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The Art of the No-Deal Brexit, Boris Edition

Published 07/25/2019, 12:00 PM
Updated 07/25/2019, 01:54 PM
The Art of the No-Deal Brexit, Boris Edition

(Bloomberg Opinion) -- “They call him Britain Trump!” Such was the U.S. president’s ungrammatical reaction to Boris Johnson’s nomination as the U.K.’s new prime minister. “They like me over there…He’ll get it done.” If “it” means channeling the fire and the fury of Trump’s hostile rhetoric, without really guaranteeing much in the way of concrete results, this analysis is eerily accurate.

What it does not mean is that the 27 other member states of the European Union will erase their red lines to give Johnson a new Brexit deal before Oct. 31. Another extension to the departure date is likely, and with it the risk of an emboldened populist surge.

Behind the canned congratulations issued by European officials and heads of government, Johnson clearly encapsulates everything the Brussels establishment despises: Open hostility to the European project, combined with total unpredictability on policy. The words “dangerous” and “clown” are often used to describe him. Maybe there is a Machiavellian grand plan percolating in Johnson’s mind – but, like Trump, the words and actions are all we really have.

And they have hardened in recent months. Johnson has declared Theresa May’s Brexit deal “dead,” has rejected any form whatsoever of the “backstop” safety net to avoid a hard Irish border, and wants to leave the EU on Oct. 31 – “do or die.” This is a positively Trumpian reinvention since March, when Johnson voted for May’s deal.

European officials aren’t blind to Johnson’s most obvious constraint, though: the same parliamentary arithmetic that brought down his predecessor. The EU Commission, the Parliament and the Council – respectively the executive, the legislature and the national member states – endured the years of negotiation that resulted in May’s Brexit deal last year, only to watch it shot down in flames by a fractious U.K. parliament. That parliament remains unchanged. Worse, Johnson’s working majority could actually shrink to just one seat by August. No amount of hardball tactics can hide that.

Hence why the EU is showing no sign of deviating from its red lines, as reiterated by its Parliament’s Brexit Steering Committee on Wednesday: Protecting the rights of EU nationals, Britain’s settling of its 39 billion-pound ($48.7 billion) bill, and a form of the Irish backstop that protects both the Good Friday Agreement and the integrity of Europe’s single market.

Sure, there is wriggle room. A rewritten political declaration on future ties and a rejigged backstop that would only keep Northern Ireland – rather than the U.K. as a whole – in a customs union are being offered to British negotiators, according to my Bloomberg News colleague Ian Wishart. Allowing regulatory goods checks in the Irish Sea, and more ways for the U.K. to exit backstop arrangements, might be other ideas.

But none of these match with Johnson’s more aggressive recent rhetoric. Even optimists in Brussels who believe he will have more success than May in striking a deal that’s palatable to both sides reckon he will have to eventually back down on his most recent positions.

That includes the threat of “no deal,” which Johnson is brandishing even at the risk of suspending parliament and triggering a constitutional crisis. The idea that this is leverage for the U.K. seems far-fetched. It’s reminiscent of the Mel Brooks movie “Blazing Saddles,” in which the sheriff holds a gun to his own head to hold his rivals to ransom. If the U.K. is willing to risk a “significantly negative” credit hit and another domestic political crisis in order to unilaterally scrap trading arrangements with its biggest partner, perhaps it’s not the kind of ally that’s worth big sacrifices.

Achieving a conclusion to the Brexit drama based on Johnson’s current pitch looks difficult to achieve within his self-imposed 100-day limit. Barring a Damascene conversion in Westminster to a slightly tweaked deal, another extension is therefore likely.

But that could produce some toxic effects of its own. If Johnson decides to take the issue back to the Brits with a general election, campaigning on a “do or die” Brexit platform to align with the likes of Nigel Farage, he might find willing followers: A BMG poll this month found 38% of Brits favored leaving the EU without a deal if there was another referendum on the question. One hundred days of bullying in Brussels may be only the start.

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