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Brexit doesn't mean Brexit after all

The Brexit phase one deal is as likely to destroy Britain’s minority Tory government as to lead to a successful phase two agreement.

That will be good news for many millions of workers and families struggling with low wages, shrinking benefits, stagnant pensions, student debt, deteriorating public services and the prospect of many more years of austerity and privatisation.

They desperately need a Labour government that will carry out bold policies to tax the rich and big business, invest in public services and infrastructure and redistribute income, wealth and opportunities in favour of the vast majority of the population.

For all the proclamations of unity and success from Tory Cabinet ministers and right-wing newspapers in response to Theresa May’s dramatic Friday morning truce with the EU Commission, her reign is now almost certain to end in division and failure.

The seeds of the Tory government’s destruction have been sown in a phase one fudge which promises “full alignment” with EU single market and customs union rules and regulations as a fall-back position to prevent a “hard border” between Northern Ireland and the Irish Republic and between Northern Ireland and Britain.

In effect, this commits Britain to a final settlement that perpetuates membership of the EU in all but name, whether through membership of the Europe Economic Area or a new bilateral agreement.

Such a perspective is reinforced by other phase one commitments to extend involvement of the European Court of Justice in citizenship and residency matters for at least eight years and to pay an exit fee of £35-39 billion into EU coffers.

This dog’s breakfast might keep Northern Ireland’s DUP MPs on board with May’s ramshackle coalition in Westminster, but it will probably upset enough anti-EU Tory MPs to upend her majority in key parliamentary votes.

The alternative scenario for phase two negotiations is that they end in no final settlement. This will turn powerful sections of big business against the Prime Minister and her Chancellor.

The giant banking, industrial and retail corporations and employers’ federations represented on her EU Business Advisory Council have relied upon May and Philip Hammond to undermine if not reverse Brexit by keeping Britain as close as possible to the four EU “freedoms” for capital, goods, services and labour to be moved around unhindered in order to maximise corporate profit.

European Council President Donald Tusk was right, therefore, to warn that phase two talks on a final EU-UK exit agreement, future relations and any transitional arrangements are going to be even more difficult than the past six months of deadlines, delays, leaks and ultimatums.

He knows he can rely on the EU Commission and its unelected supremo Jean-Claude Juncker to make Britain’s departure from the EU as hard and punitive as possible.

Indeed, EU chief negotiator Michel Barnier has just been told that substantial talks on phase two might have to be delayed until February or March 2018 because the British government is not yet “clear” about its own aims.

Tusk, Juncker and Barnier can also rely upon powerful economic and political forces within Britain to support “full alignment” with EU rules, regulations and institutions way beyond March 2019.

Such a framework would outlaw many of Labour’s progressive policies, which is an important reason why it finds so much support on the political right — not least inside the Parliamentary Labour Party and certain elements of Labour’s shadow cabinet.


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