Wednesday 18 January 2017

Theresa May's partial free trade fantasy

Beside the outright lie about the conduct of the EU referendum debate, the threat to turn the UK into a bargain basement corporate tax haven if she doesn't get her way and the numerous self-contradictory statements, Theresa May's Brexit speech contained something else that the mainstream media chose not to focus much attention on.

After explaining that her radical interpretation of Brexit means that she thinks she's got a mandate to drag the United Kingdom out of the Single Market, Theresa May went on to propose a new free-trade agreement between the UK and the EU. Part of this fantasy deal apparently includes negotiating tariff-free Single Market access for the financial services sector and other major corporations such as the motor industry.

Here's what she said:
"We do not seek membership of the Single Market. Instead we seek the greatest possible access to it through a new Free Trade Agreement.
That Agreement may take in elements of current Single Market arrangements in certain areas - on the export of cars and lorries for example, or the freedom to provide financial services across national borders - as it makes no sense to start again from scratch when Britain and the remaining Member States have adhered to the same rules for so many years."
Essentially what Theresa May is saying is that if the industry has the financial power to either donate vast sums to the Tory party (like the financial services sector) or to hold the UK government to ransom by threatening to up sticks and relocate their factories into the single market zone (the car industry) then Theresa May and her Brexiteers are going to try to negotiate special Single Market access for them. But if, on the other hand, your business doesn't have such financial might (small and medium sized businesses, start ups, independent traders ...) screw you! You're probably going to end up paying tariffs if your business involves importing or exporting goods, materials or services from/to EU countries. 

Even the justification for this haphazard approach is absolutely ridiculous. If Theresa May admits that it makes no sense to tear up the rules for the financial services sector or major corporations like the motor industry, how on earth does it make sense to force Britain's small and medium sized businesses to "start again from scratch"?

The idea of negotiating Single Market access just for powerful corporations with the financial might to either bribe or coerce the Tories into defending their interests, whilst leaving the rest of the economy to suffer the threat of import and export tariffs is utterly appalling. It's yet another example of the Tory party deliberately re-engineering the economy in favour of the largest corporations at the expense of other sectors of the economy.

The idea of Theresa May exempting the bankers and corporate fat cats from the economic self-harm of quitting the Single Market should be appalling to all but the most rabidly right-wing of British people, but it seems unlikely that it will actually ever actually play out that way because the EU are highly unlikely to allow the Tory party to set about picking and choosing which sectors of the British economy get to retain access to the Single Market.

The problem of course is that if the EU say no to this Tory effort to cherry-pick the benefits of Single Market access for favoured sectors of the economy, Theresa May and the Chancellor Philip Hammond have made it pretty damned clear that their alternative plan is to turn the UK into a savagely right-wing corporate tax haven, and point the finger of blame at the "nasty, horrible, evil foreigners at the EU" while they're doing it.

Some of us warned about this kind of outcome all along. As many flaws as the EU has, leaving the exit process in the hands of the fanatical right-wing of the Tory party is absolutely certain to be worse.

Unless something is done to stop Theresa May's madness, the UK is either going to end up as a deeply divided country where only those with sufficient wealth to bribe or coerce the Tory party get to benefit from Single Market access, or even worse, we end up as some kind of isolated and almost universally despised bargain basement tax haven economy intent on stealing the wealth of other countries rather than actually generating our own.

I wonder if this kind of hard-right Tory fanaticism is what most Brexiters had in mind when they decided to vote for Brexit and essentially sign a blank contract with the Tory party to just make it up as they go along?

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