Brexit Briefing with Professor Anand Menon

Anand Menon

Geopolitics Speaker

Not a day goes by without Brexit hitting the headlines, and it can be hard to untangle the signal from the noise.

So we caught up with Professor Anand Menon and asked him to provide some clarity. 

Here are some of the key points from our conversation:

Theresa May has come under a lot of pressure over the EU Withdrawal Bill and the resignation of key government ministers. How do you see the next few weeks in Westminster panning out? Do you think her position as Prime Minister is under threat?

I think you’ve got to preface everything in British politics with the get-out clause that everything is unpredictable!

But my sense is that, while she’s every bit asweak as people think she is, she’s actually a lot more stable. And she’s stable simply because the parliamentary Conservative Party is divided by generation. A large number of the younger generation – those elected in 2010 and subsequently – think two things: (1) they don’t want a leadership election about Brexit – they want her to stay until it’s over. And (2) they’re fed up with the older generation (e.g. Boris Johnson, David Davis, Theresa May etc.) because they see them as having wasted the majority they had prior to the election. They want a leadership election where someone from the next generation wins. So while Theresa May is not popular, they want to hold her in place until the time is right to get rid of her.

There seems to be a stalemate between the UK and EU ahead of the summit in December. What do you think are the key sticking points?

I think there are two big issues that might prevent progress in December:

The first, of course, is money. I previously thought this would be an area where the British government would cave to a formula acceptable to the EU. But there have been some rumblings recently from Boris Johnson’s camp that he’s not happy with this, and it may be that that’s going to cause the PM some problems. Last week David Davis sounded a lot more willing to pay up than he had beforehand. But again, it’s all about the politics. My guess is that the UK government will agree in December to pay, but they’ll claim “we haven’t actually signed up to anything, it’s just an agreement in principle”, so as to keep their options open.

The other issue is Ireland. If we leave the customs union there is no solution to the hard border problem. And it’s not about people, it’s about goods – the EU wants a border to stop goods coming in with lower tariffs than they charge. What has been worrying in the last week from a UK perspective is that the tone in Dublin is changing. The Irish have always said they don’t want a hard border. And now some of the noises coming out of Dublin suggest that if the British insist on a position that implies a hard border, it might be better politically for the Irish government not to give the UK a deal at all, as this means they wouldn’t be seen as being complicit in the creation of a hard border. This may not be a problem in December, but it may be an obstacle to the UK getting a deal further down the line.

Michael Bloomberg said recently that London would remain the financial centre of Europe for the foreseeable future. Do you agree?

Yes, I think London will remain a massive financial hub even it loses 10-15% of business, because it has the infrastructure – lawyers and accountants etc. – and expertise that cities like Paris and Frankfurt just don’t have. 

In your latest book you describe the long term trends that culminated in the Brexit referendum. In a nutshell, what are those trends and how do you see them panning out in the medium term?

Well, the first very obvious but crucial point is that historic attitudes towards the EU played a part. The British have never fully bought into the idea.

But in the referendum, that was supplemented by something else, namely a growing sense of frustration with the state of politics and the national economy. There was deep distrust of the political class, which led people to ignore the advice of 90% of the political establishment. 

Since the vote, the nature of politics has changed in two fundamental ways. Firstly, the political centre of gravity has moved – people now talk about inequality, regional differences and discrimination. All these issues are centre stage in a way they weren’t before the referendum, and the political class have been made aware that there are issues to be fixed.

Secondly, the main two political parties, who between them got 80% of the vote in June 2017, are are more divided than ever. In the Tory party there are extreme free marketeers and people who could be described as Christian Democrats; and of course the Labour party is deeply divided between Corbyn’s supporters and those on the centre-left. This has been the case for a while. But now each party is also divided between Brexit and no Brexit. As a result, it’s even harder for them to act coherently.

The longer term problem is that if Brexit goes ahead, there will be far less money in the pot to deal with the divisions and problems that resulted in the vote in the first place.

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