campaign. I’d watch that Theresa May if I were you, Dave, but why wouldn’t she want Cameron to clean up his own dirty kitchen before taking over and giving it a makeover?
Tory papers like the Mail and Telegraph are outraged by the attacks made over the weekend by the likes of Sir John Major. Norman Tebbit – the Tory Tony Benn, disloyal to the point of treachery but not quite crossing the fellow travellers’ Ukip line – is fuming. It would be funny if it were not serious.
Back to the Maastricht rebellion, which so disfigured and weakened decent John Major’s years in office in the 90s when, like Cameron now, he only had a wafer-thin majority. Actually Major did pretty well at the treaty negotiations, his opt-outs kept us out of the euro among other things. Were the ingrates grateful? Of course not. As Ken Clarke once witheringly put it, they are middle-aged (now elderly) men who feel their lives have not been sufficiently exciting.
The Maastricht years were a shambles, good sport for reporters like me, but grim. Yet it is diehard Maastricht disloyalists like Tebbit, John “Vulcan” Redwood and dear but daft Bill Cash who are now crying loyalty; Iain Duncan Smith, who inherited Tebbit’s Chingford seat, too. No wonder Major was so scornful.
Not since Jeremy Corbyn, serial rebel in 500 votes, appealed for loyalty from old comrades to whom he had shown little has there been such cause for dry mirth. Ah, but Iain and Jeremy were doing what they believe in and what their constituents want, will come the retort. And you think that pro-remain MPs can’t say that too?
So the “reverse Maastricht” tactic is both legal and politically feasible. All it would take – the Norway model or any that looks better on the day – is leadership and willpower. Nicola Sturgeon would be a more slippery but also more reliable ally for Cameron (pause for ironic laughter) than Corbyn-led Labour.
But what about the free movement of EU labour in and out of the UK, which Norway’s deal would require us to embrace as part of the price for access? Correct, but for all its populist talk and tabloid extravagance about immigration, Brexiters have not cracked that one either. And they’ve still got to win. Two weeks to go.
Brexiteers claim to revere the ancient British constitution, and ‘sovereignty’ is what it’s all about. Photograph: Carl Court/Getty Images
What if the Brexit camp wins the referendum on 23 June, as some polls are currently scaring sterling by suggesting? Could pro-remain MPs do as one anonymous minister told the BBC and use their parliamentary majority in a “reverse Maastricht” to protect UK access to the EU single market as part of the withdrawal?
They would do so, according to today’s enjoyable speculation, because they have an overwhelming cross-party majority to do so – 454 to 147 mostly rightwing Tories, on some calculations – and because they will be able to claim Brexit has not put up a coherent policy for Britain’s trade relationship with Brussels. It has put up many options, but has no mandate for many of them.
What if the Brexit camp wins the referendum on 23 June, as some polls are currently scaring sterling by suggesting? Could pro-remain MPs do as one anonymous minister told the BBC and use their parliamentary majority in a “reverse Maastricht” to protect UK access to the EU single market as part of the withdrawal?
They would do so, according to today’s enjoyable speculation, because they have an overwhelming cross-party majority to do so – 454 to 147 mostly rightwing Tories, on some calculations – and because they will be able to claim Brexit has not put up a coherent policy for Britain’s trade relationship with Brussels. It has put up many options, but has no mandate for many of them.
The very thought of such defiance – here’s the BBC’s James Landale’s account – will have Brexiteers spluttering in their foreign coffee. How dare those MPs defy what will, they hope, be the sovereign will of the British people as expressed through the ballot box?
The short answer to that is simple: of course parliament can defy the referendum result, because the British constitution clearly states that “the crown in parliament” – ie a majority of elected MPs, subject to whatever the Lords tries to moderate – is sovereign.
Since Brexiteers claim to revere the ancient British constitution, and “sovereignty” is what it’s all about – not an excess of Polish plumbers or Bangladeshi restaurants – they can hardly complain about its correct and immaculate application.
There’s a second, telling point, which you will instantly remember when I point it out. Because parliament is sovereign, it can’t be bound, even by a referendum result. Legally speaking, the vote is only advisory.
So much for the legal situation by which many rigid minds think these matters are resolved. In the practical world of politics – politics is always more practical than theoretical – could it be done, if there was the political will among assorted parties to do so?
The short answer, again, is yes. Again the Brexiteers will cry outrage, but since they don’t have a coherent answer themselves it will be open to bold leaders to seize the initiative and sort things out the best way they can.
Remember, even the mud-splattered figure of Michael Gove admitted at the weekend that Britain would still be in the EU when the 2020 election takes place, and that withdrawal would be protracted and messy. Remember too that all sorts of awkward events would follow a Brexit vote.
Sterling would take a hit, so would inward investment and, probably, exports. The Bank of England is making plans. Foreign holders of UK assets – they hold a lot of cash and debt, lots of property of one kind or another – will look at the balance of payments on traded goods and levels of government debt and start moving on, as footloose foreigners do everywhere. They’re not here for the weather. Unions arerightly anxious.
So it would be stormy. “We would accept the mandate of the people to leave the EU,” says one unnamed minister, but everything else would be negotiable. Since they regard access to the EU single market as the most important component of the deal, that is what they would insist on. A majority of MPs from Labour, Lib Dem, Tories (not backbench Tories) and assorted nationalists, notably the 56-strong SNP contingent (suspended MPs included), could then insist on embracing the Norwegian model, one of the many mooted as the ideal relationship by the Brexit campaign.
Yes, I know, there are many others, including the World Trade Organisation’s (WTO) open market scenario. But that is unlikely to stand up to much exposure to the sunlight that would pour through every British window every day after a Brexit triumph – east and west facing windows at the same time, too.
So it would be up to David Cameron and his advisers to decide how best to proceed. Yes, I realise that amateur plotters in the Tory ranks are planning to unseat Cameron if he loses, and some of them if he wins – Matthew D’Ancona is urging Dave to get tough. Does he have it in him? Not sure, but here’s hoping.
This has been a damaging period for Tory unity and many nasty things have been said on both sides. But come the day a majority of MPs will realise that their more swivel-eyed colleagues are best left to their own devices while the humdrum reality of day-to-day real life and government is resumed. If Brexit wins there would be much to do, all day and every day, and a country to run as well.
Cameron would look the best man to do the job and it would be his duty not to slope off because it was his decision alone that dropped us into this referendum shambles, done for party tactical reasons. In normal times that would be enough to finish him off, but these are not normal.
Jeremy Corbyn regularly shows how unsuited he is for any heavy lifting – he’s getting the worst of both worlds by campaigning only feebly against Brexit – and neither Boris Trump nor Govey have emerged with much dignity from the campaign. I’d watch that Theresa May if I were you, Dave, but why wouldn’t she want Cameron to clean up his own dirty kitchen before taking over and giving it a makeover?
Tory papers like the Mail and Telegraph are outraged by the attacks made over the weekend by the likes of Sir John Major. Norman Tebbit – the Tory Tony Benn, disloyal to the point of treachery but not quite crossing the fellow travellers’ Ukip line – is fuming. It would be funny if it were not serious.
Back to the Maastricht rebellion, which so disfigured and weakened decent John Major’s years in office in the 90s when, like Cameron now, he only had a wafer-thin majority. Actually Major did pretty well at the treaty negotiations, his opt-outs kept us out of the euro among other things. Were the ingrates grateful? Of course not. As Ken Clarke once witheringly put it, they are middle-aged (now elderly) men who feel their lives have not been sufficiently exciting.
The Maastricht years were a shambles, good sport for reporters like me, but grim. Yet it is diehard Maastricht disloyalists like Tebbit, John “Vulcan” Redwood and dear but daft Bill Cash who are now crying loyalty; Iain Duncan Smith, who inherited Tebbit’s Chingford seat, too. No wonder Major was so scornful.
Not since Jeremy Corbyn, serial rebel in 500 votes, appealed for loyalty from old comrades to whom he had shown little has there been such cause for dry mirth. Ah, but Iain and Jeremy were doing what they believe in and what their constituents want, will come the retort. And you think that pro-remain MPs can’t say that too?
So the “reverse Maastricht” tactic is both legal and politically feasible. All it would take – the Norway model or any that looks better on the day – is leadership and willpower. Nicola Sturgeon would be a more slippery but also more reliable ally for Cameron (pause for ironic laughter) than Corbyn-led Labour.
But what about the free movement of EU labour in and out of the UK, which Norway’s deal would require us to embrace as part of the price for access? Correct, but for all its populist talk and tabloid extravagance about immigration, Brexiters have not cracked that one either. And they’ve still got to win. Two weeks to go.
Tuesday, 12 April 2016
Britain should deal with tax havens the way De Gaulle took on Monaco
Polly Toynbee in The Guardian
The prime minister has opened the floodgates, dragging the chancellor after him. Whatever David Cameron says, his example means all MPs will soon publish their tax returns: how dare any refuse? Feeding frenzies against politicians are not a pretty sight.
It’s a curious phenomenon that democracy is hailed as the highest human endeavour, yet its practitioners are always held in public contempt. “Elites” everywhere are in the pillory, but none more than the “elite” we elect and then despise.
Why single out politicians? The Times quotes a Conservative MP saying this will inevitably extend to “all those in public life” asking, “Where does it stop? BBC journalists, councillors, judges?” Indeed, there is no clear line between public and private people. Donors to political parties, journalists certainly, anyone in public office or with a public contract – and their partners too. There is no stopping these dominoes. Cameron in the Commons said he was against public officials having to publish tax returns, but he has broken the secrecy spell, and transparency always leads to demands for more.
Money is not a private matter. It may be almost as exciting as sex but exposing private wealth is not like publishing rude photos from private bedrooms. Who has what and from where is public because everyone must pay tax on it, even if a depleted HMRC can scrutinise very little. On death, light shines in as wills are published, but real transparency would make everyone’s tax return a public document.
The social shock would be seismic. At first people would feel as naked as if their clothes were stripped off in front of neighbours and work colleagues. Why else was Cameron so shy about revealing the scale of his wealth? He had done nothing unusual for families of his kind: it was the graphic exposure of his hundreds of thousands that made him blush. Why? Because people with inherited money know it’s not fair, they didn’t earn it and they are just lucky winners in life’s lottery.
The Daily Mail delivered a mighty full-page blast of anger against any questioning of Osborne’s £1m inheritance tax gift, which will cost the exchequer £5.8bn. Misleading as ever, they write of “most people”, and Downing Street talks of “millions of ordinary people” doing “proper tax planning” for inheritance. Yet as it is, only the super-rich pay inheritance tax, just one in 20 estates. Forget the seven-year rule, abolish this tax and instead tax recipients for all gifts they receive above a threshold over their lifetime.
The Mail warns that all this embarrassing exposure means “people with private means will no longer wish to go into public life, putting their advantages at the service of the less fortunate”. But that’s just it, these leaders with private means have harried the “less fortunate” mercilessly. They inflict billions of cuts on the poorest – in bedroom tax, benefit cap, child benefit freeze, two-child limit, and ruthless disability fit-for-work tests – while sanctions drive many into food bank destitution. The “less fortunate” may not be grateful to those with private means who rule over them. No wonder Cameron blanches at revealing his all.
Sheltering wealth, the right calls any protest against inequality “the politics of envy”. Most families still haven’t regained their pre-financial crash incomes, yet anyone with high-value property watches their assets inflate into the stratosphere. When unearned income such as Cameron’s soars but wages lag behind, anger at untaxed riches is inevitable.
Polls show people make a sharp distinction between genuine “wealth creators”, such as self-made entrepreneurs or superstars, and the trustafarians and rent-seekers who are enriched for no discernible merit. Resentment is often channelled into cynicism and sour trolling, not into political action. Will this start to change?
In Scandinavian countries, total tax transparency has helped create societies far more equal than ours. At the click of a mouse in Norway, people can find out what others own and earn, and everyone knows where they stand. Transparency stops women being paid less than men. Transparency makes employers more likely to pay themselves and their staff fairly. The culture of openness breathes an implicit belief in social justice.
But here, research from the London School of Economics’ professor John Hills shows how clueless most people are about the earnings of others, wildly underestimating British inequality. Both rich and poor delude themselves that they are far nearer the middle than they are. They know people who are better off and worse off, wrongly concluding themselves to be middling.
In my book Hard Work, I ran focus groups of the super-rich who refused to believe how much richer they were than the rest. Those with yachts envy those with a yacht and a crew, so they never feel truly rich. With the decline of unions, pay secrecy allows employers to divide and rule in the dark.
The disinfectant of sunlight makes shifty dealings and criminality much less likely, so it’s time for us to turn Norwegian. Don’t let’s strip public figures naked one by one, but let’s open the window and have every citizen’s tax return exposed. Tax works when everyone knows everyone else pays it too: I-will-if-you-will transparency is the same, all jumping in with one big splash, everyone’s income and wealth revealed together.
But don’t let gossipy obsession with personal wealth and inheritance distract from the main issue revealed in the Panama Papers. The prime task is to sweep away secrecy that allows our flotilla of tax havens to hide the world’s wealth from taxmen.
Cameron announces new rules obliging havens to answer HMRC requests for information on the beneficial owner of a company within an hour. But that’s bogus transparency, depending on occasional official requests. Tax experts say all beneficial ownership must be published openly so any investigator can check who owns what any time.
In the same way, all dealings between HMRC and companies must be published, so we can see how Google, Amazon, Facebook and myriad others escape paying what they owe. After deep cuts, HMRC needs assistance from the prying eyes of journalists, the public, company competitors and anyone who might investigate mega-avoiders.
Today Cameron’s promise fell far short of that genuine transparency. He needs to get tough with the treasure islands and follow Charles de Gaulle’s example. When Monaco refused a tax measure he requested, he forced them to surrender by surrounding the kingdom with soldiers and turning off their water supply.
The prime minister has opened the floodgates, dragging the chancellor after him. Whatever David Cameron says, his example means all MPs will soon publish their tax returns: how dare any refuse? Feeding frenzies against politicians are not a pretty sight.
It’s a curious phenomenon that democracy is hailed as the highest human endeavour, yet its practitioners are always held in public contempt. “Elites” everywhere are in the pillory, but none more than the “elite” we elect and then despise.
Why single out politicians? The Times quotes a Conservative MP saying this will inevitably extend to “all those in public life” asking, “Where does it stop? BBC journalists, councillors, judges?” Indeed, there is no clear line between public and private people. Donors to political parties, journalists certainly, anyone in public office or with a public contract – and their partners too. There is no stopping these dominoes. Cameron in the Commons said he was against public officials having to publish tax returns, but he has broken the secrecy spell, and transparency always leads to demands for more.
Money is not a private matter. It may be almost as exciting as sex but exposing private wealth is not like publishing rude photos from private bedrooms. Who has what and from where is public because everyone must pay tax on it, even if a depleted HMRC can scrutinise very little. On death, light shines in as wills are published, but real transparency would make everyone’s tax return a public document.
The social shock would be seismic. At first people would feel as naked as if their clothes were stripped off in front of neighbours and work colleagues. Why else was Cameron so shy about revealing the scale of his wealth? He had done nothing unusual for families of his kind: it was the graphic exposure of his hundreds of thousands that made him blush. Why? Because people with inherited money know it’s not fair, they didn’t earn it and they are just lucky winners in life’s lottery.
The Daily Mail delivered a mighty full-page blast of anger against any questioning of Osborne’s £1m inheritance tax gift, which will cost the exchequer £5.8bn. Misleading as ever, they write of “most people”, and Downing Street talks of “millions of ordinary people” doing “proper tax planning” for inheritance. Yet as it is, only the super-rich pay inheritance tax, just one in 20 estates. Forget the seven-year rule, abolish this tax and instead tax recipients for all gifts they receive above a threshold over their lifetime.
The Mail warns that all this embarrassing exposure means “people with private means will no longer wish to go into public life, putting their advantages at the service of the less fortunate”. But that’s just it, these leaders with private means have harried the “less fortunate” mercilessly. They inflict billions of cuts on the poorest – in bedroom tax, benefit cap, child benefit freeze, two-child limit, and ruthless disability fit-for-work tests – while sanctions drive many into food bank destitution. The “less fortunate” may not be grateful to those with private means who rule over them. No wonder Cameron blanches at revealing his all.
Sheltering wealth, the right calls any protest against inequality “the politics of envy”. Most families still haven’t regained their pre-financial crash incomes, yet anyone with high-value property watches their assets inflate into the stratosphere. When unearned income such as Cameron’s soars but wages lag behind, anger at untaxed riches is inevitable.
Polls show people make a sharp distinction between genuine “wealth creators”, such as self-made entrepreneurs or superstars, and the trustafarians and rent-seekers who are enriched for no discernible merit. Resentment is often channelled into cynicism and sour trolling, not into political action. Will this start to change?
In Scandinavian countries, total tax transparency has helped create societies far more equal than ours. At the click of a mouse in Norway, people can find out what others own and earn, and everyone knows where they stand. Transparency stops women being paid less than men. Transparency makes employers more likely to pay themselves and their staff fairly. The culture of openness breathes an implicit belief in social justice.
But here, research from the London School of Economics’ professor John Hills shows how clueless most people are about the earnings of others, wildly underestimating British inequality. Both rich and poor delude themselves that they are far nearer the middle than they are. They know people who are better off and worse off, wrongly concluding themselves to be middling.
In my book Hard Work, I ran focus groups of the super-rich who refused to believe how much richer they were than the rest. Those with yachts envy those with a yacht and a crew, so they never feel truly rich. With the decline of unions, pay secrecy allows employers to divide and rule in the dark.
The disinfectant of sunlight makes shifty dealings and criminality much less likely, so it’s time for us to turn Norwegian. Don’t let’s strip public figures naked one by one, but let’s open the window and have every citizen’s tax return exposed. Tax works when everyone knows everyone else pays it too: I-will-if-you-will transparency is the same, all jumping in with one big splash, everyone’s income and wealth revealed together.
But don’t let gossipy obsession with personal wealth and inheritance distract from the main issue revealed in the Panama Papers. The prime task is to sweep away secrecy that allows our flotilla of tax havens to hide the world’s wealth from taxmen.
Cameron announces new rules obliging havens to answer HMRC requests for information on the beneficial owner of a company within an hour. But that’s bogus transparency, depending on occasional official requests. Tax experts say all beneficial ownership must be published openly so any investigator can check who owns what any time.
In the same way, all dealings between HMRC and companies must be published, so we can see how Google, Amazon, Facebook and myriad others escape paying what they owe. After deep cuts, HMRC needs assistance from the prying eyes of journalists, the public, company competitors and anyone who might investigate mega-avoiders.
Today Cameron’s promise fell far short of that genuine transparency. He needs to get tough with the treasure islands and follow Charles de Gaulle’s example. When Monaco refused a tax measure he requested, he forced them to surrender by surrounding the kingdom with soldiers and turning off their water supply.
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