Brexit Compromise? Not So Fast! Collapse of UK Governments Just as Likely

Mish Shedlock  |

Word hit this AM of a Brexit compromise between the UK and the EU. I didn't bite. A deal is one thing, approval another.

This morning, the Financial Times reported UK and EU Hammer Out Draft Terms of Brexit Divorce.

The Guardian commented May Tells Her Cabinet, This is the Deal – Now Back Me

This THE Deal?

It could be, but color me skeptical. I did not bite on those headlines.

Opposition Leader Jeremy Corbyn

"Unlikely to be a good deal"

Jo Johnson

Jo Johnson is brother of Boris Johnson. Unlike his brother, Jo is pro-Europe. He resigned May's cabinet because he thinks the deal is a bad one.

Boris Johnson

Boris Johnson resigned as May's Foreign Secretary on July 9.

David Davis

David Davis called this a "moment of truth". He was May's former Brexit Secretary. He resigned on July 8 in disgust of May's handling.

It would seem that May would have been able to appoint a cabinet that would easily back her, but her policies are so bad that did not happen.

Attacks Everywhere

This afternoon the Financial Times reported DUP and Eurosceptics Attack Draft Brexit Treaty Sight Unseen.

Justine Greening, a pro-EU Conservative MP, warned the “entire planet” could see it was a bad deal. “Even if some people in my party can’t see this is a bad deal, everyone else around this entire planet can.”

Sight Unseen Agreement?

Yep. The agreement is provisional. May did not enough integrity to even post it.

We do know one thing: May’s Brexit Compromise Comes with High Price.

Stench to High Heavens

What do we have?

It's hard to say precisely because there is no public record. The FT labeled it as a “backstop to the backstop” .

“Let’s not confuse white smoke with fog over the Thames,” said one official.

I suggest we can expect stench to high heavens when deals are not disclosed.

Will it pass?

It could.

Will it be a good deal? No matter what's in the deal, I am confident of my answer "No."

New Elections

If the deal does not pass, Theresa May is likely to call for new elections.

And that is the key to understanding some of the opposition. Labour wants new elections.

The pro-Europe crowd hopes to hold a new referendum. That's unlikely but every vote counts.

DUP feels dumped. May needs those votes.

Any Miracles?

Are there any miracles in May's hat?

It depends more on compromises the EU is willing to make than anything May can do or say. No matter which way May bends, she upsets somebody.

The EU is likely to postpone compromises until the last moment.

By then, all the hard Brexit groundwork will be in place. No one will fear a hard Brexit anymore. And that's a good thing.

Mike "Mish" Shedlock

This article was originally published on Mish Talk.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


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