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Shhh, don’t mention the Brexit war

The British economy is headed for a deeper and longer recession than its peers

The UK's Brexit problem: even Labour leader Keir Starmer seems loath to mention it. Photograph: Andy Bailey/PA
The UK's Brexit problem: even Labour leader Keir Starmer seems loath to mention it. Photograph: Andy Bailey/PA

There are perhaps four ways to apprehend the UK’s increasingly torturous Brexit process. First, that it was an internal Tory party bust-up writ large, one that somehow broke free of its moorings and overwhelmed British politics. It had limited mainstream support previously outside of a fringe element within the Conservative party, though Nigel Farage’s UKIP did broaden the appeal.

Alternatively it can be viewed as a backlash against wage disparity and immigration, the main drivers of post-2008 populism that continues to convulse Western politics, a backlash that coincided with a referendum, an explosive mix. US officials apparently advised their UK counterparts of the perils of holding referendums on governance issues as they tend to be more polarising than referendums on social issues.

Then there is the nativist element, the one that alienates so many here, which incorporates Boris Johnson’s Churchillian fantasies and the rather vague concept of Global Britain. The surge in English nationalism was a mood with no political expression until Brexit gave it one. People like to see Donald Trump’s America First platform and Brexit as regional variations of the same trend, with “take back control” an English translation of “make America great again (Maga)”.

The fourth, and perhaps least regarded thesis, is to see it as an attempt at an economic reset.

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For obvious historical reasons and for the mess Brexit has left in Northern Ireland, we struggle to see past the nationalist agenda and tend to dismiss the economic one.

The UK’s economy has been floundering since the financial crisis primarily because of slow or non-existent productivity growth. Brexiteers believe a nimbler, less taxed, less regulated economy could provide the necessary jump-start.

For obvious historical reasons and for the mess Brexit has left in Northern Ireland, we struggle to see past the nationalist agenda and tend to dismiss the economic one.

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“Brexit is not a British phenomenon” but a European-wide revolt against Brussels, former BBC presenter and political journalist Andrew Marr told an Ibec event here in 2019. While not advocating Brexit, he said there was an “underlying logic” to wanting to leave the EU in order to pursue an alternative economic model – something Brexiteers referred to as Thatcherism 2.0 – which was underappreciated in the liberal media. He dismissed the notion that Brexit was an “irrational spasm” linked to the loss of empire.

Advocates, he said, believe Britain should pursue an alternative economic model along the lines of the so-called Singaporean model, which would involve deep tax cuts and a wholesale jettisoning of regulations to attract inward investment. “You slash corporation tax right down, way below where it is right now, you slash regulations, you tear up your environmental and worker protections and you go for broke, you go for bust,” he said.

His comments proved strikingly accurate in the context of Liz Truss’s crash and burn government, which essentially went for broke on tax.

Like every big event in politics, Brexit is most likely an amalgam of forces. Six years in (it began after the vote in 2016 with sterling’s decline and the migration of financial services from London) and the colossal failure of the project is now self-evident.

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Across a range of metrics the UK is struggling. The UK economy is probably already in recession and has the worst growth outlook of any big economy bar Russia. The decision to choose a hard Brexit has resulted in a 15-20 per cent fall-off in trade with the EU and placed significant barriers on smaller exporters wanting to expand.

Unemployment is expected to double over the next two years, while several sectors are in near terminal decline because of a lack of migrant staff. Inflation is also quantifiably higher than it is in peer countries because of higher import costs. Food price inflation is nearing 15 per cent.

None of these economic indicators of course measure the sheer inconvenience of travelling under a British passport in the European Union nor the cultural/political divisions Brexit has wrought on British society itself, ones that bear a similarity to those playing out in the US.

And the immigration issue Brexit was meant to resolve seems worse or at least no better. You would be a fool to see home secretary Suella Braverman’s incendiary description of incoming migrants as an “invasion” as a verbal slip.

The mini budget controversy was assessed almost entirely within the parameters of its own wonky economic logic and not the Brexit ideology that delivered it.

The Bank of England’s announcement last week that the UK was headed into the most prolonged economic contraction since records began in the 1920s was perhaps the most sobering pronouncement on Brexit to date. The dividend that proponents were promising is, like the US trade deal, nowhere.

And yet there is a near conspiracy of silence domestically around the cause of the UK’s current malaise. The mini-budget controversy was assessed almost entirely within the parameters of its own wonky economic logic and not the Brexit ideology that delivered it.

The shortage of staff, the higher level of inflation, the barriers to trade are similarly decontextualised by Brexit weariness or wary politicians.

Even Labour leader Keir Starmer, the main beneficiary of the Truss government’s disastrous spell in office, seems loath to mention it. He has previously ruled out any return to the single market or customs union while insisting he would do better at removing the “fatberg of red tape and bureaucracy” caused by Boris Johnson’s Brexit deal.

Perhaps the wound is too fresh, the decision too divisive to rehash.