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"Sufficient Progress" Declared

Devil in the Details

We are headed to round two of trade talks after Theresa May caved in on enough points to satisfy the EU.

First, everyone had to make Northern Ireland happy or it threatened to withdraw support for Theresa May which in turn would collapse the British government.

Here is the Ireland problem: To meet the demands of the EU, there must be borders. To meet the demands of Northern Ireland, there cannot be a border.

What satisfied everyone was circular logic that simultaneously says there will be no hard border between Northern Ireland and Ireland while having a hard border between Northern Ireland and Ireland.

Eurointelligence Explains

What changed the politics was an insertion into the agreement that guarantees the constitutional and economic integrity of the UK.

"In the absence of agreed solutions... the United Kingdom will ensure that no new regulatory barriers develop between Northern Ireland and the rest of the United Kingdom, unless, consistent with the 1998 Agreement, the Northern Ireland Executive and Assembly agree that distinct arrangements are appropriate for Northern Ireland. In all circumstances, the United Kingdom will continue to ensure the same unfettered access for Northern Ireland's businesses to the whole of the United Kingdom internal market."

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I have no idea how that solves any problems and no one else does either because it is logically impossible. However, the statement is cloudy enough to satisfy everyone for the time being.

Eurointelligence continues:

All that's being saying now is: no hard border in Ireland, and no hard border in the Irish Sea. So we are wondering where the hard border that is implied by a customs union/single market will be. The protagonists agreed to answer this question on another day.

The [sufficient progress] news will come us an utter disappointment to two groups. One are the hardline Brexiteers, who had hoped for a big bust-up that would lead to the UK leaving the EU without a deal. And the other group are hardline Remainers, who keep hoping that the whole thing will magically disappear.

The FT calls it an "historic Brexit divorce deal . It is, of course, not the Article 50 agreement, but only an important milestone on the way to a final agreement. The FT notes that the UK won substantive concessions, mostly in respect of the ECJ. But the UK did agree to pay due regard to court rulings on citizens' rights in the treaty. For a period of eight years, British courts will be able to refer cases about citizen's rights to the ECJ.

Will this deal satisfy the Brexiteers? It won't, but they have no majority to force a different outcome. Nor do the hardline Remainers. The pre-arrangement has massively reduced the already low probability of a Brexit-revocation. We are now well on the path to an orderly Brexit.

Everyone but Hard-Liners Happy

For now, everyone is happy except the hard-liners on both sides.

Transition Tactics

There will now be a lengthy transition period in which the UK pays a sizable divorce bill disguised as ongoing payments while the UK is still officially in the EU.

It will be to the EU's advantage to drag the next round of talks out for as long as possible.

Mike "Mish" Shedlock