The chancellor of the exchequer has been supposedly one of the more single market friendly members of the cabinet, which makes his comments to the German newspaper, Welt am Sonntag, this morning all the more interesting. He said that if the UK floated out of the single market it could abandon social democracy. Or as Phil put it, “European style taxation systems, European style regulation systems” will go.
What does this really mean? For a start, Hammond is continuing May’s strategy of coming out fighting pre-EU negotiations instead of trying to play nice. The theory is that if the UK says they will prioritise immigration control over market access, threatening that if they are booted out of the single market as a result Britain will retailiate by eliminating regulations, slashing taxation to lure companies and high earning individuals, then the EU are more likely to offer the U.K. a good deal. I’ll believe it when I see it (the good deal arising, I wish to stress), but that’s a big part of what Hammond is doing here: the ol’ iron glove wrapped in velvet routine.
But I do think it’s not an empty threat: if Britain leaves the EU, particularly with no transitional arrangements, then what Hammond is saying is very likely to be the way this country goes, partly by necessity, partly by choice. I’ve said this so many times now I’m sick of hearing myself saying it, but here we go again: a major reason many on the Right had for being Eurosceptic, deep down I mean, is that leaving the EU would necessitate drastic change, and that under a Tory government such change would have to be less tax, less regulation, small state. Or at least, having achieved Brexit, those in parliament disposed toward this are going to everything they can to make this direction happen.
When you put together what Hammond has said, what May has said – and is about to say – combined with where the people across the negotiating table are, it seems very likely we are headed toward a much leaner state and much more in the private domain. The Eurosceptic Right have had an unwitting ally in all this over the last six years – the cuts under the coalition were supposedly as bad as it could get, so people will ask, what’s the big deal about these post-Brexit cuts? The Left have cried wolf in other words on public spending.
The Left are also currently obsessed with further wolf crying in this area (declaring the current NHS a humanitarian disaster area), trying to push centrist Labour MPs out of office (with some success) and worrying about Len McCluskey’s career. Fiddling while Rome burns barely covers it.