The Swiss-style Brexit delusion

Rotation is the clearest sign of intellectual muddle. When Britain left the EU, some leave supporters thought they could negotiate a bespoke agreement that would give them all the benefits of membership but none of the obligations. Then it was the Swiss model. Remember Chequers? It was the beginning of the end of Theresa May. The deal she finally negotiated would have kept the UK in the single market and the customs union for several years. The deal that was finally adopted comes under the moniker of Canada: a classic free trade deal.

Now the government is contemplating a rotation back to the Swiss model. After a predictable outcry following the reports in the Sunday Times, this has now been denied. The Tory party is back fighting its old divisions over Europe – through leaks for now. 

What this story is telling us is that Brexit is dying, by neglect. The situation was best described over the weekend by Andrew Neil, who wrote this:

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'The Government was supposed to create a post-Brexit low-tax, low-regulation, free-wheeling economic environment which would unleash homegrown entrepreneurs and turn Britain into a beacon for foreign investment, with enterprising business folk flooding to our shores. After Thursday, that is not going to happen'

The only, minor, disagreement with that statement is that the death of Brexit happened earlier. When people inside the British government talk about the Swiss model, they are basically seeking the best of both worlds: a menu choice the EU is not offering. The only available alternative is the undoing of Brexit itself. This means that the UK will eventually rejoin the customs union and/or the single market, with the full obligations this would entail. Labour leader Keir Starmer pledged he would not reopen this issue in his first term in office. That may well be so. But it could be a campaign theme for the second term of a Labour government. 

What the EU should be doing is to think hard about a new form of associate membership for countries like the UK. The absence of such an arrangement is part of the EU's innate dysfunctionality. It has taken in members, like Hungary and Poland, that openly refute the goal of ever closer union. Poland was admitted without even having amended its constitution to allow for the introduction of the euro.

The mistakes of enlargement cannot be undone. But what the EU can still do is insist that future members should take full part, with no opt-outs, and especially no opt-out from the euro. Those who do not wish to take part in such a close-knit arrangement would find associate membership more attractive, as it comes with lower burdens and greater freedoms. It should be possible to move from one to the other arrangement without causing friction. 

Such a model of associate membership would be fit for an independent Scotland, where delusions about EU membership persist. It would also be a model for countries that are not happy inside the EU.

Obviously, the euro would only come with full membership. And vice versa: you can't leave the EU and remain a member of the euro area. But there is no reason why associate membership status should not include both the customs union and the single market, and that it should also include a fair, but not full, degree of representation. Such a model would produce a lot more political unity than the current system.

It would also be a framework in which the UK could finally reconnect with the EU. The endless debate about the Swiss model reveals the sheer hopelessness of the current endeavour. The Swiss model is not even a model. It is a negotiation accident. From the EU's perspective, it is mostly a regret. The sooner leave voters realise that, the better.