Thursday, December 31, 2020

This Is The End

It’s New Year’s Eve, and the Brexit transition period ends at 11pm tonight.

Ever since the UK joined what was then called the European Economic Community back in 1973, when I had just entered my teenage years, Europe has benefited greatly from the British economic ideology of eliminating bureaucratic barriers to trade.

The single market was to a large extent created by the British.

“Just think for a moment what a prospect that is,” Margaret Thatcher said in 1988. “A single market without barriers — visible or invisible — giving you direct and unhindered access to the purchasing power of over 300 million of the world’s wealthiest and most prosperous people. Bigger than Japan. Bigger than the United States. On your doorstep. And with the Channel Tunnel to give you direct access to it.”

It’s the single biggest reason we’re better off as a nation now than we were in the seventies – but, we’ve left now, and tonight the anaesthetic afforded by the transition period finally wears off.

Yes, the Trade and Cooperation Agreement (to give the “deal” its official title) gives us goods-only access to the single market without tariffs or quotas, but hardly without barriers to trade. The Rules of Origin regulations mean we have to prove anything we’re selling into the EU originated here, and vice versa – necessitating bureaucracy in the form of extra paperwork, customs checks, delays, and increased costs.

There’s no provision for services, despite their making up almost half of UK exports to the EU – last year, that is; next year’s figures won’t be anywhere near that high, for obvious reasons.

We’re still obliged to follow existing regulations on workers rights, environment etc since not doing so could give us an unfair business advantage, and while we can now do what we (or rather, our elected politicians and their big-business donors) like, we’ll be penalised by losing benefits including tariff free access.

Still, the odds are, the vast majority voting to leave won’t care about any of this. I won’t say they are stupid, although the published demographic for the referendum did show that the less education someone had received, the more likely they were to have voted leave.

Over time, as governments change, and older Eurosceptic voters give way to younger and better educated voters, we will undoubtedly drift back towards the EU.

Increased alignment will be needed to claw back any of the billions lost on services – albeit with less influence than we had – but that will be the price of progress.

As we see out one crappy year and more than likely welcome in another, I’m hopeful for the UK’s future in the longer term, although the short term may be bumpy for some.