Tag Archives: brexit

a-Fisking we shall go – Captain Corelli’s Maudlin Rambling in the FT

So Louis Smart, or as he likes to call himself, Louis de Berniers, author of Captain Corelli’s Mandolin, has a rambling load of illconstructed reminisce as to why he voted to leave, in the FT. Its a doozy

Link here ; and a fisk below the line.

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Thinking about hard borders post brexit

As we move closer and closer to the purported Brexit end game, although never quite getting there like the paradox of Zeno, the pressure mounts on Ireland to save the brexiteers blushes.  Not just the UK media but elements within the Irish media have begun to mutter and muse on whether we should not perhaps, just perhaps, consider dropping the backstop, limiting it somehow, do SOMETHING to get Brexit over the line.

This would be foolish in the extreme. The backstop, let us recall, is an insurance policy. It kicks in if and only if other arrangements cannot otherwise be found that would keep a seamless border. Initially conceived by the UK as an arrangement for Northern Ireland alone, that was shot down by the DUP/ERG, fatally undermining the already tattered control of T May . We should have some sympathy for that position,  as it did and will partition a country along internal customs lines. But then, it was the desire of the country to be so partitioned, and despite the occasional outburst, NI is already distinct in law custom and practice from the rest of the UK.

 With the scuppering of the NI only backstop it then, at the request of the UK,  moved to the notion of a backstop for the UK as a whole. While this preserved the integrity of the UK from a internal trade perspective it enraged more than the hard right DUP/ERG as it, if implemented, would result in BRINO – Brexit In Name Only. So it too is no longer acceptable, it seems.

But, the argument goes, if we Irish keep this insistence on the backstop as an insurance policy we run the risk of a crashout no deal. Despite the fantasies of the wilder shores of Tory right wingers, the UK cannot even under WTO rules simply ignore its border. Nor can we ignore our obligations as EU members to police and protect what will be a border with a third country. So the backstop, it is said, will bring about the very thing it is designed to prevent. Why not then drop it in whole or part?

Doing so would require one of two things. Either we give a timelimit – that it will last X years and no longer, or that we would in effect ourselves depart from the EU single market. Lets look at these.

The most charitable interpretation of the UK approach to the negotiations is that they are at sea. But the other interpretation, one that has been given additional weight by recent revelations, is that they were not recently, or perhaps ever, negotiating in good faith. One does not have to be a brit-basher to have deep and profound misgivings as to the faith in which the UK negotiates. With a time limited backstop we would be negotiating alone against a larger party. There would be every incentive and it would be quite sensible for them to simply run down the clock, to stall, and then when the backstop expired look us in the eye and say “and?”. We would have no EU backing and we would have in effect “bottled it” in giving in on the backstop. So that would result in enormous pressure for the second, for us to depart in whole or part, but in fact, from the EU single market. We would be flouting EU rules and leaving open the EU external border and that would not be tolerated.   

This would be folly on the most enormous, unforgivable, egregious scale. Every indicator of economic progress in Ireland shows two major recent breakpoints. The first is the accession the EEC as it then was, and the second, and arguably more profound, the advent of the Single Market. Any weakening of our membership such as would be required were we to allow a semi-permanent open border with a non-EU member would be massivly dislocative. FDI would in all likelihood slow – while we can query our reliance on same and its composition the reality is we benefit greatly from companies using us as a fiscal or product bridgehead into the EU. Irish exports to the EU would at best face additional checks, at worse be seen as potentially contaminated by non EU components and thus decline. A reversal of the last 27 years of economic growth would be put in place because of our desire to keep an open border.

The government know this. They know that in a no deal we will have to protect the economic best interests of the state which is served by EU and SM membership. Any Brexit makes our economy somewhat weaker than otherwise. To compound this to spare what are in aggregate terms relatively small, relatively  unproductive regions or sectors would be economic insanity. Yes, additional checks and rolling customs will be of huge impact on border communities. Yes, it will harden further attitudes in the North. Yes, it will fuel further a narrative In the gutter press of the UK and the less than a fringe movement that is Irexit that we are poodles of the EU. But cold hard economic reality dictates that even if we lose 50k jobs from a hard Brexit that is the price of defending 100’s of thousands more that would be at risk from any weakening of our SM membership. That’s the harsh political dilemma.

a-Fisking we shall go : Ray “Bertie” Basset in the S*n

Every now and again, to remind us that there are worse comentators than Andrew Lillico, Ray “Bertie” Basset opines in some English newspaper. Today’s screed is from the S*n . No, I wont link to it. Google it.

Herewith a fisk,

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a-Fisking we shall go – Hugh Bennett in Brexit Central, again!.

Hugh Bennett (@hughrbennett) is the gift that keeps on giving. A rambling piece, devoid, nay utterly ignorant, of history and full of nonsequiturs and misdirection, his latest in BrexitCentral is a hodgepodge of jejune attempts at debating legerdemain, historical inaccuracies and whataboutery. So, standard Brexit stuff really

Read on. For an alternative, just as cutting, takes read here and here and here

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a-Fisking we shall go : David Raynes in Conservative Woman

Every now and again a piece of perfectly congealed boneheadedness comes along. Why do they come on a Friday from the brexstremists, making me fisk them when I should be heading for a beer? Anyhow, here we go, with a piece of internally inconsistent and condescending foolishness of note. So bad is it that the author knew, and allowed a sign, reproduced above, of a vandalised “welcome to NI” sign be its picture lede.  Continue reading

How badly hurt might Ireland be by a hard Brexit?

Another week, another report on the costs of a hard Brexit. Ireland, unlike the UK, has shown a willingness to engage in open and frank debate on Brexit costs. So, how much will it hurt?

The report from Copenhagen Economics, on Brexit, was the latest in a series – the ESRI, the government, the EU- that have shown the effect that Brexit will have on Ireland. The details differ in each case but the message is the same. Even the softest Brexit will have a negative effect on Ireland. In no way can it be seen as a friendly act.

A sense of perspective is needed, however. There has been some hysterical commentary about Brexit and its impact on Ireland. Some commentators have suggested that it could even be worse than the economic crisis of the mid-noughties. The effects are being presented as Ireland losing billions, being worse off etc.

This is , almost certainly, bunkum.

First, lets see what happened back in the crisis, for perspective. Then lets compare that to the most apocalyptic Brexit scenarios. That is a reasonable benchmark as the unreasonable, unreasoned, unhinged UK government approach is careering them towards a diamond hard Brexit. There remains some hope that the imbroglio that is Northern Ireland can act as a break on that, but that imples an outbreak of common sense and longterm perspective from the DUP, so lets not hold our breath.

Lets revisit the crisis. Lets define its acute phase as 2006-2013. Most of the main aggregate economic indicators peaked in 2006 or 2007 and most had bottomed out by 2011 or so. So how bad? Personal consumption of goods and services fell by 13% ; net spending by government on current goods and services fell by 15%; spending on capital formation (which includes but is not only houses) fell by a staggering 70% ; GDP fell by 16%, GNP by 15% and Gross National income by 20%. These are real, actual, cash losses.

Measuring by GNI the economy was €30b smaller in 2011 than it had been just four years earlier. Jobs were lost also. Employment peaked at 2.237m person in Q4 2007. By Q3 2012 it had bottomed out at 1.875m, nearly 18%, some 361,000 persons less in employment than just a few years before. Half of this fall was attributable to a collapse in construction employment but all sectors were hit. Government revenue also took a battering, even with the widening of tax bands and bases. Exchequer receipts fell 40% or more from a high of 16.5b in Q4 2007 to 9.7b in Q4 2009.

This was a real, hard, battering across the economy. The collapse of the economy in 2007-9 was stupendous. And it was real.

By contrast, the studies on the likely effect of even a diamond hard Brexit are cheerful reading. No study suggests a contraction of the economy. Instead what is forecast is that the economy will not be as large in the presence of Brexit than it would otherwise have been. A figure for this loss of potential output in the order of 7-9% is the norm across studies. This is also over a 10-15y horizon. even a diamond hard Brexit are cheerful reading. No study suggests a contraction of the economy. Instead what is forecast is that the economy will not be as large in the presence of Brexit than it would otherwise have been. A figure for this loss of potential output in the order of 7-9% is the norm across studies. This is also over a 10-15y horizon.

A figure for this loss of potential output in the order of 7-9% is the norm across studies. This is also over a 10-15y horizon. Let’s not even compare that to loss of actual output of 20% across a four year period.

A further wrinkle is on the sectoral impact. As the construction industry collapsed, taking with it the tax revenues it had generated, this rippled through the economy a a whole. Here , even in a hardest Brexit, the pain is spread, albeit not across all sectors. Five sectors – agrifood, pharma, electrical machinery, wholesale and retail and air transport-will account for over 90% of the effect of Brexit on the economy. The two biggest hit are agrifood and pharma with Pharma being in fact the hardest hit. A key distinction here is that Pharma is a much less labour intensive industry than agrifood. Thus the labour market impact of Brexit will be in effect concentrated in one sector –the agrifood sector.wholesale and retail and air transport-will account for over 90% of the effect of Brexit on the economy. The two biggest hit are agrifood and pharma with Pharma being in fact the hardest hit. A key distinction here is that Pharma is a much less labour intensive industry than agrifood. Thus the labour market impact of Brexit will be in effect concentrated in one sector –the agrifood sector. even here we are talking about slower growth over a long time than actual contraction over a short time. Must of this comes from reduced UK exports and most of that from non trade barriers in an hard Brexit. Anything which sees the UK remain close to a Norway or Swiss style deal reduces the effects to margin of forecast error levels.

Paradoxically this makes managing it harder in some ways. When the whole country is going to hell in a handbasket the state can make the broad changes needed. When it is only one sector that sector will need to be extremely vocal and also extremely nimble. Although the agrifood sector has been reducing its dependence on the uk over the years the reality is that this has not taken place at the same pace as the economy overall. Brexit represents a shock to the core of the irish agrifood system but as it is happening it needs to be taken as an opportunity. There are good government plans in place, in contrast to the UK continued reliance on hope and hype, but these can only go so far. At the end, the participants in the sector need to drive their products to other, more lucrative but more difficult markets.Brexit represents a shock to the core of the irish agrifood system but as it is happening it needs to be taken as an opportunity. There are good government plans in place, in contrast to the UK continued reliance on hope and hype, but these can only go so far. At the end, the participants in the sector need to drive their products to other, more lucrative but more difficult markets.

Brexit will hurt. It is pointless, and heedless. But it seems that the UK is intent on it. We are blessed with a functioning, competent political and governance system that will mitigate as much as possible the effects of this homegrown act of sociopolitical pique by our neighbors. The economywide effects will be slower growth not actual contraction. Placed in that context the notion that we would consider exiting the EU alongside the UK becomes even more delusional.

This is a longer version of an Irish Examiner column 19/02/18

a-fisking we shall go: Graham and Robert in Brexit Central

So two academics have taken to the unbiased and calm waters of Brexit Central to opine. They tie themselves in rhetorical knots Gordius would be proud of in trying to argue for their position while decrying academics who argue other. Its funny. And fisked.  Continue reading