Before the EU referendum, I predicted that if the country voted Leave, the Tories would do one of two things. Either take us out of the single market and try and remodel the country as a low tax, small state neocon paradise; or they would curl up into a foetal position and beg for mummy. So far, the second thing seems to be winning the day.
They still might pluck themselves up and go for the Singapore off the coast of France deal, but at present they seem to lack the cojones. Which is good for all us, I’d like to add here. Given that cluelessness has set in amongst the new top ranks of the Conservative Party, what will actually happen next is worth exploring.
I think there are two possibilities. One, the whole thing drags on and on and on, with everyone terrified to push the Article 50 button. What happens at the end of that, I have no idea. Two – and this is the more likely thing, I believe – we agree an EEA deal with the EU.
For a while, I figured an EEA deal was off the table and thus discounted it as a possibility. The European Commission announced it was a non-starter, and Cameron said it wasn’t something he thought we should do if we voted Leave. But the EU didn’t actually think this was going to happen, so they will probably be willing to reconsider (under circumstances I will outline in the next paragraph). Cameron, meanwhile, is no longer a going concern in all of this. And Dan Hannan is right when he says that the Leave side never promised to rule out a Norway deal. They promised £350 million a week for the NHS, as a for instance, but they never explicitly ruled out remaining in the EEA.
Crushed by uncertainty, I can imagine the UK government biting the EU’s hand off for an EEA deal. Stability would be restored quickly as a result. It would come at a price, however: my bet is that we’d end up having to pay more into it as an associate member than as a fully fledged one. Now imagine all that happening for a moment. The Leave campaign promises to stop sending money to the EU and halt immigration. Instead, freedom of movement stays in place and we then end up sending MORE money to the EU than before. The outrage will be hard to imagine.
The likely beneficiaries are Farage and UKIP. Despite being the main factor in the whole thing happening in the first place, UKIP are not in charge of cleaning up the mess. They can pretend to the Leave masses that they would have done a much better job had they been running the show – none of that money to the EU bollocks and doing nothing about immigration! Farage could become the UK’s version of Trump very quickly. With former Labour voters plumping for Leave in large numbers in the north of England, UKIP could clean up.
The Conservative Party are in real trouble, even if in the short term they are almost certain to form another government. All the problems are medium to long term – but when they hit, they will hit big time. No extra money for the NHS – much more likely, cuts in its budget on their way, in fact. Immigration precisely the same. All of that combined with an overall – now necessary – cutting of the state combined with tax rises. I don’t see how the Tories will survive all of that. Even with Labour in meltdown at the moment, someone will rise up to present a credible alternative. My worry is that we could be left with only Nigel Farage and UKIP standing.
Nick, good blog as usual!
Does membership of EEA require free movement of people or free movement of labour? I think this could make a big difference in the negotiations and how it is presented to the British voters.
Most of the people who voted leave expected immigration to stop and people who are here to be asked to leave, Gove Johnson and Farage have given us racist England, They are now back peddling on their promises, they were only suggestions, we will finish up with a Norway style deal, it will cost us more to be in and we will have no say in how it is run, So what was the point,
I think the Norway deal includes Schengen as well as free movement.
The best deal is, in fact, the one we have today (all the above including a vote/veto at the Council table), or even better Cameron’s negotiated new deal – which we just rejected!
The Ideal way forward now is a General Election, praying for a government new Remain mandate, and NO Article 50, EVER.
Michael Fuchs has suggested there might be a deal to be done on free movement, though not the financial cost of access to the single market. Easy to see why Germany might find limiting the cost to the EU budget of Brexit attractive (as it would be expected to pick up most of the shortfall). Limiting free movement to those who have job offers would allow Boris and Co to shout about their great victory over benefit tourists while making no great change to actual numbers. A nice EU compromise?