Peripheral Vision: Dani Rodrik

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This is not a blog which opines on current events. It rather uses incidents, books (old and new), links and papers to muse about our social endeavours.

So old posts are as good as new! And lots of useful links!

The Bucegi mountains - the range I see from the front balcony of my mountain house - are almost 120 kms from Bucharest and cannot normally be seen from the capital but some extraordinary weather conditions allowed this pic to be taken from the top of the Intercontinental Hotel in late Feb 2020

Showing posts with label Dani Rodrik. Show all posts

Thursday, December 20, 2018

Why is the UK media coverage of Brexit so superficial?

The recent post about Brexit was a long one simply because most of the British commentary about the issue is so superficial – tending to focus on personalities rather than issues. It was left to the “Open Democracy” website to offer the sort of analysis we need - with this article which applies Dani Rodrik’s impossibility trilemma to the Brexit issue. This states that democracy, national sovereignty and cross border economic integration are mutually incompatible: we can combine any two of the three, but never have all three simultaneously and in full.

In the context of Brexit, it means that we can do any two of the following:

a) Retain the benefits of economic integration that come via membership of the EU’s single market and customs union;

b) Reclaim national sovereignty by returning powers to the British parliament that currently lie with the European institutions;

c) Uphold democratic principles by ensuring that we have a say over all the laws we are subjected to.

Theresa May’s plan partially achieves a) and b), while sacrificing c). Her strategy has been to retain some of the benefits of economic integration to avoid the damage resulting from a cliff edge, while reclaiming national sovereignty over certain key areas (immigration, agriculture, fisheries etc).

The Labour Party’s position has become clearer over time. In a speech delivered earlier this year, Jeremy Corbyn stated that Labour’s priorities were as follows:

– Negotiate a deal that gives full “tariff-free access” to the single market;

– Negotiate a new customs union with the EU, while ensuring that the UK has a say in future trade deals;

– Not accept any situation where the UK is subject to all EU rules and EU law, yet has no say in making those laws;

– Negotiate protections or exemptions from current rules and directives “where necessary” that push privatisation and public service competition or restrict the government’s ability to intervene to support domestic industry.

The first two of these seek to keep the benefits of economic integration that come via the single market and customs union. The third is about maintaining democracy, while the fourth is about reclaiming national sovereignty. Labour is trying to have all three ends served at once. This is an internally contradictory position that falls foul of the Brexit trilemma, meaning that trade-offs will likely have to be made

I’ll continue the analysis in a minute - but first let me give you a taste of how the serious British media has been covering the issue. Andrew Rawnsley is one of the country’s most respected political journalists and concludes his weekly overview of what has been perhaps the most dramatic week of the past two years in this style

The risks to Britain are enormous and yet Britons have no more faith in the official opposition than they do in a government falling apart before the country’s eyes. In the midst of the worst period for the Conservative party since the ERM crisis, the poll tax, Suez, the Corn Laws or any other precedent of your choice, Jeremy Corbyn’s Labour has become less popular and the leader’s personal ratings are even more negative than those of the prime minister.

Labour is getting a similar warning from the private polling that the party commissions. However lustily they may demand a general election when in front of a live microphone, some members of the shadow cabinet are muttering privately that they are not at all eager to go to the country for fear that their party will get a verdict from the voters that it will not like.

The endless ducking and diving about when they might call a no-confidence vote against the government makes Labour look like opportunists desperately hoping to luck into office on the back of Brexit turmoil rather than a party with the national interest at heart. You can’t keep demanding that the Tories “make way” for Labour, the daily mantra of Mr Corbyn and his drones, and then never trigger the only mechanism for making that happen.

At the heart of it is Labour’s continuing refusal to come clean about whether it will or will not support another referendum. What has always smelled of unprincipled tactical prevarication now reeks of a refusal to be honest with the electorate.

Failed by both its major parties, the biggest loser of all is Brexit-broken Britain. Our country is careening towards disaster. All of its political institutions know this. None of them seems capable of arresting it. They continue to play their games of charades as we lurch towards the abyss.

Now this is a very concise and fair assessment - but what it fails to offer is any analysis of the reasons why the politicians are behaving in such an apparently childish way….For this we have to go to sources which the public rarely access – the Think Tanks - but one which few Brits would be aware of - The Dahrendorf Forum. There I found (on its Publications List) a fascinating paper “ Cultures of Negotiation – explaining Britain’s hard bargaining in the Brexit negotiations” which, plausibly, points to three explanatory factors for the embarrassing mess the UK has made of these negotiations –
- the Conservative “ideology of statecraft”,
- the adversarial political culture of the UK
- its “weak socialisation into European structures

But revenons aux moutons – ie to the rare analysis the Open Democracy article offers of the options the British parliamentarians currently have at their disposal -

Some MPs have backed a so-called ‘Norway plus’ option, which would see the UK remaining in the European Economic Area (EEA) and joining a customs union with the EU. However, with the exception of a car crash disorderly Brexit, this represents the worst of all worlds – sacrificing both democracy and national sovereignty in order to maintain the benefits of economic integration with the EU. It amounts to “all pay, no say” – accepting all EU laws and regulations while sacrificing any democratic say over them, while also contributing to EU budgets.

It is hard to imagine a world where our politicians and electorate – who voted for Brexit in order to “take back control” – would stomach such an outcome. In any case, Norwegian leaders have made it clear that they would oppose Britain’s application to join such an arrangement.

This leaves two possible options which, on the face of it at least, do not involve a significant loss of democracy and sovereignty.

Firstly, Labour could favour a harder Brexit which seeks to reclaim national sovereignty and take back control of our rules and laws, while sacrificing economic integration with the EU – and incurring whatever economic cost that might carry (hereafter referred to as the ‘Lexit’ option). This effectively combines options b) and c) in the list above, while sacrificing a).

Secondly, Labour could favour a second referendum and campaign to remain in the EU, and seek to transform it from within – and incur whatever political cost this might carry (hereafter referred to as the ‘Remain’ option). This effectively combines options a) and c) in the list above, while sacrificing b).

The case for Lexit relies heavily on four key assumptions.

- that EU membership places significant constraints on key levers of domestic policy that would prevent a left-wing government from implementing its agenda.

- that these constraints can only be escaped by leaving the EU (i.e. reform within the EU is impossible).

- that once outside the EU, the UK will be able to exert sovereignty over these areas of policy as an independent country.

- that the benefits of this will more than offset the economic and political costs of leaving the EU. In the following sections, each of these will be examined in turn.

This post is long enough – for the detailed assessment of the extent to which these assumptions can be sustained read Labour’s Brexit Trilemma for yourself!