122 | How Bad Could it Get?

As crunch time approaches, we talk through some worst-case Brexit scenarios: for the government, for the economy, for Remainers, for Europe. Have the negotiations been a humiliation for Britain? Is the Tory Party facing an existential crisis?  And what might go wrong if the marchers for a 'people's vote' got their way? Plus we speculate about what a no-deal Brexit would mean for Britain's service economy. With Diane Coyle, Helen Thompson and Chris Bickerton.

DAVID: Hello – my name is David Runciman and this is Talking Politics. This weekend, an anonymous Conservative MP in the kind of hateful and lurid language they tend to prefer said ‘We have entered the killing zone when it comes to Brexit.’ So we're going to talk about who is really at risk of catastrophe and where does the risk come from?

We have Helen Thompson with us, Chris Bickerton, and it's a pleasure, as well, to welcome back Diane Coyle, economist and professor of public policy here in Cambridge.

So there was that whole set of anonymous briefings and some of the language was even worse than it is… you'd have thought they might have learnt from when George Osborne said that he wanted to chop Mrs. May up that it's not a good look to talk like that. So we're not going to talk about the sort of killing language, but there are lots of other phrases that are being bandied around here, and I'm going to offer a few about worst case scenarios—just how bad this could get.

So one comes out of some conversations I had in Denmark. I'm sure they're not representative conversations, but I’m still struck by the force with which this was said. When I was there a couple of weeks ago, a number of people said to me, ‘How is Britain coping with its national humiliation?’ The thought being that the Brexit negotiations have completely humiliated Britain. And I said, ‘Are we being humiliated?’ I hadn’t, kind of, picked that up. And that seemed to provoke even more pleasure, the thought that we hadn't even noticed that we were being humiliated.

So are we, Chris, being humiliated? Is this a nationally humiliating experience that we're going through?

CHRIS: I don’t think so. I mean there's a fair bit of schadenfreude around, I think…

DAVID: And the Danish word for that is?

CHRIS: No idea.

DAVID: No, me either.

CHRIS: So I think that's what you were describing. What I'm often struck by is not so much people taking pleasure in the British experience but it not being an issue. So Brexit is forefront of people's minds, I think, certainly in this country. But I think in the rest of Europe it is simply much less of a discussion point, to the point of it being non-existent in debate whatsoever.

DAVID: I should say, I suspect, in Denmark there's more of an interest maybe than in other places because Denmark has its own complicated relationship with the EU.

CHRIS: That's right. And it sort of has negotiated opt outs, and there was a sort of a close cousin of the UK in that sense. So maybe it's a sort of, ‘This is what it would have happened to us.’

DAVID: There but for the grace of God.

CHRIS: That's right. And humiliation, I think, is not really the right way of putting it. Has the UK been successful so far in its negotiations? Who's won out, if you like, in the sort of tussle? That's a real subject for discussion. I think the UK—I've always said this—that UK started out absolutely on the wrong foot. It triggered Article 50 much too early, and I think in a negotiation strategy with the European Union, if you're unwilling to walk away, you will never negotiate successfully. And the UK has simply never been willing to walk away in a meaningful sense. So I think it was inevitable that it would find itself on the back foot in negotiations.

DAVID: So I think what's trying to be conveyed by the thought of humiliation is that this is… partly the feeling is there are delusions of grandeur going on here, but this is a country that was asserting what it thought was its power and its autonomy, and it is discovering that it does not have the power and autonomy that it thought it had. And to do that in public, whether it's a person or a country, to be shown up to have delusions about how much control you have over your own affairs is humiliating. That’s the thought. [4:06]

DIANE: Well I suppose there's some comfort in the fact that other European countries have their own preoccupations too. Italy is not in a happy place, economically. The politics of the Eastern countries is troubling. So I guess that tempers any concern about our humiliation.

DAVID: You don’t think that we have been seen, even in places where they have their other concerns, to have overreached here? I mean that's the thought, that we, unlike other European countries which are going through their travails, we're the ones who didn't understand the limits of our power.

HELEN: Well I think there's two different things going on here. I think there is a way in which there are plenty of people in other European countries who do think in these terms. There’s an article—a very strange article in a number of ways—in Der Spiegel at the moment basically saying Britain is becoming a laughingstock and this once pragmatic country it’s got these delusions of grandeur, and it's all hubris trying to exercise power that doesn't exist. So I think that there is a take out there in those terms, and it certainly is the case, as Chris has said, that there's nothing that could be said to have vindicated Britain's negotiating strategy thus far. I think though that the other side of it really is… is that the difficulty that many continental Europeans have in understanding why Brexit came about and what it's about. So that in terms of the coalition of Leave voters, this always seemed to me to be much more about refusing consent to the European Union for one reason or another, in fact there are quite a lot of different reasons. And then what happened was… is that the British government accepted that the referendum was going to be—at least then they accepted—that the referendum was going to be final, that Britain really was going to leave the European Union. So it accepted the geopolitical consequences of the decision of its domestic electorate. And I think that that is quite unfathomable in a number of other European political cultures, this idea that consent really does matter, and that if you don’t have it, you can’t proceed. It’s not something that’s there to the fore in, say, German politics. I don't know enough about Danish politics to make a claim about that. But you know this stuff has a long history in Britain. The British governments have tended to be—and the English crown before that—have tended to be quite responsive to domestic rebellious discontent and the different forms in which it has taken. Now the government now has been trying to work out how to deal with that in a pretty difficult international political environment, made more complicated for Britain, I think, by Trump’s election to the presidency and then the pressure that Trump himself has been putting on the European Union. And it must be said, I think, that Trump’s pressure on European Union countries, including Germany individually, has been on a lot more successful than Britain's negotiating strategy has thus far been. I think you can say Trump's more effective disruption actually adds to the sense of Britain not getting anywhere very successfully thus far, at least in terms of negotiating an outcome. But the fundamental thing that's going on, it seems to me, that's incomprehensible to some is the fact the British government was prepared to accept the outcome of the referendum and act upon it.

DAVID:  But couldn't you put it the other way: that actually this isn't about a country that's deluded about its own power, but this is a country that's deluded about the extent that consent can be the primary motivation in international politics and the driver of this, that what you're seeing is a government that's accepted that its people is no longer willing to offer consent to the arrangements of the European Union, but it hasn't thought through how that then becomes its own capacity to act.

HELEN: I think that you can make that argument, but I think you can make the argument the exact opposite way round. The British case has grappled with something that others are a long, long way from a facing.

DAVID: Are they going to have to face it?

DIANE: Well I agree that there are a lot of people around Europe that are laughing at us, and I've come across this in many other countries apart from Denmark. But isn't it a kind of nervous laughter? Because many of those countries have the same fractures that we do and that gave rise to the very narrow vote in the referendum.

CHRIS: I think Diane’s right. I think people look at Brexit through their own experiences. I think that's pretty natural. And what you have in the history, certainly of European integration over the last 20 years, has been quite a lot of contestation, quite a few doubts. You've had votes that have not been binding and have been reversed in relationship to treaty changes. So there's a very ambivalent relationship to the principle of consent, consent defined in terms of the national population making a decision and then the executive respecting it or not. So in the case of Brexit, I suppose in some ways it may well be, not so much baffling, but sort of surprising that there's been a dogged determination to treat the referendum as final. And that, if you filter that through different political systems where the experiences have been a bit more complex, not necessarily the same, then it does seem sort of puzzling, but also troubling. And from the European Union's perspective,  I think it's quite a troubling prospect if consent is put to the forefront of its own affairs. I mean, I think the sentiments, the way people respond, are very complex. And I don’t deny that some people say, ‘Hahaha look at what you're doing.’ I think they don’t get what's happening. I think a more measured response is to say that this is interesting, it’s a sign that something else is going on, and it raises questions for the way the European Union will function in the future.[9:38]

DAVID: And is some of it… because one way you can get round this thought that what's happening in Britain might be coming for us is to remind yourself that Britain is different. And so a lot of that sense that something strange is happening in Britain is being explained, not because something strange is happening to our politics, but because the British are strange. And that seems to be part of what I was picking up that this is hubris and this is humiliation because it's a classic British story about imperial delusion.

DIANE: But it's not the case that euro-skepticism is greater in Britain than any other country.

DAVID: No, exactly. So that's one way that people on the continent can explain this away, which is to say it's about British exceptionalism.

CHRIS: But it is also not just on the continent. I think the extent to which the analysis of the Brexit result in this country relies very heavily on some sense that people are trying to relaunch sort of an imperial project is a way of explaining away what's going on. I think that's not an insignificant part, but I think it's by no means the most important.

HELEN: I think in the terms of Leave voters, as opposed to a number of the conservative politicians in the Leave campaign, there's zero evidence that imperial nostalgia is part of what's going on here. I think that's actually more the other way round, in the sense of the argument that Britain must have outsized influence in the world is actually more common on the Remain side of the arguments, actually than it is on the Leave side, as I said, exempting a few conservative politicians from that. The other thing about the British exceptionalism issue is that I think we can say there are some things that are exceptional about Britain's position: the circumstances in which it joined the European community in the first place, the position of the House of Commons, the principle of parliamentary sovereignty, the fact that it wasn't in the euro, the fact that it was the only large country that didn't have transitional arrangements on Eastern European accession in 2004. So there was a story to tell which said, look Britain never really fit inside the European Union—that's essentially what Charles de Gaulle was saying when he didn't want Britain in the European Economic Community in the first place. But that kind of path of understanding Brexit, both internally and within the European Union, or in parts of the European Union, was rejected because in that sense Brexit could have been more easily accommodated, a kind of line of argument that said, ‘Look Britain's membership was never going to work.’ But I think that the difficulty for the way in which it might induce, shall we say with Diane’s phrase, I suppose nervous laughter elsewhere is that actually Britain, in the end, should be able to leave the European Union without a great deal of difficulty. And I say that meaning over the long term, I don't mean the short term because clearly there can be huge amounts of catastrophic disruption in the short term. And it can do so because it's got its own currency. If one of the other countries that’s in the euro gets into the same level of difficulty with consent then that's a whole other problem. And I think we're beginning to see that playing out in Italy. Now Italy’s got some cards to play in all this, it's not Greece. But in some sense, Britain’s an easy, comparatively easy case in thinking about how this consent dynamic plays out through time. But if you’re putting consent against euro membership and all the debt that goes with that, I don't think anybody really knows how to start thinking about that. And that, I think, is where there is reason for others to worry about where the more general phenomenon of euro-skepticism might be going.

DAVID: Okay, let’s pick up on a few other worst case scenarios. You had a phrase there, ‘catastrophic disruption,’ even if it's only in the short term. So Diane, we don't hear much about Project Fear anymore. It was thought to have been, sort of exposed by the months after the referendum as being overblown. But the rumbling has always been there, that in the background of whatever these negotiations are going to result in are some really, really serious economic risks.

DIANE: Project Fear is morphing into Project Catastrophe.

DAVID: Is it? That’s cheery.

DIANE: Well I'm not particularly pessimistic by nature, but I have started stockpiling. And when we first had the vote, I thought, okay the economy is going to be a little bit worse than it would otherwise have been for the transition period, but economies adjust, and so the reason to be upset if you’re a remainer is the emotional one about your identity and citizenship. And as it has gone on, and it turns out the government couldn't negotiate it’s way into a paper bag…

DAVID: So not even out of a paper bag, into a paper bag…

DIANE: I have become more and more concerned about the economic disruption. And I think the people debating among themselves and the government about what kind of deal we want simply don’t understand the character of trade now. And it isn't only that a lot of trade is services, and that's why we have a surplus, whereas we have a deficit in goods. It’s the character of the goods trade—that we import… about two thirds of the goods that we import are inputs into things that we make. So if we don’t import them without friction and cost, we can’t export either. The scale of the disruption that is possible now is simply catastrophic. As I ate my cereal this morning, there was a story in The Financial Times saying that the government is commissioning a flotilla of boats to bring goods like medicines and radioactive isotopes and food over from continental Europe because Dover will only be able to operate at most a quarter of its capacity, given the frictions it’s going to introduce. This is going to make the economy grind to a halt because we have a Just-In-Time economy throughout the whole production chain, all the way to things we buy in the shops. We’re going to run out of stuff really quickly, and lots of people will lose their jobs. [15:28]

DAVID: And when you say the politicians who are negotiating don't understand this, presumably they are being advised by some people who are telling them this, including in the civil service. There’s a complementary question going on at the moment about the politicization, as perceived by the politicians, of the civil service, but are they simply discounting this because they think, as it were, that this is Project Fear coming the other way back at them? Do you have a sense of what…

DIANE: I think we would need a psychologist to answer that because, as you say, they must have been given relevant information about the scope of the possible disruption. And there are, of course, there's one group of economists who you can lite on if you want not to worry about disruption, about a dozen of them, who make things up. So their latest report claims that more people work in the fishing industry than the car industry in the UK. Well actually it's 12,000 versus more than half million, many, many, many more people work in the car industry. And that's one of the ones that will be massively disrupted if the components that are imported to make cars can't come in, and people in the Northeast will lose their jobs and investments won't happen. So I'm now really concerned about what's going to happen to the economy.

HELEN: I don’t think you need a psychologist to understand what's going on here. I mean, I'm not making any dispute about the catastrophic disruption. The difficulty that the government is in is that unless they agree, in the present negotiating position of the European Union, to something that in its implications for Northern Ireland is never ever going to get through the House of Commons—it wouldn’t get, I don't believe with the House of Commons even if the DUP weren't providing support to the Conservative government—then there isn't any way of proceeding to a deal. There is this issue, I think, it’s haunted the referendum campaign itself, it’s haunted everything that's happened in our domestic political discourse since… is if the EU isn't actually some actor in this with a political entity that has got opposition and will respond in relation to the things that we do. And at the moment there is not, from the point of view of the government, and I believe the point of view of parliament, something that is on offer that can be taken. Simply, there is no way that a British government will accept that Northern Ireland is going to be in perpetuity in a customs union and single market separate from Britain. Unless the British government can change that negotiating position of the EU, then we're going to be stuck here.

DAVID: But at what point does the economic worst case scenario that Diane describes collide with these political imperatives? Because if that happens, if the stockpiling scenario starts to play out, the politics change…

HELEN: I think you can see movement in this in terms of the EU—obviously I keep using this EU position as a shorthand, and there's not a single position. I think that Merkel's remarks last week, where she called for creativity on both sides, suggests that Merkel really, really does not want this no deal scenario because it's also extremely difficult for German carmakers once we want to go down this road. I am actually more optimistic that compromises will lead to an agreement. I’m more pessimistic about whether that can be got through the House of Commons. I’m a bit more optimistic than I was last week, but I think we got to separate this out into two different things. Is it possible for there to be some compromise between the two positions of the British government and the EU? At the moment, I think the answer to that is yes. Is it possible for that then to get through the House of Commons? I think that that issue is a lot more complicated to think about.

DAVID: And Diane, before I ask Chris what he thinks, just to be clear, we’re talking about worst case scenario here. So there’s a no deal worst case scenario, but as you move back up the various kinds of options that fall short of the status quo, at what point does it become okay in your mind?

DIANE: There’s going to be some long term damage anyway just from lost investment that’s already occurring, and many more companies will be moving activities and moving their investment plans already. I agree with Helen that some agreement would be possible, that there is actually willingness on the EU side to make it less potentially catastrophic than it could be, and the closer we get to a customs union, single market—I don’t think there’s a particular dividing line, but the closer we get to that, then the less catastrophic it becomes.

DAVID: So in your mind, every step away from where we are now is a step towards economic… bads?

DIANE: There comes some point when the supply chains don’t work, and I don’t think there’s any signs about what that point is.

CHRIS:
I think it’s certainly the case that we’re reaching a sort of end game in the negotiations and that it’s not surprising that there’s a sort of ratcheting up of what’s at stake because that has quite an important effect on both sides. On the UK side, it might make a deal that might seem unacceptable more acceptable, both for the government for the MP, for the House of Commons, and for people observing it from the UK side. On the EU side, it may make some sort of compromise more acceptable as well. And we have to remember that the report that Diane was mentioning that was in the FT this morning, what happens on the British side in Dover is not the problem. It’s that checks would be enforced on the French side, which is what would slow things down. And so it’s the extent to which the European Union responds in a way that enforces whatever the no deal implications are for the EU are the decisive things. The UK could simply decide to not proceed with things that it thinks would slow down trade. But if the European Union decides to enforce the outcome of no deal, then you have many of the problems. So it's also about the responses of the European Union, not just what happens in the UK.

DIANE: These are such finely tuned supply chains that any fiction can...

CHRIS: Sure, so this is the other issue, is, I think, the issue about the extent to which the kind of economies that we have at the moment are ones that are very vulnerable to any kind of change. For me that's certainly significant. I think the UK economy is characterized by supply chains that are excessively spread out across all sorts of different places, which means that there's less robustness, I think, to the UK economy, and also means that a lot of economic activity is located in other places, and then certain things are done in the UK, and then goods are shipped elsewhere. There's an opportunity to change that. But for me it seems fundamentally problematic if we're in a situation where we say any departure from the status quo in economic terms is a short step away from various iterations of bad to catastrophic. Because then you say, so how does any government implement any change in their economy? How do people decide that they want to have a different kind of economy? We're in a scenario where change is simply associated with catastrophe and that I simply don’t buy. I just don’t think that that's the case. I think that's just an attitude towards change which is conservative, I think.

DIANE: Well economies change all the time, so I'm certainly not trying to say that. But then that points to a slower adjustment or a longer transition period. It’s the cliff edge nature of what might happen that is potentially catastrophic.

CHRIS: That's right. Nobody, I think, realized at the end of March 2017 when Article 50 was triggered that we were embarking on quite a fundamental process of economic transformation under a timeline that was absolutely impossible to honor. And it was an entirely dysfunctional way of taking an economy out of an integrated regional economy. This no deal, for me, it's a kind of still a 50/50 thing. It’s a product of the negotiations, but also the way in which the negotiations proceeded under this very difficult time. But the UK government I think is culpable because from the very moment it triggered Article 50, it should have undertaken extensive and very radical plans for preparing for a no deal. [23:09]

DAVID: [24:18] Can I just ask, because Diane mentioned the other side of this, which is, you will find some people who will tell you it's not going to be nearly so bad. And we are in a world now where you can find your preferred expert who will tell you it's going to be okay. If we think again about the psychology of this, how much of that is part of the problem here? Because you're both describing the need to face reality. And yet there does seem still to be some unreality in some of the political positions being adopted on the Brexit side.

DIANE: I think part of the issue is that as soon as you start talking about Norway and Canada plus plus, and all the intricate details of trade negotiations, everybody switches off. And it's not as complicated as it can easily seem to be.

DAVID: But also, as you described it, there are people who will simply give you the fantasy that will allow you to continue on your reckless path, aren’t there?

CHRIS: No, I think what you're describing is something else. I think you're describing people's response to what they feel have been misjudgments in the past. So if you were told, and if you thought genuinely, okay I was told that the economy is going to simply bomb after the referendum result if we vote to leave, then you think, hang on this is clearly not happening. You then think, all these economic models that predict this and that, how much credence should I give to them? So I think there's a willingness now to be a bit more skeptical of this idea that just round the corner is catastrophe. What I think is probably important is to realize is that we’re not in July 2016. We are now just a few months off leaving the European Union. The way the negotiations have been played out make a no deal scenario reasonably likely. The critical factor is that government has been unwilling to prepare in any systematic fashion for no deal, and is only doing so very late on and in a rather haphazard way.

DAVID: So then one more question to Diane: is there any preparation for no deal that would really make a significant difference? I mean, what you described seemed to be something that is a situation over which the government effectively has lost control?

DIANE: The only way to deal with it now would be to have an agreement about a long transition period so that the preparations that Chris is talking about could occur.

HELEN: I mean I think that there was always going to be a case for a relatively long transition if you just thought about this in terms of how you deal with Britain leaving the European Union in straightforward economic terms. The problem of a longer transition in political terms is the lack of trust that there would be in it because of that clear campaign by some, including some of Parliament, to stop Brexit, and that it would simply be seen as a means of keeping us in the European Union and buying time. And this is where, I think, how many different things are going on for a state in withdrawing from the European Union really comes to the fore because on the one hand, as Chris said, it's changing its economic relationship with European Union; on the other hand it's changing its own constitutional order, which had become completely bound up with being a member of the European Union, and it was also changing our position of citizens, where we were going to stop being European Union citizens and only be British citizens. And that has got identity implications for lots of people. That's an awful lot of change that has been converged into one thing. Now I think that the constitutional one, I think, is underestimated because what we've got to do is find a way of legitimating the constitutional order that is going to come forwards, going back to not being in the European Union, and that is going to be very difficult regardless of the economic outcome. But it's going to be extremely difficult if it ends up with no deal and a large amount of damage in the short term, but it's also going to be quite difficult, in fact I think very difficult, if you have a longer transition period and then the transition period is used by those who want to keep Britain in the European Union for that purpose, because then the transition period is going to be seen as something that is just a Trojan horse for Britain staying in the European Union. [28:05]

DAVID: Okay then let's do the politics of this—come back to the economics as it impinges on it. So another word that was used at the weekend amid all the terrible talk about different ways of killing Theresa May was that this poses an existential threat to the Conservative Party, that if the Conservative Party gets this wrong, it could be finished. And people often say this in democratic politics and I tend to discount it, except not so much these days because parties are having the rug pulled out from under them around the world. And it's not like it might have been 20 or 30 years ago; it's not like Black Wednesday in the era where there's a kind of a sense that even if you are about to enter sort of 10 plus years of the voters not trusting you, there will be time to come back. And parties that completely forfeit trust these days do risk oblivion, I think. Do you think there is a serious risk for the Conservative Party that this goes wrong they can never come back? I mean I know Britain is a broadly conservative country and it's going to need a party, insofar as we have a democracy, of the center right. But this party, the longest lasting and most successful election winning machine in world democratic history, is it on the brink?

CHRIS: Make or break is maybe the way to put it. I think if the Conservative Party is able to position itself such that it is clearly committed to implementing the result of the referendum, come what may, even if it makes it clear that this may take a little bit longer than people would wish in order to make it a smoother process, but it will honor the result of the referendum, when it comes to the next general election that would put people in a position where even if they might have been much more inclined to vote Labour, they would vote conservative because it’s the party that seems most committed to doing that. That’s the sort of the make part of the make or break. If we get this situation where it's the complete breakdown in the negotiations, there's an impasse, or if Theresa May brings something which she then can't get through Parliament, the question is whether the Conservative Party is blamed for this or whether the blame is shared across the political class, across the political establishment, and also is partly laid at the door of the European Union. I think people would not just say this is entirely the Tories fault. That doesn't seem to me a reasonable position to hold. I don't think that a Labour government would have necessarily managed to do any better.

DAVID: Do you have faith in people being reasonable?

HELEN: I completely take at least one part of what Chris has said. I think you can see the beginnings of that position, of where the Tory party becomes the party that it's about honoring the referendum, not about being pro-Brexit but about honoring the referendum result. And that was a position that Theresa May made got herself into about a month before the general election last time, when they were able to win that byelection in Cumbria and do very well in that one in Stoke. There was a scenario in which the conservatives were going to end up in that general election with almost all—or the equivalent because it wasn't obviously the same voters—of the Leave voters, somewhere between 48 and 50 percent of the voters. There was a moment, I think, in that general election where that campaign was beginning where that was possible. It fell away for various numbers of reasons to do it with Theresa May's poor performance and particularly, I think, to do with social care. So I think that you can see a scenario in which the Conservatives, depending on how the end game absolutely, actually plays out, where it becomes the… on with the referendum party. I think the problem for the Conservatives is just the factionalization internally within the party and just how destructive, including just at the level of personal relationships, what has happened over the last few years has been. Now I think if Labour had been in power at this time, I don't think it would have been any different because Labour is just as actually divided about Brexit amongst its politicians. It would have struggled in exactly the same way. And I think that there is a chance that, as Chris says, that the blame will be directed at the political class quite generally, as opposed to it being party political, particularly amongst Leave voters. Because, you know, you can't really get around the fact that it is pretty obvious that significant people in the—to use that term, the ‘political class,’ I know you don’t like it—have been trying to stop Brexit. And that has played a part in the negotiating impasse that has been reached.

DIANE: But it is not the case that voters don’t like seeing such wide divisions within parties? So both Labour and Conservatives will get punished for that in some way.

DAVID: Well then who are people going to vote for?

DIANE: Many people are asking themselves that question.

CHRIS: I think the response could be a disenchantment with the ability of politics as a thing, as a system, as a field, to function, in which case people can simply opt out of it—get disenchanted and sort of apathetic, creating an entirely new party. I mean it’s—David you’ve mentioned this before—we’re in an age where this is happening in many places. Sometimes it’s happening so incredibly fast that it’s difficult to even believe, but it does happen. All parties just get pushed to the side, something entirely new, cobbled together is incredibly successful in elections. I find it hard to believe that the UK, however particular its own political traditions might be… that it is entirely immune from that.

DIANE: Does it put the focus more on the nation’s and the big city’s politics, where at least three of the English cities now have very effective mayors?

DAVID: As where people genuinely start looking outside Westminster for political leadership?

DIANE: That’s a thought.

HELEN: I mean, I think that what you’ve got to think about is what’s happening in countries that have got some version of two party systems, and I know we’ve had in the past, well until recently, two and a half party systems plus Scotland, which is a whole other complication in this. Leaving Scotland out of it for the minute, the clear case where a two party system might something very disruptive has happened is the United States, where both parties got into difficulty for different reasons. The Democrats’ case was camouflaged by Obama's personal success. And then what happened is one of the parties was effectively taken over by an insurgent candidate from within. Whereas if you look at what’s happened in Germany, say, where the dominant two party system is breaking down, and it’s moving towards a multi-party system, but, you know, the general electoral system supports that; it’s not going to support that here. So I think you might then be looking at insurgency within one of the parties now. We've already got an insurgency of a kind within the Labor Party from Corbyn’s leadership, but we know that that hasn't penetrated that far within the parliamentary party. So in some sense, the interesting question becomes, ‘Okay, what happens to the Conservative Party in terms of an insurgent candidacy?’ Does it go off in a kind of Trump-like direction under this kind of political pressure? I don't know what the answer to that is, but I think that's kind of the question. [34:53]

DAVID: One more thought about the conservatives. The problem is exactly as you describe that you see this government in desperate trouble and you immediately think, well who would be able to do this better? And every group or coalition you think of, there are reasons for thinking it would be even worse. So whether it was the hard Brexiteers, whether it was the softer semi-remains in the Tory party, whether it was a Labour government, whether it was some kind coalition… And so it's that sort of Sherlock Holmes things: you rule out all of the things that seem impossible, and then you're left with Theresa May again. And it must at least be possible that, actually, much derided though she is (I think the latest poll had 2 percent of people thinking that she was having a successful negotiation), she's the only person who can actually , ncluding on the questions that are holding things up in Ireland, she's the only person who can actually take us from here to somewhere else. Everything else the blocks are even greater.

HELEN: I think she is occupying the literal center ground.

DAVID: And I'll tell people that Helen moved her arms apart as she described that. But it's a very… as people say, it's like a little precipice on the edge of something and she's just tip-toeing along.

HELEN: I mean, as you know, she's trying to respect the result of the referendum. She's trying to say that there's a red line over freedom of movement. She won't let Northern Ireland be into a separate customs and regulatory environment than the rest. And she wants to deal. And that is probably…

DIANE:  But there's no overlap in that ven diagram.

DAVID: So in fact your hands should be actually touching each other…  

HELEN: So this is where, as I say, it's always got to be filtered through what the EU is actually doing in this. And the European Union has taken a very strident stand on the question of the Irish border and the response it wants via the backstop to the Irish border. If Theresa May cannot deliver something that can get through the House of Commons, I think it ultimately will be because the EU has taken that stand. And I'm not making a judgment about it one way or another, but that is not something that was in the negotiating. We go back to the way things looked in March 2017, when it was a different government in Dublin. This is not necessarily a path that could have been anticipated. Now some people would say, ‘Well that's naive because you could see that the European Union would use the Irish question as a way of trying to either to humiliate Britain or to try to keep it in the European Union by default.’ On the second, I still think it's a very open question whether the governments that matter here, the French and the German, really do want to keep it in the European Union. [37:19]

DAVID: Two more things, two other Brexit developments. One I can’t talk about because it makes me to get too agitated, which is Nick Clegg taking a job at Facebook, so we won't discuss that. The other one is the 6-700,000 people who marched on Saturday. And there clearly is—and in a town like Cambridge you hear it all the time—there are a lot of people who genuinely believe that this can be prevented from happening. Whether it’s a people’s vote or whatever, that we are, as we approach the moment of truth, going to get an option to somehow undo this. Now who knows if that's even conceivable. But there is another worst case scenarios. So in that version of Brexit politics, people never talk about what could go wrong if the Remainers got their way. And when they do, they sort of assume that there would be massive resentment and possibly even resistance from Brexiteers. But I also had this thought, to go back to what Diane said earlier, that European politics is not waiting on us. It’s unfolding at a remarkable pace. I have a real anxiety about a Britain undoing the thing that it thought it did just at the moment were something really bad happens to the European project, whether it’s Italy or whatever. There is almost the nightmare scenario where we decide we want back in at the moment where this thing starts to fall apart. I mean there are huge risks, it seems to me, both ways, aren’t there? If Europe is facing two challenges, one of which is actually relatively tractable, which is Britain, and the other of which is for it, existential, which is Italy, what would a second referendum be like when the other one starts to bite?

DIANE: There are huge risks whatever happens because of the underlying social and economic fractures in the European economies. And the fact that we didn't tackle for decades the costs that economic change and technology, the wreckage of the Northern and Midlands economies created by that… And I think that's true… it’s certainly true of France and Germany as well. And we are paying that price. And until those fractures are addressed, there is a risk for everybody in whatever happens.

CHRIS: I think the European Union is sat on a whole bunch of different problems, there’s no doubt about it. But its capacity to adapt, I think, is quite high. Certainly, I mean it's very monolithic in its relationship to outside actors, but internally it has high capacity to differentiate, it’s been doing that for a long time. I think I'm more sanguine about its ability to survive. What it becomes is an open question, but its ability to exist as a thing… So I don’t think the UK would find itself in a position to be wanting to rejoin something which was literally up in flames. I think it would be wanting to join a flawed project, and so it shouldn’t do it. But the thing itself, I think, is unlikely to disappear from one day to the next. It would be a kind of a slow process of internal erosion, I think. The issue about Remain and the march—I think people were quite right to go on the march and march in large numbers for what they believe in. I mean there’s a lot of opposition to what’s happening. People would like things to be different. So I think that’s what was being expressed. As a practical input into the next six months, I don’t really see it. I may be missing something, but it seems to me that if the deal goes to the Commons and is rejected, we’re in a sort of entirely open moment politically. And in that way, the question of the UK’s relationship to the EU become subsumed in the future of British politics itself.

DAVID: Helen, you get the last word.

HELEN: I think that this goes to the heart of what's been the problem for those who want to stop Brexit from the start is that they don’t have a strategy for it being inside the European Union. They don’t actually even give it much thought, I don’t think. There is an assumption that things can go back to the way that they were before the 23 of June 2016, and since then, the European Union has had to deal with a set of new challenges, in which, to a considerable degree, Britain is irrelevant. I think if you look at the… if you like, the trigger causes, the immediate trigger causes of the 2016 vote here, I think you can say that there was one thing about Britain's relationship with the European Union that really pushed in certain circumstances, which was the Eurozone going back into recession 2011-2013, to cause a problem. As you have the British economy that was recovering, you've got the Eurozone crisis, particularly in Southern Europe, and you get significant migration out of those periphery southern European economies into Britain—UKIP puts pressure on Cameron. So if you go back to conditions of severe Eurozone crisis, you are going to get the same thing if freedom of movement still exists in this country, assuming that the British economy is doing better at that point then the Eurozone. So you just go back to where we started. The other thing that's interesting is that two things happened in 2015, that Britain actually wasn't directly affected by, that the EU did. The first was the handling by the Eurozone authorities of the Greeks in the summer of 2015. Then the third was Merkel's handling of the migrant crisis, in which Britain had opt outs. So it didn't have an obligation to accept refugees and migrants like others did under the rules. And those two things still did significant damage to the Remain cause. So watching the EU behave, if you like, at moments of crisis is not something that goes down well with a significant number of British voters, it would seem. Even when British interests weren't directly at stake. And they are at stake in terms of the freedom of movement issue if and when the Eurozone economy goes back into crisis, and we can already see the beginnings of that in terms of what's going on in Italy is the whole question of how the ECB is going to end quantitative easing. It's got to play itself out, and I cannot see how it plays itself out in ways that don't prove extremely difficult for the Eurozone.

DAVID: As Diane just said, we could talk about this all day. We’re going to come back to Italy. We need to talk much, much more about what's going on there. But for the next couple of weeks, it's back to Trumpland. We're going to talk to the historian Sarah Churchwell about the history of America first, and then we've got our special live post midterm breakfast event when we all say what we think is happening. Anyone in Cambridge who might like to come along, we'll tweet how to get tickets for that. My name is David Runciman, and we've been talking politics.