Brexiteers Davis and Johnson Abandon May’s Soft Brexit

Major Resignations in Theresa May’s Government

Over the past 24-hours two senior officials in Theresa May’s government have resigned due to differences in what kind of Brexit each seeks.

And frankly, it’ll be a blessing. Far less paint will be peeled off the walls each week at 10 Downing Street, if you catch my meaning.

Even though both David Davis and Boris Johnson were and are strong proponents of Brexit (which Prime Minister Theresa May also claims to be) governing the country becomes an impossible task when three people fight each other daily to steer the ship of state.

Every Prime Minister must tolerate some division within the party caucus to be sure. Less so, but still important is to allow a variety of views within Cabinet so that it doesn’t become a sterile place where ideas go to die. But there comes a point when too much division becomes the main issue — instead of the people’s business being the main issue.

Which is why it’s important Theresa May stuck to her guns and didn’t make any last-minute deals (of a kind that a lesser PM might have made) to keep the crew together. Not that Davis and Johnson are going anywhere as they’ll remain Conservative Party backbenchers.

Certainly, Margaret Thatcher would’ve told Davis and Johnson to ‘go fish’ some time ago and probably would have physically evicted them from the room. 😉 (You never knew with Maggie!)


Whether You Agree with Davis and Johnson or Not, this Streamlines Whatever Brexit Modality Theresa May Pursues

While some would like the strongest possible Brexit — Britain’s future will be better with a Brexit agreement that doesn’t ruin relations with the EU, one that includes some kind of reasonable free trade deal, one that allows the UK and the EU to cooperate on a wide range of issues such as, but not limited to; A common rulebook where and when feasible, the Galileo project, the ECJ (where UK courts would include, but not be limited or bound by ECJ rulings and opinions) NATO, and agreeable relations or even membership with other important European institutions.

Theresa May’s sole goal (it seems) is to get a deal with the EU. Which is a noble goal in itself.

The flip side of that is when the agreement Theresa May intends to present is so diluted that her Cabinet walks out the door. Yet, the Prime Minister may still be proven right by events yet to unfold.

It’s obvious to all but the most politically tone-deaf that no matter what agreement is presented to the EU mandarins, it is likely to be swiftly rejected. Including Theresa May’s super-diplomatic, uber-polite and overly-soft Brexit proposals.


But if That’s the Case, Why Try at All?

As an experienced bureaucrat slogging it out in the Home Office for a decade Theresa May knows something that hardcore Brexiteers don’t. And that is, those who get ‘stuck with the bill’ wind up paying many times over.

Let’s look at three scenarios, and let’s see who gets stuck with the bill:

  1. Hard Brexit faction presents an uncompromising Brexit deal to the EU: The European Union declines the deal offered and the blame is on Britain ‘for being so unreasonable’ and from that point on… every single thing that ever goes wrong in Europe, the World, and the Solar System… will be the fault of *those* unreasonable Brexiteers. And it’s not that EU people are evil, it’s just human nature to feel that way when jilted.
  2. Soft Brexit faction presents a soft agreement for signing in Brussels which is accepted by the EU: It’s seen as a ‘Win-Win’ for both sides. But the EU ‘wins’ by a slight margin and when you’ve effectively ‘dumped your partner’ sometimes it’s a good thing to let them ‘win’ a little bit. The worst that can happen in such a case is that the next UK Prime Minister will try to improve the deal and may or may not succeed in that endeavor. Likely, as time rolls on, both sides will arrive at a better agreement and both can claim credit with their respective voters for any future agreements. Not a bad scenario at all.
  3. Soft Brexit faction presents a soft agreement for signing in Brussels which *isn’t* accepted by the EU: At that point, the British can walk away from the table knowing in their hearts and with the whole world as a witness that they ‘tried their best’ to accommodate the concerns of the people in Brussels but they just couldn’t strike a deal. (A sort of ‘no fault’ divorce) And Brexit proceeds on a WTO-style basis with a flurry of à la carte agreements signed following March 29, 2019 allowing EU cars to be sold in the UK and UK airlines to operate over continental Europe, for two examples.

In scenario #1: Britain and the Hard Brexiteers get stuck with the bill for about the next century. Maybe longer. ‘Those intransigent Brits! A bloody difficult people they are!’

In scenario #2: Britain gets stuck with the larger part of the bill and in the following years must work incrementally towards the final Brexit arrangements they were originally seeking. ‘Damn, Theresa, couldn’t you do any better? Oh well, we got a Brexit of sorts, you’re forgiven.’

In scenario #3: The EU gets stuck with the bill and the world decrying EU intransigence. And Theresa May *probably* gets re-elected in a landslide.


Summary

The lesson from this story is that when the chips are down and you *must* bring home a win *always* go with the plan that is *guaranteed to work*.

Which in the real world often isn’t the most glorious, most exciting, nor the most popular plan. Unfortunately.

But when a plan works, it’s a win. And beautiful or ugly, if the plan works that’s all that matters.

Written by John Brian Shannon

Theresa May’s New Year of Hope

As far as years go, UK Prime Minister Theresa May must be glad to see the end of 2017 as are many others in Britain and around the world. In matters Brexit, it was a year of low-level chaos and unfulfilled expectations — lots of ‘churn’ but not much actual progress.

Yet the Prime Minister did make some exceptional speeches and unexpectedly reached-out to EU citizens to assure them that while Britain was leaving the European Union, it wasn’t leaving Europe. Well done on both counts, Theresa May.

She also told EU citizens living in the UK that their situation wouldn’t change, aside from having to register their residency with the Home Office and pay a nominal fee to retain their ‘settled status’. And while that didn’t seem to impress small numbers of EU negotiators, it brought great comfort to millions of expats living in Britain.

Of course, it’s all contingent upon reaching a final ‘Withdrawal Agreement’ between the United Kingdom and the European Union, but it’s not too much of a stretch to suggest that the UK would act unilaterally to guarantee the rights of EU citizens working or studying in Britain in the case of no agreement.

Theresa May also offered £40 billion of UK taxpayer money to the European Union; Everyone is unclear what this is for, as nobody from the government has bothered to explain it to citizens.

Many people think that the UK’s share in the EU Parliament buildings and in other EU properties and assets should be sold off to the other EU27 members and the £9.65 billion (estimated) value could be used to pay future UK liabilities to the EU and that there is no need to pay £40 billion. Which seems reasonable.

If there is an actual need for the UK to pay £40 billion to the EU, surely British taxpayers have the right to know what they’re paying for, and to whom.

But if Theresa May has agreed to continue paying the £8.6 billion annual net payment to the European Union until Brexit completes within 2 years (approximately) plus 2 more years to cover the transition period, then that seems pretty reasonable too. If that’s how the £40 billion is being arrived at, there’s not much to complain about there.


With all this reasonableness going ’round it’s no wonder EU negotiators agreed to move to Phase II of Brexit negotiations — trade — a hyper-important part of the post-Brexit relationship on both sides of the English Channel.

Negotiating a mutually beneficial trade agreement between the UK and the EU in 2018 is Job Number One for negotiators on both sides.

Trade between the United Kingdom and the EU27 ranks as one of the most robust trading relationships in the world

  • 44% of UK exports are sold to the EU27, making them Britain’s most important trade partner.
  • 16% of EU exports are sold to the UK, making Britain the EU27’s most important trade partner.

Which makes the whole ‘getting an agreement’ discussion largely academic — as there will be an agreement or hundreds CEO’s on both sides of the English Channel will be breathing fire down the necks of UK and EU negotiators every day until an agreement is reached. “Don’t even think about coming home without an agreement!” (Yes, just like that)


UK/EU Trade: Where do United Kingdom Exports Go?


Where do UK exports go? UK Office for National Statistics 2015.


UK/EU Trade: Where do European Union Exports Go?


The EU's largest single export market is the UK. European Commission Export Helpdesk.


So There We Have It: They Can’t Live With Each Other, But They Can’t Live Without Each Other!

Which is a very good thing.

And because companies on both sides need to keep their biggest export market open and flourishing, there absolutely will be a reasonable trade deal — one that both sides can live with. There is simply no alternative.

Which neatly explains the title of this blog post ‘Theresa May’s New Year of Hope’ because Job Number One for Brexit negotiators on both sides must be working a successful trade deal — and every CEO in Europe will be watching with keen interest, to put it very mildly.

You don’t want to be the trade negotiator coming home without a deal and having to tell the CEO of Volkswagen or BP that you were too incompetent to get a deal. Yikes!

There will be an excellent UK/EU trade deal in 2018, a trade accord that both sides will be rightly proud of — one that works for CEO’s, citizens and governments throughout Europe.


Trade As Saviour

As the focus will be on trade in 2018 (something that both sides must preserve if today’s politicians want to keep their jobs) the new year looks to be one of the better years for relations between the UK and the EU27.

Let’s hope that Phase II of the Brexit negotiations move smartly along and that (if a Phase III is required) the momentum that gets built throughout 2018 works to facilitate friendly and workable solutions to any remaining issues between the two blocs.

Politicians and negotiators on both sides of the Brexit divide have everything to gain by bringing home a fair and workable trading agreement and everything to lose if they don’t.

Therefore, let 2018 be ‘The Year of Hope’ as 512 million European citizens are counting on their politicians and negotiators to open windows of opportunity as big as the sky, and to create even more justice and fairness for all Europeans, no matter where in Europe they may live, work, or play.

No matter which side of Brexit you’re on, the kleef&co team wish you a Happy, Safe, and Prosperous New Year!

Written by John Brian Shannon

Will Theresa May and Donald Trump Solve the #1 Challenge of Our Time?

by John Brian Shannon – Originally posted at LetterToBritain.com

UK Prime Minister Theresa May was invited to the White House on January 27 to be the first foreign leader to meet with the new American president, Donald Trump.

It’s always an honour to be the first invitee of the new president, and the timing couldn’t be better as the Western economic order is beginning to churn.

In the West, the past 70 years have been a relatively stable era with increasing wealth (although since the Reagan-era tax cuts, obscene inequality has become a destabilizing force) and social mobility has increased dramatically since the creation of the internet.

This combination could prove extraordinarily useful to motivate leaders to provide the kind of leadership required of the times — or 2017 could prove to be the pivotal moment in the unravelling of the Western democracies.

President Trump wasn’t elected U.S. president because American citizens were bored by the Democrats.

Americans voted Trump/Pence to overthrow the existing plutocracy in Washington, not to overthrow foreign governments.

Regardless how many Middle Eastern conflicts the West has prosecuted, the rich keep getting richer and the poor keep getting poorer. But this time the problems are here at home, not in some faraway country.

Americans voted for Barack Obama (2008 and 2012) and now Donald Trump (2016) in large part to stop the unfolding economic disaster in the West. Britons may have held similar ideas to American voters about a sustainable economic plan when they voted for Brexit.

Will Prime Minister of Britain Theresa May and President of the United States Donald Trump work together to solve the existential challenge of our time? Image displays the share of the world’s total wealth for the Top 1% vs. the Bottom 99%. Image courtesy of OXFAM
Will Prime Minister of Britain Theresa May and President of the United States Donald Trump work together to solve inequality, the existential challenge of our time? Image displays the share of the world’s total wealth for the Top 1% vs. the Bottom 99%. Image courtesy of OXFAM.

The chart below (from 2010) reveals the bottom 80 percent of Americans share just 7 percent of the nation’s wealth, but it’s much worse now (in 2017) and this phenomenon is no longer confined to the United States.

Theresa May must work with Donald Trump to roll back record inequality
Britain’s Theresa May must work with U.S. president Donald Trump to roll back record inequality that will eventually destroy the entire middle class. You can see the bottom 80% compete for only 7% of America’s total wealth. (This image is from 2010. It’s actually much worse now)

That trend will not change until politicians are bigger than the challenges that confront them, and actually do something about the record inequality sweeping the West.

It’s not a call to ‘do something, anything, anything at all’ — as some so-called ‘solutions’ might be worse than the problem.

But what citizens of the Western nations require is an acknowledgement by politicians of the sheer scale of the problem, and some initial steps to slow the rapid transfer of wealth away from the bottom three quintiles to the top 1 percent. (Even tiny baby-steps are preferable to the decades-long stony silence on the matter)

Theresa May and Donald Trump must ensure that globalization and free trade work for everyone.
Britain and the United States must ensure that globalization and free trade work for everyone. Image courtesy of the New York Times, You can’t feed a family with GDP by Neil Irwin.

Inequality ignored, will only result in citizens ‘giving up’ on their governments and ‘giving up’ on democracy — and we know how that will end. Badly. For everyone.

Including powerful politicians who serve for amazingly short stints of time in office. Once you’re in politics, four years pass by like a long summer!

Today’s toxic combination of ultra-low taxes on the rich and unrestricted globalization aren’t working for 3/5ths of the population. In 10 years, it won’t be working for 4/5ths of the population. And let’s remember, all of them are voters.

Here’s how that looks

In 2016, more than 50 percent of the world’s wealth was owned by the 1 percent.
By 2030, more than 70 percent of the world’s wealth will be owned by the 1 percent.
By 2045, more than 85 percent of the world’s wealth will be owned by the 1 percent.

Put another way; Do you really want to live in a world where 8 billion people are fighting over the then-remaining 30 percent of the world’s wealth?

Can you imagine what it’s going to look like in 2045 when 9 billion people are fighting over the then-remaining 15 percent of the world’s wealth?

At that time, you’d better be living on an island in the mid-Pacific that doesn’t appear on any map, in a castle with 100-metre high concrete walls.

I respectfully suggest to Prime Minister Theresa May and President Donald Trump that if inequality isn’t addressed this year, it’ll be too late. Just look for a remote island in the Pacific Ocean… now, before the rush begins.

The time involved in getting new legislation passed, combined with the lag time involved for it to take effect during the following fiscal cycle, is years after the day it is first discussed.

Can Theresa May and president Donald Trump cooperate to solve record inequality.

Let’s hope that January 27, 2017 will come to be known as, ‘The day the decline of the bottom-three quintiles was halted and reversed’ by these two great leaders.

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