On Tuesday Brexit turned three. I started this blog roughly a year after when the transition period had just finished. The idea was about truth telling. The Brexit referendum campaign had left a deep and troubling impression on me. I remember watching one of the televised debates and staring at the telly in shock and disbelief when it dawned on me that the Leave side actually had no idea what Brexit would look like and how the country would leave the EU were they to win. There were some vague references to Norway and Switzerland; but clearly no plan and no clue about what Brexit would actually mean. The worst, however, was the endless stream of lies coming out of the Leave campaign, that right-wing newspapers eagerly help spread. This blog was meant to somehow contribute – however little – to the task of making sure that those who told the lies would not get away unchallenged once Brexit actually happened. I wanted to document the damage the whole project was inevitably going to do to the country and thus to provide a factual basis to restore some truthfulness in British politics.
I do not think I expected the task of documenting the Brexit damage to be so easy. That is to say, it is not easy at all to keep track of all the things that Brexit has broken and all the ways it has affected the British economy, politics, and society. It is a proper mess. Nor is it easy to remain as objective as possible and not to attribute everything that is not going well in the country to that single cause. What is easier than I thought it would be, however, is to assess whether on the whole Brexit has been good or bad for the country.
Lies on repeat
The third Brexit anniversary this week made it very clear that Brexit has delivered no benefits for the country in the past three years that would outweigh the massive costs of having left the EU. The easiest way to prove that statement is to look at what the people in government had to say about it. The Prime Minister – a Brexiter himself – tweeted the following list of things he thinks the Tories have done to ‘harness’ the new found ‘Brexit freedoms’: The fastest vaccine rollout, striking trade deals with over 70 countries, taking back control of our borders, cutting red tape for businesses, levelling up through our freeports, and designing our own, fairer farming system. Home Secretary Braverman tweeted a quite similar list only adding the ‘points based immigration system’ and concocting ‘[r]egulatory freedoms worth over £100bn in the REUL Bill and Edinburgh Reforms.’
Every single item in these lists of alleged Brexit benefits – except perhaps the agricultural policy – are a-hundred-times-debunked falsehoods. The UK’s vaccine rollout was somewhat faster than the EU’s. Yet, that had nothing to do with EU membership, but rather, with the fact that the EU exported part of its domestic production to help other countries, while the UK kept all for its domestic use. All but three of the 70+ trade deals signed after Brexit were rolled-over EU trade deals. Those that were not are even according to the people who negotiated them bad for the UK (the ones with Australia and New Zealand), or have actually made trade more difficult not easier (the Trade and Cooperation Agreement with the EU itself). Net migration is at an all-time high and the Tories themselves are the ones complaining about the small migrant boats arriving across the English Channel, while businesses are reeling under labour shortages as well as increased red tape. Finally, establishing freeports is allowed under EU law, and economically they are at best meaningless, at worst damaging to UK’s regional economies. With or without freeports, levelling up is simply not happening among other things because lost EU funds are not being matched by the new UK funding system.
So, if this is the best leading Brexiters have to show three years after Brexit, I think it is fair to say the matter of whether Brexit has been a success or an abject failure is well and truly settled. The British public seems to increasingly agree. A new striking poll carried out by Unheard found that there is now only one single constituency in the whole country where a (slim) majority still thinks Brexit was the right thing to do.
Why is Brexit failing?
How to explain the abject failure of Brexit? One explanation is that the whole project was a delusion and promised things that it could never achieve, because they are simply unachievable fantasies. That is because the basic premise driving much of Brexit is that it is possible to have your cake and eat it: That you can exit the EU, but the EU would still grant you unhampered access to the single market while letting you set unilaterally your own rules, regulations, and standards. That you can stop Europeans from settling and working in the UK, while still being allowed to buy a house and retire in the EU without any questions asked. In short, that our country can have everything it wants without conceding anything in return. There may be a universe where that is possible, but sadly it is not the one we live in! So, Brexit’s failure was baked into the ‘cakist’ nature of the project itself.
But in another sense, it did not have to be quite this disastrous. I remain firmly convinced that exiting the EU is a legitimate choice for any member state to make (if the decision is taken in a legitimate way) and that it can be done in a less damaging fashion then the exit the UK chose. That is not to say that it would be better for businesses and people than being a member, but it could be done with less damage than the UK’s Brexit. Such an exit, however, would have to be carefully planned and happen in a gradual way not in a rush without any plan. That was never going to happen in the case of Brexit, because it was the project of the most delusional and ideologically blinded fringe of the British political elite.
None illustrates that point better than David Frost. Indeed, it is one of the most painful results of Brexit, that the whiskey merchant turned political philosopher has become a public figure. His interview with Emily Maitlis on the News Agents podcast constituted a fascinating microcosm of the contraptions Brexiters now have to resort to to find any justification of their project. His account of how we ended up in this mess went something like this: Brexit was a great idea, but then Theresa May proposed a bad deal. David with his pal Boris came to the rescue and managed to wrestle an improved deal from the EU. Unfortunately, the Remainer Parliament put obstacles in their way (in the form of the Benn Act), which limited the greatness of the deal Boris and David could get. Still the deal was good, but then the EU triggered article 16 of the Northern Ireland Protocol (NIP) to stop vaccines from leaving the EU (Maitlis had to correct him that the EU did not actually trigger Art 16 only suggested it might do). That created the problems in Northern Ireland and hence the NIP needs to go. So, according to Frost, how do we get out of this mess? Simple: Vote Tory in the next General Election so that they are given the chance to do Brexit better in the next Parliament. But beware, it will of course take another ten years before any benefits can be felt!
That is quite an extraordinary narrative aimed at shirking any responsibility and clinging on to the one big lie that made his political career possible.
The most extraordinary moment in the interview, however, was when, in his desperation, Frost attempted to bat off Maitlis’s question about labour shortages following the end of free movement of people by bragging about the record level of net immigration. This of course is pretty much the polar opposite of what his party has promised their voters for years and years. I guess I should not be surprised anymore when Brexiters attempt to excuse one of Brexit’s broken promises (no negative impact on the labour market) using another one (cutting net migration). In fact, it could almost be amusing, and I might feel some satisfaction hearing the absurdities Brexiters have to resort to in their desperate attempts to try and defend their record.
Unfortunately, the damage Brexit is doing to both the UK economy and its political system leaves no room for Schadenfreude, but only for concern and worry.
Indeed, the damage is so pervasive and multifarious that one could start a new discipline, that of ‘Brexit damageology.’ Chris Grey in his blog post last week has provided a useful distinction between different types of damages Brexit is doing to the UK. The direct and central damage of Brexit is Brexit itself, i.e. all the disadvantages UK companies and people are now facing because of their non-membership in the EU. However, there are equally bad types of more indirect damage. The first one of them is that it has become perfectly normal in British politics to deny the ‘complexities and realities of international interdependence.’ Secondly, what Chris Grey calls the ‘most toxic twist’ is turning the defence of reality against fantasy into an act of treason.
These three types of damage rely on a web of lies that make it hard to see how the country can untangle it without suffering major additional damage. Indeed, Jonathan Lis, writing in the Byline Times, considers Brexit ‘a lie so etched on the body politic that to expose it will somehow take the entire establishment down too.’ I think it could be worse still, namely that the Brexit damage not only breaks the UK economy and politics, but also its society.
Three years of Brexit: The economy at breaking point
On the economic front, the past fortnight has added further evidence of the damage Brexit has done over the past three years. There was the news about British Volt going out of business after all, there was the news that the Chancellor had to bail out the Steel Industry (with money that the state allegedly does not have), then there was the story about UK car production having fallen to its lowest level since 1956. Brexiters, no doubt, will say all this is the result of the war in Ukraine, the Covid19 pandemic, or ‘global supply chain problems.’ Yet, while the Ukraine war and Covid19 are of course global problems, Brexit is not. In that context, it is striking that the International Monetary Fund (IMF) expects the UK to be the only G7 economy to shrink in 2023. Therefore, one may be forgiven to increasingly succumb to the mortal sin of ‘British declinism.’
Brexiters, of course, immediately dismissed the IMF forecast, shouting of the top of their virtual lungs that the experts at the IMF always get their forecasts wrong. To some extent that is true. Forecasts are notoriously difficult to make and the IMF economists – just like any economist – regularly get them ‘wrong’ (if a discrepancy between forecast and reality can actually be considered to be a ‘mistake’ rather than just something that is in the nature of forecasting). What Brexiters of course do not tell you is that there is no bias against the UK In IMF forecasting. So, on average, they do not get Britain’s forecasts more wrong than they do other countries’. The interesting thing about the most recent forecast then is simply that the UK’s prospects are so clearly worse than comparable countries.
Hunt’s anti-declinism
Chancellor of the Exchequer Jeremy Hunt will not have any of this pessimism though. In a speech on Friday a week ago he stroke back against the ‘declinist narrative’ and sought to demonstrate that Brexit has made possible his glorious ‘four Es’ plan for the UK economy (the four Es mentioned in the speech standing for ‘enterprise,’ ‘education,’ ‘employment,’ and ‘everywhere’ i.e. ‘levelling up’).
Arguably, the reasons why he is defending Brexit at a time when the numbers of believers in the project in the general public are dwindling, has to do with internal Tory politics. As the Financial Times’s Stephen Bush writes, talking up Brexit may be part of an appeasement strategy targeted at the Tory right-wing ahead of the March budget, which will contain few tax cuts and possibly more government spending.
I am sure, with his speech, Hunt will have convinced the Brexiters in the ERG and in his Party that Brexit is great. I doubt he has convinced anyone else. Indeed, business groups hit back shortly after the speech. The director general of the British Chambers of Commerce, was quoted as saying that the Chancellor completely omitted two crucial additional Es: namely fixing energy and exports without which there will be no growth. Kitty Usher from the Institute of Directors more bluntly said to Hunt’s ‘four Es’ a fifth should be added: E for ‘empty’. Indeed, other than aspirational talk about Britain becoming the world’s Silicon Valley and the usual promises that this could be achieved purely by way of deregulation, the speech largely remained in the realm of fantasy and slogans without providing any coherent policy plan of how to achieve those aspirations.
Quite tellingly, the only positive voice the FT cites is Tim Pitt – former advisor to chancellors Hammond and Javid – who found the speech provided a “refreshing balance of realism and optimism”, “identifying areas [of] policy [that] can make a difference.” However, identifying the areas where Brexit can make a differences has been long done. Jill Rutter from the Institute of Government for instance wrote in the FT a couple of weeks ago that the five areas of digital technology, life sciences, green industries, financial services and advanced manufacturing were areas where divergence from EU rules may provide growth potential. But of course, the trick is not so much to identify these areas, but to actually develop the policy plans needed to turn the promises into reality. In that department, when it comes to move from slogan to policy, Brexiters and our government seem completely out of their depths.
No plan Brexit
The emptiness of Hunt’s economic strategy reveals the bankruptcy of the kind of economic thinking that underlies Brexiter thinking – both the libertarian kind of Truss and the IEA and that of the orthodoxy represented by Hunt. This was illustrated by the inability of the government to come up with any response to the US’s new industrial policy and the EU’s reaction to it. Industrial policy is something that is inherently incompatible with libertarian and orthodox economic policy and therefore something the Tory government cannot easily come to terms with. This became crystal clear when the then secretary of state for industry Kwasi Kwarteng decided to ditch it two years ago.
The impact of the plan- and cluelessness of the government regarding industrial strategy could be observed by developments in the steel sector last week. While the government has no industrial strategy, the state does intervene sporadically in the economy when it seems politically appropriate. Last week the Chancellor announced that Indian-owned Tata Steel and Chinese-owned British Steel would receive around £600m of state support to not close down plants in Scunthorpe Lincolnshire and Port Talbot, South Wales and instead invest in greener technology. This may sound like sensible industrial policy given that the two companies taken together employ 7,500 workers.
However, it is also the perfect illustration of how the Tory party’s self-imposed ideological ‘no-nos’ prevent it from adopting reasonable long-term strategies and instead forcing it to resort firefighting when things are too broken.
Indeed, the struggles of both British and Tata steel were predictable and indeed predicted by actors in the steel sector. Yet, the government never seriously addressed the issues facing the steel industry. It did not provide anywhere near sufficient state aid to help the transition to more sustainable steel production; neither did it take industry complaints about the uncompetitive level of electricity prices seriously. A parliamentary briefing found that for the first half of 2020 UK steel industry paid 84% above the median price in the EU. That is remarkable, because we have been told that the only problem standing in the way of the UK having a ‘world-leading’ Steel Industry were EU restrictions on state aid and the inability to set our own trade strategy. Yet, all the UK government has managed to do since Brexit is insufficient and contradictory actions on steel tariffs, energy prices, and state support so that investors were put off by the uncertainty.
For instance, in 2016 the EU put 19 trade remedies in place to protect European steel from Chinese dumping. When the UK exited the EU, the Trade Remedies Authority (TRA) recommended to then Trade Secretary Liz Truss that nine of the 19 should expire on June 30, 2021. Unsurprisingly, UK steel producers strongly objected to that decision. Ultimately, International Trade Secretary Anne-Marie Trevelyan announced in June 2022 that all 19 protections would remain in place. By that point, however, years of regulatory uncertainty had already affected investment in the sector.
So, given the uncertainty and without sufficient action on other issues – such as energy costs – the trade remedies ultimately proved ineffectual. Worse still, they have led the Indian government to retaliate with tariffs of its own on British steel, which constitute a further obstacle to reaching a Free Trade Agreement (FTA). Such an FTA with India has already been compromised by Trade Secretary Badenoch’s statement a few weeks ago that more visas for Indian students could not be part of the FTA, since ‘we left the EU because we did not believe in free movement of people.’
In the area of steel, as well as immigration, then, Brexiters continue to privilege their ideological red lines over solving real world issues that actually would make a difference to the country. Brexit is not the root cause of this ineptitude, rather just like the inchoate economic policy, it is a symptom of the gradual takeover of the conservative party by ever more radical and extremist ideologies. This has led to a governing elite of egocrats whose economic and political abilities are extremely limited and whose lodestar is self-interest.
Scandals and failures: Breaking society
The most nefarious political damage Brexit is doing to the UK is that running the Tory party, with its front benches stuffed with self-serving egocrats, is only possible by disregarding any previous standards of decency and integrity in public life.
The list of scandals and investigations involving the most senior Tories continues to grow literally every week. PM Sunak, who took over the party leadership on a promise to bring back integrity after three abysmal years for standards in public life, clearly is unable to uphold his declared ‘values’ of integrity against the rot in his party. That is not surprising of course, given that he himself is part of the rot. Thus, he is the one who reappointed Suella Braverman just a week after she had to step down from the Cabinet due to breach of the ministerial code. At the time, that move seemed like the action of a weak PM, desperate for any support from within the party he could get. But the PM’s handling of Nadim Zahawi’s tax affair put a whole new complexion on that move.
Certain elements of Zahawi’s tax affairs had been publicly known since last summer. Yet, the affair blew up in full after Christmas. It has since been revealed that the Chairman of the Tory party failed to declare the fact that he was under investigation by the HMRC when he was appointed Chancellor of the Exchequer and probably also lied to Sunak. After days of toing and froing and a short investigation, Sunak ultimately had to sack the Chancellor. Zahawi himself of course shows no remorse for defrauding the Treasury – which he then went on to lead – to the tune of several million pounds. Rather, he used his resignation letter to attack the media’s role in making sure he was found out and held to account.
For Sunak the Zahawi affair is bad news. As Adam Bienkov astutely observes, the fact that Sunak cites the breach of ministerial code as the reason to sack Zahawi, while he was happy to reappoint Suella Braverman days after she was sacked for a breach of the ministerial code by his predecessor Liz Truss, makes him look opportunistic and weak, not decisive and having integrity.
In a normal situation, the Zahawi affair would probably keep the media and public sphere busy for several months. Not in Brexit Britain. This case is just one among a long list of scandals, which make it difficult to concentrate on one single one for very long. Indeed, in parallel to the Zahawi case, another scandal broke, which involves former PM Johnson who may have given the Chairmanship of the BBC to someone who helped him get a £800,000 loan from a Canadian businessman.
These two scoops almost made one forget about the ongoing investigation into bullying allegations against Deputy PM and Justice Secretary Dominic Raab. Worse still, the media coverage there is from the right-wing press spins the Raab investigation into a tale of a supposedly left-wing Remainer civil service conspiring against an elected pro-Brexit politician. This is probably an attempt to deflect from the fact that the PM himself is under increasing pressure to clarify whether he knew about bullying allegations against Raab when he reappointed him as justice secretary.
Zahawi, Johnson, and Raab are only three examples of a type of highly corrupt and unserious egocrats who were carried to power by the Brexit wave. So, the scandals they are involved in presumably is only the type of the iceberg.
The list of scandals and failure to uphold high standards in public office since 2016 is shockingly long. It is hard to underestimate the damage this is doing to the UK’s political system and society. The problem is not so much one of people losing trust in politicians. As a Hansard Society report found after the expenses scandal of 2009, trust in politicians was already so low back then that the scandal could not cause a much further decline. Yet, that does not mean such scandals are unproblematic. The signal our governing party is sending to the nation for at least the past seven years is not only that ‘greed is good,’ nastiness acceptable, and private interest above the public good, but also that anything goes in terms of moral standards and social norms. The News Agents recalled that John Profumo ended up cleaning toilets in East London after having fallen from grace due to an extramarital affair. Johnson, Patel, Braverman, Raab, and possibly Zahawi too, in contrast, briefly resign from their positions but re-enter the political arena almost immediately and have a good chance of occupying a high office of the state again even without ever really acknowledging their faults let alone apologising. It does not take much to imagine how this sort of behaviour at the top of British society will affect the attitudes of ‘normal’ citizens towards issues of honesty, integrity, and public service. Britain risk becoming one of the most cynical nations in the world.
Three years of Brexit have broken the British economy and British politics. If Brexiters remain in power for much longer, it will also break British society.