Brexit as an idea and as a policy platform has had the last rites pronounced by some of its most fervent advocates. Even Nigel Farage was honest enough to admit that the project has failed. It is to all intents and purposes dead.
The absence of any tangible benefits, even minor ones, compared to the daily catalogue of drawbacks both big and small in almost every sphere of economic life in this country, from farming to financial services, is taking its inevitable toll on the public mind. Voters have turned decisively against it and there is no coming back.
Whether that means rejoining the EU or not is now a matter for future politicians and the voters.
Brexit was never a solution to Britain’s long-standing problems of sluggish growth and poor productivity. If anything it was only a symptom of a far deeper malaise, one that has plagued this country for at least a century and that we will still need to address, in or out of the EU.
A clue to this malaise can be seen in the way Brexiters struggle to explain the failure of their pet project in anything approaching semi-rational terms.
No sooner has Westminster broken the mythical grip of ‘barmy’ EU officials, than another battalion of straw men standing between global Britain and its glorious destiny has had to be hastily recruited to stand in. This is apparently a shadowy fifth column of ‘lefty-civil servants’ all intent on thwarting government policy and known as the ‘blob’ or, in a nod to the culture wars, the ‘woke blob’.
This new incarnation of the deep state is apparently responsible for getting in the way of Michael Gove’s education reforms, the defenestration of Owen Paterson, Liz Truss, Kwasi Kwarteng, Dominic Raab and Boris Johnson and turning down the wick of the lamp illuminating Brexit’s golden door. Its unforgivable sin is a lack of faith in the quack remedy that Brexiters assured voters would catapult us all to unimaginable prosperity.
At least we are getting closer to a recognition that the solutions to Britain’s problems are inside our own borders and always have been. It’s progress – of sorts – and in the long run Brexit may be seen as acquitting EU membership of being a cause of our long-standing ills. If so, it is likely to go down as the costliest experiment in history.
Like so many things in Britain, reference to the ‘blob’ is in place of any serious analysis by commentators and politicians who don’t really understand the problem and can’t produce a logical argument.
Brexit was never a solution
Britain’s fundamental problem is a lack of money, let’s face it. Look anywhere and you can see the urgent need for investment. Nothing works in Britain any more. We have lived beyond our means for decades. Brexit would not have happened if we were running trade and budget surpluses every year and ploughing money into public services, national projects, decent affordable housing or addressing huge inequalities.
Britain needs to produce more, export more and import less. So writes John Redwood, one of our foremost and vocal Eurosceptics, in Conservative Post, “We need to grow more of our own food, produce more of our own electricity and gas, make more of our own steel, cars, ceramics and the rest”.
Yes, quite. Unfortunately, some of his Brexit supporting colleagues want to open the UK market to far more cheap foreign competition while expecting farmers and manufacturers to boost domestic output and the irony is that the uncertainty surrounding Brexit has actually cut inward investment and reduced the size of our ‘home’ market by about 85%. It is not a coherent strategy.
Like other Brexiters, Redwood’s answer is a simplistic one, lower corporation tax to encourage more investment and “correct the capacity shortages we see today”.
However, a recent article in the FT, using CBI data shows uncertainty about demand, inadequate returns and labour shortages have almost always been more important factors in investment decisions going back to 1979. Raising finance is according to the FT, “almost never a constraint on investment for UK manufacturers”.
Simply cutting taxes is not the answer and probably not even part of the answer.
The real problem
The real problem is that we don’t have anywhere near enough world-class businesses producing goods the world is willing to buy and it isn’t due to a lack of finance. The steady rise in imports of food and manufactured goods over decades is testament to our lack of competitiveness.
Anyone employed by a British manufacturer, especially one which suffered a serious decline or closure in the last 50 or 60 years, should easily be able to answer the question and perhaps recognise in their experience a microcosm of Brexit.
Business owners and directors who have little understanding of the company they’re supposed to control and even less experience or knowledge of the industry in which they operate. Managers who are poorly equipped to manage and all too often notable only for their incompetence and ignorance, short-term thinking, capricious decision-making, wasted investment and the inability to pursue any policy for more than a few months.
I could easily be describing the British cabinet, and for that we have Brexit to thank. Following Johnson’s 2019 purge of any sensible moderates from the party, the cabinet table is now populated with the same kind of inept dross that can be seen and heard around the boardroom of far too many British businesses.
This should come as no surprise since Tory MPs and ministers are also members of their local associations drawn from society and presumably including in many cases the shareholders, owners and directors of the very companies we rely on to create wealth.
The PPE scandal
One case in point is the PPE scandal where billions of pounds of public money during the Covid-19 pandemic has been funnelled into a lot of private Tory-linked companies, of which few, if any, had any history of dealing with PPE.
Some businesses were just a few days old or dormant with no employees but shared a common characteristic. They were owned by men and women who thought buying and selling PPE was easy, although they had zero experience of it, and simply saw an opportunity to enrich themselves quickly. Much of what they procured has turned out to be unusable. We can only hope their comeuppance will be an expensive one.
Does anyone really think it was all down to altruism? Who believes these companies were formed to help embattled NHS staff? Were they ever likely to grow into world-leading PPE businesses spreading wealth into less fortunate areas or were they created simply to make a lot of money overnight, park it in a tax haven, buy a yacht and retire?
This cannot be an example of how to ‘correct capacity shortages’ in the long term or to build a high-skills economy that supports well paid jobs in the local community. It really isn’t.
What is the answer?
Let me be the first to admit that I don’t know, but it must begin by acknowledging there are no quick or easy answers like slashing regulations or lowering taxes.
Two things are in my opinion vital. Firstly, a proper industrial policy jointly agreed between the major parties and secondly, a voting system based on proportional representation (PR).
Industry cannot work with policies that change every time there is a new government – or indeed even when there isn’t. For too long, incoming governments have slashed investment or cut programmes on purely ideological grounds.
Moving to a form of PR would anchor all policy much more firmly and benefit industries which can plan more easily over the longer term. It would also constrain the more extreme political elements while still giving them a voice. It is disappointing that Keir Starmer appears to be stubbornly opposed to PR.
Brexit may be dead but there is no doubt it has made Britain’s problems worse and we still need to find solutions. Optimism alone won’t do it.