MAY WROTE PAMPHLET SAYING MPs SHOULD HAVE VETO

Mrs May's hypocrisy has been made clear with the news that she and her advisor Nick Timothy wrote a detailed pamphlet in 2007 (HERE) saying ministers should gain Parliamentary approval before talks with the European Union.  This is of course quite the opposite of what she is saying now.

The pamphlet is HERE.

It heaps praise on Denmark for the way that ministers have to obtain a mandate from the Danish parliament for their negotiating position  before" they go into any kind of negotiation with the EU. The discussions are held in private but a summary is published afterwards of the items on the agenda although the specific mandate remains private.

In the pamphlet she argues it should be impossible to override parliament.

HAMMOND UNDER PRESSURE FROM THOSE STILL IN DENIAL

Phillip Hammond is coming under pressure not to "panic" and offer any kind of stimulus in the autumn statement on November 23rd.  According to The Telegraph (HERE) Liam Fox is saying it would be a "huge mistake" if he accepts what Fox claims are nonsensical figures about growth collapsing next year.

The chancellor is in an impossible position.  The treasury and the vast majority of economists and commentators expect a serious slowdown next year but colleagues in cabinet and in parliament simply refuse to accept that there is even a remote likelihood of any sort of problem.  John Redwood says the forecasts in November are "clearly going to be wrong" before they are even published!

If Hammond acts to stimulate things he will be accused of bringing about a slowdown by panicking people into cutting back on spending and investment.  Daniel Hannan was on Radio 4 this morning making the same accusations against Mark Carney.

They are like passengers on The Titanic urging the captain, after the ship has struck the iceberg, to act as if nothing has happened.

BILL FOR NISSAN COULD BE "COLOSSAL" - CLEGG

Nick Clegg (HERE) says the deal with Nissan could lead to a series of deals across industry sectors that may end up with the taxpayer paying “colossal amounts of money” in subsidies.  Jeremy Warner in The Telegraph says Theresa May has taken a "massive gamble" on getting free trade with the EU in cars (HERE).

Bloomberg are reporting that, inspired by Nissan’s success, other industries will now likely intensify their lobbying: Banks want to keep so-called “passporting rights,” while pharmaceutical giants are keen for more foreign talent and a constant stream of funding. 

GlaxoSmithKline and AstraZeneca executives are already planning to meet ministers, according to the Sunday Times.

“Theresa May is digging herself deeper into a hole by promising help to Nissan,” Erik Nielsen, chief economist at UniCredit said in a report on Sunday.

One can't help but feel the Nissan deal was done because the government simply could not face the prospect of such a huge employer and contributor to exports pulling the plug so soon after Brexit and were prepared to offer anything to avoid it. All the EU need do is announce next April that they do not want to offer any kind of trade deal and are content to operate under WTO rules and we are sunk.

Update:  Reuters are reporting (HERE) that the aerospace and pharm industries are seeking the same assurances that the government has offered to Nissan.

STERLING CONTINUES TO STRUGGLE

This week's relatively benign economic news has failed to lift the pound above $1.22. Growth is surprisingly resilient at 0.5%, more or less what the Treasury forecast before the vote and Nissan's decision to build new models and even expand production at Sunderland is good news.  Although it does beg the question for Brexiteers why Nissan took some reassuring (and perhaps even money) to remain in a UK which is apparently going to prosper like never before.

It is as if they were just about to leave Heaven but were persuaded by St Peter to stick it out!

But all this is not good for sterling. If good news does not bring about a rally what will the first bit of bad news do?  Inflation is starting to bite (HERE) and consumer confidence is beginning to fall (HERE) so we may not have long to wait. The next set of trade figures will be interesting.

NISSAN - THE QUESTIONS KEEP COMING

A couple of articles on Friday raise questions about the Nissan deal. Reuters (HERE) suggest the flood gates will open with claims from other car makers to obtain "assurances" that they won't be impacted by Brexit.  And Anna Soubry, the former business minister (HERE) thinks the government must have made some big promises to keep Nissan either assuring them Britain would remain in the customs union or confirm that they will be compensated against any tariffs.  Also Bloomberg are asking what it cost Theresa May (HERE).

A couple of other people have articles saying we will stay in the customs union including Sky News political editor Faisal Islam (HERE).

I must admit it is difficult to fault Mr Islam's logic.

BACK TO THE 1970s SAYS FORMER BoE POLICYMAKER

Adam Posen, an American who was on the BoE monetary policy committee has, in an interview, said Brexit is going to take Britain back to the 1970s (HERE) and will be a source of economic pain for years to come.  He likens Britain outside the EU to a patient with arthritis.

He says Brexit is a delusional fantasy which will contribute to stagnant growth, rising prices and a smaller economy where we are all worse off. I agree with this.

GDP DATA - CONSUMER CONFIDENCE AND THE POUND

A few odd things happened yesterday.  The latest GDP figures came out and showed a healthy 0.5% growth (HERE) significantly more that the 0.3% forecast by economists. But during the day, the pound ended about 0.7% down at $1.21700 or so.  Some commentators think this was due to most of the increase coming from consumer spending with manufacturing and construction both showing falls in output.  Today the pound has not crept above $1.2150

Then there was the news about Nissan building the new qashqai in Sunderland with all the speculation about what incentives (HERE) Nissan forced out of the government in order to avoid being burdened with tariffs.  This was followed this morning the J C Bamford's owner saying being outside the customs union and the single market would make us better off (HERE).  This is amazing, JCB seem to think Nissan asked and the government offered something (we do not yet know what) that would, according to JCB stop them from becoming better off.

What a strange world we live in. The government is now offering support and reassurance to help companies avoid becoming better off.

NISSAN PLANT TO BUILD NEW QASHQAI

Nissan has announced the new Quasqai is to be built in Sunderland (HERE) which is fantastic news for the worker and the country.  However, questions are being asked about how the government did it and Nissan are saying they haven't got a special deal (HERE).

But newspapers think there is something here because the business minister refused to answer the question six times on The World at One (HERE) and this morning The Times is claiming a last ditch deal was done to protect Nissan (HERE) from punitive tariffs and this has been promised in writing.  This seems to be right. Let's look at the timeline:  Nissan say no new investment unless they get tariff free access to Europe or compensation. Greg Clark flies to Japan to meet Nissan executives.  Nissan announce new investment.  Government say they have given "support and reassurance".

Now there is speculation that other car manufacturers will have to have the same reassurance and questions are being raised about how much this might cost (HERE).  Jonathan Portes at the NIESR Blog (HERE) has a long piece about this and quotes Reuters:

Britain has given Nissan a written commitment of extra support in the event that Brexit reduces the competitiveness of its Sunderland plant, in return for new production investments by the Japanese carmaker, a source with knowledge of the matter told Reuters. In addition to unconditional investment aid, Britain pledged in a letter to offer further relief if the terms of Britain's European Union exit ended up harming the plant's performance, the source said.

State aid is regulated under EU law and they would take a dim view even after Brexit about allowing the import of goods which are state subsidised - even the WTO rules forbid this kind of thing as Phillip Inman points out (HERE).

ANALYSING THE VOTE

Professor John Curtice, the polling pundit has produced a report (HERE) about why Scotland voted to remain but for me the most interesting thing is the level of support for EU membership from the 18-34 age group who voted 67% in favour of remaining.  This compares with 47% for the 35-54 age group and only 41% for the over 55s.

So, the people least affected by the referendum voted overwhelmingly to leave while those most affected, the young, voted even more overwhelmingly to remain.

In the next 10-15 years as the older voters pass on and assuming people's opinions remain the same (a heroic assumption I know) the majority may want to stay.  What an irony this will be when a future prime minister's pen hovers over the signing page of a new trade deal with the EU, knowing that polling evidence is showing most people want to restore our membership.

FOX WAKES UP

Liam Fox was giving evidence yesterday to a select committee (HERE) where he seems to have noted for the first time that there is a risk the EU will put "politics over prosperity". After saying for years that the EU is a political project he has at last woken up to reality and now seems to be saying if he fails it will all be down to the EU's intransigence.

Nothing to do with me guv'.

HANNAN AGAIN

Daniel Hannan has an article in The Telegraph (HERE) extolling the virtues of free trade and warning that we shouldn't lock ourselves away behind protectionist barriers.  He argues that the EU should offer us access to the single market "as we become more competitive".  Quite how we are going to do this he (like most of the Brexiteers) doesn't explain.

I wonder how he is going to sell this to steelworkers in Port Talbot or farmers facing competition from Africa or India is going to be interesting.  In fact anyone in manufacturing (which as Patrick Minford has already said will be eliminated) should be a bit apprehensive.

If journalists and politicians jobs were at risk you can bet Mr Hannan would be banging the drum for as many protectionist barriers as possible.

HARD BREXIT LOOMS

Politico, a political website dealing with EU issues has picked up on a reply given by Mrs May to Edward Leigh in the House of Commons (HERE) where he asks, in a rather rambling question, if she thinks we should negotiate a free trade deal with the EU. She says she agrees.

This means we will be out of the single market but is in marked contrast to what she told bankers in a speech in May before the referendum where she says being outside the single market would damage our economy (HERE).

Taken together with he conference speech about not relinquishing control of immigration or accepting judgements from the ECJ, I think most people will think we are heading for a hard Brexit.

MIXED MESSAGES

Two opinion polls in the last month seem to be giving diametrically opposed messages. The first by ComRes (HERE) says a majority of people put trade before controlling immigration.  A second one (HERE) by Survation for ITV says we are happy to sacrifice trade if that means we can control immigration.

How do you make sense of that?

HYPOCRISY AND DAVID DAVIS

There have always been hypocrites in parliament and elsewhere but I used to think David Davis had something about him. Now I see he has the same feet of clay as all the others.

In a debate in 2002 on the Regional Assemblies Bill he was highly critical of John Prescott because a vote on the bill was being proposed before details of the assemblies powers and scope had been set out. He said this (HERE column 201):

In a democracy, voters have to know what they are voting for. They need to know what the choice is, to use his own word. For that to happen, the proposition has to come before the vote, but with the Bill, it will be vote first, proposition afterwards. The Bill proposes that referendums should be held without voters knowing the structure or powers of the assemblies for which they are asked to vote. Even the Deputy Prime Minister would have a hard job to convince anyone that that is democratic. 

Firstly, the 23rd June vote was against something and not for something. But also, now he is in the executive, he is proposing Mrs May and himself get to define what people voted for.  It is amazing that he can defend his position.  He went on to say:

Referendums should be held when the electorate are in the best possible position to make a judgement. They should be held when people can view all the arguments for and against and when those arguments have been rigorously tested. In short, referendums should be held when people know exactly what they are getting. So legislation should be debated by Members of Parliament on the Floor of the House, and then put to the electorate for the voters to judge.

GROWING INTOLERANCE

For years we have been fed a diet of poison about the EU by The Daily Mail, Daily Express and The Sun with very little in reply. We accepted their right to be critical of the EU and we accept a free press should hold the powerful to account.

But now we are told that any criticism or wish to reverse the decision to leave the EU is tantamount to treason. In fact a conservative councillor has even started a petition calling for support for the EU to be added to acts which constitute treason.

The Independent carries an article (HERE) about the tabloid press raging against those who want to "subvert the will of the people".  This is the people who they have spent thirty years brainwashing with nonsense stories about bent bananas and non recyclable teabags.  Apparently, they think because 52% have spoken the other 48% must shut up.  Democracy does not work like that. After an election the opposition continue to oppose and that is how it should be.

Moreover, it is the vacuum of policy which is causing the rising panic among the tabloids and this is no one's fault but their own. They had no idea what the 52% were being urged to vote for.

UK TO LEAD THE WORLD ON FREE TRADE

Theresa May is claiming after Brexit we will lead the world and be the most passionate and convincing advocate of free trade (HERE).

Before the vote, Patrick Minford from Economists for Brexit wrote a piece for The Sun (HERE) where he advocated free trade and said the effect would be that BMWs and Brie would be cheaper although I don't believe there are any tariffs on either at the moment so it's hard to see how they would be cheaper.  However, in the article he also said:

Over time, if we left the EU, it seems likely that we would mostly eliminate manufacturing, leaving mainly industries such as design, marketing and hi-tech. But this shouldn’t scare us.

Let us hope Mrs May explains this to the workers in manufacturing before she becomes the most passionate and convincing advocate of free trade.

TARIFFS - WHO PAYS?

Civitas has produced a report apparently showing the EU would be worse off by £7.7bn (HERE) if they introduce tariffs according to the regime in place at the moment and using trading figures from 2015. Newspapers have picked this up and are reporting it as a potential own-goal for the EU.

However, I think it is simplistic and wrong. Here's why:

Firstly, it assumes there is no change - either to prices or the behaviour of buyers or sellers. The more likely outcome is a change in both to some degree.

Secondly, although it is right to say the government of the importing country gets the benefit of the tariff and this comes from the supplier in the exporting  country, it is more likely than not that the customer in the importing country bears the cost because the price will go up.  Civitas appears to make the error of thinking manufacturers pay VAT - of course they do but it is the customer who bears the cost.

So, to say the EU will pay £7.7bn is misleading. If European suppliers increase prices by the same amount as the tariff, it will be the UK customers who will pay.  And if we are at the same time compensating Nissan (and others) for the tariffs applied to exports into the EU the UK will carry all of the costs of any tariffs (see HERE).

CONSTITUTIONAL CRISIS LOOMS - WARNS REPORT

The Institute for Government has issued a report saying a constitutional crisis looms unless there is agreement by all the devolved governments on the negotiating position for the terms of Brexit (HERE).

Mrs May has today announced a "direct line" to David Davis for all the First Ministers, offering them a way to shape policy. Whether this will be enough remains to be seen. I would have thought they already had a direct line to David Davis so it doesn't look to me like anything new.

NOW WE ARE RESORTING TO BLACKMAIL

Some government ministers are reported to be considering reducing corporation tax to 10% in a bid to attract companies to the UK after Brexit and in a bid to "put pressure" on the EU to offer a good trade deal (HERE).

This looks like a threat.  Give us a beneficial deal and nobody's tax revenues get hurt.

The Telegraph's editorial on Saturday said we are use to threats from the EU but I think over the years we have issued many more threats and the |UK trying to play the victim after the Brexit vote won't wash with the EU

NISSAN DECISION THIS WEEK

James Forsyth, writing in his Spectator blog claims Brexit insiders are saying Nissan will announce this week that Sunderland will build the new Quashqai.  Whether this is true or not we wait to find out. For Sunderland's sake let us hope it is.

However, Mr Forsyth (HERE) is saying that government was able to give "robust assurances" that there will be tariff free trade after Brexit and were "fully confident" they would not need to pay any compensation.

But think about this. Tariff free trade is not in the government's gift and if compensation has to be paid other manufacturers will want the same. This will mean the British taxpayer will have to pay tariffs on imports from the EU and compensate manufacturers for tariffs on exports to the EU. Looks like a lose-lose situation to me.

BANKS PREPARE TO RELOCATE

Anthony Browne, head of the British Bankers’ Association, claims (HERE) that some smaller banks are preparing to relocate into Europe before the end of this year, with larger banks set to follow in the first quarter of next year. If anyone is in a position to know it must be Mr Browne.

He puts this down to uncertainty over Brexit and also says the equivalence regime is no substitute for passporting rights, no matter what the Brexiteers say.

Bloomberg are reporting in today's newsletter that a property company managed by Schroders Plc is bidding for an office building in Frankfurt, joining CBRE Global Investors LLC and Standard Life Plc, which are seeking to purchase office space in cities from Dublin to Amsterdam.

THE WTO OPTION - VERY VERY COMPLICATED

David Davis admitted in parliament this week that if we don't get a trade deal with the EU after two years we will face a cliff edge. He means we will be forced to trade under WTO rules, which some people, including Nigel Farage thinks will be just fine.  But this seems to be a highly optimistic view. If we are facing a cliff edge, the WTO option represents razor sharp rocks hundreds of feet down.

Read this for the International Centre for Trade and Sustainable Development (HERE).

A few key points:

The UK is already a WTO member, but its membership terms are bundled with the EU’s. Re-establishing the UK’s WTO status in its own right means both the UK and the EU would negotiate simultaneously with the rest of the WTO’s members [162] to extract their separate membership terms. Agreement on the UK’s terms is unlikely before those of the EU.

To be an independent WTO member, the UK would be creating its own rights and obligations out of the EU’s. That’s not as simple as it sounds. One reason is because other countries with different interests would want to ensure the balance is also right for them.

Now comes the surprise. We don’t know what most of the EU’s current commitments in the WTO are. The UK would be negotiating a share of key quantities that are unknown. The only confirmed commitments on tariffs, quotas, and farm subsidies are from before 2004 when the EU had 15 member states. The EU has expanded three times since then, but in 12 years it has been unable to agree with the WTO membership on revised commitments.

This looks like a Herculean task in itself and remember - this is plan B!

Update 27th October:  The Spectator has an article suggesting the head of the WTO Robert Azevado is back tracking on warnings he gave before the vote (HERE) but as far as I can see he is not saying anything different at all, simply stating the facts.

A DILEMMA

The government has a bit of a dilemma coming up. Article 50 is to be triggered by the end of March 2017 but it seems clear this will be done before two absolutely key points are certain.

Firstly, we do not yet know if Article 50 is irrevocable or not and this would need to be clarified by the ECJ. The actual legal position may not be known when it is triggered – unless the UK applies to the ECJ beforehand and it is not clear they would even want to do this.

Secondly, we don't know if trade negotiations will take place in parallel with withdrawal talks or will have to wait until after we get out. This is important. David Davis thinks they will be simultaneous based on a phrase in Article 50 that says the agreement is to be concluded “taking account of their future relationship” with the EU. The EU's trade commissioner has said it would be illegal to negotiate a trade deal before we leave. The EU may even be daring us to take the risk.

Think about this. It really is a leap into the unknown. No doubt the government will try to get more clarity but at the moment the EU are refusing any pre-negotiations. If Mrs May sends the Article 50 letter without knowing these two things with absolute certainty it will be a massive gamble.

LEGAL CHALLENGE TO ART 50 - FAISAL ISLAM'S TAKE

It seems Faisal Islam, the Sky News reporter attended the high court hearing last week where the legal challenge to the triggering of Article 50 by the government was being heard.  He now thinks the decision will be close, having initially believed the judges would find in favour of the government, now he is not so sure (HERE):

What was thought of at first as a marginal case is now looking rather in the balance for the Government, with potentially huge significance for Brexit.

And:

The Lord Chief Justice said twice that [the government's] argument "baffled" him.

It is entirely plausible that the Government will lose this case, which might come as a shock to Westminster.

I think he is right and the significance will certainly be huge.

DIP IN CORPORATION TAX

Corporation tax receipts are down and have cause a dip in tax collected in September (HERE). Forecasters expected we would need to borrow about £8.5Bn but in fact the figure has turned out to be £10.6Bn and it is now expected there will be a shortfall this financial year of about £14Bn.

So, where we had expected to borrow £45Bn, in fact we now expect this to come in around £59Bn.

I think by January there will be very little in the way of good economic news and it will be interesting to see how this impacts public opinion.

MATTHEW PARRIS

Matthew Parris has written a piece for his Times blog (HERE) and it's well worth reading. He, like many of us, is concerned at the vitriol used against those of us who want to remain in the EU and points out that many of the articles attacking remoaners are a smoke screen for a lack of progress towards the Brexit they assured us would be quick and easy.  He writes:

For my friend, Times colleague and Leave campaigner, Michael Gove, to spend every paragraph — yes, every paragraph — of his column yesterday railing against the side that lost the European referendum campaign attests more eloquently to suppressed panic than anything we the vanquished could write. Edvard Munch’s The Scream hovered over his words.

The Freudians call it displacement activity, and it tells us so much. To our intense disquiet we find the victors, hollow-cheeked, still stalking the battlefield, kicking irritably at corpses, months after their war was won.  

Bayonet the wounded all you like, Leavers, but the nation waits to hear your plans. You have the baton. Where are you going to run?

The initiative is yours. We await your proposals and we accept your right — even (as I have written) your duty — to proceed with them. But we want to know what they are. How do you plan to make this thing work? Michael Gove began his column with three short sentences: “Take. Back. Control.” I can reply with one: “How?” Or perhaps in the same vein: “What. Are. You. Going. To. Do?”

We ask because the suspicion grows that none of you has the foggiest. And if that’s true then you have betrayed the trust of 17 million people who thought you knew. Before the referendum you assumed the mantle of “us” in a revolt against “them” and profited mightily from that assumption. But now you’re in charge. You’re not Us any more: you’re Them, the new Establishment, the powers that be. You are the experts we were enjoined to scorn. So scream — because the people’s anger will be terrible.

THE EU'S ATTITUDE IS HARDENING

This morning on the Today programme we heard a German MEP, leader of a group in the EU parliament talking about Theresa May's first summit meeting where she said Britain expected to play a full part in EU discussions until we exited the union (HERE).

This has apparently not gone down well (HERE) since some UK minister has talked about blocking things which the EU want to do in the future on cyber security and other things which will have no impact on the UK at all.  Talk about how not to win friends!  It would not be a shock to learn the EU does not want a trade deal with us at all and are happy to go along with WTO rules.

Also, we caught a bit of Question Time last night. Yanis Varoufakis, the former Greek finance minister said Theresa May has committed to compensating Nissan if tariffs are imposed - and he accused Conrad Black of living in a parallel universe for saying he thought the EU would "come to its senses" and offer us a good deal.  If anyone knows how hard line the EU can be it is Mr Varoufakis.

EU President Donald Tusk told May that her desire for the U.K. to be a “strong and dependable” partner may be easier said than done as he ignored her protests to say that the remaining 27 members would continue to meet without Britain.

TORY MAJORITY SLASHED IN WITNEY

The Tory majority was cut by over 20,000 to under 6,000 by the Lib Dems at yesterday's by-election in Cameron's old constituency which voted to remain in the EU referendum (HERE).  I wonder if conservative strategists have thought about the 48% who voted to remain and how many they might expect to lose to the Lib Dems in 2020 - assuming they stand on an openly pro-EU manifesto?

If negotiations go badly I think we may see a resurgence in Lib Dem fortunes.

DAVIS IS IN "CLOUD CUCKOO" LAND

As I think is becoming clear, David Davis is slightly detached from reality. The other day in the house he claimed that we would be in very strong negotiating position with the EU. Now a former British negotiator, the one who negotiated our rebate along with Margaret Thatcher says he is living in cloud cuckoo land (HERE).  Sir Brian Unwin thinks ministers have got a "horrific" job ahead of them and I think he's right.

CALAIS

The leading contender for the French presidency, Alain Juppe, has called for the Le Touquet agreement to be renegotiated so that border checks are carried out in Britain rather than France and so moving the migrant camp in Calais to the UK (HERE). This was something the leave campaigners told us would not happen because it was a bilateral agreement and nothing to do with the EU.

UNEMPLOYMENT STEADY

We may have reached the bottom as far as unemployment goes with the figure actually rising by 10,000 (HERE) in the quarter ending in August.  News coverage is saying employment is holding steady at 4.9% but when you reach the bottom of the curve, this is what I would expect.  There will be a flattening out before a rise.

MAY'S POPULISM NOT POPULAR IN EUROPE

A German MEP, Manfred Weber, leader of the Christian Democrats says Theresa May's populist approach is pandering to UKIP voters and it will be a disaster for the UK (HERE).  He says EU leaders are hardening their stance against the UK. 

In a sign of the unity over Brexit in the other 27 national capitals, EU President Donald Tusk said last week that Britain faces a choice between a “hard Brexit” or “no Brexit” and that it’s time May realised the withdrawal “will be painful for Britons.” Weber echoed the remarks about the economic consequences for the U.K., including its role as a leading banking center.

“There are a lot of friends who think already about how we can benefit economically from this development -- about the financial sector, how many companies will leave,” he said. “There are debates going on in this direction.”

As I have said before, our friends have now become our competitors. What did we expect?

NO SECOND REFERENDUM?

There is more or less an acceptance that Brecht is going to happen. I think that is probably right but the path to it is anything but straightforward. Unless I and plenty of others are completely wrong the economy is going south, at least for a while. If this brings a rise in unemployment and inflation and a fall in tax revenues many more leavers will probably have second thoughts. Already it seems about 6% regret voting leave and really very little has happened to the economy.

I think many will be surprised how costly, difficult, protracted and divisive it will all be. Weirdly, while Europeans and Americans seem opposed to free trade agreements (HERE) and favour protectionism we are cheering the opposite. This is strange and I suspect many voters may not be happy when they begin to understand how it all works.

So, it would not be a surprise to see opinion polls, in a year or two when Brexit is fast approaching, showing a consistent majority for remain. Especially if no deal is in sight. The question then will be what does the government do? Theresa May is to tell EU leaders there will be no U turn or second referendum (HERE) but she may herself be forced into a U turn.

THE LEGAL CHALLENGE

I have been following the legal case challenging article 50 and find it fascinating. The government is fighting hard to circumvent parliament, presumably because they are worried the remain majority will vote against it or MPs will demand to know too much about the negotiating stance.

The case turns on whether the royal prerogative can legally be used to notify withdrawal from the EU or if parliament alone can authorise it. The prerogative cannot be used to remove rights that parliament has given and some rights like the freedom to move anywhere in the EU will be lost when article 50 is triggered. Personally I don't think the government will win but we will see what the high court (and later the supreme court) has to say. A decision is expected in two or three weeks.

Newspapers and markets are making a lot out of the admission made by the defendant's counsel that MPs will be able to vote on any final deal. But this is only described as likely not a certainty and they will vote under CRaGS – The Constitution Reform and Governance Act 2010 which only allows MPs to stop the deal being ratified for 21 days only and they will have to keep doing this over and over again to stop it.  When the markets see this they may not be quite so happy.

An explanation of GRaGs is HERE

OPINION IS BEGINNING TO TURN

The Economist has a chart (HERE) from a serious survey of 10,000 people showing that 6% of leavers now regret their vote compared to 1% or remainers.  This means if a new vote was held tomorrow, remain would win (HERE)

Meanwhile, inflation figures out yesterday show a sharp increase to 1.0% (from 0.6%) in the last quarter.  Much of this is being blamed on Brexit (HERE) with people admitting there is more to come with 3% being the likely figure for the middle of 2017.  It is those at the bottom who will be most affected, as food and clothing prices increase. In other words those who were more likely to have voted leave. People are more pessimistic about the future (HERE).

I wonder how opinion will change when the impact of the decision becomes ever clearer?  If Article 50 is not triggered before March it may never be triggered. It is a race to see if reality prevails in the cabinet before or after Article 50 is set in motion. As remainers warnings are shown to be true, while leave arguments are obviously wrong opinion will change quickly.

WITHDRAWAL FROM THE CUSTOMS UNION

The government has been looking at a paper prepared to set out the options and effects of leaving the EU customs union (HERE).  The predictions are dire with a 4.5% reduction in GDP by 2030, huge infrastructure problems at Dover (and presumably other ports).  The paper also said to stand still economically we would need to grow trade with our top ten trading partners by 37% by 2030.

David Davis, the Brexit secretary, and Fox were said to have accused officials of drawing up a deeply “pessimistic paper.  Even now they cannot accept facts and want dreams, particularly their own, to replace serious professional advice from experts. When will they learn?

THE VALUE OF THE POUND

Roger Bootle in a Spectator blog (HERE) thinks we should celebrate the fall in the pound.  He approvingly quotes for a newly published book the benefits of a lower pound. But the piece also contains this:

Unless something changes, the UK economy is heading for the rocks. This is not because of the consequences of Brexit. On the contrary, the factors that we identify in The Real Sterling Crisis that cause us such unease predate Brexit, or even the chance of it, and have practically nothing to do with it.

On the face of it, the British economy does not look too bad. But we are not paying our way in the world. Every year, we are borrowing and selling assets to the tune of about 5% of GDP. This is rapidly increasing the amount of our economy that is owned by foreigners. This would not matter so much if we were using the money provided by foreigners to invest in productive capacity. But we are not. UK investment is extremely low. We are borrowing and selling assets in order to maintain our standard of consumption.

The book laments the selling of British assets to fund consumption but a falling pound will only make matters worse, our assets are now 20% cheaper than they were in early June.

THE ECONOMY FACES PROLONGED WEAKNESS

The Ernst & Young Item club, which uses The Treasury's own computer model of the economy, says (HERE). They expect a drop in consumer spending next year as inflation rises and that overall growth in 2017 will fall to just 0.8%.

Peter Spencer, chief economic advisor to the EY Item Club, said: "So far it might look like the economy is taking Brexit in its stride, but this picture is deceptive. Sterling's shaky performance this month provides a timely reminder that challenges lie ahead. As inflation returns over the winter it will squeeze household incomes and spending.

"The pressure on consumers and the cautious approach to spending by businesses mean that the UK is facing a period of relatively low growth,"

It will be interesting to see what some of those forecasting a great future will be saying this time next year.  The pound is trading around $1.21500 this morning, down a little again.

THE IRISH FEAR BREXIT WILL BE A DISASTER FOR THEM

I pity the Irish. They are good Europeans and in my opinion one of the most cultured nations on earth. We have not done them any favours over the centuries and now Brexit is going to do lasting damage to their economy.

They think it will be a disaster and some firms are going bust already because of the fall in the value of the pound (HERE).  This may even throw north and south together in a way that will help those who want to break up the UK.

HAMMOND IS BRIEFED AGAINST - AGAIN!

Phillip Hammond is once again being briefed against with cabinet "colleagues" saying he is undermining Brexit and thinking like an accountant with only the risks being considered and not the potential benefits (HERE).

I have spent a lot of time in meetings with people like Fox, Davis and Johnson (for it is one or other of these doing the briefing I am sure) who are the opposite, seeing only the potential benefits and not the risks. Really we shouldn't even be in the position we are in with the nation's future being gambled on the roll of a dice. Either the leavers should have been certain and the case unarguable so that remainers had nothing to worry about or we should never have voted to leave in the first place.

I have to say when people who are not experts exhibit nothing more than faith and a gung-ho attitude I worry a lot because disaster is usually just around the corner.  This cabinet row is going to end in tears for someone.  If Hammond resigns the pound will end up worth less than a dollar!

EUROPE TURNING ITS BACK ON UK

The Telegraph (of all newspapers) says there are growing signs that Europe has “given up” hope of concluding a mixed trade deal with Britain and will instead concentrate on completing a rapid divorce with the UK (HERE). 

Senior EU diplomatic sources have told The Sunday Telegraph that Mrs May’s Tory conference speech was widely seen as slamming the door on the UK staying inside the EU single market.

“The speech was very clear. Mrs May excluded the UK from jurisdiction of the European Court of Justice (ECJ) which is necessary for any kind Free Trade Agreement,” said a senior EU diplomat with knowledge of Europe’s negotiating position. This is in addition to taking back control of immigration.  So, rather than giving a running commentary the government has set out its position from the outset - we don't want any kind of deal beyond WTO rules!

This is playing into the hands of the EU who want Brexit to hurt to deter others according to the CER (HERE). And a former Polish finance minister (HERE) says:

"If British voters recognized their country’s weak negotiating position, the Brexiteers, who won the referendum on their promise to “take back control,” would face a political disaster. Walking away from substantive negotiations is the simplest way to avoid such an embarrassing unmasking.

Thus, politically, a hard Brexit is actually the soft option for the government. Economically, however, hard Brexit will come at a high price, which the UK will have to pay for years to come".

A DECLINE IN LIVING STANDARDS TOO HIGH A PRICE FOR BREXIT

An economist and former member of the BoE monetary policy committee, David Blanchflower, as a piece in The Guardian saying there will be a fall in UK living standards (HERE).  He asks if sovereignty is worth a 5, 10 or even a 20% decrease in living standards.

Personally, I don't believe he goes far enough. For Brexit to succeed and for all the trouble it is going to bring we need to see a significant increase in the wealth of the whole nation.  At the moment it doesn't look like that to me.

Even The Telegraph, usually deaf to any anti-Brexit stories has an article (HERE) saying the price of petrol is at its highest for a year and consumers must be braced for increasing costs.

STANDARD & POOR'S WARNING

S & P are one of the large US ratings agencies and they have issued a warning about Sterling's role as a reserve currency (HERE). They said the British government is treading into hazardous waters in negotiations with the EU and is risks serious damage to economy’s future growth trajectory, with long-term implications for the debt profile and the country’s credit-worthiness.

S&P fears that loss of unfettered access to the single market would have incalculable consequences for business, yet the Government so far appears almost insouciant about this.

“There seems to be this view that ‘we’re a big important economy, the Europeans export a lot to us, so they have got to give us what we want’, but is that really true?" said Ravi Bhatia, the director of sovereign ratings in charge of Britain.

Exactly!

NISSAN BOSS MEETS MRS MAY

Carlos Ghosn met the prime minister yesterday in Downing street and afterwards (HERE) told the press he was:

"confident the Government will continue to ensure the UK remains a competitive place to do business. I look forward to continued positive collaboration between Nissan and the UK Government.”

This is interesting since beforehand he was asking either for a guarantee Britain would remain in the single market or compensation if tariffs were to be imposed.  So, did Mrs May offer either of those things or not?  We wait to see who blinked first.

Mrs May said, "We will continue to work with Nissan as we develop the environment for competitiveness of the automotive industry here in the UK to ensure its success."  The Sunderland Echo has the story (HERE).  Reuters' story (HERE)

BANKS COME BACK INTO THE FRAY

The banks have this week come back into focus, firstly with this article in The Telegraph (HERE) suggesting that New York may gain at London's expense over Brexit.

Then the French minister of finance Michel Sapin said he had been told directly by some US banks that it was not a question of IF they move some functions to the EU but WHEN (HERE).  The Telegraph even claims it is already beginning to happen (HERE) but it isn't noticeable because rather than people moving, it is the jobs that are going.  Work that would have been done in London is moving into the EU.

There is some irony here since The Telegraph told us in March that there wouldn't be an exodus of banking jobs after Brexit (HERE).

Also the chancellor has been saying the EU shouldn't shoot itself in the foot by damaging London since this wouldn't help European companies but Bloomberg has an article (HERE) saying London isn't that important to the EU.

“There are vested interests and people saying this for British interest,” said Karim Hajjar, chief financial officer of Brussels-based chemicals maker Solvay SA. “Skills are easily moved. If London can’t offer the platform, it can be recreated pretty quickly.”

Stefan Kraus, a London-based partner at German law firm Luther, whose clients include Bayer AG, Deutsche Telekom AG and Infineon Technologies AG, said the U.K. bankers’ and officials’ warnings sounded hollow, given that there are no rules barring EU companies from raising money via banks outside the bloc.

“It looks a bit like wishful thinking in the search for arguments,” Kraus said.

NOW THE TELEGRAPH ATTACKS REMAINERS

After the bile from The Daily Mail this week (HERE) today it's the turn of The Telegraph to let loose against remainers or bitter losers as it calls us (HERE).

They attack Unilever for wanting to put up prices - either because the selling price has been cut by 20% or the production costs have risen - and seems to think they should just absorb it all. All this while elsewhere in the same paper it warns that dozens of household name brands will have to raise prices by 10% in the coming weeks because of Brexit.  You couldn't make it up.

They say: [Unilever spoke out against Brexit] - So, of course, did a lot of MPs – and now they insist that Parliament must be in the driving seat for Brexit. The hypocrisy of some of them is breathtaking. For years they sat by as the EU undermined Parliament’s sovereignty. Now they want to assert it

This is hypocrisy - but on the part of The Telegraph who wanted sovereignty to return to parliament but now want to bypass it!  This is the way The Independent saw it (HERE) saying it was the Brexiteers that wanted parliament to be sovereign!  So much for that.

LEGAL CHALLENGE TO ARTICLE 50 BEGAN YESTERDAY

Reuters (HERE) are reporting the start of the legal challenge to the government's plan to use crown prerogative to trigger article 50. This is a crowd funded legal challenge and you can keep up to date with progress on the link in the side bar on this blog.

I believe the government is going to find it very hard to argue against giving parliament the right to vote on whether or not Article 50 is triggered. The legal arguments seem very sound to me and I think the courts will find in our favour.

The Guardian believe parliament should be heard (HERE).  If the government is wise it will allow a vote otherwise parliament could get very difficult to control. There is a big majority against leaving and while I don't believe they will block it, MPs should have a vote and make recommendations about which sort of Brexit they will support.

HARD BREXIT HERE WE COME

The EU have obviously been listening to the rhetoric coming from the government and leave supporter this week and have concluded (HERE) that we are headed for total separation from the single market and the customs union, otherwise known as a hard brexit.

Donald Tusk, president of the EU council, in a speech in Brussels says the UK has a choice between a hard brexit and no brexit at all (HERE). In a dig at Boris Johnson's cake metaphor and his suggestion that we could get a better trade deal with the EU after leaving, he had this to say:

“That was pure illusion, that one can have the EU cake and eat it too. To all who believe in it, I propose a simple experiment. Buy a cake, eat it, and see if it is still there on the plate.”

We look increasingly stupid and pathetic.  The pound keeps edging south and is trading below $1.22 this morning.  

DAVID DAVIS CALLED FOR A THE WHITE PAPER HE NOW SAYS WE CAN'T HAVE!

One has to admire David Davis for sheer chutzpah. Before he was appointed as SoS for Brexit he published an article (HERE) in Conservative Home in which he suggests publishing a pre-negotiation white paper.  That's the white paper he now says he will not publish.

He also talk about "our indigenous car industry" which as we all know does not exist. Our car industry is almost wholly foreign owned.  Perhaps he thinks we will be subsidising Maclaren?  He also says the tariffs we raise on foreign car imports could be used to fund research or investment tax breaks for the foreign owners of these businesses.  This would go down well with the buyers of these cars I'm sure.

PRODUCTIVITY IMPROVEMENT NEEDED

In a classic case of putting the cart before the horse, Jeremy Warner at The Telegraph is saying we need to urgently address our "shameful" productivity problem (HERE).  I agree with this but since we are likely to be out of the single market by 2019 it's a bit late to start think about how we improve productivity. We will soon face the full force of world markets.

As Mark Carney at the BoE put it we rely on the kindness of strangers for direct investment into the UK in order to keep us afloat and bridge the current account gap. We also rely on foreign companies to boost the poor productivity we have.  Without the likes of Nissan and BMW our trade gap would be much wider.

Productivity improvements - even if we knew how - will take years to come through.

PRICE RISES START TO BITE

Huffington Post (HERE) and the BBC (HERE) and Sky (HERE) are all reporting on the row between Tesco and Unilever about rises in the prices of may famous brands made by Unilever companies. The pound's slump in value by nearly 20% against the dollar and the euro is forcing manufacturers and suppliers to face up to the fact that Brexit is going to cost money.

On the TV at lunchtime, Lord Wolfson, a leading Brexiteer and CEO of Next also warned of price rises but said the government needs to "invest in infrastructure" to offset these increases.  I am not sure I can even begin to understand how investment in roads, bridges, railways and so on is going to have any short or even medium term impact on prices in the UK.  A cheap currency and a high level of imports is bound to make us all poorer - precisely as he was advised before the vote.

I wonder when he will admit there was no scaremongering at all?

DOMINIC GRIEVE

In the debate yesterday Dominic Grieve MP, former attorney general had this to say about repealing EU law (my emphasis):

I have to say that, as a lawyer, I see the repeal process and our leaving as a legal nightmare, and one that will take up an endless amount of the House’s time, to the prejudice of many other priorities on which we should be focused. It undoubtedly impinges on the devolution settlements and competence. We have a duty to maintain legal certainty and the rule of law, which will be jeopardised in the process. There are private legal rights that are likely to be affected, some of which might lead to litigation and claims for compensation.

I am not a lawyer but I have a lot of respect for Mr Grieve and I wonder what it is that he expects?  If litigation does arise I can see Brexit rumbling on for years and years.

THE DAILY MAIL'S BILE

The Daily Mail's editorial on Wednesday (HERE) was terrible even by their own standards. Those of us mounting or supporting a rearguard action to avoid disaster are denounced as whingeing, contemptuous and unpatriotic. It has been suggested the piece s the work of the egregious editor Paul Dacre (HERE).

Roy Greenslade in The Guardian thinks it shows Dacre's fear that Brexit will in fact be a disaster.

If a friend tells you he intends to throw himself off a cliff next year you do not stand idly by but try to convince him to think again. That is what we are are doing.

EXPERT OPINION SHOULD STILL BE TELLING US SOMETHING

I sometimes muse on the array of expert opinion that has and is still being ignored on the Brexit question. Let’s have a look at them.

CONSERVATIVE SPLITS BEGIN TO SHOW

An almighty row is brewing in the Conservative party over the terms and the process of Brexit. A majority of tory MPs were for remain (about 180 to 130) and they have begun to fight back. 

Yesterday’s opposition day debate saw tempers fray. You can see some of the exchanges in Hansard (HERE).  David Davis attacked those who want parliament to vote on Article 50 and warned of a "Brexit blame festival" (HERE) whatever that is. Bill Cash accused remainers of weasel words.

As I said before I think leavers honestly thought everyone would accept the result of the referendum without a peep.

THE VIEW FROM EUROPE

It is always interesting for me at least, to check out the reaction in Europe to the farce that we have seen around the vote and afterwards. A Guardian journalist (HERE) makes some observations that we don’t see in the British media. Among them are the insults we have hurled at the EU over the past few months (this week they were called a tyranny!) which are never going to help smooth the way.

He also talks about the blackmail that Cameron used, threatening to support leave unless he got some concessions. The article now points out the boot is on the other foot and it is the EU who will now be threatening to give us leave.

And as for the EU needing the UK more than the other way round he asks who is begging us to stay to avoid damaging the EU? Nobody. The pound is down against the euro rather than the opposite. Companies are talking about moving into the EU not out of it.

Amazingly, David Davis actually thinks the cards are stacked in our favour! He must have banged his head just before uttering these words in the House of Commons yesterday. If not he’s delusional.

BATTLES LINES BEGIN TO BE DRAWN

It began when a “leaked” document showed the UK would be £66Bn worse off (HERE) if we left the EU and traded under WTO rules (known as hard Brexit). Actually, the figures were released in April but are now coming to people’s notice because the Treasury is sticking by the forecasts it made before the vote.

Many prominent leavers, including David Davis I believe, thought the figure had been cooked up to help the government. It turns out that The Treasury is not bending.

Mr Davis is apparently upset and is now accusing The Treasury of trying to undermine the negotiations (HERE). In the article some unnamed cabinet minister says he has yet to meet a senior civil servant who voted to leave or who thinks Brexit will make us better off. This alone should be reason to pause for thought but it apparently isn’t.

This is all part of the battle in Whitehall between Hammond on the one hand and Davis and Fox on the other (HERE). This is only going to get worse, the Brexiteers in government will never accept they are wrong and will always blame others.

Interestingly, The Treasury are saying here is our evidence of the downside where is your evidence for the upside. This may take a bit of finding – since there isn’t any. If the cabinet takes a decision to exit the single market it will be on faith alone.

LAUGHING STOCK

We are rapidly becoming a laughing stock. The column by Michael Deacon (HERE) is amusing but has a serious point. Bernard Jenkins says the Leave campaign was always clear about leaving the single market (actually this is not true since Matthew Elliot's 1000 page tome about Brexit before the referendum gave the Norway option as one possible outcome on page 232 HERE) but as Mr Deacon points out this is just one of the claims made by Brexiteers but the only one they are standing by - ignoring the £350m a week for the NHS, VAT on fuel and others.

Then BoJo is offering to help Turkey join the EU after scaremongering about the very same thing in the campaign while David Davis seems to think coming repeatedly to the house to say the same thing amounts to a policy and said:

“The mandate for Britain to leave the EU is clear, overwhelming and unarguable. No one should seek to find ways to thwart the will of the people.”

Clear?  Overwhelming? Unarguable?  What is surprising is that the government thinks it has a mandate for "something" but doesn't really know what.  The decision on the 23rd of June is taken as the settled will of the British people on a matter of stunning complexity but it has taken three months and all the experts in government and still we have no idea what we are going to get.

CONSERVATIVES PLEDGED TO PROTECT SINGLE MARKET ACCESS

The Conservative 2015 Manifesto (HERE) says on page 72 that they will "safeguard Britain's interests in the single market".  In all of the aftermath of the vote many people have overlooked this but I think they should be reminded this was the manifesto they all stood on.

PARLIAMENT PUSHES FOR PROPER SCRUTINY

On Monday during a visit to Denmark and Holland, Theresa May ruled out giving MPs a vote on triggering Article 50 (HERE) while David Davis (one of the bulls in the china shop according to Phillip Hammond) warns the EU not to "punish" the UK.

Then we had a debate in the house where Mr Davis volunteered to come and make a statement that turned out to be virtually a repeat of the statement he made in early September (HERE).  MPs on the remain side were not impressed and pushed for parliament to be given a primary role in debating and voting on the terms of exit (HERE).

I think the legal challenge and pressure from MPs will eventually force the government to get parliamentary approval for its negotiation position.  It cannot keep it secret and as Andrew Tyrie says it would be absurd for the British people to find out their own government's position from the EU, as they certainly will as soon as negotiations begin.

THE POUND CONTINUES TO FALL

Gerald Lyons, the former advisor to Boris Johnson, was on Radio 4 this morning saying the slump in the value of the pound would have happened anyway regardless of the referendum result. He joined David Davis and Mervyn King (HERE) and others in welcoming Sterling's decline in value. The Telegraph also says the fall is overdue (HERE).

This is going to push up the cost of imports and make our current account deficit even worse. Exports become cheaper but whether this will have a significant impact is debatable.  It is all beginning to look like the politicians have started something that they may find hard to stop.

Sterling is trading well below $1.23 this morning and shoppers are being warned of price rises to come (HERE).

THE LEGAL CHALLENGE SET OUT

Bindmans's, acting on behalf of a few concerned citizens and paid through a crowd funding scheme, are trying to force the government to obtain a vote in parliament before triggering Article 50.  I think there are good grounds and these are set out in  a letter sent to the government in July.

Read the letter HERE

The case is due to start this week in the high court in London.

NOW WE GET SELLERS REMORSE

Charles Moore (HERE) and Steve Hilton (HERE) have both written pieces this weekend about Theresa May's conference speech.  Both are highly critical.

Moore thinks we voted for less government and is unhappy that May seems to be advocating more interference with workers on company boards and so on.  Hilton is unhappy about the way policy is developing on controlling immigration.

I think we will see a lot more of this as policy detail comes out and negotiations with the EU gets under way.  Leavers voted for all sorts of different things and it is impossible to satisfy all of them with the same deal.  Remainers of course won't be happy with any deal.

One can easily foresee a majority against any specific form of  Brexit.

Update:  Alastair Heath at The Telegraph is also regretting it (HERE)

NEW YORK TIMES THINKS THE BREXIT PARTY ENDED THIS WEEK

The New York Times has an article (HERE) suggesting the fall in the pound's value this week to a record low marks the end of the party for Brexiteers.

“The world believes that the U.K. is going to be poorer in the future, and find it more expensive to trade,” said Paul Johnson, the director of the Institute for Fiscal Studies, an independent research institution in London. “Essentially, the world is betting against the pound.” And against the British economy.

Adam S. Posen, a former member of the rate-setting committee at the Bank of England, and now president of the Peterson Institute for International Economics in Washington said,

“Somehow, a whole combination of people were in denial up until now,” 

“There were the people who thought Brexit would be reversed, there were the people who delusionally thought there would be a soft Brexit, and all the northern Europeans would be nice to them. And there were people who believed that this crew in charge of the British negotiations were somehow going to strike a good deal. All of the delusions have run out of material.”

Strange how sometimes it's good to see how others see us.

NOT EVERYONE THINKS THE REFERENDUM WAS DEMOCRATIC

There is an interesting article by a Harvard professor (HERE) questioning whether referendums are really democratic. He thinks not and calls the EU referendum Britain's "democratic failure".

His argument is that the whole subject was too complex, the threshhold too low and it was essentially hijacked by people who persuaded voters to cast votes against there own best interests.  Thought provoking even if you might not agree.

The New York Times has another article HERE.

CABINET SPLITS BEGIN TO APPEAR

The Telegraph (HERE) is reporting that Phillip Hammond is under pressure in cabinet for being too pessimistic about Brexit. An unnamed cabinet minister says Hammond should watch his back and may lose his job.

There is a particular problem with Liam Fox who thinks we should leave the customs union and Hammond who can see the problems this would create for British industry (see letter from the CBI HERE).  It seems the issue is so intractable either Fox or Hammond may be forced out over it.

The Mail on Sunday (HERE) had an article which apparently give Hammond's view of the three Brexiteers. It's not very flattering to say the least.

This is always the problem with those who call for something out of faith alone, they cannot listen to reasoned argument and believe they are right even in the face of mounting evidence to the contrary.

Update: Politic Home reports on the growing rift (HERE).

PARLIAMENT RAISES THE STAKES

Finally, parliament is beginning to work exactly as it should.  A cross party group of MPs is demanding the house has a vote on the terms of Brexit and there is said to be growing outrage after last week's Tory conference that the government intends to trigger Article 50 in a hard Brexit without consulting parliament (HERE).

Milliband said, “Having claimed that the referendum was about returning sovereignty to Britain, it would be a complete outrage if May were to determine the terms of Brexit without a mandate from parliament".

Tory MPs joined forces with former leaders of Labour and the Liberal Democrats, the SNP and Greens to insist that parliament have a say and a vote, pointing out that, while the British people had backed leaving the EU, they had not chosen to leave the biggest trading market in the western world.

The legal challenge is due to be heard this week in the high court.

NOW JUNCKER IS BEING SUED!

British ex pats in Europe have launched a legal action against Jean Claude Juncker's presidential order blocking any early negotiations before Article 50 is triggered (HERE).

It looks like Brexit is going to be a bonanza for lawyers!

CBI SIGNS OPEN LETTER ON BREXIT

The CBI has sent an open letter to the government (HERE) pleading with them to ensure we retain barrier free access to the single market and claiming a hard Brexit would do "serious and lasting" damage to the UK economy.

The EEF and ICC (International Chambers of Commerce) and TechUK a lobby group representing the technology industry in the UK also signed the letter.

GOVERNMENTS LEGAL ARGUMENT ON ARTICLE 50 PUBLISHED

The government has now published the legal basis for its argument in next week's high court hearing (HERE).  Infacts pointed out that it doesn't address at all the main point that triggering Article 50 starts a two year clock running after which we will be out of the EU come what may.

This is fundamental because it is widely accepted that the royal prerogative is not used to override statute and the European Communities Act 1972 (i.e. statute) will effectively become redundant after we exit the EU.

One of the counter arguments by anti-Brexit lawyers is that we could trigger article 50 using the royal prerogative but afterwards parliament does not pass The Great Repeal Act in which case we are out of the EU but still bound by all its laws!

MERKEL CONFIRMS AGAIN NO SPECIAL DEAL FOR UK

Angela Merkel once again reaffirmed her absolute commitment to the four freedoms of the single market (HERE).

Speaking to Germany’s BDI industry lobby in Berlin on Thursday she gave a further indication that the U.K. risks a so-called hard Brexit, whereby it gives priority to controlling migration over seeking as much access as possible to the EU single market of some 500 million people. She said there will be no "easy negotiations".

Of course, much of this is positioning before talks really begin but she has been so clear about freedom of movement it is hard to see any climbdown on this at all.

The Maltese take over the EU presidency next year and their prime minister says Britain will be treated like Greece and will face a united front from the EU27 (HERE).  None of this looks good.

FINANCE JOBS WILL GO WHATEVER THE DEAL

The UK head of U.S. bank Citi said on Monday last week that jobs in London's financial sector would move to countries inside the European Union after Britain leaves the bloc, regardless of what deal is struck on access to the EU financial services market (HERE).

This on the basis that no economic bloc is going to allow its financial services to be supplied and dominated by a third country.  No matter what the deal, the EU will want to see most financial services moved inside the bloc where they can be regulated by the bloc. It makes perfect sense to me.

WORKING CLASS WILL PAY AGAIN

May in her closing conference speech this week said the working class paid the price for the financial crash in 2008-9. The tragedy is that it is they who will pay for Brexit as well.

Many of those who voted leave seemed to believe we will somehow be better off separating ourselves from our largest export market where there are no trade barriers.  They voted (apparently) as a protest at their own lives but leaving will only make matters worse.  No one has had the courage to explain this yet and perhaps they won't be able to until economic reality arrives in a year or two.

MAY'S CONFERENCE SPEECH

Full speech is HERE. Interesting bits are :

I will never allow divisive nationalists to undermine the precious Union between the four nations of our United Kingdom.

Our laws will be made not in Brussels but in Westminster. The judges interpreting those laws will sit not in Luxembourg but in courts in this country. The authority of EU law in Britain will end. 

Existing workers’ legal rights will continue to be guaranteed in law 

We have voted to leave the European Union and become a fully-independent, sovereign country. We will do what independent, sovereign countries do. We will decide for ourselves how we control immigration.

We are not leaving the European Union only to give up control of immigration again. And we are not leaving only to return to the jurisdiction of the European Court of Justice.

Mrs May talks of nationalism but isn't this what Brexit is all about?  And as for the rest it seems she is determined to get a hard Brexit. There is no way we can get full control of our borders and laws without a complete separation.

Denis McShane (HERE) has an interesting article in The Independent about Mrs May' speech and the fact she has little foreign policy experience and sees the world through home counties conservatism lenses.  He also noted the reference to not allowing the ECJ any jurisdiction over British courts and concludes we will not have any sort of membership of the single market.

TELEGRAPHS 100 REASONS TO CHEER BREXIT

The Telegraph has published a bizarre list of reasons (HERE) why we should cheer Brexit including being able to buy extra inefficient vacuum cleaners and bent bananas. I suppose I shouldn't be surprised at the sheer silliness of it all but since the outcome is so serious for this country, I am.