Red Cliffs Of Dawlish

Red Cliffs Of Dawlish
Red Cliffs Of Dawlish

Wednesday, 13 July 2016

FLEXCIT: Dance, Dance, Dance.

This beautiful picture shows two people dancing a beautiful dance.

Some years ago I had the opportunity to learn some dance, and perhaps not very good, but at least I learnt that it is a careful choreography between two partners and obviously they have to respond and interact to the music and each others moves to be able to dance well. Much easier said than done (!) though very very enjoyable when the odd successful routine is achieved.

I've said it before and will say it again, too often on television when you have a politics question and answer it's like watching the most fucking aweful dance routine possible!!!

Well, fortunately for one day, the conversation and question and answer session on a particular aspect of Brexit was conducted and it was "moderately good"!

The UK’s future economic relationship with the European Union

Witnesses: Hosuk Lee-Makiyama, Director, European Centre for International Political Economy, Shanker Singham, Director of Economic Policy and Prosperity Studies, Legatum Institute, and Richard North, Author

Look Closely: A copy of FLEXCIT: The Market Solution on the far RHS of the table.

The above screenshot is at the end of the 2 hours session and it was quite technical and complicated and in my opinion the problem was that the questioners must have been struggling to understand the answerers: Namely the "dance" was perhaps one-sided to use the metaphor above. Secondly I think the actual "dance" went very far very often away from the actual "beat of the music" ie relevance loss again probably because the questioners had a set number of questions and were in formality mode of going through those without really understanding the answers received beyond probing where they could their own set criteria? Just imagine one of the dancers going through the set moves without the blindest bit of awareness to the rhythm of the music! Well that was the impression I took from the questioners; the answerers were overall very good.

I use the metaphor of dance because even though it is technical and complicated, I am guessing there is a dance going on here that could be described in addition to pointing out the disparity above. For a more descriptive observation of the meeting Pete North fills in here: Treasury committee: first thoughts.

I read a lot of comments over at and they seemed to generally think that Hosuk Lee-Makiyama was overly negative and indeed it may appear that way. Whereas in general Shanker Singham seemed positive. I'll come back to Dr. North in a moment.

First as Pete North points out, it was quite an important meeting considering it covered ground in 2hrs that was never covered correctly in the entire Referendum campaign. We managed to remove from Brexit:-
  • WTO Option (unilateral fall-back)
  • FTA Alternative to Single Market Membership
I think I'm right in asserting both these options were completely eliminated? Goodbye, don't come back, the end!
"The general impression from the whole panel is what we said from the outset. CETA and WTO options are completely out there. For the birds. And though the expertise we heard today was extremely valuable in adding to our understanding we still see a Déformation professionnelle at work as our trade experts tend only to look at it from a trade perspective, neglecting to take into account, defence, cooperation programmes, aviation and the rest of the EU institutions."
It may have worked in the EU Referendum Campaign (how?!) to have multiple different voices all advocating different Brexit plans so that all "Leave" voters and potential such voters would "hear what they wanted to hear"? I don't know, but right now we can now all agree that most of those voices were talking complete and utter bullshit. If you signed up to any of those, you might want to reconsider how you choose to trust or assess information when you make decisions for yourself.

Now looking at Pete North's quote above we can come back to Dr. North and that last bit after Déformation professionnelle this is what is fascinating: Dr. North was at incredible pains to point out and stress just how challenging and potentially difficult withdrawal of the EU will be: The arch "eurosceptic or brexiteer" talking up the EU Institutions and their particular competencies, their particular requirements and such like. You know it sounds to me like we have a real expert talking here... .

As for the other two experts, I have to disagree with the commentators impressions over at I think Hosuk Lee-Makiyama was almost coded in his careful demolition of both the WTO and the FTA (CETA) options and only obliquely alluding to EEA+ via pointing out that EEA- would likely be a bridge too far while EEA+ would "NOT SAVE MONEY" (actually fitting in with the title of the session about the economics of Brexit (something of a dubious quesiton imo in the first place). As such far from merely being a "problemator" (creator of problems) I think his negative appearance was very useful!

Whereas the positive trade negotiator perspective of Shanker Singham, I found overly descriptive of "in principle there's positive to be had" as opposed to "in application to the present conditions we perhaps need to tread carefully": It seems to me that there was great effort to point out the opportunities here and commercial imperative that would mostly likely drive the process, but this was all hinged on the assumption of an "EU Deal" being more of a formality to subsequent opportunities. In fact I found a distinct lack of structure though the content of what was said was certainly of high quality regarding the subject. Namely I'd argue here was someone who knew the moves but it seemed not so with the music. Having experience in trade deals, I'm sure there will be a place for such expertise and reading the Civil Service World website says they're desperate for such people who can bring their previous experiences and apply them and hence I'm sure give confidence and goodwill to all ("common interest" as Mr. Lee-Makiyama puts it).

As to the questioners, The Chair seemed most useful in his questions but did not chair the discussion I feel adequately for the entire course (a big challenge tbh it seemed); I'm not sure he was able to "ask the right questions" ie he did not "know the moves" well enough. But the rest of the questioners seemed to me to be completely out of their element. I mean really, really, really (!) poor and not able to maximize such a useful opportunity.

Interestingly enough, even though Dr. North was insistent on the challenges, as to the actual question of the economics, "any final contributions" had Dr. North mentioning "Trade Fascilitation" and the very real monetary benefits possible via this discussion... . This seems like a very solid and concrete contribution but with the cautionary privisio of our "Treaty obligations" and the magnitude of political change required to be undertaken - first.

Finally I'd like to contribute something myself that I think will help future discussions of Brexit:-

Firstly there's a lot of variable "relationships" with the EU. But crucially for the UK to quote FLEXCIT: The Market Solution, with "nine treaties and over 40 years of convergence" with an almost "unique degree of convergence required" with the Supranational EU as per the Treaty requirements ie concerning the acquis communautaire "swallow the lot and swallow it whole": When it comes to withdrawal from EU Treaties ie exit away from such convergence politically, legally, monetary and economically, it has to be reduced to 3 options and now 1 option after this meeting: EFTA/EEA of some variable composition eg EFTA/EEA and UK/EEA+. But that will Stage 1 axe for sure monetary, legal and political aspects while securing that commercial and economic... namely you guessed it: Once you boil down the actual possible solutions you see the logic of FLEXCIT emerging all by itself and I could go on to list as per the previous blog's introduction all over again the correct sequence of moves in time to the correct beat!

Finally The Chair of the meeting did try to probe concerning the idea of freedom of movement of labour and single market membership or else FTA (which we can thank Hosuk Lee-Makiyama for shooting down with his ellided but quite precisely pressurized statement that he did not think the UK was ready for such a "high societal cost" even if technocrats would be!). This comes back to the idea of the EU as Treaty in the process of designing a Supranational governance or to use the visual picture again, to develop a form of integration that converges nations so closely in so many areas to such a high degree as compared to other forms of "Trade Deals" (see Dr. North's (or Mr. North...) contribution that was extremely useful at the meeting here for retrospective: EU Referendum: no such thing as free trade) .

Namely we're back to dancing to FLEXCIT's beat again, we have to accept Freedom of Movement of Labour in the short-term if we are to be Single Market members (not merely FTA access to it outside it). In fact the Trade expert Shanker Singham (usefully) pointed out as such convergences get closer to incorporating more "sectors" such as services then these matters of employment and hence labour do become more involved in such relationships... an example of this was provided in financial services by Hosuk Lee-Makiyama on the loss of "safe harbours" (it's not something I'm personally familiar with!) for US workers from the EU. Curiously he did not seem to believe the timing issues under Article 50 of the EU Treaties stating 2 years would be very relevant: If there's one detail that needs to be prioritized I'd back up Dr. North's suggestion of requesting an extension with a view to notification of the EU of Article 50 by the UK if requested to do so sooner than later.

Afterall, we do not want to put a foot wrong in this very complex and very challenging process.