Matthew d’Ancona: Hammond pilloried for daring to look at the Brexit small print
It’s the role of all chancellors to urge caution. But his Tory enemies merely want a cheerleader for the hardest of EU exits
Philip Hammond, U.K. chancellor of the exchequer, sits during an International Monetary Fund Committee (IMFC) plenary session at the International Monetary Fund (IMF) and World Bank Group Annual Meetings in Washington, D.C., U.S., on Saturday, Oct. 14, 2017. Photographer: Andrew Harrer/Bloomberg
The book The Power of Positive Thinking introduced the notion that you can shape reality by mere “affirmations”. It has many adherents, as does the more recent nonsense of The Secret, which ascribes similar potency to “visualisation”.
I suppose snake oil of this sort might help some people get through the day. But it is no basis upon which to govern a country – or to negotiate a country’s exit from a vast commercial and geopolitical alliance. Wishing upon a star is not enough for a successful departure from the EU.
Yet this is precisely what the exasperated Jiminy Crickets of Brexit are demanding of chancellor Philip Hammond . On Thursday, John Redwood tweeted: “The Chancellor must get the Treasury to have more realistic, optimistic forecasts & to find the money for a successful economy post Brexit.” Nadine Dorries, meanwhile, complained: “We need a ‘can-do’ man in the Treasury, not a prophet of doom.”
By something close to constitutional convention, the chancellor is the government-of-the-day’s Dr No . Whoever holds this great office of state must personify prudence, protect the public finances, resist all harebrained schemes that will jeopardise jobs, or otherwise imperil prosperity. That, at least, is the job description. So it is innovative, not to say extremely stupid, to insist that Hammond suddenly pick up the pom-poms of the cheerleader and whoop that “Brexit totally rocks!” Maybe it’s just me, but I’d rather not have a chancellor who behaves like the man on the bungee launchpad paid to say “jump”.
Not that we should be surprised. In politics, each action usually has an equal and opposite reaction, and the present calls for Hammond’s head are the symmetrical consequence of the briefing against Boris Johnson during the Conservative conference. In Manchester, the foreign secretary declared it was time to “ let the British lion roar ”. Now his fellow Brexiteers want the lion to bite off Hammond’s head.
The latest charge levelled against the chancellor concerns his alleged failure to prepare with sufficient enthusiasm and application for a “no-deal” outcome. All departments have been instructed to make contingency plans for the collapse of David Davis’s negotiations with Michel Barnier. But Hammond’s foes want to see the public coffers opened, and money splashed out to make Britain ready for the cliff-edge. Of Hammond’s refusal to spend, former chancellor Lord Lawson said last week: “What he is doing is very close to sabotage.”
Spent on what, though? Were Britain to crash out of the EU at the end of March 2019 without a deal, it would be subject to the rules of the World Trade Organisation – meaning export tariffs of 10% on cars, 36% on dairy products, and high levies on clothes, footwear, chemicals, aerospace transactions and much else. The customs system would grind to a halt. International regulation systems would vanish, replaced by an economically disastrous vacuum.
It is pitifully deluded to suggest that spending a few billion here, and a few billion there, is going to prepare the UK for such an outcome. As Hammond himself has suggested, the only way for Britain to cope with such a calamity would be for it become an entirely different kind of country: low-tax, low-regulation, a Singapore of the west. The problem is that the British themselves would never tolerate the inevitable consequences of such a transformation – the drastic shrinkage of public services, the welfare state, and core social entitlements.
As the talks stall, I sense that a growing number of Brexiteers see ‘no deal’ not as a threat but as an objective
Small wonder that Kenneth Clarke and other Tory remainers are tabling an amendment that would write the two-year transition plan into the EU withdrawal bill – effectively giving the Commons the ability to reject Brexit entirely if no agreement is reached with Brussels. At present this stands little chance of becoming law; but it will remind Theresa May and her whips that the parlous state of the EU talks is jeopardising her already-precarious majority. (At the same time, the Democratic Unionist party – whose 10 MPs are essential to the prime minister’s parliamentary survival – is said to be irritated by Hammond’s conduct.)
As it happens, I believe that May’s public readiness to countenance a “no-deal” outcome reflects a strategy rather than a secret yearning. She calculates that the EU will not negotiate fairly unless its 27 other member states believe we are ready to walk away without an agreement. But, as the months pass and the talks stall, I also sense that a growing number of Brexiteers see “no deal” not as a threat but as an objective. Before the election one cabinet minister close to the talks told me that “life under WTO rules would be perfectly OK, you know.” Really?
At the same time, to take a specific example, there is serious talk of shifting from the jurisdiction of the European Medicines Agency to that of the US Food and Drug Administration: the FDA may be in Maryland, but at least it is not subject to the European court of justice. Again: is this truly what Britons were voting for in last year’s referendum?
For daring to look at the small print of Brexit and failing to declare the whole process “doubleplusgood”, Hammond is now pilloried by the faction within his party that, whatever its numerical strength, shouts loudest. A senior Tory told me recently that what the country needed was not a new centre party but a proper Conservative party. His point was that the Tory movement, once remorselessly committed to the business of government and the hard realities of office, had sailed off into the seas of ideology, captured by a gang of pirates seeking the imagined treasure of Brexit Island.
In her interview with the BBC’s Andrew Marr, Hillary Clinton reflected that, in modern politics, “being thoughtful is viewed as being somehow inauthentic. If you’re taking your time formulating an answer to a very difficult question … that’s not as immediately satisfying as coming out with some rhetorical blast.” The defeated presidential candidate wondered if there were resonances in this country, and indeed there are.
Hammond is hated by his enemies because he puts fact before emotion, and refuses to join in the feelgood fantasia. It is bleakly ironic that those who are working hardest to mitigate the most damaging consequences of Brexit are routinely accused of undermining the whole process. If only the chancellor would think positively, it would all be fine. Wouldn’t it?
Matthew d’Ancona is a Guardian columnist