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Not A “Red Letter Day” For The Government

Not a “Red Letter Day” for the government

If anyone in the Conservative Party hasn’t realised how far it’s strayed from its traditional supporters, the recent debacle about a letter of support for government policy from British business must surely bring it into sharp relief.

It’s not that the government has failed to get such a letter published (so far), after a period of lobbying FTSE 100 companies  which is particularly shocking, but rather than No 10 thought it had any chance of doing so.  Of course, the continual slagging off of business by Theresa May and her colleagues won’t have helped but most FTSE companies are pretty much used to being whipping boys for the politicians.   That’s not it.  Perhaps the Cabinet don;ty understand the resistance, but if they don’t, a simple phrase will spell it out: “It’s the economy, stupid!”

Brexit was always going to be a problem for many UK companies.  Even exporters often import a multitude of components and need fast and cost-free arrangements for them to arrive.  Banks of course have benefited from passporting.  Airlines need free access to EU airports and transport companies can’t afford long delays at borders.  Hotels, restaurants, pubs, farmers and the building industry need workers willing to take on the relatively low-skilled jobs which many British citizens don’t want – and would not want even at significantly higher salaries.  Manufacturers and especially inward investors needs to know that goods manufactured here can be exported to EU markets without either tariffs or, more dangerously, the so called “non-tariff barriers” which usually amount to thinly veiled regulatory reasons to keep out another country’s goods. So a Brexit which may lose all of those things is a disaster for British industry.

Nor are businessmen  and women who, let’s face it, spend a good deal of their time in negotiations, much taken with the David Davis approach to the deal of (i) being grossly unprepared and (ii) making demands which the other side is never going to meet while also (ii) begging for the EU to “be nice” and start talks on a trade deal before the exit is agreed.  Article 50 was deliberately designed to put a country wanting to leave in EU in a corner and it’s absolutely done that. One has to hope the government realises the weakness of its position  – there is no scenario more depressing than thinking you’re coming at a problem from a position of strength only to realise halfway through that you’re the supplicant.  The UK under May is perilously close to that scenario and business will not  – ever – forgive the Conservatives if they screw this one up.