A full-scale trade war with the EU is unlikely, but Britain is already suffering bitter side effects


This article is an on-site version of our Inside Politics newsletter. Register here to receive the newsletter directly in your inbox every day of the week

Hello. Almost all of you thought yesterday’s newsletter was nonsense, nut soup. On second thought, me too. Some thoughts on this, and the UK government’s Brexit strategy below. Let me know what I’m wrong today at the email below.

Inside Politics is edited by Georgina Quach. Follow Stéphane on Twitter @stephenkb and please send gossip, thoughts and comments to insidepolitics@ft.com.

Our latest stories

beyond the horizon

The UK government will scream and scream until it’s sick: New legislation to undo the Northern Ireland protocol will be introduced in parliament On Monday. Tory Eurosceptics yesterday fired a warning shot at Boris Johnson, telling him they could vote him out if he doesn’t ‘neutralize’ the Brexit text completely.

As I’ve written many times before, I don’t think we should take the UK government’s position on this seriously. Time and time again, Johnson’s government stamped its foot, telling friendly newspapers of its intentions to tear up the protocol before capitulating. As Peter Foster, the FT’s public policy editor, writes in his excellent weekly newsletter Britain after Brexit, new legislation would be the beginning, not the end of the story:

Even imagining for a moment such a bill becoming law (from afar) and Johnson’s ministers using the powers it contains, it was never clear why Johnson or the DUP thought it would solve the dispute over protocol.

According to Johnson, what would happen after this unilateral action to overturn the protocol? How do his supporters think Sinn Féin would react to such a decision? Not to mention the European Commission and EU capitals?

Pulling the trigger only leads to the threat of a trade war with Europe during the worst cost of living crisis since the 1970s and further polarizes the peace process even in Northern Ireland as the Johnson government says seek to protect and defend.

The UK’s annual capitulation to the Brexit talks has been going on uninterrupted since 2018 (as readers of the Essential Trade Secrets Briefing will know) and I see no reason to think that streak will be interrupted.

But I wonder if we’re underestimating the political cost of what you might call “non-trade war actions.” If, because of the protocol dispute, the EU prevents British universities from accessing the 95 billion euro Horizon Europe research program – the largest in the world – is it a “trade war”? If future collaboration on new technologies or other projects is blocked by the bad air created by the UK government briefing, is this a “trade war”?

I still believe that, given the economic costs of a trade war with the EU, the UK government will do what it has always done and find a way out of a total standoff with the EU. But we should, I think, be less concerned about whether there will be a real trade war with the EU (there won’t be, because the UK government will always back down) and more focused on the parties the UK economy will experience its own private trade war.

It hurts, but it works

Yesterday I wrote that a bad economy was bad news for the Conservative government, but good news for Boris Johnson because no one else would want the job given the tough economic times. Via email, text and phone, you stood up as one to ask “Stephen, are you under glue?”. As one reader wrote:

I strongly disagree with you that potential successors to Boris Johnson are put off by the current state of the UK economy and its even bleaker outlook. In 21 years of working for successive British governments, I have never met a single minister whose ambition to rise to higher office would be significantly curtailed, even by more dire economic circumstances than the OECD predicts. .

Moreover, the nature of most politicians’ egos is such that no more than a handful of those I have dealt with would have serious doubts about their ability to fix things if they had any. the occasion. In short, I think you underestimate the power of ambition and ego within the political class.

In my defence, several backbench Tories thought that, while I was wrong in thinking that potential successors to Johnson might be put off by the dire OECD figures, it Is help the Prime Minister that MPs looking for a better alternative might well look at the dire economic situation and conclude that it is no better alternative. But I accept that any potential candidate will not be deterred by bad economic news.

Another person who was not convinced by yesterday’s email is Robert Shrimsley. But he made a good point about how the poor economic situation is helping Johnson and the Tories. The painful measures that British politicians have tended to adopt to fight inflation are those that Conservative governments have been more comfortable doling out than Labor.

I think it’s true. If the next election turns into a question of “who is more willing to hurt households?” which favors conservatives. But if the Prime Minister is unable to articulate the need to do so in advance, it will not do him much good.

Now try this

I really appreciate the novelty star wars TV series. Here’s that man Robert Shrimsley again on more worthy creations from their own cinematic universes, from When Harry Met Sally at The Godfather.

My column this week examines the trend of “fan capture”: when mission-aligned organizations end up talking to themselves and undermining their own goals. Have a good week-end.

EuropeExpress — Your essential guide to what matters in Europe today. Register here

Britain after Brexit – Keep up to date with the latest developments as the UK economy adjusts to life outside the EU. Register here


Comments are closed.