The UK government should stop doing stupid stuff

Barack Obama famously said “don’t do stupid stuff”. (Actually, he said something even stronger.) This is always good advice. It is particularly good advice for today’s UK. It would be wonderful if it could start doing sensible stuff. But one must keep one’s hopes in check. It should, however, surely be possible to stop doing really stupid stuff.

Brexit itself was stupid stuff. Few people with a serious knowledge of the matter doubt it. It has raised barriers against the country’s closest neighbors and most important trade partners. As the Office for Budget Responsibility noted this month, “The latest evidence suggests that Brexit has had a significant adverse impact on UK trade.” It has reduced overall trade volumes and the number of trading relationships between UK and EU firms. The OBR assumes, quite rationally, that “Brexit will result in the UK’s trade intensity being 15 per cent lower in the long run than if the UK had remained in the EU”. Meanwhile, “Global Britain” has evaporated as hopes of closer trade relations with China and the US have vanished.

While Brexit was stupid stuff, so is the idea that there is a simple way back into a closer relationship with the EU. Renewed membership is inconceivable. This is not only because it would exacerbate the UK’s political civil war. It is also because EU members are too sensible to trust the UK to be an enthusiastic member of the EU as it is and is likely to become. From their point of view, the sight of the UK floundering outside is a helpful lesson on the dangers of exit. As important, Brexit has allowed the EU to progress faster than it would have done in the teeth of habitual UK obstruction.

Most alternatives to full membership — such as joining the single market, the customs union or both — would also restart the Brexit civil war, in both main parties. These options are also self-evidently worse than membership, since they would give obligations without a say in the rules. Moreover, once again, the EU has good reason not to trust the UK: its behavior over the Northern Ireland protocol surely proves that.

Bar chart of Growth in real GDP per head*, 2016 to 2022 (%) showing The UK has been among the growth laggards since Brexit

Trying to alter the main features of the current unhappy relationship is pointless. But that cannot justify making things even worse. It is, for example, a fundamental conservative principle that one only makes change if there is no good alternative to do so. Change is itself costly. So, what possible sense can there be to the “retained EU law bill”, a plan to “review or revoke” up to 4,000 pieces of EU-derived law that form the basis for much of today’s national life? This will simply further increase the uncertainty and costs of doing business.

Sensible businesses do not want to operate under a multiplicity of different regulatory regimes. That was the logic of Margaret Thatcher’s single market project, apparently something Brexiters remain unable to understand. This sort of plan has to make the UK ever less “investable”. The dismal statistics on UK investment do not buy this fear.

Bar chart of Investment share in GDP (%), average 2016 to 2022 showing The UK's investment share in GDP is exceptionally low

What would have been a positively sensible approach for British policy makers to take? It would surely have started from a realistic view of weaknesses and priorities. Consider the difficulty of building on undeveloped land, the failure to make buildings more energy efficient, the persistent regional inequality, the over-centralization of government, the chronically low national savings and investment rates, the failure of pension funds to invest in the productive capital of the country, the failure to build world-scale companies and the longstanding failure to raise skills to a sufficiently high level.

None of this had anything to do with the EU. But all of it had long been “too difficult” to do anything about. So, instead, we have Brexit as a diversionary exercise, culminating in the Liz Truss and Kwasi Kwarteng show, which was as ill-timed and irresponsible as it was intellectually vacuous. That was Brexit as performance art in its purest form.

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I have little hope that this government will do much positive before the next general election, particularly in the midst of an energy and inflation crisis. But it’s not too much to ask it to stop doing stupid things. So, do not consider regulatory changes unless they will clearly be for the better. Do not promise control over migration you cannot deliver. Do not stick to the choice of divergence on food standards, which makes solving the issue of Northern Ireland so intractable. But do try hard to preserve the ability of our scientists to co-operate closely with their European peers. And, not least, do stop the endless barking by the British bulldog.

Tackling big problems may now be impossible. But, even though the government is now in a deep hole, it can at least stop digging it deeper.

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Letters in response to this article:

Ministers would do well to recall Hezza’s red tape quip / From David Wenham, Dartford, Kent, UK

Words more telling than those on the Brexit bus / From John M Jones, London N19, UK

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