Argument

Nobody Is Buying What Theresa May Is Selling

The British prime minister’s big Brexit speech was a big flop.

British Prime Minister Theresa May speaks on September 22, 2017, in Florence, as she delivers speech aimed at unlocking Brexit talks.
May seeked to unlock Brexit talks on September 22 with a major speech in Florence, after Brussels demanded more clarity on the crunch issues of budget payments and EU citizens' rights. A fourth round of negotiations with the European Commission is due to start next week, with London keen to make progress on the terms of the divorce so that talks can move on to trade. / AFP PHOTO / POOL / ALESSANDRA TARANTINO        (Photo credit should read ALESSANDRA TARANTINO/AFP/Getty Images)
British Prime Minister Theresa May speaks on September 22, 2017, in Florence, as she delivers speech aimed at unlocking Brexit talks. May seeked to unlock Brexit talks on September 22 with a major speech in Florence, after Brussels demanded more clarity on the crunch issues of budget payments and EU citizens' rights. A fourth round of negotiations with the European Commission is due to start next week, with London keen to make progress on the terms of the divorce so that talks can move on to trade. / AFP PHOTO / POOL / ALESSANDRA TARANTINO (Photo credit should read ALESSANDRA TARANTINO/AFP/Getty Images)

The Italian city of Florence is renowned for Renaissance marvels such as the Uffizi Gallery, the Duomo cathedral, and the Palazzo Medici. Yet when Theresa May came to town to deliver a big speech on Brexit last Friday, she did so in the annex of a church that once served as a police training college to an audience of mostly London-based journalists. While the British prime minister had also invited top-ranking European politicians, none turned up. And shortly after she spoke, Moody’s, citing concerns over Brexit, downgraded her government’s credit rating.

Among the many reasons why the United Kingdom voted last year to leave the European Union, one of the biggest was its delusions of grandeur. Britain was big and powerful enough to go it alone. It would have the whip hand in negotiations with the EU, which would quickly agree to an exit and trade deal on Britain’s terms. The United States, China, India, and other major economies would beat a path to its door to strike advantageous trade deals. Water would run uphill.

Brexiteer zealots still believe such guff — and shameless opportunists such as Boris Johnson, the buffoonish foreign secretary with an eye on May’s job, continue to play to the gallery. But May’s Florence speech marked the beginning of a more realistic approach. With the Brexit negotiations deadlocked and the prospect of economic and legal turmoil if the U.K. crashes out of the EU on March 29, 2019, without an exit deal — disrupting trade, halting flights, stopping the transport of nuclear materials, and much else — she tried to woo the EU into unblocking the talks while keeping onside hard-line Brexiteers in her government and Conservative Party politicians who might otherwise try to unseat her.

Gone were the bluster that “no deal is better than a bad deal” and the dark threat to sever security cooperation with the EU. Instead she made big concessions and expressed an unconditional commitment to maintain Europe’s security. Recognizing that it would be impossible to finalize and ratify a trade deal by March 2019, she sought a two-year post-Brexit transition in which pretty much everything would stay the same as now except that the U.K. would no longer have a say in setting EU rules. Having previously denied that the U.K. had a legal obligation to pay a Brexit divorce bill — Johnson had diplomatically said the EU could “go whistle” — May pledged that Britain would honor its outstanding commitments. And having earlier unsettled EU migrants in Britain — not least with her “citizens of the world are citizens of nowhere” speech a year ago — and staunchly rejected a role for the Luxembourg-based European Court of Justice (ECJ) after Brexit, she offered stronger guarantees that EU citizens’ rights would be protected after Brexit, including by the ECJ.

With the fourth round of negotiations starting Monday, the U.K. now needs to detail in formal position papers what May sketched out in Florence. The EU will agree to move on to discussing their future trade relationship only if it deems “sufficient progress” has been made on the initial issues of citizens’ rights, the Irish border, and the financial settlement. Yet there are still big areas of disagreement.

The EU wants its citizens in the U.K. to keep all their existing rights after Brexit — such as the rights to reside, work, and claim welfare benefits — whereas the U.K. proposes to curtail some of those rights, notably to bring in family members. Both sides want to avoid the introduction of a hard border between Northern Ireland and the Republic of Ireland that could destabilize the peace process. But if, as planned, the U.K. eventually leaves the EU single market and customs union and seeks to control migration from the EU, there will need to be customs and immigration checks of some kind on both sides — and the EU is unconvinced by the technological solutions that the U.K. has proposed. It also remains to be seen how big a Brexit bill the U.K. is willing to pay and how flexible the EU is willing to be over the net payment of up to $71 billion that it is demanding.

Nor is the transition that May is seeking a done deal. The EU is adamant that Britain cannot cherry-pick; if it wants all the benefits of remaining in the single market and customs union for any period of time, it has to assume all their obligations. Yet May said in Florence that she wanted EU migrants to register on arrival in the U.K., a requirement that the EU rejects as discriminatory. And Boris Johnson let it be known that it would be unacceptable for the U.K. to implement new EU rules introduced during the transition in which the U.K. had not had a say. That, too, would be unacceptable for the EU.

Last but not least, May was no clearer about what future relationship with the EU the U.K. is seeking to transition to. She called for the EU to be “creative” because she still wants to have her cake and eat it, too. In essence, the U.K. wants the right to set its own regulations and curbs on EU migration while still enjoying much better access to EU markets than other countries in that position. But the EU won’t give a country leaving the club special treatment. Any future partnership with the U.K. will be on the EU’s terms.

The backdrop to all this is a deeply divided Conservative Party — whose annual conference starts on Sunday — that May continues to lead simply for lack of a better alternative. Having called an early election in June to gain a personal mandate and expand her parliamentary majority, she ended up unexpectedly losing it. She now heads a minority government in which her authority is shot. She remains in office because the Conservatives lack an obvious replacement for her, a leadership contest would eat up months of the Brexit negotiations, and the Conservatives fear that fresh elections could result in a hard-left Labour government led by Jeremy Corbyn. It remains to be seen whether May appreciates the need to make further concessions to the EU to secure a smooth Brexit — and whether she is able to convince enough of her party, too.

Florence was a step forward. But a chaotic no-deal Brexit remains a very real threat.

Photo credit: ALESSANDRA TARANTINO/AFP/Getty Images

Philippe Legrain is the founder of OPEN, an international think-tank on openness issues, and a senior visiting fellow at the London School of Economics’ European Institute. Previously economic adviser to the President of the European Commission from 2011 to 2014, he is the author of four critically acclaimed books, including Immigrants: Your Country Needs Them and European Spring: Why Our Economies and Politics Are in a Mess — and How to Put Them Right.

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