Brexit state of play and the Tory leadership runners and riders

Apologies. I know I promised that this (delayed) edition of my weekly newsletter for Reaction would be dedicated to explaining why Brexit remains a terrific idea. But I’ve been thinking non-stop for 36 hours and I can’t come up with any reasons.

That was a joke. I will return to the theme of the wonders of Brexit in the next few days. I’m lost in a book that relates to a particular aspect of troubled European history that has got my mind working again after a spell of complete political overload.

Until then, I hope a state of play piece followed by a run through the Tory leadership contenders might be useful. Here it is.

The idea of Theresa May’s survival beyond Tory party conference seems far-fetched to me, but then a few months ago so did the idea of Jeremy Corbyn getting 40% of the vote, or Nicola Sturgeon going from her peaktime pomp to losing 21 seats in the general election and taking the SNP deep into troubled territory.

The problem for the Tories, and the country is this. Although both major parties are split to varying extents on Brexit, it is the Conservatives who will have to direct the British-end of the Brexit process. Barring the implosion of the cabinet, and a walk-out which puts hard Brexit Bennite Jeremy Corbyn in power, the Tories will have to do this, probably against the backdrop of serious economic trouble this autumn as the credit bubble bursts.

This is as close to being a 1940 moment as anything short of war. It will take a supreme act of leadership to deliver a Brexit deal and to heal, to the extent that it can be done at all, a divided UK. Personally, I think that means a degree of compromise and a two or three year transition period, with side deals on areas such as Euratom. What does that look like? It depends, on the personalities, on the economy, on the flow of talks. And there isn’t much time left to get organised. The Marxists (McDonnell openly cites Lenin and Trotsky) are at the gates.

There are friends of mine who call any Brexit compromise talk “going wobbly” but I think Brexiteers would do best to acknowledge the danger of rigidity. Offering no compromise at all right now, without attempting a deal, is in danger of sounding as bananas as the “I have a feeling in my waters this Brexit think can be stopped” proclamations of the ultra-remainers.

Even a compromise may not work, as the EU 27 could quite possibly balk at a deal right at the end. It seems worth trying, however, and if the political and media elite thinks there is hatred of them now they should try completely overturning the result of the referendum and seeing what happens.

As is so often the case in diplomacy, what this will ultimately come down to is a “power play” by a leader who can can say to Merkel and Macron something like the following:

“Whisky? Excellent. Large Laphroaigs for my friends. No, no ice in it, for goodness sake. Just a dash of water. Look. A deal is needed. Yes… yes… that’s for Barnier and so on to do. Of course. But they do all seem to be rather stuck. You, Iron Chancellor Angela, and you trainee Napoleon Emmanuel with your thin ties and your magnificent reforms (hubris anyone?) are great figures in European history who can break the deadlock. This is history. This is now. We want to trade with you. But there is the awkward business of you losing your second largest financial contributor, the UK, and us, in little old London being vital to making the eurozone debt machine go round, handling perhaps 70% of OTC derivates, and all those swaps and 80% of forex and 19% of bank lending in Europe. We all have interests here. It is vital that the eurozone prospers. Can we talk and settle this? Another whisky?”

Perhaps Theresa May can do that. Perhaps she can magically develop Churchill-style powers of off-the-record charm to cajole, inspire and motivate. But let’s face it, everyone, a personality transplant, after she has suffered the additional terrible trauma of the recent election, does seems somewhat unlikely.

If there is to be a change at some point this year, then who are the options?

David Davis: The frontrunner. All the talk of Davis representing “hard Brexit” is rooted in a weird misunderstanding of the position that I think stems from the “prepare for a hard Brexit to show determination” and “try to get a softer Brexit” approach he and his colleagues have adopted. If – if – there is a flexible deal to be done, it’ll take a pro-Brexit person to do it with room to shift and to build a coalition of moderate interests while pointing out to the Tory right that a split means letting Corbyn in to steal their mother’s large house in Surrey. It’s de Gaulle and Algeria, says a Davis advocate. It took de Gaulle to do the once unthinkable on Algeria. Strange alliances are emerging, with it seems the remnants of Team Osborne looking at Davis and thinking it could be him, and some Brexiteers seeing him in a crisis as the man to “save Brexit” via compromise.

Philip Hammond: In the volatile Tory leadership market, Hammond’s share price shot up and then back down. The Tories did safe and strong and stable when they chose May. Didn’t work out so great. The gossip is that the Chancellor has concluded that the voters are not crying out for him to become leader, but he could back Davis.

Boris: Down, but not out. The Foreign Secretary’s moment is probably gone, I said to one of his friends the other day. “Listen, in this game as long as you’re still breathing then your moment hasn’t gone.” But this does not feel like a time for jokes, and a switch to Boris could go extremely badly in the country where voters have had more than enough of being buggered about by the Tory party.

Amber Rudd: Talented. Good on TV. Pushing the remainer case in cabinet committees to the annoyance of Brexiteers. She has a majority of under 400 in Hastings and would be a target for an extraordinary opposition push locally. “She can move seat ahead of the next election,” says an ally. Yeah, right. Running away from the voters to find a safe seat would go down so well in the current climate!

Priti Patel: Watch out for Priti Patel as an outside bet. There are parallels with Thatcher post-1974. Tory men dismiss her loftily – “Not bright enough… lightweight… not enough of an intellect” – much in the way they thought a Thatcher victory against Ted Heath inherently ridiculous until she won, inspired a Tory revolution in ideas and kept winning. Patel is similar to early Thatcher in knowing her limitations and wanting to build an argument from first principles – that is freedom, liberty, enterprise and self-government. She would give Corbyn grief and be feisty as hell with socialist troublemakers. Many years ago Fraser Nelson tipped her as a future Tory leader. Could now happen.

Andrea Leadsom: Oh no… isn’t Britain in enough trouble? But Leadsom is the candidate most likely to be presented as the “how dare these men try to stitch up a coup” candidate, if they try, forcing a leadership election.  There are enough men with a Thatcher fixation on the diminished Tory right – who project their Maggie Mark II fantasies onto the leader of the House – to get Leadsom somewhere.

Outside the cabinet: There, there is astonishment and cold fury at developments. Who – they ask angrily – are these people in the cabinet trying to carve up the leadership of the country? George Freeman MP embodies a new generation approach – pro-enterprise, modern, dynamic, human. Would Burkian Jesse Norman MP run? Rory Stewart MP has a small but growing following.

Anyway, there’s the state of play as I see it. More on how terrific Brexit is when I have it.