Brexit’s slow-burning fuse will reach a powder keg this year

This is the year when our politicians and the so-called “people” – all 28% of the population who voted to leave the European Union – will reap what they have sown. Unfortunately, unless sense prevails, the rest of us will also suffer the product of their wild oats.

The absurdity, indeed perils, of Brexit become more obvious by the month. Business is nervous; so is the City, which constitutes far more hundreds of thousands of employees than the small, avaricious band of bankers who made their notorious contribution to the financial crisis.

It would be good if the majority of members of parliament could recall and act upon Edmund Burke’s 1774 address to the electors of Bristol: they should summon up the courage to act as representatives, not delegates of constituencies where they fear the threat from the xenophobic forces conjured up by the likes of Nigel Farage (who shamelessly continues to draw a handsome salary from an EU institution he affects to abhor).

They should capitalise on the increasing signs of nervousness and potential panic among the leading Brexiters. For the diehard Liam Fox to decide that perhaps, after all, we should remain in the customs union was rather interesting.

The personal attacks by parliamentary Brexiters on our ambassador to the European Union, Sir Ivan Rogers, were indicative of panic in the victorious ranks. The occasion was the leaking of advice given to Theresa May, in which Rogers suggested trade renegotiations with the EU could last 10 years.

This revelation provoked an unpleasant ad hominem attack on a distinguished civil servant who, in the best traditions of Whitehall, “tells it like it is” to the occupant of No 10, whether that be David Cameron or Theresa May.

Theresa May addresses ‘divisive’ Brexit in new year message

The plain, hard fact of the matter, which the Brexiters refuse to grasp, is that the other 27 members of the EU were desperate for us to vote to Remain, but were never going to roll over to the Brexiters’ proposals for a swift offer to this country to “have its cake and eat it”.

Here we come to an interesting historical development. Rogers, while now occupying a vitally important post at the Foreign and Commonwealth Office, is himself essentially a Treasury man. And the Treasury, unlike the Foreign Office, has traditionally been suspicious of the European Union.

But Rogers knows which side this country’s bread is buttered, and neither our diplomatic nor economic interest is likely to be served by Brexit. In which context, I was especially struck by the way a former Treasury official, who in days gone by was persistently vitriolic in his comments on the EU, recently contacted me to ask whether the nation had lost its senses.

The problem at the moment is that the damage caused by the referendum is on a slow-burning fuse. There are time lags in these matters: the impact on prices and real earnings from the collapse of the pound will become more evident as the year progresses. As it becomes clear that the Brexiters who have captured the prime minister do not have a convincing strategy, plans for major firms to relocate their investments to continental Europe will gradually be implemented.

Meanwhile I have also been struck by the number of people who have contacted me to express astonishment at the Boxing Day intervention of Mervyn King, Mark Carney’s predecessor as governor of the Bank of England.

Lord King has come out as a Brexiter, which is not very helpful to his successor, who can sense a prospective train crash and was quite right to warn about the impact on the pound of a Leave vote – and who, with the help of his colleagues at the Bank, has been doing his best to keep the show on the road since.

But King has long been a Eurosceptic – not just about the eurozone, on which issue I share his concerns, but also about the European Union itself. Personally, I think Brexiters such as King underestimate the damage not only to our trade from Brexit, but also the extent of the sacrifice of our potential contribution to the future of the EU in a troubled world. However, I note even King concedes that Brexit will not be a bed of roses.

He was, of course, speaking to the BBC’s Today programme, which ever since the beginning of the referendum campaign seems to have gone out of its way to give prominence to Monsieur Farage and his ilk.

They were at it again last week, with the shameless Michael Gove heavily revising his castigation of “experts”, seemingly narrowing the field of the accused to the category of economic forecasters.

Well, forecasters do their best. But economists probably regret the way that their noble trade has been associated too much in the public mind with forecasting, as opposed to fundamental economic analysis.

Anyway, while wishing readers as happy a new year as events allow, I should like to end with this wonderful quote from Jan Kamieniecki in a letter to the Financial Times: “I suspect that what Michael Gove meant to say was that the people in this country have had enough of exports.”

Powered by Guardian.co.ukThis article was written by William Keegan, for The Observer on Sunday 1st January 2017 07.00 Europe/London

guardian.co.uk © Guardian News and Media Limited 2010

 

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