Cable Forum - Britain outside the EU

Concerning opinion piece from Adam Posen, president of the Peterson Institute for International Economics and a former member of the Bank of England’s Monetary Policy Committee. Some extracts.

Quote:

Brexit reality bites as stagflation looms

Sometimes, reality bites. The UK outlook for stagflation of rising prices and slowing economic growth this year and next reflects the realities that Brexit has wrought.

Of course, the Covid pandemic, the difficulties of reopening the economy, and now energy and food price surges are not caused by Brexit.

But the UK’s vulnerability to those shocks, and therefore the amplification of their inflation impact, is largely due to Britain’s departure from the EU. This is why the Bank of England will end up having to raise interest rates over the next year more than it forecast this month, and even more than markets have already priced in. Given the very hard Brexit, the Bank of England and the UK economy have been dragged part way back to the 1970s.

By that, the Bank’s Monetary Policy Committee is no longer able to look past external economic shocks as they did during the 1992 European Exchange Rate Mechanism exit or 2009 sterling depreciation. In these cases, they had the luxury of setting monetary policy solely in terms of hard domestic forecast data. But after Brexit, the MPC would have to worry more about the “spillover” of international events into inflation expectations.

This is due to a combination of the UK being a smaller economy on its own, less buffered by its integration in the EU, and an erosion of trust in UK governments to run disciplined economic policies. Hence, any shocks are likely to result in higher and more lasting inflation than they did before Brexit...

UK price rises reflect, in part, the idiosyncrasies of Britain’s natural gas and food markets. However, the lack of sourcing supply options for agricultural labour and fuel made those inflationary effects worse and more persistent. Implementing trade barriers and new standards between the UK and the EU single market only compound the problem.

https://www.ft.com/content/34eea151-...9-85bac48d8a4c

Pierre

12-05-2022 14:30

Re: Britain outside the EU

Quote:

Originally Posted by 1andrew1 (Post 36122093)

Concerning opinion piece from Adam Posen, president of the Peterson Institute for International Economics and a former member of the Bank of England’s Monetary Policy Committee. Some extracts.

https://www.ft.com/content/34eea151-...9-85bac48d8a4c

That just smacks of a whole lot of opinion, and not much else.

ianch99

12-05-2022 16:41

Re: Britain outside the EU

Quote:

Originally Posted by 1andrew1 (Post 36122093)

This is really a follow up from his 2017 demolition of the Brexit sunlit uplands: https://www.youtube.com/watch?v=EcIkIz98zXU

Yes, "Gravity" still applies. However, it is just an opinion ;)

1andrew1

20-05-2022 11:39

Re: Britain outside the EU

US getting involved now to help resolve Johnson's no-border-in-the-Irish Sea shambles.

Quote:

US delegation arrives in Europe for talks on Northern Ireland and Brexit

Nine-strong team led by close Biden ally will visit Brussels, Dublin and London in significant intervention on division over NI protocol

One of Joe Biden’s closest allies is due to arrive in London on Saturday as part of an influential US congressional delegation seeking to calm tensions over Northern Ireland.

The nine-strong delegation includes Democratic and Republican delegates from the House of Representatives and Senate including members of the powerful ways and means committee chaired by Richard Neal, who will lead the group.

The group was due to land in Brussels early Friday for a series of meetings, including with the European Commission’s vice-president and Brexit commissioner Maroš Šefčovič, to kick off a six-day trip that will also take in Dublin, Kerry and Belfast.

The delegation’s arrival is being seen as a significant intervention by the US, which is acting as co-guarantor of the 1998 Good Friday agreement.

Neal has already made his displeasure known over the government’s plan to draft legislation to remove parts of the Northern Ireland protocol from the Brexit treaty despite warnings it could risk a full trade war with the EU.

But he told the Guardian his mission was to defuse tensions and help broker a UK-EU deal...

After London, the delegation will travel to Dublin to meet the Irish leaders and Belfast to meet Sinn Féin leaders and the DUP leader, Sir Jeffrey Donaldson, whom Neal has met on many occasions.

Their arrival coincides with a warning by Ireland’s deputy prime minister Leo Varadkar that the British position on Brexit was causing such divisions in Northern Ireland it would backfire and “weaken” the union.

“Brexit weakened middle-ground support for the union in Northern Ireland. Unilateral action on the protocol will weaken it even more,” the tanaiste said in an article for the Guardian.

https://www.theguardian.com/uk-news/...eland-tensions

Chris

20-05-2022 12:11

Re: Britain outside the EU

… and the last thing the republic wants is to be saddled with the tantrum-prone money pit that is Northern Ireland. I can see why Varadkar is worried.

1andrew1

20-05-2022 12:27

Re: Britain outside the EU

Quote:

Originally Posted by Chris (Post 36122977)

… and the last thing the republic wants is to be saddled with the tantrum-prone money pit that is Northern Ireland. I can see why Varadkar is worried.

US getting involved is a bit like your parents getting involved with a fight with your mate. A bit embarrassing for us.

Chris

20-05-2022 12:29

Re: Britain outside the EU

Quote:

Originally Posted by 1andrew1 (Post 36122978)

US getting involved is a bit like your parents getting involved with a fight with your mate. A bit embarrassing for us.

No more embarrassing than the US getting involved in the peace process in the first place, or a French Canadian General being asked to verify IRA decommissioning. The US isn’t unilaterally sticking its nose in - it is treaty bound to do so. If you’re embarrassed it’s probably something to do with allowing the Guardian to interpret the world for you. ;)

OLD BOY

20-05-2022 12:48

Re: Britain outside the EU

Quote:

Originally Posted by 1andrew1 (Post 36122978)

US getting involved is a bit like your parents getting involved with a fight with your mate. A bit embarrassing for us.

I’m not at all embarrassed, standing up to these ‘great powers’ that are trying to dictate to us and bring us down.

The amendments we are seeking are simply minor adjustments that will make a big difference without undermining the objectives of the protocol. No international laws are under threat.

1andrew1

20-05-2022 15:16

Re: Britain outside the EU

Quote:

Originally Posted by OLD BOY (Post 36122983)

It's not a great look however you dress it up. There is a mechanism to resolve such issues; Johnson is just pandering to one political party and the whole of the UK is suffering for it. Let's not forget that 60% of the Northern Ireland electorate voted for parties that want to maintain the Northern Ireland Protocol as is and businesses there quite enjoy the benefits of having a foot in the EU market.

When I said the whole of the UK is suffering for it, I am referencing the dispute's very negative impact on the UK's science sector as we are being excluded from the world's biggest research programme.

Quote:

EU blocks UK scientists from €95bn Horizon research programme

Brussels ambassador to London warns row over post-Brexit trade in Northern Ireland is affecting other areas

The EU is blocking British scientists from joining the €95bn Horizon Europe research programme — the world’s biggest — because of the row over post-Brexit trade in Northern Ireland.

The stand-off has alarmed the UK’s university leaders, who have written to British prime minister Boris Johnson pleading with him “to make a personal intervention to break the deadlock” before it is too late. In a letter, seen by the Financial Times, the Russell Group, representing 24 of the UK’s most research-intensive universities, said participation in Horizon was vital in achieving Johnson’s goal of making Britain “a science superpower”. The letter from Tim Bradshaw, chief executive, said Russell Group universities alone had won more than 1,400 European Research Council grants worth €1.8bn, which he said was “more than the whole of France”…

But the Russell Group warned Johnson that the UK being granted associate membership of Horizon was “an integral part” of the country becoming a force in science. It called the programme “the Champions League for research”.’

Separately, Bradshaw wrote to Maroš Šefčovič, EU commissioner in charge of discussions with Britain over the Northern Ireland protocol, to ask him to intervene. “The UK’s full association to Horizon is at risk,” he said.

https://www.ft.com/content/96524f4a-...2-9ae641205e96

Chris

20-05-2022 15:25

Re: Britain outside the EU

Quote:

Originally Posted by 1andrew1 (Post 36122999)

This is the point at which you start sounding like a regime apologist, Andrew.

University research is completely unconnected with the deep sectarian problems that are at the root of the issues HMG has with the NI Protocol. If the EU is making one contingent on the other - or even simply implying a connection - then your uncritical discussion of it is unfortunate to say the least.

jfman

20-05-2022 15:33

Re: Britain outside the EU

I’m not sure how sectarianism comes into signing an agreement you’ve no intention of upholding. Unless the Government is once again a victim of circumstance and couldn’t have foreseen what was apparent to everyone else. The inevitability of a nationalist led NI assembly.

Chris

20-05-2022 15:40

Re: Britain outside the EU

Quote:

Originally Posted by jfman (Post 36123004)

Not sure where you’ve been your entire life but sectarian issues are the entire reason a protocol of some sort was deemed necessary in the first place, owing to the shibboleth of an international frontier on what is, after all, an international frontier between NI and Eire. Everything else that has transpired stems from that root.

jfman

20-05-2022 15:57

Re: Britain outside the EU

Quote:

Originally Posted by Chris (Post 36123007)

Given it’s been an issue my entire life it should surely have been foreseeable to the UK Government?

Essentially we have the UK acting as a bad faith actor signing up to a protocol it had no intention of upholding, promising people the magic beans of “technological solutions” only to walk away from the commitments it made to then have the gall to be act completely surprised that others won’t roll over.

1andrew1

20-05-2022 16:45

Re: Britain outside the EU

Quote:

Originally Posted by Chris (Post 36123002)

I think you're unrealistic in expecting one body to start going out of its way to sign more agreements with another one, when the last agreement it signed with that body is in danger of not being honoured.

If you have a decorator in who doesn't do what they promised to, you don't normally rush to invite them to decorate another room!

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