Will 2019 be the year of the liberal backlash?

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As I finally overcome the effects of flu and Christmas celebrations, it is a moment to reflect on 2018 and what 2019 might bring. In common with most liberals (I hesitate to say all...), I am not feeling cheerful. But surely there is hope?

The anti-liberal wave continued through 2018. I will come back to Donald Trump and Brexit in a moment, but the trend has been visibly much more widely. In Europe we had the rise of anti-establishment parties in Italy and Germany, with the former achieving power (though to be fair the 5-Star movement does have some liberal elements). Anti-liberalism is well entrenched in Poland and Hungary, and the one apparent liberal bright spot, France, has now hit a big bump in the road with the gilet jaune movement. Outside Europe things look no better, with Erdogan in Turkey, Putin in Russia and Assad in Syria all looking unstoppable. And then there was the election in Brazil. At least the kleptocrat Jacob Zuma was finally thrown out in South Africa.

So the soul-searching amongst liberals continues. Critics from left and right attack a liberal establishment that just doesn't get it. To those on the right, what liberals don't get is patriotism and standing up for national interests in a wicked world. From the left, with its love of abstract nouns, liberals don't get that "neoliberal" economics and "austerity" are total failures. And, of course, there is something to both critiques - though right's answer of crony capitalism, and the left's of extending the central state's reach, both leave liberals as sceptical as ever. Liberals are clear about elements of a new narrative - environmental sustainability and internationalism, for example - but can't string it together coherently.

The biggest surprise to me over 2019 has been the success of Donald Trump. I had assumed that his regime would collapse into incompetence. The incompetence is there, evidenced by its inability to deal with anything complicated, like healthcare, but there is method in Mr Trump's madness. He is slowly developing a coherent narrative and a government team that believes in it. This includes the pursuit narrow US interests (and maybe Israel's too...) abroad, an attack on free trade, stimulus to the US economy, and stirring the pot on immigration. He is getting some grudging credit even from critics for his robust handling of China, for example. His claim that he is keeping his promises has currency and, through rose-tinted spectacles, it is possible to accept his claim of a transformative administration. Then you remember the growing healthcare quagmire, the roll back of environmental protection and the malign effect of tariffs on the domestic economy, and a more realistic assessment beckons. 2018 has been a fortunate year for Mr Trump. His trade war has been well-timed, and the tax stimulus too.

Brexit played out closer to my expectations. The government has been forced into a deal that keeps a customs union going for the time being at least. I am taken aback, though, by the strength of resistance from hard Brexiteers. I would have thought a tactical retreat was in order: get past 29 March 2019 and into formal exit with relatively little dislocation, and then start work on dismantling the hated compromises. We have taken back control after all. This is clearly the calculation of those still in the cabinet, like Michael Gove; but many others seem happy to contemplate a no-deal Brexit instead. But Theresa May is rapidly making that option untenable. Bexiteers like to talk of a "managed" no-deal, with a series of side-deals to handle the bigger problems, like air flights and medicines. They assume that the EU would play ball because, after all, they export so much to us. But we are rapidly running out of time, never mind goodwill. Others seem attracted to the idea of a hard landing, in order to bring out a "Blitz spirit" in plucky Britons. I get fed up with Remainers jumping on every scare story that gets dreamt up, but the shear delusionality of the more extreme Brexiteers is unbelievable.

Still, with the current tactics of both Mrs May and Jeremy Corbyn the chances of a no-deal crash are much higher than they should be. There is, alas for my Lib Dem friends, almost no chance of a further referendum. If Mr Corbyn supported the idea it might have been feasible, but he clearly doesn't. He wants a bad Brexit that can be blamed on the Tories to Labour's advantage.

So what hope in this dismal picture? I am waiting for the backlash (against the backlash, if you will). This liberal backlash is based on two things. Firstly that younger people don't hold with the anti-liberal movement. For them global warming is a real threat, and diversity a real asset. This needs qualification: less educated youngsters are picking up on the right-wing attack, and indeed they are behind a lot of the associated violence. But they form a lower proportion than they used to, and are prone to apathy. Meanwhile a large part of the original backlash comes from older people. This gives the potential for the pendulum to swing back. Time may be on the liberals' side.

Secondly, it is clear that the anti-liberal populists don't have long term solutions for the main problems afflicting society. In fact, beyond the headlines, their solutions involve the breaking down of democratic institutions to provide cover for crony capitalism in league with a crony state. Where those institutions are relatively weak in the first place, they may succeed in entrenching themselves well enough to head off any backlash (look at Venezuela for an example of where things can go). But in most developed countries, including the United States and Britain, I think the institutions are too strong.

How might the backlash play out? In the US the most obvious way is for a full Democratic victory across all branches of government in 2020. We had a hint of this in the mid-term elections in 2018, but the backlash has to develop further for this to happen. And yet Mr Trump's end could be hastened if senior Republican politicians and donors start to panic. Trump's confrontational, insurgent game has produced brilliant success but it does not make for secure political alliances. This could happen in 2019.

In Britain? Things are harder to call. Labour are currently trying to combine a liberal backlash with an anti-liberal left backlash. This is creating a lot of stress, and a well-led, well-prepared and well-funded Conservative party (to say nothing of the continuing appeal of the SNP), could well be enough to keep them at bay. And the impact of Brexit on our politics is unknowable. A wider realignment is possible.

That is my hope and maybe 2019 will see the turn of the tide. But one thing is clear about any liberal backlash. It will not be led by reheated liberal politicians from the past. It will depend on appeal to younger voters, and that will need something fresher. And that is something all the mainstream political parties, in Britain anyway, are struggling to do. There will have to be changes at the top. Happy New Year!

Britain’s fate is in the hands of two people: Theresa May and Jeremy Corbyn. Which is the problem.

I'm back from Australia, but alas recovering from a bout of flu combined with tooth trouble. What with Christmas coming, normal service will not resume for a while. But I can't help myself from commenting on  Britain's Brexit drama. 

It is striking that so much of what happens next depends on just two individuals, the Prime Minister, Theresa May, and the Leader of the Opposition, Jeremy Corbyn. This is not a comforting observation.

First, and most obvious, is Mrs May. She is in charge of the Government - and when it comes to taking the initiative, the Government has the upper hand over Parliament, even though the latter is technically sovereign. Parliament has tried to wrest some control over the process, with need for a "meaningful vote", but Mrs May has easily outmanoeuvred it. She alone dictates when the vote will take place, and simply postponed it a month when things weren't going her way. She still needs parliamentary consent though, which leaves a deadlock.

Meanwhile, Mrs May has fended off an ill-advised attempt from within her parliamentary party to unseat her as their leader. There's nothing much they can do now to remove her. She's in complete control.

How does Mrs May choose to use this power? She clearly wants the deal she has negotiated with the EU to be ratified, allowing the UK to formally leave on 29 March, and to get on with the next phase of the negotiations about the trading relationship with minimal disruption to commerce and daily life. She interprets this, fairly enough, as fulfilling both the mandate given by the 2016 referendum to parliament, and the election promises she made in 2017. What if she can't get that consent? She says that there are two alternatives which are No Deal or No Brexit. But she has not expanded on what exactly she means by this, except to rule out a further referendum to decide between two or more of the options.

The closer we get to No Deal the more horrifically it looms, completely giving the lie to Mrs May's earlier mantra that "No deal is better than a bad deal". She consider this to be a realistic option - but it is still what happens if parliament does not consent to an alternative. So what does she mean by "No Brexit"? If she rules out a referendum then that means a unilateral decision by parliament to revoke the Article 50 Notice to leave the EU. This has been shown to be legally feasible, but only if it is a complete revocation, and not shenanigans to simply resubmit the notice a bit later. That idea looks horrific too. Even the most ardent Remainers feel that Article 50 should only be revoked if a further referendum endorses it.

This is highly unsatisfactory, but Mrs May is the person in charge and we must play to her rules, even if she doesn't explain fully what they are. Only one person has the power to break the deadlock: Mr Corbyn. The most obvious way would be for him to throw his weight behind Mrs May's deal, mobilising enough Labour MPs to neutralise Tory rebels and the DUP. It would be very easy to argue that this is in the national interest, and Labour committed to Brexit in the 2017 election. However, he has spent so much energy rubbishing the deal that the effect on his authority would be catastrophic. 

There is another way. As Leader of the Opposition he can table a confidence motion allowing parliament to bring the government down, either leading to a new government or an election. This is what he says he wants to do, to force an election, which he hopes Labour would win. But it is hard to see how he would win an election at this point in the process, without a clear policy on Brexit of his own. Even a deeply split Tory party should be able to see him off. Anyway, if he won he would not have time to renegotiate Mrs May's deal, so it does little to resolve matters.

But there is a bigger problem with using a confidence motion: neither the Tory rebels nor the DUP would support it. They do not want an election on Mr Corbyn's terms, or, heaven forbid, risk a Corbyn-led Labour government.

So what else could Mr Corbyn do? He could put forward a confidence motion with plan to replace the current government with a cross-party one with the single aim of resolving the Brexit deadlock through a referendum. This would require cooperation with Tory rebels (though different ones from the hard Brexiteers that are causing Mrs May her main problem). I think this idea has been referred to as a government of "national unity", though it is hard to see that it would do anything but promote yet more national discord, even if that may be necessary.

That would leave the rather tricky question of who would lead it. It couldn't be a party leader. It would help to bring as many parties on board as possible: the SNP for sure, but the Lib Dems, Greens and Plaid Cymru too. There would also need to be clarity on where it would end and how. It would need to resign pretty much s soon as Brexit formally happened, or Article 50 was revoked. Would the Conservatives and the DUP be given another chance after that? Or would there be an election, with the Conservatives irretrievably split?

This final option is a very long shot, but these are desperate times as the prospect of No Deal looms. But the real problem is that I don't think that Mr Corbyn has the vision or ability to pull it off, even if he wanted t, which is doubtful. And without Mr Corbyn it cannot work.

Which leaves us with Mrs. May's grim brinkmanship. At a time needing great, visionary and persuasive leaders, Britain's don't measure up.

Are there Australian lessons for Brexit?

I have now just a week to go in my long trip to Australia. I’m not all that surprised that I haven’t managed to update this blog regularly on my travels. It turns out that it is quite hard to fit into my holiday routine. But witnessing the mounting political tension on Brexit in the UK from afar, I will manage one more post. Does an Australian perspective have anything important to say on Brexit? Well, yes and no.

Australia is beloved of Brexiteers, partly because it is part of an “Anglosphere” which they hope can substitute for Britain’s European identity. But there are two more substantive reasons. One is that Australia shows that a medium-sized nation can be economically successful as a fully sovereign state. The second is that a country that attaches itself to the booming Asian, and especially Chinese, economy will prosper.

Let’s start with the first proposition. Australia is undeniably successful without being part of a wider formal economic block like the EU. Indeed most Australians would probably be horrified at the loss of sovereignty that such an arrangement involves. They are fiercely self-reliant and independentlyminded. Most of the Australian6s I have had proper conversations with have been internationally aware and sympathetic to Britain’s membership of the EU. That makes them unrepresentative. It is very hard to get any kind of international news on television or radio out here. The bulletins are consumed by stories on the latest bushfires, weather events, local political spats and sport. Only the Royal Family can intrude. I suspect that most Australians are pretty sympathetic to Brexit. The country has half or less of the population of the UK, and still makes a very good go of things. Indeed it is prosperous. One shouldn’t make too much of this, though. Australia’s dependence on the US for security has meant that it had to send its boys to be killed in Vietnam. And Australians worry about Chinese intrusion into their state currently.

Australia’s success has a lot to do with the second proposition – that its economy is tied to the fast-growing Asian economy, rather than the lacklustre European one. Australia exports substantial amounts of minerals and agricultural produce to China, in particular, and attracts lots of Asian tourists and students. There is a lot of Chinese investment. That keeps its exchange rate high, so that Australians can afford lots of exotic imports. A popular theme of the Brexit case was that Britain should unshackle itself from the European corpse, and trade more with Asia. Although the example usually given is Singapore, Australia seems to make the case even more convincingly.

But, of course, we have to think of the differences between Britain and Australia. The first is Australia’s relative isolation. The country has little choice but to go it alone, as it is not geographically close to any other large nation – if you exclude Indonesia, which is not close to any of Australia’s major economic hubs, quite apart from a cultural gulf that makes the divide between Britain and its European neighbours look trivial. Indeed the internal distances within the Australian continent are often more daunting than those between Britain and even its more distant European neighbours. Australians are self-reliant because they have to be.

But they are still a success. That is surely down to the next big difference: it is a vast continent with huge exportable assets. These include massive mineral wealth and agricultural land. The Australian economy has a highly extractive character. That even applies to its agriculture, where few farmers give serious consideration to the long-term sustainability of their methods. While on our trip we experienced dust storms in New South Wales. Dust of that sort doesn’t come from deserts (where such fine particles would have been blown out long, long ago) nor form vegetated land; it is agricultural top soil being left exposed by exploitative farming methods. Even without leaving vast areas of topsoil exposed, agriculture depends heavily on artificial fertilisers, which can only do so much. All this means high agricultural productivity and competitiveness of exports for the time being. Britain does not have the option of exploiting its natural resources in a similar way, even if it wanted to – which it very clearly doesn’t. Nobody suggests that despoiling hundreds of square miles of British countryside is what the country must to to escape economic dependence on Europe.

So what could Britain do instead to ride the Asian wave? Asia has strong demand for capital goods. But Britain has hollowed out its manufacturing industry (unlike Germany which is riding the Asian wave successfully from within the EU). There is hi-tech expertise and products. Britain could do better here, but China is investing hugely so that it becomes less dependent on foreigners. Tourism? Professional services? Universities and schools? There are possibilities in all of these, though Britain tends to shoot itself in the foot, especially with over enthusiastic anti-immigration policies. But it would be a hard road. Anyway it is far from clear that Britain is better off being outside Europe and free of its regulations and trade restrictions, or within it and so having a wider semi-domestic market in which to scale up its products and services. Britain’s proximity to the rest of Europe is one of its comparative advantages over Australia – it seems silly to get in the way of that.

Another point is worth making. Some Brexit supporters suggest that Australia could be part of a wider international support network, economic and political, rather as the Commonwealth was before Britain joined the European Community. From here that looks naïve. Australia has long outgrown its old links to Britain. We used to be a significant source of agricultural outputs – but now Britain cannot compete with the closer and larger China. On other matters, education or business services, Australia looks more like a competitor than a partner. Distance prevents the intimate supply chain links that are a feature of Britain’s economic relationship with its neighbours.

While the Empire 2.0 and linking up to Asia’s dynamism look like fatuous arguments for Brexit, Australia still shows that smaller countries can plough there own furrow if they want to. Outside the EU Britain would still keep its strong links to the continent, and the laws of comparative advantage suggest that the economy would in due course rebalance to a new reality. The only question is how much poorer (or, for the Brexit optimists, richer) that new reality would be. Lacking Australia’s natural assets, it seems likely that it would be quite a bit poorer.