• October 2016

Theo’s Blog: Forget Hard or Soft…It’s just Brexit!

October 1st was the 100th day since the UK woke up to the news that 52% of the Great British Public had voted for Brexit.  Seems a lot longer than that already!  I heard the news in the ITV Studios having been there throughout the night, contributing Paphitis pearls of wisdom on Brexit, which I must warn you, are sometimes worth exactly what the viewer paid for them….nothing.  Then the results unravelled, and even though I felt the electorate had got it right (not all for the right reasons) I couldn’t help but feel slightly unsettled and concerned; it was now down to our politicians to get Brexit right.  The Brexit die was cast. In the following few weeks I then wondered where Armageddon was, as guaranteed by David Cameron and the host of self-interested experts!  I predicted a shock to the system, the first of which we got pretty quickly on the night with the devaluation of the pound, as I said in my previous blog (“I’m Out…because I want to stay in”) and the first 100 days is always a good indication of impact.  But, if what we’ve seen is anything to go by I won’t be warming my hands on the embers of that fire and brimstone any time soon!

The shock to the system was indeed there, but it was swift, in the decline of the pound falling to a 31-year low against the dollar in the aftermath of the vote.  But, it has stabilised and recovered ground pretty quickly.  The decline in the pound isn’t all bad news though, as overseas shoppers are rushing to the UK to spend their money, with the Brexit boost set to take the West End spend to over £9bn this year.   People are certainly waiting for the other shoe to drop and for the unpicking of the staples of our British institutions to begin…but there does seem to be more and more chinks of light that are revealing that it was worth picking up that EU can now, rather than kicking it blindly down the road for years to come.   The run of positive press on how well the UK is performing couldn’t have been better written by the Vote Out campaigners.  Recent retail figures show that sales have risen in the UK and confidence is good. Inflation is unchanged, unemployment is still falling and the services industry showed unprecedented growth, the most in 20 years.  Those who made bold statements of recession and doom and gloom are understandably less vocal now.   Even Google’s most senior executive outside of Silicon Valley, has downplayed Brexit for the success of British tech companies, calling it a “local issue” encouraging the Government to support businesses’ global opportunities.  Hear hear!  Sadiq Khan is leading the way with his ‘London Is Open’, and it’s important to emphasise that the whole of the United Kingdom is ‘open’.  London is not the United Kingdom as the results of this referendum made abundantly clear.

When, during the campaign, Nigel Farage suggested a second referendum if the vote was close and for staying in, people laughed and I agreed with Cameron that it would have been a “never-endum”.  It seems now the shoe is on the other foot there are many Bre-mainers who are now pushing for the very same thing that they ridiculed.  You can’t have your cake and eat it boys and girls!

Many of the key players in the Remain campaign were left red-faced after the vote and their, frankly embarrassing, interventions from their ‘impartial’ seats of power!  Their credibility had more holes in than an out-of-the-EU Swiss cheese, and many are still lucky to be in their positions of power.  We waved goodbye, with not a wet eye in the house, to Cameron and Osborne, aka Brexit’s Punch & Judy, who left with their tails between their legs.  Gove and Johnson, despite being victors in their campaigns, turned on each other, walked 10 paces and both tried to land the first shot in a reputation-busting stand-off.  Et tu, Brutus?  Johnson was thrown a lifeline by the PM, and as Foreign Secretary, albeit without benefits, was bullish in his speech to the press that Article 50 would be actioned early 2017 as now confirmed by the Prime Minister and that deals would be done swiftly, perhaps not even taking two years.  More of this optimism please!

The Bank of England is putting on its elasticated trousers and working its way through a large humble pie, with Mark Carney, the Governor of the Bank of England head of the table.  His lack of impartiality was absurd during the Referendum campaign and it was right he was questioned by Jacob Mogg-Rees MP on whether he should have intervened in the campaigning so heavily for Stronger In.   When also interviewed recently by some school children, he said his toughest day in the job was dealing with the immediate aftermath of the Referendum result, well, I’m not surprised!  I suspect not least because he realised he was going to have to do a very public metaphorical moonwalk in backtracking.  And, lo and behold a matter of weeks later, he has even taken the credit for the relatively wave-free sail we’ve experienced so far.  Slow clap for Mark Carney, everybody, slow clap.

Leaving the worst til’ last…is Juncker.  Juncker, Juncker, the ever-delusional Juncker, who was obviously voted in overwhelmingly as the President of the European Commission.  Such a worthy representative, said no one ever.  Throughout Project Fear he just couldn’t help himself; throwing his euro’s worth in at every turn, with his World War One rhetoric, calling us deserters, which in the joined up EU approach was distinctly at odds with what the President of the European Parliament said a matter of days ago that we wouldn’t be treated as a deserter.  I suspect that all along Juncker, or “Druncker” if rumours be true, had his own agenda.  He is a dangerous man in a dangerous position, in fact I’d go one step further in that he is ironically THE biggest danger to peace.  I wouldn’t be surprised if he wanted the UK out of the EU all along, removing just one more barrier to his grand plans of a Federal Europe and a European Army.  The ability to veto these two issues is possibly my only regret in leaving the EU, but then again I’d have had to rely on our politicians doing the right thing and exercising that veto.

With the other strongest countries, France and Germany, perhaps taking their eye off the ball, focusing on their domestic elections next year, Juncker is rubbing his hands together in glee moving his chess pieces and trying to create his EU Army.  The same EU Army that David Cameron and Stronger In repeatedly rubbished the very idea of and very much at odds with Juncker’s announcement this month calling for an EU military headquarters to be set up, during his recent State of the Union address.    The Germans, French and Italians really need to get their crap together and vote for some major reform before being led into catastrophic conflicts as the Germans and Italians have in the past.  This Emperor has no clothes on and the sooner someone calls it the better!

In September, one of the many EU Presidents suggested that young Europeans are “voting with their feet” merely by using their Interrail passes.  That’s ludicrous! It has since been proposed that the EU youth will be gifted an Interrail pass on their 18th birthday at a cost of around £1.3bn a year, and that’s if only half take up the offer.  Surely addressing youth unemployment is a much higher priority.  What’s the point in a free pass for the likes of Greece where over 50% of its youth are out of work and have no money to spend on their travels anyway?  Juncker has said that “for the European youth, Europe means a better future”. Tell that to Greece, or Spain at 43.9% youth unemployment, Italy at 39.2%…the list goes on.
British politics has not seen anything like this EU Referendum and you wonder if we will again.  So far, we have avoided the Cameron, Osborne, experts predicted Armageddon and recession.  But let’s not all start celebrating quite yet.  We have a long way to go before we are out of the woods.  It is now for our government to show its mettle in negotiating our exit.

I have to say, I’m getting pretty well narked at hearing people talking about Hard Brexit and Soft Brexit – there is only one Brexit and that is, we leave the European Union and its laws and regulations and once again regaining our sovereignty,  by virtue of this we automatically lose the benefit of tariff-free trading with the EU.  We do not lose access to the European market, it’s just that we will have to live with tariffs on our decreasing goods exported to the EU, which by the way if you adopt WTO tariffs with the devaluation of the pound, will not make much of a difference.

The flipside to this of course is that if we then impose similar tariffs on goods coming to the UK from the EU, that really will make their exports expensive and thus has every chance of closing our deficit with the EU, unless of course once the sabre rattling stops, the Germans, French and Italians see sense and apply much more sensible tariffs to goods from the UK to the EU.  One thing I’m certain of though, is that it won’t be zero tariffs as that would require membership of the EU which we’ve now said we no longer want!  The other elephant in the room is of course immigration and free movement.  Whilst that in itself is a contradiction in parts of the EU, including the famously celebrated Schengen Area, which now has barbed wire and fences around it, I really find it difficult to visualise a United Kingdom without the vibrancy and diversity that immigration brings to our modern culture and workforce and if the United Kingdom is planning to grow and prosper it would be hard to do this without migrant workers.  Maybe we will be able to control quality but I very much doubt that the numbers will ever decrease to the tens of thousands wished by David Cameron.

May revealed her ‘hard Brexit’ plan to issue Article 50 before the end of March 2017, but although the “clarity” was welcomed by the likes of Tusk, he joined Merkel in rejecting her appeal for preliminary talks, creating a bit of a stalemate.  So…looks like it’s over to you May, Davis, Johnson and Fox; your country expects.

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