Why ‘no deal’ is not a viable negotiating strategy

government

Despite being adamant that the UK would leave the European Union ‘come what may’ on 31 October, parliament seems to have scuppered Boris Johnson’s plans for the time being.

It has been suggested that keeping a no deal scenario on the table should be a key negotiating tactic and by voting to block this parliament have ruined the UK’s chances of getting a good deal.

However, this line of argument shows the UK government’s profound and continuing lack of understanding, wilful or otherwise, about the EU’s position regarding all of this.

The merits of a no deal Brexit

Supporters of a no deal Brexit have flipped between arguing it is what people voted for and saying that they would rather leave with a deal, but threatening to leave without one is the only way the UK can get the deal that it is due.

For this strategy to work, the EU needs to fully believe the UK is willing to leave without a deal. With this being the case, the EU will blink at the last minute and give the UK the concessions it wants.

There is however a curious duplicity in this strategy. The EU is supposed to be so terrified of a no deal situation that they will give into the UK’s demands. Yet at the same time, the UK public are supposed to embrace a no deal as a fantastic opportunity.

This contradiction aside, the logic of this tactic is flawed because it assumes that the UK and EU have the same priorities and concerns. It assumes that a no deal situation is the worst outcome for the EU going forward. However, from the EU’s perspective, a no deal situation is the UK’s worst-case scenario, not theirs.

Disruption

Warnings about the various problems that could be caused by leaving without a deal have been abundant. Concerns about the Irish border, disruption to supply chains, inflation and recession have been well document, albeit that they are often dismissed as ‘project fear’.

The ‘Operation Yellowhammer’ report, which parliament recently forced the government to release, agrees with such predictions even after being redacted in places. It suggests that such disruption will likely occur in a base-scenario, rather than a worst-case scenario as some are claiming.

Regardless, those pushing this no deal strategy argue that the detrimental effects to the EU would be just as bad. The EU exports £345 billion worth of goods to the UK every year and they won’t want to put this in jeopardy.

The German car industry, among others, needs access to our markets and will pressure their governments to make sure a deal is reached.

Negotiating flaw

However, the major tactical flaw in threatening a no deal in order to bounce the EU into giving the UK a deal is that it overstates the UK’s leverage over the EU.

The EU view the damage in relative, rather than absolute terms. No deal will be bad for the EU, but as far as they are concerned it is the worst possible option for the UK, not the EU.

For the EU27, allowing UK to cherry-pick the components of the deal presents a serious threat to the integrity of the single market and the stability of the EU itself. The consequences of this, as far as they are concerned, are far greater than those posed by than a no deal Brexit.

Of course, the EU would rather not have to make that choice: they would rather the UK left with a deal. But at the same time, they still view leaving with a deal as an inferior option compared to remaining as a member.

Lack of understanding

This does not mean that the EU are trying to force the UK to remain a member, if anything many on the continent just want the whole thing to be over. The point is that the UK and the EU evaluate the situation very differently, and that is in no small part responsible for the present situation.

While Brexit has been the dominant issue within the UK in recent years, for the rest of Europe it has been just one of many occupying their attention.

Before David Cameron came to Brussels demanding a renegotiation of the UK’s membership terms the EU was trying to manage the substantial problems caused by the Greek debt and migrant crises, both of which the UK had mostly stayed out of.

In the early days, this lack of understanding worked both ways. Much like David Cameron, leaders such as German Chancellor Angela Merkel didn’t seriously believe that the UK public would vote to leave the EU.

But after the news broke that UK voters had chosen to leave, the primary concern on the continent was of damage limitation, not with regards to the UK but to the other 27 member states.

Fears that other nations would follow the UK’s example failed to materialise as continental solidarity strengthened and the remaining member states worked out how they wanted to proceed and who should do the negating on their behalf.

Compared to the turmoil within the UK political system, outwardly the EU27 have been remarkably unified and consistent.

The single market

What EU leaders decided following the referendum, and have stuck to ever since, is that the integrity of the single market and the continuation of the European project is paramount. The UK cannot ‘have its cake and eat it’ because that would risk compromising the very foundations of the EU itself.

Allowing the UK to cherry-pick would demean the value of EU membership and risks encouraging others to do the same. While there will be an economic hit to Europe if the UK leaves without a deal, this is nothing compared to the hit Europe will take if the single market collapses.

For the EU27, a no deal scenario is the lesser of two evils and not the threat the UK government claims it to be. The picture for Europe is a lot bigger than the UK is willing to see.

By Christopher Stafford, Doctoral Researcher in the School of Politics and International Relations at the University of Nottingham. 

Disclaimer:
The views expressed in this analysis post are those of the authors and not necessarily those of the UK in a Changing Europe initiative.

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