The last days of Mrs May

Yesterday more authority drained away from the Prime Minister. By the time she got to her Statement of her revised offer on the Withdrawal Treaty the Conservative benches were much more than half empty. Those of us who stayed explained again why we opposed her draft Treaty. The front bench contained mainly her hard core pro EU supporters, Philip Hammond, David Liddington, Amber Rudd, Greg Clark, Rory Stewart and James Brokenshire. It was a fitting visual backdrop for a Statement which failed to appeal to new votes in a Commons which has already voted it down on three separate occasions.

I gave the PM the opportunity to say something to Leave supporters around the country, explaining again to Mrs May that many who voted Leave do not regard the Withdrawal Treaty as leaving. It binds us into EU rules, payments and the rest for a further 21 to 45 months with no guaranteed clean way out at the end of that period.She had nothing to say to us. She repeated the mantra that her Agreement was leaving without tackling the strong hostility to it in the country and the obvious facts that it locks us back into making big payments, accepting all their laws and allowing freedom of movement for many more months.

I find it curious that the Cabinet has not yet moved to explain to the PM that she cannot continue. A number of the Cabinet want to run for Leader, and some are actively running proto campaigns for the role of PM. They should first remove Mrs May. It is against the spirit of decent conduct to be campaigning to replace her whilst in cabinet saying they support her and her policies. It may also make it much more difficult for any of them to win, as their first leadership task is to show they know how to secure the exit of the PM they wish to replace. By evening we got word that at last one member of the Cabinet resigned because she could not go along with the Withdrawal Treaty Bill after all.Still we are not allowed to see the Bill, so worried is the government about it.

If Mrs May somehow manages to struggle on into June and puts her Withdrawal Agreement Bill to the vote, those who vote for it will demonstrate they do not understand the mood of the nation or the nature of task of rebuilding support for the government.

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179 states trade successfully with the EU with no customs union or single market membership

I am grateful to facts4eu for reminding us of this important truth. You do not have to bind yourself to the EU to trade with the EU. Our industries already have mixed supply chains with components and raw materials from non EU countries getting just fine as well EU product.

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The loss of Conservative leaders

My years in the Conservative party have seen several leaders destroy themselves politically through a fanatical commitment to the EU. The odd thing is they have adopted this stance when it has annoyed many members of the party and evoked strong opposition from some Conservative MPs. Worse it has done considerable damage to the country and its economy, leading to a loss of confidence by voters generally.

John Major destroyed his leadership by insisting on crippling the UK economy by putting us into the European Exchange rate mechanism. The resulting boom bust undermined the Conservative reputation for economic competence and put the partty out of office for 23 years.

William Hague refused to take us out of the pro federal EU grouping of the EPP which annoyed supporters and added to his tribulations. His slogan of in Europe but not run by it was not convincing as it was not backed by a policy to get powers back. He won back just one seat in 2001 after the disastrous result in 1997.

David Cameron argued on the wrong side in the referendum and lost, destroying his Premiership. He could have stayed neutral or backed Leave and led us out in good order after the result. I never understood why he thought Remain would win or why he let them run such a nasty and negative campaign.

Mrs May appointed advisers who clearly wanted to recreate many of the features of our membership of the EU despite the vote to Leave. Her obstinate commitment to an unacceptable lock back in Treaty which the public has decisively rejected has led to the breakdown of her authority. Cabinet members campaigning to become leader need to now create the vacancy they crave by telling her she cannot continue. She will be the third PM victim of trusting the EU too much in ways which lose the trust of the UK people.

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Mrs May’s latest presentation of the Withdrawal (Delay in leaving) Treaty

Not a word or comma of the Treaty has been changed. The PM has long given up on any idea of renegotiating the Withdrawal Agreement. As it remains the same Agreement I trust Parliament will give the same answer, and vote it down. I will certainly continue to oppose it. Better still would be to get Mrs May to resign now. If her only policy is an Agreement the public and Parliament have roundly rejected, it is difficult to see the point of her staying in office.

Today she says she will table a bill and allow Parliament to amend it over the customs union, single market, second referendum and the rest. Most of these things would need negotiation with the EU and fall later in the process if and when the Withdrawal Treaty is approved. It would be a deeply damaging way of negotiating our future with the EU, having made far too many concessions in the Withdrawal Treaty.

The suggestion that Parliament could legislate for a second referendum is a particularly damaging idea. Up to this point Mrs May has always opposed this with many good reasons to do with our democracy and the promises all made prior to the Peoples vote on the EU in 2016. I assume many more Conservative MPs will now join in voting against should this proposed legislation be brought back to the Commons.

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A short Committee meeting with a big consequence

Sir William Cash, I and others opposed the delay to our exit from the EU when the government embarked on it. We complained about the way the government agreed to the delay on the terms offered by the European Council and rushed it through in UK law by a Statutory Instrument that was not even debated. Yesterday, after much delay and argument, the government allowed Sir William a ninety minute debate in a committee where there was a secure opposition and government majority to approve the Statutory Instrument  anyway. I am grateful to him for securing this debate and for submitting an important legal case about the way the government pushed through delay to our exit.

Many of us attended the Committee though we had not been included as members of it because we wished to put the case against delay, and to support Sir William’s legal case concerning the imperfections of the Statutory Instrument which in his view made it void. In the Commons any MP can attend and speak at a committee, though only those made members of the committee can vote.  Time did not permit speeches from  most of those wishing  to speak, though a series of lively interventions made sure the case for  exit did not go unheard. I was allowed a couple of minutes at the end of the proceedings.

I said that it was sad day for Parliament when something of this magnitude fell to be debated in a small committee over just 90 minutes, As it entails the spending of additional £7bn or more on EU contributions, and submits us for many more months to EU laws and requirements, it should be debated by the whole House and voted on by every MP. I drew attention to the growing gap between many members of the public and Parliament over   honouring  the referendum decision. Many voters believe MPs  should  keep their pledges from the 2017 General Election when both Conservative and Labour promised to get us out of the EU by 29 March 2019 in accordance with the laws Parliament passed and the wording of the EU Treaty. I explained why our democracy needs us just to get on with it, to leave. When we voted to renounce the EU Treaty we did not vote to lock ourselves into two new Treaties.

The conventional media decided to ignore these heated and important exchanges between pro Brexit MPs and the combined ranks of the Conservative and Labour establishments. Labour simply failed to speak up for leaving and would not oppose the government.

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The reign of experts and the “post democratic”age

I like good experts. Modern science and technology has delivered some great advances which improve our lives. If I fell ill I would of course consult a doctor and seek expertise.

The problem is the present  age is cursed with some experts  especially in economics and government who keep getting it wrong yet they still expect the rest of us to accept their verdicts however damaging or daft they may be.

Lord Mandelson summmed up the direction of travel when he talked about transition to a post democratic age. Modern governments try to give away their powers and responsibilities  to international and national so called independent  bodies full of alleged experts. They seek to prevent elected governments changing things by locking future governments into the system by binding International treaties. For years our budgets and economic policy were first dictated by the European Exchange Rate Mechanism and then by the Maastricht debt and deficit requirements.Our energy policy is governed by Climate Change Treaties.

Some people want us to be democratic so they oppose locking ourselves into the rules and decisions of national and  international bodies in principle. Other people would not mind if those bodies made wise decisions and did well, but understandably get cross when they lead us to disaster.

The truth is you cannot say you live in a democracy if crucial parts of government are under independent expert control with no democratic accountability. In practice in a democracy like the UK Parliament and government are held responsible for big decisions even if they are taken by so called independent experts. In a later post  I will look again at how the Bank of England is not in fact independent and how wrong it has been on major issues of economic and financial policy over my adult lifetime. It is crucial that fallible expertise is subject to criticism and influence  by elected officials and can be overturned if necessary by the votes of the people. The EU has threatened this important part of our democratic settlement with its rigid legal structure. Those in the Eurozone suffer even more  from its defects.


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Our aim should be helping people out of poverty and into better paid jobs

One of the main arguments between socialists and conservatives is over the main aim of economic  policy. Conservatives want to raise living standards, to help people be better off. Socialists usually want to lower or remove inequality.

These two varying aims require different policy responses and achieve different results. Of course all sensible socialists would also want higher living standards, and all democratic conservatives agree the  tax and benefit  system should remove some of the inequalities market economies generate. Nonetheless deciding based around a primary  aim of betterment for the many or a primary aim of cutting inequality produces different results.

Mr Osborne adopted more of the socialist preoccupation in his budgets, worrying about measures of inequality more than about sluggish rises in average real incomes. He worked out how to administer a bigger tax hit to the wealthy and how to get rich people out of the country or to stay out of the country. One of the easiest ways to cut inequality is to offshore the richest people by having a hostile tax regime towards them. This may then reduce investment and job creation for everyone else as these people live and invest in a more friendly climate elsewhere. Both France and Italy are now wooing the rich with a better tax deal for that reason.

A test of which motivation predominates in a policy maker is that of the Laffer curve. If a Chancellor insists on imposing a tax at a rate that reduces the tax take, we can assume he does so to create more equality at the cost of less income and lower living standards. The decision of Mr Hammond and Mr Osborne to levy Stamp duties that cut the revenue must be based on this, and their  persistence with a 45% higher rate of income tax which also lowers revenue.

I want a policy based on a more rapid reduction in low incomes and no incomes. That requires a policy  which allows entrepreneurs, footballers and great entertainers to keep more of their earnings  so they stay here and pay tax here. They then also buy more things here, invest more here and employ more people here. Jealousy is a nasty emotion, and not a good policy. It makes us all worse off, with less money to spend on public services. As you achieve more growth you can then also lower tax rates on the rest of us, where lowering the rate cuts the revenue for any given level of economic output.

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Treasure Island have posted today a useful guide to the continuing huge trade surplus in goods the EU continues to run with the UK. Since the referendum vote they tell us the EU has earned itself a wonderful £250bn trade surplus, so no wonder they want to try to lock us in to their trading terms and laws  to keep it going.  It is a reminder of how good a negotiating position the UK failed to use during the talks on our exit, and is worth a look on their site.

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Good prices and plenty of choice

Whilst shopping on Saturday I was struck again by the huge range of choice of products, the good displays and by some of the keen prices on offer on the High Street.

I saw a Potato masher made of good strong stainless steel with a pleasant wood handle for just £3.99. Assuming a 50% only mark up by the retailer that means it was bought for just £2.67 from the manufacturer, including all packaging and shipping costs. Maybe the mark up was higher and the item cost just £2 delivered half way round the world. It had come from China by ship and truck. What UK manufacturer could match that cost?

Or take a well made and strong pair of kitchen scissors for £5.99. They came with plastic handles over the steel, good cutting edges, and all encased in a rigid see through plastic pack for ease of getting home. They may well have cost the shop between £3 and £4.

There is plenty of manufacturing capacity in the world for everything from clothes to housewares, offering a great array of different styles, colours and specifications. The excess capacity in China and elsewhere means strong downward pressures on the prices of many goods. The family budgets are under pressure thanks to the cost of government – Income Tax, Council Tax, VAT, fuel tax, car park charges, vehicle and broadcast licences, rail fares and the rest – and the increases in prices of various services with a higher labour content.

Consumers are spending relatively more on services and less on goods. As real wages rise so people can afford a few more luxury or discretionary items, with basics taking less of the budget. The new Wokingham Town Centre has a higher ratio of restaurants, coffee bars, specialist food bars and cocktail parlours, reflecting the wish of shoppers to afford an experience as well as simply buying more goods. The digital pound is also surging, with more being spent on mobile phones and tablets, on film downloads, on internet papers and magazines and various specialist apps.

The public sector needs to get smarter at adapting modern technology so it too can be more flexible in the services it offers and keener in their costing or pricing. The USA is pushing back on China to stop it dominating in tec as well as consumer goods, and to protect their data and networks.

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Where is the Withdrawal Treaty Bill?

Will Mrs May really ask us to vote for a fourth time on this unpopular Treaty by bringing forward the Bill to ratify it? She says they will. Why then does she  not publish it so we can talk about it properly? Is it so bad it must be kept secret?

Mrs May’s refusal to change her mind on this draft Treaty means she must resign after so many defeats for it.

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  • About John Redwood

    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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