Brexit discussion thread IX (Please read OP before posting)

Zubeneschamali

Bit cynical wrote: »

Remember we are talking about the no deal scenario where it is not a case of moving talks forward. The talks have failed and the UK has exited without a deal. There are no existing talks to move forward.

If the UK are OK with there being no talks in future, the EU may have to hit them with punitive tariffs until they cough up what they have already agreed they owe.

Professor Moriarty

Zubeneschamali wrote: »

For context, Ireland has added 200,000 jobs since mid 2016, so that would be maybe a years, year and a halfs employment growth, not the end of the world.

Not the end of the world if you don't lose your job or your business.

Zubeneschamali

Professor Moriarty wrote: »

Not the end of the world if you don't lose your job or your business.

In an economy with essentially full employment, it is not the end of the world even if you do.

kunst nugget

Bit cynical wrote: »

How would the EU take the UK to court? The UK only owe that figure if it is part of a negotiated agreement. In the case of no deal there is no agreement.

That figure is based on commitments the UK had already made up to 2020. It can refuse to pay it but the EU have already said such an action would be considered a sovereign default by financial markets and Moodys have said that the UK's credit rating would be severely affected by such a decision. That would be an absolutely terrible position to put yourself into.

https://theconversation.com/boris-johnsons-threat-to-not-pay-britains-brexit-bill-is-dangerous-for-the-uk-economy-118544

Professor Moriarty

Bit cynical wrote: »

But no court would be involved unless an agreement had been reached that was then subsequently broken by one or other of the parties.

It's irrelevant. The UK needs to trade with the EU. No discussion will take place until the bill is paid.

Dytalus

Professor Moriarty wrote: »

Payment of 39 billion would be item Number 1 on the agenda for any future FTA discussions before, during or after a crash out.

Absolutely. Followed quickly by item number 2: the backstop.

Which is why not signing the WA is a fool's errand. Ireland will be hit very hard by a crash out, but we will have the backing and assistance of one of the most powerful economic forces in the world. And the EU wouldn't even have to go out of its way to help out. EU funding rates are assigned based on the economic performance of each member state. If our economy tanks, then we'd slide into a lower bracket and automatically get more funding. No rules bending, no special treatment. Just the EU doing one of the major things it does - help to prop up its weaker members.

The UK, though? They'd crash out with almost no trade deals. New ones can take up to a decade to complete, and even longer to have any appreciable effect. They would have nobody propping them up, and a very unhappy populace in two of its four members.

My money is on the UK bending before Ireland or the EU does. And then they'll have to sign to the very things they refuse to agree to now - and they'll have to do it after taking an economic hit. I cannot reasonably see a winning move for them that isn't singing the deal in front of them.

Robert McGrath

Bit cynical wrote: »

How does it work in your opinion?

I think everybody believes that the UK does envisage some contact with the outside world after Brexit and would prefer not to be the North Korea of the West

Professor Moriarty

Zubeneschamali wrote: »

In an economy with essentially full employment, it is not the end of the world even if you do.

80000 jobs will be lost. The economy will take a hit of 100 billion over 10 years. There will be a 6 billion hole in public finances. Quite simply, there won't be other jobs for these people to take.

Bit cynical

Professor Moriarty wrote: »

It's irrelevant. The UK needs to trade with the EU. No discussion will take place until the bill is paid.

However there will be trade. Not on as favourable terms for either side as at present but there will be trade.

Professor Moriarty

Dytalus wrote: »

Absolutely. Followed quickly by item number 2: the backstop.

Which is why not signing the WA is a fool's errand. Ireland will be hit very hard by a crash out, but we will have the backing and assistance of one of the most powerful economic forces in the world. And the EU wouldn't even have to go out of its way to help out. EU funding rates are assigned based on the economic performance of each member state. If our economy tanks, then we'd slide into a lower bracket and automatically get more funding. No rules bending, no special treatment. Just the EU doing one of the major things it does - help to prop up its weaker members.

The UK, though? They'd crash out with almost no trade deals. New ones can take up to a decade to complete, and even longer to have any appreciable effect. They would have nobody propping them up, and a very unhappy populace in two of its four members.

My money is on the UK bending before Ireland or the EU does. And then they'll have to sign to the very things they refuse to agree to now - and they'll have to do it after taking an economic hit. I cannot reasonably see a winning move for them that isn't singing the deal in front of them.

I agree. The only danger is the lunatics have taken over the asylum and there might not be enough sane people to stop them. The Tories are drunk on populism and could force this through just because they can.

Professor Moriarty

Bit cynical wrote: »

However there will be trade. Not on as favourable terms for either side as at present but there will be trade.

On WTO terms? I wish the British economy the very best with that.

Bit cynical

Dytalus wrote: »

Absolutely. Followed quickly by item number 2: the backstop.

I think what will surprise a lot of us here is how quickly what was discussed in the WA negotiations will be forgotten in the event of no deal. The border, for example, however it is implemented, will just become the established norm.

WomanSkirtFan8

Professor Moriarty wrote: »

Corbyn is simply unelectable.

Yep. He's the absolutely wrong leader for the Labour Party at this critical juncture. He could have made so much more political capital out of this whole sorry fiasco and he hasn't. Worse than a failure IMHO.

Bit cynical

Professor Moriarty wrote: »

On WTO terms? I wish the British economy the very best with that.

It is still trade. I think some of us here are imagining that after the UK leaves there will be literally no trade with Ireland or the EU.

listermint

Bit cynical wrote: »

It is still trade. I think some of us here are imagining that after the UK leaves there will be literally no trade with Ireland or the EU.

Cant tell if you are serious.

Squints eyes....



Yes i think they are actually being serious.

Leroy42

Bit cynical wrote: »

I think what will surprise a lot of us here is how quickly what was discussed in the WA negotiations will be forgotten in the event of no deal. The border, for example, however it is implemented, will just become the established norm.

And what benefit is there to the UK to have a border in NI? The UK were the ones that came up with the backstop idea, precisely because they understood the impact of a border.

The EU agreed to put aside it rules on the basis of the GFA and peace and also because NI makes up such a small amount of trade in relative terms.

So the UK drop out without an agreement. They go back to the EU looking for a trade deal (which everyone agrees they will be doing) what do you think the EU will be looking for?

The UK will already have zero tariffs, or else WTO crippling tariffs. But the main difference is that the EU can source most UK things from within the EU at zero tariffs, whilst the UK will have to pay tariffs. So not only will the export economy be decimated, but the imports will either be massively more expensive or wipe out the indigenous industry.

All to save £39bn (which is actually smaller now as they have delayed and as such continued to pay into the EU during the time)

Bit cynical

Robert McGrath wrote: »

I think everybody believes that the UK does envisage some contact with the outside world after Brexit and would prefer not to be the North Korea of the West

Let's be realistic here. The UK will take a significant economic hit after Brexit but it will not become North Korea. It will be less of a hit than Ireland took in the financial crisis. Ireland will take a similar hit but again it will be less than we took in the financial crisis.

As for reputational damage, yes, if the UK had agreed to pay 39 billion as part of the WA and then refused to do so, it would take a reputational hit. But I think we're forgetting that this figure only arises as part of the deal. In the event of no deal there is no WA. The UK owes nothing if there's no deal.

Professor Moriarty

Bit cynical wrote: »

It is still trade. I think some of us here are imagining that after the UK leaves there will be literally no trade with Ireland or the EU.

There will be trade. But Britain will be competing for EU trade under less favourable terms than 60 other countries. Here's an important fact to illustrate how mad No Deal is. If Britain were to start trading under WTO rules only on Nov 1st, which is what they would have to do if they crashed out, they would be the only country in the world to be doing so.

Leroy42

Bit cynical wrote: »

The UK owes nothing if there's no deal.

Wrong. The UK have simply agreed on the figure and the payment plan under the WA. No deal still leaves the money payable.

Do you understand what the payment is for? It is not a cost to leaving. This is money that the UK would be paying whether they stay or go. The EU wants it in the WA so that it cannot be used as a pawn in any FTA. And it appears they were 100% right to take this approach as clearly the UK have every intention of using it as such.

It is the same as settling a bar tab at the end of the night.

Sure, you can leg it, but try getting back in the next night.

Bit cynical

Professor Moriarty wrote: »

There will be trade. But Britain will be competing for EU trade under less favourable terms than 60 other countries. Here's an important fact to illustrate how mad No Deal is. If Britain were to start trading under WTO rules only on Nov 1st, which is what they would have to do if they crashed out, they would be the only country in the world to be doing so.

Yes but I am not advocating no deal. Both Ireland and the UK are better off economically if there's a deal.

But from the UK's perspective, a large part of the attractiveness of the WA is continuity. While negotiations for the future relationship is ongoing, the UK gets to trade on much the same basis as it was doing as an EU member.

However in the event of no deal, this continuity is lost. It is gone and cannot be brought back. Now they are outsiders. They expect economic hardship - there's been no shortage of doom and gloom forecasts in the press - and they will get it and there will indeed be some political pressure to come crawling back to the EU in humiliation, but there will also be a desire to get on with the task of rebuilding the economy and negotiate trade deals with the rest of the world.

So I don't think it is as simple as saying that because the UK will suffer economically they will immediately come back with their tails between their legs looking to reopen the WA.

Panrich

Leroy42 wrote: »

Wrong. The UK have simply agreed on the figure and the payment plan under the WA. No deal still leaves the money payable.

Do you understand what the payment is for? It is not a cost to leaving. This is money that the UK would be paying whether they stay or go. The EU wants it in the WA so that it cannot be used as a pawn in any FTA. And it appears they were 100% right to take this approach as clearly the UK have every intention of using it as such.

It is the same as settling a bar tab at the end of the night.

Sure, you can leg it, but try getting back in the next night.

Exactly. As an example there are very many retired British citizens who served in official capacity for the EU over the years. The EU will continue to pay their pensions.

Professor Moriarty

Bit cynical wrote: »

Yes but I am not advocating no deal. Both Ireland and the UK are better off economically if there's a deal.

But from the UK's perspective, a large part of the attractiveness of the WA is continuity. While negotiations for the future relationship is ongoing, the UK gets to trade on much the same basis as it was doing as an EU member.

However in the event of no deal, this continuity is lost. It is gone and cannot be brought back. Now they are outsiders. They expect economic hardship - there's been no shortage of doom and gloom forecasts in the press - and they will get it and there will indeed be some political pressure to come crawling back to the EU in humiliation, but there will also be a desire to get on with the task of rebuilding the economy and negotiate trade deals with the rest of the world.

So I don't think it is as simple as saying that because the UK will suffer economically they will immediately come back with their tails between their legs looking to reopen the WA.

So if they don't come back to the EU looking for a deal, what will their economy look like under WTO rules only?

Zubeneschamali

Professor Moriarty wrote: »

Quite simply, there won't be other jobs for these people to take.

Of course there will be other jobs: Ireland has added 350,000 jobs since 2014, 70000 jobs a year.

Bit cynical

Professor Moriarty wrote: »

So if they don't come back to the EU looking for a deal, what will their economy look like under WTO rules only?

Well there have been economic forecasts for different kinds of Brexit and like I said, the economic hit is significant for both the UK and Ireland but somewhat less than Ireland suffered under the financial crisis.

Leroy42

Bit cynical wrote: »

Yes but I am not advocating no deal. Both Ireland and the UK are better off economically if there's a deal.

But from the UK's perspective, a large part of the attractiveness of the WA is continuity. While negotiations for the future relationship is ongoing, the UK gets to trade on much the same basis as it was doing as an EU member.

However in the event of no deal, this continuity is lost. It is gone and cannot be brought back. Now they are outsiders. They expect economic hardship - there's been no shortage of doom and gloom forecasts in the press - and they will get it and there will indeed be some political pressure to come crawling back to the EU in humiliation, but there will also be a desire to get on with the task of rebuilding the economy and negotiate trade deals with the rest of the world.

So I don't think it is as simple as saying that because the UK will suffer economically they will immediately come back with their tails between their legs looking to reopen the WA.

But there is no analysis, forecast or anything on how they are going to replace the lost trade. Never mind the massive hit in the short term that will happen regardless.

It is not simply political pressure, people will lose their jobs. People will lose their homes. Companies will close down. And at least the 2008 crash could be blamed on the US, or the banks. This is going to land directly at the feet of Johnson and Farage. What is Johnson going to do to help these people?

And how will they handle the inflation? If NI is effected even close to the forecasts will England be happy to increase the subvention to cover it. And what about the costs of setting up all the trade bodies, regulation offices, additional customs checks, vet services?

And will other countries be willing to lend them money given they have just whelced on money owed to the EU simply because they didn't feel like paying?

Hurrache

In another one of those you couldn't make it up moments, Alan Mendoza, executive director of the Henry Jackson Society, a conservative think tank that tries to position itself across the divide and claims to "work across borders and party lines to combat extremism, advance democracy and real human rights" had this to say about how to deal with Ireland.

Someone needs to have a whisper in his ear and tell him where the opposition to the backstop is coming from.

https://twitter.com/DarranMarshall/status/1149671033646927872

edit:

This one was the reaction from the Daily Mirror editor in it.

https://twitter.com/lumi_1984/status/1149678401042731008

Bit cynical

Leroy42 wrote: »

Wrong. The UK have simply agreed on the figure and the payment plan under the WA. No deal still leaves the money payable.

Do you understand what the payment is for? It is not a cost to leaving. This is money that the UK would be paying whether they stay or go. The EU wants it in the WA so that it cannot be used as a pawn in any FTA. And it appears they were 100% right to take this approach as clearly the UK have every intention of using it as such.

It is the same as settling a bar tab at the end of the night.

Sure, you can leg it, but try getting back in the next night.

I think you are incorrect. As pointed out there's no legal obligation to pay that money in the event of no deal. It is not like a bar tab where there's a legal obligation.

Zubeneschamali

Bit cynical wrote: »

Well there have been economic forecasts for different kinds of Brexit

The last No Deal estimates I saw were 7.7 to 10.7% lower GDP after 15 years compared to Remaining.



https://www.theguardian.com/politics/2018/nov/28/uk-significantly-worse-off-under-all-brexit-scenarios-official-forecast-gdp

Professor Moriarty

Zubeneschamali wrote: »

Of course there will be other jobs: Ireland has added 350,000 jobs since 2014, 70000 jobs a year.

No there won't. It's -80000. Not -80000+80000=0. If you lose 80000 jobs then you lose 80000 jobs. The economy will be hammered for years so new jobs won't be coming anytime soon.

Leroy42

Bit cynical wrote: »

I think you are incorrect. As pointed out there's no legal obligation to pay that money in the event of no deal. It is not like a bar tab where there's a legal obligation.

That is exactly what it is. TM has stated that in the HoC. The likes of JRM etc have dressed it up as a divorce bill, a price for leaving, but it is simply false.

They owe money as part of the agreed projects within the current budget. Bridges, for example, are currently being built that UK will be part funding. Should they simply be allowed to stop paying now?

As mentioned, peoples pensions (Farage for example) have to be paid for a number of years. That is part of it.

I think you misunderstand what the 39bn relates to.