There is a strong sense of a new beginning for the European Union, one that has nothing to do with Brexit but much to do with Emmanuel Macron and with an economic upswing. As the former Le Monde editor Natalie Nougayrede wrote in The Guardian, the change of mood in Europe is bringing talk of “new roadmaps” between President Macron and Chancellor Angela Merkel, of a chance not just to revive Franco-German cooperation but also to rebuild the European Union.
Some of this talk may be Schadenfreude, pleasure at the misfortunes of others, especially now that France’s youthful new president is sitting on exactly the sort of parliamentary dominance that Britain’s Conservatives were expecting barely two months ago. Some, certainly, is premature, with unemployment still high, the anti-euro Five Star Movement still leading Italian opinion polls, and with migrants still arriving, and dying, in large if diminished numbers from across the Mediterranean.
Certainly, whatever problems Macron may encounter in achieving the reforms he promises, the contrast between the British and continental moods is a far cry from eurosceptic talk of how Britain’s EU membership meant it was shackled to a corpse, as Douglas Carswell so eloquently put it, echoing a First World War phrase about Germany’s alliance with the fading Austro-Hungarian empire. The scholarly Daniel Hannan MEP made the same claim in his also war-referencing video, Ici Londres.
So, while most of the British focus is on what difference our election result and consequent governmental fragility may make to the Brexit negotiations, it is worth asking the corresponding question about the other side of the Channel: what difference might an awakening “corpse” make?
There are likely to be three parts to this, beyond the simple question of how far the EU really does reawaken: an effect on the interests of the other 27 member states in the Brexit talks; an effect on the domestic politics of some of those member states; and an effect on British public opinion.
Let’s take those in turn. The effect on the interests of the other 27 member states is likely to be minimal or non-existent, just as the effect of Britain’s governmental fragility on our interests is also likely to be minimal. Absent any serious further threats of withdrawal or substantial fragmentation – which Marine Le Pen’s resounding defeat has removed, for now, though Italy’s Five Star could in theory pose such an issue, if they were to get close to power – the interest of the 27 in minimising the disruption of Brexit, in protecting the existing treaties and in maintaining a friendly relationship with Britain will remain the same.
Interests typically do not change with swings of mood or fortune, especially in such a deep, strategic relationship as this. But domestic politics can be affected by mood swings, and probably will be, to some extent. However a strong Macron, like a strong Merkel if that is what Germany has after that country’s elections in September, will feel little need to pander to nationalistic domestic opinion by being “tough” on Britain. His political success, combined with a warmer economic climate, can be expected to allow him to follow French and EU interests closely, rather than playing political games.
The real variable lies in the third part: British public opinion. Comparing the 1975 referendum with 2016, a key difference was plainly the sense a year ago that the EU was a dysfunctional, divided, perhaps even failing entity, whereas four decades earlier it had looked like a success story. During the 18 months of divorce negotiations, and even more so during the likely longer negotiations during a transitional period, that sense could change.
If the talk of new roadmaps proves to be genuine, we can expect major initiatives in at least three main areas: defence, infrastructure and the euro. Of those, progress or otherwise on the euro is unlikely to concern Britain. That would not, however, be true of the other two.
If Macron and Merkel were to agree upon an ambitious programme of public investment, for example, outside the EU’s fiscal pact and focused most likely on infrastructure and an electricity supergrid, this could produce some jealous glances from Britain. This would not necessarily change minds about membership as such, but it could alter thinking and interests about the terms of our future relationship.
The same is true of defence. Longstanding British objections to any threat of sidelining NATO has held back EU defence cooperation, so Brexit will make that easier. But Britain will still be affected, and perhaps tempted, both by moves to co-ordinate defence procurement (for which cost and US-dependency is as big a problem for Britain as it is for France), and by further development of joint operations, as are already being conducted (with British participation) in the Mediterranean. Again, EU progress could alter British thinking about what sort of future relationship could be in our interest.
The European awakening could bring surprises and progress in all sorts of fields, including trade relations with Asian, African and Latin American countries. If the “corpse” really starts to become an athlete again, the country that chose to be a spectator, Britain, cannot fail to be affected.
Edited by Luke Lythgoe
It is rare to be able to say this, but an article in the anti-EU Daily Telegraph by the always stimulating Roger Bootle has put the issues surrounding “soft” versus “hard” Brexit, as well as the outcome of the general election, in a particularly clear light. Without meaning to, Bootle shows clearly why it is such a mistake for Britain to be leaving the European Union.
A well-known and respected City economist, Bootle is chairman of Capital Economics but also, most relevantly, one of the driving forces of the group now calling itself “Economists for Free Trade”, originally “Economists for Brexit”.
The point of his article, as indeed of his lobby group, is to argue that a compromise arrangement, one that might match Norway’s membership of the EU single market or Turkey’s of the EU’s customs union, would forgo the main benefit of Brexit: the opportunity to eliminate the EU’s remaining tariffs on goods imports (which average 4% but are more than double that on cars and far steeper still on food imports) and to engage in substantial deregulation right across the board.
To put this another way: Bootle is saying, with admirable candour, that if post-Brexit governments do not engage in unilateral free trade (or at least, much freer trade than the EU does) and in widespread deregulation, we might as well stay in. As he writes:
“Brexit is neither the road to perdition nor the road to riches. It presents a series of challenges and opportunities. To make the most of them we need to embark on a path of lower corporate and personal taxes, and deregulation. Philip Hammond, the Chancellor, has dubbed this strategy “Singapore on steroids”. If Labour were in government, however, it would accompany Brexit with increases in corporate and personal taxes, and increased regulation. That would be Venezuela on steroids.”
So there is the choice: Singapore on steroids (but by the way, even without steroids, to match Singapore would require Britain to halve the share of the state in GDP, as The Economist’s Banyan column recently explained) or Venezuela on steroids.
That’s a legitimate debate. With Jeremy Corbyn’s Labour Party now ahead of the Conservatives in opinion polls and a new general election widely expected within the next 12 months, it is a debate the country may be about to have.
So far, in fact, neither party has seriously proposed either of Bootle’s steroid-enhanced options: the Tories, no doubt conscious of the landowners in their own ranks as well as the views of many rural Leave voters, have promised to maintain farm protection after Brexit and have avoided pledging radical deregulation of environmental controls, for example; Labour’s manifesto was deliberately a great deal more moderate than Venezuela’s late President Hugo Chavez would have liked.
This is for two reasons: first, both parties assume that the consensus among the British public is closer to the centre than either of Bootle’s steroid options; second, for the time being Britain remains subject to the EU agreements it has signed on issues such as state aid and competition policy, and thus subsidisation programmes would be illegal, as would be nationalisations that distorted competition.
When Britain leaves the EU, that will change. We cannot know what a future government led by Corbyn or one of his Momentum followers would try to do. It would, of course, be constrained by international financial markets as well as by more moderate colleagues such as Keir Starmer. But it would not be constrained by membership of the EU.
That is what Roger Bootle and his fellows at the “Economists for Free Trade” group would have achieved, after Brexit. Their well-intentioned arguments depend on Britain being run by people like them: “experts”, as Michael Gove called them. The whole point of a democracy is that governments in fact alternate, reflecting changes in public opinion. Part of the point of EU membership, for all members, has been the constraints it puts on the wild, often damaging swings of opinion and policy.
Vote Brexit, get Venezuela: thank you for that insight, Roger Bootle.
Edited by Luke Lythgoe
Theresa May is desperate for the 10 votes of Northern Ireland’s Democratic Unionist Party to give her a majority at Westminster after her election disaster. The DUP will no doubt be delighted to oblige – at a price. Yet the deal could prove a very mixed blessing both for Brexit negotiations and the Northern Irish peace process.
Holding the balance of power in a hung UK parliament gives the hard-line Ulster loyalists a fantastic opportunity to hold the UK government to ransom. Most commentators expect they will demand a substantial boost in subsidies from the UK government, running at an annual £10bn from the Barnett formula alone. But that is the easy part.
As far as Brexit is concerned, the attitude of the DUP has long been ambiguous. The party was a strong supporter of Brexit, and indeed was responsible for laundering an unexplained £425,000 donation through its accounts to the Brexit campaign in Britain. The closest allies of the DUP MPs at Westminster are all hard-line Brexiters on the right-wing of the Tory party, who favour a hard Brexit, or no deal at all.
That is not the official position of the DUP. Arlene Foster, the party leader in Belfast, is adamant that she does not want to see a “hard” border reintroduced between Northern Ireland and the Republic. She knows that would be the inevitable result of “no deal” with the European Union. It would wreak havoc with cross-border trade relations, with a direct effect on the livelihood of many DUP supporters.
On the other hand, the DUP is committed to the principle of having some form of border, to ensure that the sovereignty of Northern Ireland is never called into question. One of the assurances the party will seek from May for their support at Westminster is that she will block any plan to hold a “border poll’ – a referendum on Irish reunification allowed for under the 1998 Good Friday agreement and favoured by Irish nationalists. Another demand will be to veto any proposal to give Northern Ireland a “special status”, a sort of halfway house between Britain and Ireland. A third is that there should be no reinforcement of border controls between the islands of Britain and Ireland, which might interfere with free movement within the UK.
The DUP will be in a much stronger position to insist on such red lines if it is May’s essential partner in power. The effect of May’s deal on the peace process could be even more dangerous. The Good Friday agreement requires that in the event of any conflict between the unionists and nationalists sharing power in Belfast, the UK and Irish governments must act as impartial arbitrators. That is precisely the current situation in Belfast, where power-sharing between the DUP and Sinn Fein has been suspended. But with her government depending for its survival on the 10 DUP MPs at Westminster, May cannot pretend to be impartial.
This matters in Dublin – Irish prime minister Enda Kenny tweeted on Sunday:
When the referendum campaign was fought last year, the idea that Brexit might disrupt the peace process was airily dismissed by Brexiters as “ridiculous scare-mongering”. Indeed, the effect of Brexit on both Northern Ireland and the Republic was barely discussed by either side in the campaign.
Now, as a result of the election and May’s lost majority, the Irish question will be forced onto the agenda – and the DUP will have an effective veto on any compromise. That could prove disastrous for a Brexit deal and disastrous for the peace process, too.
Edited by Geert Linnebank
No one can know how the British economy will perform in coming years, since we do not know what the international environment will be, nor what impact government policies will have. As the respected, non-partisan Institute for Fiscal Studies (IFS) said today, both major parties’ manifestoes leave voters in a fog about likely levels of taxes and public spending. But the economy itself is providing some clear indications about the circumstances during which Brexit will be implemented. They are not good.
Growth figures covering just three months are notoriously unreliable. Initial estimates are often revised later, in either direction. Nevertheless, those from the Office for National Statistics (ONS) for 2017’s first quarter, released yesterday, did confirm some trends that should surprise no one:
- Rising inflation (an annual rate of 2.7% in the latest month) is eroding real incomes and thus consumers’ spending power. The pound’s post-referendum devaluation has returned UK inflation to a higher level than elsewhere in Europe.
- Growth in GDP per head, the best indication of overall living standards, is flat – and GDP growth itself is a measly 0.2%, thanks to Britain’s combination of population growth and weak productivity.
- The business investment that would be required to raise productivity remains weak, probably thanks to the uncertainty about regulatory and economic conditions created by Brexit. Inflation-adjusted business investment did return to growth in the quarter for the first time in a year, but only modestly.
As far as Theresa May is concerned, this week did bring one positive feature: net immigrationdropped by 84,000 to 248,000 last year. But that is still nearly two-and-a-half times as high as the maximum the Tories are promising in their manifesto.
What’s more, the IFS points out that lower migration will reduce a Conservative government’s tax revenues. As the IFS’s Carl Emmerson says, the Office for Budget Responsibility “has already downgraded its forecasts for receipts by £6 billion in 2020–21…due to lower expected net immigration. Meeting the Conservatives’ commitment to reduce immigration to the tens of thousands would hit tax revenues by a similar amount again.” On that basis, the Conservatives will be about £12 billion short – if they hit their immigration target, that is.
With a new YouGov opinion poll showing Labour narrowing the gap with the Conservatives to only five percentage points, the pound has again been sliding. May could well say that this just goes to show what a danger Jeremy Corbyn would pose as prime minister. A more balanced assessment would be that more falls will keep pushing inflation up.
Moreover Brexit, especially given Corbyn’s ambiguous attitude to it, is itself responsible for making a Labour victory worrying for investors: removed from the constraints of EU treaties, post-Brexit Labour would be able to reintroduce state aids to pet industries, especially nationalised ones, and pursue protectionist trade policies.
None of that is in Labour’s manifesto, of course. But then neither party’s manifesto looks a reliable guide to what it would actually do.
Edited by Hugo Dixon
Theresa May says everybody should rally round her so she has a strong hand to negotiate Brexit. What she’s actually asking for is a landslide so she can ram through Brexit at any cost – even if it means driving the economy over a cliff. She’s picking a fight with Europe, because she thinks that’ll win her votes and we’ll all join her in sticking two fingers up to Brussels.
Such aggressive talk alienates our partners and makes it more likely we’ll crash out of Europe with no deal.
That would be bonkers. Don’t give Theresa May a blank cheque to wreck our future. Vote for the most pro-European candidate in your constituency on June 8.
All over the world, this is a time of new parties, new movements, of outsiders coming as if from nowhere and winning elections. So isn’t it strange that in Britain, just one week into a general election campaign, an assumption has taken hold that the UK must inevitably on June 8 hand a huge Parliamentary majority to the country’s oldest, most established political party, the Conservatives?
There are some good reasons for this assumption, most plainly the utter fecklessness and disarray of the second oldest party, Labour. But that disarray itself shows that this could also be a time of opportunity.
Politics has never been more volatile, because the long aftermath of the 2008 financial crisis has discredited mainstream parties and destroyed old political loyalties.
Donald Trump conquered the Republican Party and then won the presidential election by exploiting exactly that anger and distrust. In Italy, the Five Star Movement led by the comedian Beppe Grillo in 2013 made the most successful national electoral debut in West European democratic history by simply representing something new and uncorrupt, and are now leading the opinion polls for the next general election, due at latest by May 2018.
On Sunday, Emmanuel Macron pulled off the same outsider’s trick to head the first round of France’s presidential election. It would be premature to assume he will win easily in the second round on May 7 against Trump’s favourite, the anger-exploiting Marine Le Pen, but his success in creating a new political movement based on hope should already offer inspiration to others.
The second round in France will be fought on the issue of how to define patriotism: as something that embraces an open society and close collaboration in Europe, or as something that requires the closing of borders and a new competition against neighbours over trade.
Britain’s choice on June 8 will be a similar one – but while in France the two contenders will strive to make the choice as clear and stark as possible, in Britain all the effort looks like being directed at blurring the issue.
Brexit has created a new and deep divide among voters, all over the UK. Despite every attempt to make it otherwise, through promised giveaways such as the capping of energy prices or assurances about the future of the NHS, June 8 can only really be a vote about Britain’s future place in the world.
Tony Blair is right, in his article in today’s Guardian, that the Conservative argument that a big majority is necessary to give Theresa May a stronger negotiating position over Brexit is a seductive one that cuts through all other policy positions and issues.
But that argument needs to be countered, and the effort to do so can serve to create a new patriotic vision of Britain and its future.
The Tory argument for a strong negotiating hand risks diverting attention away from the crucial issue of what sort of Brexit May wishes to achieve.
It is also a delusion: it might make her stronger when haggling over secondary matters such as Britain’s financial divorce obligations, but will have no bearing on what sort of future trading relationship with the EU emerges from the talks.
This creates an opportunity, both during the campaign and after. Seven weeks is clearly too little time to follow either Macron or his defeated far-left opponent, Jean-Luc Melenchon in building a wholly new organisation and movement. But such an effort can begin with the campaign, and then continue afterwards.
The extraordinary result in Scotland of the 2015 general election already showed that the UK is not immune to political volatility.
Well-directed and coordinated efforts to force candidates to expose what sort of Brexit they truly stand for and what sort of British place in Europe and the world they favour, could define this election as clearly as will be the case in France.
As Macron saw, this is not a matter of right or left. Old party labels no longer capture today’s issues. That means that the potential to shape Parliament and the debate over the next five years through the campaign and the result on June 8 is high.
In today’s volatile politics, no conclusion is foregone.
Edited by Geert Linnebank
During the referendum, Leavers loudly defended the rights of EU citizens legally resident in the UK. Now many pro-Brexit MPs are not practising what they preach. They have so far refused to back legislation requiring the government to guarantee these citizens’ rights.
We’ve gathered below some of the statements made before and after June 23 by Boris Johnson, Michael Gove and eight other prominent Brexiters.
When a Number 10 spokesperson suggested in May 2016 that it was “possible” a vote to leave would endanger EU citizens’ rights in the UK, Peter Bone called it “absurd”. The Tory MP insisted that “any EU citizen that is legally here if we come out of the EU would absolutely have the right to remain here.”
Jacob Rees-Mogg said it was “really grubby politics” to worry people who had established “a legitimate right to be here”. He told PoliticsHome: “It would be straightforwardly immortal [sic] to deport people who have come here legally and who have established their lives here.” Rees-Mogg also called on the government to give EU citizens an “unequivocal guarantee” they would be allowed to remain in the case of Brexit.
On June 1, Vote Leave itself issued the following statement signed by Boris Johnson, Michael Gove, Gisela Stuart and Priti Patel: “There will be no change for EU citizens already lawfully resident in the UK. These EU citizens will automatically be granted indefinite leave to remain in the UK and will be treated no less favourably than they are at present.”
The reassurances continued immediately after the referendum.
On July 3 Conservative MP Peter Lilley and UKIP’s only MP Douglas Carswell signed a letter in the Telegraph urging “the government, opposition parties and every candidate standing to be the next Conservative Party leader – and hence prime minister – to make an unequivocal statement that EU migrants currently living in the UK are welcome here, and that changes would apply only to new migrants.”
The next day Tory leadership challenger Andrea Leadsom, now a cabinet minister, declared: “I commit today to guaranteeing the rights of our EU friends who have already come here to live and work. We must give them certainty, there is no way they will be bargaining chips in our negotiations.”
Then, on 6 July, the Commons passed a motion which asked the government to “commit today that EU nationals currently living in the UK shall have the right to remain”. Only two MPs voted against.
Outspoken Tory Brexiter John Redwood also agreed that “we need to offer reassurance”. Alongside Johnson, Redwood and 251 other MPs who voted in favour of the motion (although in the knowledge that it would be non-binding and have no effect on government policy) was Carswell.
The Brexit bill
Since Theresa May became prime minister and set herself against guaranteeing EU citizens’ rights unilaterally, all these Brexiters have changed their tune – even UKIP’s Carswell and Labour’s Stuart.
Bone, Carswell, Gove, Johnson, Leadsom, Lilley, Patel, Redwood, Rees-Mogg and Stuart all voted against new clause 57 when it was debated by the House of Commons, which said: “Nothing in this Act shall affect the continuation of those residence rights enjoyed by EU citizens lawfully resident in the United Kingdom on 23 June 2016.”
InFacts approached each MP mentioned in this article for comment. At time of publication only Jacob Rees-Mogg had replied, saying: “The amendment was irrelevant to the Bill. It may be appropriate in the Great Repeal Bill.”
The House of Lords has, however, passed an amendment saying, within three months of the act passing, the government must bring forward proposals to ensure that EU citizens legally resident here lose none of their rights.
Those Brexiters who once spoke so passionately about EU citizens’ rights have one final chance to practise what they preach when the Brexit bill comes back to the Commons next week.
Brussels: The European Commission will be piling Pelion on Ossa if it decides to slap a €2 billion bill on the UK for negligent customs management while already putting together a case for a Brexit charge of up to €60 billion. But it will not be easy for the Commission to ignore the recommendation from Olaf, its anti-fraud unit, following an investigation which concluded that British customs were effectively turning a blind eye to Chinese footwear and textiles flooding into the EU at a tiny fraction of their production cost.
Even though not complicit, Olaf’s allegation implies that the customs authorities were serving the purpose of an organised crime network to minimise customs duties (reportedly, the calculated loss to the EU is €2bn) and maximise evasion of VAT worth up to €3.2bn. In considering the Olaf report, will the imminence of the Article 50 process weigh on the Commission’s judgement or will it try to deal with the issue entirely on its own merits?
Any attempt to levy a stinging fine will be grist to the mill of the pro-Brexit British press. While constantly lamenting the incidence of fraud in the EU, they will not see the irony of the UK becoming a target of the EU’s fraudbusters. Rather, it will be presented as the EU’s determination to make Britain pay for the Brexit betrayal and still more reason for shaking off the shackles of membership on any terms as quickly as possible. Like it or not, doing right by Olaf will guarantee a sour launch to the Article 50 talks.
That is not the only negative aspect for both parties. Understandably, the British enter the talks seeking to have the softest possible customs procedures applied to bilateral trade after Brexit. Any indication that Her Majesty’s Revenue and Customs sometimes falls down on the job will not be good for the Union’s confidence that UK procedures are up to the mark.
The Brussels authorities may also think a strict approach is necessary “pour decourager les autres”. It is now commonplace that the Commission and EU member states will not do a deal on Brexit that may incite others to step out of the Union. Similarly, the Commission will want to demonstrate to the 27 that a casual approach to applying external tariffs will not go unpunished.
Olaf appears to have had several meetings with HMRC about the Chinese textiles and footwear problem between 2014 and 2016. Customs clearance remained as it was and, according to Olaf, “the fraud hub in the UK has continued to grow”. HMRC apparently does not recognise the numbers Olaf is circulating but does not deny it may have a case to answer.
It might be thought that an early settlement of this row would be in the interests of both sides to prevent it becoming caught up in the numerically much larger confrontation over how much the UK should pay up on its exit from the Union. But the British may want to deny any liability and defend the integrity of their customs operations through to a bitter end. After all, resisting the EU is what comes naturally.
by John Wyles | 09.03.2017
Edited by Hugo Dixon
It might seem odd that the government is so determined to reject the amendment which sets out in the Article 50 Bill the necessary steps for parliament to approve any divorce settlement with the EU or any new partnership agreement, given that the prime minister promised in her Lancaster House speech that the government would put the final Brexit deal to a vote in both Houses of Parliament – a position repeated in its White Paper.
Yet, within minutes of the vote, it had vowed to reject the amendment. And it appears to be allocating just one hour next Monday to debating and voting on each of the Lords’ two amendments – which involve the wellbeing of three million European citizens living and working here and the proper functioning of that parliamentary sovereignty for which the Brexiters campaigned to take back control.
What is there not to like about the latest amendment? Well it certainly does not slow down the triggering of Article 50. Indeed, the bill could become law instantly on Monday if the government accepted the amendments.
Is it because promising votes on any deal in both houses risks ending in deadlock, with one house approving the deal and the other rejecting it? Well, if that is a risk, it is one entirely of the prime minister’s own making, since she originally set out the formula in her Lancaster House speech. But it is not a real risk, because the government is free to seek approval for a deal through primary legislation, which ensures the primacy of the House of Commons.
Is it then because the amendment requires the government to seek parliamentary approval before walking away from any attempt to negotiate a deal at all and thus crashing out of the EU without one? The prime minister has referred to that as a possibility, so it cannot be discounted. But if such action can be carried through without parliamentary approval, where then is the recovery of parliamentary sovereignty?
The government has said that the amendment would drastically weaken the prime minister’s negotiating hand and result in our EU partners offering us a really bad deal with the aim of getting the referendum decision and the triggering of Article 50 reversed. The people using that argument are the same ones who a few weeks ago were confidently asserting that we had an incomparably strong negotiating hand because our EU partners were so keen to go on selling us BMWs, prosecco and Camemberts.
In any case, it is a perfectly sustainable argument that provisions for parliamentary approval like those in the amendment would in fact strengthen the prime minister’s negotiating hand. After all, Article 50 itself lays down the provisions for parliamentary approval of any deal on the EU side and nobody seems to think that that is weakening its hand.
It really would make much more sense for the Brexiters to get over their paranoia about EU intentions and accept that the amendments will strengthen our negotiating hand, not weaken it.
by David Hannay | 09.03.2017
Edited by Hugo Dixon
An extraordinary surge in support for Germany’s Social Democratic Party (SPD), following the nomination of Martin Schulz as candidate for chancellor, has galvanised voters and transformed the German political landscape almost seven months before the September general election.
The implications for the UK government’s Brexit negotiations could be profound. For a start, the revival of the SPD – which is now running neck and neck with Angela Merkel’s Christian Democrats – has coincided with a slump in support for the eurosceptic and anti-immigration Alternative for Germany (AfD), down from around 15% to below 10% in most polls. The central contest is now likely to be between two strongly pro-European contenders. Anti-Trump sentiment, and widespread fears over the consequences of Brexit, have contributed to a revival of the centre ground.
It would be wrong to write off the influence of the AfD too soon, although the party leadership is now pulling itself apart in a power struggle with extreme right-wingers. It will win seats in the Bundestag for the first time, and greatly complicate the process of forming a new coalition government. But no one will want to govern with them.
The AfD is the one party that is positively sympathetic towards Brexit, although the party is officially anti-euro, not anti-Europe. There are some Eurosceptics in the Bavaria-based Christian Social Union, too – although they don’t want to see the EU disappear. For the overwhelming majority, EU cohesion – and its preservation – is a matter of fundamental German national interest.
Merkel and Schulz both believe their first priority is to preserve the unity of the remaining 27 member states – and the integrity of the internal market. Hence the German twin-pronged attitude to the negotiations with the UK: “No punishment, but no cherry-picking either”.
The SPD would strongly oppose any special deal for the City of London as the worst sort of “cherry-picking”. Schulz also believes, from his time as president of the European Parliament, that national capitals have grown too strong at the expense of EU institutions, and that the British have been the biggest culprits. He will not weep to see the UK go. Merkel would regret it.
A hard-fought election, followed by at least two months of negotiations to form a coalition, means that Berlin will not focus properly on the Brexit negotiations before January 2018. The future coalition could be another grand coalition – although the SPD would try anything to avoid it. It could also be a Merkel-led alliance of Christian Democrats, Greens and liberal Free Democrats. Or a resurgent Schulz might lead a “red-red-green” coalition of SPD, Greens and the far-left Linke. None of them would be very easy to negotiate, or operate. But all would put EU cohesion above making concessions to Theresa May.
For Berlin, according to one senior government official, negotiating Brexit is “a second-tier problem… The chancellor would like to have good relations with the UK, but it is not what keeps her awake at night.
“Our belief is that the Brits will take a long time to figure out what they have done to themselves. That is not our business. We have to figure out how to keep the 27 together.”
Although there is no desire to “punish” the UK, there is a real fear that the process will get poisonous. “The destructive power of the divorce negotiations will be so enormous that the co-operative stuff will be crowded out,” the official says. “You can come back to it afterwards, when you have done all the hard part.”
by Quentin Peel | 09.03.2017