How bad would a hard Brexit really be?

This account has some gloomy rhetoric, but doesn’t drum up such an awful scenario, for instance:

Among the little-noticed impacts: U.K. citizens and businesses will no longer be able to register internet sites using the .eu domain, and any U.K. entities that currently have such sites will not be able to renew them.

As mentioned, no doubt British truckers would be badly hurt, but what else?  This sounds correct to me:

Custom delays could create food shortages. The U.K. is vulnerable because an extreme heat wave and summer drought caused by global warming have already reduced food output.

Tariffs would be reimposed. They are as high as 74 percent for tobacco, 22 percent for orange juice, and 10 percent for automobiles. That would hurt exporters. Some of that pain would be offset by a weaker pound.

Tariffs would increase prices of imports into the U.K. One-third of its food comes from the EU. Higher import prices would create inflation and lower the standard of living for U.K. residents.

Is this the biggest danger?:

Health Secretary Matt Hancock has warned medical drug companies to expect six months of “significantly reduced access” to the main trade routes between Britain and Continental Europe if there is a no-deal Brexit.

This one seems exaggerated:

“Bodies may remain uncollected and children might miss exams due to gridlocked roads in the event of a no-deal Brexit”, the report said.

So people, what’s the deal?  Put aside the longer and medium-term effects on gdp and the like, what are the greatest short-run dangers of a hard Brexit in the weeks to come?  Or is it a big, overstated worry, the new Y2K?


Y2K worry. The iron rule of the last 25 years has been that the political class is always wrong, and most wrong on the things they are most sure of.

So, the 'political class' of Kent - do you think they are wrong? Even based on their actual experience? Just to requote from below without the link - 'The county decided to act in the knowledge of the impact of congestion on the county’s services and businesses, following road closures for 24 days in 2015 because of a strike in France.'

There may be a long line of trucks, but I think the idea that there will be food and medicine shortages is absurd.

Depends on how one defines food shortage. A lot of the food being imported is fresh - it cannot sit in a truck for three days and still be sold. Whether food shortage is exaggerated or not depends on what one thinks about fresh produce, for example. Obviously, no one will starve. On the other hand, this actually happened in the UK - 'KFC lovers are being urged not to call the police over the fried chicken "crisis".

The fast food chain closed half its 900 UK outlets after "operational issues" with its new delivery firm DHL.

"For those who contacted the police about KFC being out of chicken...please STOP" officers in Manchester pleaded.

Police in London joined them in tweeting the chicken shortage was "not a police matter" but neither force could confirm if it had received calls.' And note that the problem was a logistics issue - DHL was not able to meet the requirements involved in handling timely deliveries - 'To recap how all this began, KFC moved distributors at the end of last year, choosing DHL over its long-term partner Bidvest. On February 14, the day DHL took over, several factors – including DHL's decision to use a single depot, a motorway crash on the M6 right next to it, and an apparent lack of contingency planning – caused a backup of deliveries. This became acutely visible the following Sunday and Monday (March 18-19), when KFC had to close over 600 of its restaurants due to depleted supplies of ingredients. It has spent the last several weeks slowly reopening them.'

As for medicine shortage - sadly, far from absurd. You may want to read for yourself, but currently, the British government is actually forcing various NHS trusts to not publish any information publicly. Again, the main problem is disruption to finely tuned supply chains.

Or as then Brexit secretary Dominic Raab said early November 2018 - 'We are, and I hadn't quite understood the full extent of this, but if you look at the UK and if you look at how we trade in goods, we are particularly reliant on the Dover-Calais crossing.'

It's remarkable how much clockwork_prior has invested in Brexit going poorly.

Especially considering that I fully support Brexit, and if it happens on April 12th with no deal, well, about time. Which is no surprise, one trusts - I have been consistently pro-Brexit since the referendum in this comment section.

Almost as if I am actually trying to describe the results of a policy I personally favor (and March 29th is still actually possible - fine by me too), instead of living in a typical Brexiter fantasy land.

It helps that I am not a British citizen or living in the UK - for the people I know who are, this is going to cause a number of problems. A couple of British citizens point out that this is not a game and that many British citizens will be affected, but that is their mood affiliation, not mine.

However, the schadenfreude that will likely result after the UK gets to deal with American trade negotiators after taking back control and without being a part of the EU as a bloc - yes, I am looking forward to that. However, in Brexiter terms, that would be an example of Brexit going swimmingly, I believe, without the EU interfering.

The tariffs and shortages are assuming that the UK still chooses to buy from the EU. The U.S. has offered to take up the slack in that trade probably with a better trade policy than the EU offers.

A hard Brexit offers freedom whereas a "soft" exit offers endless entanglements and punishment from the EU.

'The U.S. has offered to take up the slack in that trade probably with a better trade policy than the EU offers.'

Well, that would certainly take care of the fresh produce problem, wouldn't it? Not to mention car parts made by European suppliers for European companies manufacturing cars in the UK are to be had from the U.S. with just a finger snap, undoubtedly. How much spare manufacturing capacity do you think exists in the U.S., and what is transport time from a Midwest supplier to Oxford? And what makes you think that BMW will keep making Minis in Oxford with American supplied parts, insted of relocating to somewhere in the EU? The British problem is likely to be shortages in other areas - such as jobs in the auto industry. Sadly, America doesn't seem to have anything much to offer in that area - after all, Vauxhall (owned by GM) was sold to the French company PSA. Who also just might consider relocating production - you are aware that Opel (also formerly owned by GM) just happens to offer much the same as Vauxhall. Makes you wonder what decision a French manager might make in terms of using Opel plants in the EU to manufacture Vauxhall cars (or not - - the right side drive aspect would likely come into play, as Vauxhall is definitely a 'domestic' British producer in a sense that Mini isn't).

'probably with a better trade policy than the EU offers'

Um, the EU trade policy among its members will look better than anything the U.S. proposes - unless the U.S. is prepared to offer full access to the American market without tariffs or paperwork, and a say in determining American trade policy.

You are a glass half full kind of person. There is no answer that will make you happy. so be it. Shipping time to England from the U.S. is 7 hours. In the U.S. I can get fresh fruits and vegetables any day of the year. Had corn on the cob two days ago. Fresh berries are available in every supermarket. Believe it or not these problems were solved years ago now it is simply a question of the government bureaucracy getting out of the way.

'Shipping time to England from the U.S. is 7 hours.'

Well, sure - but how many factories use airfreight to ship 5000 radiators a day. Or tomatoes - you are aware of the volume and weight of tomatoes grown in Spain that go to the UK, one assumes - meaning the idea that you could air freight them from Florida (leaving aside that the actual airfreight infrastructure does not even exist) is hilarious, but this is the MR comments section.

'Believe it or not these problems were solved years ago'

Amazing how you completely ignored what was actually written concerning manufacturing cars.

The air freight infrastructure is already there. There is a reason I stated that we get fresh fruit and vegetables even in the winter. Every airplane that takes off from every airport has space and weight available top move freight. That is why it is profitable to ship fdruit from South America and Hawaii to the states and still be able to sell them in Walmart for the same price they would be if they were in season here. Everyday a couple hundred planes leave the states and fly to Europe and every flight has space for freight and the airlines would love to market it to you..

Brexiters like it hard, long and drawn out. It might be a bit clumsy at first with multiple tries but in the end they all end up with egg on their faces. Remainers, on the other hand, don't like to pull out.

The political class in the UK is very much for Brexit. It is a project of the elites targeted against the upper middle class, playing on working class resentment of the upper middle class for support.

How do you draw that conclusion?

It seems like if that were the case, most political representatives would have simply voted to exit the EU in the Commons, not delegated it, eventually to a public vote.

If the political class and the majority of the people (the working class and lower+middle middle class) support a project, then it just happens, and there is no need such a complex process to lead to a "project targeted against the upper middle class", certainly not one subject to continual agonization and turmoil.

Consequences? Probably a few changes here and there, some negative some positive.

In the rest of the EU? In Brussels? Is this a turning of the tide, where the influence, scope and breadth of the EU begins to shrink? What other places will push harder for better terms?

Maybe the alternative isn't some utopian union of economies and hearts. Maybe the vigorous debates, the parliamentary battles are the healthy polity, as opposed to France openly discussing opening fire on their own citizenry. Maybe the Brits are the lucky ones with the responsive political system, where the pressures and tensions get worked out in the political system as it is designed to be, as opposed to the streets.

The intricate rules about shipping pallets are somewhat illustrative of utterly missing the point. Great idea and all that. Maybe good for shipping weaponry to use on your citizenry and for hauling away the bodies.

'as opposed to France openly discussing opening fire on their own citizenry'

Let us know when the French have a bunker set up to deal with the effects of Brexit - 'On Thursday it emerged that the Ministry of Defence has set up a bunker underneath its main building in Whitehall to coordinate any military response to Brexit.'

I suspect the French don't have time to deal with Brexit. They have real problems.

Let me quote Brexit secretary Dominic Raab again - 'We are, and I hadn't quite understood the full extent of this, but if you look at the UK and if you look at how we trade in goods, we are particularly reliant on the Dover-Calais crossing.'

You do know where Calais is, right? Or how Calais, like Kent, seems to be much more aware of the reality of no deal Brexit than those in London or Paris.

"The intricate rules about shipping pallets are somewhat illustrative of utterly missing the point. Great idea and all that. Maybe good for shipping weaponry to use on your citizenry and for hauling away the bodies."

Not sure, but i think the US has the same rules on shipping pallets.

For example, the asian emerald ash borer is believed to come into the US and probably the EU on/in shipping pallets. The cost to the US economy of that invasive pest is billions per year.

Of course, States establish similar interstate restrictions, at times with border inspections. California and Florida for fruits to try to prevent pest importation.

"Billions per year"?

Easily - 'The negative consequences of invasive species are far-reaching, costing the United States billions of dollars in damages every year. ... The most widely referenced paper (Pimental et al. 2005) on this issue reports that invasive species cost the United States more than $120 billion in damages every year.'

"the asian emerald ash borer ...The cost to the US economy of THAT invasive pest is billions per year."

"Consequences? Probably a few changes here and there, some negative some positive."

If California were to exit the US and become like Mexico, Canada, Brazil, the would be the equivalent of Breixt. Trade between the sovereign state of California, remember "states rights", and the US rest is about the same as UK to EU-27. California GDP is similar to UK. Immigrants to California from US is higher than EU-27 to UK, but British empire to US similar to international to California.

The biggest difference between UK and California going complete sovereign is the sea vs long land border.

The EU is merely the US 1950 crossed with US 1920s. Before the Civil War States saw themselves as independent, but allied, but afterwarrd, there was the central integration faction and the independence faction, resurging in the 20s. FDR reversed that and drove decades of greater integration.

In the 50s/60s US the backlash found root in the GOP but Reagan was an imperfect vessel, seeing the US as the power, not his adopted California.

The US had lots of migration from the 20s to 80s which madde State identity weaker than US identity by the 70s, for those who moved.

The EU has only had 25 years of that migration, mostlly younger people than in the US in the 20s to 40s. Younger adults oppose Breixt, and in 25 years, opposition to brexit and other migration limits in the EU will grow.

In fact, the UK brexit faction is similar to the California oppositionn to immigrants in the 30s, opposition to Oakies, Zoot suiters, etc.

Basically, to understand Brexit, imagine California leaving the US and becoming like Canada. Which was pretty much open border whenn I was born. Now its so much hassle, I might as well go to Cuba if I'm leaving the US.

???? There is a 310 mile border w the Republic of Ireland...sort of the heart of the issue....not that comparable to California, Oregon , Nevada

California should leave the United States, it's absurd that they voted for the Democratic candidate for President by a 40 point margin and must suffer Trump for 4-8 years. Californians and Unitedstatesians are very different.

Some friends there are stockpiling certain pastas and wines that may be unavailable post hard Brexit. One wonders what the Battle of Britain generation would think of this.

Are the Italians going to stop exports to the rest of the world because of Brexit. Think about it, even if for some reason they don’t want to sell directly to the British an intermediary could easily buy any pasta from them and then resell to the UK.

'an intermediary could easily buy any pasta from them and then resell to the UK'

Sure - but in the real world, and in the shorter term, the problem is in the delays involving massive congestion and the paperwork likely to be required on the part of the UK. As it is right now, a truck can load up with Barilla pasta in the is region (in Germany or France - makes no difference in which country the warehouse is located), and drive directly to the UK - probably taking something like 12 hours to arrive at Dover. After a no-deal Brexit, the optimistic planning suggests several days, with a lot of uncertainty - such as what would be the proper documentation involved.

Why would Brexit cause the UK to impose extra paperwork on pasta imports? I mean I suppose they could, but why would they?

Well, extra paperwork in the sense that pasta imports from the U.S. face more paperwork today, compared to pasta imports from anywhere in the common market, today.

Of course it is up to the British government to decide, so yes, they could leave everything as it is today in the future in terms of not checking imports. However, do note that meat imports will come with a tariff according to the UK, which means that if I am importing 40 tons of pasta in a truck, who is to say that 3 tons of that is not salami, which will be cheaper by the amount of the tariff (the numbers are not precisely fixed, but say half the price of a legal import).

Of course smuggling happens anyway, but currently, there is no economic incentive to smuggle salami into the UK. After a no-deal Brexit, there will be. That is just a trivial example, of course. Now multiply by just 1% of the trucks that go through Kent every day - that is more than 100 trucks a day. I am sure that a not small number of individuals are currently thinking how they can benefit from Brexit in such an enterprising fashion, though the majority are probably on the island of Ireland - and asking their parents or grandparents about how smuggling works for fun and profit. This was not a bad recent article -

'Now multiply by just 1% of the trucks that go through Kent every day'

To be clear, I am not talking about salami. Let us say the truck is carrying yogurt - the driver declares 32 tons, the truck is carrying 40. That is the sort of basic check that somebody will need to perform in the future, as it is not performed today. Particularly as the 8 tons comes with a significant discount (for fun, say 50%), means that the entire truckload comes with a non-trivial discount of over 6% compared to a legal import of 40 tons.

Since the point of the meat/diary tariffs is to protect British producers, of course the UK has an incentive to check each truck. Just as an importer has an incentive to have source there goods at a lower cost.

That's obviously insane. The British are going to impose huge costs on themselves in order to impose new protections to benefit British producers?? There's plenty of time for them to phase in tariffs. To do it overnight would be deliberate sabotage.

'The British are going to impose huge costs on themselves in order to impose new protections to benefit British producers?'

Tell that to the UK government, then - the Irish think this will be a disaster, obviously.

These are some numbers - 'The UK Government announced a mixture of tariffs and quotas on beef, lamb, pork, poultry and some dairy to support UK farmers.

Many agricultural tariffs are compound duties and include a fixed cost by weight e.g. 12.8pc on lamb, plus €171.30 per 100 kilos.

The UK proposals suggest tariffs ranging from approx. €1,500 per tonne on manufacturing beef up to over €2,500 per tonne on steak exports.'

"Well, extra paperwork in the sense that pasta imports from the U.S. face more paperwork today" Oh good, then they have a process set up already. Who knew the UK traded with other countries in the world? Not the anti-Brexters.

' Oh good, then they have a process set up already'

See below from someone who appears to actually have some knowledge in this area.

'Who knew the UK traded with other countries in the world?'

You do know that as of today, that international trade infrastructure essentially does not exist between Dover-Calais crossing, right?

'Not the anti-Brexters.'

Cannot speak for them, as I am pro-Brexit, as repeatedly noted in this comment section. In the past, using this text - 'I am completely pro-Brexit, feel that the UK has voted to enjoy all the privileges and benefits of being a non-EU member, and that the UK should continue to remain outside of the EU, as the majority of voters in the UK desired.'

You're probably right. The UK will go back to the stone age, just like they were before the EU came along to save them.

'You're probably right.'

About how a finely tuned EU wide logistics system will no longer function like a finely tuned EU wide logistics system for the UK after Brexit? Yep, probably right - do check the comment below from someone apparently involved in the UK car parts industry.

'The UK will go back to the stone age'

Of course they won't. Why should they?

'before the EU came along to save them'

Not really sure how to put this to you, but the British asked to join - more than once. The first time and second time, they were turned down by the French.

'The United Kingdom made its first application to join in 1961. It was quickly apparent that there was a danger of political isolation within Western Europe, Commonwealth states were rushing to do deals with the new bloc, and it had American support. This application was vetoed by the French Government in 1963 with a second application vetoed by the French again in 1967. It was only in 1969 that the green light was given to negotiations for British membership. The United Kingdom joined the European Economic Community (as it then was) on 1 January 1973 with Denmark and Ireland. This proved controversial at the time. The Labour party initially sought renegotiation of membership. This was toned down to requiring a referendum on whether the United Kingdom should remain part of the Community. This referendum was duly held in 1975 with a 67% vote in favour of continued membership.'

Guess which country appears publicly most eager to say goodbye to the UK today, by the way.

I can't say that they'll be NO issues, but there are 160 other countries who trade with the EU. I bet the UK can figure it out too.

Well, that generation are probably stockpiling medications. It is not a good time to be living in the UK and relying on a steady medication regime to keep you alive - of course, one hopes that will be an overstated worry. Though how many people want to bet their life on it?

After all, the competence of the UK government has been on public display for a while now, and one can be confident that such a situation would never arise, right?

'Tariffs would increase prices of imports into the U.K.'

Nope - the British government currently promises no or decreased tariffs on imported goods, except for a few agricultural products. 'The UK government may cut trade tariffs on between 80% and 90% of goods in the event of a no-deal Brexit, reports say.

Some tariffs would be scrapped completely, including those on car parts, and some agricultural produce.

However, 10-20% of key products would continue to be protected by the current level of tariffs, including some textiles, cars, beef, lamb and dairy.' I'm confident a public choice economist can explain why a government would attempt to keep political fallout through dramatically increased prices (or dramatically lower import prices in the case of meat) as minimal as possible.

'This one seems exaggerated:'

It applies to Kent, where the local council is extremely concerned with thousands of parked trucks making local movement impossible. This is just what Kent is planning in terms of schools - Nobody is expecting 10,000 parked trucks in Birmingham, by the way.

And this is not a theoretical 'overstated worry' for Kent (which of course is not the entire UK) - 'The county decided to act in the knowledge of the impact of congestion on the county’s services and businesses, following road closures for 24 days in 2015 because of a strike in France.

Industry, homeowners and tourist attractions all suffered, with miles of the M20 turned into a lorry park at an estimated cost to the local economy of £1.5m a day.'

Maybe a better source of information would be something like this, which talks about what the UK government is currently planning -

Particularly as so much information Americans seem to read is just not accurate. This except from The Balance link, for example, seemingly conflates two separate things - 'May's plan did not allow the U.K. to prohibit the free flow of people from the EU. That was the primary reason people voted for Brexit. They were concerned about an increase in refugees from Africa and the Middle East.' This is the actual number of Syrian refugees accepted by the UK, according to the BBC in April, 2018 - 'The UK has accepted more than 10,000 Syrian refugees in the past two and a half years - but analysis by the BBC shows large disparities in the numbers going to different parts of the country.' And the UK has had the largest number of non-EU immigrants since 2004, according to the UK Office for National Statistics. The UK has always been able to restrict non-EU immigration - it is just that somehow, people seem exceedingly confused about that simple point, for some reason.

Just noticed that The Balance article was updated March 19 - no wonder it seemed so outdated already. The 'Current Status' section lacks the current status, for example - tiered departure dates depending on what the UK does, for example. Ironically, whether the UK wants it or not, the EU has set the date(s) and conditions for a no-deal Brexit - regardless of whether Parliament rejects a no-deal Brexit as unacceptable.

And things like this are just moronic -'The United Kingdom would lose the advantages of EU’s state-of-the-art technologies. The EU grants these to its members in environmental protection, research and development, and energy.' It is possible that the author is talking about various EU grant programs in areas such as research or infrastructure, but who knows? Of course the UK can continue to buy any technology it wishes from any EU country (not the EU - that is simply nonsensical in the cited passage), state of the art or not. With information sources like these, no wonder some people sound clueless about Brexit.

The question about what impact there will be of a hard Brexit on the short term largely depends on the response of the EU. The most significant areas seems to be in transport. The EU could prevent UK planes from landing, or impose very significant customs checks on UK trucks and holiday makers. I think this would be seen to be pretty petty though by the EU. The idea that the supply of food or medicine to the UK will be disrupted seems pretty silly. Even if for some reason the EU banned exports to the UK (one of it's largest export markets so would cause very significant recession in the EU) the UK could easily buy substitutes from the rest of the world. I cannot imagine for instance the US would refuse to sell food to the UK. So I highly doubt the EU will ban food exports to the UK.

Longer term there is always the consequences of less trade for the UK with the EU, but even then it seems like sense will prevail after the emotions die down. The world consists of a lot more than the EU so any loss of EU trade can easily be made up from the rest of the world.

The biggest impact will probably be on the EU I think, as without the British there will be significantly more regulations. So the EU economy could grow even slower.

"Of course - the EU treats its members differently than its non-members. As the UK has decided to enjoy all the benefits and privileges of being a non-member of the EU, why should the EU continue to treat it as a member? "

Because it's not a socialist country and doing business with the citizens is not treated as a 'benefit' or 'privilege', but rather as a right. Or not? Are we back to socialism?

'Because it's not a socialist country'


'doing business with the citizens is not treated as a 'benefit' or 'privilege''

We are talking about international trade - do you think that American citizens have a right to do business with Cuba, Iran, or North Korea? They don't. And do you think that America treats trade with Canada and Mexico exactly the same as it treats trade with Brasil? It doesn't.

Assuming that this is the point you are trying to make - though what that has to do with socialism is baffling, to be honest.

"We are talking about international trade"

So what?

"Assuming that this is the point you are trying to make - though what that has to do with socialism is baffling, to be honest."

Socialism is defined pretty much as 'means of production are a property of state'. This directly contradicts the right to perform economic activities, which actually is part of different human rights lists. Considering trade as a 'privilege' means you are totally disrepectful of (a subset of) my right to perform economic activity.

'So what? '

Well yes, this is the MR comments sections - maybe you could work in an angle about genetic inferiority too.

'This directly contradicts the right to perform economic activities'

You mean that poppy farmers in a place like Columbia should be allowed to sell their product world wide, since any other perspective would be socialism? Um, OK.

'Considering trade as a 'privilege' means you are totally disrepectful of (a subset of) my right to perform economic activity.'

See above. No one cares about your 'right to perform economic activity,' by the way.

However, the benefits and privileges of EU membership include the right of all EU citizens to live and work anywhere in the EU. The British government has just decided to revoke that right in the case of its own citizens in the EU and for EU citizens in the UK, in case you were unaware of that fact.

"Well yes, this is the MR comments sections - maybe you could work in an angle about genetic inferiority too."

You tried to point out that it's different because it's "international" trade. The question "so what" was meant exactly as "why should we treat international trade differently as 'privilege' rather than 'right'. I'm not sure what you are reacting to, I asked a normal question and you are responding with something about 'genetic inferiority'....

"You mean that poppy farmers in a place like Columbia should be allowed to sell their product world wide, since any other perspective would be socialism? Um, OK."

Yes, that's exactly what I mean. If you consider this as his *right*, it doesn't mean that the governments cannot ultimately forbid such trade. But it's their duty to give good reasons why they do so - as they should do anytime they wish to restrict any rights. If you consider it a privilege, than you are essentially not respecting the rights of the columbian farmer (and US citizens), and your disrespect goes exactly along the line of socialism.

"See above. No one cares about your 'right to perform economic activity,' by the way."

It's part of list of human rights in my country. Along other things like freedom of speech. If EU is a place where no one cares about my basic rights, that's quite a good reason to leave it, isn't it?

"However, the benefits and privileges of EU membership include the right of all EU citizens to live and work anywhere in the EU. The British government has just decided to revoke that right in the case of its own citizens in the EU and for EU citizens in the UK, in case you were unaware of that fact."

You cannot 'revoke' the rights, people are not property of a government that gives them rights. People _have_ rights, the governments are there to protect their rights (and unfortunately very often limit them from exercising their rights in ways that are not justified).

Yes, British government is planning it's fair share of abuse. That's a separate question to whether trade is a right or privilege.

'It's part of list of human rights in my country'

Interesting - what country do you live in?

'You cannot 'revoke' the rights, people are not property of a government that gives them rights.'

You seem quite confused, to be honest. But try this - go to another country without a visa, open a business, and then tell the authorities you have a right to be in their country and open a business as a defense to deportation. They won't care. I will even venture to guess that would apply to whatever country you live in too.

Czech republic. List of human rights, paragraph 26 - everybody has a right to freely choose employment and preparation ring for it, as well as right to do enterpreneurship and perform other economic activity.

You seem to think we should discard this paragraph. Correct?

"You seem quite confused, to be honest. But try this - go to another country without a visa, open a business, and then tell the authorities you have a right to be in their country and open a business as a defense to deportation. They won't care. I will even venture to guess that would apply to whatever country you live in too."

Doesn't that show that countries are generally quite bad in respecting human rights, especially the ones connected to economic activities? Just wondering, do you also make a difference between 'domestic' freedom of speech and 'international' freedom of speech? Like you don't have a right to talk to foreigners, that's a privilege..? Or right to a life (i.e. not being killed) - like it's a *privilege* we grant to citizens of other countries that 'we' would respect them?

Or do you limit this 'privilege' thing just to 'economic rights'? It seems to me so. And that's exactly socialism.

'Czech Republic'

So, basically similar to what the German Grundgesetz says in terms of employment, and somewhat similar in terms of economic activity. (Differences too, of course.)

'Doesn't that show that countries are generally quite bad in respecting human rights,'

Not in my opinion, but I am an American, and completely comfortable with the idea that a government gets to decides who lives and works within their own borders. This is quite distinct from the EU concept over the past generation, of course. And I do not feel that because I live in Germany, I have any right to live and work in the Czech Republic. Of course, that is different from how an EU citizen is treated, but I am not a citizen of the EU. And soon, neither will any British citizen.

'Just wondering, do you also make a difference between 'domestic' freedom of speech and 'international' freedom of speech?'

It is an interesting question, and one I have talked about here in the past. The simple answer is yes (to a distinction). If Germany wishes to say it is illegal to advocate genocide as a political program, I have no problems with that. This is based on the slippery slope idea - Germans have already demonstrated that will commit genocide as a political program, and I have no problems with Germany trying to prevent another genocide. However, I think it is absurd for Canada to have such hate speech laws. And of course, the 1st Amendment of the Constitution only applies in the U.S., where one is free to argue for genocide as a political program - a right of speech I fully support in terms of Americans. It is a bit complex and nuanced, admittedly. Take France - the French were more enthusiastic about deporting Jews than the German authorities were prepared to deal with - but I think it is up to the French to decide how they look at free speech when it comes hate speech involving genocide.

'And that's exactly socialism.'

Since this started off with me thinking you were an American (and Americans are currently very confused what socialism is and isn't), I think we will just leave this point, though I would mention that from my understanding of East Germans and other East Europeans, socialism is often used to describe how the entire state worked, not just an economic system.

They missed the human sacrifice, cats and dogs living together, and the mass hysteria.

+1, that is the proper response and context for the Brexit hysteria

But the long run, say economists, is a series of short runs. What was the US Great Depression except a two year bank crisis (1931-33) writ large? It was really nothing more than mass hysteria. Yet it brought along permanent changes. Same with the assassination of Archduke Franz Ferdinand of Austria on 28 June 1914 in Sarajevo. Royalty die all the time, so why the big concern over such a trivial matter? I hear butterfly wings flapping...

What would happen if May fell on her sword, took the blame for the whole mess and resigned, telling Parliament to revoke Brexit? Would she get away with it?

That would contradict decades of empirical proof about May having perseverance as her main quality.

Anyone who isn't a sociopath (as most politicians kind of are) would have already resigned. It is clear she is being used as a shitstorm receiver and another sociopath will take her seat when this shitstorm stops.

May is not the person who decided on Brexit, or even the vote on Brexit, in-fact she was pro-remain, so it is hard to see how her leaving would suddenly change parliaments view and get them to vote to stay, even if this could be sold to the electorate.

The border between Northern Ireland and the Republic of Ireland runs mostly on Catholic-dominated land and a hard Customs border would be staffed on one side by British officials who would definitely want military protection. British troops + Catholic public = dead people, again and again, for decades.

This is a major issue that requires an extremely careful solution. I haven't heard a good solution yet.

The UK always allowed free passage by Irish citizens into UK, and they have said they don’t intend to change that. So why would the Uk have to police the border?

'The UK always allowed free passage by Irish citizens into UK'

And a generation ago, they generally went through a border checkpoints first. That has changed in the last 2 decades.

Generally, the problem involves organizations that tend to use I, R, and A in their name. The UK police have been warning about this in general for a while, by the way. And a generation ago, the British consistently blamed Ireland for not doing enough to keep the border secure enough to stop such activities from occurring.

One should add that the English seem profoundly unconcerned about a return of the Troubles.

Here is an example of that, from early September, 2018 - '“I freely admit that when I started this job, I didn’t understand some of the deep-seated and deep-rooted issues that there are in Northern Ireland,” Bradley told House magazine, a weekly publication for the Houses of Parliament.

“I didn’t understand things like when elections are fought, for example, in Northern Ireland – people who are nationalists don’t vote for unionist parties and vice versa. So, the parties fight for election within their own community.

“Actually, the unionist parties fight the elections against each other in unionist communities and nationalists in nationalist communities.”' Northern Ireland secretary Karen Bradley

Just another example of the sort of competence from the UK government. There are plenty more - like the UK government awarding a contract to a ferry company without ferries being one of the funnier ones. With the added hilarity of that company apparently cutting and pasting a pizza delivery company's terms and conditions to put on their web site.

56 percent of NI voted to Remain, DUP only pol party opposed to Good Friday despite 20 yrs of success on both sides of border, Stormant non existent, SF doesn’t sit in parliament,....hard Brexit would be a disaster for NI and Republic

Absolutely it will be a bad result (hopefully not a complete disaster).

However, here is BBC Today presenter John Humphrys bringing up his idea of a solution to such problems - '“There has to be an argument, doesn’t there, that says instead of Dublin telling this country that we have to stay in the single market etc within the customs union, why doesn’t Dublin, why doesn’t the Republic of Ireland, leave the EU and throw in their lot with this country?”

Ireland’s Europe minister, Helen McEntee answered this way - “To suggest that we should leave? Ninety-two per cent of Irish people last year said they wanted Ireland to remain part of the European Union and in fact since Brexit that figure has gotten only bigger.”'

Yep, another amazing display of just how seriously a UK media figure is aware of Ireland and its history, certainly throughout the 20 century. Almost as if the Irish are not expected to talk about the Anglo-Irish War, especially in light of how it turned out for the UK. That scene was probably cut from Fawlty Towers, actually.

(Can you imagine anyone from the BBC asking someone from Sinn Fein that question? Talk about interesting TV.)

My understanding is that during the conflict period the UK patrolled and enforced the border much more forcefully than Ireland.

Unless a deal is reached I would expect the future to be one where the EU compels Ireland to enforce the hard border in order to maintain the integrity of the single market, etc, etc. Which I imagine would be a very very different dynamic to the past and not a role that Ireland would particularly look forward to playing.

The UK did patrol the border a lot more during the conflict for security reasons. But assuming no reactivation of the conflict the UK wouldn’t need to do so in future. If the EU tries to get the Irish to ploice the border more for economic reasons then it would presumably be done by Irish police who are predominantly catholic I think.

That's what I would also expect. Which means you'd have Catholic Ireland patrolling and enforcing a hard border more stringently than what the UK would feel a need/want to do. Question is if that would play out with the EU or with the UK government as the bad guys - in which direction would the population of Northern Ireland direct their displeasure when it is traffic from Northern Ireland *to* Ireland that's being held up and subject to inspections, etc, rather than the other way round.

Maybe I am too sanguine but it doesn't seem to me to be a likely cause of civil unrest, and of course it is all hypothetical since the EU has no plans to do border checks anyway.

It's actually kind of amusing to hear Remain supporters, who argue vociferously that Brexit is driven by racism, arguing against Brexit by conjuring the fear of murderous Irish mobs.

You've conjured a rare two-Straw-Man argument. Given that your posits exist purely in your mind, I'll leave you alone to continue with it.

Why should Britain impose a customs border? Let the EU do it if they want it so bad

I would like to have a bet that a hard Brexit will only have minor ramifications. I have two hypotheses as to why this will be the case.
1). The bureaucracies of both Britain and EU countries, especially at the front line of providing services, (not necessarily the mandarins in the capitals), will have worked through ways of making things easier for themselves and the people and industries that rely upon their work.
2). Outside the senior political classes, of elected and bureaucratic levels at the EU centre of power, national and local political power structures will be trying to find methods to reduce the costs to themselves and their customers in Britain.

I refer you to this article on preparations undertaken and note what the French are doing to ensure efficiency of transport at Calais and the Portuguese finding ways of making it easy for British tourists to go to them.

Link attached.

Tyler, since you very seldom say anything without having literature to back it up, it would be interesting to understandwhy do you refer to Y2K as an overstated worry? It doesn't fully match my own experience.

The company I worked for at the time spent about two years getting ready for Y2K and dedicated a reasonable amount of resources to do so. This included reviewing every single IT system and modifying or replacing any system that would have problems. Not all, but a number of them would have caused issues. Most companies at the time took this approach.

What made this easy to deal with is that it was a very narrowly defined problem that it was easy to scope and address, especially given the large amount of time available to prepare for it. Were the resources allocated in excess to what was justified by the issues identified? Hard to say, there's probably literature out there on it, and the literature probably does a good job of separating out the core Y2K audit needs from the additional requirements placed on the audit on the basis of "well, if we are reviewing systems anyway, here's an additional list of questions we would like to add." In our case we combined it with a general IT security audit.

Contrast this with Brexit where we, three weeks out in a worst case scenario, don't know what the rules will be. My personal situation is that I have a company in mainland Europe that sells products made in the UK. How much extra working capital will we need to allocate for increased lead times? How much of that will we be able to transfer to our suppliers in the form of improved payment terms? Pricing is in USD so we don't benefit from the fall in the GBP - how much can we get the suppliers to reduce prices to compensate for this? How much time should I be spending dealing with this instead of trying to grow my business? It's a very very different problem set to Y2K, with a lot more uncertainty, and a lot less time to prepare.

Johan - it seems your complaints are largely about the EU, since the UK can't require or compel the EU to publish it's policy on trade in the case of a hard Brexit. The UK has already announced it's trade policy, one of low or zero tariffs on most products from the EU and the rest of the world. I hope that the EU are sensible and follow suit.

One question that is puzzling me on your business - you say you manufacture in the UK but sell in dollars so the devaluation of the pound has no impact. Does that mean you are paying your workers in the UK in dollars then? If so you have given them a very nice pay rise in local currency terms due to the fall in the pound against the dollar, so in the event that the EU imposes tariffs on your product perhaps you can ask them to give up some of this pay rise?

Johan - Agree about Y2K. There was a tremendous software remediation effort for years in advance of Y2K. That effort was successful. To refer to that effort now as somehow unnecessary or overblown is just factually incorrect. Without that successful advance remediation there would have been many disastrous consequences of Y2K.

One of the unheralded benefits of Y2K remediation was that, for many large companies, it was the first time that they performed a stocktake on the thousands of applications they had to run their businesses.

“When you can measure what you are speaking about, and express it in numbers, you know something about it, when you cannot express it in numbers, your knowledge is of a meager and unsatisfactory kind; it may be the beginning of knowledge, but you have scarely, in your thoughts advanced to the stage of science". Lord Kelvin

Any news only matters maximum a couple GDP points or a 2% unemployment rise, if one wants to frame it that way.

Almost all people would live fine with 5% losses but this is the wrong way to frame it. Marginal losses of Brexit would be very unevenly distributed. Most people might live fine after Brexit, but 40000 people might lose EU influenced jobs because of it and be much more vulnerable. And lack of efficient drug import might mean e. g. the death of hundreds of people whose medical attention was suddenly a little too late.

Anyway, most losses have already been produced. The loss of reputation and of new laws to improve the country during this couple years will have consequences for decades. They have fucked up quite a lot of the soft power developed during hundreds of years.

"Most losses have already been produced" - if so the impact was very small. The UK economy keeps posting better and better employment numbers, it is at record highs in terms of share of the population with job.

I meant that the causes of most future losses have already been developed.

UK is only a middle sized country whose main advantages were their soft power built during centuries, their use of English as native tongue and being a point of entry to EU market.

Brexit is tarnishing the first advantage.
The second advantage is less important as more people gets good English as second language. Brexit also decreases the third advantage.

As China is taking advantage again of its privileged resources to claim again for World predominance, UK will be losing its predominance gained mostly during Industrial Revolution and colonization.

Daniel - you have some interesting views on how international trade works. So countries were only buying goods and services from the UK because of its soft power? Why were all those countries so scared of the UK? Did they threaten nuclear war if someone didn't buy their financial services?

You may be missing the connections he assumes are clear.

So, let us use a concrete example. Japanese car makers found a number of advantages in the UK in the 80s, including English as a language and EU market access. (That they both build cars with steering on the same side is true, but probably not a major factor).

English as a language is still a valid advantage, but the UK is leaving the common market. Further, the EU and Japan now have a trade treaty involving tariff free imports/exports between themselves in the future.

Meaning that Honda is closing its only UK manufacturing facility, and Nissan is also ceasing production (a small amount concerning Infini), and now planning to use Japan as a base for future development and manufacturing, not the UK.

This is not theoretical, but an example. The first part concerning soft power is a bit harder to define, but the Japanese (in terms of apperently feeling they were partners with a country that was a stable member of the EU) seem quite insulted at British behavior over the past three years. Whether that played any role in either company's decision making is an open question, of course.

What is likely to happen with Airbus and its future production plans in the UK is not the same, however.

There are lots of ways Brexit will play out, but to deny the damage among those ways is being very, very optimistic.

And to add a bit more about 'soft power' - the Japanese like thought they were dealing with gentlemen who would act in a certain fashion, not the people on display currently seemingly unable to actually handle the UK and its international relations.

Leading in to this - 'Japanese officials have reportedly accused Jeremy Hunt and Liam Fox of taking a “high-handed” approach towards a post-Brexit free trade deal, and briefly considered cancelling bilateral talks due to take place this week.

The Financial Times cited unnamed officials in Tokyo who reacted with dismay to a letter sent on 8 February in which Hunt, the foreign secretary, and Fox, the international trade secretary, insisted that “time is of the essence” in securing a trade deal with Japan, the world’s third-biggest economy.

Hunt and Fox also called for flexibility on both sides – an approach the paper said had been interpreted as criticism that Japan did not share their desire to quickly conclude a free trade agreement after Britain is scheduled to leave the European Union on 29 March.

The letter, which British officials said had employed standard diplomatic language, had briefly prompted Japanese officials to consider cancelling trade talks in Tokyo this week, the paper reported.'

The most immediate and profound impact of a hard Brexit would be felt on the island of Ireland and viability of Good Friday Accord.....amazing how Republic and NI are secondary concerns ....sure hope folks in Belgravia aren’t too inconvenienced by higher prices of gluten free pasta

Can you elaborate? Are you perhaps referring to May's deal (not hard Brexit) where there is opposition by the DUP? In a hard Brexit the UK could continue to offer Irish citizens full right of access to the UK as they have done so since Irish independence. And as the UK are proposing low tariffs on imports there would be no need for any customs on the UK side. Of course the EU might want to stop cheap imports from the UK, but that would be an Irish-EU issue and it is hard to see why the Northern Irish of either side would be significantly upset by it.

On the trade disruption front, the UK is planning to unilaterally slash its tariffs in the event of “No Deal”:

Which should help.

I suspect that given the costs to both sides if it did come down to it the EU and UK would agree some kind of at least bare bones free trade agreement fairly quickly, but I could be wrong. The big question for me throughout the process has been: what is the EU’s “punishment budget”? How much is it willing to pay (in its citizens welfare) to ensure Brexit is bad enough pour encourager les autres?

If Clock is any indication, the budget is infinite. Mercantilist Trumpian mindset through and through.

Hopefully in 50 years immigration fundamentally changes the EU.

'the budget is infinite'

Or as clockwork_prior actually says, the EU has no punishment budget at all, and the EU is not punishing British citizens and companies after Brexit if they are then treated the same as American citizens and companies are today.

This is one of the most bizarre delusions circulating among many Brexiters, that the UK being treated like the U.S. is the same as 'punishing' the UK, a country that voted to be treated by the EU the same way the U.S. is.

It's tricky to answer questions like this because of the structure of the EU; the EU isn't really a government that's directly accountable to a public. It's an intergovernmental body that's loosely accountable to the heads of European states. (Of course there's some direct representative democracy in the Parliament, but that's only a rubber stamp for the Commission really, with some power to elect the Commission's president).

To actually be forced to put a limit on "punishment budget", there would have to be consequences such that the heads of state would consider opting out of its structures.

But that doesn't seem to happen - the only states that matter are the creditors (the Northwest Europeans, including Germany) and France (by virtue of size), and they all seem to be willing to go to their public and say "Hey, we don't like it, sucks, but if we don't stay support the EU as an institution, whatever the cost, either World War, foreign domination by China, Russia and the United States, or recession and Galapagosation at best!".

And the public of all these countries seem pretty much infinitely happy to eat that all the way down. (Contrary to the expectation of some of the over optimistic Leavers in the UK).

In response to your comment on EU policy "pour encourager les autres".

I am an outsider, an Australian, but looking at the Brexit debate in economic game theory terms.

I see the Brexit debate as a preliminary bout to the main fights in the EU. Britain is one of the few standouts from the euro zone. Only Denmark is in the same category as Britain, as never to be a member of the euro zone. The biggest, most important fights will be the countries that want to leave the euro. Giving an example of hardship imposed on Britain just wanting to leave the periphery of the EU provides a tougher reputation for countries wanting to leave the euro.

We have had one bout with Grexit (Greece) and they lost. I still regard them as the next contender as they are still having horrific economic problems – no doubt many self-inflicted but also not having their own currency does not help. In the second tier of potential contenders I would put Italex (Italy) and Irex (Ireland). Both have been bashed around before, but not to the same extent as Grexit and both have fundamental economic problems that could be minimised with a floating exchange rate. The EU has defeated them both before but major economic shocks can arise very quickly leading them to be desperate to escape the single currency.

None of these countries are heavyweight contenders but I see a real challenger developing in Frexit (France). The current turmoil from the gilet jaunes could easily lead to the creation of an unstoppable champion who could crush the whole notion of a single currency of fixed exchange rates between different countries with different economic circumstances and governments.

The biggest likely downsides, in chronological order:

1. The anti-Europe voting bloc both loses its drive and its willingness to reward the Tories for giving them what they wanted, once a Hard Brexit turns out not to be a utopia. Result, Prime Minister Jeremy Corbyn.

2. Scotland leaves. The pro-Union and pro-Independence sides are about evenly matched; a Hard Brexit will probably provide enough impetus to have another referendum in the next few years, this time for the Independence side to win.

3. And, in the medium term, NI leaves. Most of the Protestant Unionists are of Scottish heritage anyway. Once Scotland is gone, I don't see them fighting very hard to stay yoked together to an England that doesn't really care much for them.

'Result, Prime Minister Jeremy Corbyn.'

Talk about a disaster for the UK. Project Fear did not even mention that nightmare, did it?

The expectation of utopia by a "anti-Europe voting bloc" is much oversold.

The Tory base who voted Leave were mostly economically established, affluent, middle aged to old folk who are not exactly agitating for better quality of life.

The Leave vote was also supplemented by some degree of "the Excluded", people of socially conservative views who are not really very economically striving and mostly wanted their voice about society's direction to be heard.

Actually implementing Brexit will simply be enough for most of their Leave voting base. Leave voters mostly just want their voice to be heard and their majority decision to be implemented and don't have some view of "sunlit uplands".

The big threat is really losing their smaller segment of Remain Tories to Labour, since these are the younger adult bracket who are economically striving and are at risk from economic damage.

But even these guys don't actually matter that much electorally, as they're mostly in safe urban Labour seats. The Tories can gain vote share for them, and though it's "nice" in terms of mandate, it won't actually give them any more seats.

I'm also agnostic on JC as PM. It seems that his silly, well meaning, ill considered statements haven't actually done anything to politically damage him (and much less so the more concerning statements of John McDonnell, his svengali), so maybe the British public needs a dose of socialist medicine, JC style, to actually wake them the fuck up.

Scotland leaving may happen, but I'd rate it a lower prospect as there's no way it would make sense in terms of currency (they still want to use the pound and the Euro would do nothing for them), natural resources (how's that oil and gas working out right now) or trade barriers (you want a trade barrier with England, where most of your business and trade in services is).

Even should they be allowed to join the EU, which as a seceding state would be a difficult thing for anti-separatist EU members to take.

German recession risk up in the short term, courtesy of Britain's two most pro-Remain newspapers:

(Background info for others; Standard is a Russian owned tabloid run by the pre-Brexit chancellor and used largely as a political instrument. Guardian is the voice of middle class Centre-Left opinion).

The Guardian article is from Jan. 8, 2019 - one assumes that just a little has happened in the past 10 weeks. Including that it appears that Germany is less concerned about a no deal exit than some UK pundits believe. Including that Germany is not in a recession as of today, though growth is slowing.

Standard article is from yesterday, and not a singleton in the press as a whole.

'An “entrenched” downturn in Germany’s powerhouse manufacturing sector has pushed the pace of expansion in Europe’s biggest economy to the lowest since 2012, according to financial data firm IHS Markit’s snapshot.'

Germany was not in a recession in 2012, however. Even if you could read headlines that sound remarkably like the ones you linked to - 'Germany Could Face Recession in 2012' from the Spiegel, for example.

Not saying a German recession won't happen - after all, one has to come after years of not having one, even after predictions of that happening in 2012 or 2014.

And this from Standard does not seem as if it would only apply to Germany or the eurozone - He said: “To fire on both cylinders again, the eurozone seems to require the global growth outlook to improve. Unfortunately, uncertainty is continuing into April.”

Brexiters are just going to have to get used to the idea that whether Parliament rules out a no-deal exit or not, the EU makes up its own mind. And apparently, it has decided that no deal Brexit is acceptable, regardless of the results.

We will see, of course.

'Brexiters are just going to have to get used to the idea that whether Parliament rules out a no-deal exit or not'

I'm not sure why you refer to 'Brexiters' as such here, as it seems like a lesson they understand better than Remainers.

But one thing I do agree with you here prior, for sure, is that the British Parliament, which is pro-Remain, has taken approach has been based a fundamentally inept understanding that they have a capability to take no role in negotiations and then sit by and simply accept or reject whatever deal is worked out.

Complete failure to understand that to either either take full control and responsibility for negotiations, or else delegate it elsewhere, is the choice that had, not this halfway house of sitting negotiations out and then simply rejecting what is produced.

Happily this is at least a consequence of the naivity of the current crop of the British Parliament (and the party politics of the current Labour Party members in particular), and not something endemic to the parliamentary system.

'I'm not sure why you refer to 'Brexiters' as such here, as it seems like a lesson they understand better than Remainers.'

Because the Remainers want to remain in the EU, so they are opposed to leaving, regardless of the details? If you want to make a distinction between hard and soft Brexiters, that would be reasonable, of course.

'(and the party politics of the current Labour Party members in particular)'

Definitely agree with you there - this mess is the result of a lot of people following their own narrow political/power gaining interests.

'The Remainers want to remain in the EU, so they are opposed to leaving, regardless of the details?'

I'm presuming we're talking about Remain in Parliament here, which is the vast majority of representatives who voted to enact Article 50? It's still incumbent on them to understand their negotiating position and what will happen, even if they "wanted to remain", and it seems that they understand this less well than the MPs who wanted to leave.

Something a lot of people forget are the impacts on natural gas and electricity markets. The UK grid gas and power grids are connected to the continent and rely on this connection to stay balanced (exporting at times and import at other times as storage is limited or impossible).

The other challenge is Irish energy. The ISLAND of Ireland is one single gas and power grid with some limited connections to the UK. It's simply not possible to have an energy border between NI and RoI.

How do import tariffs work?
Half of those complications arise because of import duties imposed by Britain. The whole point was that Britain is free to set its own import tariffs.

The UK has announced zero tariffs on most imports, with some exceptions for food.

Please stop making ill-informed comments such as that the UK will “slash tariffs” in a no-deal scenario. At present there are no tariffs on goods within the EU. In a no-deal, there will be WTO tariffs. The UK are cutting a number of those, but not all. The published material (13th March 2019) proves that there will be a number of tariffs. Beef would be very important to Ireland, so this links to that specific tariff.

Also, the EU would not choose to stop selling goods to the UK, so all this rhetoric about buying from the US is rubbish. It is that food prices will rise considerably for UK consumers as the UK government chooses to apply tariffs.

'In a no-deal, there will be WTO tariffs.'

No, the UK decides what tariffs to set. The maximum is determined by the WTO framework, not the minimum. That is only for UK imports - the UK does not set other countries' tariffs.

'but not all'

Absolutely correct, in an attempt to protect UK meat and diary producers, for example.

'It is that food prices will rise considerably for UK consumers as the UK government chooses to apply tariffs.'

Depends - vegans are unlikely to see much change, apart from likely short term disruptions involving fresh produce. Thepeople who eat a lot of meat or diary - prices will likely rise in their case.

It is true the U.K. can set its own tariffs. However there will be some challenges from other WTO members because some rules will get broken. However hearings will take time. Long enough fir the U.K. to get new customs checks in place an working smoothly one hopes.

I do not think there will be too much short term chaos as rules that should be observed will be suspended temporarily. Air travel may suffer as I have not heard about any suspension of the rules about non EU carriers (UK Carriers) flying within the EU. If thebEU allows that other non EU carriers can file a case and or suspend EU airlines in their own countries.

'However there will be some challenges from other WTO members because some rules will get broken. '

Sure, but you cannot take back control without breaking at least a few things.

A cynical person would suggest that the UK tariff slashing is mainly a ploy to prevent political backlash against those in charge of Brexit.

"A cynical person would suggest that the UK tariff slashing is mainly a ploy"

Or, you know, a necessity

'a necessity'

Well, the 'tariff slashing' involves tariffs that do not currently exist with trade involving the EU - that is, the UK government is attempting to prevent any price increases based on tariffs involving EU countries, with some exceptions like meat and cars. Which is fully the right of the UK government after Brexit, of course.

There is an extremely long list of specific technical and regulatory issues that pose a major threat to some part of industry. Moving goods across borders is only a very small part of the picture.

The key unreported issue IMO is CE marking. In the event of a no-deal, the UK Accreditation Service drops out of the European Accreditation Mutual Recognition Agreement, which means that British companies will no longer be entitled to apply the CE mark to products. This means that most British manufacturers will be unable to export to the EU unless they export via a foreign subsidiary or partner that is competent to assess the products for compliance with EU regulations. This would be reasonably straightforward for most consumer goods, but would be extremely challenging for more specialised products like medical devices and safety-critical equipment that are subject to complex regulations and carry a high degree of risk.

This isn't an intractable issue, but it could take many months or years to fully resolve, during which many British companies would lose a substantial proportion of their export sales. The short-term impact could be severe, particularly for smaller companies or businesses that are already struggling; fully recovering from this sudden loss of access to our largest export market could take decades, because it gives a huge advantage to EU rivals.

The financial services industry would face particular challenges due to the loss of passporting status; for many financial institutions, the no-deal contingency plan is to simply leave Britain for good. Many EEA firms have already transferred substantial assets out of Britain to guarantee continuity.

There are hundreds, possibly thousands of no-deal hypotheticals that the British government cannot adequately answer. What happens to the supply of radioisotopes and radiological equipment in the event of a no-deal, given that Britain will drop out of Euratom? What happens to British drug manufacturers and suppliers of precursor chemicals, given that Britain will no longer be recognised by the European Medicines Agency? What happens to the fishing industry if we drop out of the Common Fisheries Policy? What happens to British seafarers if their certificates of competence no longer enjoy mutual recognition under directive 2005/45/EC? What happens to British organic farmers if their organic certifications are no longer recognised by the EU? What happens to Eurostar and Le Shuttle if the UK Office of Rail Regulation loses recognition from the EU Agency for Railways?

I'm not particularly worried about queues at Dover or shortages of essential goods, but I am seriously concerned about a loss of competitiveness leading to layoffs, bankruptcies and a needless recession. One of the key problems in negotiating a withdrawal agreement has been the sheer complexity of Britain's relationship with the EU; in the event of a no-deal scenario, that complexity would create innumerable barriers to British business.

Very good and factually supported statements.

I don't know of many countries that seek to get out of a customs union, have no voice in a major trading network, and expect to see rainbows in the morning.

Indeed there could be problems if the EU made its member countries and other institutions behave extra horribly to the UK. But that to me seems like a good argument for taking a bit of pain now and getting out. It's like being married to an abusive husband, of course there are costs to leaving but you shouldn't stay.

But I don't believe that the European nations are that horrible. I think they will work to cooperate with the UK to quickly solve any snags and issues. But what can I say, I tend to believe in the best of people.

The obvious risk is UK politics is fundamentally broken right now. The UK cannot be trusted to stick to any deal agreed with the EU.

To continue your analogy, right now it feels like the UK is the abusive husband, not the EU.

'The UK cannot be trusted to stick to any deal agreed with the EU.'

Which is why the EU seems to be favoring a no-deal Brexit, regardless of the pain. That way, they won't have to actually care about anarchy in the UK having any impact on internal EU matters.

It's not a question of being "horrible", it's a question of the rules-based system that allows the EU to function. The UK is fully entitled to abandon decades of treaties and conventions, but the EU is under no obligation to make special accommodations to soften the impact of that decision. The EU will bend their rules to assist one of their major trading partners, but it won't break those rules and I wouldn't expect them to.

The EU is not an unreasonable institution, but it will always put the interests of member states first. It has offered Britain considerable assistance in developing a path out of the EU and will continue to cooperate after Britain leaves, but that future relationship will be based on the simple fact that Britain is no longer in the club, is no longer paying membership fees and can no longer expect the rights and privileges of membership.

It is worth noting that the EU (and many member states) have far more developed no-deal contingency plans than Britain. The decision of the British government to continue to use the threat of no-deal as a negotiating tactic while failing to properly plan for that eventuality is a problem entirely of their own making.

If it is a rules based institution, should be no problem for the UK to be treated just like all the other countries exporting to Europe, who manage just fine. I think the concern is that the EU seeks to punish the UK extra specially for Brexit, not that they get treated normally. As I say, I am sure that the EU members are not horrible people so they won't do this.

On the EU contingency plans - have they organised things so that there will be no customs delays and UK planes can land fine? This is the one thing that people discuss as potentially a big problem.

'who manage just fine'

Sure - though their trade does not go through Dover-Calais, which currently lacks pretty much all the infrastructure required . Further, the trade from those countries is not really an integral part of a finely meshed EU logistics system - like the one that applies to the UK auto industry.

'I think the concern is that the EU seeks to punish the UK extra specially for Brexit'

And apparently, regardless of how often it is pointed out that the EU will simply treat the UK as a non-member of the EU, that 'concern' never goes away. The EU is not punishing the U.S. currently, and when the UK is treated like the U.S., that is not punishment either.

That is, a British citizen in Germany after Brexit is not punished by having to follow the same rules I do, being a non-EU citizen.

But then, the Brexiters are extremely eager to blame everyone except themselves for whatever happens regarding Brexit, so instead of a back stab (that is being reserved for the Remainers), the EU is punishing the UK by simply applying EU rules - rules that the UK participated in making, ironically enough.

This attitude is simply preposterous. The UK has had 2 years to negotiate the terms of an exit. They have a reasonable deal on the table that takes care of all these technical issues but they can't get it through parliament. This isn't the EU's fault. If they needed a minimum exit agreement to handle these technical details in case the bigger deal fell through, they should have been working on that. They still have the option to remain for now and start the process all over again if they want.

None of this is the EU's fault. It's all on the UK. The most you can say about the EU is that they have a strong irrational commitment to free trade = free movement. But that's not about punishing the UK. That's a strongly held principle long predating Brexit.

'but the EU is under no obligation to make special accommodations to soften the impact of that decision'

When a Brexiter reads such words, all they see is PUNISHMENT.

'it will always put the interests of member states first'

And you would think that if anyone understood that logic in general, it would be a Brexiter, but apparently, that statement too gets reads as 'punishment.'

'The decision of the British government to continue to use the threat of no-deal as a negotiating tactic while failing to properly plan for that eventuality is a problem entirely of their own making.'

Well, at least you don't hear that the EU will miss the UK's money too much to allow a no-deal exit any more, so it does seem that Brexiters actually do learn, eventually.

Can’t help but inject alarmism about global warming into everything. How pathetic.

And Tyler, saying Y2K was exaggerated because there were little negative outcomes is wrong. Without substantial preparation, there would have been far more disruption from Y2K. You’re drawing the exact wrong lesson.

And people haven't been preparing for Brexit?

If you know exactly when and how Brexit will happen, congratulations. You are the only person on the face of the planet with that knowledge.

In other words, no one actually knows what to prepare for - and as of today, that still includes the actual date of Brexit.

Just like Y2K, we’ll find out how effective the preparation was when Brexit finally occurs. Let’s hope the Brexit prep work is as effective as the Y2K prep work was. Maybe the UK and EU will be well prepared and Brexit will cause little disruption. Based on watching the Parliament in action over the last few months, I have serious doubts.

'I have serious doubts.'

So does just about everybody in the EU by this point.

The .eu domain may be a laughable issue until you consider the betting sites. The UK is the home of many business focused on sports bets that offer services in the whole EU.

Why is everybody talking about what Britain can buy rather than what it can sell?

In terms of strength of bargaining position, I would think that the EU could say "Yeah, buy all you want, but everything you send to us automatically becomes a non-EU import subject to all thosse tariffs and inspections."

Tyler asks us not to think about long-term impact, but I would think the short-term would be the same. Any product or service better offered from within the EU is going to move or decline.

Brexit is like a boyfriend who breaks up with a girl, and then calls up and asks her to do his laundry.

More like a divorce where the wife wants to exact as much damage as possible to the husband who's leaving her.

Do you have any example of the EU treating Brittain as anything other than non-EU?

Because to a (US) casual user this seems like (US populists) complaining about lost UK-in-EU benefits, not special penalties.

Maybe Britain can drunkenly call the EU late on Friday night and ask for a little banking.

A. I don't know what will happen
B. But as an investor in and member of the Board of Directors of a small UK automotive supplier, I can tell you what is already happening, from the perspective of our one company (though it does sell to almost all the UK car plants).
C. Inventory buildup. All along the supply chain companies are amassing large "safety stocks" because we just don't know what will happen. With a typical Land Rover generating some $15,000 in operating income per unit, and being produced at the rate of one every few minutes, a company like JLR (and its supply chain) want to ensure no disruption to production, and thus we are all stockpiling. This causes near-term cashflow problems, but may have minimal long-term impact.
D. General tightening of credit terms (not the same thing as interest rates, please note!). Firms like ours and other suppliers we talk to are all having trouble getting "cover" on (e.g.) international shipments of parts and materials. The various intermediaries who lubricate international trade (think trade insurers, factors, LOC issuers, etc.) are acting like kids playing musical chairs: each is afraid they will be the one holding the millions of GBP in WIP inventory if some random Belgian customs inspector decides to "work to book."
E. Those are some things that ARE happening now. Again, I don't know what WILL happen. Generally we are suffering most from uncertainty about the future (the eternal enemy of commerce), not from negative actions being taken now. But uncertainty (like inflation expectations) feeds back into reality.
F. In our small neck of the woods, I don't know anyone who is worried about tariffs per se, in terms of their levels or imposition (as many of the commentators are arguing about). There seems to be some (misplaced?) confidence that the numbers will work out: if some tariff or fee changes, it will just ripple through the value chain. The price of an Evoque may go up or down by some %, a worry for JLR but not an immediate one. What we are MUCH more concerned about is all the frictional losses, all the barnicles on the hull of the ship of commerce (if I may wax poetic for a bit). This is the stuff mostly overlooked in all the ranting by the punditry. A shipment of X parts is held up not because of a higher tariff or a rule violation, but because it needs to be inspected now (whereas before it was waved across the border), and the port's inspectors are short-handed. Another one is missing a piece of paperwork which we never had to file, but now we do, and in fact the customs people don't even have enough of the forms in stock. All these little things add up and really screw us up. I can't think of a good analogy... maybe it would be like going from ordering online on Amazon to mailing in checks to the Sears catalog: have we GOT checks? Stamps? How many days does it take for the mail to get there? Where's the order form?
G. In short, there was a "manual" of entering the EU (use this IBAN code, reference this customs category list, etc.): there is not any "manual" for leaving it, and that is our problem.

Again, just from one small company, view on the ground.

'but because it needs to be inspected now (whereas before it was waved across the border)'


'and the port's inspectors are short-handed'


'Another one is missing a piece of paperwork which we never had to file, but now we do'


'and in fact the customs people don't even have enough of the forms in stock'


And that is what taking back control looks like - going back to the world of 1970 in terms of a finely tuned EU wide logistics machine.

It is also one reason why BMW is seriously considering Mini production out of the UK, according to German reporting (rumors at this stage, of course). And one should note, BMW opposed extending Brexit in installments - almost as if they already have made plans they intend to follow, regardless.

"Tariffs would increase prices of imports into the U.K. One-third of its food comes from the EU. Higher import prices would create inflation and lower the standard of living for U.K. residents."

Sigh, they've been claiming this for a couple of years now.

WTO rules state that you can have any import tariffs you like on two conditions. They are below the agreed maximums and that they are the same for all suppliers.

So, Britain imports, great. So, we can charge anything less than WTO as long as we charge the same to all other WTO members. And if tariffs would raise inflation and lower living standards? Then we'll lower tariffs, won't we?

Not to do so would be to be idiots. And what has the government said? If we leave on WTO terms then we'll lower tariffs to imports from all around the world, as stated above. That is, we're not idiots.


I guess you don't export to the EU.


That neither the article nor the blog post mention Northern Ireland -- a bizarre omission given the importance it has assumed in the negotiations -- is perplexing and suggests that both drastically underprice the cost of a hard Brexit.

Y2K was hardly overblown. They spent years and billions of dollars to prevent malfunctions, from the miniscule to the catastrophic. The only chance Brexit ends up like Y2K is if people have been working hard and investing in processes to make the transition smooth.

Y2K was overstated because years of work went into successfully avoiding the issue. I did that work and remember well in the early hours of 1/1/2000 fixing the little issues that we missed. It was not overstated before that work was done.

A hard Brexit may be overstated but I doesn't seem that everyone is working hard to avoid issues.

The difference between the impact of a hard Brexit and Y2K is that any problems with hard Brexit are ones that can be fixed over time. I.e. it won't all happen at midnight. So maybe the best strategy for Brexit is to wait and see what problems arise and then fix them. Many people worry that the EU countries will be obstructive to finding fixes - which makes we wonder why the UK would want to be in a close alliance with people who hate them.

This is where the comparison to Y2K *does* make sense.
At some point in the future, the clock will tick forward by a second, and the relationship between the EU and the UK will change from one state to another. A change that will have consequences.

With Y2K the view was that because the consequences were unknown but had the potential to be very damaging it made sense to spend years analysing and preparing for them so that anything that had to be working when the clocked ticked over would work.

With Brexit, the suggestion is that we figure it out over time once the clock has ticked over?

How bad can that


Without an anesthetic

Really be?

"...ending lucrative routes for U.K.-owned carriers such as easyJet unless they have taken their own Brexit preparedness measures."

So this whole article is just assuming all businesses in the uk have been sitting on their hands for the last few years hoping brexit won't happen? Uk politicians may have that luxury, but businesses are rarely able to match the incompetence of government.

"Tariffs would be reimposed. They are as high as 74 percent for tobacco, 22 percent for orange juice, and 10 percent for automobiles. That would hurt exporters. Some of that pain would be offset by a weaker pound."

The only reason tariffs would be re-imposed is if the UK is dumb enough to do that to themselves.

"The only reason tariffs would be re-imposed is if the UK is dumb enough to do that to themselves."

Would you say it's

1. More,
2. Equally As or
3. Less

dumb than awarding a ferry contract to a company that didn't have any ferries and no track record of running ferries while ignoring the company that previously operating a ferry service across the Channel and subsequently settling a lawsuit with the latter company for £33M?

The incentives in risk assessment in government run one way. No-one gets into trouble for warning of a risk and spending money on contingency, even if the spending was ridiculous. But you do get into trouble for discounting a risk as extremely unlikely and it happens. So civil servants are more prone to highlighting risks so that if it happens, they're covered.

And large bureaucracies are also a mess of incentives. It might be that the risk of deliveries is extremely small, but who wants to deal with that situation if it happens? Why not talk the risk up a little, so you have a spare warehouse of parts just in case?

A: The author of "Stubborn Attachments" downplaying the risks (and therefore compound risks) to the UK's economic growth from a hard Brexit.

Q: What is "mood affiliation?" And I'll take potent potables for $600.

Short term, I'm guessing a diminished supply of recreational drugs will be the biggest inconvenience for UK residents.
Of your block quotes, only 1st,3rd&4th seem credible to me.

Y2K was a real risk.

It was *mitigated* not refuted.

Leavers in UK deny that there is a problem, hence less preparation.

Uncertainty hampers preparations too. It's very possible that some deal will happen. So less preparations. For private sector, the value goes down once it's not clear.

Thread winner!

Does Britian produce any orange juice or tobacco?

Lots of debate about how negative Brexit might be. Can someone remind me of the positives again? Because otherwise it's a debate of saying how much pain I would like to inflict on myself.

A bit late to this exchange, but I see China as the big beneficiary -

Latest update from a key research institute in Ireland - Brexit impact similar to the bailout. As you can understand, Irish people aren’t happy that we STILL don’t know what form of Brexit will happen.
“A new study from the ESRI and the Department of Finance finds that GDP in Ireland ten years after Brexit will be around 2.6% lower in a Deal scenario, 4.8% lower in a No-Deal scenario and 5.0% lower in a Disorderly No-Deal scenario respectively, compared to a situation where the UK stays in the EU.”

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