The insecurity of a new no-deal Brexit Prime Minister

The economic consequences of the UK leaving the European Union without a deal have received significant attention, but a no-deal Brexit would also have important security implications. Helena Farrand Carrapico, Jocelyn Mawdsley and Richard G. Whitman explain what leaving the EU without a deal might mean for the UK’s internal and external security, as well as the country’s future security relationship with the EU.

The Conservative leadership race seems to be increasing the likelihood of a no deal Brexit. Both Boris Johnson and Jeremy Hunt have made clear they are willing to contemplate a no deal Brexit on 31 October if a revised agreement cannot be reached with the EU on the terms of the UK’s withdrawal. And the EU’s member states have made clear that they are unwilling to renegotiate the Withdrawal Agreement reached with Theresa May’s Government.

The likely impacts of a no deal Brexit on the EU-UK economic relationship have been given significant attention with hair raising accounts of the probable effects on trade, borders, travel and UK manufacturing and services. However, the effects on the security interrelationship between the EU and the UK have been given much less prominence. Currently, as a member state, the UK is connected to the other EU member states through a variety of cooperation arrangements for internal security (on borders, policing and criminal justice) and external security (managing security threats from outside Europe and which include cooperation on conflict management and defence). A no deal Brexit means that this cooperation would be thrown into uncertainty.

Internal security

A no deal Brexit would have considerable impact on the UK’s internal security, in particular on police and judicial authorities’ capacity to address issues such as organised crime and terrorism, and on the UK’s role as a leading country in the area of security, including its ability to propose new instruments and shape EU decisions so as to align them with its national interests. In fact, one could even go as far as to say that a no deal Brexit constitutes a substantial threat to UK security given the current critical and unprecedented levels of organised crime activities, as well as the continued severe level of international and domestic terrorism.

Against a background of wide-ranging police cuts (namely the loss of 44,000 police officer jobs since 2010) and the accumulation of austerity effects, the rapidly growing levels of insecurity are having a clear impact on the everyday safety of the UK population, with serious and organised crime currently endangering more lives than any other national security threat. Given that these problems are transnational in nature, the key to addressing them lies on intelligence and information exchange, rather than on the reinforcement of borders as has been occasionally expressed.

The UK currently has access to a large number of EU instruments, databases and agencies that allow it to have direct access to crucial information, to exchange best practices and to coordinate strategies and operations with other EU member states. The most important instruments include, for instance, the European Arrest Warrant, the Schengen Information System, the European Criminal Record System, Europol and Eurojust, whose access is part of a carefully designed relationship that the UK has negotiated with the EU since the early 90s and which has allowed it to adopt a selective participation in the area of internal security.

Within this model, the UK has been able to take part in instruments that are aligned with its national interests, at the same time as it has been allowed to opt out from others it considers less useful (for a complete list of UK opt-ins and opt-outs from this area, please visit the UK Governments’ dedicated website). As the UK progressed through the negotiation of the Withdrawal Agreement, its future security negotiation position also became clearer: it wishes to find alternatives to EU instruments that are capable of maintaining the same level of cooperation, in particular regarding data-driven law enforcement, practical assistance to operations, and multilateral cooperation through agencies.

A no deal scenario creates considerable uncertainty regarding the future UK-EU relationship as it implies a sudden loss of access to data and EU instruments, an abrupt interruption in cooperation, a hard border between Northern Ireland and the Republic of Ireland, and a decrease in the levels of trust between the two sides.

Defence and security

As far as external security and defence consequences go, the immediate consequences of a no deal Brexit are less serious than the internal security ones. This is because the UK has already retreated from an active role in the EU’s Common Security and Defence Policy (CSDP) in preparation for Brexit, for example handing over the operational command of Operation Atalanta (that deals with the piracy threat in the Horn of Africa) and leaving the roster of EU Battlegroups (standby military forces that the EU keeps available for conflict management). Most military operational activity now is either bilateral with other member states or through NATO.

Helicopter refuelling at sea as part of Operation Atalanta, Credit: European Union Naval Force Somalia Operation Atalanta (CC BY-NC-ND 2.0)

However, anticipating Brexit the other EU member states have set an ambitious agenda for EU defence policy and with the UK having little say in its objectives. There are now well-advanced plans to develop more shared military research and development, defence industry collaboration and common defence procurement. All of these are for the purpose of giving the EU a greater military capability to act independently of other countries such as the U.S.

The foreign and trade policy consequences of a no deal Brexit have significant knock-on consequences for defence too. As far as trade policy is concerned, a no deal Brexit will have negative consequences for British manufacturing, including the space, aerospace and defence industries. Delays and additional costs to exports may endanger British firms’ participation in major international supply chains. This coupled with a significant gap between UK defence policy commitments and budgetary allocations makes the UK a less desirable and reliable partner for future multinational procurement projects as the FCAS developments have shown.

Indeed, the recklessness of a no deal Brexit, after three years of political turmoil, would send a bad signal to the UK’s partners about its reliability in security and defence matters. Already there seems to have been a cooling off of UK-French defence cooperation because of French concerns about UK reliability both in operational participation and defence industry cooperation.

Brussels re-set

A no deal Brexit has broader foreign and security policy consequences for the UK’s relationship with the EU. The UK’s internal security relationship with the EU’s member states would be thrown into significant uncertainly and with dislocating effects for the policing, information sharing and judicial cooperation relationships that are currently in place.

Even without a no deal Brexit EU member states have already created a blueprint for further security and defence integration that do not anticipate a significant role for the UK as a non-member state. The agenda for close and special partnership, provided for under the current Withdrawal Agreement and the Political Declaration, would be in tatters. And the UK would be seen as unreliable partner unable and unwilling to deliver on security and defence cooperation.

A new EU leadership coming into office and coinciding with an October no deal Brexit may have no lived experience of the extensive contribution that the UK made to existing EU security and defence policies and capabilities. Their formative impression of the UK could be as a security challenge to be managed rather than an indispensable partner for security cooperation.

This article gives the views of the authors, not the position of LSE Brexit or the London School of Economics. It first appeared on our sister site EUROPP – European Politics and Policy.

Helena Farrand Carrapico is an Associate Professor in Criminology and International Relations at Northumbria University. She is on Twitter @hcarrapico

Jocelyn Mawdsley is a Senior Lecturer in European Politics at Newcastle University. She is on Twitter @JocelynMawdsley

Richard G. Whitman is Professor of Politics and International Relations at the University of Kent. He is on Twitter @RGWhitman

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Boris Johnson’s real agenda: The ‘Singapore scenario’

While immediate political attention has focussed on urgent questions of how, when or if Britain’s new Prime Minister, Boris Johnson, will succeed in taking the UK out of the EU, the longer-term agenda of a Johnson-led Conservative administration has been pushed into the background. This is unfortunate. Johnson’s dream, should his premiership survive, is of a post-Brexit Britain akin to a European ‘Singapore of the West’, writes Charles Woolfson (Linköping University). He cautions, however, that this ‘Singapore scenario’ leaves a lot to be desired.

In Johnson’s eyes and those of fellow ardent free-marketeers, a ‘Singapore scenario’ would be achieved by an ultra-business-friendly environment with low or zero corporation tax, low wages, weak trade unions, vestigial welfare provisions and a significant temporary migrant ‘non-citizen’ workforce (around 30 per cent of the total workforce), largely without the protection of national labour laws or access to welfare provisions.

Yet, as the Prime Minister of Singapore pointed out, the transposition of a Singaporean model to the UK is not so simple. Currently, the UK government spending on the public sector accounts for 40 to 45 per cent of the GDP, while for the Singaporean government it accounts for a mere 16 to 17 per cent of the GDP (Bloomberg News, 2018). Furthermore, the Singaporean economy, while ranking second in the World Bank index of 190 countries in terms of ‘ease of doing business’ (pro-business regulation), is also accompanied by powerful regulatory social controls and an extensive system of government patronage (Trading Economics, 2019). Social inequalities in Singapore are rising. A recent review of 157 countries in terms of commitment to reducing inequalities ranked Singapore overall at 149, among the 10 worst performers, and at 157 in terms of redistributive progressivity of tax policies (Development Finance International and Oxfam Report, 2018). Noting a decline in ranking since the previous year, the report concludes, ‘On labour, it (Singapore) has no equal pay or non-discrimination laws for women; its laws on both rape and sexual harassment are inadequate; and there is no minimum wage, except for cleaners and security guards’. As a prescription for a post-Brexit labour market, a ‘Singapore scenario’ leaves a lot to be desired.

None of this has dampened enthusiasm for turning Britain, free of European regulation, into some kind utopian free-market paradise. Johnson’s trademark rhetoric has consistently excoriated the EU for ‘trussing the nations together in a gigantic and ever-tightening cat’s cradle of red tape’. It was exemplified by Johnson’s theatrical appearance before the cheering Conservative Party faithful on the final leadership election hustings. Brandishing of all things, a kipper, Johnson claimed (incorrectly, as it happens) that ‘Brussels bureaucrats’ required that each kipper sent through the mail be accompanied by a coolant bag, an unnecessary and ludicrous burden on business.

There are echoes in Johnson’s buffoonery with the 1980s satirical BBC TV series, ‘Yes, Minister’. A 1984 Christmas special edition depicted an incompetent and opportunistic James Hacker as Minister heading the Department of Administrative Affairs, reluctant to sign a Xmas card to a Brussels Commissioner (one rather French-sounding ‘Maureece’ by name). In contention was a proposed Brussels directive to standardize the ‘EuroSausage’ and re-designate the ‘Great British Sausage’ as an unappetising ‘emulsified high-fat offal tube’. In the same election hustings speech, Johnson proclaimed, kipper to hand, ‘And when we come out, therefore, we will not only be able to take back control of our regulatory framework and end this damaging regulatory overkill but we will also be able to do things to boost Britain’s economy, which leads the world in so many sectors’ (New Statesman, 2019).

Hostility to EU regulation is merely a surrogate target for hostility to regulation in general, seen as holding back burgeoning British free enterprise. To realise full ‘regulatory divergence’ from EU controls (the glittering prize of a no-deal Brexit), Johnson has now proposed the creation of free economic zones or free ports, offering lower import taxes and customs tariffs, favourable manufacturing locations, and looser regulation to lure investment in up to 10 ports around the country. These free ports will be situated mainly in declining and ‘left-behind’ areas such as Teeside. Such zones are not specifically precluded by EU regulations, although it is true to say that they are regarded by the Commission as potential havens for counterfeiting goods and money laundering. In fact, over 80 exist within the EU, the majority in the newer member states of Eastern Europe. Besides providing free-enterprise zones where capitalism can be let loose to do what it does best, their attractiveness for employers is that they are typically insulated from employment protection and minimum wage legislation, while collective bargaining and trade union representation are generally non-existent. Free ports are ‘the Singapore scenario made real’ in the UK context. They will be the forward positions in a greater national project of wholesale deregulation accompanied by comprehensive labour subordination, UK-apore as one big free port.

The post-Brexit foreign trade and investment environment

Ironic, therefore, is the announcement by Brexit-supporting Sir James Dyson, one of Britain’s most celebrated entrepreneurs of the relocation of his corporate headquarters from England to Singapore. This comes only a few months after a previously announced ongoing UK investment programme, much welcomed by Theresa May, and portrayed as a sign of business confidence in Britain’s post-Brexit future. For Dyson, the business logic is presumably compelling. While preserving his UK sites, the company already has manufacturing and new R&D facilities in Singapore, in part following a previous relocation from the UK. The Singapore investment is proximate to profitable East Asian markets for his luxury products, not to mention providing a suitable base for Dyson’s new plan to develop electrical automotives. Not least, however, the move to Singapore potentially offers zero corporation tax. A further incentive is access to labour markets in the East Asia region providing both compliant and relatively cheap human resources when compared to the UK. Dyson Ltd presents a paradigmatic example of ‘foot-loose’ capital investment shopping for regulatory regime advantage in a globalised ‘race to the bottom’. As a pointer to the investment potential of a post-Brexit Britain, Dyson’s decision is ominous.

An additional dimension to the post-Brexit competitive challenges facing the UK economy is the fate of existing foreign direct investment. Japan, for example, is a significant investor in the UK. Nissan, Toyota, and Hitachi between them account for 40 billion pounds (nearly half of Japanese direct investment intended for the EU in 2015 and 144,000 UK manufacturing jobs. Japanese business has sought reassurances that the UK will remain in the European customs union and single market, a demand that is profound anathema to Johnson.

In or out of the single market and customs union, the fact is that the EU is itself remoulding the global trade and investment environment through an extensive series of Economic Partnership Agreements (EPAs), several of which it was hoped would be with potential trading partners for the new ‘Global Britain’. Recent among these is the EU-Japan Economic Partnership Agreement (EPA) of 2017. This will remove nearly all significant tariff barriers to trade. While the UK has already one of the least regulated labour markets in the EU, such agreements place further competitive pressure on a post-Brexit UK to show even greater ‘flexibility’ on labour and other standards. It is pressure to downgrade that will surely intensify as the UK government embarks on the mammoth task of ‘replicating’ forty years of existing European trade deals or tries its unskilled hand at forging new ones. If preliminary exchanges with the US regarding food safety standards in a future trade deal (specifically, the acceptability of chlorine-washed chicken) are anything to go by, the prospects are not enticing.

Labour migration: an unresolved contradiction

Theresa May’s successful wooing of Nissan investment in Sunderland may prove to have been only a temporary demonstration of foreign investor confidence in the future of the UK economy. As the Japan Ministry of Foreign Affairs warned, ‘Japanese businesses rely on inexpensive labour from Eastern Europe in the manufacturing and agricultural industries in the UK’.

Labour migration, the toxic driver of the Brexit debate, will present unique challenges to a free-market Johnson government, not least as its internal logic would suggest a more liberal and open regime. Migration, therefore, presents an unresolved contradiction at the heart of the ‘UK-apore’ project. To appease his core supporters it is more than likely that Johnson’s government will be forced, reluctantly or otherwise, to replicate much of the exclusionary path towards continued free movement of labour that informed the policies of his predecessor.

As Central-Eastern European migrants return home, (or refuse to come to the UK for the wages and conditions on offer) both of which increasingly they appear to be doing, UK nationals will need to be ‘persuaded’ to accept those low-paid ‘3D’ (dirty, dangerous, and demeaning) jobs that they had previously rejected. The ‘Singapore scenario’ applied to the UK would mandate a downgrading of current welfare and labour standards in a massive recalibration of labour expectations of the domestic labour force. Such a recalibration would be achieved by a radical shrinking of what remains of the welfare state, combined with a raft of ‘incentives’ to accept whatever jobs are on offer.

Questions of the downside of globalisation are not new but much accentuated by Britain’s current precarious political and economic conjuncture as it departs from the EU. In short, Boris Johnson’s ‘UK-apore’ can only be realised in a ‘race to the bottom’ to the significant detriment of existing standards. If the business model of labour and welfare devaluation in a ‘Singapore scenario’ is the pathway towards Britain’s economic salvation, then such standards now become integral to the democratic politics of post-Brexit Britain.

This post represents the views of the author and not those of the Brexit blog, nor the LSE. Image by David RussoSome rights reserved.

Charles Woolfson is Professor emeritus of Labour Studies at the Institute for Research on Migration, Ethnicity and Society (REMESO), Linköping University, Sweden. Since arriving in Sweden in 2009 after a decade of residency in the Baltic states, he has written on East-West migration from the newer EU member states, and on the impacts of radical austerity programmes in the Baltics following the crash of 2008. He co-edited with Jeffrey Sommers, The Contradictions of Austerity: The Socio-Economic Costs of the Neoliberal Baltic Model, Routledge, 2014.

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Long read | It’s the English, stupid! Brexit is an expression of English nationalism

It’s the English, stupid! Hudson Meadwell (McGill University) writes that the national structure of the UK and Britain, and the political organisation and expression of that structure, are keys to understanding Brexit.

Brexit is an English-centric phenomenon in which Northern Ireland, Scotland and Wales appear as complications or afterthoughts. The sole constitutional voices in the Brexit process are English-dominated, first in the referendum itself, which aggregated the vote across national jurisdictions and in Parliament. Neither Northern Ireland, nor Scotland nor Wales are constitutionally empowered to express a voice on the matter of EU membership.

However, English political dominance is not something which can be directly acknowledged in political discourse. The language used by Donald Cameron and Theresa May in their letters, eighteenth months apart, to the President of the European Council, Donald Tusk, shows some of the political equivocations that result. Cameron’s letter opens under the heading, “A New Settlement for the United Kingdom” and then twice refers to the ‘British people’. May opens her letter with reference to the ‘people of the United Kingdom’ and then presents the referendum as a ‘vote to restore, as we see it, our national self-determination’. These brief quotations should show just how slippery these signifiers are. The United Kingdom includes Northern Ireland but Northern Ireland is not British. Indeed, the notion of the ‘United Kingdom’ was repurposed in the 1920s in order to recognize the reality of Irish partition. May never refers to the British people but she does invoke national self-determination. Later, she again makes reference to the ‘people of the United Kingdom’ But to which nation is she referring; whose self-determination is she signifying? Is this just loose, sloppy language?

These kinds of ambiguities and equivocations in expression, in important documents written both to your negotiating adversary as well for a larger political audience, are revealing and call out for some diagnosis. Perhaps the political unconscious is slipping out. Or are we looking at strategically ambiguous political rhetoric embedded in plans, the elements of which are not self-evident in these documents? These are hard questions, in any case, particularly so here, when there is relatively little material, primary or secondary, to work with.

So, how to proceed? I’ll advance a conjecture related to nationalism. If anything can be taken for granted and thus draw some of its force from its unarticulated everydayness and be articulated and enacted in a political plan, it’s nationalism. Nationalism, as some of its theorists suggest, can be both banal and a self-conscious political project. That’s not a contradiction, it is a measure of the sources of nationalism’s social and political force.[1]

Hence the conjecture: Brexit is an expression of nationalism. Between Cameron and May in their letters, the latter is much more explicit, as she tried to invoke the legitimating power of national self-determination. But which nationalism? Who is more likely going to slip into the mentality that confuses their nation with ‘Britain’ or the United Kingdom?

This is a nationalist conceit but whose? It’s not the Scots, nor is it the Irish, or the Welsh. It’s the English.[2]That’s fully compatible with the recurring theme of English exceptionalism in British history, which takes English dominance (if not superiority) as a natural birthright.[3] After all, who incorporated who?

That birthright has been challenged at different historical points, and each challenge marks an important political crisis. English identity has proven fairly resilient but each crisis has left its mark. English dominance is not as natural a birthright as it used to be.

Irish resistance and eventually revolution still casts a long shadow in the form of Irish partition, even if England retained its dominant position in what is now known as the United Kingdom. In hindsight, partition perhaps bought England some (considerable) time but it looks now like that particular colonial legacy has come home to roost. Northern Ireland, drawing indirect and direct support from the EU and Ireland, and despite the support the Democratic Unionist Party has provided the Conservatives in Westminster, is now limiting England’s political degrees of freedom, much to the chagrin of Brexiteers.

Scotland is no longer particularly tractable and successfully induced the English to concede an elected assembly and, not long after, a first referendum on independence. This may be more a running problem than a crisis, if you prefer your crises to be episodic; nonetheless, the Scottish question will be part of the calculations of the Conservative government in their negotiations, up to and after the run-up to October 31, of a Labour government in the event of an electoral defeat of the Conservatives, at some point, whether post-Conservative transition or post-withdrawal and, naturally, of the SNP. There is no resolution of the Scottish question in sight.

Then there are the cumulative long-run effects of the rise of American power culminating in its post-1945 hegemony, the loss of blue-sea colonies, and more recently, the incremental deepening and enlargement of the EEC/EU after British entry. All of this changed the international standing of Britain and the UK and their imperial core – England.

English dominance thus is vulnerable: There are standing internal challenges to the borders of the political shells it maintains, and membership in the EU threatens its ability to control these interior spaces through the British parliament. These challenges can work in tandem as well as separately. ‘Scotland in Europe’ captures dramatically the instrumental relationship between Scotland’s national aspirations and EU institutions. Both the EU and Ireland have tangible stakes in Northern Ireland.

England has seen off various challenges to its dominance but its day of reckoning does seem to be drawing closer. It’s now much harder to separate challenges and deal with them as one-offs.

However, imperial cores don’t often reform themselves in the aftermath of empire. The current imbroglio does not look like the expression of a politically-healthy ruling class. There is no appetite for reform in the English ruling class. It’s a little like watching for regime change in autocratic contexts, looking for signs of a crack in the regime and the emergence of challengers to its hardliners. But there is not much sign of this in the party system, at least not yet.

The Conservative Party appears now all in for withdrawal, although it has been debating different scenarios. However, some of these scenarios are contrived. The Conservative party does not hold many cards, now that an agreement has been negotiated and ratified by one of the two parties in the negotiation.

On the other side of the House, the main political alternative – Labour – has been, at best, ambivalent about EU membership in the run-up to Brexit and afterwards. We can’t really say that Brexit has polarized the two major parties until relatively recently, as its leader pledged to support Remain in the event of a new referendum. Yet this was a rather half-hearted, rather than fully-voiced position. It likely will be overwhelmed by internal party division.

Labour is led by a longtime MP and activist who came to political maturity in pre-Thatcher Britain in a period in which (‘old’) Labour had not fully cast off its dream of ‘socialism in one country’. Membership in the EEC/EU, and the long march of English and British political history may not have put fully paid to that dream (even a weaker version of it) in Labour. Hence, withdrawal could be seen as an opportunity to return to roads not taken. That is also quite consistent with the general argument on the left that the EU is a neo-liberal dead end. So, the narrow national vision that underpins the Conservative position is not completely alien to Labour. If something like this is the choice on offer – if these are the two little Englands on offer – unification for the Irish and separation for Scotland may look more attractive.

This brings me back to where I started: the language of the letters written to Donald Tusk by Cameron and May. Perhaps, then, it is the political unconscious speaking in those letters even if the most recent challenge to English political dominance that continued EU membership represented has provoked a nationalism that is anything but banal.

No doubt, like his predecessors, the new Prime Minister will take the opportunity to write, whether to the President of the European Council or the President of the European Commission. Whatever is being said privately between the two negotiating parties, we can expect such a letter to be written partially for a domestic audience and hence to be made public.

How will he put it? In such a letter, will Johnson repeat in different words, his first public communication after being named Conservative leader, and invoke ‘the awesome foursome that are incarnated in that red white and blue flag who together are so much more than the sum of their parts’?

Part of this is generic, boilerplate nationalism, ‘rally around the flag’ rhetoric. Yet most of it is distinctively English nationalism – the denial of challenges to English dominance which an acknowledgement of national disunity would represent, coupled with an appeal to the unbroken coherence of the United Kingdom (the ‘awesome foursome’), all of which studiously skirts political reality.

This post represents the views of the author and not those of the Brexit blog, nor the LSE.

Hudson Meadwell is Associate Professor of Political Science at McGill University. Image © Copyright Richard Croft and licensed for reuse under this Creative Commons Licence.

[1] Michael Billig, Banal Nationalism (Thousand Oaks, CA.: Sage, 1995); Michael Skey and Marco Antonisch (eds.), Everyday Nationhood. Theorizing Culture, Identity and Belonging After Banal Nationalism (London: Palgrave Macmillian, 2017), Political Geography. Special Issue, Banal Nationalism 20 Years On. 54 (September, 2016).

[2] Krishan Kumar, The Making of English National Identity. Englishness and Britishness in Comparative and Historical Perspectives (Cambridge: Cambridge University Press, 2003) and Michael Skey, National Belonging and Everyday Life (Palgrave Macmillan: Basingstoke, 2011).

[3] Tom Nairn, The Enchanted Glass. Britain and Its Monarchy (London: Verso, 2011, rev. ed), Leah Greenfeld, Nationalism. Five Roads to Modernity, (Cambridge, MASS.: Harvard University Press, 1992), chapter 1, Linda Colley, Britons: Forging the Nation, 1707-1837 (New Haven, CT.: Yale University, 2009, rev. ed.)

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No-deal Cabinet: time for another Bank of England stress test

With the new Cabinet made up of ‘Vote Leave veterans and right-wing free marketers’, Costas Milas discusses how the Bank of England may want to respond.

Evan Esar quipped in his Comic Dictionary that statistics is ‘the only science that enables different experts using the same figures to draw different conclusions’. This definitely applies to the notorious Brexit divorce bill figure of £39bn. Brexiteers believe that they can avoid paying the bill and extract a ‘better’ deal from our EU partners. Others interpret the above figure quite differently: it is a financial commitment that the UK has to fulfil.

Boris Johnson started his premiership with reference to this divorce bill. It is quite astonishing that his first speech as Prime Minister hinted that the UK stands ready to ignore its financial commitments in the case of no-deal Brexit. How reassuring can it be in the country’s ongoing efforts to sign trade agreements with the rest of the world when the Prime Minister declares he is ready to ignore existing international financial commitments? The £39bn bill nonetheless accounts for approximately 0.27% of the EU annual GDP (based on 2018 data) – it is not as big as Mr Johnson makes it seem. Assuming a 31 October 2019 exit date, the bill will have gone down (based on the latest estimates by the Office for Budgetary Responsibility) to £32.8bn.

Mr Johnson’s choice of cabinet ministers attracted, to a great extent, negative comments from the press. For instance, The Guardian noted that the new Cabinet is made up of ‘Vote Leave veterans and right-wing free marketers’. A definite worry about this combination is that many Cabinet ministers do not see no-deal Brexit as a problem for the economy and the country as a whole. Sure, the UK economy will eventually absorb the negative shock; that said, two important questions need immediate answers. First, why would the UK want to inflict on itself huge (short to medium term) economic pain when it can definitely avoid it by either agreeing to a version of Theresa May’s deal or by negotiating a further short-term extension which would then lead to another (but again not that different) Brexit deal?

Second, what is the exact size of the economic pain in case of a no-deal Brexit? The latest Bank of England Financial Stability Report points out that the 2018 stress test of the UK banking sector was sufficiently severe to deal with a disorderly Brexit. The assumptions of the test involved, among others, a 4.7% fall in gross domestic product, a 27% drop in the sterling effective exchange rate and a rise in the bank rate to 4% (presumably to defend our currency and stave off inflationary pressures). Nevertheless, recent comments by Bank of England policymakers, including Gertjan Vlieghe, suggest the very possibility of a near-zero interest rate in case of a no-deal Brexit.

Consequently, it makes sense for the Bank of England to assess the implications for our economy of a bank rate cut to zero rather than a rise to 4%. Would, for instance, the banking sector be able to absorb a potentially huge drop in bank deposits as customers will be looking for alternative returns outside a sinking (at least in the short term) UK economy? This question needs to be answered before Mr Johnson presses the no-deal Brexit ‘button’.

This post represents the views of the author and not those of the LSE Brexit blog, nor the LSE. It first appeared on LSE British Politics and PolicyFeatured image credit: “Boris” by Raymond Wang is licensed under CC BY-NC-ND 4.0.

Costas Milas is Professor of Finance at the University of Liverpool.

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Is Boris Johnson’s Brexit posturing just a power play?

phil syrpisBoris Johnson said the chances of no deal were ‘a million to one’. His government is also actively preparing for it. Phil Syrpis (University of Bristol) argues that the new PM’s true intention is likely to be to hold a general election as soon as possible.

The new Prime Minister, Boris Johnson, has promised that the UK will leave the EU by October 31. His stated aim is to renegotiate the Withdrawal Agreement. Should that be impossible, he promises that we will be ready to leave without a deal on that iconic date. He has assembled a Cabinet, and a team of close advisors who include Dominic Cummings and Matthew Elliott – both, like Johnson and Michael Gove, leading figures in Vote Leave – who support these aims, and who are determined and optimistic that they will be able to achieve them. We will, do or die, they say, realise Brexit.

johnson

Boris Johnson arrives at No 10 on 24 July 2019. Photo: Number 10 via a CC-BY-NC-ND 2.0 licence

It is of course possible that Boris Johnson is true to his word, and succeeds in delivering Brexit on or before October 31. This piece – which builds on a Twitter thread I wrote on July 25 – suggests that the reality may be different. It assumes that Boris Johnson’s principal motivation is not Brexit, but power. It suggests his aim is not to achieve Brexit by October 31, but rather to establish a narrative to enable him to win a pre-Brexit general election. Were he to win an overall majority he would be able, in the new political context, to reconsider his Brexit options. In this reading, the determined pursuit of Brexit – and in particular of a no-deal Brexit – is not the end, but merely a means to the end.

The problems with the stated aim

To begin with, there is very little chance that the renegotiation with the EU will be successful. The European Council decision of 11 April 2019 extending the Article 50 period, in its paragraph 12, expressly excludes any reopening of the Withdrawal Agreement. There is no sign of a ‘solution’ to the Irish border conundrum. And there has never, to my mind, been a convincing explanation as to why a ‘credible threat’ of no deal, forecast to cause significantly more damage to the UK than to the EU, will result in new ‘concessions’ from the EU, whose overriding interest is – and will remain – the protection of the integrity of the single market. It looks as though the renegotiation may be over very soon. It is not difficult to hear the beginnings of a case being made against the intransigent, inflexible, undemocratic, European Union.

And next, the path towards ‘no deal’ by October 31 is by no means smooth. This is for three linked sets of reasons. First, it is likely that there will be strong opposition within the Conservative Party, and within Parliament, to any move towards a no-deal Brexit. Given that his majority looks likely to be cut to 2 after this week’s by-election, Johnson can ill afford any internal opposition. And although the opposition to Johnson is divided, it is united in the desire to avoid no deal (though MPs have missed more than one opportunity to ‘take no deal off the table’). It is far from certain that PM Johnson would survive a vote of no confidence if his renegotiation fails, and he begins to actively pursue no deal.

Second, the delivery of any no-deal Brexit is difficult. We are, both legally and economically, as reports this week from the CBI and the Institute for Government illustrate, categorically not ‘no deal’ Brexit-ready. As the government’s preparedness notices amply illustrate, much of what is needed to ‘manage’ no deal relies on the passage of legislation – and hence Parliamentary support on which Johnson would be unwise to rely – and on coordination with the EU, whose likely first ask will be… a guarantee relating to the divorce bill, citizens’ rights, and the Irish border.

And third, any no-deal Brexit necessarily involves making the abstract Brexit, which won 52% support in the referendum of 2016, into something concrete. Almost inevitably, this reification of Brexit will alienate some of its erstwhile supporters. It has become almost axiomatic that proponents of Brexit fail not just to deliver it, but also to define it: Vote Leave was a deliberately broad church, Theresa May treated us to months of ‘Brexit means Brexit’, and even now, urgent questions about what a no-deal Brexit might entail remain stubbornly unanswered.

The case for a pre-Brexit general election

This all goes to show that leaving the EU by October 31 is likely to be very difficult, both from a political and a practical perspective. It may be that Johnson’s strategy is not to deliver no deal, but instead – having been thwarted first by an intransigent EU, and then by a remainer Parliament (Jacob Rees-Mogg is just the man to ensure that Parliamentary proceedings are presented in a suitably arcane and labyrinthine way) – to be forced to call a general election, in which he can position himself as the champion of the UK and the champion of the people.

If this is indeed his strategy, it is not without risk. But he is in a difficult position, and none of his options are risk-free. Given the timetable, it is likely that he would require an extension to Article 50; something which Johnson has said that he will not countenance. But if MPs conspire to make it impossible for him to deliver no deal – for example if a handful of Tory MPs refuse to support him, or if a majority of MPs supports a vote of no confidence against his leadership – he may credibly be able to say that his hand has been forced. Were an extension request to be made in October, it is of course possible that the EU will reject it, but it is more likely that they would be prepared to grant an extension in order to enable a ‘democratic event’, such as a general election, which provides a (perhaps slim) prospect of unlocking the impasse in the UK, to occur.

The greatest risk for Johnson is of course that he may not win a majority in a pre-Brexit general election. He is vulnerable on the one side from Nigel Farage’s Brexit Party, and on the other, from Labour, the Liberal Democrats, the Greens and the Nationalist parties. Nonetheless, he has reasons to feel optimistic. His pitch – that he is fighting the election in order to stand up to the twin evils of the EU and the remain establishment and achieve a mandate to (finally) deliver Brexit – will mirror that of the Brexit Party. If the Brexit Party continues to poll strongly, he may be able to consider some form of electoral pact with Nigel Farage. If he is feeling confident, he may instead choose to take him on. He also has grounds to suspect that the remain-leaning opposition parties will be divided. Relations between Labour, the Liberal Democrats and the Scottish Nationalists are strained. There is, in addition, no coherent message emerging from the various disparate factions. Some want to deliver a better Brexit; some hope for a people’s vote; only a few are prepared to make the call to revoke Article 50. He has assembled a team which seems well equipped to exploit his opponents’ weaknesses, and to fight – and win – an election. Given the divisions in the opposition, a 30-35% vote share is likely to afford him a majority in the House of Commons.

If he wins, he acquires the ability to reconsider his Brexit options. The problems associated with Brexit will remain the same, but the political context will be much changed. He will, at that stage, be in a position to reveal, or perhaps to begin to formulate, his true intentions. He is brazen enough to resile from inconvenient promises. He may opt for no deal or he may, for example, opt for leaving on the basis of the current withdrawal agreement, with a Northern Ireland-only backstop, aiming to secure a free trade agreement between GB and the EU. He will be guided by the possibilities which the new Parliament creates for him. His desire will be to move beyond Brexit, and – for better or worse – to deliver his vision for the UK.

This account may of course be wrong. Johnson may genuinely do all he can to deliver Brexit by October 31. He may succeed. If he fails, this may become his ‘Plan B’. And it may play rather better for him than a successful ‘Plan A’.

This post represents the views of the author and not those of the Brexit blog, nor LSE.

Phil Syrpis is Professor of EU Law at the University of Bristol Law School.

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Prime Minister Johnson has appointed a no-deal Cabinet

After Parliament successfully ended May’s hopes of securing her version of Brexit, Britain now has a new Prime Minister and a new government, all with less than 95 days to go until the UK is due to leave the European Union. Prime Minister Boris Johnson’s Cabinet reshuffle has been characterised as brutal, but what does the new Cabinet mean for the UK’s departure from the European Union? The PM has appointed a no-deal Cabinet, says Thomas Eason (University of Nottingham).

Looking first at the Prime Minister himself, Johnson has said that he wants the UK to leave the EU with a newly negotiated Withdrawal Agreement. However, if a new deal cannot be obtained, his preference is for the UK to leave the EU without a deal on 31 October 2019. Unfortunately for Johnson, the prospects of negotiating a new deal are slim. Not long after he took office the EU quickly stated that it would not renegotiate the Withdrawal Agreement. Johnson’s preference for a newly negotiated deal is, therefore, a unicorn – it is promised but cannot be achieved. This leaves him with 3 credible options. He can try to get May’s deal through Parliament again, he can cancel Brexit and keep the UK in the EU, or he can opt for no-deal. His rhetoric clearly suggests the latter is his preference, and so too do some of his key Cabinet appointments.

Starting first with the appointment of the Brexit Secretary, Stephen Barclay, one could be mistaken for thinking continuity is Johnson’s plan. Barclay served as Brexit secretary under Thresa May, making him one of the few secretaries of state not to be purged from the Cabinet. However, while serving under May, he did not have altogether that much power over the Brexit process. This was because the Prime Minister chose to handle many of the negotiations herself. Indeed, Barclay’s input seemed to be limited to managing no-deal preparations. These have since been handed over to Michael Gove, thus begging the question, what will Barclay be doing as Brexit Secretary now? Well, The Department for Exiting the European Union’s website claims that the department is responsible for overseeing Brexit negotiations, and it is very likely that the machinery of the department is doing just that. As before, Barclay’s role in negotiations will ultimately depend upon how active the Prime Minister chooses to be, but his control over the department will ensure that his voice is heard by both his colleagues around the Cabinet table and the EU, and his position seems to be the same as Johnson’s. Barclay believes that if a new deal cannot be reached, crashing out of the EU under no-deal is the next best option. Since we know the EU is unwilling to renegotiate the Withdrawal Agreement, no-deal is apparently the Brexit Secretary’s first choice.

Next then is Michael Gove. Gove has been appointed Chancellor of the Duchy of Lancaster, an obscure post that many have been forced to look up. As suggested above, he has been given control of the Cabinet Office and no-deal preparations. The Cabinet Office is responsible for coordinating government policy across departments, and since a no-deal Brexit would impact all areas of government policy, giving it control over no-deal preparations is probably a wise move. Ultimately then no-deal preparations are Gove’s responsibility, and since taking up his new position Gove has claimed that no-deal is now “assumed” by the government. Gove himself was famously one of the key faces of Vote Leave, meaning few can question his commitment to leaving the EU.

Taking the job of Secretary of State for International Trade in Liz Truss. In this role, Truss will be responsible for promoting British trade and securing new trade deals around the globe, a key part of the discursively constructed “Global Britain” image. When it comes to Brexit, Truss is one of those MPs that had a sharp change of opinion. During the referendum, Truss voted Remain. However, she has since become a very staunch Brexiter, claiming that if a deal cannot be secured, leaving the EU without a deal is the preferable option. Based on her current discourse then, Truss is another government voice speaking in favour of a no-deal Brexit.

That said, while many in the new government now promote a no-deal Brexit, few have done so as strongly as Dominic Raab, the new Foreign Secretary and de-facto Deputy Prime Minister. Like the others, Raab has repeatedly argued that if a new deal cannot be made, which the EU suggests it cannot, then no-deal is the best option. Indeed, he has even suggested that he would be willing to prorogue Parliament to ensure MPs cannot prevent no-deal from happening. The responsibilities for negotiating the Brexit and new trade deals may well fall under the control of other departments, but the role of foreign secretary is still important to the Brexit process. As Foreign Secretary, Raab will be seen as a spokesman for the British government by both domestic and international audiences, and thus any statements that he makes about Brexit will be heard around the globe. Furthermore, in conducting Britain’s diplomatic relations, the Foreign Office itself will be playing a crucial part in the process of creating new trade deals. Together, this all makes Raab a key player in the Brexit process and his preference is for no-deal secured through prorogation if necessary.

These extreme views are shared by Jacob Rees-Mogg, the new Leader of the House of Commons, whom will also be attending Cabinet. In this role, Mogg will be responsible for controlling government time in the House of Commons, and thus (alongside the Chief Whip) will be tasked with getting any new deal through Parliament. More importantly, he will also be responsible for blocking any attempts by MPs to prevent a no-deal Brexit. Over the years Mogg has made his views very clear. He believes that a no-deal Brexit is preferable to May’s Withdrawal Agreement and that the Government should prorogue Parliament to secure a no-deal if it needs to. Like Raab then, Mogg supports no-deal Brexit and the prorogation of Parliament to get there.

Lastly, there is Sajid Javid. As Chancellor, Javid will be crucial to ensuring economic stability in the event of a no-deal, and Johnson has reportedly ordered Javid to ensure Gove has all of the resources necessary to prepare for a no-deal Brexit. Like Truss, Javid is another MP that voted for Remain but now supports no-deal if the Withdrawal Agreement cannot be renegotiated.

Together then, taking into account the fact that the UK cannot renegotiate the Withdrawal Agreement, every single member of the Johnson Cabinet with significant control over Brexit now supports crashing out of the European Union without a deal. Indeed, considering the fragmented nature of May’s government, collective Cabinet responsibility is back in fashion, united behind no-deal. For those that wish to leave the EU with a deal and those that wish to remain, this is obviously a pretty bleak picture. Understandably so, since many experts agree that this scenario will be damaging to the UK’s economy, NHS, and global influence.

Regardless, based on Johnson’s rhetoric and Cabinet appointments, it looks very likely that the UK will crash out of the EU without a deal on 31 October. Furthermore, as this is the legal default, there is nothing that Parliament can really do to stop this without a change in the law. Such a change that would be very difficult to make within the time that is left and would very likely require an election. Even if MPs do take action, the threat of prorogation is very real with Mogg as Leader of the House of Commons. Ultimately then, a no-deal Brexit is now the primary policy of the British government and, while still not certain, appears to be the most likely outcome of the Brexit saga.

This post represents the views of the author and not those of the Brexit blog, nor the LSE. Image by ChiralJon,(CC BY 2.0).

Thomas Eason is a PhD International Relations student at the University of Nottingham.

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Brexit Britain’s Trumpian moment?

Boris Johnson’s adoption of a No-Deal exit as a viable policy option can only be described as Brexit Britain’s Trumpian moment, writes John Ryan (LSE).

US President Donald Trump told a crowd in Washington: ‘Boris is good. They call him Britain Trump.‘ German English-language service Deutsche Welle published an article with the title ‘Boris Johnson’s clowning glory‘. Seen as Donald Trump’s boastful mini-me by many with no electoral mandate from the British people for No Deal and with a record of incompetence, ineptitude and intellectual laziness – Boris Johnson has nevertheless just been elected by the Tory party membership to become the Conservative party‘s leader and then by default the UK’s prime minister.

In what can only be described as Brexit Britain’s Trumpian moment, Johnson showed his political opportunism by adopting the Brexit Party’s key policy of No Deal Brexit as the way to stem the rise of arch-Brexiteer Nigel Farage and to prevent the terminal decline of the Conservative party. Johnson’s lack of a viable plan for government besides a No Deal Brexit raises the prospect of a repeat of his tenure as Mayor of London in which he achieved little in eight years and in which he wasted money with little in the way of tangible benefits for Londoners.

Many adversaries, as well as colleagues of Boris Johnson, feel that he is personally unfit to be Prime Minister. The Guardian recently ran a series of articles during the Conservative leadership election pointing out his political and personal deficiencies. They say that he is a habitual liar, a cheat, a cruel betrayer of the women in his life, a politician who connived in a bid for a court order to suppress mention of a daughter he fathered, a do-nothing mayor of London and the worst foreign secretary in living memory. He was described as a diagnosed narcissist whose entire political career has been constructed through the prism of personal opportunism. Johnson as foreign secretary contributed to a British national Nazanin Zaghari-Ratcliffe, the British-Iranian citizen being incarcerated in Iran after he wrongly stated she was teaching journalism in the country, a comment cited by Iran to undermine her case.

There are known to be several Conservative MPs who have deep reservations about serving under a prime minister who is prepared to leave the EU without a Brexit deal on 31 October. An early vote of no confidence would trigger a 14-day period during which someone else – including Labour’s Jeremy Corbyn – could try and form a government which wins the support of the Commons. If that cannot be achieved, then the UK would face a general election. But to prevent a No Deal Brexit, there would need to be a new prime minister in place who is prepared to go to the EU to ask for a further extension before the 31 October 2019 deadline is reached.

Holding an election out of his own volition would be dangerous for Johnson with the poor state of the economy, the weakened pound, businesses leaving or not investing in the UK, the sad state of health care, council cuts to old-age care, rising debt and corroded public finances, the lack of police on the streets, climate change, supporting Trump’s foreign policy adventures, and dealing with China, Iran, Israel, Russia and Saudi Arabia.

The political fallout associated with the economic hit of a Johnson-induced No Deal Brexit should not be underestimated. We know that higher barriers to trade, investment and migration will damage UK productivity growth; and that British consumers will be forced to buy more expensive imports or lower quality British alternatives, hitting living standards. It will be a mix of the two, but that mix is hard to quantify. What is more, the Brexit referendum in 2016 coincided with robust global growth. With signs of a slowing global – and European – economy, the costs of Brexit would be more acute now. The immediate damage would be enormous, if only because of the uncertainty and the lack of preparation, both among governments and companies both in Britain and the EU.

Newly appointed members of the Boris Johnson cabinet do not inspire confidence. Former Brexit secretary Dominic Raab, now foreign secretary, was mocked for confessing he “hadn’t quite understood the full extent” of the UK’s dependence on the Dover-Calais crossing for trade. Former development secretary and staunch Brexiteer Priti Patel now home secretary made the outrageous suggestion that Britain should use the threat of food shortages to force Ireland to change its approach to Brexit. The tragedy of the Irish famine which caused the death of over a million Irish men, women and children was one of the most shameful episodes in British history.

Some people appear as stupid or ignorant because that is exactly what they are. Ignorant people can succeed against the odds if success depends on other, unrelated qualities. Boris Johnson is the populist’s populist and has been described as both the thinking man’s idiot and the idiot’s thinking man. For many inside and outside Britain, the Tory party seems to be governed by a self-involved clique which includes Boris Johnson that rewards group membership above competence and self-confidence above expertise.

Clearly, MPs damaged Johnson‘s hopes of forcing a No Deal Brexit through Parliament on 18 July 2019 when they voted by a large margin to prevent a future Johnson government from suspending it to prevent it from voting against No Deal. But that does not mean Parliament can legislate to stop No Deal without the government’s consent. There were some 47 Conservative MPs who defied the whip: 17, including the former digital minister Margot James, voted for the plan, while another 30 abstained, most notably Cabinet ministers at the time of the vote Philip Hammond, David Gauke, Rory Stewart and Greg Clark. Any plan by Boris Johnson to leave the EU without a deal would result in Parliament passing a vote of No Confidence in his government, with a high chance of success. That would almost certainly precipitate a General Election, in which a new mandate would be offered to ‘the people’, either to revoke Article 50, or to offer the nation a new referendum on Brexit.

Johnson wants to ensure there is no hard Irish border, even in a No Deal scenario, through so-called alternative arrangements – technological approaches by which customs and regulations checks would take place automatically, or away from the land border between the Republic of Ireland and Northern Ireland. The consensus among experts in the UK and the EU is that such technology is several years away from being useable, and there is not the slightest chance of a system being in place for 31 October 2019. Analysts at JP Morgan investment bank said the two Prime Ministerial candidates’ quest for a Brexit withdrawal agreement without the “Irish backstop” was like hunting a unicorn. “A unicorn with a lick of paint is still a unicorn,” analysts Malcolm Barr and Allan Monks wrote in a note sent to clients.

Johnson has got a technical working majority of two, which could fall to one after a by-election in Brecon on 1 August 2019. Last Wednesday Chancellor Philip Hammond, International Development Secretary Rory Stewart, Justice Secretary David Gauke and de facto deputy Prime Minister David Lidington all handed in their resignation after Theresa May’s final Prime Minister’s Questions and before May formally handed in her resignation to the Queen. A total of 17 ministers from Theresa May’s Government, including Penny Mordaunt, Liam Fox and Jeremy Hunt, were either sacked, resigned or retired. That is a  purge of unprecedented scale. Dominic Cummings, the former head of the Vote Leave campaign, was appointed Senior Adviser to Boris Johnson.  This is a now a radical right-wing Vote Leave Brexit government. Even before he stepped foot through the door of No.10, Johnson knew that others could drive the narrative of his premiership.

At Eton, notes James Wood in the London Review of Books, they were taught to impose themselves on the world with “effortless superiority”. But these people fall short too often. The trouble is they keep failing upwards – constantly given the benefit of the doubt, leaving them with the benefits and the rest of people of the UK with the consequences of leaders who are unable to run a modern society and economy with a detrimental effect for the less well-off citizens of Britain. On 22 July 2019,  an opinion piece in the New York Times gave this damming assessment of Boris Johnson:

“Boris Johnson, to whom lying comes as easily as breathing, is on the verge of becoming prime minister. He faces the most complex and intractable political crisis to affect Britain since 1945. That should be concerning enough. But given Britain’s political system — which relies for its maintenance on the character and disposition of the prime minister — it carries even graver importance. Mr. Johnson, whose laziness is proverbial and opportunism legendary, is a man well practiced in deceit, a pander willing to tickle the prejudices of his audience for easy gain. His personal life is incontinent, his public record inconsequential.”

On 24 July, the assessment in The Guardian editorial “Boris Johnson’s leadership: the years of a clown” was stark: “Burning bridges to Europe is an act of arson, not statesmanship. Leaving the EU without a deal threatens to wreck the UK economy, break up Britain and rekindle violence on the island of Ireland.” Prime Minister Johnson’s first soundbite outside Number 10 was “Forget the Backstop, the Buck Stops Here”. The first part of the phrase is wishful thinking, but the second part may come back to haunt him – especially with Nigel Farage’s Brexit party waiting for him to fail. There is no trust or enthusiasm for Prime Minister Johnson in the EU which will make any chance of a deal very difficult.

With the right-wing populist Boris Johnson taking the country’s premiership, Britain’s Trumpian moment has arrived. En route, Johnson has lulled the Tory party into Brexiteer unicorn illusions and raised the prospect of a No Deal Brexit. When reality hits, it may not only be a sore awakening for Boris Johnson and his government, but also for the United Kingdom.

This article gives the views of the author, and not the position of LSE Brexit, nor of the London School of Economics. Image © Flickr / BackBoris2012Campaign

Professor John Ryan is a Visiting Fellow at LSE IDEAS. He has been a researcher at CESifo, Munich, Germany, St Edmund’s College, University of Cambridge and the German Institute for International and Security Affairs, Berlin, Germany. John is working as a senior partner in consultancy as a Brexit adviser for EU, Gulf and Asian clients.

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