The Guardian editorial yesterday was a masterful piece setting out the sheer recklessness of Johnson and his plans to burden industry with a mountain of new bureaucracy while companies struggle to manage the ongoing fallout from Covid-19 and in the middle of a deep recession. It is indeed highly irresponsible. Not only would it be so if the plans had been announced years ago but it is unforgivable that with less than five months to go we still don't have all the details of how things are supposed to work or the necessary IT systems up and running.
It is totally insane and all built on faith and ideology.
The Guardian also had another article on the same day anticipating ONS figures being released this Wednesday forecasting the UK economy shrank by 21% in the second quarter to June. This is a stunning figure and confirms we are indeed in a deep recession.
The UK, according to The Guardian, is about to suffer the deepest GDP drop of any G7 country, France being the next worst with a 13.8% drop. Germany is said to be 10.1%, less than half of ours.
Garry Young, deputy director of the National Institute of Economic and Social Research, is quoted saying it could take Britain longer to regain its pre-pandemic growth trajectory than hoped. The think tank estimates that GDP will not return to the level recorded at the end of 2019 until the second half of 2023. This is four years of lost growth.
In the midst of it, the government is proposing to spring on British businesses the biggest change in our trading relationship with our biggest trading partner that we have seen for two generations - and more than that, do it overnight. I think other nations must be looking at us with incredulity.
When we look back on 2020 in years to come people will shake their heads at what apparently intelligent men are doing to an advanced economy.
And we are not even in the realms of leaving without a deal. Even if we get a deal there will still be a mountain of new bureaucracy.
In spite of what we can all see, Briefings for Brexit has an article still claiming it is all scaremongering with Reuters firmly in their sights. The author, Catherine McBride, says Reuters' headline about trade "collapsing overnight" is plain wrong. I think we all know what Reuters mean and I think we shall see a huge drop in trade - and over a very short period.
Ms McBride says:
"The idea that trade or financial ties between the EU and the UK would ‘collapse overnight’ without an agreement is not something you would expect to read in the financial media. Trade agreements do not generate trade – consumer demand and business suppliers do."
She is an economist - presumably a pupil of Patrick Minford - who seems to think companies and consumers only ever consider the price of goods and nothing else. They do not. Availability is much more important than price and in many cases quality, design and reliability are also much higher.
If a supplier sees more difficulty and less profit in an activity they would re-evaluate whether they wanted or could continue. Nissan is a good case in point. Customers on both sides of the Channel are already looking at how their supply chains might need to change to avoid unnecessary bureaucracy, delays or extra costs.
Having been a salesman I know how these things work. If you lost business to a European competitor you would be now speaking to those former customers and asking if they want to risk disruption at the end of the year. Sowing doubts or raising problems about your competitors is part and parcel of selling. This will be happening already and as more details emerge of the new forms to be filled in and extra costs added, it will only increase.
From my own reading I am certain that most companies who trade with Europe do not understand what is about to hit them and think that a trade deal will avoid all the added paperwork. It will not.
The Guardian says:
"The government’s new border operating plans, unveiled last month by Michael Gove, were criticised by freight operators for lacking detail and relying on as-yet untested technology. Much will depend on the successful functioning of “track and trace” style technology to obviate the need for long queues and checks at borders. The “smart freight” system is not expected to be ready for testing before November, ahead of a January launch."
I think we all know it will not be ready and working in time and we will have to plead for a humiliating delay or risk chaos. Whoever thought when they went into the polling booth on 23 June 2016 that the government would be asking pharmaceutical companies to stockpile drugs in readiness preparations?
I think we all know it will not be ready and working in time and we will have to plead for a humiliating delay or risk chaos. Whoever thought when they went into the polling booth on 23 June 2016 that the government would be asking pharmaceutical companies to stockpile drugs in readiness preparations?
It is all utterly barmy.
