His paper is interesting. He says we need to “focus on domestic policy levers to boost our competitiveness” and argues that Brexit has given us “increased room for policy manoeuvre.” Yet he devotes not a single word to suggesting what policy levers he would use or how that increased room for manoeuvre will help. This is eight years on. Eight long years in which he has had plenty of time to think about it but still can't list a single lever to pull.
All 13 pages of the paper are spent re-running the old arguments, defending his position, trying to debunk reality and rejecting the position of the great majority of respected economists who think Brexit has been, and will continue to be, damaging. It is the con man reassuring the mark.
Lyons throws in the usual straw men, claiming that suggestions of an "immediate economic collapse" never came to fruition. Who said that? I've read, watched and listened to an awful lot of Brexit debate over the last nine years and I don’t remember anybody on either side saying Brexit would lead to an “immediate economic collapse.” It certainly led to a collapse in the pound, from which it has never fully recovered.
He fails to mention the Brexiteers who claimed it would bring an immediate economic resurgence. Patrick Minford said we would get a GDP boost of 6.8%. Digby Jones said not a single job would be lost. Rees-Mogg talked about reduced costs of food and footware.
Perhaps he is silent on these matters because he was one of them. In April 2016, in a piece for The Standard, he suggested “with Brexit, people would suddenly face cheaper prices for food, as we would be paying world prices.” Suddenly? Really?
He also says that he warned us “innumerable times before the referendum” that Brexit “would be an economic shock.” His Standard article obviously slipped through the filter since it contains no warnings or caveats of any sort. It was prosperity all the way.
At least he now admits there has been an economic impact, "even if overstated." Lyons says he framed it as Brexit being like a ‘Nike swoosh’ and that "after the initial shock, the benefits would accrue over time with sensible policy decisions." Well either we haven't had enough time or enough sensible policy decisions, or perhaps both.
Lyons now says limited alignment with EU rules is OK provided we don’t rejoin the single market or the customs union and we should make "maximum use of the competencies that have returned to Westminster" and "though this need not necessarily rule out dynamic alignment in a few sectors, we need to focus on the domestic policy levers that can be pulled in Britain to boost our competitiveness."
This is, of course, Labour’s current position but it's unsustainable and I suspect it will change over time.
The strategy might make sense if Britain only chooses to align in food products with an SPS agreement, although it would only really be of value if this was dynamic with Britain simply following EU rules set by Brussels but in a strictly legal way as opposed to voluntarily. It means a role for the ECJ and the UK becoming a rule-taker.
The problem here is twofold. Firstly, an important principle has been conceded and secondly, flowing from that, a lot of other industries would also like to align with EU rules to ease border delays and costs. The chemicals industry is a case in point. It is both sensible and logical.
We may end up following rather a lot of EU rules over which we have little to no influence and certainly no vote or veto, in order to gain some slight potential advantage in other areas like finance or AI. But this supposes Britain is significantly better at drafting regulations than the EU27 for which there is no evidence at all..
In fact, UK civil servants have consistently been accused of 'gold-plating' EU directives where Brussels produces rules that national governments translate into domestic law themselves, as opposed to regulations which have a direct effect.
So, if anything there is evidence that we are least qualified to make sensible policy decisions to boost competitiveness.
In another five or ten years, I wouldn't be surprised to see Lyons et al producing articles where they will claim they always knew Brexit was a bad idea and argued strongly against it
