🇬🇧🇪🇺 Who caused Hard Brexit? Some thoughts from the perspective of a social scientist. In the last few days we have seen an interminable debate on whether Remainers, Soft Brexiters, or Hard Brexiters are responsible for Hard Brexit. And it’s a false debate. Why? 1/n

1/ Brexit politics is built on fear. Frightened people tend to seek security in the tribe. Once that tribe might have been the Labour movement, but now in a fragmented post-industrial society it is the nation. Tribal identification is emotional, not rational.

2/ A tribe that feels under threat wants to control its borders, and who enters into its territory. It demands loyalty and solidarity, and its prime virtue is self-sacrifice - economic arguments won't persuade tribalists. Its members want to feel it is strong and powerful.

3/ Tribalism at a time of crisis is intolerant of dissent. The tribe must pull together against its enemies. Dissent and questioning cause division and disrupt the collective effort. Criticism is seen as treason. The Brexit right have ruthlessly exploited tribal psychology.

4/ To understand Brexit politics it is necessary to understand that the working and middle classes are dead as coherent political forces and that frightened and insecure people are now clinging to the only available powerful tribe, the nation-tribe.

5/ The Brexit right understands and ruthlessly exploits basic social emotions. In contrast the centre and centre-left mostly can see no further than the blinkered logic of rational individualism, from which perspective everything else is irrational and incomprehensible.

Amid all the announcements today, it's easy to overlook that the OBR has updated its scenario on a no-deal Brexit. It exposes an undeniably hard reality for the Govt that claims that the UK would "prosper mightily" under no-deal next year.

(Short thread)

1. Key chart: a no-deal/WTO/Australia-style Brexit would delay the point at which econ output regains its pre-virus peak by "almost a year to the third quarter of 2023."

In the upside scenario, this cross-over point could be at the start of 2022; in the downside, in 2025. Grim.

2. Next year, a no deal Brexit would reduce real GDP by around a further 2% - as a result of immediate disruption to the border and uncertainty facing businesses. That's on top of the Covid-related contraction.

3. While there's some short-term border disruption, most of the costs come in the medium term: from lost employment; productivity losses; lower business investment.

Exactly the opposite of what the Chancellor said to @AndrewMarr9 on Sunday.

4. Underneath these numbers, output would fall *below* the Covid levels for several key sectors: Manufacturing, professional services, financial services, retail, energy.

All trade intensive sectors that have been spared the same drop in output as the non-tradables this year.

Been a lot of discussion recently around services trade in the deal between the UK and EU. Having read through the agreement over the past couple of days, my impressions👇

First off, services is definitely included. Question for service providers, is will it be enough?

1/N

My overall impression is that the EU has offered among the best in class for its FTAs similar to Canada and Japan.

But this access is a far cry from access to the Single Market and how is constructed as part of a trade agreement for the EU reflects that.

2/n

Unlike for goods trade, once you've got a product through all the customs and regulatory procedures into the EU, it can be sold anywhere in the EU, or its "entered circulation".

For services trade, that isn't the case. Its still done on a member state by member state level.

3/n

This is even true in the trade agreement itself where although the provisions set out in the Services and Investment chapter sounds awfully good - lots of principles about the freedom to establish and allowing the cross-border trade in services.

It's only when...

4/n

You get to the annexes and you realise both the EU and individual member states have put entry conditions across huge areas of different services sectors both now (existing measures) & in the future. Don't worry too much about the future reservations, it's the existing ones.

5/n

Over the past 15 days I have not only been running my company as normal but I have been faced with largest threat to its future since it began in 1992. This is #Brexit & here is my thread on just how bad things are getting. 1/26

Six months ago my business started to prepare for Brexit. We obtained the following licences and accreditations JUST to maintain the status quo. EORI number, RORO badge for Chief, GBRC number, GBWK number, we already had ARWS and DAN accounts. 2/26

All of this took nearly five months a lot of form filling but on the 9th December this was all in place. So I would say whilst we knew Brexit would be a car crash we did not know it was going to be a multiple pile up in the fog with fatalities. 3/26

On January 4th I returned to work being wise enough to have stockpiled just enough so that if we had a bumpy ride in January we would have enough stock to last until February. 4/26

I should add this took a considerable amount of cash flow and management to do this during a lockdown/ pandemic combined with Xmas sales. But we managed. 5/26