Brexit discussion thread II

solodeogloria · 27-08-2017 09:29PM

First Up wrote: »

Slow decay and decline is certain but how it plays out politically and socially is guesswork.

UK industry will suffer and jobs will be lost. Living costs will rise but property will probably be cheaper as the market depresses and sterling falls. That will suit the Arabs and Russians but won't do much for the locals.

The nonsense about new trade deals will be exposed quickly enough but that's over the head of your average joe.

The most likely early developments will be political as I don't see either the Tories or Labour coming through intact. The Brexiteers won't be happy when the negotiators come back with their heads under their arms and the Labour left will have to be seen to respond to the impact on the working man (who will be working less.)

We'll see new party leaders emerge; I just hope some of them aren't populist opportunists. The UK is desperately short of people up to the job but it sort of serves them right; you got the politicians you elect - and deserve.

Good evening!

I genuinely don't understand how you can get to this kind of apocalyptic vision from where we are now.

It is in nobody's interests not to conclude some form of a deal.

Much thanks,
solodeogloria

steddyeddy · 27-08-2017 09:34PM

solodeogloria wrote: »

Good evening!

Last post for today. I agree to a degree but only a degree. Proximity is important but it's less important in the world now as it was decades ago.

Britain's trade with the wider world has been increasing. As far as single countries go America is huge. Here's what the Office of National Statistics think:

It's a bit of proximity and large economies. With 56% of trade outside the EU I think the UK needs a model to allow it to better grow trade with those economies. Also proximity matters more with physical goods but not so much with services.

It also depends on the company. For example JCB do much more trade outside the EU. So much so the company owner was pro-Brexit. There are other companies that are hugely dependent on EU trade.

We need to hammer out a solution that addresses both. This is a no brainer to me.

Much thanks,
solodeogloria

It's a no brainer alright. Your link reminds us of the fact trade is most important with neighbouring countries and you choose to discount that. You think reducing trade with neighbouring countries (EU) will lead to increased posperity for the UK. I find it very hard to accept you believe what you posted.

steddyeddy · 27-08-2017 09:40PM

David Davis has a new tactic. He's going to demand more flexibility in the negotiations. All this while the leaders of EU27 decide whether to allow trade talks to proceed. That's control ladies and gentlemen.

http://home.bt.com/news/uk-news/david-davis-to-demand-more-flexibility-from-brussels-in-brexit-negotiations-11364207334116

murphaph · 27-08-2017 09:41PM

solodeogloria wrote: »

I genuinely don't understand how you can get to this kind of apocalyptic vision from where we are now

The Punt would be worth £1.17 today. Does that not ring any alarm bells at all??

Jaggo · 27-08-2017 09:50PM

jm08 wrote: »

Iceland has something that China wants - seafood. Otherwise, China has little competition from Iceland and so it suits them as well.

You need to look at what China imports to see how easy a FTA will be. The main thing I think they need is food, and the UK isn't a big food exporter. Scottish Whiskey & Salmon might be in demand as well and possibly education (but the UK is blowing that one as all the academics are leaving the UK). Tourism would be big (so easy entry visas!).

This is true, but one thing else, Iceland had a strong negotiating position as it is one of the countries on the Arctic Council. The Council is dealing with shipping through the arctic sea and Iceland is one of 8 countries on it. As part of China's FTA with Iceland, Iceland agreed to grant China observer status to the negotiations.
http://www.dw.com/en/china-iceland-sign-strategic-free-trade-agreement/a-16745190
http://www.telegraph.co.uk/finance/economics/9995525/Iceland-first-European-country-to-sign-free-trade-agreement-with-China.html

Even with this strong position, (they could offer china something no one else could) Iceland only got to sell Fish to china and China got to sell everything else to Iceland.
Note, Iceland's second largest export, financial services didn't get a look in. All financial companies in china are owned by chinese, there is nothing in this FTA that can give Brexiters any hope.

Lemming · 27-08-2017 09:51PM

Nody wrote: »

I can see where you're coming from but I'll play you a slightly different scenario which I think is more likely.

Hard brexit happens in some form, trade deal with EU will be negotiated after with a spin on how it's all EU's fault really.

...

In short I don't see a social chaos erupting as much as a slow decay of living standards, food standards etc. The working and middle class will not rise in uproar but will be lead around the nose by the press with faux uproars about this or that to distract them from the morass that UK is finding themselves in. I'd predict it taking at least 4 or 5 elections before a major (i.e. top two) party would even suggest considering rejoining EU again and that party is unlikely to win while the press runs a long campaign of "how bad it is in EU" during the election cycle while during these years those who can and have the will are actively leaving the country for greener pastures delivering a significant brain drain on the economy and people who works as firebrands to change things around. To stop the people feeling and economy from feeling to much pain the government will constantly increase their borrowing until the point IMF will have to get involved. Think Argentina more than Venezuela basically.

Apologies for the quote tennis. I don't disagree with anything you wrote and I agree with it save to elaborate on the chaos elements. I'm in agreement with First Up that economically it'll be a slow decay, but politically it'll be an absolute trainwreck in slow-motion with a rail car full of fireworks for good measure. The paralysis of government would hasten the social chaos I mentioned as local services in turn become paralysed due to nobody being able to make decisions or eventually sign off on budgets from higher up. I don't talk literally of the middle classes engaging in riots, but it wont take long from the point of mass unemployment to seeing what social services remain decay further to create tinder box flash-points (think 1980s South Yorkshire miners strikes or the riots across England around 2013) in which a lot of pent up frustration & anger boils over and police forces that would at that point have been mercilessly tortured with ever declining funding & resources struggle to contain - which would quite possibly lead to the army being deployed to assist in such a context on mainland soil. Remember that the UK has a large working class population, many of whom will not have seen much of an improvement in living standards for a decade already.

Edit: as for the "it's all the EU's fault"; it'd be funny if it weren't so seriously tragic. Playing to the home gallery is of zero benefit because it's not the home gallery that needs convinced. Indeed much of that playing is alienating the people that really do need convinced.

LeinsterDub · 27-08-2017 10:08PM

Zubeneschamali wrote: »

But "take back control" was not what the referendum asked:

"Should the United Kingdom remain a member of the European Union or leave the European Union?"

There was nothing in there about control, the single market or customs union, just two options:

Remain a member of the European Union
Leave the European Union

The Tories are not choosing Hard Brexit because they have to, they are doing it because it kills the threat from UKIP and the Eurosceptic wing of the Tory Party to the leadership.

I'm aware of that options were presented to the British public. What you are doing is ignoring the reason a lot certain sector of the British public voted for brexit.

Capt'n Midnight · 27-08-2017 10:27PM

First Up wrote: »

I'm not pinning any hopes on Corbyn or Labour. I don't think there is anything much to be hopeful about. But there is almost certainly going to be chaos and who knows how that will end up.

There's been too much backstabbing for the current bunch of Tories to yield power before the next election.

Which means Labour can say anything they damn well please because it means squat.

Even if you pretend that they will get into power before the deadline and get rid of the hard left and somehow get a deal or extension they have already committed to Brexit.

Yes they said Customs Union, but how would they get that deal ? How would they keep the seizable chunk of their voters who voted to exit happy ?

Another circle to be squared.

Unless there is a sea change in public opinion.

jm08 · 27-08-2017 10:33PM

Jaggo wrote: »

This is true, but one thing else, Iceland had a strong negotiating position as it is one of the countries on the Arctic Council. The Council is dealing with shipping through the arctic sea and Iceland is one of 8 countries on it. As part of China's FTA with Iceland, Iceland agreed to grant China observer status to the negotiations.
http://www.dw.com/en/china-iceland-sign-strategic-free-trade-agreement/a-16745190
http://www.telegraph.co.uk/finance/economics/9995525/Iceland-first-European-country-to-sign-free-trade-agreement-with-China.html

Even with this strong position, (they could offer china something no one else could) Iceland only got to sell Fish to china and China got to sell everything else to Iceland.
Note, Iceland's second largest export, financial services didn't get a look in. All financial companies in china are owned by chinese, there is nothing in this FTA that can give Brexiters any hope.

The trade is fairly small anyway - China imports about 80 millions worth of fish and about 8 millions worth of aluminium from Iceland. The netherlands is by far Iceland's biggest trading partner (importing 1.1 bn dollars worth).

Capt'n Midnight · 27-08-2017 10:45PM

steddyeddy wrote: »

David Davis has a new tactic. He's going to demand more flexibility in the negotiations. All this while the leaders of EU27 decide whether to allow trade talks to proceed. That's control ladies and gentlemen.

So far the UK has been flexible enough to offer EU citizens the exact same rights to stay that were already available to non-EU citizens in similar circumstances. AFAIK to do otherwise would have been a breach of UK law. And they still sent deportation letters to EU citizens who had applied to stay.

The UK has been flexible on customs , a magic computer system will solve all problems without the need for physical borders. This despite the loss of billions in tax to other EU countries because UK customs didn't stop Chinese fraud. If people smuggled stuff across a border when there was a "shoot to kill" policy you can take a wild guess at how well I think an invisible border will work.

The UK is so flexible on Data Protection which underpins financial services, that they pretend that it's not worth mentioning that David Davis himself has successfully challenged UK data retention law in the ECJ.

Peregrinus · 28-08-2017 01:34AM

LeinsterDub wrote: »

I'm aware of that options were presented to the British public. What you are doing is ignoring the reason a lot certain sector of the British public voted for brexit.

Yes, but Brexit was only carried by a 52:48 vote, remember. If even one Brexit voter in 20 favoured staying the the customs union, or would feel that accepting ECJ jurisdiction over aviation was a good deal if it meant staying in the Aviation Area, etc, then the likelihood is that there is majority support for policies like this.

We don't know, of course, because voters weren't asked. Which means its down to Parliament and the government to frame policy on such matters.

Samaris · 28-08-2017 07:23AM

The Labour policy won't work, and ironically, will give the issues that the Brexiteers have been whipping up hysteria about. Try take a Norway deal and the UK will still have to abide by a fair amount of the stuff it doesn't like only the UK will have no say in it.

Like it or not, it's too late for a "soft Brexit". Britain won't stand for it.

Now, the EU might allow it. Britain stays in, remains part of the trading area, can still trade with them and they probably won't plummet into another recession. Also, the EU gets to get on with what it's doing without Britain swinging the veto like a sock with a half-brick in it.

Sadly, at this point, I think it is best for both Britain and the EU if Britain shoos itself. Britain has mostly been a headache to the bloc. The point is that shooing itself is difficult - soft Brexit will not be accepted once it's explained (although they could go with a tried and tested Tory method at this point, explain it as "Soft Brexit means Soft Brexit", tell a pack of lies and then wonder why people are still mad). Hard Brexit is going to be rough as hell.

Solo - regarding the Iceland point, no, I was not joking. Iceland may be smaller than Britain but crucially, it is not relying on the China deal. It is already in a self-supporting position, and is expanding trade, not starting trade. It would be good for both, so both parties have some vested interest and no interest in waiting for the other country to be desperate. There is no ticking clock. Britain may be very big and have a strong manufacturing industry etcetera, but don't think other countries won't know that Britain's very future hangs on getting these deals. That is why Britain is in a weak negotiating position compared to say, Iceland making one deal. Britain will still be importing large sections of the quotas it signed up to of EU-imported foodstuffs; the current agreement is that Britain will carve out its portion and hike off with it. So Britain will be importing on a weak Sterling (which is the bad way around) from the get-go, and will desperately need to set up export routes to offset the costs (on a weak Sterling, which is good ...once they have some). It is also now in competition with the EU, and EU goods, thanks to strong regulations, are a known quantity. How is Britain to compete with a close, large exporter like that? Well, you know that bonfire of regulations Britain's been advocating? Sure, Britain might be able to undercut there, but they're pretty much going to have to advertise that their goods are lower quality than those of the EU (thanks to that bonfire of regulations that has been cheered on) and hope that their relative cheapness will attract consumers. Or keep the regulations and be able to export to the EU...although that's another promise (said bonfire) gone out the window (where it belongs, because it was a stupid promise).

That is the catch-22 there, not the size of Iceland.

solodeogloria · 28-08-2017 07:31AM

steddyeddy wrote: »

It's a no brainer alright. Your link reminds us of the fact trade is most important with neighbouring countries and you choose to discount that. You think reducing trade with neighbouring countries (EU) will lead to increased posperity for the UK. I find it very hard to accept you believe what you posted.

Good morning!

No. I acknowledged that distance is partially important but that large global economies are also important. My view reflects the understanding of the Office of National Statistics and I'm not interested in bending their analysis to suit my own conclusion.

There is a huge fallacy on this thread. People are presenting my position as trade with the EU vs trade with the wider world. The answer is both.

The reason why I can have open eyed optimism about the future in the UK is because it's clearly interested in continuing trade with the EU in addition to liberalising trade with the wider world. I'm looking to maintain as much trade with the EU as possible.

Much thanks,
solodeogloria

Samaris · 28-08-2017 07:42AM

In that case, that bonfire of regulations promise bears more looking at. The EU won't accept unregulated goods, or goods with less stringent regulations on quality than their own.

Peregrinus · 28-08-2017 07:56AM

solodeogloria wrote: »

The reason why I can have open eyed optimism about the future in the UK is because it's clearly interested in continuing trade with the EU in addition to liberalising trade with the wider world. I'm looking to maintain as much trade with the EU as possible.

You may be, but the British government clearly isn't. They have drawn a number of red lines around their own negotiating position which, if stuck to, mean that future terms for trading with the EU will be significantly more restrictive than the terms they enjoy at present.

Essentially, the UK government is targetting lousier terms for trading with the EU, in the hope that they will be able to negotiate better trading terms with third countries than they would get if they remained in the EU - not just better, in fact, but so much better that the advantage accruing will more that offset the detriment resulting from the lousier EU terms.

I've said before that I think this looks like a wildly unlikely outcome, and I have seen no serious attempt from anyone - not even from you, solo - to explain why anyone would expect it. Just a bit of handwaving about the UK being more "nimble" that, when challenged, was neither defended nor justified.

solodeogloria · 28-08-2017 07:59AM

Samaris wrote: »

In that case, that bonfire of regulations promise bears more looking at. The EU won't accept unregulated goods, or goods with less stringent regulations on quality than their own.

Good morning!

Again, we've been through this many, many, many times on this thread. It is getting a touch repetitive. I may have to go and find posts I've already made and quote them instead.

Obviously when you're exporting to third countries that you comply to their regulations. When shipping to America British exporters comply with American regulations, when shipping to the EU they will comply to the EU. Depending on what markets they trade with they will always be subject to regulations. As for why anyone thinks I would have any issue at all with this is another question.

The advantage is that after Brexit, the political union with the EU will end. A great deal more decisions will be able to be made in the UK domestically than would be typically made outside.

Peregrinus wrote: »

You may be, but the British government clearly isn't. They have drawn a number of red lines around their own negotiating position which, if stuck to, mean that future terms for trading with the EU will be significantly more restrictive than the terms they enjoy at present.

My ultimate destination is still outside the customs union and single market. I'm open to considering Labour's proposal as long as it is strictly time limited. Drop customs union first after agreeing new customs terms with the EU, and drop the single market after arranging a free trade deal with the EU and with other parties.

Much thanks,
solodeogloria

Capt'n Midnight · 28-08-2017 08:18AM

Has there been any economic good news out of the UK since Brexit was initiated apart from exporters and foreign investors who've benefited from the drop in Sterling at the expense of locals ?

Outside of Greater London the vast majority of BHS store locations are still empty a year after they closed. Prime retail locations.

Ford, BMW, Vauxhall and Mercedes are offering scrappage deals because demand for new cars is beginning to show signs of a sustained drop for the first time in around six years.

Havockk · 28-08-2017 08:47AM

solodeogloria wrote: »

Obviously when you're exporting to third countries that you comply to their regulations. When shipping to America British exporters comply with American regulations, when shipping to the EU they will comply to the EU. Depending on what markets they trade with they will always be subject to regulations. As for why anyone thinks I would have any issue at all with this is another question.

Which is why being in the EU was great for manufacturers, having a unified set of regs. UK manufacturers and providers having to comply with multiple regulations for each export jurisdiction is such a silly plan that it could have been straight out of the mouth of David Davis himself.

blanch152 · 28-08-2017 09:18AM

solodeogloria wrote: »

Obviously when you're exporting to third countries that you comply to their regulations. When shipping to America British exporters comply with American regulations, when shipping to the EU they will comply to the EU. Depending on what markets they trade with they will always be subject to regulations. As for why anyone thinks I would have any issue at all with this is another question.

Great, we have that sorted. Now, here is a rhetorical question.

Q: How are these standards and regulations checked?
A: Through customs checks at point of entry i.e. a hard border.

So if the UK is producing goods for the domestic market, for export to the US or for export to the EU, how does the EU know which ones it is getting? By implementing customs checks on a hard border. Leaving the customs union requires a hard border, simple as.

It is amazing that some people are making the illogical leap that says you can leave the customs union but have a frictionless border.

Jim2007 · 28-08-2017 10:05AM

solodeogloria wrote: »

The advantage is that after Brexit, the political union with the EU will end. A great deal more decisions will be able to be made in the UK domestically than would be typically made outside.

Given the options to the UK government at the council of ministers, that is really not much of a point. It is just a matter of where the UK government has it's say.

Peregrinus · 28-08-2017 10:09AM

solodeogloria wrote: »

Obviously when you're exporting to third countries that you comply to their regulations. When shipping to America British exporters comply with American regulations, when shipping to the EU they will comply to the EU. Depending on what markets they trade with they will always be subject to regulations. As for why anyone thinks I would have any issue at all with this is another question.

The advantage is that after Brexit, the political union with the EU will end. A great deal more decisions will be able to be made in the UK domestically than would be typically made outside.

So UK manufacturers will now be free to decide to comply with EU regulations, as opposed to the former tyrannical state of affairs in which the UK agreed to comply with EU regulations.

And for this they are leaving the largest and freest free trade area the world has ever seen? Please!

Billy86 · 28-08-2017 10:58AM

Working on a contract in the public sector at the moment and someone (who is both shockingly overpaid and shockingly useless at their job) in the office was on about how Brexit is a good thing and Ireland should do the same, to which a different colleague (sarcastically) put to them then that they should quit the union, look to cancel their current contract and then go back to negotiate better terms for themselves than they currently have. Kind of summed up the stupidity of the whole idea very quickly, in my opinion.

Anyway the GBP was worth €1.0804 this morning, getting closer and closer to parity. The only times the GBP has ever been below €1.08 to the EUR were about two weeks around new year 2008/09, a week in January 2009 and another two weeks in March 2009. Those were quite temporary and wildly tumultuous times due to the nature of the financial crash, whereas this looks more steady and enduring.

Jim2007 · 28-08-2017 11:16AM

Billy86 wrote: »

Working on a contract in the public sector at the moment and someone (who is both shockingly overpaid and shockingly useless at their job) in the office was on about how Brexit is a good thing and Ireland should do the same, to which a different colleague (sarcastically) put to them then that they should quit the union, look to cancel their current contract and then go back to negotiate better terms for themselves than they currently have. Kind of summed up the stupidity of the whole idea very quickly, in my opinion.

Anyway the GBP was worth €1.0804 this morning, getting closer and closer to parity. The only times the GBP has ever been below €1.08 to the EUR were about two weeks around new year 2008/09, a week in January 2009 and another two weeks in March 2009. Those were quite temporary and wildly tumultuous times due to the nature of the financial crash, whereas this looks more steady and enduring.

Here is the chart:

Zubeneschamali · 28-08-2017 11:25AM

LeinsterDub wrote: »

What you are doing is ignoring the reason a lot certain sector of the British public voted for brexit.

What you are doing is pretending that you know why the British public voted the way it did, and then pretending that that means British politicians have no choice but to wreck the UK.

Zubeneschamali · 28-08-2017 11:33AM

solodeogloria wrote: »

I'm looking to maintain as much trade with the EU as possible.

If that was what you wanted, you would stay in the EU. As you know very well, "remain" voter that you are.

But, if leaving, you would stay in the Single Market.

Or, if leaving that, you would stay in the customs union.

But no, because of reasons, you are leaving all 3. So "as much trade as possible" will be considerably less than today. Enjoy your recession.

Zubeneschamali · 28-08-2017 11:37AM

Peregrinus wrote: »

Essentially, the UK government is targetting lousier terms for trading with the EU, in the hope that they will be able to negotiate better trading terms with third countries than they would get if they remained in the EU - not just better, in fact, but so much better that the advantage accruing will more that offset the detriment resulting from the lousier EU terms.

Perhaps Solo believes like Fred, that the threat to damage trade with the EU is intended only to make the EU agree to some special deal. If so, they are about to find that the EU is too big to threaten that way.

But I think they really intend to damage trade, and the position papers are intended only to lay the blame with the EU afterwards.

Sam Russell · 28-08-2017 12:19PM

I came across this on a web site selling bicycles. Now I am not sure how big a company it is, but it indicates a view I find amusing, in a Brexit sort of way.

All products meet UK standards and are set up with UK braking, not European bikes set up for Europe!!

Perhaps this says it all - note the double exclamation mark. I think gravity and the laws of physics are more or less the same in the UK and Europe, but perhaps there may be a difference.

Fratton Fred · 28-08-2017 12:23PM

Sam Russell wrote: »

I came across this on a web site selling bicycles. Now I am not sure how big a company it is, but it indicates a view I find amusing, in a Brexit sort of way.

Perhaps this says it all - note the double exclamation mark. I think gravity and the laws of physics are more or less the same in the UK and Europe, but perhaps there may be a difference.

You do realise that in the UK and Ireland, the standard is for the front brake to be on the right, whereas in the rest of europe it is the left?

Fratton Fred · 28-08-2017 12:25PM

Zubeneschamali wrote: »

Perhaps Solo believes like Fred, that the threat to damage trade with the EU is intended only to make the EU agree to some special deal. If so, they are about to find that the EU is too big to threaten that way.

But I think they really intend to damage trade, and the position papers are intended only to lay the blame with the EU afterwards.

how do you know what I believe?

Jim2007 · 28-08-2017 12:27PM

Sam Russell wrote: »

I came across this on a web site selling bicycles. Now I am not sure how big a company it is, but it indicates a view I find amusing, in a Brexit sort of way.

Perhaps this says it all - note the double exclamation mark. I think gravity and the laws of physics are more or less the same in the UK and Europe, but perhaps there may be a difference.

Actually there may well be a difference - my Swiss bike has the brake leavers reversed...

Brexit discussion thread II

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