The Brexit negotiations stall

To no-one’s very great surprise, the UK’s negotiations with the EU-27 over its exit from the EU have failed to progress.  The UK was hoping that the latest round of negotiations between Michel Barnier and David Davis, which took place earlier this month, would pave the way for both sides to “move to the second stage” in the jargon, in other words start talking about the future relationship between the UK and the EU after the UK’s departure.

Unfortunately the EU has decided that not enough progress has been made on the initial three issues – the financial settlement, the status of EU citizens in the UK (and UK citizens in the EU), and the Irish border.  And, despite some slightly more emollient talk about the EU-27 team “beginning the internal discussions for the preparation for stage 2” – largely a fig-leaf to show that the EU is not being entirely negative – the negotiations themselves are therefore still stuck firmly at the first stage.

This is clearly frustrating for the UK Government, and there is almost certainly an element of truth in David Davis’s somewhat undiplomatic observation that “it’s all about the money – they want us to pay more”.  That would only be natural:  the EU are in a very strong position in these negotiations and the sums at stake are not inconsequential in the context of the EU’s budget, so there is every incentive for them to hold out for as favourable a financial settlement as possible.

But that is not the only or even the main reason for the impasse.  As well as believing that the British government have not offered enough money (or rather, that they can be made to offer more), the EU is not even sure that they are good for what money Mrs May has so far put on the table.  Until there is concrete evidence that the Cabinet will support her and agree to the amount she offered in her Florence speech, and in turn that the House of Commons will approve the expenditure as part of the legislative process agreeing the exit deal, the promises are widely seen on the Continent as worth very little.

Put simply, when viewed from Brussels, Britain’s reliability as a negotiating partner who will honour their word is deemed low, and certainly insufficient for the EU-27 to consider making significant concessions to them.

Beyond this, there is perhaps a deeper reason still for the failure of the negotiations to progress.  And this is to do with the very nature of the EU itself.  As we observed in our last essay (“Mrs May does just enough”, 27.09.17), the EU is a rules-based and treaty-based organisation, and prioritises adherence to its legal framework very highly.

Politicians and commentators alike in the UK nod sagely whenever this point is made.  “Of course”, they say, “we know that”.  But very few people in the UK really understand quite why this is so or quite how fundamental it is to everything the EU does.

In part this insistence on explicit rules is due to the sheer size and diversity of the EU.  Like any very large entity, it becomes difficult to appeal to an implicit common understanding, because the disparate components of the whole have different interpretations of what that common understanding is.  Thus instead of “everyone knowing” what is meant by something, it has to be formally spelled out[1].  The United States, with its similar size and similar diversity of backgrounds and cultures, is equally unable to rely on “common-sense” across its entire citizenry, and is as a result no less rules-based – indeed it often surprises Europeans how rules-bound American public life is.  And China, Russia, India – all large, multicultural states – are bywords for bureaucratic rules-based societies.

But on top of this, the structure of the EU, with its national politicians from the heads of government down only answerable to national electorates, creates a dynamic in which in any discussion in the EU’s central decision-making bodies, for example the European Council, however communautaire the general discussion is on the surface no politician can ever fully ignore the need to avoid being seen back home as the patsy that other states have taken advantage of.

Experience has shown the EU that the best defence against countries continually trying to take advantage of each other in an unseemly rules-free jockeying for position is to codify the conduct of the EU to a very much more precise degree than is common in smaller more homogeneous entities.

The result is that the EU can seem slow, inflexible and in passing unresponsive to the needs of its citizens.  It does not always seem to place a very high priority on solving the problems that ordinary citizens face.  In place of the infuriating “Computer says no” that seems to characterise much of modern life, Brussels sometimes seems to be permanently in “The Rules say no” mode[2], almost regardless of the consequences for society.  This was perhaps most brutally shown in the treatment of Greece in its long debt crisis:  no politician who had to face the Greek electorate would have promoted a “solution” which caused so much damage to Greek society – but the politicians who decided the fate of Greece were spared ever having to justify and defend their decisions to the Greek people.

This is not to say that EU politicians cannot “do” problem-solving.  The most famous example was possibly Mario Draghi’s defence of the single currency, when at the height of the euro crisis in 2012 he declared “the ECB is ready to do whatever it takes to preserve the euro”[3].  This is the quintessential statement of a problem solver not a rules enforcer, and it was not entirely a surprise that those in the EU who place most store by the rules – including prominently, but by no means only, the Germans – struggled to accept the ECB’s bold approach.

More relevant perhaps is the second great example of a politician in problem-solving mode in the last few years, when Angela Merkel decided that the challenge of the migrants needed a bold solution and decreed that Germany would take all who came.  Again, her oft-repeated comment on this radical policy, “Wir schaffen das” or (loosely) “We can do this” is the classic statement of a problem solver.  But sadly her boldness was ill repaid:  the policy led to huge tensions with fellow member states, the near collapse of the Schengen Agreement and, some would argue, her poor showing and the rise of the far right AfD party in last month’s German federal election.

Merkel, and indeed the whole EU political class, has drawn the lesson from that that the rules matter;  the message has been reinforced, and the EU body politic is now even more firmly of the view that there is only downside in bending its rules.  And inevitably, no reason at all to bend them for a state which is seeking to become a non-member.

The UK, which has a problem and needs a solution, is at this stage of the negotiations overtly in problem-solving mode;  in effect, Mrs May is close to Draghi’s “whatever it takes” state, and we are not alone in suspecting that one of the things it will take is a much larger financial contribution from the UK.  But the British government has yet to fully appreciate that the EU shares neither their urgency nor their prioritisation for a solution, and is therefore still firmly in rules-based mode.

And it is not clear that this is going to change any time soon.


[1]              The classic example of this is timekeeping for meetings, where “a meeting at 11.00” is interpreted very differently in different parts of the EU and where in response, Brussels has had to go to the length of promulgating a formal rule that “meetings at the European Commission will start at the time stated” to avoid any misunderstandings.  A very small example, but no national civil service has ever needed to create such a rule for its internal meetings, because the meaning of “a meeting at 11.00” is understood in the same way by all participants.

[2]              We have heard from a number of sources that often one of the tipping points for those ministers who support Brexit was when they were told once too often by their senior civil servants that “Minister, EU rules mean you cannot do that”.

[3]              Mario Draghi, speech in London in July 2012.  See