Cocky Johnson faces dilemmas

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Boris Johnson Pic: Arno Mikkor

Britain finally left the EU at 11pm on 31 January, signalling the ease with which Boris Johnson can now get his way in parliament following the Tories’ big election win.

Johnson was thwarted in his attempt to secure a special Big Ben bong to mark the occasion. However, his government has big ambitions. Johnson wants to shift the political landscape of Britain.

He sees being hard on immigration and law and order as key, leavened with gestures towards “rebalancing” London and the regions.

It would be mistake to underestimate the impact of his hold on parliament and the honeymoon this will allow him.

But he does face difficulties not least in securing the kind of trade deal with the EU he would like.

Johnson seeks an “ambitious free trade agreement”, but one that will allow Britain to diverge from EU rules. What is more, he wants “fast-track” negotiations to deliver this by the end of the year.

He has little chance of meeting these objectives. The issue will be what trade-offs he is prepared to make and the extent to which this alienates sections of business.

Johnson also hopes to negotiate a trade deal with the US. This will be challenging and may prove destabilising.

Anything from allowing Huawei to construct part of Britain’s 5G communications system or refusing to let in imports of US chlorinated chicken could trip him up.

The Trump administration has shown remarkable consistency in its willingness to use trade tools and tariffs to pursue its objectives.

The Tories appeared confident ahead of EU negotiations beginning in March, but they went into discussions on withdrawal with the same kind of confidence and assumptions that they would be able to divide EU member states. They did no such thing.

In the end, Johnson “got Brexit done” only by adopting most of what May had agreed and betraying promises to the Loyalist DUP.

There is an element of Johnson seeking to repeat the “trick” of appearing to be serious about preparing for no deal while being prepared to do whatever it takes to secure agreement.

For its part, the EU has emphasised the unity of member states, its desire to do a deal but the difficulty of acting speedily and insistence that Britain not be allowed to duck EU regulations.

It would be a mistake to rule out Johnson securing a deal of sorts, especially one limited to goods, if he is prepared to give enough away. The call by outgoing Bank of England governor Mark Carney for no compromise with the EU on financial services (ie the City of London) marked a striking departure from previous warnings against divergence from the EU.

Whether Johnson can conclude a deal by November, which he needs to do to avoid seeking to extend the transition, is another matter. The Financial Times warned the decision to rule out extending talks “means any agreement is likely to be minimal, rushed and last-minute”.

He faces other dilemmas. The kind of big infrastructure projects he appears to like, such as HS2 or Heathrow expansion (which he has previously opposed), threaten to become running sores and bottomless black holes for the government.
Even the relatively small act of rescuing regional airline Flybe in January drew howls of protest and threats of legal action from major airline bosses.

The shake-up of Whitehall promised by Johnson’s senior aide Dominic Cummings may prove accident prone. It triggered a report in January of “infuriated cabinet ministers”, which in turn led to a crackdown on Cabinet leaks and threats to axe ministers in February.

The government is meanwhile pursuing yet another spending review, with ministers ordered to identify cuts of at least 5 percent across departments.

It leaves Johnson with a lot of circles to square. In the circumstances, the warning of Financial Times columnist Robert Shrimsley is worth noting: “Already the hard questions are crowding in… As the decisions get harder, Johnson and his attack dogs will see the benefits of identity politics and cultural warfare… The temptation to draw sharp lines will be powerful.”

We can expect this government to be thoroughly nasty.