Sean Rickard - Independent Economic Analysis

Much to my surprise after three weeks of campaigning opinion polls suggest a hardening in the Labour vote.   In part at least because the campaign has revealed Theresa May to be less resolute and confident.   As readers of this blog will know I do not share the popular view regarding Mrs May’s leadership skills and negotiating qualities.   And the evidence is clear to see in her ‘dementia tax’ debacle – and by all accounts the fiasco lies squarely with her.   One would have thought that after the budget humiliation of being forced within days to abandon an increase in national insurance for the self-employed, lessons would have been learned.   But political judgement was again lacking in the failure to appreciate how toxic her proposals for social care would be amongst the electorate.   Mrs May’s then compounded her blunder by attempting to deny the position set out in her presidential manifesto and ignominiously retreating.   Is this what we can expect when it comes to the Brexit negotiations?   If, as Jeremy Paxman suggest, she might now be viewed as a ‘blowhard who retreats at the first sign of gunfire’ she has only herself to blame.  


Her lack of judgement, visible in her attempt to concentrate all Brexit decisions in her hands before the Supreme Court stepped in, is also evident in her contemptuous election campaign.   After repeatedly insisting she would not call an early election she has now declared – despite securing Parliament’s overwhelming approval for triggering Article 50 – she needs an enlarged majority.   As the government already has a mandate to commence negotiations what Mrs May is actually seeking is a very personal mandate: in essence her campaign comes down to saying she, and she alone, is deserving to be prime minister.   This arrogance is manifested by the focus of her campaign.   Rather than treating the electorate with respect by setting out thoughtful and costed policies on social, economic and foreign issues she has relied on monstering Jeremy Corbyn.   But to date all she has achieved is to reveal herself as a ‘wobbly’ leader who is responsible for a poor campaign.  


It may be true that a stronger opposition leader would have been more effective in bringing greater ridicule to bear on her social care retreat.   But Jeremy Corbyn is doing better than many, including myself though possible.   After the opprobrium that has been heaped on him over the past year, by his own MPs as well as the media, perhaps he could only go up in the polls.   Indeed, Mrs May’s presidential campaign has served to invite the electorate to take a closer look at her character.   Those who are still thinking about who to vote for will have seen, for example in her interview with Andrew Neil, a women seemly incapable of answering a straight question and who looks uneasy under scrutiny.   In short, Mrs May is where she is, not because of superior political skills, but because of guile, the absence of competition from within her own party and a second rate leader of the opposition.


One consequence of Mrs May’s attempt to make this a presidential election is the downgrading of any serious discussion regarding the economy.   The manifesto’s vagueness in key areas such as workforce skills, infrastructure and industrial strategy, is insulting —business support is taken for granted.   Her insistence on maintaining her unachievable targets for net immigration is not only disingenuous but would only exacerbate the negative effects of Brexit for the economy.   Like UKip, whose policies the government now embraces, Theresa May’s seems more intent on a populist message than addressing the mounting challenges for businesses.   Her constant reiteration of the ‘no deal is better than a bad deal’ mantra is threatening for businesses.   Economic chaos would follow the UK crashing out of the EU without a trade agreement; an outcome implicitly confirmed by our leader.   How else should one interpret Mrs May’s unceasing refrain that without her ‘strong and stable’ leadership the Brexit negotiations will end in failure with dire consequences for the economy.   A point echoed by her Health Secretary who stated that a bad deal on Brexit would be a ‘disaster’ for the NHS.   Neither the Prime Minister nor Jeremy Hunt are willing to specify what a bad deal would involve.   In fact a bad deal would be ‘no deal’ ie, resort to WTO trade tariffs with the EU.  


It may accord with the behaviour of a blowhard to treat voters with contempt but I fear the real reason why Mrs May’s manifesto is devoid of costings is that the economic prospects for the UK are diminished by Brexit.   Whatever deal is eventually secured it will lie somewhere between the status quo and chaos.   Our supine media seem happy to go along with this audacity while simultaneously insisting on detail costs from Labour.   Not only should costing be demanded but also an explanation should be sought as to how they would fare following a ‘no deal’ Brexit.   A transparent manifesto would admit that the only deal that might be secured by the end of 2018 would be a humiliating EEA type transitional arrangement.   The sheer volume and complexity of the negotiations rules out any chance of a final agreement by the end of next year.   The FT has revealed that the UK stands to lose 759 separate agreements with 160 countries on the day it withdraws from the EU.   These will need to be renegotiated and replaced after Brexit just to maintain the status quo.   Many are of huge importance to the UK eg, nuclear deals for vital material used in cancer treatments; aviation deals to allow UK planes to fly around the world.   What Mrs May is going to discover after her pyrrhic victory on June 8th is that the vast majority who voted to leave the EU did not do so because they believed being poorer was a price worth paying for reduced immigration.   Mrs May is about to experience the winners curse


T H E  W I N N E R ’ S  C U R S E ?


30th May 2017


Sean Rickard Ltd