Theresa May opts for a hard Brexit

HALF a year after choosing Brexit, Britons have learned what they voted for. The single-word result of June’s referendum—“Leave”—followed a campaign boasting copious (incompatible) benefits: taking back control of immigration, ending payments into the European Union budget, rolling back foreign courts’ jurisdiction and trading with the continent as freely as ever. On January 17th Theresa May at last acknowledged that leaving the EU would involve trade-offs, and indicated some of the choices she would make. She will pursue a “hard Brexit” (rebranded “clean” by its advocates), taking Britain out of the EU’s single market in order to reclaim control of immigration and shake off the authority of the EU’s judges.

Mrs May declared that this course represents no retreat, but rather that it will be the making of a “truly global Britain”. Escaping the shackles of the EU will leave the country “more outward-looking than ever before”. Her rhetoric was rousing. But as the negotiations drag on, it will become clear that her vision is riven with tensions and unresolved choices.

Definitely maybe

Mrs May’s speech was substantial and direct—welcome after months in which her statements on Brexit had been Delphic to the point of evasion. Although she plans to leave the single market, Mrs May wants “the freest possible” trade deal with the EU, including privileged access for industries such as cars and finance (see article). In order to be able to strike its own trade deals outside Europe, Britain will also leave the EU’s customs union (freeing itself from the common external tariff), but will aim to keep its benefits in some areas. The government will consider making some payments into the EU budget, but the “vast” contributions of the past will end. Mrs May would like a trade agreement with the EU to be wrapped up within two years, meaning that there is no need for a formal transition arrangement; she suggests a phasing-in period, whose length could vary by sector. Parliament will get a vote on the final deal, though by then it will be too late for it to change much.

The pound rose on the discovery that Mrs Maybe had a plan after all. Sympathetic newspapers compared her steel to that of Margaret Thatcher (perhaps forgetting that the single market was one of the Iron Lady’s proudest achievements). Yet, for her plan to succeed, Mrs May must overcome several obstacles—not least her own contradictory impulses.

The essential task will be to get the EU to agree to the sort of deal she set out this week. When it comes to the single market and customs union, European leaders have made clear their opposition to “cherry-picking”. A tailored transition plan may get the same bleak response. And the EU has never concluded a trade agreement in two years, let alone a deep one.

Mrs May would retort that Britain will get a good deal because its negotiating position is strong. In her speech, after distancing herself from Donald Trump’s Eurobashing, she warned that the EU would be committing “an act of calamitous self-harm” if it tried to punish Britain with a bad deal. Europeans would miss London’s financial markets; they might also lose access to British intelligence, which has “already saved countless lives” across the continent.

Her undiplomatic threats ring hollow. Everyone will lose if there is no agreement, but nobody will lose as much as Britain. The country is in no position to bully its way to a cushy deal and EU leaders in no mood to offer one.

Mrs May’s way for Britain to come out on top, even if it loses access to markets in Europe, is for the country to open itself up to the world. In rediscovering its past as a trading nation, Britain can become a sort of Singapore-on-Thames, free of the dead hand of an over-regulated EU. Long touted by some liberal Brexiteers, the idea has a certain devil-may-care appeal.

Yet if Mrs May is to turn Britain into a freewheeling, laissez-faire economy, she will have to sacrifice some of her own convictions. She has interpreted the Brexit vote as a roar by those left behind by globalisation. On their behalf, she has railed against employers who break the “social contract” by hiring foreigners rather than training locals. Under Mrs May, Britain, a beacon for investment, risks becoming less attractive to foreigners, not more. The minimum wage is rising. She wants to vet foreign takeovers of British firms. Above all, the promise to “control” immigration looks like a euphemism for reducing it (see Bagehot). Forced to choose on a visit to India, Mrs May put continued restrictions on student visas before a trade deal.

The Economist opposed Brexit. If Britain has to leave the single market and the customs union, we would urge the globalising side of Mrs May to prevail over the side that would put up barriers. But for this, Mrs May will have to abandon views to which, as home secretary, she has long held firm. Britain is heading out of the EU, and it will survive. But the chances are that it will be a poorer, more inward-looking place—its drawbridge up, its influence diminished.