Eco­nomic per­ils make Brexit look still worse

The Woolwich Observer - - COMMENT - WORLD AF­FAIRS

IT WAS EI­THER IG­NO­RANT or ir­re­spon­si­ble for those cam­paign­ing for Brexit (Bri­tish exit from the Eu­ro­pean Union) two years ago to claim that the Ir­ish bor­der would not be a prob­lem. In fact, it may lead to a cat­a­strophic ‘no deal’ Brexit in which the United King­dom crashes out of the EU with­out an agree­ment of any kind.

Both the Bri­tish ne­go­tia­tors and their EU coun­ter­parts say that the deal is “95 per cent agreed”, but the other five per cent is the bor­der be­tween the Repub­lic of Ire­land (an EU mem­ber) and North­ern Ire­land (part of the UK and there­fore soon not part of the EU). Time is run­ning out, and agree­ment on that last five per cent is far from cer­tain.

The bor­der has been in­vis­i­ble since the sign­ing of the Good Fri­day agree­ment in 1998 ended 30 years of bloody con­flict be­tween the Protes­tant and Catholic com­mu­ni­ties in North­ern Ire­land. Three thou­sand peo­ple had been killed, but the sit­u­a­tion had reached stale­mate. The Good Fri­day deal let both sides ac­cept that fact.

For the (Catholic) na­tion­al­ists in North­ern Ire­land, a com­pletely open bor­der with the (Catholic) Repub­lic was a vi­tal part of the deal. It im­plic­itly ac­knowl­edged that the two parts of the is­land might one day be re­united, although not now.

As the 1998 agree­ment plainly said, peo­ple born in North­ern Ire­land have the right to be “Ir­ish or Bri­tish or both as they may so choose.” And it worked, sort of: the only way you can tell you have crossed the bor­der now is that the speed signs change from miles to kilo­me­tres or vice versa.

It was a brave, imag­i­na­tive deal that has given North­ern Ire­land 20 years of peace, but it is now at risk. When the ‘Leave’ side nar­rowly won the Brexit ref­er­en­dum in the UK and Theresa May re­placed David Cameron as prime min­is­ter in 2016, she had a cred­i­bil­ity prob­lem. Like Cameron, she had sup­ported ‘Re­main,’ but the Con­ser­va­tive Party she now led was dom­i­nated by tri­umphant Brex­iters.

So she be­came an en­thu­si­as­tic Brex­iter her­self. The English na­tion­al­ists who ran the Brexit cam­paign had said noth­ing about leav­ing the EU’s ‘sin­gle mar­ket’ and cus­toms union, but within weeks of tak­ing of­fice May de­clared that Bri­tain must leave both of them.

She even made this de­mand part of her fa­mous ‘red lines,’ the non­nego­tiable min­i­mum that the Bri­tish gov­ern­ment would ac­cept in the di­vorce set­tle­ment. Un­for­tu­nately, end­ing the cus­toms union would mean re-cre­at­ing a ‘hard’ bor­der be­tween North­ern Ire­land and the Repub­lic – and that might lead to a re­newal of the sec­tar­ian civil war be­tween Catholics and Protes­tants in the North.

It’s not clear when the Con­ser­va­tive gov­ern­ment in Lon­don re­alised that the Ir­ish bor­der was go­ing to be the big­gest stum­bling block on the road to Brexit, and the party’s more ex­treme Brex­iters are still in de­nial about it. But the Repub­lic will stay in the EU, and it in­sists that there must be no hard bor­der af­ter Brexit. Ire­land has seen enough killing.

No hard bor­der is there­fore an EU red line, and it’s im­pos­si­ble to square that with May’s de­ci­sion to leave the EU cus­toms union. If there is no cus­toms union, then there have to be bor­der checks. And maybe a new war in the North.

So the EU sug­gested a ‘back­stop.’ If Lon­don and Brus­sels can’t come up with a free-trade deal to keep the bor­der soft (i.e. in­vis­i­ble), then North­ern Ire­land could stay in the cus­toms union, and the rest of the UK could leave. The real bor­der, for cus­toms pur­poses, could run down the mid­dle of the Ir­ish Sea.

Theresa May ac­tu­ally signed up to this so­lu­tion last De­cem­ber, be­cause the only real al­ter­na­tive is a hos­tile Brexit that sim­ply ig­nores the EU’s po­si­tion. But no sooner had she agreed the ‘back­stop’ with the EU than rebels in her own camp – ex­treme

Brex­iters and mem­bers of a small North­ern Ire­land­based Protes­tant party whose votes are all that keeps the Con­ser­va­tives in power – forced her to re­pu­di­ate it.

Now May’s po­si­tion is pure fan­tasy: no cus­toms bor­der with the EU ei­ther on land or in the Ir­ish Sea. Which is why the prob­a­bil­ity of a chaotic ‘no deal’ Brexit is grow­ing daily, and the prospect of re­newed war in the North is creep­ing closer.

Is re­newed war re­ally pos­si­ble? Last year Sinn Fein, the lead­ing Catholic party in North­ern Ire­land, with­drew from the ‘pow­er­shar­ing’ gov­ern­ment man­dated by the Good Fri­day agree­ment. That could be seen as clear­ing the decks for ac­tion once it be­came clear that Brexit would un­der­mine all ex­ist­ing ar­range­ments in Ire­land.

And if the UK crashes out of the EU with­out a deal, the rat­ings agency Stan­dard and Poor’s pre­dicted on Tues­day, un­em­ploy­ment in the UK will al­most dou­ble, house prices will fall by ten per cent in two years, and the Bri­tish pound will fall even fur­ther. First im­pov­er­ish­ment for the Bri­tish, then war for the Ir­ish.

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