There is another bout of optimism in the Brexit talks. A deal may well be reached. But it is worth noting that if Boris Johnson makes the compromises necessary to get a deal, he's taking a political risk - there will plenty of people who will cry betrayal. Here's one example. /1
The arguments for no deal are deeply flawed. In this case, the first argument is that EU exporters to the UK would pay more in tariffs than the other way round. This would 'rebalance' our trading relationship & give us £8bn to provide grants to our exporters, it is suggested. /2
This is 'exports good/imports bad' mercantilist nonsense. And who would pay the tariffs? UK consumers. As for providing grants to compensate our exporters, that is contrary to WTO rules.

So much for Brexit being about free trade. /3
The case is then made that free of EU state aid rules, we can follow a buy-British, interventionist economic policy, using 'differentials in tax rates to drive industry towards certain outcomes' - more Tony Benn than Margaret Thatcher. A touching faith in Govt intervention. /4
Except it's combined with a belief in the benefits of deregulation for financial services. We know we're losing passporting rights but what are the EU regulations that we can scrap? In particular, those we can scrap only without a deal? Will this counteract what we've lost? /5
Then there's fish. Ben acknowledges that it's a 'small part' of our GDP but this could 'materially increase'. Perhaps double it to a whopping 0.2% of GDP? Anyway, many of our fishermen rely on export mackerel and herring to... the EU. No deal not so good for them. /6
Finally, a further 'advantage' of no deal is that the Withdrawal Agreement can be repudiated, removing the border in the Irish Sea. This was a key part of the 'oven-ready' deal signed by the PM in October, put to the country in December & legislated for in January. /7
Such a repudiation would be a breach of international law & devastating for the UK's international reputation (we know what Joe Biden thinks). Ben acknowledges that, if we leave the SM & CU there has to be a border but casually says put it between NI & RoI. /8
Unlike the current tax, currency & regulatory border, a customs border between NI & RoI would need a physical infrastructure. The risks of this in terms of the peace process are real & obvious. (In 2016, the Leave campaign promised this wouldn't be necessary.) /9
All these arguments for no deal may be hopeless & reckless but they will be made. Brexit Party types will accuse Boris Johnson of betraying the 'will of the people' (Ben's piece is a pre-emptive strike). The politics of this for the PM are not straightforward. /END
You can follow @DavidGauke.
Tip: mention @twtextapp on a Twitter thread with the keyword “unroll” to get a link to it.

Latest Threads Unrolled: