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Brexit - EU Affairs

There is no way that the UK could leave the EU without a deal

Emmanuel Macron visited Germany hoping to persuade the weak and embattled Chancellor Merkel to join with France in his plan for a new Euro zone budgetary regime. He received a luke-warm reception for his plans and left with a fig-leaf statement of agreement in principle for a very diluted version of what he was proposing until recently.

He had originally being a champion of a Euro Finance Minister, a Euro Budget, a Euro fiscal policy, Euro bonds, a Euro bail-out capacity, and a broadening of the power of a Euro finance ministry to intervene in and to control state policies in the broad interest of Euro stability.

Macron wants to make France great again by entering into a power-sharing dual alliance with Germany to dominate the EU and to extend that alliance’s power by concentrating further political and economic power in the EU institutions to be controlled by them.

He hopes to kick-start a renewed push towards political and economic integration in the EU based on this Franco-German diarchy. He speaks of making the EU “sovereign”. This is code for taking away the sovereign rights of the member states and vesting them in a union dominated by France.

His naked ambition is, however, plain for all to see. To many in Germany, it is simply an opportunist attempt to elevate France politically and economically to a status of equality with Germany – when in fact there is no such equality. There is in fact an unwritten rule of EU diplomacy under which Germany accords the French the appearance of equal status to conceal German economic power and to conceal French economic weakness.

But to other EU member states the Macron plan poses a threat of subordination.

According to the Financial Times, the finance ministers of twelve member states, including Ireland, have now written to the President of the Eurogroup indicating their dissent from Macron’s proposals for a Euro budgetary zone.

These countries are the Netherlands, Belgium, Luxembourg, Sweden, Denmark Finland, Austria, Ireland, Latvia Estonia, Lithuania and Malta.

A nervous Germany, sensing that Macron was over-playing his hand, immediately responded by pointing out that the ideas were simply for discussion.

This dissenting voice of what has been termed a “second Hanseatic League” is not what France had hoped for and is exactly what Germany feared.

In addition to the new Hanseatic League of smaller liberal states, there is a third significant bloc to be reckoned with -  the Visegrad bloc consisting of the Czech Republic, Poland, Hungary and Slovakia.

The Visegrad governments are deeply suspicious of any attempt by Macron to increase the powers of the EU under a Franco-German diarchy. Their centre-right governments strongly oppose any increase of EU sovereignty in the wake of the EU’s migration policy fiasco.

Italy and Spain are in political turmoil. A bruised and battered Greece is emerging from its own crisis.

We are reminded of the French government’s huge reluctance back in 2004 to sanction the eastern enlargement of the EU on the basis that enlargement should only follow further integration rather than make it more difficult to achieve.

On these matters, the French foreign ministry based on the Quai D’Orsay has been consistent at least. They used phrases like “Old Europe” and “new Europe” to voice their concerns about their loosening grip on dominance of the Union.

Jean Claude Juncker made some friendly-sounding remarks on the Irish border question in Leinster House on Thursday. Guy Verhofstadt, the EU Parliament spokesman on Brexit, had made similarly re-assuring  remarks when he addressed the Houses of the Oireachtas last year.

But what does it all add up to? As has been pointed out the real negotiations up to now have been going on between UK ministers rather than between the UK and Michel Barnier.

Is there any reason to believe that the UK and the EU 27 will not behave in an elaborate game of chicken over the coming months – each side flirting with the possibility of a no-deal hard Brexit?

The direct threat by Airbus made this week to move its operations out of the UK if there is a customs border regime between the UK and the EU is a sobering thought for many in Britain.

It seems to me that there is simply no way that the UK could leave the EU without a deal. It hasn’t built the infrastructure for border checks. It hasn’t prepared for any of the physical or legal consequences of a hard Brexit. So it seems that there will be no hard no-deal Brexit

Although we rarely hear the phrase “no deal is better than a bad deal” on Tory lips any more, the underlying thought hasn’t gone away, you know.

It is in that context that the back-stop commitment on the Irish border is re-assuring, as was Juncker’s claim that it would not become collateral damage in an eleventh hour deal with the UK.

We are probably approaching a situation in which the North’s catholic population will outnumber the protestant population. We are nowhere near the catholic voting population out-numbering the protestant voting population. That could take ten or twenty years.

But sensible unionists in the North are beginning to ask the question as to whether there is some political arrangement other than a unified, unitary Irish republic which would better serve their interests than the existing political order.

Could we envisage a situation in which the two parts of Ireland formed a loose confederation to share as partners in a single membership of the European Union? Could Northern Ireland in such a scenario continue to have some linkages with Britain?

These ideas may seem far-fetched or difficult to some. But they are worth discussing on the basis of being ideas rather than as threatening or disquieting  proposals. After all there is a clear majority on each side of the border for continued membership of the EU.

In the Seanad last week, I raised another issue which hasn’t been discussed extensively in the context of the Brexit debate.

I posed the question: Will the UK post-Brexit be free to engage in state aids which would be prohibited at the moment under EU law?

If the answer is Yes, will there not be a scope for massive trade and market distortions on this island with UK state aids being liberally doled out in the Northern Ireland economy?

If state aids are not to be permitted in Northern Ireland, will they be lawful in Britain post-Brexit?

Does regulatory alignment in Ireland exclude state aids in both parts of the island?

How would such an aligned regulatory regime  lie with the fairly poor economic prospects for the North in a hard-Brexit scenario?

These issues haven’t gone away you know. And they can’t go away unless there is some form of customs partnership and regulatory alignment that would send a shiver up the spines of Boris and Jacob.


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