Lifestyle & Culture

Brexit Diary: ‘Wait, no one told us that was going to happen’ (Actually, they did)

Though it’s only been five years, it seems like the Brexit referendum took place several lifetimes ago, so we’ve forgotten most of the early details. But back in 2015 and 2016, brave Brexiteers Nigel Farage, Arron Banks and, yes, Boris Johnson were leading us to the Elysian Fields of a United Kingdom freed from the velvet tyranny of the European Union.

A few business leaders and economists tried to inject reality into the Brexit debate with warnings about the huge dent Brexit would put in the UK’s economy, but they were quickly shouted off the stage with cries of “Remoaners!” and “Operation Fear!”

Alas, business people operate on objective analysis and empirical data while Brexiteers were selling a feel-good return to Britain’s glorious past… which turned out to be the stiff upper lip England of shortages and sacrifice that followed World War II. It wasn’t too difficult to see even in 2016 that Brexit was going to be not so much a right turn to greatness as a detour to disaster … confirmed when the people who financed Brexit, including billionaire industrialist James Dyson, pulled up sticks and moved bases of operation either to the EU or Asia.

So, we’ve created a new post documenting the glory as unrelenting waves of greatness wash over the British Isles:

• A mere nine months into its liberation from the European Union, the United Kingdom is finding that Brexit was exactly the wrong idea at exactly the worst time. Instead of the sun never setting on robust new trade deals around the globe, the UK has managed to entice one new trading partner, Norway. Now, British citizens will have unlimited access to rakfisk. But the big deal with the United States the Brexiteers including Boris Johnson promised – worth an estimated 200 billion pounds – isn’t going to happen. At least not while Joe Biden is the US president. As British Environment Secretary George Eustice told Sky News: “It’s just not a priority” for Biden. Could that be because Biden isn’t stupid and understands that $800 billion in trade with the EU, and therefore with Germany, France, Italy, the Netherlands and other economic giants, is a priority? And by the way, British exports to the Republic of Ireland fell by 2.5 billion pounds this year, according to the BBC.

• After kicking out all those lazy Europeans, there are now plans afoot to bring them back. Food and Drink Federation boss Ian Wright is supporting the Seasonal Workers Pilot to create 30,000 visas for workers to come to the UK for up to six months to solve the delivery truck driver shortage crisis. Oh, and that Britain goes-it-alone approach of Nigel Farage, Jacob Rees-Mogg and other hardline Brexiteers appears to have lost out to reality. British officials have agreed to spend millions ot restart an American carbon dioxide plant that’s crucial to food production. CF Fertilizer had shut down British operations due to the high price of natural gas. CF Fertilizer’s CO2 is used to “stun animals before slaughter, preserve fruits and vegetables before packaging and put the fizz into carbonated beverages,” according to US News and World Report.

Supply chain issues related to Brexit restrictions are so bad that Bonfire Night celebration will be muted because there aren’t enough fireworks, according to City A.M. That’s because fireworks from China come to the UK via ports in the EU. They didn’t put that on the side of a bus, did they?

• If there is any good Brexit news, it’s that – along with blue passports – the imperial system is making a comeback in the UK over the metric system. It will no longer be required that packaging/labeling include metric measurements, according to The Conversation. Of course, the problem is, an imperial gallon in the UK isn’t the same as a US gallon. And don’t get us started on how many tablespoons are in a quart.

• Those chickens … they do have a tendency to come home to roost. Some of the most adamant Brexiteers are now seeing their businesses dinged by the unintended results of closing the door to Europe. The exit of tens of thousands of people back to the Balkans and Eastern Europe has lead to labor shortages, with Britain’s supply chain struggling. That includes mega-Brexiteer Tim Martin, owner of the J. D. Wetherspoon chain of pubs, who’s having trouble getting Bud Light to his patrons because the UK is 100,000 HGV drivers short. That’s not to mention the shortage of warehouse workers and people to take up the slack in the hospitality industry.

The number of Romanian and Bulgarian workers in the UK, who used to fill lower-paid logistics and food production roles, has plunged by almost 90,000 – or 24 percent – since the end of 2019, according to the Guardian.

Now Martin and other Brexiteers are demanding Boris Johnson do something about this shocking situation and change the visa restrictions that changed with Brexit. Johnson has refused, saying all British companies have to do is just go out and recruit good British workers. Demographers say good luck with that … that the UK’s aging population is running on empty when it comes to low-skilled labor.

Now, it looks like the big Brexit payoff will be a beerless, cheerless Christmas for Brits. And Martin? Well, shame on him for not moving his business to Asia like fellow Brexiteer Jimmy Dyson. With the gates shut to the EU, Britain’s option is now, ironically, to start integrating more of the migrants arriving from the Middle East, African and Asia into the workforce. Which is doubly interesting since the fall of Afghanistan.

• Lost amid the angst over supply-chain disruptions is the effect Brexit is having on the ag sector. Which could translate into some Brits substituting fish and chips for the Christmas turkey. Companies in the UK’s poultry sector are warning there could be turkey shortages this year. The poultry industry employs more than 40,000 people but there are nearly 7,000 vacancies, according to the Guardian. That will only get worse as the industry depends on seasonal workers to put turkeys on the table, as well as chickens in the local KFC, at the holidays.

Meanwhile, the Daily Express and other right-wing British tabloids are giving their readers alternative facts about the Netherlands and Denmark suffering horribly. Take that, remoaners! Unfortunately, the stories are not even remotely true.

• The latest labor shortages have been years in the making. For decades, the United Kingdom – as part of the European Union – has relied on low-paid workers from Poland, Bulgaria and Romania to take the jobs Brits won’t do. When Dispatches was in England a few years ago, all the car washes were run by hard-working Polish entrepreneurs. Now, post-Brexit, a lot of those people have left and suddenly, there are posts on BBC, Bloomberg and other news and business websites about – get ready for it – a massive labor shortage, with more job openings in the hospitality business than at any time since record keeping began, perhaps 1.1 million.

“Is there a solution to the hospitality staff crisis?” asks a BBC headline. It turns out that Brits do not fancy 70-hour weeks for minimum wage … shocker.

The Guardian has a post, “Employers offer golden hellos of up to £10k amid worker shortage,” with the bonuses going to nurses willing to work the night shift in hospitals and care homes. So far, few takers ….

• Speaking of money, Brexit is still sorting out which city will replace London as a banking and financial transactions center post-Brexit. It looked for awhile as if Amsterdam would be the big winner. Now, London is back in the lead. Lost in the fray is the fact that Asian cities such as Singapore – where industrialist and Brexiteer James Dyson moved his operations post-Brexit – will be the ultimate Brexit winners.

From “The Conversation”:

Strikingly, we see increasing growth in Asia between 2016 and 2019 in sectors like travel, financial, IT and creative services. This includes extraordinary growth in Singapore in finance, business, insurance and pension provision, and also in China in numerous segments. It looks like nothing short of a boom.

Apparently Dyson got it just about right ….

• If there was one certainty in Brexit, it was that the United Kingdom would pay and pay bigly to leave the European Union. The final figure is 47.5 billion euros, though the Brits argue it should be less. But to everyone’s surprise, the Brits have already started paying on the installment plan.

So what would that 47.5 billion buy if it weren’t going to Brussels? Well, for starters, Boris Johnson could send a check for 8,637 euros and change to every man, woman and child in England. And let’s face it … Brexit was always about England, not the rest of the UK.

Or, the UK could use the money to pay down its 2 trillion pound debt, which represents about 84 percent of the GDP. Or it could have used the money to offset losses by British business due to leaving the world’s largest trade union. Instead, the money will go to … who knows? … making sure Victor Orbán can keep sucking off Brussel’s teat.

• UK officials are struggling to figure out how fill a shortage of 60,000 heavy goods vehicles drivers due to COVID-19 and Brexit. That shortage is causing goods to sit in warehouses instead of being delivered to store shelves. One solution could be drafting soldiers, many of whom possess HGV licences, according to the Independent.

• The Scots are not going along quietly with Brexit. The Scottish government has just posted “Damaging Legacy of Brexit,” a detailed synopsis of a major research paper done on the damage done by leaving the European Union.

That includes:

  • a dramatic drop in trade to 237.6 billion pounds for the first four months of 2021 from 266.4 billion pounds for the same period in 2018.
  • severe impact on the food and drink sector (whisky is a major export)
  • increased costs for manufacturers attributed to additional red tape and transportation costs
  • a decline in international students and research grants

Scottish officials conclude that Brexit “doing real and lasting damage to agreed and well established governance arrangements”, undermining the Scottish Parliament and giving them renewed impetus to leave the United Kingdom.

You can download a .pdf of the full 18-page research paper here.

• File this under wishful thinking … you have to wonder how the Daily Express can predict for years that Italy is leaving the EU and not lose its credibility? The latest stop-the-presses bulletin came 1 July. Far right Member of Parliament David Jones has a source deep inside the EU who’s telling him EU officials are panicked that Italy will be the next country leave. Any minute now ….

• Ending freedom of movement ended an important connection between the United Kingdom and the rest of Europe – music. Now a group of 200 influential British rockers and rappers are asking the British government to create a fund to offset the additional costs for UK-based musicians to tour Europe, according to the Guardian.

The post quotes legendary Dire Straits guitarist Mark Knopfler as noting that packing up a van and touring Europe used to be a right-of-passage for British groups just starting out. “Without immediate government action to address the bureaucratic barriers put in place since 1 January, a whole generation of musicians will simply not be able to start or continue their touring careers,” Knopfler said. The artists signing on the initiative include Radiohead, Wolf Alice and Kano. On 29 June, Brexit negotiator Lord Frost is due to give evidence to a Digital, Culture, Media and Sports committee of the British parliament on the Johnson government’s failure to negotiate visa-free work for British performing artists.

Think about this: A 2021 version of the Beatles would have a hard time getting out of Liverpool, much less playing Hamburg.

• What we all knew would happened has happened … the round-up of European Union citizens has begun. Earlier in May, British officials started detaining EU citizens entering the UK without work visas. And to make a point about future relations, they held them in “immigration removal centers” before deporting them, according to Politico. The news site reports 30 cases involving German, Greek, Italian, Romanian and Spanish nationals. Which is where the Brexiteers’ crusade to end freedom of movement has been taking us all since 2016. But it just sounds harsh when you think only a few months ago, this never would have happened.

• With a big win in early May, Scotland appears to be headed toward another independence vote. The New York Times has a post about the factors pushing the Scots toward the EU and away from the UK including a visceral dislike of Boris Johnson. If Scotland does a runner, Great Britain would lose eight percent of its population and a third of its landmass. And would probably have to change its name to Mediocre Britain.

• The biggest names in global finance are proceeding with their plans to leave London for the Continent. JPMorganChase – at $3 trillion, the largest American bank ranked by assets – just moved another $200 billion in business to Frankfurt joining Goldman Sachs, Citigroup, UBS Group and Standard Chartered. An EY report estimates about 900 billion pounds ($1.2 trillion) of assets have also shifted to the EU from the U.K., along with about 7,500 employees, according to Bloomberg.

The Troubles are returning to Belfast with a bus hijacked and burned on 7 April, the sixth consecutive night of violence. Crowds attacked journalists at the scene by hardline loyalists angry over pending trade barriers between Northern Ireland, which is still subject to EU trade rules, and the rest of the UK.

Politico has a post that includes an interview with Jonathan Powell, Britain’s chief negotiator who helped hammer out the 1998 Good Friday accord. Powell is quoted as saying Brexit is undermining the delicate balance of divisive interests negotiated all those year ago. Britain’s choice of a “hard” Brexit, followed by EU and Irish government insistence on a trade protocol that keeps Northern Ireland under EU market rules, has ripped open those divisions. The Guardian has a post about the lack of honesty about the impact Brexit would have on Northern Ireland, where the Johnson government knew Brexit would be “felt most acutely … where identity issues are tied up with border issues.”

• More good news for the United Kingdom’s financial sector … Jamie Dimon, head of the largest U.S.-based bank ranked by assets, has a message for Brexiteers: “You blew it.” In an early April newsletter to JPMorgan Chase shareholders, Dimon stated the financial conglomerate might one day move all of its EU-focused business out of London and into Dublin, Amsterdam, Paris or Frankfurt, according to multiple media reports. Not today. Not even tomorrow. But someday soon if Brits can’t right the ship, adding that EU officials will always have the upper hand in future negotiations, DImon wrote.

JPMorgan employs about 19,000 people in the UK including 12,000 in London.

• The United Kingdom is off to a slow start in its pos-Brexit quest to be “Singapore-on-the-Thames,” as Brexiteers phrased it; a now-sovereign, more competitive nation, free to make its own trade treaties. The big get was going to be a post-EU treaty with the United States. Which shows no signs of happening. In fact, Brexit supporter Donald Trump ended up putting tariffs on Scotch Whiskey. Now, his successor, Joe Biden, is leaning on Britain to back off from any punitive taxes or restrictions on big U.S.-based tech companies. As the Guardian noted, “the larger and stronger party makes its demands, and the smaller and weaker party accepts what it must.” It used to be the UK could rely on 27 of its gang to have its back in every international street fight. Not any more.

From that post:

Brexiters were seduced by some imaginary future where Britain and the US would somehow meet on equal terms. The idea the US would put our interests ahead of its own was always fanciful, based on nothing more than a puff of nostalgia for a transatlantic economic relationship that only ever existed in wartime.

• Britain is succeeding wildly in its quest to become not just an island nation, but an isolated island nation. Brexit has ended the 50-year tradition of au pairs, kids coming from France to work as caretakers for middle-and-upper class British families, and British kids doing the same in France. The reciprocal visa arrangement allowed au pairs to work from three to 12 months, their food and lodging provided by host families. There was usually some language studies on both ends of the program. But post-Brexit, no foreign workers can get work visas unless they earn a minimum of 20,480 pounds. Which au pairs don’t. So, as the pro-Brexit Telegraph so eloquently puts it, “au revoir, au pairs.” Instead, Brits are directed to hire people who’ve lost their jobs in the pandemic. Which sort of misses the point ….

• If the goal of Brexit was to banish all the financial giants from London – along with their well-paying jobs – then Brexit already is a huge success. Bloomberg has an eye-opening post, “Seven Charts That Show How Brexit Has Already Changed the City of London,” documenting how Brexit has bolstered the positions of Amsterdam, Paris, Berlin and other European Union financial centers.

A lot of the charts in the post look at arcane aspects of finance such as swaps, which are really insurance policies on deals going bad. But the number of jobs moving out, and the capital leaving The City, is no abstraction.

• We’ve told you what has happened with Brexit, but an interesting thing hasn’t happened that Brexiteers have been predicting since 2016. The now-retired Nigel Farage predicted Great Britain leaving would be only the first of many European Union dominos falling. That immediately after the UK left, other countries would leave – specifically Italy and France. Once they saw how the UK – freed from the tyranny of the world’s largest common market – instantly returned to greatness, the EU would collapse.

That this never happened – not even right-wing leaders such as Hungary’s Victor Orbán have proposed leaving the trade bloc – matters not a wit to the British tabloids still assuring stalwart Brexiteers the EU is breaking up right before their eyes. The Daily Express has a post about Far Right French fringe politician Florian Philippot saying that leaving the EU would be like “leaving prison.” There’s just one problem – Philippot’s party, Les Partriotes, has exactly one seat in the 577-seat French Assemblée National.

If you Google “frexit,” you’ll see the Express has posted no fewer than 23 Frexit stories in the past three weeks … but is the only publication on the planet where editors think there is a story. Meanwhile, legitimate media such as Financial Times are covering how the UK’s exports to Germany have bottomed out, Amsterdam is claiming The City’s financial might and British manufacturers are suffering due to Brexit delays.

Read more here about how the tabloids caused Brexit and pretty much everything else that’s bad including Meghangate.

• This is one of the biggest “we told you sos.” The European Union has firm-by-firm stolen much of the share-trading might of the City of London’s once mighty financial-services hub. As of mid-February, Amsterdam has replaced London as Europe’s main share-trading hub, according to the Financial Times (via Bloomberg.)

Here’s the nut graph from Bloomberg:

The City of London lost its rights to access the single market on Dec. 31 and the EU has not permitted investors inside the bloc to trade shares in companies such as Airbus SE and BNP Paribas SA from the U.K. That saw more than 6 billion euros of daily EU share trading leave London since the start of the year.

This is hardly unexpected as everyone from business leaders to academics to economists warned this was coming. The question is, do the hard-line Brexiteers even care? Clearly, they didn’t and don’t.

Here’s “Bitter, table for one: What it will be like to be British after Brexit,” our eerily prescient take on the glorious restoration of British greatness.

From that post:

The most fervent Brexiteers always say they’re willing to trade the economy for autonomy, and that’s how it’s worked out. Win – win, as the Americans say. Though, it turns out in the global economy, an island nation of only 65 million people – and with no clear competitive advantage in technology or finance – doesn’t have much leverage.

• At the same time London is losing trading volume to Europe, the UK is dueling with the EU on banking rules. This might be one of the battles where the UK is right – Bank of England Gov. Andrew Bailey points out the UK’s standards already are closer to being equivalent to the EU’s than those of Canada, the US, Australia, Hong Kong and Brazil, “countries that have been awarded “equivalence” gold stars by Brussels,” according to the Guardian.

But it still comes back to Brexit – the old scores to settle and the new global rivalries it created.

• Everyone knew Brexit could restart The Troubles in Ireland. Everyone warned that a return to hard borders would be a violation of the Good Friday Agreement of 1998 that’s lead to 20-plus years of peace. And yet those predictions did nothing to stop Brexit, which now separates the Republic of Ireland – part of the European Union and largely Roman Catholic – and Northern Ireland, which is predominantly Protestant and part of the United Kingdom.

The issue is that British officials basically sacrificed Northern Ireland, which remains part of the EU trade bloc … which means goods going between Northern Ireland and the UK have to pass through EU customs, which has led to shortages of goods in Northern Ireland and issues related to supplies of COVID-19 vaccines.

Post-Brexit complications over goods flowing between Northern Ireland and the Republic have led to the Loyalists in the north increasingly angry that they’re cut off from smooth trade with Britain, so Boris Johnson is considering triggering Article 16 of the Northern Ireland Protocol in the Separation Agreement. The EU and the UK both have the right to break the glass and pull the Article 16 switch to reset the Irish border if problems arise.

Those problems everyone warned about back in 2016.

Basically, the UK is asking EU officials to delay full implementation of the Irish protocol until January 2023 on the way to renegotiating the Irish border.

Believe it or not, between investigations into Malin Anderrson’s underwear and Rita Ora’s new mansion, the Daily Mail has the most detailed explanation of this thorny issue.

• The Brexit-supporting Times of London has suddenly awakened to the fact that leaving the EU has put the UK into an existential crisis. In a new post, the Times says a survey it commissioned in England, Northern Ireland, Wales and Scotland indicates “the sense of British identity that once bound the country together is disintegrating.”

Our reply to that is, “Well, Brexit was always about England. But a thousand years of subjugating Wales, Ireland and Scotland hasn’t done much to make the Welsh, Irish and Scots more enthusiastic about the union.”

• In one of the weirder Brexit twists, the Guardian is reporting the UK’s Department of International Trade is advising British companies caught up in the Brexit bureaucracy to move to Europe.

Seriously.

If they set up parallel business registrations in EU countries, they can avoid the new paperwork requirements on British companies who are no longer part of the EU’s single market.

Registering in, say, the Netherlands likely will mean laying off UK staff and replacing them with Dutch employees, according to the post. Which again, we don’t remember Nigel Farage mentioning in his description of a bold new England. One business owner interviewed for the Guardian post noted that ironically, Brexit turns out not to be about winning back control from the EU “but investing in it to survive.”

• Things are no better for British consumers, who are getting big surprises when they order apparel and other goods from EU-based retailers. The BBC has a post about the extra fees tacked on to purchases … fees which are the responsibility of the consumers. One woman, who ordered clothing from an EU-based chain, was shocked when courier company DPD added 58 pounds in customs duties, value-added tax and miscellaneous expenses to her 180 pound order.

Surprise!

• Remember when the United Kingdom was going to become Singapore-on-the-Thames, making trade deals around the world on its own terms? The first was going to be with the United States, whose president in 2016 was a like-minded populist fawned over by Nigel Farage, who called Donald Trump “the bravest man I ever met.” Unfortunately, Trump had a habit of never following through on promises. In fact, in 2019, the Trump Administration imposed a 25-percent tariff on Scotch whisky.

Trump is gone, and President Joe Biden has made it clear that he’s in no hurry to endorse Brexit and alienate the EU through a favorable trade deal. Janet Yellen, Biden’s incoming Treasury secretary, says Biden has made it clear he will not sign any new free trade agreements “before the U.S. makes major investments in American workers and our infrastructure.”

All this was an expensive exercise in futility for the UK. The Scotsman has a new post about how Boris Johnson’s Department of International Trade spent 432,000 pounds with five American law firms for advice on how to get a deal done including a “mini-deal” with Trump before he left office, which never happened. That’s not counting a separate contract worth up to 500,000 pounds for this year. The post quotes Lord Kim Darroch, a former UK ambassador to the US, stating that with the change in administration, the UK will be “lucky” to strike a deal with the US while Biden is in office.

• What was purposely obscured in the earliest days of the Brexit campaign is that being part of a single market with friction-free trade and unrestricted services is what turned the uncompetitive coal-fueled post-World War II UK into Europe’s gleaming financial and tech center. But as John Lichfield at Politico writes in the best post we’ve read on the post-Brexit era, those were invisible benefits. In “A Brexit lesson: EU’s benefits, largely invisible, hurt to lose,” Lichfield writes that invisible benefits “are easy to forget and hard to sell politically. They are also easy to dismiss and easy to lie about. But the cost of abandoning them can be steep.”

British exporters are predicted to suffer 28 billion euros in losses during 2021 alone as a result of decreasing access to EU markets and increasing regulations, delays at border customs controls and tariffs on every industry sector. Which Nigel Farage forgot to mention, but James Dyson clearly foresaw.

As Business Insider noted, at that rate, Brexit will soon cost the UK more than all its payments to the EU for the past 47 years put together.

• The end of free movement somehow caught many Brexiteers unawares and Brexit-enabling tabloids such as the Daily Express and the Sun featured posts about how UNFAIR it is that Brits can’t continue to spend as much time as they like in France, Spain and Portugal. Moreover, the UK has new requirements that expat Brits with non-British partners must earn at least 18,600 pounds per year to return to Blighty … more if they bring children who are not British citizens.

• France is touting how Brexit has been a windfall for its financial sector. The Guardian and even the Express have posts about how Brexit has driven almost 2,500 jobs at financial firms and banks and “at least 170 billion euros in assets” to France.

Ooooops.

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