Britain, an island state highly dependent on imported food, has been lucky not to go hungry during the coronavirus crisis. At the outset of the emergency, when a loo roll was harder to find than a bar of gold bullion, I detected considerable fear among officials and ministers that panic buying would clean out supermarkets and spark food riots. Some of them remembered the old saw that anarchy is only three missed meals away.
That ugly scenario, which would have added civil disorder to killer contagion, was avoided because supply chains have been protected. Cargo ships and lorry drivers have continued to make deliveries from our neighbours in Europe. Even as borders were closed to most other traffic, everyone came to the sensible conclusion that frontiers had to remain open for freight. For the same reason, the new 14-day quarantine rule that the government is imposing on travellers will not be applied to those hauling goods.
Tariff-free and frictionless trade have played vital roles in enduring this emergency. And thanks for that is due to Britain’s membership of the European Union. I doubt you will ever get anyone from Boris Johnson’s Brexiter government to acknowledge this, but the EU helped to prevent the crisis from becoming even more diabolical. Though the UK formally left at the end of January, this made little practical difference to trade because we entered a transition period during which Britain has continued to enjoy the benefits of the single market.
We cannot know when the coronavirus will go away. We do know that the transition expires at the end of this year. If there’s no trade deal with the EU by then, Britain will be hurled into 2021 with price-inflating duties on imports, serious burdens on exporters and friction-heavy checks at borders. Brexit ultras are trying to make that sound like a benign scenario by rebadging it as an “Australian-style” outcome, but this would be no picnic on Bondi beach.
The CBI says that the coronavirus has left companies with “almost zero” resilience to a chaotic exit from the single market. Most analysis suggests that the hardest hit regions would be those where many voted Tory for the first time in 2019. Nissan has just warned that it could not guarantee the future of its car plant in Sunderland. The Bank of England is telling financial institutions to be prepared. The International Monetary Fund estimates that a no-deal Brexit would compound the coronavirus havoc by inflicting further scarring on the economy and a permanent loss of 5% of GDP. For many companies fighting to keep their heads above water in a virus-induced recession, a crash-out of the single market will be like fitting concrete overshoes to a man who is already close to drowning.
Why then is such a horrific double-whammy even conceivable? Four rounds of talks with Brussels have gone badly and Boris Johnson has set an adamant face against asking for an extension to the transition. Negotiations by videolink are not a satisfactory substitute for meeting face to face. As one veteran of bargaining with Brussels says: “You can’t have those quiet, informal corridor conversations where you say, ‘If we give a bit on this point, can you give something on that point?’”
There might be a chance of overcoming that handicap with goodwill, but the talks have been characterised by mutual distrust, grandstanding and temper tantrums.
Each side accuses the other of being unreasonable. The EU is right that the Johnson government has been backsliding on commitments made in the withdrawal agreement, behaviour that has deepened their pre-existing suspicions of a British prime minister who caused enduring offence by comparing the EU to Nazi prison guards. The British government is right that some of the EU’s demands, especially on fisheries and state aid, are too aggressive.
The rawest complaint from London is that the EU is treating Britain as a supplicant rather than an “equal” sovereign state. The EU retorts that the Johnson government is not, as it claims to be, seeking a free trade agreement, but demanding the right to cherry-pick privileged access to the single market.
Both sides now sound resigned to the idea that there’s no chance of an agreement before October, perilously close to the cliff edge. Number 10 is making noises that the negotiations need to be taken to a higher level by engaging heads of government. The trouble is that European leaders are bored stiff with Brexit and the coronavirus crisis has pushed it further down their list of priorities.
EU leaders are also bound to ask themselves whether a British government heavily populated with some of the most hardline Brexiters wants the negotiations to succeed anyway. They can hear the faction of Tory ultras who argue that no deal the EU will ever offer can be a deal worth having. In the cabinet, Dominic Raab, the foreign secretary, and Priti Patel, the home secretary, are among ministers who lean in that direction. A crash-out was emphatically not what was promised when Brexit was sold to the public with the reassurance that negotiating a trade agreement with the EU would be a “piece of cake”. At the December election, Mr Johnson told the British people that he had an “oven-ready deal”. What we get now from his kitchen is the smell of something burning.
Some people close to the prime minister have been telling their friends in the media that this breach of trust won’t matter because the economic damage will be masked by and can be blamed on that caused by the disease. This is like telling a man who has been deprived of both his arms that he won’t notice losing his legs as well. This theory is unconvincing even to many Tories. As one former cabinet minister remarks: “We’ll most likely be in a terrible recession at the turn of the year and you’ll have bankrupted businesses popping up saying this was the last straw. They’d say they had managed to survive the coronavirus, only to be killed by a crash-out of the single market.”
The view that this would be crazy has some representation around the cabinet table. A few moderate voices survived the purge of the Remainers that Mr Johnson conducted when he became prime minister. Robert Buckland, the justice secretary, is one of the residual sensibles in the cabinet. So probably is Matt Hancock, but the health secretary has other things to worry about at the moment. The most intriguing figure is the chancellor. Rishi Sunak was a keen Brexiter, but the Treasury as an institution is appalled by the prospect of a no-deal outcome and colleagues suspect that Mr Sunak has lost any enthusiasm he might once have had. The chancellor borrowed more than £60bn in April alone to pour funds into business support programmes and job retention schemes. A lot of that money will be squandered if a crash-out then pushes many businesses under anyway.
Some observers say that it doesn’t really matter how the cabinet splits because it doesn’t really matter what the cabinet thinks. “Most of them will just nod along to whatever Boris decides to do,” predicts one senior Tory.
Some argue that the prime minister genuinely wants a deal, but believes that the way to get to it is to play hardball. It was his consistent critique of Theresa May and David Cameron that they got lousy offers from the EU because they were never prepared to threaten to walk away. It is contended that a tight deadline and a tough stance will force concessions from the EU. “They’ll be desperate for a deal by the autumn,” claims one senior Brexiter. Did he not, say Mr Johnson’s cheerleaders, confound all the doubters last autumn when the EU agreed to rewrite the deal it had signed with Mrs May? Yes, there was a change to the agreement, but not because Mr Johnson is a genius at brinkmanship. He got a deal by making an almighty concession on the Irish backstop, which, as the government belatedly conceded under the cover of the coronavirus crisis, puts a regulatory border between Northern Ireland and the rest of the UK.
This prime minister has a flair for putting a boastful face on failures to keep his promises – witness his “world-beating” handling of the epidemic – but it fools only those who don’t bother to check the fine print.
It would be madness for Britain and bad for the EU not to reach an agreement. Where there’s a will, there’s a way. There’s a way. The question is whether there’s the will. If there’s not, a crisis triggered by a microbe will be calamitously compounded by a disaster that will be entirely manmade.
• Andrew Rawnsley is Chief Political Commentator of the Observer