In all the hullabaloo about the EU's rejection of the Chequers proposals, one little detail has been forgotten: The Chequers proposals were never going to be part of the Brexit agreement in the first place.

If agreed, they would have been part of the proposals for the future relationship between the EU and UK - as contained in a non-binding "Political Declaration" - to accompany the legally binding Brexit agreement.

The Brexit agreement itself is concerned mainly with the UK's exit payment, the treatment of EU nationals in the UK and UK nationals in the EU, and with the back-stop on the Irish border. According to all parties, that Brexit agreement has been 90% agreed, and the UK even signed up to the EU's outline proposals on the backstop in December 2017.

So the row over the EU rejection of the Chequers proposals (which had already been killed off by internal Tory party opposition before they ever got to Salzburg) is nothing but a red herring to distract attention from her real difficulty with the DUP.

If Theresa May wants to regain the trust of EU negotiators and achieve a Brexit deal, all she has to do is actually deliver on what she promised last December: a legally enforceable backstop which ensures that a hard border will never be required in Ireland.

This document is not a draft treaty, draft A50 settlement agreement(contract), or even another premature "future partnership" (trade) positioning paper. It is a Conservative Party "manifesto" (May's unfortunate term) addressed to party members. More important is explanatory information about customs controls that obviate any need for observing antiquated notions of literal, physical border patrol.

d. The UK and EU would work together on the phased introduction of Facilitated Customs Arrangement that would remove the need for customs checks and controls between the UK and EU as if a combined customs territory. The UK would apply the UK's tariffs and trad policy for goods intended for the UK, and EI's tariffs and trade policy for goods intended for the EU -- becoming operational in stages as both sides complete the necessary preparations. This would enable the UK to control its own tariffs for trade with the rest of the world and ensure business paid the right or no tariff - in the vast majority of cases upfront,and otherwise through a repayment mechanism.

To be charitable, this information does not endorse either "special" EU zoning for NI or dissolution of the UK union. (Nor smuggling --customs evasion-- which most certainly will occur as always.) It endorses port control of goods entering and exiting the both jurisdictions. That is not news or a fantastic breach of UK sovereignty. May acknowledges application to "world" trade customs surveillance and tariff collections.

Buy or Build 'Hi-Tech'
The equipment already exists. Manufacturers already apply RFID, UPC, and EAN scannable ID to variable weight merchandise and livestock. Use of this technology is ubiquitous. Objection to merging commercial and public data sets in order to utilize this technology at ports --whether perfected or not at launch-- is bogus. EU has indicated, comically, it doesn't care as long as UK commits to the A50 agreement.

In Either Case
This document conveys no legal effect on the EU gov. Let's not dramatise--as British and Irish press do-- that it does or that its content is comparable to negotiable terms of any A50 conclusory agreement or that is represents a counter offer.

The conclusion of this story is not complicated.

Diversity is the key to economic and political evolution.

(1) "the EU could legally and logically offer only one of two route: Canada or Norway."

(2) "either the EU gives way on the freedom of movement of people, or the British accept the Irish Sea border." We're not even sure a capitulation on FOM would bring about the desired result (Norway light?). People like Nick Clegg think a 'compromise' on FOM as a good will gesture could stop Brexit in a second referendum. I think that's delusional. As they say: appeasement doesnt work. No one gave a toss about Cameron's deal on FOM, they won't start caring now.

_{Schengen is toast!}

'I am still confident that we can come to an agreement this year and the Chequers proposal is helpful, but it is not the outcome,' Rutte said.
[...]
In Tuesday's budget presentation it emerged the government has set aside an extra €100m to prepare the Netherlands for Brexit. This includes the appointment of 900 new customs officials plus product safety inspectors.

#brexit #cartoon #economist   (_link) pic.twitter.com/LZ9iyD0gxz

— Hugo Cerutti (@HugoCerutti) August 31, 2018

It was sadly appropriate that Denis Norden, the star of the British television show It'll be Alright on the Night, died in the same week as the EU's Salzburg summit took place. The working assumption of many in Britain has been that the Brexit negotiations will ultimately "be all right on the night". The national philosophy of muddling through will prevail once again. After all, national humiliations and catastrophes only happen to people who are unfortunate enough to live on the other side of the Channel.

Salzburg delivered a serious blow to this kind of complacency. It is becoming increasingly clear that the Brexit negotiations could indeed fail. Both the EU and the UK are now talking seriously about the threat of "no deal"- with Britain simply crashing out of the EU in March.

Jeremy Hunt, Britain's foreign secretary, has warned the EU not to misread the situation, by under-estimating Britain's strength of will. But, in reality, it is the UK government that has consistently miscalculated during the Brexit negotiations - by over-estimating the strength of its hand.

If this persists, I fear that Britain is heading towards what counsellors call a "teachable moment", otherwise known as a traumatic experience that forces people (or nations) into a fundamental reassessment.

The UK has experienced similar moments in the postwar period. The failed Suez invasion of 1956 was a mortification that underlined the fact that Britain was no longer an imperial power. Calling in the IMF in 1976 was a humiliating illustration of the UK's economic weakness. A Brexit debacle could lead to another painful moment of realisation, highlighting the practical limitations on British national sovereignty.

I have responded to the article as follows:

Excellent commentary, but also somewhat naive. In reality the EU position (no less than the British) is constantly evolving, and Brexit is an excellent opportunity to lay down some lines in the sand - to discourage any others - and to fortify what might have been some shifting sands in the past.

It's not purely about power, it's also about self-preservation, and here the EU has as much to lose as the UK. Brexit provides a wonderful opportunity to show unprecedented unity of purpose, at a time when there is much for the EU to be dis-united about. It provides a wonderful illustration of the benefits of membership, at a time when some recalcitrant members may be tempted to threaten to leave.

After the UK's experience, it will be a very long time before any member, however unhappy, will be tempted to trigger A.50. It's like shooting yourself in the foot, when your original problem was but in your big toe. Greece may still be feeling humiliated by it's treatment by the EU, but it will have nothing on the humiliation felt by the UK by the time the EU is finished with it.

Gideon must of course express some sympathy for the UK's complaints of Commission "inflexibility", but it is in reality nothing more than the rigorousness required of an institution set up by Treaty by 28 Sovereign states and which requires a consensus by 27 to proceed. Do the British really want to be held hostage to a referendum in Ireland required to change some aspect of the Single market or Customs Union to which they themselves signed up as a member?

The amateurishness of the UK government's approach defies belief and almost guaranties an catastrophic outcome. The EU simply has no one competent to negotiate with and hasn't had to depart from its opening positions. Suez mark II is a kind description.

'Disabused' makes sense, perhaps your intention?

Excellent diary, as per.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

EU warns UK again to recoup €2.7 billion China fraud bill

The European Commission today warned the U.K. for the second time to recover €2.7 billion in lost EU revenue stemming from the country's failure to stop a massive fraud network that allowed cheap Chinese goods to flood into Europe.

The Commission's warning is the next stage in the bloc's formal infringement procedure and follows up on findings from the EU's anti-fraud office OLAF that British customs played a central role by repeatedly ignoring warnings to take action over Chinese textiles and footwear entering the EU at a fraction of their cost of production.

In response to a question from POLITICO on board an RAF Voyager plane on her way to New York, the prime minister said she would be able to maintain frictionless trade and strike "good, improved trade deals" with countries around the rest of the world.

"Just think about this: If having those EU regulations stopped good trade deals, how come the EU has done trade deals with countries around the rest of the world?" May said.

David Henig, a former U.K. trade official who was involved in U.S.-EU trade negotiations, agreed that a shared rulebook with the EU could cause problems for the U.S. trade deal, although it may not be terminal.

"The U.S. agriculture people need to be able to export, they insist on their standards for export," he said.

Nick Allen, chief executive of the British Meat Processors Association, said the U.K. has particularly high animal welfare standards and very prescriptive hygiene standards, and anything that means they have to compete with lower standards is a problem for them.

Nevertheless, Trade Secretary Liam Fox has repeatedly insisted "there will be no lowering of U.K. food standards" in future trade deals.

Place Jo Cox has been inaugurated to the melancholic chords of a Balkan folk song and the anti-apartheid hymn Nkosi Sikelel' iAfrika as Brussels honoured the murdered MP in a ceremony attended by her family and the Labour leader, Jeremy Corbyn.

The small corner of Brussels backing on to the Ancienne Belgique, a venue frequently visited by Cox during her six years living in the city, was packed with local dignitaries and politicians who had come to remember and watch as the new name plaque was unveiled.

Cox's sister, Kim Leadbeater, addressing the crowd in the square, said she could still hear her sibling's "immortal words" on deciding to be an MP: "It won't affect your lives at all."

Her sister's death at the hands of a far-right terrorist a few days before the 2016 EU referendum was still impossible to comprehend, Leadbeater said.

Word has reached us that the EU is now firming up its opposition to Chequers in such a way that we see little chance of retreat. Michael Barnier and his team have commissioned a report that suggests the long-term costs of Chequers to the EU would exceed the short-term costs of a hard Brexit.

It is possible that the two sides still reach a deal? For one, events might intrude. The UK might have a new government before Brexit - unlikely but possible. The mood in the UK population might turn against Brexit in a way that has not happened yet. EU member states may change their position once they acknowledge the reality of a hard Brexit which they have not yet. Also, Barnier's calculations are based on the result of an economic model - the kind of which always overestimated the impact of the single market in the past - against actual losses of income and jobs. We keep noting reports, in the German media in particular, about a second referendum. A hard Brexit would come as a total shock.