The year ahead: A downbeat assessment of doomed Britain’s dire prospects

Those who view Britain’s departure from the European Union as the dawn of a new Golden Age are convinced that with the launch of the good ship Royal Sovereign on April 1 we will rediscover the dynamism and drive that for centuries made us one of the greatest trading nations in history.

And they may be right. With Liam Fox, David Davis and Boris Johnson leading the charge, what could possibly go wrong?

But what if the UK has decided to retire and draw its pension? Nations, like individuals, grow old and tired, which is why no country ever remains Number One for more than a certain time. In consideration of the bright future promised us by Leave, in which Britain is pumped up with energy and pride, it is worth remembering that the past really was another country. We did things differently then that we would never get away with today.

Buccaneering Britain, initially as England, has a long pedigree. Francis Drake earned his reputation stealing gold from Spanish galleons. Walter Raleigh, who made his original fortune confiscating land from the Irish, was executed after his privateers, ignoring his instructions, looted Spanish settlements in Venezuela.

But we were only getting started.

In the eighteenth century, Britain was like a 25-year-old who doesn’t give a stuff about his reputation so long as he gets what he wants. The East India Company, a private venture with a license to kill, was essentially piratical. It plundered India and China, caring only to make its investors rich. One of its brightest stars, Sir Stamford Raffles, invaded Java and went on to establish the colonies of Malaysia and Singapore. If the East India Company had a mission statement, it was Devil Take the Hindmost.

As the booty piled up – so much so that the State felt obliged to step in – the problem was what to do with it. Initially, only a minority profited from the riches that were created. There could only be so many country estates. Most ordinary Britons remained dirt-poor and worked so hard that they literally died of exhaustion. Slavery abroad and exploitation at home were what sustained the nation for nearly 200 years.

The Victorians continued in a similar vein. Gradually, however, as the Church regained its position as keeper of the national conscience, the realisation dawned that, to coin a phrase, we were all in it together. Public works and good causes became signature achievements of the decades after Dickens.

Abroad, most obviously in Africa, we continued to rob the natives – justifying our pillage by simultaneously preaching the word of God. But at home, alongside the thunder of the looms and the clanking of steel, came democratic accountability, and with accountability, material improvement. At last, the masses began to enjoy at least some of the fruits of their labour.

In the century that followed, marked by the Great Depression and two world wars, a new middle class arose, benefiting from the introduction of grammar schools and the availability of mortgages. But Britain gradually lost its oomph. The empire was gone, taking with it easy access to raw materials and guaranteed markets, and the national cake, though marginally more equally divided than in the past, had grown distinctly stale.

The people were vexed. Swinging London was show, not substance. Those at the bottom, for whom the lifestyles of the Beatles, the Rolling Stones and Terence Stamp stood in stark contrast to their own real-life experience, wanted more of everything. Strikes became routine. Employers, fearful of the unions, caved in to almost every demand. Labour governments, having nationalised the mines, railways and health provision, discovered that they were now themselves the employers, facing exactly the same demands as their despised private sector predecessors. The country went downhill fast. We became the Sick Man of Europe.

Fortunately, help was at hand. In 1973, Britain joined the Common Market. Not everyone approved. There was a feeling, even then, that Germany and France would become our new masters. But, after a stuttering start, culminating in 1979’s Winter of Discontent, the economy began to pick up. We ditched the Commonwealth with scarcely a backwards glance, embracing instead the European market and the Continental approach to business. The arrival of Margaret Thatcher – prime mover of the Single Market – greatly hastened the process. She had no time for slackers. Nor was she going to be bullied by Europe.  By 1990, by which time the Tory Party had had enough of Thatcherism, we were well on the road to recovery.

Over the next 18 years, in spite of its refusal ever truly to enter into the spirit of the European Project, Britain regained its place as one of the world’s most successful economies. Our preferred position on the EU was next to the exit, shouting abuse. It was industry, largely without fanfare, that appreciated the benefits. Our car manufacturing sector, having been bought up by European and Asian competitors, recovered much of its former vigour, while the City, which following the “Big Bang” rose from being merely large (and complacent) to being the world’s biggest and most sophisticated financial services provider, for a while outpacing New York and making London once again the number one global metropolis.

There was a downside, of course. The fire sale of industry that began under Thatcher gathered pace in the years following her overthrow. Company after company, brand after brand, sector after sector went under the hammer.

The disposal of the family silver, memorably lamented by the nonagenarian Harold Macmillan, was unique in Europe. No other EU member state followed the British example. By 2008, the Ebay Effect was such that only a handful of landmark manufacturing companies, such as Rolls-Royce, JCB and BAE Systems, remained in British hands. More recently, high street retailers have struggled to survive, construction giants (like Carillion) have gone under, and mortgage and insurance provision have became more and more the preserve of foreign lenders. In the capital, house sales increasingly involved overseas buyers, who see property as a safe investment and Londoners as their route to an easy fortune.

It is not, of course, all gloom and doom. Our higher education sector is booming, and as a result Britain is an acknowledged front-runner in information technology and artificial intelligence. That is no small matter. But here, too, there are issues. First, our universities face being cut off from EU-sponsored cooperation and exchange schemes. Second, the bulk of large-scale investment in UK tech – as in the country generally – has been foreign, not domestic. We don’t put our money where our brains are. We leave that to others, most recently the Belgians. Every time one of our startups produces something new and exciting, it is snapped up by American, Chinese, Japanese and European competitors. In the last 30 years, not one British high-tech company has gone on to be a global player. We prefer to take the money and run.

The jobs are there –­ for now – but the power lies beyond our borders.

Our utilities – electricity generation, water and sewage, gas distribution and railways – are mostly owned by overseas companies, often state controlled. The UK economy, unlike any other in the EU, has become a subsidiary of foreign interests, used by the outside world as either a cash-cow or a gateway to Europe..

Last month, Gatwick airport – the second-biggest in the nation – was sold to the Vinci Corporation of France. Eurotunnel is French-owned; Heathrow is Spanish. If it wasn’t for MAG, which owns and operates Manchester Airport as well as Stansted, all of Britain’s major international hubs would be foreign-owned – and 35.5 per cent of MAG is held by the Australian group, IFM Investors. Not one of the ferry operators linking the UK to the Continent and Ireland is British.  Of the three shipping companies newly recruited by the Government to help us over the hump of Brexit, one is French, another is Danish. The only British participant, Seaborne Freight, owns no ships and has never been to sea.

As we prepare to celebrate “taking back control,” the sell-off of Britain continues. The irony is there for all to see, yet goes largely unremarked. We pretend that it isn’t happening, or else that is actually rather clever of us to get others to run the economy, leaving us, as middle-managers and lineworkers, to keep their show on the road. Tee-hee, how smart are we?

Opponents of the EU like to remind us that the euro nearly died as a result of the 2008 financial crash. And it’s true. The single currency only just survived and is still suffering from the long-term consequences of the crisis. While the EU is large, with extensive safeguards, it is far from invulnerable. But sterling also reeled, as it will again in the days and weeks following a no deal Brexit. Royal Bank of Scotland, which by some measures was rated the world’s biggest bank in 2007, almost went out of business and had to be rescued by the taxpayer. Lloyds, too, was only saved with public money. Barclays, which was heading in the same direction, managed to avoid collapse but quickly (almost overnight) withdrew from being a hugely ambitious global player to being what it is today – a tightly-run high street operation with the bulk of its business located in the UK.

As always, the City ducked and dived, holding on to its primacy by a combination of light regulation and hard graft, bolstered by the fact that the world’s biggest banks and brokerage firms found it useful to be bunched together in a single offshore location. Its biggest challenge will come if and when its “passport” into the Eurozone is replaced by a series of single entry visas.

Which brings us to where we are today, poised on the brink of a form of Brexit that nobody wants, either no deal or half in, half out. Few believe that even a No-Deal Brexit will result in darkness at noon for the United Kingdom. The country will survive. It will adapt. In the end – say a decade from now – it may even prosper as a low-tax, high-incentives economy. But the idea of our leading a twenty-first century entrepreneurial revolution, transforming us into a vast, overstuffed Singapore, is surely wide of the mark.

Carmakers and other export-based manufacturers will face acute difficulties in the short-term and continuing disadvantages down the years. The City of London, as our biggest export earner, is bound to see its position as Europe’s banker of choice steadily eroded.

Travel around Europe for British citizens will become more difficult and more expensive. Our passports – “Fabriqué en France” – may be blue, but they will have to be accompanied by visas and will bar us from entry to EU-only travel lines.

On the world stage, the UK is widely expected to be less influential and less listened to. The leaders of China, India and Nigeria have all expressed astonishment that we should choose to leave the very organisation within which we have rebuilt our prosperity. Only Donald Trump and Vladimir Putin think Brexit is the best way forward. The Defence Secretary, Gavin Williamson, boasted just last week that we are about to regain a defence role east of Suez. Who does he think he’s kidding? The reality is that our military, like our diplomatic corps, is seriously overstretched after 30 years of cuts in both personnel and equipment.

But whatever happens, you can be sure that we will cling to our permanent seat on the UN Security Council like a condemned man to the tray holding the remains of his last meal (“Not finished yet”).

It is difficult not to call to mind the judgment of Kristian Jensen, the Danish finance minister, when he said in contemplation of Brexit that there were two kinds of European nations, those that were small and those that had not yet realised they were small.

Isn’t it the simple truth that we didn’t know when we were well off?

The good news is that Britain is not about to disappear down the rabbit hole of some dystopian Alice in Blunderland. Much more likely, we will settle for reduced prosperity and increased isolation and call it Freedom – until, that is, voters wake up to what has happened and start blaming everyone except themselves. Post-millennials, too young to have participated in the referendum, are likely to be especially miffed “How did you vote in the Great Referendum, dad?”

I will end as I began. My sense is that Britain is tired. Drained. Like a 70-year-old entrepreneur who realises that his children are only interested in their inheritance, the nation looks to be ready to sell up and live off its investments. If there are signs of us getting ready to fight for our future against all the odds, I must have missed them. We are past all that. We would rather slump down and watch football – foreign-owned clubs managed by foreigners, played, in the main, by athletes from beyond our shores.

Global Britain is like El Dorado. It doesn’t exist. The world markets from which we have apparently been excluded for the last 45 years have in reality been there all along. How else, as fellow members of the EU, would Germany manage to sell six times more to China than we do and Belgium more to India? If it wasn’t for the City and our membership of the Single Market, we’d have been be screwed. At the same time, that precious inward investment of which we like to boast is starting to ebb away. Foreign investment into the U.K. has fallen by 19 per cent since the Brexit vote in 2016 – the longest such decline since modern-day records began. International faith in our ability to rebound is wearing thin.

Maybe I’m wrong. Maybe Britain is about to experience a rebirth and London will indeed become the undisputed capital of capital. There are certainly possibilities. We could, for example, negotiate to join the laboriously named Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), linking us to nations as remote and diverse as Canada, Australia and Japan. But the EU recently signed comprehensive free trade deals with Japan and Canada and is currently negotiating with seven other CPTPP members. So wherein would lie the advantage of Britain’s solo approach?

Unless Brexit truly proves to be a wake up call, we may have to accept, like Portugal after its loss of Brazil, or Austria in 1918, that the management of decline is the only sensible way forward for the UK, at least until something else comes along. For those with the resource, that means investing abroad, a villa in Tuscany and holidays in Bermuda and St Moritz. For everyone else, for whom the dream of a second home in Spain and France my soon become a thing of the past, it is more likely to mean a re-discovery of the delights of Scarborough and Bognor-on-Sea and more nights-in in front of the telly.

But as Mrs May said recently, it won’t be the end of the world.

Exactly two hundred years ago, Raffles landed in Singapore, determined to make it one of the East India Company’s primary ports and trading centres. Full of energy, he was able to do as he pleased. This week, a weary Jeremy Hunt revisited the island nation in the hope of discovering the secret of its success. But this is 2019, not 1819, and our business leaders, still less our foreign secretaries, do not arrive in overseas markets backed by their own private armies. When the Royal Sovereign sets sail, it will be sailing into the unknown. My advice is, don’t sit up waiting for its return laden with riches.