CapX

Likeliest Brexit outcome still that UK will exit with a deal like the one MPs just rejected

Yesterday’s rejection of the UK’s EU exit deal was the biggest government defeat ever – on the most important piece of legislation of this parliamentary term and many previous ones.

Yet Prime Minister Theresa May has not resigned. The government is almost certain to win this evening’s no-confidence vote tabled by Labour leader Jeremy Corbyn.

And – yes – the most likely scenario is still that Britain will exit the EU with a deal that looks very much like the one MPs have just overwhelmingly rejected.

Read my latest for CapX.

The new Brexit divide is between pragmatists and players

Now that the UK government and the EU have finally agreed a Brexit deal, Theresa May must seek Parliament’s approval for it. The battle lines are already drawn. But these do not involve hardline Brexiteers facing off against unreconciled Remainers, or Conservatives against Labour.

The big divide is between pragmatists who think that a bad deal is better than no-deal chaos and players who are willing to risk no-deal chaos to achieve their various ends (a hard Brexit, no Brexit, a Labour government), as I explain for CapX.

Britain’s immigration system isn’t fit for purpose

Britain’s immigration system isn’t fit for purpose. Its political targets are perverse. Its guiding philosophy is reminiscent of Soviet-style central planning. The resulting rules are unworkably complex. Their administration by the Home Office mixes incompetence with malice.

The upshot is heavy-handed controls that still leave voters feeling that things are out of control. That’s bad economics and bad politics. Even international students – fee-paying, politically uncontroversial, future ambassadors for Global Britain – are now turfed out once they’ve obtained a UK degree. Madness.

It could soon get even worse. The only bit of the system that works well – EU free movement – is set to be scrapped. Such is the perceived imperative to keep out industrious, enterprising young Europeans that the government seems prepared to sacrifice the UK’s unrestricted access to lucrative EU services markets to do so.

The danger that Britain will pull up the drawbridge is real. But if – a huge if – further knee-jerk populism can be resisted, there is also a political opportunity to craft a more sensible immigration system.

My latest for CapX

Why the UK’s “three baskets” approach to Brexit should be binned

Sometimes it takes a prime minister of Luxembourg to hit the nail on the head. “They [Britain] were in with a load of opt-outs. Now they are out, and want a load of opt-ins,” said Xavier Bettel. The problem for the UK is that the European Union is much less accommodating of its demands for special treatment now that it is on the way out. To quote an American Express advertising slogan, membership has its privileges.

Read my latest piece for CapX on why the UK’s “three baskets” approach to Brexit is a non-starter

The least-bad Brexit option may be the Jersey model

Britain still hasn’t decided what kind of post-Brexit trading relationship it wants with the EU. If the government insists on controlling EU migration, the Norway model is out. So what about remaining in a customs union with the EU? Contrary to what is often claimed, that would not avert the introduction of customs controls at Dover or in Ireland. That would require staying in a single market in goods too: the Jersey model. The only other alternative is a special status for Northern Ireland. My latest for CapX argues that given these political constraints the Jersey model may be the least-bad Brexit option.

The piece was quoted in the FT’s Brexit Briefing and Brussels Briefing. Thanks.

Why Britain would be mad to threaten a chaotic no-deal Brexit

The Brexit negotiations are at an impasse, notably over money. Some hotheads are suggesting that the UK should try to force the EU to back down by threatening a chaotic no-deal Brexit. But while a credible plan B would indeed strengthen the UK’s negotiating hand, a no-deal Brexit is no such thing. My latest for CapX